“Perfection is the goal, but excellence will be tolerated.
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Quality management
Session 4
UNIT I
Tools and Techniques:Design Tools – Quality Planning Tools –
Continuous Improvement Tools - 5S and Kaizen– Lean Concept
Six Sigma: Concepts – Steps and Tools – De ne, Measure, Analyse,
Improve and Control (DMAIC) Methodology of Six Sigma
Implementation – De ne, Measure, Analyse, Design and Verify
(DMADV) Methodology for High Performance Designs
– TQM vs. Six Sigma – Lean Six Sigma – Assessing Readiness for Six
Sigma
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Relation
betwee
Goals and Means
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There is a remarkable similarity between Buddhism and Continuous
Improvement(CI) programme
CI is evolved in a culture which is nourished by Buddhism
The continuous improvement of waste elimination is the core of lean
approach
The targets are ambitious because the real objective is the continuous
search
for perfection, as indicated in Buddhist philosophy, which is the core of
Japanese culture.
In fact the Buddhist goal is the achievement of human perfection, which
should be the real purpose of life. It is in this sense that life has meaning,
and which should inform the most salient aspects of human activity
that aims at a perfection of personhood.
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De n
Measur
Analys
Improv
Control
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The balanced scorecard, developed ( Robert Kaplan and David
Norton),examines a firm’s performance in four critical areas
1. Finances—How should we look to our shareholders
2. Customers—How should we look to our customers
3. Processes—At which business processes must we excel
4. Learning and Growing—How will we sustain our ability to change
and improve?
Value
= Befni ts /cost
Perception of the bene ts associated with a good, service, or bundle of goods and
services in relation to what a buyer pay
Goods or services are perceived favourably by customers if the ratio of perceived
bene ts to price to the customer is hig
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Input-Output Framework Of A Value Chain
Transactions between Buyers and Sellers,
Type
• Good: Physical product that a person sees, touches, or
consumes
• Durable good: Product that does not quickly wear out
and lasts at least three years
• Non-durable good: Product that perishes and lasts for
less than three years
• Service: Primary or complementary activity that does
not directly produce a physical product
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Goods versus Services,
Goods versus Services,
Product Quality Dimension
Performance
Ef ciency with which a product achieves its intended purpose
Features
Attributes of a product that supplement the product’s basic
performanc
Reliability
The propensity for a product to perform consistently over its
useful design life
Conformance
Meeting Speci cations like capacity, speed, size, durability, or
the like. They have tolerance of the speci cation.
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Product Quality Dimension
Durability
Degree to which a product tolerates stress or trauma without
failing
Serviceability
Is the ease of repair for a product
Aesthetics
Sensory characteristics such as taste, feel, sound, look, and smell.
aesthetically pleasing.
Perceived qualit
is based on customer opinion.
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ISO 9000:2000 Standards
De ne quality system standards, based on the premise that
management practices can be standardizedHelp outputs
meet customer expectations and requirements
Internationally recognised
Prescribe documentation for all processes affecting quality
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Quality Management
Systematic policies, methods, and procedures Used to ensure
that goods and services are produced with appropriate levels
of quality to meet the needs of customers
Deals with issues relating to how goods and services are
designed, created, and delivered to meet customer
expectations
Quality of conformance: Extent to which a process is able to
deliver outputs that conform to the design
Speci cations: Targets and tolerances determined by
designers of goods and services
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Three spheres of quality
Quality control, Quality assurance, and Quality management
Quality control
• Monitoring process capability and stabilit
• Measuring process performanc
• Reducing process variabilit
• Optimising processes to nominal measure
• Performing acceptance samplin
• Developing and maintaining control charts
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Acceptance sampling
This is not 100% inspection
one of the earliest aspects of quality control, even before statistical methodology
was developed for quality improvement.
Inspection can occur at many points in any process.
Acceptance sampling, de ned as the inspection and classi cation of a sample of units
selected at random from a larger batch or lot and the ultimate decision about
disposition of the lot, usually occurs at two points:
incoming raw materials or components, or nal productio
Total lot produced or supplied ,Population 2000 item
Sample selected at random 4
Acceptance number 2
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Population 2000 item
Sample selected at random 4
Acceptance number
Suppose population contains only 1% mistakes
1980 good 20 bad
But if sample contains 3 mistakes , a good population is
rejected
This is called producers risk .
Type 1 error
Population 2000 item
Sample selected at random 4
Acceptance number
Suppose population contains 10% mistakes
1800 good 200 bad
But if sample contains only 2 mistakes , a bad population is
accepted
This is called consumers risk .
Type 2 error
GOOD LOT BAD LOT
REJECT
TYPE 1 ERROR
ACCEPT
TYPE 2 ERROR
Quality assurance
Guaranteeing the quality of a product or service.
Design-related.
Selection of best process, material, &inspection , will help to assure Qualit
The best way to ensure quality is in the design of products, services, and processes.
Quality assurance activities include tasks such a
» Failure mode and effects analysi
» Concurrent engineerin
» Experimental desig
» Process improvemen
» Design team formation and managemen
» Off-line experimentatio
» Reliability/durability product testing
Quality management
The management processes that overarch and tie together the control
and assurance activities make up quality management
Quality is the responsibility of all management, not just quality managers.
For this reason, a number of managers, supervisors, and employees are
involved in quality management activities such a
• Planning for quality improvemen
• Creating a quality organisational cultur
• Providing leadership and suppor
• Providing training and retrainin
• Designing an organisational system that reinforces quality ideal
• Providing employee recognitio
• Facilitating organisational communicatio
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Elements of Lean
Lean is composed of three elements that work in unison
Lean Productio
Total Quality Management (TQM
Respect for People
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Principles of Lean Operating Systems
Elimination of waste
• Activities that do not add value and support
processes in an organization are eliminated
Increased speed and response
• Transfer of all physical materials and
information in a value chain is coordinated
to achieve a high level of efficiency
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WASTES TO AVOID
1. Transportation
2 Inventory
Produce only what’s needed & when your customer needs it
3 Unnecessary Motio
4. Waitin
5. Over Processing
Ergonomic Storage Design
6. Over Production
7 Defect
8 Unutilised Skill
TIMWOODS
DEFINITION OF WASTE
Essentially, "waste" is anything that the customer is not willing to pay for.
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TIMWOOD
A key component of the Lean philosophy is a never-ending effort to
eliminate waste,
which is defined as “any activity that does not add value to the good
or service in the eyes of the consumer.
1. Unnecessary transportation. Transporting goods always increases
costs and the risk of damage, but it does not necessarily provide value to the final
customer.
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TIMWOOD
2. Unnecessary inventory.
Uncertainty with regard to quality levels, delivery lead times, and the like can
lead to unnecessary inventory
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Organisatio
Non-Business organisatio
Business organisation (Firm
Goods(Products )& Service
Good
Inventor
Cost of inventory
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Pro t= Revenue-Expenditur
= Income- cost
Income = Selling price x Quantity sol
Costs = Fixed costs+ Variable costs
Variable costs = Labour costs +Material cost
Material costs is inventory cos
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Pro t= Revenue-Expenditur
= Income- cost
Cost + Pro t = Selling Price
Selling Price- Cost= pro t
Selling Price- Pro t= cost
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TIMWOOD
3. Unnecessary/excess motion. Poorly designed processes can lead to
unnecessary motion. Ergonomic design /layout
4. Waiting. In efficient layouts or an inability to match demand with
output levels may cause waiting
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TIMWOOD
5. Overproduction.
In flexible or unreliable processes may cause organisations to produce goods before
they are required
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Production systems
1 Job Productio
2 Batch Productio
3 Mass Productio
4 Continuous Productio
5 Projects
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Job production
• Low volume
• High Variety,
• As per customer order
• High skill required
• Cost/unit is high
• Discrete production
Batch Productio
• Production Rate > Demand Rate
• Similar products in batches
• Set up time required
• Number of batches more, batch size is smal
• Number of Batches less, Batch size is Big
• Continuous production
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Machine can produce 500units /Mont
6000units/Yea
Demand for products
A 1500/Year
B 1500/Yea
C 1500/Yea
D 1500/ Year
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12 Batches Month J F M A M J J A S O N D
Product A B C D A B C D A B C D
Batch size
500 500 500 500 500 500 500 500 500 500 500 500
JANUAR APRIL JULY OCTOBE
Month FEBRAUAR MA AUGUS NOVEMBE
MARCH JUNE SEPTEMBER DECEMBER
4 Batches
Product A B C D
Batch size 1500 1500 1500 1500
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Small Batch Schedulin
Small Lot Size Approach
500A500B500C500D / 500A500B 500C 500D /500A500B500C500 D
12 Product Changes, Batch Size 500 Total 1500A 1500B 1500 C 1500D
Large Lot Size Approach
1500A 1500B 1500C 1500
4 Product Changes, Batch Size 1500 Total 1500A 1500B 1500 C 1500D
D
Small Lot Production
The amount of products produced at any one time is smal
• Reduces inventory and excess processing
• Increases exibility
• Shortens manufacturing lead time
• Responds to customer demands more quickly
• Setup time must be low
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Small Batch Schedulin
Small batch scheduling drives down costs by
Reducing purchased inventory , WIP, & Finished goods inventories
Makes the rm more exible to meet customer demand
Small production batches are accomplished with the use of kanban
Kanbans generate demand for parts at all stages of production
creating a “pull” system
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Short Setup Times
Setup: the set of activities needed to change or readjust a process between successive
batches of product
Japanese are seeking to minimise the batch quantity by shifting the curve that represents
the cost of ordering or the cost of set-ups to the lef
Focus on nding ways to reduce set-up costs and ordering costs.
Single-Minute Exchange of Dies (SMED
This approach allowed automobile manufacturers to reduce the setup time for changing
dies from several hours to just a few minutes.
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Mass Production
• Economics of scale
• Large batch size
• Skill required is less
• Cost /unit less
• Continuous production
Continuous production
Projects
TIMWOOD
6 Inappropriate/over processing .
Firms sometimes use overly complex processes when simpler, more efficient ones
would do
7. Defects. Not only do defects create uncertainty in the process, they rob production
capacity by creating products or services that require rework or must be scrapped
8. Underutilisation of employees. This is the newest form of waste added to the list,
and it recognises that too often companies do not fully utilize the skills and decision-
making capabilities of their employees.
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Q1 It is the responsibility of the marketing and sales department
to learn about the products and product features that
consumers want, and the prices they are willing to pay for those
products.
a. True
b. Fals
Ans True
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Q 2 According to Crosby, quality is judged solely on whether requirements have
been met, and nonconformance is the absence of quality.
a. True
b. False
Ans: True
Q3 According to point one of Deming’s 14 points for quality
improvement, the responsibility of improving a rm’s competitive
position lies with ______.
a. Top management
b. Suppliers
c. Middle management
d. Employees
Ans : Top management
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Q4 In Juran’s quality trilogy, the process of preparing to meet quality goals is
called:
a. Quality planning.
b. Quality control.
c. Quality improvement.
d. Quality leadership.
Ans : Quality planning.
Q5 Which of the following terms best represents a rm’s ability to achieve
market superiority?
a. Flexibility
b. Competitive advantage
c. Quality assurance
d. Agilit
Ans Competitive advantage
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Q6 The Six Sigma approach for quality improvement requires increased
levels of training and education for managers, and not for front-line
employees.
a. True
b. Fals
Ans. False
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Q7 Customers generally view quality from the _____ perspective.
a. user
b. manufacturing
c. value
d. transcenden
Ans transcendent
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Q8 The value perspective of quality is most important at the _____ stage in
the creation and delivery of goods and services.
a. manufacturing
b. design
c. marketing
d. distributio
Ans Design
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The rst point in Deming’s 14 points for improving quality is
“Create a vision and demonstrate commitment.”
Explain this point
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First point in Deming’s 14 points for improving quality.
An organisation must de ne its values, mission, and vision of the future to provide long-
term direction for its management and employees.
Deming believed that businesses should not exist simply for pro t; they are social
entities whose basic purpose is to serve their customers and employees.
To ful ll this purpose, they must take a long-term view, invest in innovation, education,
and training, and take responsibility for providing jobs and improving a rm’s competitive
position.
This responsibility lies with top management.
Effective leadership begins with commitment, but making a commitment to quality and
performance excellence is still dif cult for managers.
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What are the similarities in the quality improvement philosophies of Deming, Juran, and
Crosby
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What are the similarities in the quality improvement philosophies of Deming, Juran, and
Crosby
Ans:
The philosophies of Deming, Juran, and Crosby are more alike than different.
Each views quality as imperative in the future competitiveness in global markets; Makes
top management commitment an absolute necessity;
Demonstrates that quality management practices will save, not cost money;
Places responsibility for quality on management, not the workers;
Stresses the need for continuous, never-ending improvement;
Acknowledges the importance of the customer and strong management/worker
partnerships; and
Recognizes the need for and dif culties associated with changing the organizational
culture.
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