quality and hrm lecture 1

7/29/2019 Quality and HRM Lecture 1

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Quality : What is it ?

PP Sengupta

Lecture 1


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Contact me at

Email : [email protected]

Mobile : 9433095778

My profile :

Chief General Manager ( Operations) , Coal India Ltdat Kolkata for 6 years, 36 years in SCM andoperations .

Worked in World Bank projects as procurement lead

Black Belt certification , six sigma Qualified lead assessor , ISO 9000

Certified TPM practitioner , Japanese Institute of PlantEngineers
mailto:[email protected]:[email protected]


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DEFINITIONS OF QUALITY

A degree of excellence [the Concise OxfordDictionary]

The totality of features and characteristics that bearupon the ability of a product or service to satisfy agiven need [British Standard 4778]

The total composite product and service

characteristics of marketing, engineering,manufacture and maintenance through which theproduct and service will meet the expectations ofthe customer [Dr Armand V Feigenbaum]


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PERCEPTIONS OF QUALITY

JAPANSONY, TOYOTA

GERMANYBMW, MERCEDES

SWITZERLANDWATCHES USAMCDONALDS

UKTESCO

TAIWANACER

SINGAPORESIA

INDIABASMATI RICE ,DARJEELING TEA


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Customer's expressed and implied requirementsare met fully

the totality of features and characteristics of aproduct or service that bears on its ability to meeta stated or implied need [ISO, 1994],

fitness for use [Dr. Joseph M Juran, 1988],

conformance to requirement [Philips B Crosby,1979].

DEFINITIONS OF QUALITY


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Definitions of Quality

Fitness for use (Juran)

Conformance to requirements (Crosby)

Degree of excellence Performance exceeding expectations (Q =

P/E)

The totality of features and characteristicsof a product or service that bear on its

ability to satisfy stated or implied needs

ANSI/ASQ


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Defining Quality

ASQ (American Society for Quality):

quality is a subjective term for which each

person has his or her own definition

www.asq.org


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Defining Quality

In technical usage, quality can have two

meanings:

the characteristics of a product or service that

bear on its ability to satisfy stated or implied

needs, and

a product or service free of deficiencies


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Defining Quality - Gurus

Deming - non-faulty systems

Out of the Crisis

Juran - fitness for use

Quality Control Handbook

Crosby - conformance to requirements

Quality is Free


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Garvins Definitions of Quality

Transcendent Definition Quality is something that is intuitively understood but

nearly impossible to communicate such as beauty or

love.

Product-Based Definition Quality is found in the components and attributes of a

product.

User-Based Definition If the customer is satisfied, the product has goodquality.


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Stouts View

Quality = PerformanceExpectation


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Extended definitions

Quality meaning getting everyone to do what

they have agreed to do and to do it right the

first time is the skeletal structure of an

organization, finance is the nourishment, andrelationships are the soul

Crosby

extra-ordinary customer satisfactionor

delighting the customers by extra little things


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Customer-based definitions

Edwards [1968] Quality consists of the capacity to

satisfy wants...

Gilmore [1974] Quality is the degree to which a

specific product satisfies the wants of a specificconsumer.

Kuehn & Day [1962] In the final analysis of the

marketplace, the quality of a product depends on

how well it fits patterns of consumer preferences.

Juran [1988] Quality is fitness for use.

Oakland [1989] The core of a total quality

approach is to identify and meet the requirements

of both internal and external customers.


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Value-based definitions

Broh [1982] Quality is the degree of excellence at an

acceptable price and the control of variability at an

acceptable cost.

Feigenbaum [1983] Quality is the degree to which aspecific product conforms to a design or specification

Newell & Dale [1991] Quality must be achieved in five

basic areas: people, equipment, methods, materials and

the environment to ensure customers need are met.

Kanji [1990] Quality is to satisfy customers requirements

continually; TQM is to achieve quality at low cost by

involving everyones daily commitment.


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Defining Quality- Different Views

Customers view (more subjective) the quality of the design (look, feel, function)

product does whats intended and lasts

Producers view conformance to requirements (Crosby) costs of quality (prevention, scrap, warranty)

increasing conformance raises profits


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Meaning of Quality:

Producers Perspective

Quality of Conformance

Making sure a product or service is produced

according to design if new tires do not conform to specifications, they

wobble

if a hotel room is not clean when a guest checks in,

the hotel is not functioning according tospecifications of its design


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Meaning of Quality:

Consumers Perspective Fitness for use

how well product or

service does what it is

supposed to

Quality of design designing quality

characteristics into a

product or service

A Mercedes and a Ford are

equally fit for use, but withdifferent design dimensions


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Meaning of Quality:

A Final Perspective

Consumers and producers

perspectives depend on each other

Consumers perspective: PRICE

Producers perspective: COST

Consumers view must dominate


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Fitness for

Consumer Use

Producers Perspective Consumers Perspective

Quality of Conformance

Conformance to

specifications Cost

Quality of Design

Quality characteristics

Price

MarketingProduction

Meaning of Quality

Meaning of Quality


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Dimensions of Quality - Product

1. Perfo rmance

Basic operating characteristics

2. Featu res

Extra items added to basic features

3. Reliab il i ty

Probability product will operate over time

4. Con fo rman ce Meeting pre-established standards

5. Du rab il i ty

Life span before replacement


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Dimensions of Quality - Product

6. Serviceab il i t y

Ease of getting repairs, speed & competence of

repairs

7. Aes thetic s

Look, feel, sound, smell or taste

8. Safety

Freedom from injury or harm9. Other per cep tions

Subjective perceptions based on brand name,

advertising, etc


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1. Time & Timeliness Customer waiting time, completed on time

2. Completeness Customer gets all they asked for

3. Courtesy Treatment by employees

4. Consistency

Same level of service for all customers5. Accessibility & Convenience

Ease of obtaining service6. Accuracy

Performed right every time

7. Responsiveness Reactions to unusual situations

Dimensions of Quality Service


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Dimensions of Quality:

Manufactured Products Performance

basic operating characteristics of a product; howwell a car is handled or its gas mileage

Features extra items added to basic features, such as a

stereo CD or a leather interior in a car

Reliability probability that a product will operate properly

within an expected time frame; that is, a TV willwork without repair for about seven years


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Conformance degree to which a product meets preestablished

standards Durability

how long product lasts before replacement

Serviceability

ease of getting repairs, speed of repairs, courtesyand competence of repair person


Manufactured Products (cont.)


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Aesthetics how a product looks, feels, sounds, smells,

or tastes

Safety

assurance that customer will not sufferinjury or harm from a product; an especiallyimportant consideration for automobiles

Perceptions subjective perceptions based on brand

name, advertising, and the like


Manufactured Products (cont.)


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Service

Time and Timeliness

How long must a customer wait for service, and

is it completed on time?

Is an overnight package delivered overnight?

Completeness:

Is everything customer asked for provided?

Is a mail order from a catalogue companycomplete when delivered?


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Service (cont.) Courtesy:

How are customers treated by employees?

Are phone operators nice and are their voicespleasant?

Consistency Is the same level of service provided to each

customer each time?

Is your newspaper delivered on time everymorning?


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Accessibility and convenience How easy is it to obtain service?

Does a service representative answer you calls quickly?

Accuracy

Is the service performed right every time? Is your bank or credit card statement correct every month?

Responsiveness How well does the company react to unusual situations?

How well is a telephone operator able to respond to a customers

questions?


Service (cont.)


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Service Quality Dimensions

Assurance

The knowledge and courtesy of employees and their

ability to inspire trust and confidence.

Empathy Caring, individual attention paid to customers by the

service firm.


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Quality Dimensions (Garvin, 1998)

Quality dimensions are independent

focus on a few dimensions (e.g. Japanese cars reliability,conformance, and aesthetics)

Dimension MeaningPerformance Primary product characteristics

Features Secondary characteristics added features

Conformance Meet specifications or industry standards,

workmanship

Reliability Consistency of performance overtime

Durability Useful life

Service Resolution of problems and complaints, ease of repair

Response Human-to-human interface

Aesthetics Sensory characteristics

Reputation Past performance, ranking first

Recognizing Different


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Perspectives on Quality

Different Perspectives on Quality There are many different definitions and

dimensions of quality.

For the present, you should view quality as a

measure of goodness that is inherent to a productor service.

Employees working for the same firm often viewquality differently as illustrated in the next slide.

Perceptions on Quality Can Vary In order to communicate effectively about quality,

managers need to recognize that differences inperceptions of quality exist.


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Historical Review

Middle age Craft Guilds (training) Industrial Revolution Specialization of labor

Decline in workmanship, product still notcomplicated still 100% inspection

1924 Walter Shewhart developed statisticalchart (Book: Economic Control of Quality ofManufactured Product)

Dodge & Romig developed acceptance

sampling as a substitute for 100% inspection 1942 - US Managers failed to recognize value

of SQC

1946 ASQC (now ASQ) was formed


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Historical Review

1950 William Edwards Deming lectures

CEOs in Japan on SQC

1954 Joseph Juran went to Japan

Managements responsibility for quality

1960 Quality Control Circle (QCC)

formed in Japan quality improvement

1980s US Quality Movement, TQMConcepts published


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Historical Review

Late 1980s automotive industry

emphasize SPC, suppliers required to use

Malcolm Balridge Award established (to

measure TQM implementation) Taguchi

method, Design of Experiments (DOE)

1990s ISO 9000 series became Global

QA std., QS 9000 introduced by automotive

industry customer satisfaction ISO 14000 2000 New ISO 9000:2000 version, Six

Sigma Program introduced information

technology


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Shift to Quality

Pre-World War II 1945 1990s

Isolated

Economies

Focus on

quantity

Period ofchange from

quantity to

quality

Global

Economy

Focus on

quality


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The journey

Inspection

SQC

DOE

Taguchi

Quality

Management

Systems

SixSigma

1930 1950 1970 1980 1990 2000


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SPC

Data

Process

A

B

C

N1

N2

LSL USL

Y


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Quality Gurus

Walter Shewart In 1920s, developed control charts

Introduced the term quality assurance

W. Edwards Deming Developed courses during World War II to teach

statistical quality-control techniques to engineers andexecutives of companies that were military suppliers

After the war, began teaching statistical quality controlto Japanese companies

Joseph M. Juran Followed Deming to Japan in 1954

Focused on strategic quality planning


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Armand V. Feigenbaum In 1951, introduced concepts of total quality control and

continuous quality improvement

Philip Crosby In 1979, emphasized that costs of poor quality far

outweigh the cost of preventing poor quality In 1984, defined absolutes of quality management

conformance to requirements, prevention, and zerodefects

Kaoru Ishikawa Promoted use of quality circles

Developed fishbone diagram

Emphasized importance of internal customer

Quality Gurus (cont.)


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Armand Feigenbaum -

author: Total Quality Control(1961) quality is a customer determination based

on the customers actual experience with the

product or service, measured against his or

her requirements - stated or unstated,conscious or merely sensed, technically

operational or entirely subjective - and

always representing a moving target in a

competitive market.


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W. Edwards Deming

Focus on bringing about improvements in productand service quality by reducing uncertainty andvariability in goods and services design and

associated processes (the beginning of his ideasin 1920s and 1930s).

Higher quality leads to higher productivity andlower costs.

14 Points management philosophy.

Deming Cycle Plan, Do, Study, and Act.

Influential Leaders in Quality Management


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W. Edwards Deming 14 Points

Point 1: Create a Vision and DemonstrateCommitment

Point 2: Learn the Philosophy

Point 3: Understand Inspection

Point 4: Stop Making Decisions Purely onthe Basis of Cost

Point 5: Improve Constantly and Forever

Point 6: Institute Training

Point 7: Institute Leadership




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W. Edwards Deming 14 Points

Point 8: Drive Out Fear

Point 9: Optimize the Efforts of Teams

Point 10: Eliminate Exhortations

Point 11: Eliminate Numerical Quotas

Point 12: Remove Barriers to Pride in Work

Point 13: Encourage Education and Self-Improvement

Point 14: Take Action



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Demings 14 Points

1. Create cons tancy o f pu rpose

2. Adopt ph ilo sophy of p reven tion

3. Cease mass inspec tion

4. Selec t a few supp l iers based on

qual i ty

5. Cons tan tly improve sys tem and

workers


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6. Ins ti tu te worker train ing

7. Ins ti l l leadersh ip amongsuperv isors

8. Elim inate fear among emp loyees

9. Elim inate bar riers betweendepartments

10. Eliminate slogans

Demings 14 Points (cont.)


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11. Remove num er ical quo tas

12. Enhance worker pr ide13. Ins t i tu te vigo rous train ing and

educat ion prog rams

14. Develop a comm itment f rom topmanagement to implement

above 13 poin ts

Demings 14 Points (cont.)


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Deming Wheel: PDCA

Cycle1. PlanIdentify

problem and

develop planfor

improvement.

2. DoImplement

plan on a test

basis.

3. Study/CheckAssess plan; is it

working?

4. ActInstitutionalize

improvement;

continuecycle.

The Deming Cycle


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Plan: study current situation Do: implement plan on trial basis

Study: determine if trial is working correctly

Act: standardize improvements

The Deming Cycle

Why Does It Matter That


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Why Does It Matter That

Difference Definitions of

Quality Exist?

Understanding that definitions and dimensions of

quality exist allows measures to be taken to provide abetter basis for communication and planning in a

firm.



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Perspectives on Quality

Different Perspectives on Quality There are many different definitions and

dimensions of quality.

For the present, you should view quality as a

measure of goodness that is inherent to a productor service.

Employees working for the same firm often viewquality differently as illustrated in the next slide.

Perceptions on Quality Can Vary In order to communicate effectively about quality,

managers need to recognize that differences inperceptions of quality exist.

Diff i F ti l


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Differing Functional

Perspectives on Quality Engineering Perspective

Operations Perspective

Strategic Management Perspective

Marketing Perspective

Financial Perspective

Human Resources Perspective

Engineering Perspective on


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Engineering Perspective onQuality

Nature of Engineering Perspective

Engineers are interested in applying mathematical

problem solving skills and models to the problems of

business and industry.

Two of the major emphases in engineering

Product design

Process design



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Product Design Engineering Involves all of those activities associated with

developing a product from concept development tofinal design and implementation.

Product design life cycle Key to quality as quality is assured at the design

stage.

Concurrent engineering

The simultaneous performance of product andprocess design activities.

Has resulted in improved quality and faster speed tomarket for new products.



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Related Concepts Life Testing

Is a facet of reliability engineering that concerns itself withdetermining whether a product will fail under controlledconditions during a specified life.

Redundancy Is applied so that a back up system can take over for the

failed primary system.

Statistical Process Control

Is concerned with monitoring process capabilityand process stability.

O ti P ti


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Operations Perspective on

Quality Nature of Operations Perspective

The operations management view of quality is rootedin the engineering approach.

Like engineers, operations managers are very

concerned about product and process design. However, rather than focusing on only the technical

aspects of these activities, operations concentrates ofthe management of these activities.

Operations management has developed into anintegrative field, combining concepts fromengineering, operations research, organizationaltheory, organizational behavior, and strategicmanagement.



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Operations Perspective onQuality

Systems View

Operations management utilizes the systems view to

address quality problems that underlies modern

quality management thinking.

The systems view involves the understanding that

product quality is the result of the interactions of

several variables such as machines, labor,

procedures, planning, and management.



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The Systems View of Operation Management

Planning Organizing

Controlling

Inputs ConversionProcess

Outputs Customers

Feedback

Figure 1.3

O ti P ti


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Quality Operations/Marketing Interface

In recent years, a major advance in operationsmanagement has been the improved understandingof the operations/marketing interface.

The interface has resulted in an increased focus onthe customer.

This externalized view is important as operationsmanagers in firms still tend to be focused heavily onmeeting production schedules, sometimes

at the expense of good quality.



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Strategic View of Operations Management

Among the recent advances in operations

management has been a migration towards a more

strategic view.

Ferdows and Demeyer linked this strategic view of

operations management to quality management by

proposing the Sand Cone Model in which quality was

identified as the base on which lasting improvement

in other competitive dimensions were established.



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An Operations Management Competence ModelThe Sand Cone Model

Quality

Dependability

Cost Efficiency

Speed

Figure 1.4

Strategic Management


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Perspective on Quality Nature of the Strategic Management Perspective

Strategy refers to the planning processes used by anorganization to achieve a set of long term goals.

The planned course of action must be cohesive and

coherent in terms of goals, policies, plans, andsequencing to achieve quality improvement.

Initially, quality-related strategic planning was treatedas if it were a separate exercise from firm-levelstrategic planning.

However, quality management, to become pervasive ina firm, needed to be included in all of the firmsbusiness practices, including strategic planning.



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Perspective on QualityA Generic Strategic Planning Process

Firm Mission

and Goals

Strategic

Options

Conflict Politics

and Change

Strategic Alignment

Between

Structure and Goals

Org. Reward

Systems

Organizational

Design

Internal

Analysis

External

Analysis

Business Level

Strategy

Corporate Level

Strategy

Operational

Subplans

Figure 1.5



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Perspective on Quality

Goal of Strategic Quality Planning

The ultimate goal of strategic quality planning is to

aid an organization to achieve sustainable

competitive advantage.

Research shows that quality is still the major

concern of CEOs.

Marketing Perspective on


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Quality

Nature of Marketing Perspective

Marketing efforts are often focused on managing

perceptions of quality.

Relationship Management Directing attention toward satisfying and delivering

value to the customer.

Tools for Influencing Customer Perceptions of

Quality Price and advertising are the primary tools for

influencing customer perceptions of quality, but

are imperfect mechanisms.



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Organization


Quality

A Marketing System

Intermediary

Customer

PaymentOffering

Offering

Offering

Payment

Payment



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g pQuality

Focus on Service

Another important contribution of the marketing

perspective has been the focus on service.

Customer service surveys are important tools forassessing the multiple dimensions of quality.

Financial Perspective on


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Quality

Nature of the Financial Perspective

One of the most commonly asked questions about

quality management is will it pay us financial

benefits?

The financial perspective relies more on

quantified, measurable, results-oriented thinking.

W. Edwards Deming made the first theoretical

attempt to link quality improvements to financial

results through the Deming Value Chain.



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Quality

The Deming Value Chain

Improve

Quality

Productivity

Improves

Capturethe

Market

Provide Jobs

and More JobsStay in

Business

Cost decrease because of less

rework, fewer mistakes, fewer

delays, snags; better use ofmachine-time and materials

Figure 1.8



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Quality Law of Diminishing Marginal Returns

According to this law, there is a point at which

investments in quality improvement will become

uneconomical.

According to the quadratic economic quality level

model, higher levels of quality will result in higher

expenditures.

This view is at odds with the ethic of continual

improvement.

Cost of Quality


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Cost of Quality

Basic Economic Quality Level Model

Quality

Cost

Costs of Improving

Quality

Losses due to poor

quality

Total Quality Costs = Sum of Losses and Gains

Minimum

Cost

Optimum Quality Level

Figure 1.9

Human Resources Perspective


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pon Quality

Nature of Human Resources Perspective Understanding the human resources perspective

on quality is essential as it is impossible to

implement quality without the commitment and

action of employees.

Related Concepts

Employee Empowerment

Organizational Design

Job Analysis

360-degree evaluation

Total Quality Human Resources Management

Human Resource Perspective


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on Quality

Employee Empowerment Empowering employees involves moving decision

making to the lowest level in the organization.

Organizational Design

Human resources managers are involved in manyaspects of organizational design, such as the designof reward systems, pay systems, organizationalstructure, compensation, training mechanisms, andemployee grievance arbitration.

Job Analysis Involves collecting detailed information about a

particular job.



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on Quality 360-Degree Evaluation

A performance measurement system in which an

employees peers, supervisors, and subordinates

are involved in evaluating the workers

performance.

Total Quality Human Resources Management

(TQHRM)

TQHRM involves many of the concepts of quality

management to provide a more supportive and

empowered environment.

The Three Spheres of Quality


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e ee Sp e es o Qua ty

Quality Control Includes phases of analysis, relation, and

generalization.

Activities relating to quality control include:

Monitoring process capability and stability

Measuring process performance

Reducing process variability

Optimizing processes to nominal measures Performing acceptance sampling

Developing and maintaining control charts



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p Q y

Quality Assurance Refers to activities associated with guaranteeing

the quality of a product or service.

Quality assurance activities include tasks

such as: Failure mode and effects analysis

Concurrent engineering

Experimental design

Process improvements Design team formation and management Off-line experimentation

Reliability/durability product testing



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p Q y

Quality Management The management processes that overarch and tie

together the control and assurance activities.

Quality management activities:

Planning for quality improvement.

Creating a quality organizational culture.

Providing leadership and support.

Providing training and retraining.

Designing an organizational system that reinforces

quality ideals.

Providing employee recognition.

Facilitating organizational communication.

Other Perspectives on Quality


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p Q y

The Value-Added Perspective on Quality A customer-based perspective on quality that is

utilized by services, manufacturing, and public

sector organizations.

Involves a subjective assessment of the efficacy ofevery step of the process for the customer.

Other Perspectives on Quality


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p y

Cultural Perspectives on Quality International marketers have long noted that there

are differences in tastes and preferences between

cultures and nations.

It is not so obvious that approaches to qualityimprovement may differ according to culture.

Contingency Approach to


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g y ppQuality

Contingency Theory Contingency theory presupposes that there is no

theory or method for operating a business that canbe applied in all situations.

As a result, a coherent quality strategy will need toaddress key environmental variables.

Contingency Approach Definitions and dimensions of quality applied

within an organization will, and should vary.

Dimensions of quality will depend on theenvironment in which a company operates.

Provides flexibility to managers in pursuing quality.


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Understanding Quality

Principles of Total Quality

1. A focus on customers and stakeholders,

2. A process focus supported by continuousimprovement and learning, and

3. Participation and teamwork by everyonein the organization.

Th Q lit Hi h


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The Quality Hierarchy

Inspection

Quality Control

Quality Assurance

Total QualityManagement

Incorporates QA/QC activities

into company-wide systemaimed

at satisfying the customer

Actions to insure products or

services conform to companyrequirements

Operational techniques to make

inspection more efficient and to

reduce the costs of quality.

Inspect products

Prevention

Detection

SPC

SQC

Q lit C t l


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Quality ControlQC the use techniques and activities toachieve, sustain and improve quality ofproducts or service. It integrates these relatedtechniques and activities:

1. Specifications of what is needed

2. Design of the products/service to meet specs.3. Production or installation to meet full intent of

specs.

4. Inspection to determine conformance to

specifications5. Review usage to provide information for

revision of specs. if needed

The aim should be towards quality

improvement

Q lit A


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Quality Assurance

All those planned or systematic actionsnecessary to provide adequate

confidence that a product or service will

satisfy given requirements for quality Need systems and procedures to ensure

consistency in methods for producing

products

Total Quality Management


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(TQM) philosophy and a set of guiding principles

foundation of continuously improving

organization

philosophy to achieve excellence process in set of interrelated activities using

specific inputs to produce/deliver specific

outputs

process = business and production

customers refers to external and internal

suppliers also both external and internal

customer-su lier chains

R ibilit f Q lit


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Responsibility for Quality

Marketing

Design

Engineering

Procurement

(Purchasing)

Product Service

Packing &

Storage

Inspection

& Test

Production Process

Design

Customer

Quality

Product /

Service

R ibilit f Q lit


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Responsibility for Quality

Quality not responsibility of any one personor departmenteveryones job (operatorto CEO)

Start from marketing determine customer

requirements until product received bysatisfied customer

Delegated to areas with authority to makequality decisions

Areas responsible (figure next slide)

T t l Q lit M t


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Commitment to quality throughout organization

Principles of TQM

Customer-oriented Leadership

Strategic planning

Employee responsibility

Continuous improvement

Cooperation

Statistical methods

Training and education

TQM d


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TQM and

Partnering a relationship between a company and its

supplier based on mutual qualitystandards

Customers system must measure customer

satisfaction

Information Technology infrastructure of hardware, networks, and

software necessary to support a qualityprogram

Quality Improvement


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Q y p

and Role of Employees

Participative

problem solving employees involved in

quality management

every employee has

undergone extensive

training to provide quality

service to Disneys guests

Quality Circle


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PresentationImplementation

Monitoring

SolutionProblem results

Problem

AnalysisCause and effect

Data collection

and analysis

Problem

IdentificationList alternatives

ConsensusBrainstorming

TrainingGroup processes

Data collection

Problem analysis

Organization8-10 membersSame area

Supervisor/moderator

Quality Circle

Quality Management


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Six Sigma

Defectsare any mistakes or errors that arepassed on to the customer(many people also usethe term nonconformance).

Defects per unit (DPU)=Number of defects discovered

Number of units processed

Quality Management


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Six Sigma

The Six Sigma concept characterizesquality performance by defects permillion opportunities (dpmo),

computed as DPU 1,000,000opportunities for error (or, as is oftenused in services, errors per million

opportunitiesepmo).

Quality Management


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Six Sigma

A DPU measure might be lost bags per customer.However, customers may have different numbers ofbags; thus the number of opportunities for error isthe average number of bags per customer.

If the average number of bags per customer is 1.6,and the airline recorded 3 lost bags for 8,000passengers in one month (note: 12,800 opportunities

for error in one month), then

epmo = (3/8,000 DPU) 1,000,000/1.6 = 234.375

Quality Management


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Six Sigmas DMAIC Process

1. Define: identify customers and their priorities;identify and define a suitable project; identify CTQs(critical to quality characteristics).

2. Measure: determine how to measure the processand how it is performing; identify key internalprocesses that influence CTQs and measurecurrent defects.

3. Analyze: determine likely causes of defects andunderstand why defects are generated byidentifying key variables that cause processvariation.


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Six Sigmas DMAIC Process

4. Improve: identify means to remove causesof defects; confirm key variables; modify theprocess to stay within acceptable range.

5. Control: determine how to maintainimprovements; put tools in place to ensurethat key variables remain within acceptableranges under the modified process.


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Cost of Quality Measurements

Thecost of qualityrefers to the costs associatedwith avoiding poor quality or those incurred as aresult of poor quality. Four major categories are:

Prevention costsare those expended to keepnonconforming goods and services from beingmade and reaching the customer.

Appraisal costsare those expended onascertaining quality levels through measurementand analysis of data to detect and correctproblems.


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Cost of Quality Measurements

Internal-failure costsarecosts incurred asa result of unsatisfactory quality that is foundbefore delivery of good or service to the

customer. External-failure costsare incurred after

poor-quality goods or services reach thecustomer.

Seven Tools of Quality Management


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The Seven QC Tools

1. Flowcharts: process mapping to identify thesequence of activities or flow of materials/information in a process.

2. Run Charts and Control Charts: a run chartis a line graph with data plotted over time;control charts include control limits.

3. Checksheets: simple tools for data collection,

ensure completeness.

4. Histograms: graphically represent frequency ofvalues within a specified group.

Seven Tools of Quality Management


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The Seven QC Tools5. Pareto Diagrams: separate the vital few

from the trivial many causes; providedirection for selecting projects for

improvement.6. Cause-and-Effect Diagrams: represent

chain of relationships; often called a fishbonediagram.

7. Scatter Diagrams: graphical component ofregression analysis.

quality and hrm lecture 1

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