Bài giảng Operations Management - Chapter 6: Managing Quality

Operations ManagementManaging QualityChapter 61OutlineGLOBAL COMPANY PROFILE: MOTOROLAQUALITY AND STRATEGYDEFINING QUALITYImplications of QualityMalcolm Baldrige National Quality AwardCost of Quality (COQ)INTERNATIONAL QUALITY STANDARDSISO 9000ISO140002Outline - ContinuedTOTAL QUALITY MANAGEMENTContinuous ImprovementEmployee EmpowermentBenchmarkingJust-in-Time (JIT)Taguchi ConceptsKnowledge of TQM Tools3Outline - ContinuedTOOLS OF TQMCheck sheetsScatter Diagrams Cause-and-Effect DiagramPareto ChartsFlow ChartsHistogramsStatistical Process Control (SPC)4Outline - ContinuedTHE ROLE OF INSPECTIONWhen and Where to InspectSource InspectionService Industry InspectionInspection of Attributes vs VariablesTQM IN SERVICES5Learning ObjectivesWhen you complete this chapter, you should be able to:Identify or Define:QualityMalcolm Baldrige National Quality AwardISO International Quality StandardsDemings, Juran, and CrosbyTaguchi Concepts6Learning Objectives - continuedWhen you complete this chapter, you should be able to :Explain:Why quality is importantTotal Quality Management (TQM)Pareto chartsProcess chartsQuality robust productsInspection7To Make the Quality Focus WorkMotorola:Aggressively began a worldwide education program to be sure that employees understood quality and statistical process controlEstablished goalsEstablished extensive employee participation and employee teams 8Ways in Which Quality Can Improve ProductivitySales GainsImproved responseHigher PricesImproved reputationReduced CostsIncreased productivityLower rework and scrap costsLower warranty costsIncreased ProfitsImproved Quality9Flow of Activities Necessary to Achieve Total Quality ManagementOrganizational PracticesQuality PrinciplesEmployee FulfillmentCustomer Satisfaction10Organizational PracticesLeadershipMission statementEffective operating procedureStaff supportTrainingYields: What is important and what is to be accomplished11Quality PrinciplesCustomer focusContinuous improvementEmployee empowermentBenchmarkingJust-in-timeTools of TQMYields: How to do what is important and to be accomplished12Employment FulfillmentEmpowermentOrganizational commitmentYields: Employees’ attitudes that they can accomplish what is important and to be accomplished13Customer SatisfactionWinning ordersRepeat customersYields: An effective organization with a competitive advantage14Definitions of QualityASC: Product characteristics & features that affect customer satisfactionUser-Based: What consumer says it isManufacturing-Based: Degree to which a product conforms to design specificationProduct-Based: Level of measurable product characteristic15OperationReliability & durabilityConformanceServiceabilityAppearancePerceived qualityQualityDimensions of Quality for Goods16Under-standingTangiblesReliabilityCommunicationCredibilitySecurityResponsivenessCompetenceCourtesyAccess© 1995 Corel Corp.Service Quality Attributes17Importance of QualityCosts & market shareCompany’s reputationProduct liabilityInternational implicationsIncreasedProfitsLower CostsProductivityRework/ScrapWarrantyMarket GainsReputationVolumePriceImprovedQuality18Established in 1988 by the U.S. governmentDesigned to promote TQM practicesSome criteriaSenior executive leadership; strategic planning; management. of process qualityQuality results; customer satisfactionRecent winnersCorning Inc.; GTE; AT&T; Eastman Chemical.Malcom Baldrige National Quality Award19Costs of QualityPrevention costs - reducing the potential for defectsAppraisal costs - evaluating productsInternal failure - of producing defective parts or serviceExternal costs - occur after delivery20Costs of poor quality “are huge, but the amounts are not known with precision. In most companies, the accounting system provides only a minority of the information needed to quantify this cost of poor qualityJuran on Quality by Design, The Free Press (1992), p. 11921EC Environmental StandardISO 14000Core Elements:Environmental managementAuditingPerformance evaluationLabelingLife-cycle assessment22International Quality StandardsIndustrial Standard Z8101-1981 (Japan)Specification for TQMISO 9000 series (Europe/EC)Common quality standards for products sold in Europe (even if made in U.S.)ISO 14000 series (Europe/EC)Standards for recycling, labeling etc.ASQC Q90 series; MILSTD (U.S.)23Traditional Quality Process (Manufacturing)SpecifiesNeedCustomerInterpretsNeedMarketingDesignsProductDefinesQualityEngineeringProducesProductPlansQualityMonitorsQualityOperationsQuality is customer driven!24TQMEncompasses entire organization, from supplier to customerStresses a commitment by management to have a continuing, company-wide, drive toward excellence in all aspects of products and services that are important to the customer.25Organizational PracticesQuality PrinciplesEmployee FulfillmentAttitudes (e.g., Commitment)How to DoWhat to DoEffectiveBusinessCustomerSatisfactionAchieving Total Quality Management26Deming’s Fourteen PointsCreate consistency of purposeLead to promote changeBuild quality into the productsBuild long term relationshipsContinuously improve product, quality, and serviceStart trainingEmphasize leadership27Deming’s Points - continuedDrive out fearBreak down barriers between departmentsStop haranguing workersSupport, help, improveRemove barriers to pride in workInstitute a vigorous program of education and self-improvementPut everybody in the company to work on the transformation28Concepts of TQMContinuous improvementEmployee empowermentBenchmarkingJust-in-time (JIT)Taguchi conceptsKnowledge of TQM tools29Continuous ImprovementRepresents continual improvement of process & customer satisfactionInvolves all operations & work unitsOther namesKaizen (Japanese)Zero-defectsSix sigma© 1984-1994 T/Maker Co.30Shewhart’s PDCA Model4.Act1.Plan3.Check2.DoIdentify the improvement and make a planTest the planIs the plan workingImplement the plan31Employee EmpowermentGetting employees involved in product & process improvements85% of quality problems are due to process & material TechniquesSupport workersLet workers make decisionsBuild teams & quality circles© 1995 Corel Corp.32Quality CirclesGroup of 6-12 employees from same work areaMeet regularly to solve work-related problems4 hours/monthFacilitator trains & helps with meetings© 1995 Corel Corp.33BenchmarkingSelecting best practices to use as a standard for performanceDetermine what to benchmarkForm a benchmark teamIdentify benchmarking partnersCollect and analyze benchmarking informationTake action to match or exceed the benchmark34Resolving Customer ComplaintsBest PracticesMake it easy for clients to complainRespond quickly to complaintsResolve complaints on the first contactUse computers to manage complaintsRecruit the best for customer service jobs35Just-in-Time (JIT)Relationship to quality:JIT cuts cost of qualityJIT improves qualityBetter quality means less inventory and better, easier-to-employ JIT system36Just-in-Time (JIT)‘Pull’ system of production/purchasingCustomer starts production with an orderInvolves ‘vendor partnership programs’ to improve quality of purchased itemsReduces all inventory levelsInventory hides process & material problemsImproves process & product quality37Just-In-Time (JIT) ExampleScrapWork in process inventory level(hides problems)Unreliable VendorsCapacity Imbalances38Just-In-Time (JIT) ExampleScrapReducing inventory revealsproblems so they can be solved.Unreliable VendorsCapacity Imbalances39Tools for TQMQuality Function DeploymentHouse of QualityTaguchi techniqueQuality loss functionPareto chartsProcess chartsCause-and-effect diagramsStatistical process control40Quality Function Deployment(QFD)Determines what will satisfy the customerTranslates those customer desires into the target design41Taguchi TechniquesExperimental design methods to improve product & process designIdentify key component & process variables affecting product variationTaguchi ConceptsQuality robustnessQuality loss functionTarget specifications42Ability to produce products uniformly regardless of manufacturing conditionsPut robustness in House of Quality matrices besides functionality© 1984-1994 T/Maker Co.© 1995 Corel Corp.Quality Robustness43Shows social cost ($) of deviation from target valueAssumptionsMost measurable quality characteristics (e.g., length, weight) have a target valueDeviations from target value are undesirableEquation: L = D2CL = Loss ($); D = Deviation; C = CostQuality Loss Function44Quality Loss Function45The specifications for the diameter of a gear are 25.00 ± 0.25 mm. If the diameter is out of specification, the gear must be scrapped at a cost of $4.00. What is the loss function?© 1984-1994 T/Maker Co.Quality Loss Function Example46L = D2C = (X - Target)2C L = Loss ($); D = Deviation; C = Cost4.00 = (25.25 - 25.00)2CItem scrapped if greater than 25.25 (USL = 25.00 + 0.25) with a cost of $4.00C = 4.00 / (25.25 - 25.00)2 = 64L = D2 • 64 = (X - 25.00)264Enter various X values to obtain L & plotQuality Loss Function Solution47A study found U.S. consumers preferred Sony TV’s made in Japan to those made in the U.S. Both factories used the same designs & specifications. The difference in quality goals made the difference in consumer preferences.Japanese factory (Target-oriented)U.S. factory (Conformance-oriented)Target Specification Example48Quality Loss Function; Distribution of Products ProducedLow lossHigh lossFrequencyLowerTargetUpperSpecificationLoss (to producing organization, customer, and society)Quality Loss Function (a)UnacceptablePoorFairGoodBestTarget-oriented quality yields more product in the “best” categoryTarget-oriented quality brings products toward the target valueConformance-oriented quality keeps product within three standard deviationsDistribution of specifications for product produced (b)49PDCA Cycle4.Act:Implement the plan1.Plan:Identify the improvement and make a plan3.Check:Is the plan working2.Do:Test the plan50Tools of TQMTools for generating ideasCheck sheetScatter diagramCause and effect diagramTools to organize dataPareto chartsProcess charts (Flow diagrams)Tools for identifying problemsHistogramsStatistical process control chart51Seven Tools for TQM52Pareto Analysis of Wine Glass Defects (Total Defects = 75)72%16%5%4%3%53Shows sequence of events in processDepicts activity relationshipsHas many usesIdentify data collection pointsFind problem sourcesIdentify places for improvementIdentify where travel distances can be reducedProcess Chart54SUBJECT: Request tool purchaseDist (ft)Time (min)SymbolDescriptionlðoDÑWrite order¡ðoD ÑOn desk75¡èoDÑTo buyer¡ðnDÑExamine¡ = Operation; ð = Transport; o = Inspect;  D = Delay; Ñ = StorageProcess Chart Example55Used to find problem sources/solutionsOther namesFish-bone diagram, Ishikawa diagramStepsIdentify problem to correctDraw main causes for problem as ‘bones’Ask ‘What could have caused problems in these areas?’ Repeat for each sub-area.Cause and Effect Diagram56Too many defectsProblemCause and Effect Diagram Example57MethodManpowerMaterialMachineryToo many defectsMain CauseMain CauseCause and Effect Diagram Example58MethodManpowerMaterialMachineryDrillOvertimeSteelWoodLatheToo many defectsSub-CauseCause and Effect Diagram Example59MethodManpowerMaterialMachineryDrillOvertimeSteelWoodLatheToo many defectsTiredOldSlowCause and Effect Diagram Example60Fishbone Chart - Problems with Airline Customer Service61Uses statistics & control charts to tell when to adjust processDeveloped by Shewhart in 1920’sInvolvesCreating standards (upper & lower limits)Measuring sample output (e.g. mean wgt.)Taking corrective action (if necessary)Done while product is being producedStatistical Process Control (SPC)62Produce GoodProvide ServiceStop ProcessYesNoAssign.Causes?Take SampleInspect SampleFind Out WhyCreateControl ChartStartStatistical Process Control Steps63Process Control Chart64Control Chart65Patterns to Look for in Control Charts66Involves examining items to see if an item is good or defectiveDetect a defective productDoes not correct deficiencies in process or productIssuesWhen to inspectWhere in process to inspectInspection67When and Where to InspectAt the supplier’s plant while the supplier is producingAt your facility upon receipt of goods from the supplierBefore costly or irreversible processesDuring the step-by-step production processesWhen production or service is completeBefore delivery from your facilityAt the point of customer contact68Inspection Points in ServicesOrganizationWhat is InspectedStandardJones Law OfficeReceptionist performanceBillingAttorneyIs phone answered by the second ringAccurate, timely, and correct formatPromptness in returning calls69Inspection Points in ServicesOrganizationWhat is InspectedStandardHard Rock HotelReception deskDoormanRoomMinibarUse customer’s nameGreet guest in less than 30 secondsAll lights working, spotless bathroomRestocked and charges accurately posted to bill70Inspection Points in ServicesOrganizationWhat is InspectedStandardBayfield Community HospitalBillingPharmacyLabNursesAdmissionsAccurate, timely, and correct formatPrescription accuracy, inventory accuracyAudit for lab-test accuracyCharts immediately updatedData entered correctly and completely71Inspection Points in ServicesOrganizationWhat is InspectedStandardHard Rock CafeBusboyBusboyWaiterServes water and bread within 1 minuteClears all entrée items and crumbs prior to desertKnows and suggest specials and desserts72Inspection Points in ServicesOrganizationWhat is InspectedStandardNordstrom’s Department StoreDisplay areasStockroomsSalesclerksAttractive, well-organized, stocked, good lightingRotation of goods, organized, cleanNeat, courteous, very knowledgeable73Inspection Points in ServicesBankTeller stationsLoan accountsChecking accountsShortages, courtesy, speed, accuracyCollateral, proper credit checks, rates, terms of loans, default rates, loan ratesAccuracy, speed of entry, rate of overdrawsOrganizationSome Points of InspectionIssues to Consider74Inspection Points in ServicesRetail storeStockroomsDisplay areasSales countersClean, uncluttered, organized, level of stockouts, amply supply, rotation of goodsAttractive, well-organized, stocked, visible goods, good lightingNeat, courteous knowledgeable personnel; waiting time; accuracy in credit checking and sales entryOrganizationSome Points of InspectionIssues to Consider75Inspection Points in ServicesRestaurantKitchenCashier stationDining areasClean, proper storage, unadulterated food, health regulations observed, well-organizedSpeed, accuracy, appearanceClean, comfortable, regular monitoring by personnel, OrganizationSome Points of InspectionIssues to Consider76Service quality is more difficult to measure than for goodsService quality perceptions depend on Expectations versus realityProcess and outcomeTypes of service qualityNormal: Routine service deliveryExceptional: How problems are handledTQM In Services77Goods versus ServicesCan be resoldCan be inventoriedSome aspects of quality measurableSelling is distinct from productionReselling unusualDifficult to inventoryQuality difficult to measureSelling is part of service Good Service78Goods versus Services - continuedProduct is transportableSite of facility important for costOften easy to automateRevenue generated primarily from tangible productProvider, not product is transportableSite of facility important for customer contactOften difficult to automateRevenue generated primarily from intangible service. Good Service79Under-standingTangiblesReliabilityCommunicationCredibilitySecurityResponsivenessCompetenceCourtesyAccess© 1995 Corel Corp.Service Quality Attributes80Determinants of Service QualityReliability – consistency and dependabilityResponsiveness – willingness/readiness of employees to provide service; timelinessCompetence – possession of skills and knowledge required to perform serviceAccess – approachability and ease of contactCourtesy – politeness, respect, consideration, friendliness of contact personnel81Determinants of Service Quality -ContinuedCommunication – keeping customers informed in languages they understandCredibility – trustworthiness, believability, honestySecurity – freedom from danger, risk or doubtUnderstanding/knowing the customer – making the effort to understands the customer’s needsTangibles – the physical evidence of the service82