Department of Management (WCU)

UNIT FIVE
Quality Management and Control
5.1. Meaning and Nature of quality
What is Quality?

The American Society for Quality (ASQ) defines quality as “a subjective term for which
eachperson has his or her own definition. In technical usage, quality can have two meanings: (1)
Thecharacteristics of a product or service that bear on its ability to satisfy stated or implied needs
and(2) A product or service free of deficiencies.” Obviously, quality can be defined in many
ways,depending on who is defining it and the product or service it refers to.

Quality from the Customer’s Perspective

Quality should be aimed at the needs of the consumer, present and future. From this perspective,
product and service quality is determined by what the customer wants and is willing to pay for.
Since customers have different product needs, they will have different quality expectations. This
results in a commonly used definition of quality as a service‘s or product‘sfitness for its
intendeduse, or fitness for use; how well does it do what the customer or user thinks it is
supposed to do and wants it to do?
Define quality as a service’s or product’s fitness for its intended use, or fitnessfor use; how well
does it do what the customer or user thinks it is supposed to do and wants it to do?

The Dimensions of Quality

It is obvious that from a customer perspective quality doesn't pertain to a single a single aspect of
a product or service, but to a number of different dimensions of the product or service. Although
they may vary somewhat from product to product, or between product and service, the
dimensions of quality include:

1. Performance: The basic operating characteristics of a product; for example, how well a
carhandles or its gas mileage.
2. Aesthetics: appearance, feel, smell, taste.
3. Features: The “extra” items added to the basic features of a product
4. Reliability: The probability that a product will operate properly within an expected time.
5. Conformance: The degree to which a product meets pre-established standards.

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6. Durability: How long the product lasts; its life span before replacement.
7. Serviceability: The ease of getting repairs, the speed of repairs, and the courtesy
andcompetence of the repair person.
8. Safety: Assurance that the customer will not suffer injury or harm from a product;
anespecially important consideration for automobiles.
9. Perceived quality: indirect evaluation of quality

Quality from the Producer’s Perspective

Product or service design results indesign specifications that should achieve the desired quality.
However, once the product design hasbeen determined, the producer perceives quality to be how
effectively the production process is ableto conform to the specifications required by the design
referred to as the quality of conformance. Whatthis means is quality during production focuses
on making sure that the product meets the specificationsrequired by the design.

A Final Perspective on Quality

We approached quality from two perspectives, the customer’s and the producer’s. These
twoperspectives are dependent on each other as shown in Figure 2.1. Although product design
iscustomer-motivated, it cannot be achieved without the coordination and participation of
theproduction process. When a product or service is designed without considering how it will
beproduced, it may be impossible for the production process to meet design specifications or it
maybe so costly to do so that the product or service must be priced prohibitively high.

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Figure 2.1:The Meaning of Quality

The above figure depicts the meaning of quality from the producer’s and consumer’s
perspectives.
The final determination of quality is fitness for use, which is the customer’s view of quality. It is
the consumer who makes the final judgment regarding quality, and so it is the customer’s view
that must dominate.

Total Quality Management (TQM)

Although it has taken on many meanings, it was (and stillis) a philosophy for managing an
organization centered on quality and customer satisfaction as “the”strategy for achieving long-
term success. It requires the active involvement, participation and cooperationof everyone in the
organization, and encompasses virtually all of its activities and processes.

To achieve and sustain this pervasive focus on quality requires a significant long-term
commitmenton the part of the organization’s leadership.

Continuous Improvement

Represents continual improvement of process & customer satisfaction, involves all operations
& work units. Other namesKaizen (Japanese), Zero-defects

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Approachesthat can help companies with continuous improvement:the plan–do–study–act

(PDSA) cycle, benchmarking and the quality circles.

A. Plan –Do-Study-Act (PDSA) Cycle

The plan–do–study–act (PDSA) cycle describesthe activities a company needs to perform in

order to incorporate continuous improvementin its operation.

Figure: PDSA Cycle

B. Benchmarking

Benchmarking:Another way companies implement continuous improvement is bystudying

business practices of companies considered “best in class.” This is calledbenchmarking. The
ability to learn and study how others do things is an importantpart of continuous improvement.
C. Quality Circles
A quality circleis a small, voluntary group of employees and theirsupervisor(s).Group of
employees from same work area meet regularly to solve quality-related problems. Facilitator
trains & helps with meetings

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The supervisor is typically the circle moderator, promoting group discussion but notdirecting the
group or making decisions; decisions result from group consensus. Quality circles follow an
established procedure for identifying, analyzing,and solving quality-related (or other) problems.

The Cost of Quality

The costs of quality are those incurred to achieve good qualityand to satisfy the customer, as well
as costs incurred when quality fails to satisfy the customer.

Thus, quality costs fall into two categories: the cost of achieving good quality, also known as
thecost of quality assurance, and the cost associated with poor-quality products, also referred to
asthe cost of not conformingto specifications.

A. The Cost of Achieving Good Quality

The costs of a quality management program are prevention costsand appraisal costs.
Prevention costs: relates to attempts to prevent defects from occurring. They include costs such
as planning and administration systems, working with suppliers, training, quality control
procedures, design costs to decrease the probability of defective workmanship.
Appraisal costs-costs relate to inspection, testing and other activities intended to uncover
defective products, or to assure that there is no defectives. They include the cost of inspectors,
testing, test equipments, and filed-testing.

B. The Cost of Poor Quality

The cost of poor quality (COPQ) is the difference between what it actually costs to produce
aproduct or deliver a service and what it would cost if there were no defects.
Failure costs: costs that are incurred by defective parts or products, or faulty services.
The cost of poor quality can be categorized as internal failure costs or external failure costs.

Internal failure costs are incurred when poor-quality products are discovered before they
aredelivered to the customer.
The costs of internal failures include lost production time, scrap, rework, investigation costs,
possible equipment damage, and possible employee injury.

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External failure costs:are incurred after the customer has received a poor-quality product and
areprimarily related to customer service.
The costs of external failures include warranty claims, handling of complaints, replacements,
liability-the litigation costs resulting from product liability and customer injury, and loss of
customer good will.

Quality Control (QC)

Quality Control (QC) may be defined as a system that is used to maintain a desired level of
quality in a product or service.

It is a systematic control of various factors that affect the quality of the product.

It depends on materials, tools, machines, type of labor, working conditions etc.

The broad areas of application of quality control are incoming material control, process control
and product control.

Quality control assures that processes are performing in an acceptable manner using statistical
technique.

Statistical Process Control

Quality control efforts that occur during production are referred to as statistical process control.

Statistical Process Control(SPC):is a tool for managing processes.

SPC involves comparing the output of a process or a service with a standard and taking remedial
actions in case of a discrepancy between the two.

It also involves determining whether a process can produce a product that meets desired
specification or requirements.

On-line SPC means that information is gathered about the product, process, or service while it is
functional. The corrective action is taken in that operational phase.

This is real-time basis.

Acceptance sampling

It is form of inspection that is applied to lots or batches of items either before or after a process.
Acceptance sampling deter mines whether a batch of goods should be accepted or rejected.

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Although this information is helpful in making the quality acceptance decision after the product
has been produced, it does not help us identify and catch a quality problem during the production
process.

Quality Measures: Variablesand Attributes

Variables

A control chart for variables is used to monitor characteristics that can be measured and have a
continuum of values, such as height, weight, or volume.

Eg. Height, weight, or Volume

Attributes

A control chart for attributes is used to monitor characteristics that have discrete values and can
be counted. Often they can be evaluated with a simple yes or no decision. Eg. Color, taste, or
smell.

The quality of a product or service can be evaluated using either an attribute of the product or
serviceor a variable measure. An attributeis a product characteristic such as color, surface
texture,cleanliness, or perhaps smell or taste. Attributes can be evaluated quickly with a discrete
responsesuch as good or bad, acceptable or not, or yes or no. Even if quality specifications are
complexand extensive, a simple attribute test might be used to determine whether or not a
product orservice is defective. For example, an operator might test a light bulb by simply turning
it on andseeing if it lights. If it does not, it can be examined to find out the exact technical cause
for failure,but for SPC purposes, the fact that it is defective has been determined.

A variable measure is a product characteristic that is measured on a continuous scale such

aslength, weight, temperature, or time. For example, the amount of liquid detergent in a plastic
containercan be measured to see if it conforms to the company’s product specifications.
Process Control Chart
It is a graph that shows whether a sample of data falls within the common or normal range of
variation.They are used to monitor and control process on an ongoing basis.
They help to detect variations outside the normal operational limits, and to identify the cause of
variations.

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Control Charts

Figure 3.1: Process ControlChart

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Figure 3.2:TheNormalDistribution

Control Charts for Attributes

The quality measures used in attribute control chartsare discrete values reflecting a simple
decision criterion such as good or bad. A p-chart uses the proportion of defective items in a
sample as the sample statistic; a c-chart uses the actual number of defects per item in a sample.
A p-chart can be used when it is possible to distinguish between defective and non-defective
items and to state the number of defectives as a percentage of the whole.

P-CHART

With a p-chart a sample of n items is taken periodically from the production or service process,
and the proportion of defective items in the sample is determined to see if the proportion falls
within the control limits on the chart. Although a p-chart employs a discrete attribute measure
(i.e., number of defective items) and thus is not continuous, it is assumed that as the sample size
(n) gets larger, the normal distribution can be used to approximate the distribution of the
proportion defective. This enables us to use the following formulas based on the normal
distribution to compute the upper control limit (UCL) and lower control limit (LCL) of a p-chart:

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Example 3.1:Constructionof a p-Chart

The Western Jeans Company produces denim jeans. The company wants to establish a p-chart to
monitor the production process and maintain high quality.

Western believes that approximately 99.74% of the variability in the production process
(corresponding to 3-sigma limits, or z = 3.00) is random and thus should be within control limits,
whereas 0.26% of the process variability is not random and suggests that the process is out of
control.

The company has taken 20 samples (one per day for 20 days), each containing 100 pairs of jeans
(n =100), and inspected them for defects, the results of which are as follows. The proportion
defective for the population is not known. The company wants to construct a p-chart to
determine when the production process might be out of control.

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C-CHART

A c-chart is used when it is not possible to compute a proportion defective and the actual number
of defects must be used. For example, when automobiles are inspected, the number of blemishes
(i.e., defects) in the paint job can be counted for each car, but a proportion cannot be computed,
since the total number of possible blemishes is not known. In this case a single car is the sample.

Since the number of defects per sample is assumed to derive from some extremely large
population, the probability of a single defect is very small. As with the p-chart, the normal
distribution can be used to approximate the distribution of defects. The process average for the c-
chart is the mean number of defects per item, , computed by dividing the total number of defects
by the number of samples. The sample standard deviation δ Č, is Č. The following formulas for
the control limits are used:

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Example 3.2 Constructionof a c-Chart

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