quality control and management. quality and cost of quality “quality is the totality of features...

Quality Control and ManagementQuality Control and Management

Quality and Cost of quality

“Quality is the totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs”

American Society for Quality

““It costs a lot to produce a bad product.”It costs a lot to produce a bad product.”Norman AugustineNorman Augustine

1. Prevention costs

2. Appraisal costs

3. Internal failure costs

4. External failure costs

5. Opportunity costs

External Failure

Internal Failure

Costs of Quality

Total Cost

Quality Improvement

Total Cost

What is quality management all about?

Try to manage all aspects of the organization in order to excel in all dimensions that are

important to “customers”

Two aspects of quality: features: more features that meet customer needs

= higher qualityfreedom from trouble: fewer defects = higher

quality

The Quality Gurus – Edward Deming

1900-1993

1986

Quality is “uniformity and dependability”

Focus on SPC and statistical tools

“14 Points” for management

PDCA method

Deming’s Fourteen Points

TABLE 6.2 Deming’s 14 Points for Implementing Quality Improvement

1. Create consistency of purpose

2. Lead to promote change

3. Build quality into the product; stop depending on inspections to catch problems

4. Build long-term relationships based on performance instead of awarding business on price

5. Continuously improve product, quality, and service

6. Start training

7. Emphasize leadership

Deming’s Fourteen Points

Deming’s 14 Points for Implementing Quality Improvement

8. Drive out fear

9. Break down barriers between departments

10. Stop haranguing workers

11. Support, help, and improve

12. Remove barriers to pride in work

13. Institute a vigorous program of education and self-improvement

14. Put everyone in the company to work on the transformation

The Quality Gurus – Joseph Juran

1904 - 2008

1951

Quality is “fitness for use”

Pareto Principle

Cost of Quality

General management approach as well as statistics

History: how did we get here…

• Deming and Juran outlined the principles of Quality Management.

• Tai-ichi Ohno applies them in Toyota Motors Corp.

• Japan has its National Quality Award (1951).

• U.S. and European firms begin to implement Quality Management programs (1980’s).

• U.S. establishes the Malcolm Baldridge National Quality Award (1987).

• Today, quality is an imperative for any business.

What does Total Quality Management encompass?

TQM is a management philosophy:

• continuous improvement

• leadership development

• partnership development

CulturalAlignment

Technical Tools

(Process Analysis, SPC,

QFD)

Customer

Developing quality specifications

Input Process Output

Design Design quality

Dimensions of quality

Conformance quality

Six Sigma Quality

• A philosophy and set of methods companies use to eliminate defects in their products and processes

• Seeks to reduce variation in the processes that lead to product defects

• The name “six sigma” refers to the variation that exists within plus or minus six standard deviations of the process outputs

6

Six Sigma Quality

Quality Improvement

Traditional

Continuous Improvement

Time

Qua

lity

Continuous improvement philosophy

1. Kaizen: Japanese term for continuous improvement. A step-by-step improvement of business processes.

2. PDCA: Plan-do-check-act as defined by Deming.

Plan Do

Act Check

3. Benchmarking : what do top performers do?

Tools used for continuous improvement

1. Process flowchart


2. Run Chart

Performance

Time


3. Control Charts

Performance Metric

Time


4. Cause and effect diagram (fishbone)

Environment

Machine Man

Method Material


5. Check sheet

Item A B C D E F G

-------

-------

-------

√ √ √

√ √

√ √

√

√

√ √

√ √ √

√

√

√

√

√ √


6. Histogram

Frequency


7. Pareto Analysis

A B C D E F

Freq

uenc

y

Perc

enta

ge

50%

100%

0%

75%

25%10

20

30

40

50

60

Summary of Tools

1. Process flow chart

2. Run diagram

3. Control charts

4. Fishbone

5. Check sheet

6. Histogram

7. Pareto analysis

Case: shortening telephone waiting time…

• A bank is employing a call answering service

• The main goal in terms of quality is “zero waiting time” - customers get a bad impression - company vision to be friendly and easy access

• The question is how to analyze the situation and improve quality

The current process

Customer B

OperatorCustomer A

ReceivingParty

How can we reduce waiting time?

Makes customer wait

Absent receiving party

Working system of operators

Customer Operator

Fishbone diagram analysis

Absent

Out of office

Not at desk

Lunchtime

Too many phone calls

Absent

Not giving receiving party’s coordinates

Complaining

Leaving a message

Lengthy talk

Does not know organization well

Takes too much time to explain

Does not understand customer

Daily average

Total number

A One operator (partner out of office) 14.3 172

B Receiving party not present 6.1 73

C No one present in the section receiving call 5.1 61

D Section and name of the party not given 1.6 19

E Inquiry about branch office locations 1.3 16

F Other reasons 0.8 10

29.2 351

Reasons why customers have to wait(12-day analysis with check sheet)

Pareto Analysis: reasons why customers have to wait

A B C D E F

Frequency Percentage

0%

49%

71.2%

100

200

300 87.1%

150

250

Ideas for improvement

1. Taking lunches on three different shifts

2. Ask all employees to leave messages when leaving desks

3. Compiling a directory where next to personnel’s name appears her/his title

Results of implementing the recommendations

A B C D E F


100%

0%

49%

71.2%

100

200

300 87.1%

100%

B C A D E F


0%

100

200

300

Before… …After

Improvement

In general, how can we monitor quality…?

1. Assignable variation: we can assess the cause

2. Common variation: variation that may not be possible to correct (random variation, random noise)

By observingvariation in

output measures!

Statistical Process Control (SPC)

Every output measure has a target value and a level of “acceptable” variation (upper and lower tolerance limits)

SPC uses samples from output measures to estimate themean and the variation (standard deviation)

Example

We want beer bottles to be filled with 12 FL OZ ± 0.05 FL OZ

Question:

How do we define the output measures?

In order to measure variation we need…

The average (mean) of the observations:

N

iix

NX

1

1

The standard deviation of the observations:

N

XxN

ii

1

2)(

Average & Variation example

Number of pepperoni’s per pizza: 25, 25, 26, 25, 23, 24, 25, 27

Average: 25

Standard Deviation: 1.1

Number of pepperoni’s per pizza: 25, 22, 28, 30, 27, 20, 25, 23

Average: 25

Standard Deviation: 3.17

Which pizza would you rather have?

Accuracy and Consistency

We say that a process is accurate if its mean is close to the target T.

We say that a process is consistent if its standard deviationis low.

X

Control Charts

Control charts tell you when a process measure is exhibiting abnormal behavior.

Upper Control Limit

Central Line

Lower Control Limit

Two Types of Control Charts

• X/R Chart

This is a plot of averages and ranges over time (used for performance measures that are variables)

• p Chart

This is a plot of proportions over time (used for performance measures that are yes/no attributes)

When should we use p charts?

1. When decisions are simple “yes” or “no” by inspection

2. When the sample sizes are large enough (>50)

Sample (day) Items Defective Percentage

1 200 10 0.050

2 200 8 0.040

3 200 9 0.045

4 200 13 0.065

5 200 15 0.075

6 200 25 0.125

7 200 16 0.080

Statistical Process Control with p Charts


Let’s assume that we take t samples of size n …

size) (samplesamples) ofnumber (defects"" ofnumber total

p

n

ppsp

)1(

p

p

zspLCL

zspUCL

066.0151

200680

p

017.0200

)066.01(066.0

ps

015.0 017.03 066.0

117.0 017.03 066.0

LCL

UCL


LCL = 0.015

UCL = 0.117

p = 0.066


When should we use X/R charts?

1. It is not possible to label “good” or “bad”

2. If we have relatively smaller sample sizes (<20)

Statistical Process Control with X/R Charts

Take t samples of size n (sample size should be 5 or more)

n

iix

nX

1

1

}{min }{max ii xxR

R is the range between the highest and the lowest for each sample


X is the mean for each sample

t

jjX

tX

1

1

t

jjR

tR

1

1


X is the average of the averages.

R is the average of the ranges

RAXLCL

RAXUCL

X

X

2

2

define the upper and lower control limits…

RDLCL

RDUCL

R

R

3

4


Read A2, D3, D4 from theTable according to the sample size. In the next example n=5 and A2 =0.58, D3 =0 and D4 =2.11. If sample size n=10, then A2 =0.31, D3 =0.223 and D4 =1.78

Example: SPC for bottle filling…

Sample Observation (xi) Average Range (R)

1 11.90 11.92 12.09 11.91 12.01

2 12.03 12.03 11.92 11.97 12.07

3 11.92 12.02 11.93 12.01 12.07

4 11.96 12.06 12.00 11.91 11.98

5 11.95 12.10 12.03 12.07 12.00

6 11.99 11.98 11.94 12.06 12.06

7 12.00 12.04 11.92 12.00 12.07

8 12.02 12.06 11.94 12.07 12.00

9 12.01 12.06 11.94 11.91 11.94

10 11.92 12.05 11.92 12.09 12.07

Example: SPC for bottle filling…

Sample Observation (xi) Average Range (R)

1 11.90 11.92 12.09 11.91 12.01 11.97 0.19

2 12.03 12.03 11.92 11.97 12.07 12.00 0.15

3 11.92 12.02 11.93 12.01 12.07 11.99 0.15

4 11.96 12.06 12.00 11.91 11.98 11.98 0.15

5 11.95 12.10 12.03 12.07 12.00 12.03 0.15

6 11.99 11.98 11.94 12.06 12.06 12.01 0.12

7 12.00 12.04 11.92 12.00 12.07 12.01 0.15

8 12.02 12.06 11.94 12.07 12.00 12.02 0.13

9 12.01 12.06 11.94 11.91 11.94 11.97 0.15

10 11.92 12.05 11.92 12.09 12.07 12.01 0.17

Calculate the average and the range for each sample…

Then…

00.12X

is the average of the averages

15.0R

is the average of the ranges

Finally…

91.1115.058.000.12

09.1215.058.000.12

X

X

LCL

UCL

Calculate the upper and lower control limits

015.00

22.115.011.2

R

R

LCL

UCL

LCL = 11.90

UCL = 12.10

The X Chart

X = 12.00

The R Chart

LCL = 0.00

R = 0.15

UCL = 0.32

The X/R Chart

LCL

UCL

X

LCL

R

UCL

What can you conclude?

quality control and management. quality and cost of quality “quality is the totality of features...

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