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SQC Simulation Solution

The simulation focuses on managing quality through statistical process control, process capability analysis, and cost of quality calculations. There are two types of defects: internal defects occurring during production like scraps or reworks, and external defects from returned goods. The simulation involves four challenges - using control charts to monitor a production process; determining when a process is out of control and how to correct it; calculating process capability indices; and determining the optimal investment levels in equipment, training, and inspection to minimize total quality costs.

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333 views2 pages

SQC Simulation Solution

The simulation focuses on managing quality through statistical process control, process capability analysis, and cost of quality calculations. There are two types of defects: internal defects occurring during production like scraps or reworks, and external defects from returned goods. The simulation involves four challenges - using control charts to monitor a production process; determining when a process is out of control and how to correct it; calculating process capability indices; and determining the optimal investment levels in equipment, training, and inspection to minimize total quality costs.

Uploaded by

mdasifkhan2013
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Operation Management Simulation: Quality Analytics MBA 513

Barinder Mangat, Rushabh Vedia

The purpose of this simulation is to help us understand about managing quality in different settings through
analytics related to statistical process control, process capability, and the cost of quality. There are two kind of
defects

Internal Defects They are also known as In-house defects. These defects occur when internally there are issues of
scraps or when there is rework to be done. Higher scraps leads to higher wastages and could lead to
underutilization of resources. Rework or repairs increases the lead time or cycle time since the flow of production
is disrupted.

External Defects Many goods that are returned due to lower quality or some sort of damage ads to the inventory
and rework areas thereby increasing the costs. Customers feedback is crucial as any changes in the goods to be
made can be done at the production line. Simulation Learning

Managing Control Limit

Using Control Limit to Control Process

Analysing the Control Charts

Making managerial investments to minimize the total cost of quality In the 1

st
challenge - On each simulation run a random sample is collected from the batch and the mean(X-bar) and range(R-
chart) are calculated. We could observe the fluctuations in the data which helped us understand how to calculate
the control limits. In the 2

nd

challenge - Whenever we have processes that are out of control we can either change the labour or recalibrate the
equipment or do both. There was cost associated with every option that was selected. Thus there should exists a
balance between the labours employed and the machines that are running /installed, only then there would be a
lower cost in conducting the processes. In the 3

rd

challenge - Process capability index (CPK) is the measure of process capability and it helps understand and
calculate the capability index and the process which ought to be implemented under the limits. In the 4

th

Challenge - Factors such as investment in labour training and equipment are necessary to reduce the costs. Higher
investment in equipment and no investment in labour training hours would still have multiple defects in the
production. Labour training investment kept at $1250 and equipment investment of $4000 or higher along with
sample size of 5 to $5.50, there will be a reduction in the total cost of quality up to $8.4K which includes 0 defects

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