Session 17

Production & Operations
Management
Session-17
Program: FT MBA Core

Trim: III
Instructor: Dr. Abhinav Sharma
Quality?
The ability of a product or service to consistently meet or exceed customer

expectations
• For a decade or so, quality was an important focal point in business. After a
while, this emphasis began to fade as other concerns took precedence
• There has been a recent resurgence in attention to quality given recent experiences
with the costs and adverse attention associated with highly visible quality failures
Production & Operations Management, Dr. A.K. Sharma, SBM, NMIMS Mumbai 2
Remember:
Working definition of quality is customer-dependent!
Read:
The evolution of quality management (from Stevenson’s book)
Defining Quality: Dimensions of Quality
• Performance – main characteristics of the product
• Aesthetics – appearance, feel, smell, taste
• Special features – extra characteristics
• Conformance – how well the product conforms to design specifications
• Reliability – consistency/dependable of performance
• Durability – the useful life of the product
• Perceived quality – indirect evaluation of quality (e.g. Reputation)
• Serviceability – handling of complaints or repairs
• Consistency – quality doesn’t vary
Defining Quality: Dimensions of Service Quality
• Convenience – the availability and accessibility of the service
• Reliability – ability to perform a service dependably, consistently, and accurately
• Responsiveness – willingness to help customers in unusual situations and to deal
with problems
• Time – the speed with which the service is delivered
• Assurance – knowledge exhibited by personnel and their ability to convey trust
and confidence
• Courtesy – the way customers are treated by employees
• Tangibles – the physical appearance of facilities, equipment, personnel, and
communication materials
• Consistency – the ability to provide the same level of good quality repeatedly
• Expectancy – meet (or exceed) customer expectations
Assessing Service Quality
• Audit service to identify strengths and weaknesses
• In particular, look for discrepancies between:
1. Customer expectations and management perceptions of those expectations
2. Management perceptions customer expectations and service-quality
specifications
3. Service quality and service actually delivered
4. Service actually delivered and what is communicated about the service to
customers
5. Customers’ expectations of the service provider and their perceptions of
provider delivery
Assessing Service Quality
A useful tool for assessing the service quality is SERVQUAL.
Zeithaml, V. A, Parsuraman, A., Berry, L.L. (1990). Delivering quality service:
Balancing customer perceptions and expectations. The Free Press: New York.
Determinants of Quality: Degree to which a product or service successfully satisfied its
intended purpose
• Quality of design
• Intention of designers to include or exclude features in a product or service
• Quality of conformance
• The degree to which goods or services conform to the intent of the designers
• Ease-of-Use and user instructions
• Increase the likelihood that a product will be used for its intended purpose and
in such a way that it will continue to function properly and safely
• After-the-sale service
• Taking care of issues and problems that arise after the sales
Identifying Voice of Customer (VOC) is very
important!
Responsibility for Quality
• Top management
• Design Everyone in the organization has
• Procurement some responsibility for quality,
but certain areas of the
• Production/operations
organization are involved in
• Quality assurance activities that make them key
• Packaging and shipping areas of responsibility.
• Marketing and sales
• Customer service
Benefits of Quality
• Enhanced reputation for quality
• Ability to command premium prices
• Increased market share
• Greater customer loyalty
• Lower liability costs
• Fewer production or service problems
• Lower production costs
• Higher profits
Consequences of Poor Quality
• Loss of business
• Liability
• Productivity
• Costs
Costs of Quality
Foundation of Modern Quality Management: The GURUS
Walter Shewart
(1891-1967)
• “father of statistical quality control”
• Control charts
• Variance reduction
W. Edwards Deming
(1900-1993)
• Special vs. common cause variation
• The 14 points
Deming’s 14 points:
1. Create constancy of purpose toward improvement of product 8. Drive out fear, so that everyone may work effectively
and service. for the company.
2. Reduce levels of delays, mistakes, defective materials, and 9. Break down barriers between departments. People in
defective workmanship. research, design, sales, and production must work as a
3. Cease dependence on mass inspection. (Prevent defects rather team.
than detect defects.) 10. Eliminate goals and slogans asking for new levels of
4. Eliminate suppliers that cannot qualify with statistical productivity without providing methods.
evidence of quality. 11. Eliminate work standards that prescribe numerical
5. Find problems. It is management's job to work continually on quotas.
system improvement. 12. Remove barriers that stand between the hourly
6. Institute modern methods of training on the job. worker and his right to pride of workmanship.
7. Emphasize quality instead of volume alone. Management must 13. Institute a vigorous program of education and
prepare to take immediate action on reports from foremen retraining.
concerning barriers such as inherent defects, machines not 14. Create a structure in top management that will push
maintained, poor tools, and fuzzy operational definitions. every day on the above 13 points.
Joseph Juran
(1904-2008)
• Quality Control Handbook, 1951
• Viewed quality as fitness-for-use
• Quality trilogy– quality planning, quality
control, quality improvement
Armand Feigenbaum
(1920-2014)
• Quality is a “total field”
• The customer defines quality
Philip B. Crosby
(1926-2001)
• Zero defects
• Quality is Free, 1979
Kaoru Ishikawa
(1915-1989)
• Cause-and-effect diagram
• Quality circles
• Recognized the internal customer
Genichi Taguchi
(1924-2012)
• Taguchi Loss Function
Taiichi Ohno and Shigeo Shingo

(1912-1990); (1909-1990)
• Kaizen: Continuous Improvement

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Production & Operations

Program: FT MBA Core

The ability of a product or service to consistently meet or exceed customer

Taiichi Ohno and Shigeo Shingo

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