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Copyright 2005 Prentice- Hall, Inc. 15-1
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15-2
ChapteChapte
rr 1515
Managing For Managing For Productivity & QualityProductivity & Quality
Copyright 2005 Prentice- Hall, Inc. 15-3
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ess Chapter OutlineChapter Outline
Productivity-Quality Productivity-Quality ConnectionConnection
Quality ImprovementQuality ImprovementTools For Quality Tools For Quality
ManagementManagementProductivity & Quality As Productivity & Quality As
Competitive ToolsCompetitive Tools
Copyright 2005 Prentice- Hall, Inc. 15-4
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Productivity-QualityProductivity-QualityConnectionConnection
• Productivity- How Much A Productivity- How Much A System Produces With System Produces With Its ResourcesIts Resources
• Quality- Product’s Success Quality- Product’s Success In Offering Features In Offering Features Consumers WantConsumers Want
Copyright 2005 Prentice- Hall, Inc. 15-5
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ess Measuring ProductivityMeasuring Productivity
Labor Labor ProductivityProductivity
Gross Domestic Gross Domestic ProductProduct
Total Number of Total Number of WorkersWorkers
Copyright 2005 Prentice- Hall, Inc. 15-6
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ess International Productivity International Productivity
• International SurvivalInternational Survival
• Global CompetitorsGlobal Competitors
• Example – Food ProductionExample – Food Production– US Worker = $100US Worker = $100– Japanese = $ 68Japanese = $ 68– Belgium = $107Belgium = $107
Copyright 2005 Prentice- Hall, Inc. 15-7
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ess International ProductivityInternational Productivity
Copyright 2005 Prentice- Hall, Inc. 15-8
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ess Domestic ProductivityDomestic Productivity
• Productivity Productivity = Wealth = Wealth
• National National ProductivityProductivity
• Uneven Growth Uneven Growth Manufacturing vs. ServiceManufacturing vs. Service
Copyright 2005 Prentice- Hall, Inc. 15-9
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Selected U.S.Selected U.S.Industries ProductivityIndustries Productivity
Copyright 2005 Prentice- Hall, Inc. 15-10
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U.S. Manufacturing U.S. Manufacturing Productivity IndexProductivity Index
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
1988 1990 1992 1994 1996 1998 2000 2002
% Change In Productivity % Change In Productivity Over Previous YearOver Previous Year
Source: U.S. Department of Labor- Bureau of Labor Statistics
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Productivity Computer/Electronic Productivity Computer/Electronic ManufacturingManufacturing
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
1987 1989 1991 1992 1995 1997 1999 2001
Source: U.S. Department of Labor- Bureau of Labor Statistics
1997 = 100%1997 = 100%
Copyright 2005 Prentice- Hall, Inc. 15-12
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Productivity Of Selected Productivity Of Selected U.S. IndustriesU.S. Industries
Copyright 2005 Prentice- Hall, Inc. 15-13
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ess Managing QualityManaging Quality
• Total Quality ManagementTotal Quality Management• PlanningPlanning
– PerformancePerformance– ReliabilityReliability
• OrganizingOrganizing• Directing – OwnershipDirecting – Ownership• ControllingControlling
Copyright 2005 Prentice- Hall, Inc. 15-14
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Dimensions OfDimensions OfMedical Care QualityMedical Care Quality
1)1) Technical Technical PerformancePerformance
2)2) Access To Access To ServicesServices
3)3) Effectiveness Effectiveness Of CareOf Care
4)4) Interpersonal Interpersonal RelationsRelations
5)5) Interpersonal Interpersonal RelationsRelations
6)6) Continuity Of Continuity Of ServicesServices
7)7) SafetySafety8)8) Physical Physical
Infrastructure Infrastructure & Comfort& Comfort
9)9) ChoiceChoice
Source: Healthcare And Workforce Improvement, Quality Assurance Project
Copyright 2005 Prentice- Hall, Inc. 15-15
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ess Tools For TQMTools For TQM
• Competitive Product AnalysisCompetitive Product Analysis
• Value-Added AnalysisValue-Added Analysis
• Statistical Process Statistical Process ControlControl– Process VariationsProcess Variations– Control ChartsControl Charts
Copyright 2005 Prentice- Hall, Inc. 15-16
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ess Value-Added AnalysisValue-Added Analysis
Non Value Value Added Could be eliminated if
some prior activity done differently
Is the activity required by the end customer?
Can be automated Would the end customer pay for the activity?
Can be eliminated without affecting the output or end product
Copyright 2005 Prentice- Hall, Inc. 15-17
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ess Process Variation StudyProcess Variation Study
Copyright 2005 Prentice- Hall, Inc. 15-18
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ess Process Control ChartProcess Control Chart
Copyright 2005 Prentice- Hall, Inc. 15-19
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ess Quality/Cost StudiesQuality/Cost Studies
• FailuresFailures– InternalInternal– ExternalExternal
• Quality Improvement TeamsQuality Improvement Teams• BenchmarkingBenchmarking
– InternalInternal– ExternalExternal
• Closer To CustomerCloser To Customer
Copyright 2005 Prentice- Hall, Inc. 15-20
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ess Quality StandardsQuality Standards
• Quality Management Quality Management
RequirementsRequirements
• ISO 9000ISO 9000
• ISO 9000:2000ISO 9000:2000
• ISO 14000 – Environmental ISO 14000 – Environmental
PerformancePerformance
ISO 9000ISO 9000
STANDARDSTANDARDSS
Copyright 2005 Prentice- Hall, Inc. 15-21
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ess Process ReengineeringProcess Reengineering
• Business ProcessBusiness Process
• Reengineering ProcessReengineering Process1)1) IdentifyIdentify
2)2) EvaluateEvaluate
3)3) DiagnoseDiagnose
4)4) CreateCreate
5)5) ImplementImplement
Copyright 2005 Prentice- Hall, Inc. 15-22
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ess Reengineering StepsReengineering Steps
Copyright 2005 Prentice- Hall, Inc. 15-23
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ess Supply Chain ValueSupply Chain Value
• Supply (Value) ChainSupply (Value) Chain
• StrategyStrategy
• ManagementManagement
• ReengineeringReengineering
Copyright 2005 Prentice- Hall, Inc. 15-24
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ess Supply ChainSupply Chain
Copyright 2005 Prentice- Hall, Inc. 15-25
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ess Production & QualityProduction & Quality
• Innovation/Technology Innovation/Technology
• Long-Run PerspectiveLong-Run Perspective– Continuous ImprovementContinuous Improvement
– 66σσ (Six Sigma) (Six Sigma)
Copyright 2005 Prentice- Hall, Inc. 15-26
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ess Emphasizing QualityEmphasizing Quality
• Employee EmpowermentEmployee Empowerment
• Employee TrainingEmployee Training
Copyright 2005 Prentice- Hall, Inc. 15-27
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ImprovingImprovingService SectorService Sector
• ReliabilityReliability
• ResponsivenessResponsiveness
• AssuranceAssurance
• EmpathyEmpathy
• TangiblesTangibles
