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CHAPTER 4. QUALITY
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CHAPTER 4. QUALITY

• 1. Quality system
• 2. Quality control
• 3. Quality assurance
• 4. Total quality management
• 5. Managing and monitoring quality
• 6. Cost of quality
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1. Quality systems

1.1. Why quality is important in a business

environment?
1.2. What is quality?
1.3. Quality systems
1.4. Quality standard
1.5. The quality of hierarchy
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1.1. Why quality is important in a
business environment?
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1.2. what is quality?
• Few consumers could define quality if asked, all know it when
they see it. That makes the critical point that quality is the eye
of the beholder.

Perceived quality is a major factor by which people make

distinctions in the marketplace. Whether we articulate (express)
them openly or keep them in the back of our minds, we all apply a
number of criteria when making a purchase. The extent to which a
purchase meets these criteria determines its quality in our eyes.
 1.2. what is quality?


Applying criteria

Example 1:
Would you want
her to be your girlfriend?


 1.2. what is quality?


Applying criteria

Example 2:
Would you want
him to be your boyfriend?


1.2. what is quality?

 
Applying Criteria
Quality as Consumer-Driven Concept

How will you judge the quality

of the restaurant?


 
 
Applying Criteria
Quality as Consumer-Driven Concept

How will you judge the quality of the restaurant? Most people apply
such criteria as following:
• Service
• Response time

• Food preparation
• Environment/atmosphere
• Price
• Selection

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 

Quality Encompasses both Substance and Image
Perry L.Johnson

“Quality encompasses every aspect of

your firm and is actually
an emotional experience for the customer. Customers want to

feel good about their purchases, to feel that they have gotten
the best value. They want to know their money has been well

spent, and they take pride in their association with a company

with a high quality image”

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 
Product or  only aspect of Quality
Service is not the
Most people associate quality with a product or service. Quality
is
not only products and services but also includes:
 
Process

Enviroment  


People
 

Deming’s point on Quality
Quality has many different criteria and theses criteria change
continually. To complicate matters even further, different
people value the different criteria differently. For this reason,
is
it important to:

- Measure consumer preference

- Remeasure them frequently
 

 


 

Common  of Quality
Elements
These common elements are as follows:

• quality involves meeting or exceeding customer expectations

• quality applies to products, services, people, processes and environments

• quality is an ever-changing state (i.e. what is considered quality today may not be
good
enough to be considered quality tomorrow)

With these common elements extracted, the following definition of quality can be
set
forth:
“Quality is a dynamic state associated with products, services, people,

processes and environments that meets or exceeds expectations”


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1.3. Quality systems
Quality systems include all activities that contribute to
quality, directly or indirectly.

A quality management system (QMS) is the organised structure

of responsibilities activities, resources and events that together
provide procedures and methods of implementation to ensure
the capability of an organization to meet quality requirements
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1.4. The quality standard

• ISO 9000 is intented to establish, document and

maintain a system for ensuring the output quality
of a process. It is the generic term for a series of 5
international standard: 9000, 9001, 9002, 9003,
9004 created to standardize quality management
systems for manufacturing and service industry all
over the world.
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Objective of ISO standard
• Achieve, maintain, and continously improve product quality
• Improve quality of operarion to continually meet customers’
and stakeholders’ needs
• Provide confidence to internal management and other
employees that quality requirements are being fulfilled
• Provide confidence to customers and other stakeholders the
quality requirements are being achieved
• Provide confidence that quality system requirements are
fulfilled
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Structure of ISO 9000 Standards

• 21 elements organized into four majors sections:

– Management responsibility

– Resource management

– Product realization
– Measurement, analysis, and improvement
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ISO 9000:2000 Quality management
principles
• 1. Customer focus
• 2. Leadership
• 3. Involvement of people
• 4. Process Approach
• 5. System approach to Management
• 6. Continual improvement
• 7. Factual Approach to Decision Making
• 8. Mutually Beneficial supplier relationship
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To gain the ISO certificate

• Prepares quality manual which sets out the company’s

policy and procedure on quality assurance
• An assessor will visit and review the facility’s quality
manual to ensure that it meets the standard and audit
firms’ process
• The certificated is issued of approval is given.
• The assessor will implement an audit every year to
oversee change and evolutions of facility’s quality system
to ensure it continues met the requirement standard.
 Quality Management System
Document Requirements:
 The quality management system documentation shall include
 Documented statements of a quality policy and quality objectives.
 Documented procedures and records required by this International
Standard, and
 Documents, including records, determined by the organization to
be necessary to ensure the effective planning, operation and
control of its processes.
 Records established to provide evidence of conformity to
requirements and of the effective operation of the quality
management system shall be controlled.
+ The quality hierarchy
Detection. Inspect product
Finding and fixing Inspection
mistakes Operation techniqures
REACTIVE to make inspection more
Quality control efficient and to reduce
the costs of quality
Plan and systematic actions
Prevention Quality assurance to ensure that products/
Stop problems services conform to
at source; greater company requirement
Design emphasis Total Quality Incorporate Qc/ QA activities
REACTIVE into company- wide system
Management
aimed at satisfying the
customer
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2. Quality control
2.1. Inspection
it is a technique of identifying when
defective items are being produce at and
unacceptable level.
- Receiving inspection for raw materials
and bought out component
- Floor or process inspection
- Final inspection or testing
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Problems of inspection

• Does not add value and need pay for inspection

department (space and salary)
• The production of substandard products wastes raw
materials, machine time and human effort
• Not suitable with JIT technique
+ 2.2. Quality control and quality standards

• Quality control is concern with maintaining

quality standard. There are usually
procedures to check quality of bought- in
materials, work- in progress and finished
good.
– Single out and remove the cause for poor
quality goods before production instead of
waiting for the end results
– The coordination of all activities from the
preparation of specification through the
purchasing and inspection function and right
up to the function fo delivery of the finished
product.
+ Quality Control

• Input includes: work results, Quality Management Plan,

operational definitions, and checklists.
• Methods used include: inspection, control charts, pareto
diagrams, statistical sampling, flowcharting, and trend
analysis.
• Output includes: quality improvements, acceptance
decisions, rework, completed checklists, and process
adjustments.
Go Back
+ 2.3 Quality and inspection
Quality control Quality inspection
Involves setting controls for the It is a technique of identifying when
process of manufacture or service defective items are being produce at
delivery. It is aimed at preventing the an unacceptable level.
manufacture of detective items or the
provision of defective services.

- Establishing Standard of quality for - Receiving inspection for raw

product or service materials and bought out
- Establishing procedure and component
production methods which ought - Floor or process inspection
to ensure that these required - Final inspection or testing
Standard of Quality are met in a
suitably high proportion of cases
- Monitoring actual quality
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3. Quality assurance

• 3.1. Acceptable standard

• 3.2. Supplier quality assurance
• 3.3. Quality assurance of good inwards
• 3.4. Inspection of output
• 3.5. Statistical process control (SPC)
+ 3. Quality assurance
QA is about designing a process of which the end results is
guaranteed to be of an acceptable standard, because of the
checks that have been made along the way.

- Clear policy on quality together with precise and

measurable objectives-> all employee exactly know what
reqruied in term of product quality
- Objective bases on what standard s the market requires

-> market research

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3.2. Supplier quality assurance (SQA)
SQA is the term used where a supplier guarantees the
quality of goods supplied and allows the customer
access while the goods are being manufactured
- Items can be directed straight to production-> can
facilitate JIT production
- The supplier produces to the customer’s
requirement, there by reducing rejects and the cost of
producing substitutes.
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3.5. Statistical process control (SPC)

• Statiscal process control is a method of

monitoring processes and process variation. The
purpose is to identify causes for process
variations and resolve them
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4. Total quality management (TQM)

• TQM is defines as a management approach of an

organization centred on quality, based on the
participation of all its members and aiming at
long- term success. This is achieved through
customer satisfaction and benefits to all members
of the organization and to society.
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A core definition of  (TQM) describes a management
approach to long–term success through customer
satisfaction. In a TQM effort, all members of an
organization participate in improving processes,
products, services, and the culture in which they work.
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The Primary Elements of TQM

Total quality management can be summarized as

a management system for a customer-focused
organization that involves all employees in
continual improvement. It uses strategy, data, and
effective communications to integrate the quality
discipline into the culture and activities of the
organization-
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4.1. TQM Principle

Satisfy the customer

TQM Satisfy the supplier

Continous improvement
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Satisfy the customer
The customer ultimately determines the level of quality.
No matter what an organization does to foster quality
improvement—training employees, integrating quality
into the design process, upgrading computers or
software, or buying new measuring tools—the
customer determines whether the efforts were
worthwhile.
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Satisfy the supplier
• Supplier is the person or organization form whom
you are purchasing goods or services.
• External supplier: Providing them clear
instructions and requirements and them paying
them fairly and ontime
• Internal supplier::
– Proving good task instructions, the tools they need to
do their job and good working conditions; reward the
worker-> make more productivity out of the worker
- Empower worker
 Empower employee

Empowerment is the term given to organizational

arrangements that allow employees more autonomy,
discretion, and unsupervised decision-making
responsibility.

Three levels of empowerment

 Suggestion involvement- basic level: contribute ideas
 Job involvement- higher level: manager support
 High involvement- highest level: staffs involve in the
strategy decision making
Three components of empowerment

Trust

Competence Teamwork
Four ways to breed empowerment:

Enlisting of support from employees

Gaining the “heart and minds” of people

Structural means: a flat org structure

The managers style and behaviour

Leaders, managers, supervisors can empower other by:

 Articulating a clear vision and goals

 Helping them to master challenging
 Modeling the correct behaviors
 Providing support
 Arousing positive emotions
 Providing good information
 Providing necessary resource
 Connecting to outcomes
 Being fair, reliable, open, caring, and competent
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Continual improvement
A major thrust of TQM is continual process
improvement. Continual improvement drives an
organization to be both analytical and creative in
finding ways to become more competitive and more
effective at meeting stakeholder expectations.

Get it more right next time

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Eight stage model for improving quality

1. Find out the problem

2. Select action targets
3. Collect data about the problem
4. Analyze data
5. Identify possible cause
6. Plan improvement action
7. Monitor the effects of the improvement
8. Communicate the results
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4.2.Total Quality Management Benefits

• Strengthened competitive position

• Adaptability to changing or emerging market conditions and to
environmental and other government regulations
• Higher productivity
• Enhanced market image
• Elimination of defects and waste
• Reduced costs and better cost management
• Higher profitability
• Improved customer focus and satisfaction
……to be continued.
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• Increased customer loyalty and retention
• Increased job security
• Improved employee morale
• Enhanced shareholder and stakeholder value
• Improved and innovative processes
• The benefits of total quality management are
endless, helping your organization get results.
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+ 4.3. FIVE STRATEGIES TO DEVELOP THE TQM PROCESS

• Strategy 1: The TQM element approach

• Strategy 2: The guru approach
• Strategy 3: The organization model approach
• Strategy 4: The Japanese total quality approach
• Strategy 5: The award criteria approach
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Strategy 1: The TQM element approach

• The TQM element approach takes key business processes

and/or organizational units and uses the tools of TQM to
foster improvements. This method was widely used in
the early 1980s as companies tried to implement parts of
TQM as they learned them.
• Examples of this approach include quality circles,
statistical process control, Taguchi methods, and quality
function deployment.
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Strategy 2: The guru approach

• The guru approach uses the teachings and writings of one

or more of the leading quality thinkers as a guide against
which to determine where the organization has
deficiencies. Then, the organization makes appropriate
changes to remedy those deficiencies.
• For example, managers might study Deming’s 14 points or
attend the Crosby College. They would then work on
implementing the approach learned.
+ Strategy 3: The organization model approach
• In this approach, individuals or teams visit organizations
that have taken a leadership role in TQM and determine
their processes and reasons for success. They then
integrate these ideas with their own ideas to develop an
organizational model adapted for their specific
organization.
• This method was used widely in the late 1980s and is
exemplified by the initial recipients of the Malcolm
Baldrige National Quality Award.
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Strategy 4: The Japanese total quality approach

• Organizations using the Japanese total quality approach

examine the detailed implementation techniques and
strategies employed by Deming Prize–winning companies
and use this experience to develop a long-range master
plan for in-house use.
• This approach was used by Florida Power and Light—
among others—to implement TQM and to compete for
and win the Deming Prize
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Strategy 5: The award criteria approach

• When using this model, an organization uses the criteria

of a quality award, for example, the Deming Prize, the
European Quality Award, or the Malcolm Baldrige
National Quality Award, to identify areas for
improvement. Under this approach, TQM
implementation focuses on meeting specific award
criteria.
• Although some argue that this is not an appropriate use
of award criteria, some organizations do use this
approach and it can result in improvement.
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4.4. Tools and technique
• Tools
– Flowcharting
– SPC
– Pareto analysis
– Cause and effect diagrams
– Employee and customer survey
• Techniques
- Benchmarking
- Cost of quality
- Quality function deployment
- Failure mode effects analyses
- Design of experiments
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5.5. Quality cycle
• Quality cycle is a group of employees who meet
regularly to discuss problems of quality and
quality control in their area of work, and perhaps
suggest ways of improving it.
• The main aim is to be able to offer management:
– Ideas connected with improvement and
recommendation
– Possible solutions and suggestions
– Organizing the implementation of the ideas and
solutions
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The benefit arising from using quality circles
• Improve quality leading to greater customer satisfaction
• Greater motivation of employee
• Improved productivity
• Sharing management/ customer problems
• A spirit of seeking improvements is generated
• Employee become more aware of oppertunities for
improvement because of training, in areas outside quality
circles
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6. Quality culture
• A quality culture is an organizational value system that
results in an environment that is conductive to the
establishment and continual improvement of quality. It is
consists of values, traditions, procedures, and
expectations that promote quality.
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What a quality culture looks like?
• Widely shared philosophy of management
• Emphasis on the importance of human resources to the
organization
• Ceremonies to celebrate organizational events
• Recognition and rewards for successful employee
• Effective internal network for communicating the culture
• Informal rules of behaviors
• Strong value system
• High standard for performance
• Defined organizational character
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Why need cultural change when
implementing TQM

• Change can not occur in a hostile environment

• Moving to TQ takes time
• It can be difficult to overcome the past
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The law of organization change

• Understand the history behind the current culture

• Don’t tamper with systems, improve them
• Be prepared to listen and observe
• Involve every one affected by change in making fit
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Why people resist the change?

• Fear
• Lost of control
• Uncertainty
• More work
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Implement change- promoting strategy

• Involve potential resisters

• Avoid surprises
• Move slowly at first
• Start small and be flexible
• Create a positive environment
• Incorporate the change
• Provide quite pro quo: require something, give something
• Respond quickly and positively
• Work with establish leaders
• Treat people with dignity and respect
• Be constructive
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Strategy for establishing a quality culture

• Identify the change needed

• Put the planned changes in writing
• Develop a plan for making the change (who, what, when,
where, how model)
• Understand the emotional transition process
• Identify key people and made them advocate s
• Take a hearts and minds approach
• Apply courtship strategy
• Support, support and support
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