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Armand Feigenbaum TQM REPORT
Armand Feigenbaum TQM REPORT
Armand Feigenbaum TQM REPORT
The elements of total quality to enable a totally customer focus (internal and external)
2. Quality Costs
- Once exposed his concept of total quality control, Armand developed the quality costs,
necessary to guarantee a quality product that can be offered to the customer.
- These are classified according to their origin and are those related to prevention, revaluation,
and internal and external failures:
Prevention costs
- The costs of prevention are those managed to avoid failures in the production processes, as well
as to avoid that an error can produce higher costs when solving it.
- To measure these production costs, preventive measures are taken through product reviews,
quality reports, improvement projects, among other actions.
Revaluation costs
- They originate by carrying out product measurements, as well as inspection and measurement
of stages ranging from the raw materials to be used, inventory updating and measurement
testing for production.
Internal failure costs
- The costs of internal failures are those that arise during manufacturing, all that average stage in
which the product is involved before going to market.
- These include waste and failure of machinery or the same product, for example.
External failure costs
- They occur once the product has already reached the final consumer, and revolve around price
variations, claims and returns that may arise.
- The first of these steps is the "mandate for quality" and focuses on leadership.
- A good level of quality requires careful planning.
- This step seeks to overcome the traditional approaches to quality, which made their
measurements in relation to failures and failure.
- For Armand, a constant effort must be made to maintain an adequate level of quality.
- The second step corresponds to "old quality tactics", which involve the integration of the
different departments involved in an organization.
- The third step is the "command of the organization"; the mandate as a fundamental piece to
ensure quality, manifested through permanent discipline at all levels of the company.
The “Hidden Plant’ or “Hidden Factory Concept
- Feigenbaum’s concept of the hidden factory was primarily focused on quality, specifically the
waste and costs caused by “bad work”, much of which is “hidden” below the surface of day-to-
day operations. In every factory a certain proportion of its capacity is wasted through not getting
it right the first time.
- Dr. Feigenbaum quoted a figure of up to 40% of the capacity of the plant being wasted. At that
time, this was an unbelievable figure; even today some managers are still to learn that this is a
figure not too far removed from the truth.
Schedule Loss - Time where production could be running – but is not scheduled.
Performance Loss - time where production is running – but not as fast as it should.
Quality Loss - time where production is running – but one or more pieces are not good the
first time through.
The hidden factory represents all of the untapped production potential within your current plant.
- First, calculate your Fully Productive Time by multiplying Good Pieces by Ideal Cycle Time.
Fully Productive Time represents how close you are to perfect production.
Good Pieces are pieces that pass through the manufacturing process the first time without needing any
rework.
Ideal Cycle Time is the theoretically fastest cycle time your process can achieve under optimal
conditions.
- Second, calculate your Hidden Factory by subtracting Fully Productive Time from All Time (24/7).
Hidden Factory is what is left after subtracting Fully Productive Time from All Time.
Schedule Loss
- The largest component of the hidden factory for most one- or two-shift operations.
- Typically addressed with overtime (short-term) or additional staff (long-term) to defer capital
expenditures.
Availability Loss
- The largest component of the hidden factory during scheduled production time for most
companies.
Performance Loss
- This is truly a hidden loss for many companies as it is not nearly as visible as Downtime.
Quality Loss
- Gets a lot of focus because of potential customer impact, but usually has the smallest impact on
the hidden factory.