QFD/HOQ: Strategic tool for designing

products, services, processes

Notes and Examples

 Quality Function Deployment (QFD)

And
House of Quality (HOQ)

Quality function deployment or "QFD" is a flexible and comprehensive group decision

making technique used in product or service development, brand marketing, and
product management.

QFD can strongly help an organization focus on the critical characteristics of a new
or existing product or service from the separate viewpoints of the customer market
segments, company, or technology-development needs. The results of the technique
yield transparent and visible graphs and matrices that can be reused for future
product/service developments.

QFD has been adopted by several corporations and organizations.

QFD transforms customer needs (the voice of the customer [VOC]) into engineering
characteristics (and appropriate test methods) of a product or service, prioritizing
each product/service characteristic while simultaneously setting development targets
for product or service development.

Benefits of QFD

The main 'process' benefits of using QFD are:

 improved communication and sharing of information within a cross-functional

team charged with developing a new product or service. This team will
typically include people from a variety of functional groups, such as
marketing, sales, service, distribution, product/service engineering, process
engineering, procurement, and production
 the identification of 'holes' in the current knowledge of the design team
 the capture and display of a wide variety of important design information in
one place in a compact form
 support for understanding, consensus, and decision making, especially when
complex relationships and trade-offs are involved
 the creation of an informational base which is valuable for repeated cycles of
product/service improvement

The main 'bottom line' benefits of using QFD are:

 greater likelihood of product/service success in the marketplace, due to the

precise targeting of key customer requirements
 reduced overall design cycle time, mainly due to a reduction in time-
consuming design changes. This is a powerful benefit: customer
requirements are less likely to have changed since the beginning of the
design project; and more frequent design cycles mean that products/services
can be improved more rapidly than the competition
 reduced overall cost due to reducing design changes, which are not only time
consuming but very costly, especially those which occur at a late stage.
 reduced product/service cost by eliminating redundant features and over-
design.
The Process of Constructing House of Quality (HOQ)

House of Quality is the most important component of QFD. Its general framework
looks as follows:

Step 1: Customer Requirements

This information is gathered via customer surveys in which they are encouraged to
describe their needs and problems. The list of customer requirements must be
structured before entry in HOQ. Affinity Diagrams or Tree Diagrams can be sued to
do this.

Affinity Diagrams:

Each customer statement is written on a separate card. These cards are then
arranged into groups with perceived associations by the QFD team. For example, in
case of Rock Climbing Harness product development (Example 2):

Safe Comfortable Fits over Does not restrict

different clothes movement

Does not restrict Attractive Easy to put on Light weight

movement
Accessible Safe
Accessible gear loops
Fits over gear loops
different clothes Comfortable
Light weight
Easy to put on Attractive
 From each group, a title card is chosen (or made afresh) which reflects the meaning
contained in that group.

A second grouping exercise can be done to sort these group title cards into higher
level associations. For example:

Usability Performance
FACILITATES
Fits over Does not restrict CLIMBING
different clothes movement Usability
Easy to put on Light weight
Performance
Accessible Safe
gear loops Attractive

Comfortable
Attractive

Tree Diagrams:

The final affinity diagram can be the basis of a tree diagram. For example:

FACILITATES
CLIMBING

Usability Performance Attractive

Fits over Easy to Accessible Comfortable Does not Light Safe

different put on gear loops restrict weight
clothes movement

Step 2: Planning Matrix

The Planning Matrix does two things: (i) it quantifies the customers’ requirement
priorities, and (ii) it quantifies customers’ perceptions of the performance of existing
products/services along with comparison with key competitors. This information are
gathered via customer surveys.

Various measures listed in Planning Matrix are:

Importance Weighting: This quantifies relative importance of each customer

requirement. Techniques like structured questionnaire or AHP (Analytic Hierarchy
Process) can be used for this purpose.

Care must be taken to include only single market segment for any one HOQ matrix.
Customer Evaluation: Using a predefined scale, customers are asked to rate the
company’s and key competitors’ product/service. Structured questionnaire or AHP
technique can be used here too.

The design and marketing teams could also include other measures like:

Sales Point: This measure can be used to add weight to those requirements which
can be utilized to market the product (usually between 1 and 1.5).

Planned Satisfaction Rating or Improvement Goal: This quantifies design team’s

desired performance of the product/service on each customer requirement.

Improvement Factor: This ca be calculated by subtracting the performance score of

the company’s existing product/service from its planned performance score, i.e. the
number of improvement points. This different is converted into an improvement
increment (e.g. 0.2) and this is added to 1 to give the improvement factor.

Overall Weighting: This score is calculated for each customer requirement by

multiplying the Importance Weighting by Improvement Factor and Sales Point.

Step 3: Technical Requirements

This is referred to as Design Characteristics or ‘Voice of the Company’. This

information is generated by the design team who identify all the measurable
characteristics of the product/service. These are structured and categorized in a way
similar to that of customer requirements, i.e. with help of Affinity and Tree Diagrams.

An additional row indicates the direction of desired change in each of these variables.

Step 4: Inter-relationships Matrix

This matrix translates the customer requirements into the technical characteristics of
the product/service. Each combination of customer and technical requirement is
considered in turn by the QFD team. For example, ‘How significant is padding
thickness in satisfying comfort when hanging?’

The level if inter-relationship is weighted usually on a four point scale (high, medium,
low, none). For example:
Step 5: Roof Matrix

This triangular matrix is used to identify whether the technical characteristics of the
product/service support or impede one another. For each cell, the following question
is asked: ‘Does improving one characteristic cause a deterioration or improvement
(or no change) in the other technical characteristic?’

Different levels of such positive or negative effects (e.g. strong, medium, weak) can
be indicated using different symbols. For example:

Step 6: Targets

This is the final section of HOQ. It summarizes the conclusions drawn from the data
in the entire HOQ matrix and the team’s discussions.

It generally consists of three parts:

Technical Priorities or Absolute Weights or Importance Rating: The relative

importance of each technical characteristic of the product/service in meeting
customer requirements can be calculated from the weightings contained in the
Planning and Inter-relationship matrix sections.
For example,
Importance Rating = Customer Importance x Inter-relationship Weight x Sales Point x Improvement Factor
Or,
Importance Rating = Overall Weight x Inter-relationship Weight
Competitive Benchmarking or Technical Evaluation: Each technical
characteristic is measured for company’s product/service and key competitors’
products/services. This highlights relative technical position of existing
product/service and helps to identify target level of performance to be achieved in the
new/modified product/service for improvement. For example:

Design Targets: The final output of HOQ is the target value for every technical
characteristic to be achieved in the new or modified product/service. In other words,
this is the set of design (or engineering) specifications to be met.

These targets have been directly arrived based on customer needs, company’s
current performance, and competitors’ performance. The QFD team needs to take all
information contained in the HOQ matrix to come up with the target values. For
example:

Other Steps in QFD

After completing HOQ matrix for the product/service, the next step can be use it for
specifying technical characteristics of the components and parts (or activities in a
service) as well. This would involve constructing HOQ for the parts. This exercise
would result in the Set of Target Values for Parts.

Next, the Target Values for Parts or Activities can be used to construct HOQ for the
Process. This exercise would result in the Set of Targets for Process.
Example 1: QFD for ‘Refrigerator’ Design Improvement
Example 2: QFD for ‘Rock Climbing Harness’ Design Improvement