Ch03 Quality

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    Chapter 3: Quality Management 2

    What business are you in?

    CEO of GM announced, GM wasnt in

    the business of making cars, GM was in

    the business of making money. Taylor > Drucker > McNamara

    According to Tom Peters from In Search of

    Excellence fame

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    Chapter 3: Quality Management 3

    Chapter 3

    Quality Management

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    4

    Chapter 3:

    Quality Management

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    Chapter 3: Quality Management 5

    Examples

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    Chapter 3: Quality Management 6

    West Babylon School District

    Began applying continuousimprovement and quality to its

    administrative and education processes. TQE

    Applied Demings 14 Points for

    management to administrative process. Numerous improvements made.

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    Chapter 3: Quality Management 8

    National Semiconductorcont inued

    Second stage of quality initiatives (1990s) Focused on customer-supplier relationships

    Customer satisfaction Customer score cards

    Process analysis

    Employee empowerment

    Team strategies

    Problem solving techniques

    Visioning

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    Chapter 3: Quality Management 10

    NCR

    Produces business informationprocessing systems

    Recognized need to continuouslyimprove its products

    Major component of its continuous

    improvement program is use ofstatistical techniques

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    Chapter 3: Quality Management 11

    NCR cont inued

    Began using statistical process controltechniques in 1985 to monitor its

    autoinsertion operation on its printedcircuit board assembly line.

    Line was producing an unacceptable

    number of defects. Reasons included misinserted or broken

    parts, using the wrong parts and so on.

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    Chapter 3: Quality Management 12

    NCR cont inued

    Quality engineering departmentestablished process averages, controllimits and guidelines for action for out-of-control conditions. Production was stopped when out-of-control

    condition detected until cause identified.

    Random samples of 1000 insertions were collectedeach hour and the results plotted on a cchart.

    Out-of-control situations were investigated toidentify the assignable cause.

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    Chapter 3: Quality Management 14

    Timber Companies

    Because of environmental restrictionsand limited quantities of large-diameter

    trees, many timber companies are usingstatistical quality control techniques tomaximize the quality and quantity of

    finished lumber produced

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    Chapter 3: Quality Management 15

    Converting Logs into Finished

    Lumber

    Debarked log split down the middle

    Split log resawed to create boards

    Ends of boards trimmed Boards are stacked

    Log debarked

    Boards dried in kiln for 2 to 30 days

    Boards are planed

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    Chapter 3: Quality Management 16

    Applying SPC

    to the Stacking Operation

    Important because this determinesstraightness of finished lumber.

    Lumber stacked in layers. Separators placed between layers to form

    air channels and transfer weight of wood.

    Automated equipment used to stacklumber making it necessary to monitorthe alignment of the separators.

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    Chapter 3: Quality Management 17

    Stacking Operation cont inued

    Estimated cost of misplaced separator is$31.50 owing to board warping.

    Average sawmill handles upwards of30,000 separators each day.

    Measuring board placed in front of eachcolumn of separators to monitor separatoralignment.

    Stack of lumber contains approximately 15

    columns of separators and 360 separators.

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    Chapter 3: Quality Management 18

    Stacking Operation conc luded

    Total number of misplaced separators isdivided by the total number of

    separators in the stack of lumber andresult plotted on p chart.

    Usingp chart, workers monitor the

    stacking equipment and identifyproblems before an out-of-controlsituation arises.

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    Chapter 3: Quality Management 19

    Quality ManagementPerspectives

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    Chapter 3: Quality Management 20

    Quality Costs

    Two primary sets of costs involved inquality

    Control costs Failure costs

    These costs are often as high as 15 to

    35% of sales Costs often broken down into four

    categories

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    Chapter 3: Quality Management 21

    Category 1:

    Prevention Costs

    Costs associated with trying to preventdefects and errors

    Training for quality Educating suppliers

    Designing product for quality

    Designing production system for quality Preventive maintenance

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    Chapter 3: Quality Management 22

    Category 2:

    Appraisal Costs

    Costs of determining current quality

    Measuring and testing parts

    Running special test laboratories Acquiring special testing equipment

    Conducting statistical process control

    Inspecting incoming materials

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    Chapter 3: Quality Management 23

    Category 3:

    Internal Costs of Defects

    Costs incurred when defects are foundbefore shipment/delivery to customer.

    Labor and materials going into scrap Reworking and retesting to correct defects

    Downtime of equipment and labor while

    waiting for repairs Yield losses

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    Chapter 3: Quality Management 24

    Category 4:

    External Costs of Defects

    Costs of trying to correct defects afterreceipt by customer.

    Lost of customer goodwill Recalls to correct problem

    Warranty, insurance, and legal suit

    settlements

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    Chapter 3: Quality Management 26

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    Chapter 3: Quality Management 27

    W. Edwards Deming

    Major source of poor quality is variat ion

    Quality improvement the responsibility

    of top managementAll employees should be trained in use

    of problem solving tools and especially

    statistical techniques

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    Chapter 3: Quality Management 28

    Demings 14 Points

    Create constancy of purpose

    Adopt the new philosophy

    Cease dependence on mass inspection End practice of awarding business on

    basis of price tags

    Improve constantly and forever

    Institute modern methods of training

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    Chapter 3: Quality Management 29

    Demings 14 Points cont inued

    Institute modern method of supervision

    Drive out fear

    Breakdown organizational barriers Eliminate arbitrary numerical goals

    Eliminate work standards and quotas

    Remove barriers that reduce pride ofworkmanship

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    Chapter 3: Quality Management 31

    Joseph Juran

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    Chapter 3: Quality Management 32

    Joseph Juran

    Quality Control Handbook(1951)

    Quality Trilogy

    Quality Planning Quality Control

    Quality Improvement

    Need to place more emphasis onplanning and improvement

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    Chapter 3: Quality Management 34

    Phillip Crosby

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    Chapter 3: Quality Management 35

    Philip B. Crosby

    Quality is conformance to requirements,not elegance

    Better to produce item right the first timethan to try to inspect quality in

    Qual ity at the source- responsibility

    shifted from quality control departmentto workers

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    Chapter 3: Quality Management 37

    Economic Control of Quality of Manufactured Product(1931)

    --- -- -

    http://www.expira.se/images/shewh1.gif
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    Chapter 3: Quality Management 38

    History of TQM

    Dr. Shewart began using statisticalcontrol at the Bell Institute in 1930s

    Military standards developed in 1950sAfter World War II, Japanese Union of

    Scientist and Engineers began

    consulting with Deming Deming Prize introduced in Japan in

    1950

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    Chapter 3: Quality Management 39

    History of TQM cont inued

    Juran writes Total Quality Control 1951

    Juran makes first trip to Japan in 1954

    Quality Japans national slogan in 1956 First quality circles created in 1957

    10,000 quality circles by 1966

    100,000 quality circles by 19