2008 Prentice Hall, Inc. 6 – 1 Operations Management Chapter 6 – Chapter 6 – Managing Quality Managing Quality PowerPoint presentation to accompany PowerPoint presentation to accompany Heizer/Render Heizer/Render Principles of Operations Management, 7e Principles of Operations Management, 7e Operations Management, 9e Operations Management, 9e Extensive chages have been made to this slide set by Ömer Yağız.
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PowerPoint presentation to accompany PowerPoint presentation to accompany Heizer/Render Heizer/Render Principles of Operations Management, 7ePrinciples of Operations Management, 7eOperations Management, 9e Operations Management, 9e
Extensive chages have been made to this slide set by Ömer Yağız.
To Make the Quality Focus To Make the Quality Focus WorkWork
MotorolaMotorola::– Aggressively began a worldwide education Aggressively began a worldwide education
program to be sure that employees understood program to be sure that employees understood quality and statistical process controlquality and statistical process control
– Established goalsEstablished goals • ““stretch goal” - a goal which is very ambitiousstretch goal” - a goal which is very ambitious
– Established extensive employee participation Established extensive employee participation and employee teamsand employee teams
– originator of the “six-sigma” approach to qualityoriginator of the “six-sigma” approach to quality
– winner of the Baldrige national quality awardwinner of the Baldrige national quality award
A A stretch goal stretch goal is an ambitious goal. is an ambitious goal. Sometimes it is called a “Sometimes it is called a “breakthrough breakthrough objective.objective.” Stretch goals force an ” Stretch goals force an organization to think radically different to organization to think radically different to encourage major improvements, as well encourage major improvements, as well as incremental ones. Stretch goals can be as incremental ones. Stretch goals can be set for all areas of the company, including set for all areas of the company, including manufacturing, sales, accounting, product manufacturing, sales, accounting, product design, etc.design, etc.
MOTOROLA Co. --A famous MOTOROLA Co. --A famous illustration of stretch goalillustration of stretch goal
““Six Sigma Quality” concept of Motorola:Six Sigma Quality” concept of Motorola:
Motorola set the following stretch goal in Motorola set the following stretch goal in 1987.1987.
““Improve product and services quality ten Improve product and services quality ten times by 1989, and at least one hundred fold by 1991. times by 1989, and at least one hundred fold by 1991. Achieve Achieve six sigma capability six sigma capability by 1992. With a deep by 1992. With a deep sense of urgency, spread dedication to quality to every sense of urgency, spread dedication to quality to every facet of the corporation, and achieve a culture of facet of the corporation, and achieve a culture of continuous improvement to assure total customer continuous improvement to assure total customer satisfaction. There is only one ultimate goal: zero satisfaction. There is only one ultimate goal: zero defects--in everything we do.”defects--in everything we do.”
MOTOROLA Co. --A famous MOTOROLA Co. --A famous illustration of stretch goal illustration of stretch goal
Concept of six-sigma quality:Concept of six-sigma quality:
Shrinking process variation (as indicated Shrinking process variation (as indicated by 6 sigma) to half of the design tolerance by 6 sigma) to half of the design tolerance so that only 3.4 parts out of 1 million are so that only 3.4 parts out of 1 million are defective. defective.
At Motorola, six sigma became part of the At Motorola, six sigma became part of the common language of all employees. To common language of all employees. To them it meant “near perfection”, even if them it meant “near perfection”, even if some did not understand the statistical some did not understand the statistical details.details.
The Flow of ActivitiesThe Flow of Activities to to achieve TQMachieve TQM
Organizational PracticesLeadership, Mission statement, Effective operating procedures, Staff support, TrainingYields: What is important and what is to be
accomplished
Quality PrinciplesCustomer focus, Continuous improvement, Benchmarking, Just-in-time, Tools of TQMYields: How to do what is important and to be
accomplished
Employee FulfillmentEmpowerment, Organizational commitmentYields: Employee attitudes that can accomplish
what is importantCustomer SatisfactionWinning orders, Repeat customersYields: An effective organization with
Different ViewsDifferent Views of Quality of Quality
Manufacturing-based – conformance Manufacturing-based – conformance to standards, making it right the to standards, making it right the first timefirst time quality is “conformance to quality is “conformance to
specifications”. Specifications are specifications”. Specifications are targets and tolerances determined by targets and tolerances determined by designers of products and services. designers of products and services. This is a key definition of quality for the This is a key definition of quality for the technical aspects of quality planning technical aspects of quality planning and control.and control.
Different ViewsDifferent Views of Quality of Quality
• Product-based – specific and Product-based – specific and measurable attributes of the productmeasurable attributes of the product quality is a function of a specific, quality is a function of a specific,
measurable variable and differences in measurable variable and differences in the quality reflect differences in quantity the quality reflect differences in quantity of some product attribute ( number of of some product attribute ( number of knots on carpets, number of cylinders knots on carpets, number of cylinders in an auto engine, percentage of silk in in an auto engine, percentage of silk in a shirt or blouse).a shirt or blouse).
Performance: A product’s primary Performance: A product’s primary operating characteristics. Will the operating characteristics. Will the product do the intended job? (Car product do the intended job? (Car example -- acceleration, braking example -- acceleration, braking distance, steering, maneuverability.)distance, steering, maneuverability.)
Features: Characteristics of secondary Features: Characteristics of secondary importance for the functioning of a importance for the functioning of a product. In other words, “the bells and product. In other words, “the bells and whistles” of a product. ( Power whistles” of a product. ( Power steering, antilock brakes, tape/CD steering, antilock brakes, tape/CD deck, A/C, reclining seats.)deck, A/C, reclining seats.)
Reliability: probability of a product’s Reliability: probability of a product’s surviving over a specified period of time surviving over a specified period of time under stated conditions of use. under stated conditions of use. Consistency of performance over time. Consistency of performance over time. How often does the product fail? (Ability How often does the product fail? (Ability to start on cold days, frequency of to start on cold days, frequency of failure of various components).failure of various components).
Conformance: Degree to which physical Conformance: Degree to which physical and performance characteristics of a and performance characteristics of a product match preestablished product match preestablished standards. Is the product made exactly standards. Is the product made exactly as the designer intended? (fit and finish, as the designer intended? (fit and finish, aerodynamic properties-drag coefficient, aerodynamic properties-drag coefficient, freedom from noise, fuel consumption.)freedom from noise, fuel consumption.)
Durability: Amount of use one gets Durability: Amount of use one gets from a product before it physically from a product before it physically deteriorates or until replacement is deteriorates or until replacement is preferable. How long does the product preferable. How long does the product last ? (Corrosion resistance, wear of last ? (Corrosion resistance, wear of seat cover material, wiper blades seat cover material, wiper blades motor, AC compressor, etc.)motor, AC compressor, etc.)
Serviceability: The speed, courtesy, Serviceability: The speed, courtesy, and competence of maintenance and and competence of maintenance and repair. How easy is it to service and repair. How easy is it to service and repair the product? (Access to spare repair the product? (Access to spare parts, the number of kilometers parts, the number of kilometers between major maintenance service, between major maintenance service, ease and expense of service.)ease and expense of service.)
Aesthetics: How a product looks, Aesthetics: How a product looks, feels, sounds, tastes, or smells. What feels, sounds, tastes, or smells. What does the product look like? (Color, does the product look like? (Color, instrument panel design, placement instrument panel design, placement of controls, and “feel of the road”.)of controls, and “feel of the road”.)
Perceived Quality: Subjective Perceived Quality: Subjective assessment of quality resulting from assessment of quality resulting from image, advertising, or brand names. image, advertising, or brand names. What is the reputation of the company What is the reputation of the company or its product? (Brand image of car, or its product? (Brand image of car, repair history reported by trade repair history reported by trade magazines or friends.)magazines or friends.)
Tüketici tarafından algılanan kaliteTüketici tarafından algılanan kalite
Malcom Baldrige National Malcom Baldrige National Quality AwardQuality Award
Established in 1988 by the U.S. Established in 1988 by the U.S. governmentgovernment
Designed to promote TQM practicesDesigned to promote TQM practices
Recent winnersRecent winners Premier Inc., MESA Products, Sunny Premier Inc., MESA Products, Sunny
Fresh Foods, Park Place Lexus, North Fresh Foods, Park Place Lexus, North Mississippi Medical Center, The Bama Mississippi Medical Center, The Bama Companies, Richland College, Texas Companies, Richland College, Texas Nameplate Company, Inc.Nameplate Company, Inc.
European Foundation for Quality European Foundation for Quality Management (EFQM) (established in Management (EFQM) (established in 1988 by the European Commission)1988 by the European Commission)
Deming Prize (established in 1951 in Deming Prize (established in 1951 in honor of Deming, the quality guru honor of Deming, the quality guru who helped Japan establish its who helped Japan establish its famous quality system)famous quality system)
• KALDER Quality Award (established KALDER Quality Award (established in 1991 by Turkish Quality in 1991 by Turkish Quality Association – Kalite DerneğiAssociation – Kalite Derneği
• Has been very successful in Turkey’s Has been very successful in Turkey’s bid for quality excellencebid for quality excellence
A Japanese character A Japanese character that symbolizes a that symbolizes a broader dimension broader dimension than quality, a deeper than quality, a deeper process than process than education, and a more education, and a more perfect method than perfect method than persistencepersistence
Internal failure - producing defective parts or Internal failure - producing defective parts or service before deliveryservice before delivery ( (scrap, rework, downtime of machinery)
External costs - defects discovered after External costs - defects discovered after deliverydelivery to customer ( to customer (returned product, liabilities, loss of goodwill, warranty repair, costs to society)
Ethics and Quality Ethics and Quality ManagementManagement
Operations managers must deliver Operations managers must deliver healthy, safe, quality products and healthy, safe, quality products and servicesservices
Poor quality risks injuries, lawsuits, Poor quality risks injuries, lawsuits, recalls, and regulationrecalls, and regulation
Organizations are judged by how Organizations are judged by how they respond to problemsthey respond to problems
All stakeholders much be All stakeholders much be consideredconsidered
Represents continual Represents continual improvement of all processes improvement of all processes
Involves all operations and work Involves all operations and work centers including suppliers and centers including suppliers and customerscustomersPeople, Equipment, Materials, People, Equipment, Materials,
Two meaningsTwo meanings Statistical definition of a process that Statistical definition of a process that
is 99.9997% capable, 3.4 defects per is 99.9997% capable, 3.4 defects per million opportunities (DPMO)million opportunities (DPMO)
A program designed to reduce A program designed to reduce defects, lower costs, and improve defects, lower costs, and improve customer satisfactioncustomer satisfaction
Two meaningsTwo meanings Statistical definition of a process that Statistical definition of a process that
is 99.9997% capable, 3.4 defects per is 99.9997% capable, 3.4 defects per million opportunities (DPMO)million opportunities (DPMO)
A program designed to reduce A program designed to reduce defects, lower costs, and improve defects, lower costs, and improve customer satisfactioncustomer satisfaction
Getting employees involved in product Getting employees involved in product and process improvementsand process improvements 85% of quality problems are due 85% of quality problems are due
to process and materialto process and material TechniquesTechniques
Build communication networks Build communication networks that include employeesthat include employees
Develop open, supportive supervisorsDevelop open, supportive supervisors Move responsibility to employeesMove responsibility to employees Build a high-morale organizationBuild a high-morale organization Create formal team structuresCreate formal team structures
Selecting best practices to use as a Selecting best practices to use as a standard for performancestandard for performance
Determine what to Determine what to benchmarkbenchmark
Form a benchmark teamForm a benchmark team Identify benchmarking partnersIdentify benchmarking partners Collect and analyze benchmarking Collect and analyze benchmarking
informationinformation Take action to match or exceed the Take action to match or exceed the
‘‘Pull’ system of production scheduling Pull’ system of production scheduling including supply managementincluding supply management Production only when signaledProduction only when signaled
Allows reduced inventory levelsAllows reduced inventory levels Inventory costs money and hides process Inventory costs money and hides process
and material problemsand material problems
Encourages improved process and Encourages improved process and product qualityproduct quality
Engineering and experimental Engineering and experimental design methods to improve product design methods to improve product and process designand process design Identify key component and process Identify key component and process
Ability to produce products Ability to produce products uniformly in adverse manufacturing uniformly in adverse manufacturing and environmental conditionsand environmental conditions Remove the effects of adverse Remove the effects of adverse
conditionsconditions
Small variations in materials and Small variations in materials and process do not destroy product process do not destroy product qualityquality
Quality Loss FunctionQuality Loss Function Shows that costs increase as the Shows that costs increase as the
product moves away from what product moves away from what the customer wantsthe customer wants
Costs include customer Costs include customer dissatisfaction, warranty dissatisfaction, warranty and service, internal and service, internal scrap and repair, and costs to scrap and repair, and costs to societysociety
Traditional conformance Traditional conformance specifications are too simplisticspecifications are too simplistic
(b)(b) Scatter Diagram: A graph of the value Scatter Diagram: A graph of the value of one variable vs. another variableof one variable vs. another variable
(c)(c) Cause-and-Effect Diagram: A tool that Cause-and-Effect Diagram: A tool that identifies process elements (causes) that identifies process elements (causes) that might effect an outcomemight effect an outcome
(d)(d) Pareto Chart: A graph to identify and plot Pareto Chart: A graph to identify and plot problems or defects in descending order of problems or defects in descending order of frequencyfrequency
(e)(e) Flowchart (Process Diagram): A chart that Flowchart (Process Diagram): A chart that describes the steps in a processdescribes the steps in a process
(f)(f) Histogram: A distribution showing the Histogram: A distribution showing the frequency of occurrences of a variablefrequency of occurrences of a variable
(g)(g) Statistical Process Control Chart: A chart with Statistical Process Control Chart: A chart with time on the horizontal axis to plot values of a time on the horizontal axis to plot values of a statisticstatistic
MRI FlowchartMRI Flowchart1.1. Physician schedules MRIPhysician schedules MRI2.2. Patient taken to MRIPatient taken to MRI3.3. Patient signs inPatient signs in4.4. Patient is preppedPatient is prepped5.5. Technician carries out MRITechnician carries out MRI6.6. Technician inspects filmTechnician inspects film
7.7. If unsatisfactory, repeatIf unsatisfactory, repeat8.8. Patient taken back to roomPatient taken back to room9.9. MRI read by radiologistMRI read by radiologist10.10. MRI report transferred to MRI report transferred to
physicianphysician11.11. Patient and physician discussPatient and physician discuss