Operations and Supply Chain Mgmt
Building Quality into Product
* Product Design: This is how the product, either a good or a service, functions. It determines the features, functions, aesthetics, and performance of a product, which are essential parts of the product's quality. Product design also determines the reliability, durability, serviceability, and other key quality elements. * Process Design: This is how the product, either a good or a service, is produced. Process design includes the methods that the firm uses to transform the product ideas created in the product design into the good or service that the customer is purchasing. * Work Execution: This is the performance of the plan created in the product and process design. * Inspection: This is an assessment of the quality of the good or service. If the first three steps are properly performed, inspection is, theoretically, unnecessary. Inspection provides feedback about how well the product is designed and built. Its primary benefit is to identify quality problems and connect them to their sources.
Questions gauging customer's expectations!
1) Ask customers what they want. 2) Ask customers specific questions about attributes of the product that are not mentioned by the customer: Probing the customers with specific questions about their needs may lead to unspoken expectations. 3) Ask customers about their operations or how they will use the product: Knowing how the customer functions and how they use the product can lead to a better understanding of what and how new ideas and technologies could help them. 4) Ask customers how their customers use the products: Knowing the needs of the customers' customers can help the organization better understand the impact of its product on the value-creation chain and, therefore, meet the needs of the final customer in this chain.
Key components to Continuous Improvement
1) Assign teams to ID areas for improvement. - cross-functional teams 2) Use methods analysis and problem-solving tools - process flow analysis; poka-yoke 3) Use Plan-Do-Check-Act cycle 4) Document improved procedures
Methodology of Six Sigma
1) Define - uses project charter to define a problem or an improvement opportunity. Includes scope of project, problem statement, boundaries, and team members. Voice of customer - VOC, Value Stream mapping, SIPOC chart (supplier-input-process-output-customer relationship) 2) Measure - measuring current, or as is process performance Is accomplished with a process map of activities performed at each step of the process. 3) Analyze - charts and diagrams used to visualize the measurements and the frequency of problems or defect. Main objective is to determine root causes of variation in process that result in failures and defects. - failure modes and effects analysis (FEMA) 4) Improve - current process is changed by addressing the root causes identified in the analysis stage to improve process performance. Simulations, Realtime through the design of experiments (DOE) DOE solves problems within complex systems or processes that have many different factors that are not easily isolated from other factors. (There is no independent-dependent variable relationship). Improvements are often made through kaizen teams that can make rapid changes using ideas from the people who are directly involved in the process. 5) Control - Maintaining and standardizing the improved performance is the final step of the DMAIC methodology. This can be accomplished through a control plan to document the requirements to reduce process variation. May include SPC or 5S Methodology (sort, straighten, shine, standardize, and sustain). DMAIC Process
Quality of Goods
1) Performance—primary operating characteristics of a product. 2) Features—secondary characteristics that supplement the product's basic functioning. 3) Reliability—length of time a product will function before it fails, or the probability it will function for a stated period of time. 4) Conformance—degree to which a product's design and operating characteristics match pre-established standards. 5) Durability—ability of a product to function when subjected to hard and frequent use. 6) Serviceability—speed, courtesy, and competence of repair. 7) Aesthetics—how a product looks, feels, sounds, tastes, or smells. 8) Perceived Quality—image, advertising, or brand name of a product.
Costs of Quality
1. Failure Costs - can be internal to organization (before reaches customer) or external involving customer (after reaches customer including loss of goodwill and/or liability) 2) Appraisal Costs - Investment in measuring quality and assessing customer satisfaction; inspect and test products. 3) Prevention Costs - put a stop to the quality costs such as employee training, quality control procedures, special efforts during product design, or administrative systems to prevent defects.
Service Quality
1. Reliability 2. Responsiveness 3. Assurance 4. Empathy 5. Tangibles
If a hotel guest wished to read a newspaper after the gift shop had closed and the waiter found a newspaper in the restaurant, it would be an example of
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Six Sigma
A business process for improving quality, reducing costs, and increasing customer satisfaction by a firm's ability to produce error-free products. Uses quantitative and qualitative techniques and tools. Statician - six standard deviations rather than three standard deviations 3 deviations = 2.6 defects per 1,000 units - 99.74@ error free 6 Deviations 3.4 defects per 1,000,000 units = 99.999966% error free
design a tray that will hold all of the necessary components and can be pre-packed prior to final packaging in the box
A tray to hold all parts of each shipment was designed so missing parts would be easily identified.
The Plan-Do-Check-Act Cycle
AKA Deming Wheel / Shewhart Cycle Continuous Improvement Plan—Before making any changes, be sure everything is documented and standardized. Use appropriate tools to identify problems or opportunities for improvement. Develop a plan to make changes. Do—Implement the plan and document any changes made. Check—Analyze the revised process to determine if goals have been achieved. 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.
After comparing different sedans, Tanya purchases a Toyota Camry instead of a Honda Accord because she prefers the appearance of the Camry. Tanya makes her decision based on the -Select- dimension of quality.
Aesthetics
Describe 2 activities that need to occur in the "Plan" stage of the Plan-Do-Check-Act cycle.
All processes and procedures need to be documented and standardized. Use analysis tools to identify problems or suggest improvements. Develop a plan to make changes.
Quality Function Deployment (QFD)
An approach that integrates the "voice of the customer" into both product and service development
Total Quality Management (TQM)
An approach to quality that embodies the following components: 1) Focus on the customer - Juran quality as fitness for use - voice of customer by focus group 2) Quality function deployment 3) Responsibility for Quality 4) Team problem-solving 5) Employee Training 6) Fast-based management
________ are incurred when a company evaluates customer satisfaction.
Appraisal costs
Where are check sheets generated?
At the site where the data is generated.
Which of the following are examples of Service Quality from the Southwest Airlines scenario? (Select all that apply). a) low fares b) reliable service c) first come, first-served seating
B & C
Fact-Based Management
Basing decisions on facts, data and analysis instead of intuition or inference. What gets measured gets attention. -quality, complaints, supplier satisfaction
In the product defect scenario, the Pareto chart involving warranty claims was analyzed by you, your boss, and
CFO
Fishbone Charts
Cause and Effect / Ishikawa Diagrams Show the impact of various inputs into the result of a process. Isolate root causes of problems such as bottlenecks in their processes.
What process was instituted to determine the extent of missing parts in the product boxes?
Checklist
Group decision-making is very useful when building to the selected alternative.
Commitment
Broader Measures of Performance
Companies have traditionally measured their performance using the accounting standards of cost and profit. Today, those standards alone are insufficient. Quality is an important performance measure that must be used, especially by companies using TQM. Customers' needs may include other factors such as delivery speed, flexibility, or innovation, therefore, the performance measurement system must also include these factors. Standardization and documentation form the basis of continuous improvement. Standardization involves developing a preset procedure for performing an activity or job. Documentation is the act of putting that procedure into writing. Standardization and documentation are necessary for continuous improvement so the organization knows exactly how something is being completed now (the "as is" condition). After the process has been improved, the firm should document the new procedure (the "should be" condition) so that it becomes the new standard procedure. Documentation and standardization are especially important for companies that want to become registered under ISO 9000:2000, which is a widely-used international quality standard.
Philosophies of Quality Management
Compare the characteristics of globally-recognized quality management philosophies. 1) W. Edwards Demings - 14 Points for the Transformation of Management - Statistical Process Control (SPC) 2) Joseph M. Juran - emphasized management's responsibility for ensuring quality, "fitness for use." and continuous improvement in quality planning, quality control and quality improvement. Focus on Customer. 3) Philip Crosby - Quality is free - failure costs are much greater than companies thought, reducing failure costs, companies can save money. Promote eliminate all errors - "do it right the first time". 4) Genichi Taguchi - developed procedures for designing experiments so that more info could be obtained with fewer experiments. Quality must be designed into a product. Robust design process. 5) Kaoru Ishikawa - Developed methodologies help ID cause-and-effect characteristic and to develop teamwork for quality leadership. Fishbone diagram helps to ID factors that may contribute to dependent outcomes. Main factors - People, Machines, Methods, Measurements, Materials and Environment. Developed Quality circles - groups that meet to discuss, analyze and eliminate work-related quality issues.
Teams that work together across departments in an organization are called .
Cross-functional teams
Successive Houses of Quality
Customer Needs/Design >> Design Characteristics/parts characteristics >> Parts Characteristics /Operational Process >> Operational Process /Process Requirements
Which of the following would be an external measurement of quality?
Customer Satisfaction
House of Quality
Customer needs - WHATS Design characteristics - HOWS Importance to customers - WHY Target Value, competitive Assessment - HOW MUCH WHAT VS HOW mix - middle - relationship matrix HOW VS HOW - roof - correlation matrix
Documentation of changes made to the plan occurs in the -------- part of the Plan-Do-Check-Act cycle.
DO
The quality control expert, , believed that employees should be trained to use statistical process control.
Deming
A Pareto chart represents data values, in what order, to visualize the most frequent occurrences?
Descending
Quality function deployment relates customer needs to which of the following?
Design Characteristics
Quality in Different Types of Organizations
Differentiate the characteristics of quality for service and manufacturing organizations.
is the process of putting a procedure into writing.
Documentation
Explain why the documentation of procedures is important.
Documentation is needed for continuous improvement and to ensure the procedure is done the same way every time. Also, companies can compare the new procedure against the old procedure. Finally, companies wishing to be registered under ISO 9000:2000, an international quality standard, must provide documentation.
Responsibility for Quality
Everyone from CEO to bottom - Suppliers
Define the problem Statement
Explain how Six Sigma is used for quality management. Apply the correct quality management tools to a problem.
Statistical Process Control
Explain how the most common tools are used in quality management programs. statistical process control (SPC) is 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.
Philosophy of Continuous Improvement
Explain some of the possible strategies used in quality management programs. - Deming, Juran and Crosby
Firms only need to ask customers what they want to ensure they understand the customer's expectations.
False Correct. Asking customers what they want is useful and provides important information, however, it is not sufficient. Organizations must go beyond asking customers what they want and understand what their customers value, including how they do their work, what makes their customers happy, and feedback on specific attributes of the product.
True or False. According to Dr. W. Edwards Deming, in a manufacturing environment, quality improves when management establishes very specific work quotas.
False Correct. Deming advocated the elimination of work standards (quotas) on the factory floor. He asserted that leadership not quotas would improve quality.
True or False. According to Genichi Taguchi, high levels of quality are achieved when a company closely inspects products after they are manufactured and before they are sold to customers.
False Correct. Taguchi argues that quality must be designed into a product. His point is that quality cannot be achieved through inspections after the good is made or the service is provided.
The Ishikawa diagram is also known as the _________.
Fishbone Diagram
A company's attempt to get to know its customers by contacting them to discuss their needs, wants, and expectations is done in a _________.
Focus Group
A histogram, or box chart, demonstrates ___________________.
Frequency of values in a given range
The concept of "Robust Design" is attributed to which quality management expert?
Genichi Taguchi
The concept of robust design is a core part of _________________ quality philosophy.
Genichi Taguchi
The perfecting of experiments to create higher quality products and processes is best associated with which quality management expert?
Genichi Taguchi
Which Quality Management expert worked with Japan's phone industry to improve its operations?
Genichi Taguchi
Decision-making can be moved to the front line employee because workers have become more __ ,.
Highly skilled
Mistake proofing
Improving processes to prevent mistakes or to make mistakes obvious at a glance; also called error-proofing
In a scatter plot, the controlled variable is called the -Select-ivariable.
Independent
A scatter plot is normally used only when one variable can be -Select-t-.
Influenced
Quality Management
Integral component - good versus poor quality Describe quality from both a consumer and organizational point of view.
Product characteristics and attributes are the basis for measuring quality if a company has an -Select- oriented definition of quality.
Internally
Philosophy of Employee Empowerment
Involving employees in every step from product design, process design, and system design. - improve morale, organizational efficiency, product and service quality, higher customer satisfaction Techniques: 1) Develop supportive supervision and complementary workforce development programs, such as team projects, quality circles, or team performance evaluations 2) Building transparency through open communication and decision-making that involves employees at all levels of the organization. 3) Enlarging jobs by moving responsibility and authority from managers and staff to the lowest level possible in the organization.
Employee Training
It has been shown that employees need training to work effectively in groups and to use group problem-solving tools. 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.
The idea that product or service quality could be described as "fitness for use" is associated with which Quality Management expert?
Joseph Juran
____________________'s quality process relied on the customer's perception of quality as the ultimate measure, rather than simply following product specifications.
Joseph Juran
What term is used in six sigma to describe changes made as errors occur? -
Kaizen
The idea that teamwork is essential for quality leadership can be attributed to which quality management expert?
Kaoru Ishikawa
According to Joseph Juran, -Select- are primarily responsible for ensuring that a company manufactures quality products.
Managers
What type of variables can be measured in the warranty defect scenario?
Measurable variables in this scenario would be things such as paint scratches, improper packaging, and missing parts.
Quality Function Deployment
Method used to make the transformation by relating customer needs and expectations to specific design characteristics through a series of grids or matrices. Ex House of Quality
Name two reasons why team problem solving is better than individual problem solving.
More viewpoints, more access to information, broader knowledge, brainstorming possibilities, divide up the workload
Since a bolt will be used in exterior applications, it should be galvanized. If the galvanizing process lays down a 60-mil thickness of nickel. This measurement represents quality from the --- point of view.
Orgnization
Name one technique or chart used in group problem solving.
Pareto charts, fishbone diagrams, house of quality
Which Quality Management expert used the phrase, "Do it right the first time"?
Philip Crosby
Who wrote a book in 1979 entitled "Quality is Free"?
Philip Crosby
Which of the following is an example of a problem-solving tool that can be used in continuous improvement?
Process flow analysis
Internal Organization Oriented Definitions of Quality
Quality is the degree to which a specific product conforms to its design characteristics or specifications. Quality can be measured as the amount of a specific, desired attribute.
External Consumer Oriented Definitions of Quality
Quality with an external orientation focuses on the customer, and typically includes a discussion of "fitness for use." In other words, quality cannot be effectively measured in the abstract. Quality is the capacity to satisfy customers' needs.
The Plan-Do-Act-Check cycle is known as the Deming Wheel or the _____________.
Shewhart cycle
The best definition of standardization is:
Standardization involves developing a present procedure for performing an activity or job.
Companies today realize that facts, data, and -Select-are needed to make decisions.
Statistical Analysis
Is the following statement true or false? It is possible to think of the different departments in a company as customers.
TRUE
True or False. According to Philip Crosby, most firms underestimate their failure costs and would benefit from evaluating all costs of quality.
TRUE
True or False. An auto mechanic who correctly repairs a customer's transmission illustrates the service quality dimension of reliability.
TRUE
True or False. Understanding how customers use products and services helps companies to develop new technologies that improve and achieve external quality.
TRUE
While assembling a rolling table, you notice the bolts attaching the casters are rubbing against the wheels and preventing them from turning. If the casters were attached with shorter bolts, then the wheels would turn. Defining quality for this bolt needing to be shorter is defining quality from a customer perspective.
TRUE Correct. Based on the "fitness for use" if the caster wheels cannot turn, then the bolt length is unsatisfactory and will not work for the customer.
As more and more companies realize the importance of teams in problem solving and decision making, some issues have arisen. Employers realize that employees need training in order to work in .
Teams
When families visit Disney World Theme Parks they often have to wait in long lines for rides. Some strategies have been developed to make the wait time more bearable. Which of the following could be an example of how a team solved the problem?
Television monitors are placed along the wait line with interesting stories and animated content to entertain the visitors.
Name one tool that could be used to define the warranty defect problem.
The define stage can involve the "Voice of the Customer" or VOC. This is includes feedback regarding characteristics that are critical for satisfaction of the customer. Another tool is Value Stream Mapping to provide an overview of an entire process, from beginning to end, with regard to the VOC. A SIPOC chart defines the Supplier-Input-Process-Output-Customer relationships in a process.
Definition of Quality
The definition of quality has both an organizational, or internal, orientation—quality from the company's perspective, and a consumer, or external, orientation—quality from the customer's perspective.
Historically, the responsibility for quality control fell on which of the following?
The quality control department
The six sigma expert uses a project charter to define a problem or improvement opportunity. What is included in a project charter?
The scope of the project, problem statement, time frame, boundaries, and team members.
Statistical Process Control (SPC)
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. Walter Shewhart - father of statistical quality control. Founding father of statistical process control. Developed the P-D-C-A (Plan Do Check Act) which came to be known as Shewhart Cycle, and also the Deming Wheel. However, Deming preferred to call it the Shewhart Cycle. Deming later revised it to P-D-S-A (Plan Do Study Analyze) because he felt "check" emphasized inspection over analysis.
Seven basic tools of statistical process control
There are seven basic tools of SPC. 1) Cause-and-effect diagrams or fishbone diagrams or Ishikawa diagrams - see below 2) Check sheets - data collection in real-time at site where data generated 3) Control charts - graphical depictions of process output where the raw data is plotted in real-time within upper (UCL) and lower (LCL) control limits. As each data point is collected, it is recorded on the control chart in relation to the process mean and the UCL and LCL. In this way, the process operator can instantly determine whether the process is stable or trending toward instability and take corrective action BEFORE variations result in non-conforming products. Analysis Tools (histograms, scatter diagrams, and Pareto charts) 4) Histograms - frequency of data observations within a preset range of values - probability 5) Pareto charts - represents data values in descending order to visualize the most frequent occurences 6) Scatter diagrams - displays data as a relationship betw/ 2 variables - usually used when one variable can be influenced in different quantities, degrees or proportions, while other variable can be monitored for effects resulting from the changes. Controlled variable = independent variable. 7) Flow charts or run charts - are another form of control chart for processes that might have common features, a common scale, or some form of central tendency.
The 14 Points for the Transformation of Management
This was Dr. W. Edwards Deming's guide for organizational leadership to better use their role to improve the effectiveness of any organization. These come from Dr. Deming's book, "Out of the Crisis" 1. Create constancy of purpose toward improvement of product and service, with the aim to become competitive and to stay in business, and to provide jobs. 2. Adopt the new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn their responsibilities and take on leadership for change 3. Cease dependence on inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place. 4. End the practice of awarding business on the basis of price tab. Instead, minimize total cost. Move toward a single supplier for any one item, on a long-term relationship of loyalty and trust. 5. Improve constantly and forever the system of production and service, to improve quality and productivity and thus constantly decrease costs. 6. Institute training on the job. 7. Institute leadership. The aim of supervision should be to help people and machines and gadgets to do a better job. 8. Drive out fear, so that everyone may work effectively for the company. 9. Break down barriers between departments. People in research, design, sales and production must work as a team, to foresee problems of production and in use that may be encountered with the product or service. 10. Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force. - Eliminate work standards (quotas) on the factory floor. Substitute leadership - Eliminate management by objective. Eliminate management by numbers, numerical goals. Substitute leadership 11. Remove barriers that rob the hourly worker of their right to pride of workmanship. The responsibility of supervisors must be changed from sheer numbers to quality. 12. Remove barriers that rob people in management and engineering to their right to pride of workmanship. This means, inter alia, abolishment of the annual or merit rating and of management by objectives. 13. Institute a vigorous program of education and self-improvement. 14. Put everybody in the company to work to accomplish the transformation. The transformation is everybody's job.
The House of Quality can help a company evaluate .
Trade-offs
True or false. If quality is defined from an external perspective, then a company focuses on identifying and meeting customers' needs.
True
Which Quality Management expert felt that the "system" caused defects, not employees?
W. Edwards Deming
Which of the founders of quality management endorsed the elimination of fear in the organization?
W. Edwards Deming
Which of the founders of quality management outlined his strategy for the transformation of management to promote quality methods in 14 points?
W. Edwards Deming
Which quality management expert recommended eliminating work standards on the factory floor?
W. Edwards Deming
Who created a 14 point plan for quality improvement in an organization?
W. Edwards Deming
Certain kinds of questions help firms understand their customers expectations. Among the following, what types of questions should firms ask when they want to understand customers' expectations? Select all that apply.
X Questions about specific needs. > Questions about operations or how they will use the product. >Questions about how their customers will use the product. Check My Answer Correct. Knowing how the customer functions and how they use the product can lead to a better understanding of what and how new ideas and technologies could help them. Knowing the needs of the customers' customers can help the organization better understand the impact of its product on the value-creation chain and, therefore, meet the needs of the final customer in this chain.
Fishbone diagram
a visual aid that helps organize cause and effect relationships for "things gone wrong"
Philosophy of Benchmarking
process by which a company compares its performance to the performance of other companies to set a standard based upon the company that is recognized as the best at a certain activity. Ex L.L. Bean as a benchmark for online ordering and order fulfillment.
