CHAPTER – 19
Quality Management
Nature and Importance of quality.
Definition and development of quality.
Dimensions of quality, determinants of quality.
Causes of quality failure, quality control, inspection, quantity assurance.
Quality in services, quality costs, management effortsM failures.
Modern quality management, quality and productivity, quality circles.
ISO-9000 quality standards, objectives, implementation, benefits, constraints.
ISO-14000 on environment.
Total quality concept, employee involvement and empowerment, TQC.
TQM, Essentials of TQM, Top management leadership, HRD.
Process management in TQM, Benefits due to TQM.
TQM ‘Gurus’ and their contributions.
Introduction to six sigma quality concepts.
Nature and Importance of Quality
Quality aspect has grown with humanity. Thousands of years back
Stone Age people used sharp stones or sharp weapons to hunt. This
shows they knew the qualitative difference in too centuries old
temples, churches, masjids tell us enormous thinking has gone in
building them from quality point of view.
Definitions and Development of Quality
“Quality is meeting or exceeding customer’s expectations”.
“Quality is the totality of features and characteristics of a product
or service that bears on its ability to satisfy stated or implied
needs”.
“Quality is meeting or exceeding customer requirements now and
in future”.
“Quality is sum of the attributes that can describe a project”.
“Quality is sum of the attributes that can describe a product”.
“Quality refers to meeting specifications and performance
standards”.
Most of the definitions are made by recent authors and all these
Dimensions of Quality
Dimension of quality are attributes or factors of quality,
which are commonly uttered as evaluation factors. These are
the factors regularly talked by common people,
1) Reliability
2) Durability
3) Performance
4) Innovative
5) Service Aspect
6) Aesthetics
7) Safety
Factors of production-oriented units
For service and service cum production units following factors:
a) Prompt Response
b) Courtesy
c) Accessibility
d) Credibility
e) Proactive
Benefits of Quality
1) Image of the organization will be high: the improved reputation can lead
to be a major player in the competition.
2) For consistency in quality market share will increase and consequently
sales and profits will be higher.
3) Due to improved quality, the re-work and delays are avoided or reduced.
This reduces the manufacturing costs.
4) Productivity will increase due to no-rework and lenser inspectors’ time
spent.
5) Cost of manufacturing will come down due to better utilization of operator
time, reduced wastage and reduction in scrap.
6) Sales activity will be on strong footing as sales personnel will have high
problem due to consistency in quality.
7) Employee morale at all level will be high. This will improve work
atmosphere and lead to better team work.
8) New jobs, challenging jobs will be normally given to a company, which has
high reputation for quality.
Determinants of Quality
Many direct and indirect activities contribute to the quality
and consistency
i. Design Stage
ii. Materials Stage:
iii. Process stage:
iv. Quality to specifications:
v. Organization Focus
vi. Training and Re-training of HR
Causes of Quality Failure
Man power Related
Facilities Related
Process Related
Materials Related
Environment Related
Inspection
The objectives of inspection are:
To accept incoming materials that meet the specified standards
and reject those which do not meet the standards specified
To check the in process components with specifications and
accept or reject based on evaluation and
To test the final product as per specification and accept or
suggest for corrections to be attended.
Inspection in common usage is called ‘Post-mortem’
Different types of inspection are:
i. Visual Inspection
ii. Sub-surface inspection
iii. Specification check
iv. Trial runs
Quality Assurance
‘Quality Assurance’ refers to activities aimed to
provide desired quality products to customer. This
mainly involves the built-in process care for quality.
The process system itself should be developed such
that the output is of desired quality activities that
help to take on of quality assurance are
1) Reliable Process
2) Consumer Feedback
3) Value Engineering
4) Service Aspects
5) Design of Product
Quality Costs
(i) Internal Failure Costs
Rejection create scrap and this means instead of selling product, scrap will be sold
which is a big loss. More the generation of scrap more the losses
For corrective action re-work has to be done and the re-work requires additional
investment of operations etc which is additional cost.
Extra cost will be incurred due to detailed tests, inspection, re-inspection, and
change of specialisations, methods, expert consultation and sometimes
outsourcing.
Under utilization of manpower and machineries due to re-work, re-inspection. This
will effect speed, efficiency and concentration of employees. Hence output
quantum will reduce.
(ii) External Failure Costs
During warranty period free replacements of spares and servicing has to be
attended which costs extra.
Loss of reputation due to which further orders may get affected. Also the existing
customer may delay balance payments due to failures.
For attending customer complaints, movement of employees, materials etc. costs
very high. Further if salvaging work has to be attended outstations the hiring of
services and facilities costs extra.
Demoralization of employees and low image in the market will be difficult to
measure
(iii) Appraisal Costs: This covers inspection, re-inspection
Incoming raw materials, components, sub-assemblies, bought outs (like motor, bulbs)
are to be tested, or evaluated as per specifications.
Stage inspection in process as per manual, either this will be on random sample
basis, hourly basis or shift basis depending upon product and specifications.
Evaluation of finish product for all attributes of performance, aesthetics, packing etc.
Costs of calibrating, measuring and test equipments towards keeping them in
accurate condition.
Costs of vendor evaluation, visit to their works and in turns their sub-contractors if
any.
Cost of maintaining laboratories like chemical labs, physical labs, metallurogical
labs, electronics labs for different types of tests required to attend on regular basis.
(iv) Prevention Costs
Maintaining a quality department, training of personnel.
Cost of preparing quality plan, systems and procedures as per the quality manual.
Data collections of quality matter, data analysis, preparing charts to know the
deviations and management reporting.
Costs pertaining to vendor evaluation, value analysis methods, engineering and time
study.
Costs towards (i) Quality circles and (ii) R&D department.
Modern Quality Management
Modern quality management is based on continuous improvement in quality,
productivity and customer satisfaction. Organization has to fully involve
employees, suppliers,
Mission: Our mission is to continually improve our products and services to
meet our customers’ needs
Values
People
Products
Profits:
Guiding Principles
Quality comes first
Customers are the focus of everything we do
Continuous improvement is essential to our succes
Employee involvement is our way of life
Dealers and suppliers are our partners: The company must maintain
mutually beneficial relationship with suppliers, dealers, an
Integrity is never compromised
Quality and Productivity
Advantages of quality on productivity
Reduced wastage and hence lesser or nil scrap
generation.
Machine hours and labour hours are invested in quality
production and hence resources are not wasted.
More production due to fuller utilization of resources.
Customer satisfaction is achieved due to quality
products.
There is scope to reduce price and improve market share
due to cost savings in production by eliminating
rejections and re-work.
Another alternative to sales force is to fix higher price
than competitors due to better quality and reliability.
Employee satisfaction and job security will increase.
Quality Circles
Quality circle is a small group of employees says 8 to 10
working as a group. They meet once a week for one hour or
more to discuss work related problems. Each unit will have one
group and the group will have employees from different trades
and skills to obtain varied ideas for problem solving exercise.
The experience and inherent ability of employee will be made
most use of for any production and quality related matters.
Objectives of Quality Circle
To make best use of available resources
To help employees contribute ideas for improvements in
productivity and quality.
To promote participative culture and team work
To improve overall organization image and employee morale.
Benefits of Quality Circle
Improvements in productivity and quality
More involvement and better participation of workers
Improvement in inter-personal relationship, team work
Greater sense of belonging and organization pride.
Better safety, house keeping, cost reduction
Image of the company in public minds will enhance.
ISO-9000 Quality Standards
International organization for standardisation (ESTD 1946)
having 91 nation members for long was feeling need of a
universal standard for import–export transactions.
Once a standard is formulated all the member countries will
follow it or its equivalent code to have uniformity, specialty of
quality standards.
This will serve in a big way to thousands of companies busy in
import-export trade. The ISO certification serves as a quality
standard the company is following.
All the nations respect this certification and some companies
insist their buyers to buy from ISO certified companies only.
ISO 9000 quality standards
ISO 9001-QA Design, Production, Installation and servicing
ISO – 9002 – QA for Production, Installation.
ISO – 9003 QA for Final Inspection, Test.
ISO – 9004 – Quality management guidelines.
Benefits of ISO-9000
The organisation gets market credibility as
quality caring firm and preferred for supplies.
Improves the chances of expert orders.
Wastages, rejections are reduced and hence
cost of manufacturing is reduced.
Customers are satisfied and hence business
thrives. Market share may increase.
Employee morals will be high.
Constraints of ISO–9000
Very high involvement of owners, directors
and more care for quality than quantity.
Monetary sanction is required for quality
care.
The procedure is too elaborate, bureaucratic
type.
It is procedure oriented. It is difficult to put it
into practice
Finance and marketing, two important
departments are not covered
Essentials of TQM Culture
In constant pursuit of customer satisfaction. Attend customer feed back
Commitment of the management and giving a lead to develop TQM culture.
To formulate organizational quality policy to be a guideline to all employees.
Formation of organization structure, which should be effective
Human resources involvement at all levels in the quality culture development.
To keep watch on quality costs, especially those of repeat work and waste type.
Involving outsiders (vendors) in the TQM system.
To create an award/ reward system to good performers.
Team building for cohesive working leads to better performance.
Continuous improvement about product is never ending quest.
Method of internal and external customers to be followed
Work methods have taken care of quality work then inspection is least required.
Top management responsibility is 85% and the balance is worker’s
responsibility.
Training and re-training in quality related functions are a necessity for
continuous improvement.
Benefits due to TQM
a) Tangible Benefits
Substantial reduction in quality costs.
Increase in profitability due to productivity and nil or
negligible re-work costs.
Market share and sales will improve.
Reduced service expenses.
b) Intangible Benefits
Employee morale and company image will be high.
Employee involvement and team work will improve.
A satisfied customer can be a good sales link.
Flow of information and human relations will be
better.
Six Sigma Quality
Six Sigma (6) is the stringent quality standard developed by M/s
Motorola Company and this is yet to get wide publicity and adaptation.
The non-conformance tolerated is 0.001 ppm in each trial. To
understand more on this first let us take the assumption of 3 standard
deviations (3).
99.73% is with the upper and lower tolerance units and acceptable
balance 0.27% is out of limits and unacceptable. In minimum pieces this
will be 2,700 Nos. outwardly this appears a good result. But if we take
medical operations, air flights, electricity supply, water supply, new
baby handling and such examples the 2,700 ppm failures also is very
costly or objectionable. However in industrial and business activity the
six sigma (6) can be represented as HIGH.
In this standard of quality there will be maximum 3.4 ppm defective
components. This can be achieved with the aid of (a) Design and
Engineering, (b) SPC, (c) Vendor Development, (d) Employee training
and involvement and (e) Standardization of parts, specifications and
hard work.