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8/18/2019 Ch7(Quality Management)
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©The McGraw-Hill Companies,
8/18/2019 Ch7(Quality Management)
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©The McGraw-Hill Companies,
Chapter 7
Quality Management
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©The McGraw-Hill Companies,
• Total Quality Management Defined
• Quality Specifications and Costs
• Six Sigma Quality and Tools
• External Benchmarking
• ISO !!!• Ser"ice Quality Measurement
OB#ECTI$ES
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©The McGraw-Hill Companies,
Total Quality Management %TQM&
Defined
• Total 'uality management is defined as
managing the entire organi(ation so that itexcels on all dimensions of products and
ser"ices that are important to the customer
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Quality Specifications
• Design 'uality) Inherent "alue of the product inthe marketplace
– Dimensions include) *erformance+ ,eatures+-elia.ility+ Dura.ility+ Ser"icea.ility+ -esponse+/esthetics+ and -eputation0
• Conformance 'uality) Degree to 1hich theproduct or ser"ice design specifications are met
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Costs of Quality
External Failure
Costs
Appraisal Costs
Prevention Costs
Internal Failure
Costs
Costs of
Quality
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Six Sigma Quality
• / philosophy and set of methods companies use
to eliminate defects in their products and
processes• Seeks to reduce "ariation in the processes that
lead to product defects
• The name+ 2six sigma3 refers to the "ariation
that exists 1ithin plus or minus three standard
de"iations of the process outputs
σ 3±
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Six Sigma Quality %Continued&
• Six Sigma allo1s managers to readily
descri.e process performance using acommon metric) Defects *er Million
Opportunities %D*MO&
1,000,000x
unitsof No. xunit
pererrorfor iesopportunit
of Number
efe!tsof Number
= DPMO 1,000,000x
unitsof No. xunit
pererrorforiesopportunit of Number
efe!tsof Number
= DPMO
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Six Sigma Quality %Continued&
Example of Defects *er Million
Opportunities %D*MO& calculation0Suppose 1e o.ser"e 4!! lettersdeli"ered incorrectly to the 1rongaddresses in a small city during a singleday 1hen a total of 4!!+!!! letters 1ere
deli"ered0 5hat is the D*MO in thissituation6
Example of Defects *er Million
Opportunities %D*MO& calculation0Suppose 1e o.ser"e 4!! lettersdeli"ered incorrectly to the 1rongaddresses in a small city during a singleday 1hen a total of 4!!+!!! letters 1ere
deli"ered0 5hat is the D*MO in thissituation6
[ ]000,1
==1,000,000x
200,000 x1
200 DPMO
[ ]
000,1== 1,000,000x
200,000 x1
200 DPMO
So, for every onemillion lettersdelivered thiscity’s postalmanagers canexpect to have,!!! letters
incorrectly sentto the "rongaddress#
So, for every onemillion letters
delivered thiscity’s postalmanagers canexpect to have,!!! lettersincorrectly sentto the "rongaddress#
Cost of Quality$ %hat might that &P'( mean in termsof over)time employment to correct the errors*
Cost of Quality$ %hat might that &P'( mean in termsof over)time employment to correct the errors*
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©The McGraw-Hill Companies,
Six Sigma Quality) DM/IC Cycle
• Define+ Measure+ /naly(e+ Impro"e+ andControl %DM/IC&
• De"eloped .y 7eneral Electric as a means of
focusing effort on 'uality using amethodological approach
• O"erall focus of the methodology is to
understand and achie"e 1hat the customer1ants
• DM/IC consists of fi"e steps80
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Six Sigma Quality) DM/IC Cycle
%Continued&
90 Define %D&
40 Measure %M&
:0 /naly(e %/&
;0 Impro"e %I&
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/nalytical Tools for Six Sigma and
Continuous Impro"ement) ,lo1 Chart +o,Continue…
'aterialeceived
from
Supplier
Inspect
'aterial for
&efects&efects
found*
eturn to
Supplier
for Credit
-es
Can .e used to
find /uality
pro.lems
Can .e used to
find /uality
pro.lems
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/nalytical Tools for Six Sigma and
Continuous Impro"ement) -un Chart
Can .e used to identify
"hen e/uipment or
processes are not
.ehaving according to
specifications
Can .e used to identify
"hen e/uipment or
processes are not
.ehaving according to
specifications
0.44
0.460.48
0.5
0.52
0.54
0.56
0.58
1 2 3 4 5 6 7 8 9 10 11 12
Time (Hours)
D i a m e t e r
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©The McGraw-Hill Companies,
/nalytical Tools for Six Sigma and
Continuous Impro"ement) *areto
/nalysisCan .e used
to find "hen
0!1 of the
pro.lemsmay .e
attri.uted to
2!1 of the
causes
Can .e used
to find "hen
0!1 of the
pro.lemsmay .e
attri.uted to
2!1 of the
causes
Ass.
!nstru"t.
# r e $ u e n "
Desi%n &ur"'. Trainin% t'er
80
1
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©The McGraw-Hill Companies,
/nalytical Tools for Six Sigma and
Continuous Impro"ement) Checksheet
3illing Errors
%rong Account
%rong Amount
A4 Errors
%rong Account
%rong Amount
'onday
Can .e used to 5eep trac5 of
defects or used to ma5e sure
people collect data in a
correct manner
Can .e used to 5eep trac5 of
defects or used to ma5e sure
people collect data in a
correct manner
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/nalytical Tools for Six Sigma and
Continuous Impro"ement) =istogram
+ u m . e
r o f 6 o t s
&ata anges
&efects
in lot
0 1 2 3 4
Can .e used to identify the fre/uency of /uality
defect occurrence and display /uality
performance
Can .e used to identify the fre/uency of /uality
defect occurrence and display /uality
performance
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/nalytical Tools for Six Sigma and
Continuous Impro"ement) Cause >
Effect Diagram
*++e"t
ana"'ine
ateria-et'o
*n/ironment
Possi.le causes$Possi.le causes$ 7he results
or effect
7he results
or effect
Can .e used to systematically trac5 .ac5"ards to
find a possi.le cause of a /uality pro.lem 8or
effect9
Can .e used to systematically trac5 .ac5"ards to
find a possi.le cause of a /uality pro.lem 8or
effect9
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/nalytical Tools for Six Sigma and
Continuous Impro"ement) Control Charts
Can .e used to monitor ongoing production process
/uality and /uality conformance to stated standards of
/uality
Can .e used to monitor ongoing production process
/uality and /uality conformance to stated standards of
/uality
970
980
990
1000
1010
1020
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
6C6
:C6
1"
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Other Six Sigma Tools• Opportunity ,lo1 Diagram used to graphically
sho1 those acti"ities that add "alue from thosethat are performed %and may.e could .e reducedor remo"ed& that do not add "alue to the finishedproduct
• ,ailure Mode and Effect /nalysis %DME/& is astructured approach to identify+ estimate+prioriti(e+ and e"aluate risk of possi.le failures
at each stage in the process• Design of Experiments %DOE& a statistical test to
determine cause?and?effect relationships.et1een process "aria.les and output
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Six Sigma -oles and -esponsi.ilities
90 Executi"e leaders must champion the
process of impro"ement
40 Corporation?1ide training in Six Sigma
concepts and tools
:0 Setting stretch o.@ecti"es for impro"ement
;0 Continuous reinforcement and re1ards
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The Shingo System) ,ail?Safe Design
• ShingoAs argument) – SQC methods do not pre"ent defects
–
Defects arise 1hen people make errors – Defects can .e pre"ented .y pro"iding 1orkers 1ith
feed.ack on errors
• *oka?oke includes) – Checklists
– Special tooling that pre"ents 1orkers from makingerrors
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©The McGraw-Hill Companies,
ISO !!!
• Series of standards agreed upon .y theInternational Organi(ation forStandardi(ation %ISO&
• /dopted in 9
• More than 9!! countries
• / prere'uisite for glo.al competition6
• ISO !!! directs you to document 1hat youdo and then do as you documented
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Three ,orms of ISO Certification
90 ,irst party) / firm audits itself against ISO
!!! standards
40 Second party) / customer audits its supplier
:0 Third party) / 'ualified national or
international standards or certifying agency
ser"es as auditor
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©The McGraw-Hill Companies,
External Benchmarking Steps
90 Identify those processes needing impro"ement
40 Identify a firm that is the 1orld leader in
performing the process
:0 Contact the managers of that company and
make a personal "isit to inter"ie1 managers
and 1orkers
;0 /naly(e data
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©The McGraw-Hill Companies,
Ser"ice Quality Measurement)Ser"'ual
• / percei"ed ser"ice 'uality 'uestionnairesur"ey methodology
• Examines 2Dimensions of Ser"ice Quality3including) -elia.ility+ -esponsi"eness+
/ssurance+ Empathy+ and Tangi.les %e0g0+
appearance of physical facilities+e'uipment+ etc0&
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Ser"ice Quality Measurement) Ser"'ual
%Continued&
• Fe1 "ersion of this methodology is called2e?Ser"ice Quality3 dealing ser"ice on
the Internet
• Dimensions of Ser"ice Quality on the e?Ser"ice methodology include) -elia.ility+
-esponsi"eness+ /ccess+ ,lexi.ility+ Ease
of Fa"igation+ Efficiency+/ssuranceGTrust+ SecurityG*ri"acy+ *rice
Hno1ledge+ Site /esthetics+ and
Customi(ationG*ersonali(ation
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#n of Chapter 7