Operations Management Ch. 4

problem statement example

1. a concise verbal statement of the problem under study

check sheets

1. record data points in real time at the site where the data is generated 2. this is often the first tool used to assess a process and often the data is "raw" meaning it is straight from the source and without any interpretation 3. formatted to provide structure to the process of collecting data by different observers 4. once the data is collected on the check sheets, then it needs to be analyzed and interpreted 5. the analysis tools are histograms, scatter diagrams, and Pareto charts 6. the raw data is graphically demonstrated by alternative means to visualize trends in the process

quality function deployment (QFD)

1. relates customer needs and expectations to specific design characteristics through a series of grids or matrices 2. the quality of a product, whether that product is a manufactured good or a service is largely dependent on how well the product and the processes for producing it were designed 3. the needs and expectations of the customers must be transformed into design characteristics for the product and process 4. the basic form of the matrix used in QFD is often called the house of quality

The Plan-Do-Check-Act Cycle

-also referred to as the Deming wheel or the Shewhart cycle -the shape of a wheel embodies the philosophy of continuous improvement (repeated over and over without end) 1. Plan -before making any changes, make sure everything is documented and standardized. -Use appropriate tools to identify problems or opportunities for improvement. -Develop a plan to make changes 2. Do -implement the plan and document any changes made 3. Check -analyze the revised process to determine if goals have been achieved 4. Act -if the goals have been achieved, then standardize and document the changes -communicate the results to others that could benefit from similar changes -if the goals have not been achieved, determine why not, and proceed accordingly

total quality management (TQM)

-continuous improvement -leadership development -partnership development 1. an approach to quality management that originated in Japan and was adopted successfully by many companies 2. organization wide philosophy that embodies: -focus on the customer -quality function deployment -responsibility for quality -team problem-solving -employee training -fact based management 3. applies to all aspects of a company's operations, from design of products and processes to distribution and after-the-sale service 4. all parts of he company must be involved

employee training

1. Deming emphasized the importance of training employees to use the tools of statistical process control 2. as organizations adopt a team approach to problem solving, it has been shown that employees need training to work effectively in groups and to use group problem-solving tools 3. Pareto Charts that identify the most frequent causes of quality problems, cause and effect diagrams that illustrate the root cause for a problem, and quality control charts that assess quality conformance are just three of many techniques

philosophy of benchmarking

1. a process by which a company compares its performance to the performance of other companies -other companies need not be competitors, nor be within the same industry 2. instead, the purpose of benchmarking is to set a standard based upon the company that is recognized as the best at a certain activity 3. a benchmark does not define the best possible outcome; it only identifies what a company has achieved 4. choosing the wrong companies to benchmark can lead to setting standards that are too low 5. as a result, a benchmark is only one piece of information that companies should use to set performance goals for quality or any other important outcome

philosophy of employee empowerment

1. another strategy used in quality management programs is employee empowerment, defined as involving employees in every step from product design, to process design, and system design 2. as the work force becomes more highly skilled, decision-making authority and responsibility can be moved to individual contributors in front-line processes or to the lowest level possible in the organization 3. techniques for developing an empowered workforce: -developing supportive supervision and complimentary workforce development programs, such as team projects, quality circles, or team performance evaluations -building transparency through open communication and decision making that involves employees at all levels of the organization -enlarging jobs by moving responsibility and authority from managers and staff to the lowest level possible in the organization 4. creating a workforce of empowered employees can improve employee morale, organizational efficiency, product, and service quality, and ultimately lead to higher customer satisfaction

run charts

1. are another form of control charts for processes that might have common features, a common scale, or some form of central tendency

histograms

1. box chart 2. set ranges 3. will demonstrate which range of values contains the most observations--regardless of the actual measurement 4. frequency and probability can be determined from a histogram, but there is little other quantitative value

focus on the customer

1. can be external and internal; can be anyone, whether inside or outside an organization, who receives the output from an activity or process 2. Juran's definition of quality as fitness for use provides the groundwork for focusing on the customer 3. companies that use TQM rely on what is called "the voice fo the customer" describes what customers want and what they like and do not like -listening to the voice of the customer is essential for success -to do this, many companies get to know their customers personally -ex. focus group; ask customers how the customer uses their product -when the company knows its customer, it can meet their needs and expectations

six sigma: analyze

1. charts and diagrams are used to visualize the measurements and the frequency of problems or defects (including: scatterplots, Pareto charts, histograms, and run charts) 2. the main objective of the analysis phase is to determine the root causes of variation in the process that result in failures or defects 3. tools used in the analysis phase are cause and effect analysis, such as the fishbone diagrams described above; failure modes and effects analysis (or FMEA) for identifying possible causes of defects, errors, breakdowns, or failures; and statistical analysis, such as multiple regression, and hypotheses testing to detect different types of variation within a process 4. the analysis phase can also include measurement system analysis is to determine the accuracy and repeatability of the measurement methods and devices used to control variation in the process

broader measure of performance

1. companies have traditionally measured their performance using the accounting standards of cost and profit 2. standardizing and documenting procedures form the basis of continuous improvement -necessary for continuous improvement so that the organization knows exactly how something is being completed now -after the process has been improved ("as is"), the firm should document the new procedure (the "should be") so that it becomes the new standard procedure -it is to ensure that with a given process, each person performs a task the same way every time -as better ways are found, the documentation and standardization are changed to promote continuous improvement

fact-based management

1. companies that use TQM must determine what their customers' needs and expectations really are, not what the company thinks they are 2. this philosophy of basing decisions on facts, data, and analysis-instead of intuition or inference-extends to other areas of the TQM company 3. companies are realizing that those criteria must tie into the company's competitive strategy -as a result, some of the most important measurements today are those related to quality -measurements of quality are internal and external 4. product quality and satisfaction of the final customer are determined by all of the participants in the supply chain

component of continuous improvement: method analysis and problem-solving tools

1. continuous improvement efforts require a set of methods or problem-solving tools 2. the type and application of these tools depends upon the outcome measures that need to be enhanced 3. useful to determine the process flow, identify essential tasks, and note tasks that can be reduced in length or eliminated completely 4. it would also be useful to identify which quality problems are the most common and to overlay those on the process flow to see how cost and quality interact

scatterplot

1. displays data as a relationship between two variables 2. usually, this is only used when one variable can be influenced in different quantities, degrees, or proportions, while the other variable can be monitored for effects resulting from the changes 3. controlled variable: independent variable 4. measured variable: the dependent variable

control charts

1. graphical depictions of process output where the raw data is plotted in real-time within upper (UCL) and lower control limits (LCL) 2. as each data point is collected, it is recorded on the control chart in relation to the process mean and the UCL and LCL 3. in this way, the process operator can instantly determine whether the process is stable or trending toward instability and take correct reaction before variations result in non-conforming products

responsibility for quality

1. in the past, many companies used quality control (QC) departments to ensure quality -unfortunately, this practice allowed others in the organization to assume that the quality department was solely responsible for quality 2. organizations that embrace TQM realized that everyone must accept responsibility -in addition, company suppliers must also accept responsibility for their role in quality.

standardization

1. involves developing a preset procedure for performing an activity or job

six sigma: control

1. maintaining and standardizing the improved performance is the final step 2. can be accomplished through a control plan to document the requirements to reduce process variation 3. the control plan may include SPC to maintain process stability 4. also mistake proofing a product or a tool can make errors immediately detectable 5. another tool for control is the 5S methodology (sort, straighten, shine, standardize, and sustain -the 5S methodology creates visual control of the workplace 6. a secondary methodology of six sigma is the DMADV process -this is used specifically for new products or processes, and it is also known as design for six sigma (DFSS) -define, measure, analyze, design, and verify

six sigma: improve

1. may have a visual control 2. the current process is changed by addressing the root causes identified in the analysis stage to improve process performance 3. this can be accomplished offline through simulations, or in real time through the design of experiments (DOE) 4. DOE solves problems within complex systems of processes that have many different factors that are not easily isolated from factors (there is no independent-dependent variable relationship) 5. improvements are often made through kaizen teams that can make rapid changes using ideas from the people who are directly involved in the process

six sigma: measure

1. measuring current, or as is process performance is accomplished with a process map of the activities performed at each step of the process 2. each step is assessed to determine the ability to meet customer specification in a capability analysis

Pareto Chart

1. most frequent occurrences 2. represents data values in a descending order to visualize the most frequent occurrences 3. similar to a histogram because of the preset range of values, which might be qualitative or quantitative 4. but the difference from a histogram is that a Pareto charts always reflect the data in descending order to emphasize the most common occurrences among the data points 5. SPC uses these charts to determine the variability of processes and can be used to visualize and solve a majority of quality management issues -from these observations and analysis, one can begin to determine the process mean (average) and standard deviation -then, statistical methods are used to calculate upper and lower control limits that will quantify when a process is in control (and making "good" products) or out-of-control (and making non-conforming products)

six sigma: define

1. problem statement 2. uses a project charter to define a problem or an improvement opportunity 3. the charter includes: the scope of the project, problem statement, time frame, boundaries, and team members 4. can also involve the voice of the customer -feedback regarding characteristics that are critical for the satisfaction of the customer 5. another tool in the define stage is value stream mapping -provides an overview of an entire process from beginning to end, with regard to the VOC and identifies what is required to meet the customer's needs 6. a SIPOC chart defines the supplier-input-process-output-customer relationships in a process

Team problem solving

1. problems can be solved better by a team than by one individual 2. team efforts to problem solve allow for different view points and also enable the team members to split the work load and brainstorm possible solutions with one another 3. may be more effective -one person may not have access to all the information, nor have the broad range of knowledge needed to understand the problem design alternative solutions and select the best approach 4. group decision-making is also very useful when building commitment to the selected alternative -convincing people to use a new approach is easier when each person is involved in the decision making process

six sigma

1. relates to the firm's ability to produce error-free products 2. seeks to reduce variation in the processes that lead to product defects 3. 3.4/1,000,000 -depends on the company (like an airplane wants 0 crashes) 4. six sigma increases expectations and attempts to decrease defects drastically 5. uses quantitative and qualitative techniques and tools 6. the main methodology of six sigma follows five steps DMAIC: define, measure, analyze, improve, and control

Fishbone/Cause and Effect/Ishikawa Diagrams

1. show the impact of various inputs into the result of a process 2. they help organizations isolate the root causes of problems such as bottlenecks in their processes 3. data collection is a fundamental task within SPC

six sigma black and green belts

1. six sigma helps the firm make its processes consistent because when six sigma is achieved 2. develops a cadre of specialists who are experts in specific methods 3. it is common for highly placed executives in the firm to be black belts and to train new green belts and black belts

component of continuous improvement: identify areas for improvement

1. teams of employees from different departments work together as cross functional teams to understand the current conditions and prepare a method to improve the performance of an organizational activity 2. it is important to have various experts examine and improve the process 3. these experts should understand the roles of marketing, production, and information technology -they should also understand the accounting and financial aspects of this complicated process

documentation

1. the act of putting that procedure into writing

philosophy of continuous improvement

1. the philosophies of Deming, Juran, and Crosby emphasize continuous improvement 2. this philosophy of continuous improvement is an extremely important part of TQM 3. companies adopting continuous improvement as an organizational philosophy have found that the following key components are necessary -assign teams to identify areas for improvement -use methods analysis and problem-solving tools -use the Plan-Do-Check-Act Cycle -document improved procedures 4. Kaizen: Japanese term for continuous improvement. -a step by step improvement of business processes

component of continuous improvement: document improved procedures

1. the process for continuous improvement ends in the same place it begins with a documented process, so that future review for the purpose of process improvement commences again here 2. documents are also valuable for training new employees 3. finally, documentation is essential to achieve quality certification

statistical process control

1. the use of statistical methods to determine when a process that produces a good or service is getting close to producing an unacceptable level of defects 2. in a broader sense, SPC relates to the set of tips, techniques, and tools used to monitor variations in a process, determine the stability of a process, and reduce or eliminate variations that result in non-conforming products that are either defective or do not meet customer's specifications 3. basic tools -cause and effect diagrams or fishbone diagrams or ishikawa diagrams -check sheets -control charts -histograms -pareto charts -scatter diagrams -flow charts or run charts

QFD House of Quality

A graphic technique that utilizes a planning matrix to relate customers "wants" to "how" the firm is going to meet those "wants" (how quality effort will be deployed) 1. the customer needs, or the "whats" are listed along the left-hand side of the matrix 2. design characteristics related to these needs are listed along the top as "hows" 3. the relationship matrix in the middle (the what vs. how) indicates the nature of the relationship between each customer need and each design characteristic -how each design characteristic affects other design characteristics 4. why importance to customers, customer POV: about how well the company is doing in comparison to its competitors 5. performance on each design characteristic can be compared against competitors along the bottom 6. each process has a house -further, all parts of the organization work together to achieve that deployment