Introduction to Operations Management

Introduction to QUALITY MANAGEMENT

Introduction to Operations Management

Quality Management What does the term quality mean?

Quality is the ability of a product or service to consistently meet or exceed customer expectations.

A brief introduction. More details will be discuss in the course ISMT 263: Introduction to Quality Management

Introduction to Operations Management

Dimensions of Quality

How do people evaluate quality?Performance - main characteristics of the

product/serviceSpecial features - extra characteristicsConformance - how well product/service

conforms to customer expectationsReliability - consistency of performance

Introduction to Operations Management

Dimensions of Quality (Cont)

Durability - useful life of the product/service

Perceived Quality - indirect evaluation of quality (e.g. reputation)

Service after sale - handling of customer complaints or checking on customer satisfaction

Introduction to Operations Management

Determinants of Quality

What factors determine the quality of a product or service?

Introduction to Operations Management

Determinants of Quality

Service

Design Ease ofuse

Conform-ance to design

Introduction to Operations Management

Examples of Quality DimensionsD i m e n s i o n

1 . P e r f o r m a n c e

2 . S p e c i a l f e a t u r e s : S a f e t y A e s t h e t i c s C o n v e n i e n c e H i g h t e c h

( P r o d u c t )A u t o m o b i l e

E v e r y t h i n g w o r k s , f i t &f i n i s hR i d e , h a n d l i n g , g r a d e o fm a t e r i a l s u s e d

A n t i l o c k b r a k e s , a i r b a g sI n t e r i o r d e s i g n , s o f t t o u c hG a u g e / c o n t r o l p l a c e m e n tC e l l u l a r p h o n e , C D p l a y e r

( S e r v i c e )A u t o R e p a i r

A l l w o r k d o n e , a t a g r e e dp r i c eF r i e n d l i n e s s , c o u r t e s y ,C o m p e t e n c y , q u i c k n e s s

S e p a r a t e w a i t i n g a r e aC l e a n w o r k / w a i t i n g a r e aL o c a t i o n , c a l l w h e n r e a d yC o m p u t e r d i a g n o s t i c s

Introduction to Operations Management

Examples of Quality Dimensions (Cont’d)

Dimension

3. Reliability

4. Durability

5. Perceived quality

6. Service after sale

(Product)AutomobileInfrequency of breakdowns

Useful life in miles, resistanceto rust & corrosion

Top-rated car

Handling of complaints and/orrequests for information

(Service)Auto Repair

Work done correctly,ready when promised

Work holds up overtime

Award-winning servicedepartment

Handling of complaints

Introduction to Operations Management

The Consequences of Poor Quality

Loss of businessLiabilityProductivity (rework, defective output

that must be scrapped)Costs (rework, scrap, warranty cost,

etc.)

Introduction to Operations Management

Costs of QualityFailure Costs - costs incurred by defective

parts/products or faulty services.Internal Failure Costs

Costs incurred to fix problems that are detected before the product/service is delivered to the customer.

External Failure Costs All costs incurred to fix problems that are detected

after the product/service is delivered to the customer.

Introduction to Operations Management

Costs of Quality (continued)

Appraisal Costs All product and/or service inspection costs.

Prevention Costs All TQ training, TQ planning, customer

assessment, process control, and quality improvement costs to prevent defects from occurring

Introduction to Operations Management

Key Contributors to Quality Management

C o n t r i b u t o r

D e m i n g

J u r a n

C r o s b y

I s h i k a w a

K n o w n f o r

1 4 p o i n t s ; s p e c i a l & c o m m o n c a u s e s o fv a r i a t i o n

Q u a l i t y i s f i t n e s s f o r u s e ; q u a l i t y t r i l o g y

Q u a l i t y i s f r e e ; z e r o d e f e c t s

C a u s e - a n d e f f e c t d i a g r a m s ; q u a l i t yc i r c l e s

Q u a l i t y

Introduction to Operations Management

Total Quality Management

A philosophy that involves everyone in an organization in the quest for quality, with customer satisfaction as the driving force.

Introduction to Operations Management

Elements of TQM

Continual Improvement

Competitive Benchmarking

Employee Empowerment

Team Approach

Knowledge of Tools

Introduction to Operations Management

The process of involving customers in the design stage of new or redesigned products.

Quality Function Deployment(ouse of Quality?

Definition

Voice of theCustomer

ProductDevelopment

Production Sales

Introduction to Operations Management

Quality Awards

Baldrige Award

Deming Prize

Introduction to Operations Management

Malcolm Baldrige National Quality Award1.0 Leadership (100 points)

2.0 Information and Analysis (70 points)

3.0 Strategic Quality Planning (60 points)

4.0 Human Resource Utilization (150 points)

5.0 Quality Assurance of Products and Services (140 Points)

6.0 Quality Results (180 points)

7.0 Customer Satisfaction (300 points)

Introduction to Operations Management

The Deming Prize

Honoring W. Edwards DemingJapan highly coveted awardMain focus on statistical quality control

Introduction to Operations Management

The ISO 9000 Series Standards

Goal is a set of Euronorms

ISO 9000 series standards, briefly, require firms to document their quality-control systems at every step (incoming raw materials, product design, in-process monitoring and so forth) so that they will be able to identify those areas that are causing quality problems and correct them.

Introduction to Operations Management

The ISO 9000 Series Standards

ISO 9000 requires companies to document everything they do that affects the quality of goods and services. Hierarchical approach to documentation

Introduction to Operations Management

The ISO 9000 Series StandardsISO 9001, 9002, and 9003

This series is used in contractual situations. 9001 is the most stringent - addresses

design/development, production, installation, and service

9002 deals only with production and installation

9003 deals only with final testing and inspection

Introduction to Operations Management

ISO 9000 Series (continued)

ISO 9004 Internal standard that lists essential elements of

a quality system including management responsibilities, marketing, procurement, corrective action, human resource management, product safety, and the use of statistical methods.

Designed to help companies identify improvement opportunities

Introduction to Operations Management

ISO 9000 Registration Process

When an organization feels that its quality system is good enough, it may ask an accredited registrar or other third party audit team for pre-assessment.

Introduction to Operations Management

ISO 9000 Registration Process

The final audit begins with a review of the company's quality manual, which the accredited registrar or third party audit team typically uses as its guide. The audit team checks to see that the documented quality system meets the requirement of ISO 9000 and that the organization is practicing what is documented.

Introduction to Operations Management

ISO 9000 Registration Process

When the registrar is satisfied with the favorable recommendation of the audit team, it grants registration and issues a registration document to the company.