HANDOUT #2 in their efforts to meet or exceed

QUALITY MANAGEMENT customer expectations. The dimensions

used for goods are somewhat different
from those used for services.
Introduction: Dimension for Product Quality:
Quality Management
1. Convenience
 examines the primary factors that
2. Reliability
determine the quality of products and 3. Responsiveness
services, as well as the various 4. Time
dimensions of quality, including 5. Assurance
performance, durability, and reliability 6. Courtesy
 also emphasizes the substantial 7. Tangibles
advantages of upholding high-quality 8. Consistency
standards, such as competitive 9. Expectancy
advantage and customer satisfaction
Assessing Service Quality
Introduction to Quality
 People deal with the issue of quality  A widely used tool for assessing service
continually in their daily lives. We quality is SERVQUAL, an instrument
concern ourselves with quality when designed to obtain feedback on an
grocery shopping, eating in a restaurant organization’s ability to provide quality
and making a significant purchase, such service to customers
as an automobile, a home, a television,  The results of this service quality audit
or a personal computer help the management identify service
#EXAMPLE: How will you judge the quality of the strengths and weaknesses
restaurant? Most people apply such criteria as the
following: The Determinants of Quality
 Service
 Response time  The degree to which a product or a
 Food preparation service successfully satisfies its
 Environment or atmosphere intended purpose has four primary
 Price determinants:
 Selection 1. Design.
2. How well the product or service
 The importance of quality cannot be conforms to the design.
overstated; price and quality are two key 3. Ease of use.
elements of every purchasing decision. 4. Service after delivery.
 Quality is defined as the ability of a
product or service to meet or exceed  Design involves decisions about the
customer requirements or expectations specific characteristics of a product or
consistently. Quality is customer- service, such as size, shape, and
dependent location.

Insights on Quality Management  Quality of design refers to the

 is the degree to which the intention of designers to include or
performance of a product or service exclude certain features in a product
meets or exceeds customer or service.
expectations
 The difference between these two,  Quality of conformance refers to the
Performance— Expectations, is of degree to which goods and services
great interest. conform to the designers' intent.
Customer expectations can be broken
down into several categories or
dimensions that customers use to judge
a product's or service's quality. The following are the Responsible for Quality
Understanding these helps organizations (Stakeholders):
  Top Management
 Design Ethical behavior comes into play in many
 Procurement situations that involve quality.
 Quality assurance
 Customer service The following are considered substandard
Benefits of Good Quality work:
- Business organizations with good or  Defective products
excellent quality typically benefit in a  Substandard service
variety of ways:  Poor designs
 an enhanced reputation for  Shoddy workmanship
quality  Substandard parts and materials
 the ability to command premium
prices
 an increased market share Quality Control (QC)
 greater customer loyalty
 lower liability cost - a process through which a business
seeks to maintain or improve product
The Consequences of Poor Quality are the quality.
following: - significant aspect of quality control is the
1. Loss of business. establishment of well-defined controls.
2. Liability. These controls help standardize both
3. Productivity. production and reactions to quality
4. Costs. issues

The Costs of Quality: Understanding Quality Control (QC)

- Refers to any serious attempt to deal - involves testing units and determining if
with quality issues and must consider they are within the specifications for the
the costs associated with quality. final product.
Appraisal costs - related to inspection, testing,
and other activities are intended to uncover How Is Quality Control Done?
defective products or services or to ensure none - Quality testing is generally completed in
each manufacturing or business process
Prevention costs - relate to attempts to prevent step.
defects from occurring. They include costs such as - In a non-manufacturing business, quality
planning and administration systems, working with testing can involve customer service
vendors, training, quality control procedures, and evaluations, questionnaires, surveys,
extra attention in the design and production phases inspections, or audits.
to decrease the probability of defective
workmanship. QC Is Different by Industry

Failure costs are incurred by defective - The quality control used in a business is
parts or products or by faulty services. highly dependent on the product or
- Internal failures are those industry
discovered during the - #EXAMPLE: quality control in food and
production process; drug manufacturing includes ensuring
- External failures are those found after the product does not make a consumer
delivery to the customer sick. The company performs chemical
and microbiological testing of samples
from the production line.
Return on Quality (ROQ). An approach that
evaluates the financial return of investments in Quality Control vs. Quality Assurance
quality. - Quality control focuses on
requirements, such as ensuring a part
Ethics and Quality Management. All members meets specifications. Quality
of an organization must ethically perform their assurance refers to the sum of all
duties. actions and processes needed to
 demonstrate that quality requirements Quality Systems
are fulfilled. - Many organizations use three common
quality systems to manage their quality:
Types of Quality Control Methods total quality management (TQM),
- There are several methods quality ISO9001, and Six Sigma.
control uses to communicate and track
inspections and issues Total Quality Management (TQM)
- When one chart analyzes a specific - Companies must deliver quality goods
product attribute, it is called a univariate and services that satisfy customers'
chart needs to compete today.
- . A chart that measures variances in 1. Customer Satisfaction -
several product attributes is called a Companies committed to TQM
multivariate chart. understand that the purpose of a
business is to generate a profit
X-Bar Chart by satisfying customer needs
- Randomly selected products are tested 2. Employee Involvement –
for the given attributes the chart is Successful TQM requires
tracking. A common form of a quality everyone in the organization, not
control chart is the X-Bar Char simply upper-level management,
- the y-axis on the graph follows the to be committed to satisfying the
degree to which the variance of the customer. When customers wait
tested attribute is acceptable too long at a drive-through
- The x-axis tracks the samples tested. window, it is the responsibility of
- helps you determine if defects are some employees, not the
occurring randomly or systematically. manager alone.
3. Continuous Improvement -
Taguchi Method An integral part of TQM is
- quality control is another approach that continuous improvement: the
emphasizes the roles of research and commitment to constantly
development, product design, and improving the design, production,
product development in reducing the and delivery of goods and
occurrence of defects and failures in services.
products.

100% Inspection Method International Organization for Standardization

- quality control process involving looking (ISO)
at and assessing all product parts. - international standard-setting body
- done to rule out flaws in products comprising representatives from various
- calls for data about the manufacturing standards organizations.
process and software to analyze - Founded on 23 February 1947
inventory. - organization promotes worldwide
proprietary, industrial, and commercial
Examples of Quality Control standards.
- Three examples of quality control could - It is headquartered in Geneva,
be in the food industry; overseeing the Switzerland, and works in 164 countries.
ingredient specifications, reviewing - an independent, non-governmental
supplier lists, and ensuring the facility organization and is the largest developer
where the food product is made is of voluntary international standards.
sanitary. - The use of these standards assists the
organization in creating products and
The Bottom Line services that are safe, reliable, and of
- Quality control within a business helps good quality.
ensure product quality and the overall
success of a business.
Steps in obtaining ISO certification charts, scatter diagrams and cause-and-
effect diagrams.
- A firm must initially begin by
documenting and implementing its Check Sheets
systems for quality management. These - This custom-designed form records the
documents must include policies, number of occurrences of a particular
Procedures, and work instructions. outcome of interest.
- An audit must take place. The - collect basic information such as how
organization must arrange for a many incidents occurred, the timing, or
certification body to complete the audit. the non-conforming measurement.
Many private companies have been
granted (by ISO) the authority to grant Histograms
ISO9000 certification. These private - Raw data from a check sheet
companies are themselves accredited - Continuous data
by ISO. - accurate representation of the
- it is accepted that it will take 12 to 18 distribution of the data.
months to complete this process

Six Sigma Control Charts

- set of techniques and tools for process - appropriate tool to monitor a process's
improvement. Engineer Bill Smith performance over time
while working at Motorola in 1980, - Upper Control limit and a lower Control
introduced it limit
- comes from the term in statistics of
Sigma, meaning standard deviation Pareto Charts
- A special bar chart that shows the
number of occurrences of a particular
Green Belt characteristic ordered from highest to
- indicates that an individual has had Six lowest.
Sigma training - The X-axis represents each
- have a full-time job in the organization characteristic
but will be called upon to assist with - the Y-axis is the number of times this
projects part-time. occurrence was recorded.
Black Belt - helps us focus on the defects that
- full-time position in the Quality area appear the most often and allocate the
where the individual works as a resources accordingly.
coach/leader in projects. These
individuals will have extensive Scatter Diagrams
experience in Six Sigma. - A simple diagram helps determine if
Master Black Belt there is a relationship between two
- full-time position in the Six Sigma team variables.
with extensive project management
experience. They coach and mentor Cause and Effect Diagrams
the Black Belt leaders. - Also known as a Fishbone diagram,
Champion Dr. Ishikawa developed it to help
- senior manager in the organization who identify the causes of a problem. The
oversees the other Six Sigma Quality overall shape is that of a fish.
employees

Tools for Quality Improvement

- In any Quality improvement initiative,
data collection and evaluation are critical
steps. Several basic generic tools are
most commonly used
- These tools include check sheets,
histograms, control charts, Pareto