© Wiley 20071 Chapter 5 Total Quality Management.

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Wiley 2007*Chapter 5 Total Quality Management Wiley 2007 Wiley 2007*OUTLINEDefining QualityCost of QualityThe evolution of TQM Quality and StandardsWhy TQM Efforts Fail Wiley 2007Defining Quality Wiley 2007* Wiley 2007 Wiley 2007*Defining QualityDefinition of quality is dependent on the people defining itThere is a lack of a single, universal definition of quality5 common definitions includeConformance to specificationsFitness for useValue for price paidSupport servicesPsychological criteria Wiley 2007 Wiley 2007*Defining Quality 5 WaysConformance to specificationsDoes product/service meet targets and tolerances defined by designers?Fitness for use Evaluates performance for intended useValue for price paidEvaluation of usefulness vs. price paidSupport servicesQuality of support after salePsychologicale.g. Ambiance(), prestige(), friendly staff Wiley 2007 Wiley 2007*Manufacturing Quality vs. Service QualityManufacturing quality focuses on tangible product featuresConformance, performance, reliability, featuresService organizations produce intangible products that must be experiencedQuality often defined by perceptional factors like courtesy, friendliness, promptness, waiting time, consistency Wiley 2007Cost of Quality Wiley 2007* Wiley 2007 Wiley 2007*Cost of QualityQuality affects all aspects of the organizationQuality has dramatic cost implications of;Quality control costsPrevention costsAppraisal costsQuality failure costsInternal failure costsExternal failure costs Wiley 2007 Wiley 2007*Cost of Quality 4 CategoriesEarly detection/prevention is less costly May be less by a factor of 10 Wiley 2007The evolution of TQM Wiley 2007* Wiley 2007 Wiley 2007*Evolution of TQM New Focus Wiley 2007 Wiley 2007*Quality Gurus Wiley 2007 Wiley 2007*TQM PhilosophyTQM Focuses on identifying quality problem root causes Encompasses the entire organizationInvolves the technical as well as peopleRelies on seven basic concepts ofCustomer focusContinuous improvementEmployee empowermentUse of quality toolsProduct designProcess managementManaging supplier quality Wiley 2007 Wiley 2007*TQM Philosophy - conceptsFocus on CustomerIdentify and meet customer needsStay tuned to changing needs, e.g. fashion stylesContinuous ImprovementContinuous learning and problem solving, e.g. Kaizen, 6 sigmaBenchmarkingEmployee EmpowermentEmpower all employees; external and internal customers Wiley 2007 Wiley 2007*TQM Philosophy Concepts (continued)Team ApproachTeams formed around processes 8 to 10 peopleMeet weekly to analyze and solve problemsUnderstanding Quality ToolsOngoing training on analysis, assessment, and correction, & implementation toolsStudying practices at best in class companies Plan-Do-Study-Act Wiley 2007 Wiley 2007*Ways of Improving QualityPlan-Do-Study-Act Cycle (PDSA)Also called the Deming Wheel after originatorCircular, never ending problem solving processSeven Tools of Quality ControlTools typically taught to problem solving teamsQuality Function DeploymentUsed to translate customer preferences to design Wiley 2007 Wiley 2007*PDSA DetailsPlanEvaluate current processCollect procedures, data, identify problemsDevelop an improvement plan, performance objectivesDoImplement the plan trial basisStudyCollect data and evaluate against objectivesActCommunicate the results from trialIf successful, implement new process Wiley 2007 Wiley 2007*PDSA (continued)Cycle is repeated After act phase, start planning and repeat process Wiley 2007 Wiley 2007*Seven Tools of Quality ControlCause-and-Effect DiagramsFlowchartsChecklistsControl ChartsScatter DiagramsPareto AnalysisHistograms Wiley 2007 Wiley 2007*Cause-and-Effect DiagramsCalled Fishbone DiagramFocused on solving identified quality problem Wiley 2007 Wiley 2007*FlowchartsUsed to document the detailed steps in a processOften the first step in Process Re-Engineering Wiley 2007 Wiley 2007*ChecklistSimple data check-off sheet designed to identify type of quality problems at each work station; per shift, per machine, per operator Wiley 2007 Wiley 2007*Control ChartsImportant tool used in Statistical Process Control Chapter 6The UCL and LCL are calculated limits used to show when process is in or out of control Wiley 2007 Wiley 2007*Scatter DiagramsA graph that shows how two variables are related to one anotherData can be used in a regression analysis to establish equation for the relationship Wiley 2007 Wiley 2007*Pareto AnalysisTechnique that displays the degree of importance for each elementNamed after the 19th century Italian economistOften called the 80-20 RulePrinciple is that quality problems are the result of only a few problems e.g. 80% of the problems caused by 20% of causes Wiley 2007 Wiley 2007*HistogramsA chart that shows the frequency distribution of observed values of a variable like service time at a bank drive-up windowDisplays whether the distribution is symmetrical (normal) or skewed Wiley 2007 Wiley 2007*Product Design - Quality Function Deployment Critical to ensure product design meets customer expectationsUseful tool for translating customer specifications into technical requirements is Quality Function Deployment (QFD)QFD encompassesCustomer requirementsCompetitive evaluationProduct characteristicsRelationship matrixTrade-off matrixSetting Targets Wiley 2007 Wiley 2007*Quality Function Deployment(QFD) DetailsProcess used to ensure that the product meets customer specificationsVoice of theengineerVoice of the customerCustomer-basedbenchmarks Wiley 2007 Wiley 2007*QFD - House of QualityAdding trade-offs, targets & developing product specificationsTrade-offsTargetsTechnicalBenchmarks Wiley 2007 Wiley 2007*Reliability critical to qualityReliability is the probability that the product, service or part will function as expectedNo product is 100% certain to function properlyReliability is a probability function dependent on sub-parts or components Wiley 2007 Wiley 2007*Reliability critical to qualityReliability of a system is the product of component reliabilitiesRS = (R1) (R2) (R3) . . . (Rn)RS = reliability of the product or systemR1 = reliability of the componentsIncrease reliability by placing components in parallel Wiley 2007 Wiley 2007*Reliability critical to qualityIncrease reliability by placing components in parallel Parallel components allow system to operate if one or the other failsRS = R1 + (R2* Probability of needing 2nd component) Wiley 2007 Wiley 2007*Process ManagementQuality products come from quality sourcesQuality must be built into the processQuality at the source is belief that it is better to uncover source of quality problems and correct itTQM extends to quality of product from companys suppliers Wiley 2007Quality and Standards Wiley 2007* Wiley 2007 Wiley 2007* Quality Awards and StandardsMalcolm Baldrige National Quality Award (MBNQA)The Deming Prize ISO 9000 CertificationISO 14000 Standards Wiley 2007 Wiley 2007*MBNQA- What Is It?Award named after the former Secretary of Commerce Regan AdministrationIntended to reward and stimulate quality initiativesGiven to no more that two companies in each of three categories; manufacturing, service, and small businessPast winners; Motorola Corp., Xerox, FedEx, 3M, IBM, Ritz-Carlton Wiley 2007 Wiley 2007*The Deming PrizeGiven by the Union of Japanese Scientists and Engineers since 1951Named after W. Edwards Deming who worked to improve Japanese quality after WWIINot open to foreign companies until 1984Florida P & L was first US company winner Wiley 2007 Wiley 2007*ISO StandardsISO 9000 Standards: Certification developed by International Organization for StandardizationSet of internationally recognized quality standards Companies are periodically audited & certifiedISO 9000:2000 QMS Fundamentals and StandardsISO 9001:2000 QMS RequirementsISO 9004:2000 QMS - Guidelines for PerformanceMore than 40,000 companies have been certified ISO 14000: Focuses on a companys environmental responsibility Wiley 2007Why TQM Efforts Fail Wiley 2007* Wiley 2007 Wiley 2007*Why TQM Efforts FailLack of a genuine quality cultureLack of top management support and commitmentOver- and under-reliance on SPC methods Wiley 2007 Wiley 2007*TQM Within OMTQM is broad sweeping organizational changeTQM impactsMarketing providing key inputs of customer informationFinance evaluating and monitoring financial impactAccounting provides exact costingEngineering translate customer requirements into specific engineering termsPurchasing acquiring materials to support product developmentHuman Resources hire employees with skills necessaryInformation systems increased need for accessible information Wiley 2007END OF LECTURE Wiley 2007* Wiley 2007

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