Prepared by Jc Noel C. Fermano

In collaboration withJustin Ross Alesna

Rizza Krystelle BalbaChristian Philip Lozano

Operations ManagementQuality Management and International

Standards

Quality and StrategyQuality is a term that means different

things to different people. Quality is defined as “the totality of

features and characteristics of a product or service that bears ability to satisfy stated or implied needs.”

Quality requires building a total quality management(TQM) environment because quality cannot be inspected into a product.

Defining Quality“Operations manager’s objective is to build

a total quality management system that identifies and satisfies customer needs.”

American Society for Quality: “The totality of features and characteristics of a product or service that bears the ability to satisfy stated or implied needs.”

Others define quality from: user based, manufacturing based, and product based.

Defining QualityImplications of QualityCompany ReputationProduct LiabilityGlobal implication

Defining QualityMalcolm Baldridge National Quality

AwardAward conferred to quality achievements

that was established by the U.S.Named after former Secretary of Commerce

Malcolm Baldridge.

Defining QualityISO 9000 International Quality

StandardsQuality standard with international

recognition.Focuses to enhance success through eight

quality management principles namely: top management leadership, customer satisfaction, continual improvement, involvement of people, process analysis, use of data-driven decision making, a systems approach, and mutually beneficial supplier relationship.

Defining QualityCost of QualityPrevention costsAppraisal costsInternal failure costsExternal failure costs

Defining QualityEthics and Quality ManagementOne of the most important jobs is to deliver

healthy, safe, and quality products and services to customers.

Total Quality ManagementTotal Quality Management(TQM) refers to a

quality emphasis that encompasses the entire organization, from supplier to customer.

Total Quality ManagementContinuous ImprovementTQM requires a never-ending process of

continuous improvement that covers people, equipment, suppliers, and procedures.

Plan-Do-Check-Act

Total Quality ManagementSix SigmaHas two meanings in TQM: statistical and

program.Developed by Motorola in the 1980s in

response to customer complaints about its products about its products and in response to stiff competition.

Total Quality ManagementEmployee EmpowermentInvolving employees in every step of the

production process.Techniques include:

1. building communication networks that include employees.2. developing open and supportive supervisors.3. moving responsibility from both managers and staff to production employees.4. building high-morale organizations; and5. creating such formal organization structures as teams and quality circles.

Total Quality ManagementBenchmarkingInvolves selecting a demonstrated standard

of products, services, costs, or practices that represent the very best performance for processes or activities very similar to your own.

Total Quality ManagementJust-In-Time (JIT)JIT systems are designed to produce or

deliver goods just as they are needed. JIT is related to quality in three ways:1. JIT cuts the cost of quality2. JIT improves quality3. Better quality means less inventory and a

better, easier-to-employ JIT system

Total Quality ManagementTaguchi ConceptsConceptualized by Genichi Taguchi.Composed of concepts aimed at improving

both product and process quality, namely:1. Quality robustness2. Quality loss function3. Target-oriented quality

Total Quality ManagementKnowledge of TQM ToolsComposed of the following:

A. Tools for Generating Ideas1. Check Sheet2. Scatter Diagram3. Cause-and-Effect diagram

B. Tools for Organizing the Data1. Pareto Chart2. Flowchart

C. Tools for Identifying Problems1. Histogram2. Statistical Process Control Chart

Tools of TQMCheck Sheets

Tools of TQMScatter Diagrams

Tools of TQMCause-and-Effect Diagrams

Tools of TQMPareto Charts

Tools of TQMFlowcharts

Tools of TQMHistograms

Tools of TQMStatistical Process Control (SPC)

The Role of InspectionWhen and Where to InspectDepends on the type of process and the value added

at each stage.Inspections can take place at any of the following

points:1. At your supplier’s plant while the supplier is producing.2. At your facility upon receipt of goods from your

supplier.3. Before costly or irreversible processes.4. During the step-by-step production process.5. When production or service is complete.6. Before delivery to your customer.7. At the point of customer contact.

The Role of InspectionSource InspectionControlling or monitoring at the point of

production or purchase – at the source.Inspection may be assisted by the use of

controls and fail-safe device poka-yoke. (JPN: “foolproof”)

The Role of InspectionService Industry InspectionIn service-oriented organizations,

inspection points can be assigned at a wide range of locations.

Operations Manager must decide where inspections are justified and may find the seven tools of TQM useful in making these judgements.

The Role of InspectionInspection of Attributes versus

VariablesQualities may be measured as either

attributes or variables.Attribute Inspection classifies items as

being either good or defective without assessing the degree of failure.

Variable Inspection measures dimensions to see if an item falls within an acceptable range.

TQM in ServicesTQM in ServicesDeterminants of Service Quality

1. Reliability2. Responsiveness3. Access4. Communication5. Credibility6. Security7. Understanding/Knowing the customer8. Tangibles