baldrige quality 09c
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Quality Philosophies and Standards
Britt WatwoodCenter for Teaching Excellence
VCU
Still Relevant…in the last year
What is meant by the term?
“Quality”
Quality’s Foundation
Quality
Philosophy &Practice
Tools
Empowerment
Quality Evolution
• 1930’s– Shewart Cycle
• 1950’s– Deming in Japan
• 1980– Productivity / Quality
Circles• 1985
– Deming/Crosby/Juran• Late 1980’s
– Total Quality Mgmt• 1990’s
– Baldrige Criteria• Current
– Six Sigma– Lean Management
Quality Overview
QMSMarkets &Customers
VOCLean
6 σ
ProductOperation
StrategyFormulation
ProductSupport
Quality
Malcolm Baldrige NQA
• Twenty years evolving• A Framework and A Tool• Self-Assessment• Promotes Awareness of
Continuous Improvement and Excellence
• Sharing of Best Practices• Presented by the President
of the United States
Baldrige is a
“Process”
Visionary Leadership
Core Values
Customer Driven
Excellence
Organizational Learning
Core Values
Valuing Employees
&Partners
Agility
Core Values
Focus on the Future
Managing For
Innovation
Core Values
Management By
Fact
Social Responsibility
Core Values
Results & Value
• Focus on Key Results
• Creating Value for Stakeholders
• Customers• Employees• Stockholders• Suppliers / Partners• The Community
• Both Leading and Lagging Indicators
Baldrige Criteria
4 Measurement, Analysis & Knowledge Management
1Leadership
Organizational ProfileEnvironment, Relationships, &
Challenges
2StrategicPlanning
3Customer &
Market Focus
6ProcessMgmt
5Workforce
Focus7
BusinessResults
120
90
85 85
85 85
450
BalancedScorecard
Model
Comparison
M B N Q A Balanced Scorecard
ISO 9001:2000
LeadershipStrategic Planning
Vision and Strategy
Quality PolicyQuality objectives
Customer & Market Focus
Workforce Focus
Customer Customer focusCustomer related processesCustomer satisfaction
Process MgmtMeasurement, Analysis & KM
Internal Business Processes
QMS General requirementsProduct Realization
Business Results Organization’s Business Results
Not specifically addressed in the standard.
Standard Deviation
Sigma is a measure ofvariation
Sigma Variation
• The sigma value is a metric that indicates how well a process is performing.
• The higher the sigma value, the better.
• The higher the sigma value, the more the process is defect-free.
Example of Sigma Value
Yield DPMO Sigma
30.9%690,000 169.2%308,000 293.3% 66,800 399.94% 6,210
499.98% 320
599.9997% 3.4
6
Yield DPMO Sigma
30.9%690,000 169.2%308,000 293.3% 66,800 399.94% 6,210 499.98% 320 599.9997% 3.4 6
Most companies operate at around 4 sigma – the quality standard set by the US Government in WW II
Example of Sigma Value
What Does 99% Defect-Free Mean?
• 200,000 wrong drug prescriptions each year
What Does 99% Defect-Free Mean?
• Two short or long landings at major airports each day
What Does 99% Defect-Free Mean?
• 5,000 incorrect surgical procedures every week
What Does 99% Defect-Free Mean?
• 20,000 lost articles of mail every hour
What Does 99% Defect-Free Mean?
• Unsafe Drinking Water for 15 minutes each day
What Does 99% Defect-Free Mean?
• No electricity for 7 hours each month
What Does 99% Defect-Free Mean?
• 50 dropped newborns at the hospital each day
What Does 99% Defect-Free Mean?
Defects Effect Costs• The Cost of Quality
– 4 Sigma: 99.4%• 6,210 defects• Industry Average• Lose 15-20% of sales
– 5 Sigma: 99.98%• 233 defects• Lose 5-10% of sales
– 6 Sigma: 99.9997%• 3.4 defects• Lose Less than 1% of
sales
As a nation,we seem to be obsessed
with LEAN…
Effectiveness vs Efficiency
V O C6 σ
Selection6 σ
Control6 σ
Improvement
ProcessMetrics
LeanMetrics
LeanWorkload
LeanProcess
Six Sigma = Effectiveness
Lean Mgmt = Efficiency
• The term “lean” is used because lean manufacturing uses “less”…
Labor in the factoryManufacturing spaceCapital investmentMaterialsTime between the customer order and the product shipment
Definition
Continuous flow
Batch size
Production
Layout
Processing
Quality
Based on forecast
Based on function / department
Large
Batch & queue
Lot sampling
Based on orders
Based on product flow
Small
Assured during processing
Traditional Lean
Lean Mgmt Comparison
Key Elements:
• Stability• Quality• Continuous Flow• Kaizen• Pull System• Workload Balancing
Waste
“Anything that adds Cost
to the product without adding Value”
“Anything that adds Cost
to the product without adding Value”
Non - Value Added: 95%
Value Added: 5%
Waste
• Overproduction• Excess Inventory• Product Defects• Non-value added
processing• Wait time• Underutilized
labor• Excess motion• Unnecessary
Transportation
7 Types of Muda
Typesof
Waste
CORRECTION
WAITING
PROCESSING
MOTION
INVENTORYCONVEYANCE
OVERPRODUCTION
Repair orRework Any wasted motion
to pick up parts or stack parts. Also wasted walking
Wasted effort to transportmaterials, parts, or finished goods into or out of storage, or between processes.
Producing morethan is needed before it is needed
Maintaining excessinventory of raw mat’ls,parts in process, orfinished goods.
Doing more work thanis necessary
Any non-work timewaiting for tools, supplies, parts, etc..
Workplace
Organization
Maintain through empowerment,
commitment, and discipline
Sort
Sustain Set In Order
ShineStandardize
Keep machines and workareas clean
Use standard methods to keep Sort, Set In Order,
and Shine to a condition
Organize the work area
5 S
Get rid of clutter
KAITo modify /
Change
ZENTo make good /
better+
= KAIZEN
Gradual and orderly, continuous improvement.
Differences in Emphasis
• Six Sigma– Process Improvement– Reduced Defect Rate
• Lean– Efficiency Improvement– Reduce Waste
• Baldrige Criteria– Performance Excellence
across Entire System– Results Oriented
What MakesSense For
YOURCompany ???
Questions???