QUALITY MANAGEMENT Professor: Engr.

Rebecca Solera

 QUALITY - Broadly defined as the ability of a product or service to consistently meet or

exceed customer expectations.

 1. AREAS RESPONSIBLE FOR QUALITY

 MARKETING helps to evaluate the level of product quality that the customer wants,
needs, and is willing to pay for. It also provides the product quality data and helps to
determine quality requirements.
 DESIGN ENGINEERING translates the customer’s quality requirements into operating
characteristics, exact specifications, and appropriate tolerances for a new product or
service or the revision of an established product.
 PROCUREMENT has the responsibility for procuring quality materials and components
and establishing a long-term relationship.
 PROCESS DESIGN has the responsibility for developing processes and procedures that
will produce a quality product or service
 PRODUCTION has the responsibility to produce a quality product or service.
 INSPECTION AND TEST has the responsibility to appraise the quality of purchased and
produced items and to report the results.
 PACKAGING AND STORAGE has the responsibility to preserve and protect the quality
of the product or service.
 SERVICE has the responsibility to provide the customer with the means for fully
realizing the intended function of the product or service during its expected life.
 CUSTOMER specifies the requirements and all the specifications on what the product
should be.

QUALITY ASSURANCE OR QUALITY CONTROL does not have direct responsibility for quality.
It assists or supports the other areas as they carry out their quality control responsibilities

 2. COST OF QUALITY
CATEGORY DESCRIPTION EXAMPLES
Internal Failure Costs Costs related to defective products Rework costs, problem solving, materials
discovered during production or services before they are delivered and product losses, scrap and downtime
to customers
External Failure Costs Costs related to delivering Returned goods, reworking costs,
discovered after delivery to substandard products or services to warranty costs, loss of goodwill, liability
the customer customers claims, and penalties
Appraisal Costs Costs related to measuring, Inspection equipment, testing labs,
cost of activities designed to evaluating and auditing materials, inspectors and the interruption of
ensure quality or uncover parts, products, and services to asses production to take samples
defects. conformance with quality standards
Prevention Costs Costs related to reducing the Quality improvement programs, training,
costs of preventing defect potential for quality problems monitoring and analysis and design costs
from occurring
 3. TOOLS OF TQM - Generating Ideas, Organizing Data and Identifying Problems

o TQM - a philosophy that involves everyone in an organization in a continual effort to

improve quality and achieve and exceed customer satisfaction

 PARETO ANALYSIS – technique for classifying problem areas according to degree of

importance and focusing on the most important. Type of chart that contains both bars
and a line graph, where individual values are represented in descending order by bars
and the cumulative total is represented by the line

 CAUSE & EFFECT DIAGRAM – A fishbone diagram or aka ISHIKAWA diagram, is a

visualization tool categorizing the potential cause of a problem in order to identify its
root causes.

 HISTOGRAMS – a chart of an empirical frequency distribution. A type of graph that is

widely used in mathematics, especially in statistics.

 CHECK SHEETS – a tool for recording and organizing data in real time at the location
where the data is gathered to identify a problem. Data could be quantitative or
qualitative. If the info is quantitative it is called tally sheet.

 SCATTER DIAGRAM – a graph that shows the degree and direction of relationship
between 2 variables

 CONTROL CHARTS – a statistical chart of time-ordered values of sample statistics aka

SHEWHART CHARTS or process behavior chars, used to determine if a manufacturing
or business process is in control.

 QUALITY FUNCTION AND DEPLOYEMENT – is a structured approach to defining

customer needs or requirements and translating them into specific plans to produce
products and meet those needs. “the voice of the customer”

 BENCHMARKING – is a process of measuring the performance of a company’s products,

services or process against those of another business considered to be the best in the
industry. This is also comparing ones business processes and performance or best
practices from other companies.

 JIT MANUFACTURING - refer to a production system in which both the movement of

goods during production and deliveries from suppliers are carefully timed so that at
each step of the process the next (usually small) batch arrives for processing just as the
preceding batch is completed – thus the name, just-in-time.
 4. DEMING'S SEVEN DEADLY DISEASES
Dr. William Edwards Deming compiled a famous list of 14 points he believed were the prescriptions
needed to achieve quality in an organization. His message is that the cause of inefficiency and poor
quality is the system, not the employees. Management’s responsibility is to correct the system to achieve
the desired results. The key elements of Deming’s 14 points are constancy of purpose, continual
improvements and profound knowledge. Profound knowledge involves (1) an appreciation for a system,
(2) a theory variation, (3) a theory of knowledge and (4) psychology. Deming’s concept of profound
knowledge incorporates the beliefs and values about learning that guided Japan’s rise to a world
economic power. Appreciation for the system is the starting point, and it refers to everyone in the
organization working to achieve optimization. Towards that end, management must eliminate internal
competition. Reducing variation is an important key to quality improvement.

 LACK OF CONSTANCY OF PURPOSE to plan product and service that will have a market and keep the
company in business, and provide jobs. As long as the focus is on short term thinking, management will
fail to plan adequately. Without good long term planning, worker efforts will be irrelevant: Total Quality
Management (TQM) cannot be a fad, as long-term forward progress should always be the ultimate goal
for any organization.

 EMPHASIS ON SHORT-TERM PROFITS - Short-term thinking - the opposite of constancy of purpose - in

order to stay in business, fed by fear of the push from bankers and owners for dividends. Boosting short-
term profits is easier, at it typically involves the cutting of any expense related to the long term: training,
quality assurance management, maintenance, etc.

 PERSONAL REVIEW SYSTEMS, OR EVALUATION OF PERFORMANCE, MERIT RATING, ANNUAL REVIEW,

etc. for people in management, the effects of which are devastating. Management by objective, on a go /
no-go basis, without a method for accomplishment of the objective, is the same thing as management by
fear. The essential problem with merit systems is that they reward results rather than process
improvement-results will almost always have a lot of system luck mixed in. Some managers want to
reward people who cooperate more or who seem to have better attitudes, and will insist that they can
recognize the people who are most cooperative and have the highest work ethic. Instead, managers
should understand that the best way to develop cooperation is by focusing on the nature of work
environment, not monetary rewards.

 MOBILITY OF MANAGEMENT: JOB-HOPPING - The simplest and yet one of the most deadly of quality
systems management diseases, management mobility (or when top management changes organizations
every 3-4 years) means continuous improvement efforts will be broken and disjointed as new leaders
come on board. With changes in leadership, there is a change in management philosophy. Managers who
have an eye on the next promotion want results - now - to gain the next rung on the ladder.

 USE OF VISIBLE FIGURES ONLY FOR MANAGEMENT, with little or no consideration of figures that are
unknown or unknowable. Some facts are simply unknowable. Knowing this, Deming insisted that
leaders must still make decisions and manage a situation. This leads to a basic dilemma-how do you
know what would have happened if you had kept on your prior course?

 EXCESSIVE MEDICAL COSTS. For the economy as a whole, health care as a percentage of overall
expenditures has steadily risen for decades, which gradually pushes numerous businesses into a state
of crisis. Potentially the only remedy for this disease would be a political system attempting to reform
health care.

 EXCESSIVE COSTS OF LIABILITY.W. Edwards Deming blamed America's lawyers in part for the
problems of American business. The US has more lawyers per capita than any other country in the world,
and they spend much of their professional time finding people to sue. Like health care costs in No. 6,
Deming believed the remedy to this disease will probably have to come from the government.
  Deming’s 14 points for Management - As a management consultant, William Edwards Deming is
known for the so-called PDCA (Plan-Do-Check-Act) Circle. Herein he emphasizes the importance of
continuous improvement within an organization, as opposed to making changes after the fact.

Deming’s 14 points for Management were first presented in his book Out of the Crisis. With the 14 important
management principles he offered a way to drastically improve a company’s effectiveness. Many of these management
principles are philosophical in nature, and some are more programmatic.

All Deming’s 14 points for Management can bring about transformation.

- Create constancy of purpose Strive for constant improvement in products and services, with the aim of
becoming competitive and ensuring consistency in the way business is done, which will ensure retention of
employment. Do not just make adjustments at the end of the production process, but evaluate if
improvements are necessary during the process and get started immediately.
- The new philosophy A new (economic) time offers new chances and challenges, and management must take
responsibility for being open to such changes. Without change, a company cannot sustain itself in a time when
innovation occurs every day.
- Cease dependence on inspection End the dependence on inspections and final checks to ensure quality. It
is better to that quality checks take place during the process so that improvements can be made earlier. This
section links back to the first point, which promotes the importance of interim improvements.
- End ‘lowest tender’ contract Move towards a single supplier for any one item. Stop doing business and
negotiate with suppliers based on the lowest price. It is worthwhile in the long term to build a good and long-
standing relationship with suppliers, which fosters trust and increases loyalty. An organization should be able
to rely on their suppliers; they supply the parts for the production line and are the first link to a high quality
product.
- Continually seek out problems Improve constantly and forever. Continuous process improvement of
production and service results in improved quality and productivity, which in turn leads to cost reduction.
This part also relates to the first and third points. Improved quality leads to less waste of other raw materials,
which subsequently has a cost-effective effect.
- Institute training on the job Training and development of employees is necessary for the survival of an
organization. By integrating it into the organization, it will be considered as normal for the employees, as part
of their Personal Development Plan.
- Institute supervision Adopt and institute leadership. Leadership needs to be stimulated. By leading and
supervising, managers are able to help employees and make machines work better. Their helicopter view
ensures that they can see everything that happens on the workplace. They will also have to delegate more
tasks so that they can fully focus on the big picture.
- Drive out fear. Fear is paralyzing. Therefore, fear must be eliminated on the work floor so that everyone can
work effectively for the company, feel safe and take risks. Transparent communication, motivation, respect
and interest in each other and each other’s work can contribute to this.
- Break down barriers By eliminating the boundaries between departments, cooperation can be better and
different expert teams will understand each other better. This can be done by, for example, the creation of
multifunctional teams, each with an equal share and open to each other’s ideas.
- Eliminate exhortations Remove ‘stimulating’ slogans from the workplace. Such slogans, warnings and
exhortations are perceived as being patronizing. Quality and production problems do not arise from the
individual employee, but from the system itself.
- Eliminate targets No more focus on achieving certain margins; that impedes professionals from performing
their work well and taking the necessary time for it. Rushing through the work can cause production errors.
Managers should therefore focus on quality rather than quantity.
- Permit pride of workmanship Let employees be proud of their craftsmanship and expertise again. This
relates back to the eleventh point. Employees feel more satisfaction when they get a chance to execute their
work well and professionally, without feeling the pressure of deadlines.
- Institute education Integrate and promote training, self-development and improvement for each employee.
This directly connects to the sixth point. By encouraging employees to work for themselves and to see their
studies and training as a self-evident part of their jobs, they are able to elevate themselves to a higher level.
- The transformation is everyone’s job Transformation is the work of everyone. Set forth concrete actions
to implement and realize transformation and change throughout the organization.
 5. FRANK AND LILIAN GILBRETH CONTRIBUTION TO QUALITY MANAGEMENT /
ACTUAL APPLICATIONS

o Frank (1868-1924) An Engineer pioneered Scientific Methods of Bricklaying

o Lillia(1878-1972) An Engineer and Industrial Psychologist.

o Frank married Lillian when he was 36, after he had done much of his time-and-motion work and years after
he had set up his own engineering consulting business.

o Motion study is a systematic way of determining the best method of doing the work by scrutinizing the
motions made by the worker or the machine. As per Gilbreath it is the science of eliminating the wastefulness
due to unnecessary motions.

o Time study is a structured process of directly observing and measuring human work using a timing device
to establish the time required for completion of the work by a qualified worker when working at a defined
level of performance.

o The goal is to determine and study work efficiency, effects of workers efficiency efforts and fatigues,
performance at work under stressful conditions.

o According to the Gilbreaths, efficiency could therefore be improved by finding this “ONE BEST WAY” to do
any task. They used new technologies such as film to breakdown motions down into incremental parts, which
they called “therbligs”. By reducing the number of “therbligs” for any task, it could increase the efficiency of
the worker.

o Therbligs are 18 kinds of elemental motions used in the study of motion economy in the workplace. A
workplace task is analyzed by recording each of the therblig units for a process, with the results used for
optimization of manual labour by eliminating unneeded movements.

 6. COMPONENTS OF WASTE / ACTUAL APPLICATIONS - “Something that adds no Value.”

Waste elimination is one of the most effective ways to increase the profitability of any business. Processes
either add value or waste to the production of a good or service. The seven wastes originated in Japan, where
waste is known as “muda." "The seven wastes" is a tool to further categorize “muda” and was originally
developed by Toyota’s Chief Engineer Taiichi Ohno as the core of the Toyota Production System, also known
as Lean Manufacturing. To eliminate waste, it is important to understand exactly what waste is and where it
exists. While products significantly differ between factories, the typical wastes found in manufacturing
environments are quite similar. For each waste, there is a strategy to reduce or eliminate its effect on a
company, thereby improving overall performance and quality.

 WORMPIT;

1. Waiting - requires space, adds no value

2. Over Production – involves excessive use of manufacturing resources
3. Rejects defects – requires reworks costs and possible sales loss due to customer dissatisfaction
4. Motion – indicates poor layout and material movement patterns, increases work-in-process inventory
5. Processing - makes unnecessary production steps, scrap
6. Inventory – causes idle resources, hides quality problems and production inefficiencies
7. Transport - increases handling, increases work-in-process inventory
o WAITING - Whenever goods are not moving or being processed, the waste of waiting occurs. Typically
more than 99% of a product's life in traditional batch-and-queue manufacture will be spent waiting to be
processed. Much of a product’s lead time is tied up in waiting for the next operation; this is usually
because material flow is poor, production runs are too long, and distances between work centers are too
great. Goldratt (Theory of Constraints) has stated many times that one hour lost in a bottleneck process
is one hour lost to the entire factory’s output, which can never be recovered. Linking processes together
so that one feeds directly into the next can dramatically reduce waiting.

o OVERPRODUCTION - Simply put, overproduction is to manufacture an item before it is actually required.

Overproduction is highly costly to a manufacturing plant because it prohibits the smooth flow of
materials and actually degrades quality and productivity. The Toyota Production System is also referred
to as “Just in Time” (JIT) because every item is made just as it is needed. Overproduction manufacturing
is referred to as “Just in Case.” This creates excessive lead times, results in high storage costs, and makes
it difficult to detect defects. The simple solution to overproduction is turning off the tap; this requires a
lot of courage because the problems that overproduction is hiding will be revealed. The concept is to
schedule and produce only what can be immediately sold/shipped and improve machine
changeover/set-up capability

o REJECTS/REWORK - Having a direct impact to the bottom line, quality defects resulting in rework or
scrap are a tremendous cost to organizations. Associated costs include quarantining inventory, re-
inspecting, rescheduling, and capacity loss. In many organizations the total cost of defects is often a
significant percentage of total manufacturing cost. Through employee involvement and Continuous
Process Improvement (CPI), there is a huge opportunity to reduce defects at many facilities.

o (UNNECESSARY/EXCESS) MOTION - This waste is related to ergonomics and is seen in all instances of
bending, stretching, walking, lifting, and reaching. These are also health and safety issues, which in
today’s litigious society are becoming more of a problem for organizations. Jobs with excessive motion
should be analyzed and redesigned for improvement with the involvement of plant personnel.

o (INAPPROPRIATE) PROCESSING - Often termed as “using a sledgehammer to crack a nut,” many

organizations use expensive high precision equipment where simpler tools would be sufficient. This often
results in poor plant layout because preceding or subsequent operations are located far apart. In addition
they encourage high asset utilization (over-production with minimal changeovers) in order to recover
the high cost of this equipment. Toyota is famous for their use of low-cost automation, combined with
immaculately maintained, often older machines. Investing in smaller, more flexible equipment where
possible; creating manufacturing cells; and combining steps will greatly reduce the waste of
inappropriate processing.

o (UNNECESSARY) INVENTORY - Work in Progress (WIP) is a direct result of overproduction and waiting.
Excess inventory tends to hide problems on the plant floor, which must be identified and resolved in
order to improve operating performance. Excess inventory increases lead times, consumes productive
floor space, delays the identification of problems, and inhibits communication. By achieving a seamless
flow between work centers, many manufacturers have been able to improve customer service and slash
inventories and their associated costs.

o TRANSPORTING - Transporting product between processes is a cost incursion which adds no value to
the product. Excessive movement and handling cause damage and are an opportunity for quality to
deteriorate. Material handlers must be used to transport the materials, resulting in another
organizational cost that adds no customer value. Transportation can be difficult to reduce due to the
perceived costs of moving equipment and processes closer together. Furthermore, it is often hard to
determine which processes should be next to each other. Mapping product flows can make this easier to
visualize.
  7. 5S AND VISUAL MANAGEMENT

 5-Step technique towards system and order, and is based on the original Japanese terms that begin with “S”.
 The 5S philosophy focuses on effective workplace organization and standardized work procedures.
 Create a robust foundation for future work in the quality arena
 Abnormal situations are immediately visible and therefore 5S creates the discipline to maintain things as
defined.

 Seiri / Sort: Identify all items needed in the workplace and then clear and remove any unnecessary ones.
 Seiton / Straighten: Organize the necessary items in the workplace by utilizing visual tools such as labels,
color coding, etc.
 Seiso / Shine: Clean and sweep the workplace.
 Seiketsu / Standardize: Standardize the first 3 steps and make sure that all team members are trained in how
to perform these steps with consistency.
 Shitsuke / Sustain: Share information about the implemented 5S projects with all the team members of the
organization and set up a monitoring system to observe the maintenance of the organized and standardized
workplace.

In simple terms, the five S methodology helps a workplace remove items that are no longer needed (sort),
organize the items to optimize efficiency and flow (straighten), clean the area in order to more easily identify
problems (shine), implement color coding and labels to stay consistent with other areas (standardize) and
develop behaviors that keep the workplace organized over the long term (sustain).

 8. Pareto Diagram calculation

A Pareto Diagram / Chart is based on the Pareto Principle postulated by Vilfredo Pareto in the 19 th century. Pareto
was an economist who claimed that the large percentage of wealth is owned by a relatively small percentage of
the population
A type of graph which combines both a bar graph to represent the factors affecting the variable. While the bars
represent the individual factors in decreasing order the line represents

WHEN TO USE A PARETO CHART

 When analyzing data about the frequency of problems or causes in a process.

 When there are many problems or causes and you want to focus on the most significant.
 When analyzing broad causes by looking at their specific components.
 When communicating with others about your data.

The most benefit of using Pareto diagram analysis is that it helps to highlight the important factors in a scenario
where there is a large number of factors to be considered.

Eight easy steps to creating a Pareto chart A Pareto chart provides facts needed for setting priorities. It
organizes and displays information to show the relative importance of various problems or causes of problems.
It is a form of a vertical bar chart that puts items in order (from the highest to the lowest) relative to some
measurable effect of interest: frequency, cost or time.
The chart is based on the Pareto principle, which states that when several factors affect a situation, a few factors will
account for most of the impact. The Pareto principle describes a phenomenon in which 80 percent of variation
observed in everyday processes can be explained by a mere 20 percent of the causes of that variation.
Step 1 Develop a list of problems, items or causes to be compared.
Step 2 Develop a standard measure for comparing the items.
How often it occurs: frequency (e.g., utilization, complications, errors)
How long it takes: time
How many resources it uses: cost
Step 3 Choose a timeframe for collecting the data.
Step 4 Tally, for each item, how often it occurred (or cost or total time it took). Then, add these amounts to
determine the grand total for all items. Find the percent of each item in the grand total by taking the sum of the item,
dividing it by the grand total and multiplying by 100.
Step 5 List the items being compared in decreasing order of the measure of comparison: e.g., the most frequent to
the least frequent. The cumulative percent for an item is the sum of that item’s percent of the total and that of all the
other items that come before it in the ordering by rank.
Step 6 List the items on the horizontal axis of a graph from highest to lowest. Label the left vertical axis with the
numbers (frequency, time or cost), then label the right vertical axis with the cumulative percentages (the cumulative
total should equal 100 percent). Draw in the bars for each item.
Step 7 Draw a line graph of the cumulative percentages. The first point on the line graph should line up with the top
of the first bar. Excel offers simple charting tools you can use to make your graphs, or you can do them with paper
and pencil.
Step 8
Analyze the diagram by identifying those items that appear to account for most of the difficulty. Do this by looking
for a clear breakpoint in the line graph, where it starts to level off quickly. If there is not a breakpoint, identify those
items that account for 50 percent or more of the effect. If there appears to be no pattern (the bars are essentially all
of the same height), think of some factors that may affect the outcome, such as day of week, shift, age group of
patients, home village. Then, subdivide the data and draw separate Pareto charts for each subgroup to see if a
pattern emerges.

 9. ISO concepts (International Organization for Standardization)

ISO 9000 family of quality management systems standards is –
 designed to help organizations ensure that they meet the needs of customers and other stakeholders,
 while meeting statutory and regulatory requirements related to a product or service.
 ISO 9000 deals with the fundamentals of quality management systems, including the seven quality
management principles upon which the family of standards is based.
 ISO 9001 deals with the requirements that organizations wishing to meet the standard must fulfill.

ISO 14000 is a family of standards related to environmental management that exists to help organizations
(a) minimize how their operations (processes, etc.) negatively affect the environment (i.e. cause adverse changes
to air, water, or land);
(b) comply with applicable laws, regulations, and other environmentally oriented requirements; and,
(c) continually improve in the above.
 ISO 14000 is similar to ISO 9000 quality management in that both pertain to the process of how a product is
produced, rather than to the product itself.
 As with ISO 9001, certification is performed by third-party organizations rather than being awarded by ISO
directly.
 The ISO 19011 and ISO 17021 audit standards apply when audits are being performed.

OHSAS 18001
 ISO 45001, which is based in part on OHSAS 18001, was published in March 2018 and is anticipated by the
International Organization for Standardization to replace OHSAS 18001 over three years.
BS ISO 45001 was adopted as a replacement for BS OHSAS 18001 in the United Kingdom in March 2018.

 10. SAMELCO II Coop Inc related quality issues / resolutions