9: Ensuring High Quality and Productivity

Identify an example of process control.

A city's park district asks its maintenance crew to suggest ways to keep its parks clean and attractive.

value

A customer's subjective assessment of benefits relative to costs in determining the worth of a product

Average rate of return (ARR)

A percentage that represents the average annual earnings for each dollar of a given investment.

Lean process improvement

A practice that considers any costs other than a cost that adds value for a customer to be wasteful and , hence, something to be eliminated

six sigma

A process-oriented quality-control method designed to improve the product or service output to 99.99 percent perfect.

zero-defects approach

A quality-control technique based on the view that everyone in the organization should work toward the goal of delivering such high quality that all aspects of the organization's goods and services are free of problems.

Identify a true statement about an employee involvement team in an organization.

An employee involvement team is most successful when every group member is eager to participate.

total quality management (TQM)

An organization-wide focus onsatisfying customers by continuously improving every business process for delivering goods or services.

Identify a true statement regarding the output in a production process in an organization.

Employees feel unhappy when output is increased while quality is sacrificed.

Identify a consequence of improved productivity of organizations in a country.

Employers tend to pay higher wages and salaries to productive workers.

Identify a way managers can boost productivity.

Improve process quality so that employees work more efficiently

Identify a consequence of poor quality of production in an organization.

It becomes difficult to attract resources.

Identify a true statement about the guidelines for quality control.

It is more efficient to design and build quality into a product than to try to improve the product later.

Identify a true statement about lean manufacturing.

It refers to continually identifying and eliminating waste through the use of a variety of assessment, scheduling, and production control tools.

Identify a true statement about productivity

It refers to the amount of acceptable work employees do for each dollar they earn.

statistical quality control

Looking for defects in parts or finished products selected through a sampling technique.

Identify the formula for measuring productivity.

Productivity = Outputs/Inputs

The productivity formula

Productivity = Outputs/Inputs

Identify a true statement regarding improving productivity in an organization.

Productivity is improved when output is increased without boosting costs.

_____ refers to an organization's efforts to prevent or correct defects in its goods or services or to improve them in some way.

Quality control

Which of the following is a true statement about the guidelines for quality control?

Quality control should include a prevention program to keep defects from occurring.

process control

Quality control that emphasizes how to do things in a way that leads to better quality.

product quality control

Quality control that focuses on ways to improve the product itself.

__ refers to a process-oriented quality-control method designed to improve the product or service output to 99.9997 percent perfect.

Six Sigma

_____ is a quality-control technique using statistics to monitor production quality on an ongoing basis and making corrections whenever the results show a process is out of control.

Statistical process control (SPC)

detour behavior

Tactics for postponing or avoiding work.

employee involvement teams

Teams of employees who plan ways to improve quality in their areas of organization.

_____ is an annual award administered by the U.S. Department of Commerce and given to the company that shows the highest quality performance in seven categories.

The Baldrige Performance Excellence Program

Identify a true statement about turnover.

The degree to which employees feel supported by their organization directly influences their decision to stay or quit that organization.

payback period

The length of time it will take for the benefits generated by an investment (such as cost savings from machinery) to offset the cost of the investment.

statistical process control (SPC)

The process of testing statistical samples of product components at each stage of the production process and plotting those results on a graph. Any variances from quality standards are recognized and can be corrected if beyond the set standards.

turnover

The rate at which employees leave an organization.

Identify a true statement about quality standards.

They should reflect what is important to a client.

Identify a way in which supervisors can overcome the productivity constraint of management limitations.

They should show that they are interested in their department's productivity through their actions and words.

True or false: An even flow of work in a department can be costly.

This is false. An uneven flow of work in a department can be costly. When work levels are low, the result is idle time.

True or false: Total Quality Management (TQM) strategies call for the involvement of employees at the top level and prohibit the involvement of the first line of employees.

This is false. Because Total Quality Management (TQM) strategies call for the involvement of employees at all levels, an organization needs to educate its employees about why quality improvement is needed and how the TQM process will work.

True or false: The term benchmarking describes how much variation there is in a product.

This is false. The statistical term Sigma defines how much variation there is in a product.

True or false: In a basic sense, productivity is the amount of output produced with the inputs used.

This is true. The basic way to measure productivity is to divide outputs by inputs. In other words, productivity is the amount of output produced with the inputs used.

True or false: Productivity increases when output rises without a cost increase or when an organization can do as much work at a lower cost.

This is true. When supervisors and other managers look for ways to boost productivity, they often start by looking at their costs per unit of output. Productivity improves when the department or organization can do as much work at a lower cost and when output rises without a cost increase.

idle time or downtime

Time during which employees or machines are not producing goods or services.

Identify a goal of an employee involvement team.

To directly include employees in planning on ways to improve quality

Why is it necessary for employees in an organization to care about quality?

To maintain or enhance the organization's reputation

Identify a result of the poor quality of production in an organization.

Wasted time and materials

Identify a true statement about departmental work flow in a company.

When work levels are low in a department, the result is idle time.

benchmarking

a process by which a company compares its performance with that of high-performing organizations

Baldridge Performance Excellence Program

a program named for the late secretary of commerce, Malcolm Baldridge, who was a strong proponent of enhancing quality as a means of reducing the trade deficit; organizations vie for an award that promotes, recognizes, and publicizes quality strategies and achievements

quality control

an organization's efforts to prevent or correct defects in its goods or services or to improve them in some way

overhead

broad category of fixed costs that includes interest, rent, taxes, and executive salaries

A supervisor can make decisions about how to reduce costs if he or she has information on where money is being spent. The most important source of such information is a(n) _____.

budget report

A supervisor can see which categories of expenses are largest and identify where his or her department is spending more than allocated to it by regularly reviewing _____.

budget reports

Managers can improve the productivity of employees by _____.

communicating instructions clearly so that employees can live up to expectations

A true statement about lean manufacturing is that it _____.

considers costs other than a cost that adds value for a customer to be wasteful and, hence, something to be eliminated

Identify an example of an overhead.

cost of utilities

Poor-quality work in an organization can lead to _____.

high costs

Atlas Inc., a U.S.-based clothing firm, has factories in China that produce garments for sale in the United States. This practice helps Atlas cut costs since the factories function on low-cost labor. This scenario is an example of _____.

offshoring

An organization's focus to consider how to do things in a way that leads to better quality is known as _____.

process control

An organization that focuses on ways to improve a product itself uses ______.

product quality control

When a city's park district considers ways to upgrade its playground equipment, it focuses on _____.

product quality control

Jacob works at a manufacturing plant that produces spare parts for the automobile industry. He records the accuracy of the thread patterns on screws and bolts and plots this information on a control chart. This helps him monitor the production quality on an ongoing basis. In this scenario, Jacob is using _____.

statistical process control (SPC)

Productivity

the amount of results (output) an organization gets for a given amount of inputs

ISO 9000

the common name given to quality management and assurance standards

By implementing _____ in an organization, employees and managers at all levels seek to build quality into every aspect of their work.

the zero-defects approach

The rate at which employees leave an organization is known as _____.

turnover

Supervisors can help a Total Quality Management (TQM) effort succeed by behaving as if quality is important. Among TQM users, this commonly is called _____.

walking the talk

The quality-control technique where an organization works toward making its goods and services free of problems is known as the _____

zero-defects approach

Identify the consequences of improved productivity of organizations in a country.

- Goods and services will be available at low prices. - People will have access to more and better goods and services.

Identify the characteristics of quality standards.

- They should be written. - They should be challenging but achievable. - They should be measurable, clear, and specific.

In the context of quality standards, identify the categories that are evaluated for the Baldrige Performance Excellence Program.

- leadership - strategic planning - customer and market focus - measurement, analysis, and knowledge management - human resource focus - process management - results

Identify the areas that a supervisor needs to focus on when reinforcing high-quality performance in an organization.

- product - process