Management 4110 Midterm
PZ&B service quality dimensions
Tangibles, service reliability, responsiveness, assurance, empathy
Guarantees should be
Unconditional Meaningful Understandable Communicable Painless to Invoke
Customer relationship management systems
Use data to manage the three phases of customer relationship management Acquisition, Retention, enhancement. costs 6x more to acquire customers than to retain
Product based
Quality is found in the components and attributes of a product
Benchmarking steps at xerox
1. Decide what to benchmark 2.Identify whom to benchmark 3. Plan and conduct the investigation 4. Determine the current performance gap 5. Project future performance levels 6. Communicate benchmarking findings and gain acceptance 7. Revise performance goals. 8. Develop action plans 9. Implement specific actions and monitor progress 10. Recalibrate the benchmarks.
Two keys to openeness
1. It makes for a better competitor and mutually striving competition. 2. Can be a phycological barrier to entry if you're super confident in your work.
Four steps in developing a useful survey
1. identifying customer requirements 2. Developing and validating the instrument 3. Implementing the survey 4. Analyzing the results
Stephen Covey's 8 habits
7 habits of effective people 1. Be proactive 2. Begin with the end in mind. be able to see desired outcome 3. Put first things first 4. Think win/win 5. Seek first to understand and then to be understood. 6. Synergize-creative cooperation 7. Sharpen the saw- This involves learning from previous experience and encouraging others to do the same. 8. Find your voice and inspire others to do the same
Single Sourcing
A way to reduce the number of suppliers by developing relationships with a few suppliers for long contract terms.
Customer rationalization
Agreement between marketing and operations as to which customers add the greatest advantage and profits over time.
Actively solicited customer feedback approaches
All supplier initiated contact with customers. Telephoning, focus groups and surveys Soft data is phone contact, focus groups and survey results. Hard data measurements data such as height weight volume or speed that can be measured on a continuous scale Soft data is at best ordinal data which is ranked so one measure is higher than the next.
Benchmark
An organization recognized for its exemplary operational performance.
Engineering perspective
Applied science. Product design engineering involves all those activities associated with developing a product from concept development to final design and implementation. Product design is key because quality is assured at the design state. Concurrent engineering has resulted with the simultaneous performance of these activities with cross functional teams doing product and process design. Life testing is a facet of reliability engineering that determines whether a product will fail under controlled conditions during a specified life. Helps to see if a redundant system can take over the primary system such as NASA space shuttles. Statistical process control which is concerned with monitoring process capability and process stability. If a process is capable, it will consistently produce products that meet specification. If a process is stable it will only exhibit random or common cause variation rather than nonrandom special cause variation.
Tom Peters
Approached quality from an empirically based perspective.
Features
Attributes of a product that supplement the product's basic performance. Bells and whistles
Key business factors
Attributes that influence operations of a business such as mission, vision, values, Not key measures (metrics that need to be found to gauge health of business) or critical success factors (factors that help to determine the success of the firm)
Other service quality dimensions
Availability, professionalism, timeliness, completeness, and pleasantness
External customers
Bill-paying receivers of our work. Ultimate people you are trying to satisfy.
5w2h
Business process benchmarking that results in answers to seven questions who what where when why how and how much
scrap effciency
COGS/scrap
Theory
Coherent group of general propositions used as principals of explanation for a class of phenomena. Theory must have four elements, what, how, why, and who-where-when A theory generated by observation and description is said to have been developed by the process of induction Using deduction, researchers propose a model based on prior research and design an experiment to test the theoretical model
Performance Benchmarking
Comparing cost structures, speed, quality levels,etc
Strategic benchmarking
Comparing firm competitiveness along several dimensions
Functional benchmarking
Comparing or learning how another firm performs a particular function
Product benchmarking
Comparing product attributes and functionality often includes reverse engineering, or dismantling competitors products to understand strengths and weaknesses of their design
Passively solicited customer feedback approaches
Customer initiated contact such as filling out restaurant complaint card, calling toll free or submitting an inquiry. Usually deals with more complaints
Perceived quality
Customer opinion.
Marketing perspective
Customer relationship management, marketing has directed its attention toward satisfying the customer and delivering value to the customer. Marketer focuses on perceived quality and managing quality perceptions. Brings voice of customer to design process. Customer service surveys are important tools for assessing the multiple dimensions of quality. Can cause conflict because marketers want to individualize products whereas producers want to standardize products.
Customer defections
Customers who do not repeat business in some fixed period of time.
Upstream processing
Dealing with suppliers, negotiating, selecting and improving supplier performance.
Downstream processes
Delivering products, and services and serving customers
Correcive action
Document failure and address to make sure it never happens again.
Reactive customer driven quality
Don't do it.
Serviceability
Ease of repair for a product, if it can be easy and cheaply repaired its serviceable.
Human Resources Perspective
Employee empowerment. Empowering employees involves moving decision making to the lowest level possible in the organization. Closely related to organizational design. HR helps in the aspects of organizational design such as the design of reward systems, pay systems, organizational structure, compensation, training mechanisms, and employee grievance arbitration. Quality management flourishes where the workers and the company needs are closely aligned. Job analysis is a major function of HR. Involves collection of detailed info about a particular job. 360 degree evaluation in which an employee's peers, supervisors, and subordinates in evaluating the worker's performance.
Internal customers
Employees receiving goods or services from within the same firm. Second part of the production process is a customer of the first blah blah.
Commonly benchmarked performance measures
Financial ratios, such as ROA or ROI Productivity ratios are useful in measuring the extent to which a firm effectively uses the scarce resources available to them Customer related results- include customer satisfaction, customer dissatisfaction yadi yadi yadi. Operating results-tracking the effectiveness. Sycle times, value added, waste lessening Human resource measures-how effective business is being run Quality measures- such as reject rates, percent defectiveness blah blah market share data- basically how successful a business is Structural measures- objectives, policies, and procedures followed by a firm.
Successful firms do what
Focus on a contingency perspective.
Kaoru Ishikawa
Founder of Japanese Union of Scientists- Came up with company wide quality control. Had a quality philosophy with 11 points 1. Quality begins with education and ends with education 2. The first step in quality is to know the requirements of the customer 3. The ideal state of quality control when inspection is no longer necessary 4. remove the root causes not the symptoms 5. quality control is the responsibility of all workers and all divisions 6. Do not confuse the means with the objectives 7. Put quality first and set your sights on long term objectives 8. Marketing is the entrance and exit of quality 9. Top management must not show anger when facts are presented to subordinates 10. Ninety five percent of the problems in a compnay can be solves by the seven tools of quality control 11. data without dispersion info are false data
Supply chain perspective
Grew out of the concept of the value chain, which includes inbound logistics, core processes, and outbound logistics. Operations, logistics, and marketing are the primary participants in the supply chain. Upstream activities include all of those activities involving interaction with suppliers. Supplier qualification involves evaluating supplier performance to determine whether or not they are worthy providers. Many times you can filter suppliers if they follow their international standard of ISO 9000:2008 Supplier development activities include evaluating, training, and implementing systems with suppliers. Includes the use of electronic data interchange to link customer purchasing systems to supplier enterprise resource systems Acceptance sampling may be needed to determine whether supplier products meet requirements Core processes activities include traditional process improvement as well as value stream mapping. Includes flowcharting processes to see where customer value can be added. Six sigma is a procedure for implementing quality improvement analysis to reduce costs and improve product, service, and process design. Steps include, define, measure, analyze, improve, and control related activities. Major tool of six sigma is the design of experiments Downstream activities include shipping an logistics, customer support, and focusing on delivery reliability. Supply chain management has also focused on after sale service.
Genichi Taguchi
Ideal quality refers to a reference point for determining the quality level of a product or service. Ideal quality is delivered if a product performs its intended function throughout its projected life under reasonable operating conditions. He also didn't agree with variation of specs. Any deviation of specs results in a loss for society. The taguchi method 1. A basis for determining the functional relationship between controllable product or service design factors and the outcomes of a process 2. A method for adjusting the mean of a process by optimizing controllable variables 3. A procedure for examining the relationship between random noise in the process and product or service varability Robust design- products and services should be designed so they are inherently defect free. Concept design, parameter design and tolerance design.
User-based
If the customer is satisfied, the product has good quality
Manufacturing based
If the product conforms to design specifications, it has good quality
Value based
If the product is perceived as providing good value for the price, it has good quality
Process benchmarking
Initiator firm focuses its observation and investigation on business processes.
Cultural perspectives on quality
International marketers have long noted differences in tastes and preferences.
Complaint resolution
Involves the transformation of a negative situation into one in which the complainant is restored to the state existing prior to the occurrence of a problem First thing to do is compensate people for losses. Second component is contrition, which is apologize. Must be designed so those who complain reach resolutions quickly. Complaint-recovery process must be documented for documenting complaints and solving them
Assurance
Knowledge and courtesy of employees and their ability to inspire trust and confidence
Financial perspective
Mainly focused on the risks of investments and the potential rewards resulting from those investments. The goal of finance is to maximize return for a given level of risk. Language of management is money. Pursuit of quality does not safeguard a company against bad mangement. Law of diminishing returns-- point at which investment in quality improvement will become uneconomical
Conformance
Most traditional definition of quality. Quantifiable specifications for a product such as capacity, speed, size. Great for product quality but hard to establish for service quality
Financial benchmarking
Perform financial analysis and compare the results in an effort to assess your overall competitiveness.
Garvin eight quality dimensions based off the definitions
Performance, features, reliability, conformance, durability, serviceability, aesthetics, perceived quality
Tangibles
Physical appearance of a service facility.
Strategic management perspective
Planning process used by an organization to achieve a set of long term goals. Company strategies are rooted in its mission and core values. Strategy process refers to the steps an organization uses in the development of its strategic plans. Often involves a comprehensive environmental analysis that includes the remote, operating, and external environments that influence quality performance. Alignment refers to consistency between different operational subplans and the overall strategic plan. Ultimate goal is to sustain a competitive advantage.
W. Edwards Deming
Preeminent authority on quality management. Found Japan to have best commitment to quality. Stressed that consumers are well served by insisting that service and product providers deliver high quality. 14 points for management 1. Create constancy of purpose toward improvement of product and service with the aim to become competitive, stay in business and provide jobs. Long term. 2. Adopt a new philosophy, we are in a new economic age 3. Cease dependence on mass inspection to improve quality--build quality in the first place, proactive vs reactive. Quality at the source is all workers are responsible for their own work and perform needed inspections at each stage of the process. 4. End the practice of awarding business on the basis of price tag alone. Just in time purchasing minimizes suppliers. 5. Improve constantly and forever the system of production and service, to improve quality and productivity and thus constantly decrease cost. 6. Institute training on the job- 7. Improve leadership- 8. Drive out fear so that everyone may work effectively for the company- Don't let employees be fearful to change or even admit problems existed. 9. Break down barriers between departments don't have a sequential or departmental approach to design rather have a parallel processing in focused teams. 10. Eliminate slogans, exhortations and targets for the workforce that ask for zero defects and new levels of productivity-- These programs have opposite intended effect. Can make employees jaded. 11. Eliminate work standards on the factory floor- Eliminate management by numbers and substitute leadership. If quantity becomes the overriding concern, quality suffers. Management by objective refers to a process of setting annual goals, typically during performance 12. Remove barriers that rob workers of their right to pride in the quality of their work--- don't let unskilled workers not have any pride in the organization 13. Institute a vigorous program of education and self improvement-- Generalized education, reward learning 14. Put everybody in the company to work to accomplish the transformation-- Everyone is responsible for improving quality. Demling deadly diseases 1. lack on constancy of purpose 2. emphasis on short term profits 3. Evaluation of performance, merit rating, or annual review 4. Mobility of management 5. Running a company on visible figures alone 6. excessive medical costs for employee health care 7. excessive costs of warrantees
Robert Camp
Principal pioneer of benchmarking, sharing of information so both companies can improve.
Realiability
Propensity for a product to perform consistently over its useful design life, Product is considered reliable if chance of failing is low during its designed life
Total Quality Control by Armand Feigenbaum.
Quality Leadership, quality technology, and organizational commitment Four deadly sins, Hothouse quality- programs that get a lot of hoopla with little follow through Wishful thinking- occurs with those who would pursue protectionism to keep american firms from having to compete Producing oversees- is a panacea that managers sometimes overtake to solve quality problems. Confining quality means that quality historically has been viewed as simply a shop floor concern. But it's everyone's concern. Had a 19 step process for improving.
Philip Crosby
Quality as a management process can be a source of profit for an organization. 14 steps 1. make it clear that management is committed to quality 2. form quality improvement teams with representatives from each department 3. Determine how to measure where current and potential quality problems lie. 4. Evaluate the cost of quality and explain its use as a management tool. 5. Raise the quality awareness and personal concern of all employees 6. Take formal actions to correct problems identified through previous steps 7. Establish a committee for the zero defects programs 8. Train all employees to actively carry out their part of the quality improvement program 9. Hold a zero defects day to let all employees realize that there has been a change 10. Encourage individuals to establish improvement goals for themselves and their groups 11. encourage employees to communicate to management the obstacles they face in attaining and improving their goals. 12. Recognize and appreciate those who pariticpate 13. Establish quality councils to communicate on a regular basis. 14. Do it all over again.
Quality management
Quality is responsibility of all management, not just quality managers. Planning for quality improvement Creating a quality organizational culture Providing leadership and support Providing training and retraining Designing an organizational system Providing employee recognition Facilitating organizational communication.
Transcendent
Quality is something that is intuitively understood but nearly impossible to communicate. like love hahaha NF
Customer
Receiver of goods or services
10 determinants of service quality PZB
Reliability involves consistency of performance and dependability. It means that the firm performs the service right the first time. It also means the firm honors irs promises Responsiveness concerns with the willingness or readiness of employees to provide service Competence means possession of the required skills and knowledge to perform the service. Access involves approach-ability and ease of contract Courtesy involves politeness, respect, consideration, and friendliness of contact personnel Communication means keeping customers informed in language they can understanding listening to them Credibility involves trustworthiness, believably, honesty. it involves having the customer's best interests at heart. Security is the freedom from danger, risk, or doubt Understanding/knowing the customer involves making the effort to understand the customers needs. Tangibles includes the physical evidence of the service.
Customer driven quality
Represents a proactive approach to satisfying customer needs that is based on gathering data about our customers to learn their needs and preferences.
Carol King identified service quality as
Responsiveness, competence, access, courtesy, communication, credibility, security, and understanding
Operations perspective
Rooted in engineering approach. Focuses on the management of product and process design. Uses the systems view 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. Has migrated toward a strategic view. Quality as base, then dependability, speed, cost effciency
Driving force of century of productivity
Scientific management- Fredrick Taylor separated planning and execution.
Michael Hammer and James Champy
Screwed up saying re-engineering would help but failed a lot.
Aesthetics
Subjective sensory characteristics such as taste, feel, sound, look, and smell.
Strategic partnerships
Suppliers become de facto subsidiaries to their major customers.
The sum of upstream flows and downstream flows is called
Supply chain
Service reliability
The ability of the service provider to perform the promised service dependably and accurately
Durability
The degree to which a product tolerates stress or trauma without failing.
Empathy
The desire for customers to have caring, individualized attention from a service firm.
Performance
The effciency with which a product achieves its intended purpose. Generally, better performance=better quality
Customer relationship management.
The view of the customer asserts that he or she is a valued asset to be managed. Tangibles such as facilities and machinery meet the intangibles such as professionalism and empathy to provide a satisfying experience. Four important design aspects to this management 1)complaint resolution 2) feedback 3) guarantees 4) corrective action
Problems with benchmarking
There may be substantial difficulty obtaining cooperation from firms in own industry. Must have something to offer in reciprocal. The predominance of functional benchmarking with firms in non competing industries makes it difficult to benchmark with these firms. Your efforts will be wasted unless you fully understand your own proccesses before you benchmark someone else. Benchmarking is time consuming and costly.
Joseph Juran
Took a more strategic and planning perspective than Deming. Called Juran trilogy- Planning, control, and improvement -starts with planning. The purpose of quality is to provide the operating forces with the means of producing products that can meet the customers needs. Once planning is complete, turned to operating forces. Job is to produce product. Control Vs. Breakthrough-- control is a process related activity that ensures processes are stable. Control involves gathering data about a process to ensure the process is consistent. Breakthrough improvement implies the process has been studied and that some major improvement has resulted in large nonrandom improvement in the process. Should occur simultaneously. Project by project impoverishment- Workers take on projects with the language of things, managers with the language of money. Pareto analysis- Pareto's law or 80/20 law. Basically says majority of quality problems result of relatively few causes.
David Garvin 5 definitions of quality
Transcendent, Product based, user-based, manufacturing based, value based
Responsiveness
Willingness of the service provider to be helpful and prompt in providing service.
Two critical factors of success for reengineering
breadth refers to the impact of the reengineering process to the entire organization. Depth refers to organizational elements such as responsibilities measures, info tech, and skills
Quality control
control process is based on the scientific method which includes the phases of analysis, relation, and generalization. Analysis phase a process is broken down to fundamental pieces. Relation involves understanding the relationship between the parts. Generalization involves perceiving how interrelationships apply to the larger phenomenon of quality. Monitoring process capability and stability Measuring process performance Reducing process variability Optimizing processes to nominal measures Performing acceptance sampling Developing and maintaining control charts
Management by fact
dictates the decisions are made based on the sound collection of analysis of data.
Gaps approach to service design
differences between desired levels of performance and actual levels
Target firm
firm being studied. Not static will interchange with initiator time to time
initator firm
firm that studies another
Quality assurance
guaranteeing the quality of a product or service. Often design related. Quality control is reactive rather than proactive by detecting quality problems after occur. Failure to mode and effects analysis Concurrent engineering Experimental design Process improvement Design team formation and management Off-line experimentation Reliability/ durability
clickstream info
how a customer navigates a website
Value added perspective
involves a subjective assesment of the efficacy of every step of the process for the customer.
Knowledge management
managing the mountain of information generated by web site usage in a way to improve marketing to key customers
Single factor productivity
output/(a single input)
Total-Factor productivity
output/(sum of all inputs to production)
Multiple factor productivity
output/(the sum of multiple inputs)
Three spheres of quality
quality control quality assurance, quality management
Churn reduction
reduction of losing customers by actively pursuing those in danger of leaving
Conversion process.
the process in which we align the inputs together to form the product or service. Turning sheet steel into chimney pipes. Two feedback loops, control process and then customer feedback
Annuity relationship- customer provides long term steady income stream to the provider
yeah what i just said
