TOTAL QUALITY MANAGEMENT Delivering products with a level of quality that meets customer requirements is essential to business success.

Indeed, in the fierce competition of todays global markets, the level of quality needs to exceed what customers already expect, and at a competitive price. Although companies all over the world proclaim that quality is their topmost priority, this claim is only partially true. urely, improvements have been made because of increasing quality awareness and I ! standards implementation. "owever, that is not good enough. #e still produce and market for price. #hy$ #e have been conditioned to buy on price considerations. If we investigate a little, it is easy to find that enemy to quality is us. %any of us invest in shares and expect a good return. &orporate managers, Individual investors and institutional investors all are under pressure looking for great returns on their investment in short term, to an extent where quality often takes a second seat to profits. In the software industry, it is not unusual to find a new software launched although bugs are still present and 'beta site testing is not complete. In the food industry, the labels may present misleading information about ingredients and their nutritional value. In sophisticated testing equipment, it is common to find that customers have a tough time fixing the problem and getting help from the company that supplied it. (evertheless, in all industries quality is proclaimed as the only way to true improvement. )he pressure is on everyone to perform, but performance alone will not do it. An organi*ation must produce efficiently and effectively in order to survive. !ne way of survival is through quality. )his quality, however, has to be totally in the minds of employees, corporate management and public at large. #e must as a society try to do our best and as an organi*ation try to be good corporate citi*ens. If that means we have to tell the truth, educate our employees and our stockholders, and focus on long+term survival rather than short term gains, so be it. If we practice quality, then the integrity of everything we do is the primary issue. #e must recogni*e that cutting corners is not the way to practice quality. ,uality is practiced by having a vision, goals, and appropriate tools and action plans. )otal ,uality %anagement is a proven method of managing and continually improving quality. )he successful implementation of its principles in -apanese firms has presented a roadmap for quality all over the world. Achieving this quality will involve the entire company . and often suppliers and customers as well. It requires good management systems and practices throughout the organi*ation, from having a vision of the future of the company to maintaining a safe and healthy workplace. It means having well+trained and motivated employees, standardi*ed work procedures, and effective production control. It means ensuring the quality of incoming supplies, and operating a fast and efficient after+sales service. Above all, it requires the active participation of senior management. In short, every function in the company, and every member of staff can and must support quality, hence the name )otal ,uality %anagement /),%0. What is Quality? Defining quality is not as easy as it seems because different people have different perceptions of what constitutes quality. %any consumers have difficulty defining quality

and cannot pinpoint their quality standard in precise terms. Is %ercedes a good quality car$ #hat about 1%#$ 2urther, the meaning of quality evolved with time. )oday, there is not a single universal definition of quality. ome people view it as 3conformance to specifications3. !thers define it as 4meeting the customer requirements3 . 5et us examine a few common definitions. Conformance to s ecifications measures how well the product or service meets the targets and tolerances determined by its designers. 2or example, the dimensions of a machine part may be specified by its design engineers as6789+7.: mm. )his would mean that the target dimension is 67mm but the dimensions can vary between ;.: to 67.: mm. &onformance to specification is directly measurable, though it may not be directly related to the consumers idea of quality. !itness for use focuses on how well the product performs its intended function or use. 2or example, a %ercedes and a 5androver both meet a fitness for use definition if one considers transportation as the intended function. "owever, if the definition becomes more specific and assumes that the intended use is for transportation on mountain roads, the 5androver has a greater fitness for use. <ou can also see that fitness for use is a user+based definition in that it is intended to meet the needs of a specific user group. "alue for rice ai# is a definition of quality that consumers often use for product or service usefulness. )his is the only definition that combines economics with consumer criteria= it assumes that the definition of quality is price sensitive. 2or example, suppose that you wish to take a travel insurance policy and discover that the same policy is being offered by two different companies with different premium rates. If you take the less expensive policy, you will feel that you have received greater value for the price. Defining quality in manufacturing organi*ations is often different from that of services. %anufacturing organi*ations produce a tangible product that can be seen, touched, and directly measured .2or example, cars, computers and clothes. )herefore, quality definitions in manufacturing usually focus on tangible product features. In contrast to manufacturing, service organi*ations produce a product that is intangible. >sually, the complete product cannot be seen or touched. ?ather, it is experienced. @xamples include quality of health services at a hospital, and quality of education at a university. In a nutshell, given the level of competition in todays market place, we might quality as meeting and improving upon customer requirements. define

)raditionally, the notion has been that if we produce something that does not meet customer requirements, we need to find the deficiency before giving it to the customer. "ence, the emphasis was on defining sampling plans, operating curves, acceptable quality levels, and so on and is basically a reactive approach. )his approach is no longer acceptable. ,uality is now viewed as designing processes that prevent errors as opposed to finding them and is expected to be proactive. )he reason quality has gained such prominence is that organi*ations have gained an

understanding about the high cost of poor quality. ,uality affects all aspects of the organi*ation and has dramatic cost implications. )he most obvious consequence occurs when poor quality creates dissatisfied customers and eventually leads to loss of business. CO$T O! QUALITY )he term cost of quality/&!,0 is really a misnomer+ it is more accurately described as the cost of non+quality, a measurement which indicates how much it costs per year to provide quality in everything it does, whether products or services. )he maAority of senior managers are unaware of the true costs of how much it costs them to get things wrong. %ost of them are ignorant about it for the simple reason that &!, never appears on a balance sheet. In many cases, they have never been asked to measure it and would not know where to start. #hen companies start measuring &!,, they find that the results are staggering. In @urope, manufacturing companies were found to operate with a &!, of 6:+B:C of turnover. In the service sector, it is D7+:7C of turnover. In some public sector units, they were found to be still higherE &ompanies like I1%, 1ritish )elecom and -aguar originally experienced &!, as high as D7C.Feople wondered how their company actually made a profit. &osting quality is an extremely important activity and it has driven many companies to embrace ),% in order to reduce &!, in the long run, which is achievable and possible. &!, is an exercise organi*ations have to pursue if they wish to improve their competitive edge. )he first mistake is to measure only tangible items, for example, direct labour for rework, scrap and wastage of materials. )he costs in manufacturing are low+ but the rework in the service area, which are huge, tend to be ignored. Deming, the quality guru, claims that G:C of quality problems are created by people who never touch the product. %easure the intangibles in service areas first. )his is where real waste is evident. 5et us illustrate this with an example. %anagements are keen to promote the market share of their product over competitors. %arketing teams spend lot of time with customers and are keen to agree to their special requirements. In many cases, they agree to modifications to their standardi*ed product. )his is all fine+ but they should be careful that these modifications do not become excessive or time consuming for those in manufacturing to produce. )he company starts to get a name for becoming customer rather than product led. %eanwhile, new orders pour into the company. It creates further problems for designers and draughtsmen, for inventory control officers who have to order non+ standard components, for shopfloor which has to develop new approaches to manufacturing and assembly. )he few agreed modifications change the large batch production lines into a Aobbing shop. %aterial management issues arise and cost of inventory goes high. )he lesson is that companies can go out of business with full order books . if they fail to promote internal dynamics to support an external demand for customi*ed sales.

)he cost of quality has two components Hi0 Avoidance costs and ii0 total failure costs. i0 Avoidance costsH )hey are further broken down into two categories+ appraisal costs and prevention costs a0 Appraisal costsH )hese costs are the expenditures made by the organi*ation to examine the levels of quality at which products are being produced. If product quality levels are satisfactory, production is allowed to continue .!therwise, production is suspended till effective corrective action has been implemented and satisfactory levels of product quality are achieved. Appraisal costs are expected to discover and correct problems after the problems surface. @xamples are all inspection related expenses including salaries and fringe benefits, test samples for destructive tests, lab materials consumed in process tests, laboratory tooling expenses, costs associated with F&, inspections and tests within the process. b0 Frevention costs )hese are those expenditures a company makes to avoid producing defective or unacceptable product. )hese are applied before the defective component is produced. @xamples are all training, quality assurance expenses, cost of design changes, the portion of design engineering devoted to quality assurance and cost of processing changes incurred prior to release for production. ii0 )otal failure costs have two components+ Internal failure costs and @xternal failure costs a0 Internal failure costs are those incurred by the company while it still has ownership of the product. @xamplesH scrap, waste in process, rework and repair charges. b0 @xternal failure costs are those incurred by an organi*ation after it has transferred ownership to its customer. @xamples are warranty costs, returned goods, design error and marketing error. &ompanies that consider quality important invest heavily in prevention and appraisal costs in order to prevent internal and external failure costs. )he earlier defects are found, the less costly they are to correct. 2or example, detecting and correcting defects during product design and product production is considerably less expensive than when the defects are found at the customer site.

Quality Gurus )o fully appreciate the development of ),% movement, it is essential to understand the valuable contributions made by a few ,uality Iurus. Walter A%$he&art #alter A. hewart was a tatistician at 1ell 5abs in the period 6;B7+J7."e recogni*ed that variability existed in all manufacturing processes. "e developed quality control charts that are used to identify whether the variability in the process is random or due to an assignable cause, such as poor workers or miscalibrated machinery. "e stressed that eliminating variability improves quality. "is work created the foundation for todays statistical process control, and he is often referred to as the 4grandfather of quality control3. W%E#&ar#s 'emin( #. @dwards Deming is often referred to as the 4father of quality control3 and is one of the most inspirational and influential gurus of quality in the twentieth century. "e was a statistics professor at (ew <ork >niversity in the 6;D7s. After #orld #ar II he assisted many -apanese companies in improving quality. )he -apanese regarded him so highly that in 6;:6 they established the Deming Prize, an annual award given to firms that demonstrate outstanding quality. It was almost J7 years later that American businesses began adopting Demings philosophy. A number of elements of Demings philosophy depart from traditional notions of quality. )he first is the role management should play in a companys quality improvement effort. "istorically, poor quality was blamed on workersKon their lack of productivity, la*iness, or carelessness. "owever, Deming pointed out that only 6: percent of quality problems are actually due to worker error. )he remaining G: percent are caused by processes and systems, including poor management. Deming said that it is up to management to correct system problems and create an environment that promotes quality and enables workers to achieve their full potential. "e believed that managers should drive out any fear employees have of identifying quality problems, and that numerical quotas should be eliminated. Froper methods should be taught, and detecting and eliminating poor quality should be everyones responsibility. Deming outlined his philosophy on quality in his famous 46D Foints.3 )hese points are principles that help guide companies in achieving quality improvement. )he principles are founded on the idea that upper management must develop a commitment to quality and provide a system to support this commitment that involves all employees and suppliers. Deming stressed that quality improvements cannot happen without organi*ational change that comes from upper management. Demings 6D points for transformation of %anagementH 6. &reate constancy of purpose towards improvement of product and service with the aim to become competitive, to stay in business and to provide Aobs. B. Adopt a new philosophy

J. &ease reliance on mass inspection to achieve quality. @liminate the need for inspection on a mass basis by building quality into the product in the first place. D. @nd the business of awarding business on the basis of price alone. :. &onstantly improve the system of production and service= this will improve quality and productivity and constantly decrease costs L. Institute training on the Aob. M. Institute leadership= the aim of supervision should be to help people and machines and gadgets to do a better Aob. G. Drive out fear so that everyone may work effectively for the company. ;. 1reak down barriers between departments 67. @liminate slogans 66. ubstitute leadership for work standards and management by obAectives. 6B. ?emove barriers that rob the hourly workers and management of their right to pride of workmanship. )he responsibility of supervisors must be changed from mere numbers to quality. @nd annual reviews or merit rating and management by obAectives. 6J. Institute a rigorous program of education and self+improvement. 6D. Fut everybody in the company to work to accomplish the transformation+it is everybodys Aob. ome valuable quotations from DemingH

a0 Nnowledge is the key ingredient of quality b0 ,uality must come first. As quality increases, costs decrease. c0 1y allowing and even urging workers to experience the intrinsic rewards that come from doing something well and by using their innate and acquired abilities, productivity improves, quality improves, and customer satisfaction improves. d0 ?unning a company by profit alone is like driving a car by looking in the rearview mirror. It tells where you have been, not where you are going. e0 Inspection is too late. If workers can produce defect+free goods, eliminate inspectors. f0 1uy from suppliers committed to quality. Invest time and knowledge to help suppliers to improve quality and costs. Develop long+term relationships with suppliers. g0 )he financial statements are not reality. )hey are financial descriptions of the past, a one+dimensional picture of a multidimensional world. h0 #hen top management blames every accident on the lax behaviour of workers, they are admitting their ignorance and abdicating their responsibilities. i0 It is a mistake to believe that one is improving quality when an inspector reAects a defective product or when a maAor quality flaw is found. )hat is Aust recogni*ing a defect produced by a system= it is not improving quality and it is not improving the system. A0 &ooperation is fundamental ingredient that leads to improvement. In conventional thinking, competition is always preferred over cooperation. k0 )he company that develops loyal customers has much higher earnings than the company that Aust pushes the product out of the door.

Demings cycle of continuous improvement )he FD&A &ycle was developed by Deming, and is also known as the Deming #heel. )he basic concept is that first you plan what you are going to do, then you do it, then you check the results. If the results are !N, you standardise your plan and put it into regular use. If the results are not satisfactory you make changes to your plan, try it again, and if this time the results are !N you standardi*e the changed version of your plan, and put it into regular use. )he FD&A &ycle can be used for the simplest Aobs or for the most complex company activities. It is an excellent system for a manager to use to continuously improve the level of quality in his or her department. 'r%)%M%)uran After #. @dwards Deming, Dr. )ose h )uran is considered to have had the greatest impact on quality management. -uran originally worked in the quality program at #estern @lectric. "e became better known in 6;:6, after the publication of his book Quality Control Handbook. In 6;:D he went to -apan to work with manufacturers and teach classes on quality. )hough his philosophy is similar to Demings, there are some differences. #hereas Deming stressed the need for an organi*ational 4transformation,3 -uran believes that implementing quality initiatives should not require such a dramatic change and that quality management should be embedded in the organi*ation. !ne of -urans significant contributions is his focus on the definition of quality and the cost of quality. -uran is credited with defining quality as fitness for use rather than simply conformance to specifications. Defining quality as fitness for use takes into account customer intentions for use of the product, instead of only focusing on technical specifications. -uran is also credited with developing the concept of cost of quality, which

allows us to measure quality in financial terms rather than on the basis of subAective evaluations. -uran is well known for originating the idea of the quality trilogyH quality planning, quality control, and quality improvement. )he first part of the trilogy, quality planning, is necessary so that companies identify their customers, product requirements,,and overriding business goals. Frocesses should be set up to ensure that the quality standards can be met. )he second part of the trilogy, quality control, stresses the regular use of statistical control methods to ensure that quality standards are met and to identify variations from the standards. )he third part of the quality trilogy is quality improvement. According to -uran, quality improvements should be continuous as well as breakthrough. )ogether with Deming, -uran stressed that to implement continuous improvement workers need to have training in proper methods on a regular basis. !ther important issues that -uran highlighted areH )he notion that quality is not free because of law of diminishing returns. )here is an optimum point of quality beyond which conformance is more costy than the quality obtained. )he role of purchasings role in quality and control of the suppliers , because they are part of the quality chain. @ffective supplier qualification and surveys are vital to ensure that the supplier can consistently manufacture to specifications. ingle sourcing can be counterproductive for an organi*ation since a single source can more easily neglect to sharpen its competitive edge in quality, cost and service.

Arman# "%!ei(en*aum Another quality leader is Arman# "% !ei(en*aum+ who introduced the concept of total quality control. In his 6;L6 book Total Quality Control, he outlined his quality principles in D7 steps. 2eigenbaum took a total system approach to quality. "e promoted the idea of a work environment where quality developments are integrated throughout the entire organi*ation, where management and employees have a total commitment to improve quality, and people learn from each others successes. )his philosophy was adapted by the -apanese and termed 4company+wide quality control.3 ,hili -% Cros*y ,hili -% Cros*y is another recogni*ed guru in the area of ),%. "e worked in the area of quality for many years, first at %artin %arietta and then, in the 6;M7s, as the vice president for quality at I)). "e developed the phrase 4Do it right the first time3 and the notion of zero defects, arguing that no amount of defects should be considered acceptable. "e scorned the idea that a small number of defects is a normal part of the operating process because systems and workers are imperfect. Instead, he stressed the idea of prevention. )o promote his concepts, &rosby wrote a book titled Quality s !ree, which was published in 6;M;. "e became famous for coining the phrase 4quality is free3 and for

pointing out the many costs of quality, which include not only the costs of wasted labor, equipment time, scrap, rework, and lost sales, but also organi*ational costs that are hard to quantify. &rosby stressed that efforts to improve quality more than pay for themselves because these costs are prevented. )herefore, quality is free. 5ike Deming and -uran, &rosby stressed the role of management in the quality improvement effort and the use of statistical control tools in measuring and monitoring quality. .aoru Ishi/a&a .aoru Ishi/a&a is best known for the development of quality tools called cause+and+ effect diagrams, also called fishbone or Ishikawa diagrams. )hese diagrams are used for quality problem solving. "e was the first quality guru to emphasi*e the importance of the 4internal customer,3 the next person in the production process. "e was also one of the first to stress the importance of total company quality control, rather than Aust focusing on products and services. Dr. Ishikawa believed that everyone in the company needed to be united with a shared vision and a common goal. "e stressed that quality initiatives should be pursued at every level of the organi*ation and that all employees should be involved. Dr. Ishikawa was a proponent of implementation of quality circles, which are small teams of employees that volunteer to solve quality problems. Genichi Ta(uchi Dr. Genichi Ta(uchi is a -apanese quality expert known for his work in the area of product design. "e estimates that as much as G7 percent of all defective items are caused by poor product design. )aguchi stresses that companies should focus their quality efforts on the design stage, as it is much cheaper and easier to make changes during the product design stage than later during the production process. )aguchi is known for applying a concept called design of e"periment to product design. )his method is an engineering approach that is based on developing ro*ust #esi(n+ a design that results in products that can perform over a wide range of conditions. )aguchis philosophy is based on the idea that it is easier to design a product that can perform over a wide range of environmental conditions than it is to control the environmental conditions. )aguchi has also had a large impact on todays view of the costs of quality. "e pointed out that the traditional view of costs of conformance to specifications is incorrect, and proposed a different way to look at these costs. 5ets briefly look at Dr. )aguchis view of quality costs. ?ecall that conformance to specification specifies a target value for the product with specified tolerances. According to the traditional view of conformance to specifications, losses in terms of cost occur if the product dimensions fall outside of the specified limits. "owever, Dr. )aguchi noted that from the customers view there is little difference whether a product falls Aust outside or Aust inside the control limits. "e pointed out that there is a much greater difference in the quality of the product between making the target and being near the control limit. "e also stated that the smaller the variation around the target, the better the quality. 1ased on this he proposed the followingH as

conformance values move away from the target, loss increases as a quadratic function. )his is called the Ta(uchi loss function% According to the function, smaller differences from the target result in smaller costsH the larger the differences, the larger the cost. )he )aguchi loss function has had a significant impact in changing the view of quality cost.

T0E EIG0T ,1INCI,LE$ O! TQM #hat characteri*es ),% is the focus on identifying root causes of quality problems and correcting them at the source, as opposed to inspecting the product after it has been made. (ot only does ),% encompass the entire organi*ation, but it stresses that quality is customer driven. ),% attempts to embed quality in every aspect of the organi*ation. It is concerned with technical aspects of quality as well as the involvement of people in quality, such as customers, company employees, and suppliers. 5et us look at the specific concepts that make up the philosophy of ),%. )he eight principles areH 6. &ustomer+2ocused !rgani*ation B. 5eadership J. Involvement of Feople D. Frocess Approach :. ystem Approach to %anagement L. &ontinual Improvement M. 2actual Approach to Decision+%aking and G. %utually 1eneficial upplier ?elationships. (ow let us examine the principles in detail. ,rinci le 2 3 Customer3!ocuse# Or(ani4ation 4!rgani*ations depend on their customers and therefore should understand current and future customer needs, meet customer requirements and strive to exceed customer expectations3. teps in application of this principle areH

6. >nderstand customer needs and expectations for products, delivery, price, dependability, etc. B. @nsure a balanced approach among customers and other stake holders /owners, people, suppliers, local communities and society at large0 needs and expectations. J. &ommunicate these needs and expectations throughout the organi*ation. D. %easure customer satisfaction and act on results, and :. %anage customer relationships. "ere are two examples of explicit guidelines used to focus on the customers. )he first example is that of "F. )hey recommend each worker 9 employee 9 department to raise the following questionsH 6. #ho are my customers$ B. #hat are their needs $ J. #hat is my product or service$ D. #hat are my customersO measures or expectations$ :. #hat is my process for meeting their needs$ L. Does my product or service meet these needs $ M. #hat actions are needed to improve my process $ )he second example is from %otorola. 6. Identify the work you do. B. Identify whom you do it for. J. #hat do you need to do your work$ from whom$ D. %ap the process. :. %istake+proof the process and eliminate delays L. @stablish quality and cycle time /flow time0 measurements and improve goals. ,rinci le 5 3 Lea#ershi 45eaders establish unity of purpose and direction of the organi*ation. )hey should create and maintain the internal environment in which people can become fully involved in achieving the organi*ations obAectives.3 teps in application of this principle areH 6. 1e proactive and lead by example. B. >nderstand and respond to changes in the external environment. J. &onsider the needs of all stake holders including customers, owners, people, suppliers, local communities and society at large. D. @stablish a clear vision of the organi*ations future. :. @stablish shared values and ethical role models at all levels of the organi*ation. L. 1uild trust and eliminate fear. M. Frovide people with the required resources and freedom to act with responsibility and accountability. G. Inspire, encourage and recogni*e peoples contributions. ;. Fromote open and honest communication. 67. @ducate, train and coach people.

66. et challenging goals and targets, and 6B. Implement a strategy to achieve these goals and targets. ,rinci le 6 3 In7ol7ement of ,eo le 4Feople at all levels are the essence of an organi*ation and their full involvement enables their abilities to be used for the organi*ations benefit3. teps in application of this principle areH 6. Accept ownership and responsibility to solve problems. B. Actively seek opportunities to make improvements, and enhance competencies, knowledge and experience. J. 2reely share knowledge and experience in teams. D. 2ocus on the creation of value for customers. :. 1e innovative in furthering the organi*ations obAectives. L. Improve the way of representing the organi*ation to customers, local communities and society at large. M. "elp people derive satisfaction from their work, and G. %ake people enthusiastic and proud to be part of the organi*ation. ,rinci le 8 3 ,rocess A roach

4A desired result is achieved more efficiently when related resources and activities are managed as a process.3 teps in application of this principle areH 6. Define the process to achieve the desired result. B. Identify and measure the inputs and outputs of the process. J. Identify the interfaces of the process with the functions of the organi*ation. D. @valuate possible risks, consequences and impacts of processes on customers, suppliers and other stake holders of the process. :. @stablish clear responsibility, authority, and accountability for managing the process. L. Identify internal and external customers, suppliers and other stake holders of the process, and M. #hen designing processes, consider process steps, activities, flows, control measures, training needs, equipment, methods, information, materials and other resources to achieve the desired result. ,rinci le 9 3 $ystem A roach to Mana(ement

4Identifying, understanding and managing a system of interrelated processes for a given obAective improves the organi*ations effectiveness and efficiency.3 teps in application of this principle areH 6. Define the system by identifying or developing the processes that affect a given obAective. B. tructure the system to achieve the obAective in the most efficient way. J. >nderstand the interdependencies among the processes of the system. D. &ontinually improve the system through measurement and evaluation, and

:. @stimate the resource requirements and establish resource constraints prior to action. ,rinci le : 3 Continual Im ro7ement 4&ontinual improvement should be a permanent obAective of the organi*ation.3 teps in application of this principle areH 6. %ake continual improvement of products, processes and systems an obAective for every individual in the organisation. B. Apply the basic improvement concepts of incremental improvement and breakthrough improvement. J. >se periodic assessments against established criteria of excellence to identify areas for potential improvement. D. &ontinually improve the efficiency and effectiveness of all processes. :. Fromote prevention based activities. L. Frovide every member of the organi*ation with appropriate education and training, on the methods and tools of continual improvement such as the Flan+ Do+&heck+Act cycle, problem solving, process re+engineering, and process innovation. M. @stablish measures and goals to guide and track improvements, and G. ?ecogni*e improvements. ,rinci le ; 3 !actual A roach to 'ecision Ma/in(

4@ffective decisions are based on the analysis of data and information.3 teps in application of this principle areH 6. )ake measurements and collect data and information relevant to the obAective. B. @nsure that the data and information are sufficiently accurate, reliable and accessible. J. Analy*e the data and information using valid methods. D. >nderstand the value of appropriate statistical techniques, and :. %ake decisions and take action based on the results of logical analysis balanced with experience and intuition. ,rinci le < 3 Mutually -eneficial $u lier 1elationshi s

4An organi*ation and its suppliers are interdependent, and a mutually beneficial relationship enhances the ability of both to create value.3 teps in application of this principle areH 6. Identify and select key suppliers. B. @stablish supplier relationships that balance short+term gains with long+term considerations for the organi*ation and society at large. J. &reate clear and open communications. D. Initiate Aoint development and improvement of products and processes. :. -ointly establish a clear understanding of customers needs. L. hare information and future plans, and M. ?ecogni*e supplier improvements and achievements.

U$E O! QUALITY TOOL$ #e can see that ),% places a great deal of responsibility on all workers. If employees are to identify and correct quality problems, they need proper training. )hey need to understand how to assess quality by using a variety of quality control tools, how to interpret findings, and how to correct problems. )hese are often called the seven tools of quality control. )hey are easy to understand, yet extremely useful in identifying and analy*ing quality problems. ometimes workers use only one tool at a time, but often a combination of tools is most helpful. Cause3an#3effect #ia(rams are charts that identify potential causes for particular quality problems. )hey are often called fishbone diagrams because they look like the bones of a fish. A general cause+and+effect diagram is shown in figure below. )he 4head3 of the fish is the quality problem, such as crack in a forging or a broken pin. )he diagram is drawn so that the 4spine3 of the fish connects the 4head3 to the possible cause of the problem. )hese causes could be related to the machines, workers, measurement, suppliers, materials, and many other aspects of the production process. @ach of these possible causes can then have smaller 4bones3 that address specific issues that relate to each cause. 2or example, a problem with machines could be due to a need for adAustment, old equipment, or tooling problems. imilarly, a problem with workers could be related to lack of training, poor supervision, or fatigue.

&ause+and+effect diagrams are problem+solving tools commonly used by quality control teams. pecific causes of problems can be explored through brainstorming. )he development of a cause+and+effect diagram requires the team to think through all the possible causes of poor quality. A maAor disadvantage of cause+and+effect diagram is that many causes for a quality problem could appear on a single branch.

A flo&chart is a schematic diagram of the sequence of steps involved in an operation or process. It provides a visual tool that is easy to use and understand. 1y seeing the steps involved in an operation or process, everyone develops a clear picture of how the operation works and where problems could arise.It can be used to facilitate effectiveness during brainstorming session, constructing a cause+and+effect diagram, and in every other situation where there is an ambivalence about what the present state is.

A chec/list is a list of common defects and the number of observed occurrences of these defects. It is a simple yet effective fact+finding tool that allows the worker to collect specific information regarding the defects observed. )he checklist below shows four defects and the number of times they have been observed in a batch in a garment factory. It is clear that the biggest problem is ripped material. )his means that the plant needs to focus on this specific problemKfor example, by going to the source of supply or seeing whether the material rips during a particular production process. l.no. 6 B J Defect type 1roken *ipper 2aded colour %issing buttons (o.of defects PPP PPPP PP )otal J D B

D ?ipped material PPPPP : A checklist can also be used to focus on other dimensions, such as location or time. 2or example, if a defect is being observed frequently, a checklist can be developed that measures the number of occurrences per shift, per machine, or per operator. In this fashion we can isolate the location of the particular defect and then focus on correcting the problem. Control charts are a very important quality control tool. )hese charts are used to evaluate whether a process is operating within expectations relative to some measured value such as weight, width, or volume. 2or example, we could measure the weight of a sack of flour, the width of a tire, or the volume of a bottle of soft drink. #hen the production process is operating within expectations, we say that it is 4in control.3

)o evaluate whether or not a process is in control, we regularly measure the variable of interest and plot it on a control chart. )he chart has a line down the center representing the average value of the variable we are measuring. Above and below the center line are two lines, called the upper control limit />&50 and the lower control limit /5&50. As long as the observed values fall within the upper and lower control limits, the process is in control and there is no problem with quality. #hen a measured observation falls outside of these limits, there is a problem. $catter #ia(rams are graphs that show how two variables are related to one another. )hey are particularly useful in detecting the amount of correlation, or the degree of linear relationship, between two variables. 2or example, increased production speed and number of defects could be correlated positively= as production speed increases, so does the number of defects. )wo variables could also be correlated negatively, so that an increase in one of the variables is associated with a decrease in the other. 2or example, increased worker training might be associated with a decrease in the number of defects observed. )he greater the degree of correlation, the more linear are the observations in the scatter diagram. !n the other hand, the more scattered the observations in the diagram, the less correlation exists between the variables. !f course, other types of relationships can also be observed on a scatter diagram, such as an inverted >. )his may be the case when one is observing the relationship between two variables such as oven temperature

and number of defects, since temperatures below and above the ideal could lead to defects.

,areto analysis is a technique used to identify quality problems based on their degree of importance. )he logic behind Fareto analysis is that only a few quality problems are important, whereas many others are not critical. )he technique was named after Qilfredo Fareto, a nineteenth+century Italian economist who determined that only a small percentage of people controlled most of the wealth. )his concept has often been called the G7.B7 rule and has been extended to many areas. In quality management the logic behind Faretos principle is that most quality problems are a result of only a few causes. )he trick is to identify these causes. !ne way to use Fareto analysis is to develop a chart that ranks the causes of poor quality in decreasing order based on the percentage of defects each has caused. 2or example, a tally can be made of the number of defects that result from different causes, such as operator error, defective parts, or inaccurate machine calibrations. Fercentages of defects can be computed from the tally and placed in a chart .#e generally tend to find that a few causes account for most of the defects. In brief, Fareto analysis should be used in various stages of quality improvement to determine which step to take next and to prioritise actions on the basis of frequency of defects.

A histo(ram is a chart that shows the frequency distribution of observed values of a variable. #e can see from the plot what type of distribution a particular variable displays, such as whether it has a normal distribution and whether the distribution is symmetrical.

)o construct a histogram 6. Determine how many data values to use B. Determine width of the data by computing the range J. elect the number of cells for the histogram

D. Determine the width of each cell :. Determine the staring number for the first interval L. &alculate the intervals M. Assign data values to the appropriate intervals G. &onstruct the histogram by drawing bars to represent the cell frequencies

QUALITY !UNCTION 'E,LOYMENT

R)ime was when a man could order a pair of shoes directly from the cobbler.1y measuring the foot himself and personally handling all aspects of manufacturing, the cobbler could assure the customer would be satisfied,R lamented Dr.<oAi Akao, one of the founders of ,2D, in his lectures. Quality !unction 'e loyment =Q!'> was developed to bring this personal interface to modern manufacturing and business. In todayOs industrial society, where the growing distance between producers and users is a concern, ,2D links the needs of the customer /end user0 with design, development, engineering, manufacturing, and service functions. ,2D has been evolved by product development people in response to the maAor problems in the traditional processes such as a0Disregard the voice of the customer b0 Disregard the competition c0&oncentration on each specification in isolation d05ow expectations e05ittle input from design and production people into product planning f0 Divergent interpretation of the specifications g0 5ack of structure h0 5ost information i0 #eak commitment to previous decisions As a quality system that implements elements of ystems )hinking with elements of Fsychology and @pistemology /knowledge0, ,2D provides a system of comprehensive development process forH >nderstanding OtrueO customer needs from the customerOs perspective

#hat OvalueO means to the customer, from the customerOs perspective >nderstanding how customers or end users become interested, choose, and are satisfied Analy*ing how do we know the needs of the customer Deciding what features to include Determining what level of performance to deliver Intelligently linking the needs of the customer with design, development, engineering, manufacturing, and service functions Intelligently linking Design for ix igma /D2 0 with the front end Qoice of &ustomer analysis and the entire design system

,2D is a comprehensive quality system that systematically links the needs of the customer with various business functions and organi*ational processes, such as marketing, design, quality, production, manufacturing, sales, etc., aligning the entire company toward achieving a common goal. It consists in translating customer desires /for example, the ease of writing for a pen0 into design characteristics /pen ink viscosity, pressure on ball+point0 for each stage of the product development . In short, the voice of the customer is translated into the voice of the engineer.

,2D does so by seeking both spoken and unspoken needs, identifying positive quality and business opportunities, and translating these into actions and designs by using transparent analytic and prioriti*ation methods, empowering organi*ations to exceed normal expectations and provide a level of unanticipated excitement that generates value. )he ,2D methodology can be used for both tangible products and non+tangible services, including manufactured goods, service industry, software products, I) proAects, business process development, government, healthcare, environmental initiatives, and many other applications. 1eginning with the initial matrix, commonly termed the house of ?uality, depicted in figure below, the ,2D methodology focuses on the most important product or service.

!nce you have prioriti*ed the attributes and qualities, ,2D deploys them to the appropriate organi*ational function for action, as shown in 2igure B. )hus, ,2D is the deployment of customer+driven qualities to the responsible functions of an organi*ation.

%any ,2D practitioners claim that using ,2D has enabled them to reduce their product and service development cycle times by as much as M: percent with equally impressive improvements in measured customer satisfaction. )@F+1<+ )@F AFF?!A&" )! ,2D ,2D uses a series of matrices to document information collected and developed and represent the teamOs plan for a product. )he ,2D methodology is based on a systems engineering approach consisting of the following general stepsH 6. Derive top+level product requirements or technical characteristics from customer needs /Froduct Flanning %atrix0. B. Develop product concepts to satisfy these requirements. J. @valuate product concepts to select most optimum /&oncept election %atrix0. D. Fartition system concept or architecture into subsystems or assemblies and flow+ down higher+ level requirements or technical characteristics to these subsystems or assemblies. :. Derive lower+level product requirements /assembly or part characteristics0 and specifications from subsystem9assembly requirements /Assembly9Fart Deployment %atrix0. L. 2or critical assemblies or parts, flow+down lower+level product requirements /assembly or part characteristics0 to process planning. M. Determine manufacturing process steps to meet these assembly or part characteristics.

G. 1ased in these process steps, determine set+up requirements, process controls and quality controls to assure achievement of these critical assembly or part characteristics. )he matrices and the specific steps in the ,2D process are as follows. Gather Customer Nee#s 6. Flan collection of customer needs. #hat sources of information will be used$ &onsider customer requirement documents, requests for proposals, requests for quotations, contracts, customer specification documents, customer meetings9interviews, focus groups9clinics, user groups, surveys, observation, suggestions, and feedback from the field. &onsider both current customers as well as potential customers. Fay particular attention to lead customers as they are a better indicator of future needs. Flan who will perform the data collection activities and when these activities can take place. chedule activities such as meetings, focus groups, surveys, etc. B. Frepare for collection of customer needs. Identify required information. Frepare agendas, list of questions, survey forms, focus group9user meeting presentations. J. Determine customer needs or requirements using the mechanisms described in step 6. Document these needs. &onsider recording any meetings. During customer meetings or focus groups, ask RwhyR to understand needs and determine root needs. &onsider spoken needs and unspoken needs. @xtract statements of needs from documents. ummari*e surveys and other data. >se techniques such as ranking, rating, paired comparisons, or conAoint analysis to determine importance of customer needs. Iather customer needs from other sources such as customer requirement documents, requests for proposals, requests for quotations, contracts, customer specification documents, customer meetings9interviews, focus groups, product clinics, surveys, observation, suggestions, and feedback from the field. D. >se affinity diagrams to organi*e customer needs. &onsolidate similar needs and restate. !rgani*e needs into categories. 1reakdown general customer needs into more specific needs by probing what is needed. %aintain dictionary of original meanings to avoid misinterpretation. >se function analysis to identify key unspoken, but expected needs. :. !nce needs are summari*ed, consider whether to get further customer feedback on priorities. >ndertake meetings, surveys, focus groups, etc. to get customer priorities. tate customer priorities using a 6 to : rating. >se ranking techniques and paired comparisons to develop priorities. ,ro#uct ,lannin( 6. !rgani*e customer needs in the Froduct Flanning %atrix. Iroup under logical categories as determined with affinity diagramming. B. @stablish critical internal customer needs or management control requirements= industry, national or international standards= and regulatory requirements. If standards or regulatory requirements are commonly understood, they should not be included in order to minimi*e the information that needs to be addressed. J. tate customer priorities. >se a 6 to : rating. &ritical internal customer needs or management control requirements= industry, national or international standards=

and regulatory requirements, if important enough to include, are normally given a rating of RJR. D. Develop competitive evaluation of current company products and competitive products. >se surveys, customer meetings or focus groups9clinics to obtain feedback. ?ate the companyOs and the competitorOs products on a 6 to : scale with R:R indicating that the product fully satisfies the customerOs needs. Include competitorOs customer input to get a balanced perspective. :. ?eview the competitive evaluation strengths and weaknesses relative to the customer priorities. Determine the improvement goals and the general strategy for responding to each customer need. )he Improvement 2actor is R6R if there are no planned improvements to the competitive evaluation level. Add a factor of .6 for every planned step of improvement in the competitive rating, /e.g., a planned improvement of going from a rating of RBR to RDR would result in an improvement factor of R6.BR. Identify warranty, service, or reliability problems S customer complaints to help identify areas of improvement. L. Identify the sales points that %arketing will emphasi*e in its message about the product. )here should be no more than three maAor or primary sales points or two maAor sales points and two minor or secondary sales points in order to keep the %arketing message focused. %aAor sales points are assigned a weighting factor of 6.J and minor sales points are assigned a weighting factor of 6.6. M. )he process of setting improvement goals and sales points implicitly develops a product strategy. 2ormally describe that strategy in a narrative form. #hat is to be emphasi*ed with the new product$ #hat are its competitive strengths$ #hat will distinguish it in the marketplace$ "ow will it be positioned relative to other products$ In other words, describe the value proposition behind this product. )he key is to focus development resources on those areas that will provide the greatest value to the customer. )his strategy brief is typically one page and is used to gain initial focus within the team as well as communicate and gain concurrence from management. G. @stablish product requirements or technical characteristics to respond to customer needs and organi*e into logical categories. &ategories may be related to functional aspects of the products or may be grouped by the likely subsystems to primarily address that characteristic. &haracteristics should be meaningful /actionable by @ngineering0, measurable, practical /can be determined without extensive data collection or testing0and global. 1y being global, characteristics should be stated in a way to avoid implying a particular technical solution so as not to constrain designers. )his will allow a wide range of alternatives to be considered in an effort to better meet customer needs. Identify the direction of the obAective for each characteristic /target value or range, maximi*e or minimi*e0. ;. Develop relationships between customer needs and product requirements or technical characteristics. )hese relationships define the degree to which as product requirement or technical characteristic satisfies the customer need. It does (!) show a potential negative impact on meeting a customer need. &onsider the goal associated with the characteristic in determining whether the characteristic satisfies the customer need. >se weights /we recommend using :+ J+6 weighting factors0 to indicate the strength of the relationship + strong, medium and weak. 1e sparing with the strong relationships to discriminate the really strong relationships. 67. Ferform a technical evaluation of current products and competitive products. ources of information includeH competitor websites, industry publications,

customer interviews, published specifications, catalogs and brochures, trade shows, purchasing and benchmarking competitors products, patent information, articles and technical papers, published benchmarks, third+party service S support organi*ations, and former employees. Ferform this evaluation based on the defined product requirements or technical characteristics. !btain other relevant data such as warranty or service repair occurrences and costs. 66. Develop preliminary target values for product requirements or technical characteristics. &onsider data gathered during the technical evaluation in setting target values. Do not get too aggressive with target values in areas that are not determined to be the primary area of focus with this development effort. 6B. Determine potential positive and negative interactions between product requirements or technical characteristics using symbols for strong or medium, positive or negative relationships. )oo many positive interactions suggest potential redundancy in product requirements or technical characteristics. 2ocus on negative interactions + consider product concepts or technology to overcome these potential trade+offs or consider the trade+offOs in establishing target values. 6J. &alculate importance ratings. %ultiply the customer priority rating by the improvement factor, the sales point factor and the weighting factor associated with the relationship in each box of the matrix and add the resulting products in each column. 6D. Identify a difficulty rating /6 to : point scale, five being very difficult and risky0 for each product requirement or technical characteristic. &onsider technology maturity, personnel technical qualifications, resource availability, technical risk, manufacturing capability, supply chain capability, and schedule. Develop a composite rating or breakdown into individual assessments by category. 6:. Analy*e the matrix and finali*e the product plan. Determine required actions and areas of focus. 6L. 2inali*e target values. &onsider the product strategy obAectives, importance of the various technical characteristics, the trade+offs that need to be made based on the interaction matrix, the technical difficulty ratings, and technology solutions and maturity. 6M. %aintain the matrix as customer needs or conditions change. Conce t 'e7elo ment 6. Develop concept alternatives for the product. &onsider not only the current approach and technology, but other alternative concept approaches and technology. >se brainstorming. &onduct literature, technology, and patent searches. >se product benchmarking to identify different product concepts. Develop derivative ideas. Ferform sufficient definition and development of each concept to evalaute against the decision criteria determined in the next step. B. @valuate the concept alternatives using the &oncept election %atrix. 5ist product requirements or technical characteristics from the Froduct Flanning %atrix down the left side of the &oncept election %atrix. Also add other requirements or decision criteria such as key unstated but expected customer needs or requirements, manufacturability requirements, environmental requirements, standards and regulatory requirements, maintainability 9 serviceability requirements, support requirements, testability requirements, test schedule and resources, technical risk, business risk, supply chain capability, development resources, development budget, and development schedule.

J. &arry forward the target values for the product requirements or technical characteristics from the Froduct Flanning %atrix. Add target values as appropriate for the other evaluation criteria added in the previous step. Also bring forward the importance ratings and difficulty ratings associated with each product requirement or technical characteristic from the Froduct Flanning %atrix. (ormali*e the importance rating by dividing the largest value by a factor that will yield R:R and post this value to the RFriorityR column. ?eview these priorities and consider any changes appropriate since these are the weighting factors for the decision criteria. Determine the priorities for the additional evaluation criteria added in the prior step. 5ist concepts across the top of the matrix. D. Ferform engineering analysis and trade studies. ?ate each concept alternative against the criteria using a R6R to R:R scale with R:R being the highest rating for satisfying the criteria. :. 2or each rating, multiply the rating by the RFriorityR value in that row. ummari*e these values in each column in the bottom row. )he preferred concept alternative/s0 will be the one/s0 with the highest total. L. 2or the preferred concept alternative/s0, work to improve the concept by synthesi*ing a new concept that overcomes its weaknesses. 2ocus attention on the criteria with the lowest ratings for that concept /R6OsR and RBOsR0. #hat changes can be made to the design or formulation of the preferred concept/s0 to improve these low ratings with the product concept$ &ompare the preferred concept/s0 to the other concepts that have higher ratings for that particular requirement. Are there ways to modify the preferred concept to incorporate the advantage of another concept$ $u*system@$u*assem*ly@,art 'e loyment MatriA 6. >sing the selected concept as a basis, develop a design layout, block diagram and9or a preliminary parts list. Determine critical subsystems, subassemblies or parts. &onsider impact of subsystems, subassemblies or parts on product performance or with respect to development goals. #hat parts, assemblies or subsystems present maAor challenges or are critical to the success and operation of the product$ #hat critical characteristics have a maAor effect on performance$ &onsider performing failure mode and effects analysis /2%@A0= failure mode, effects and criticality analysis /2%@&A0= or fault tree analysis /2)A0 to help pinpoint critical items and their critical characteristics from a reliability9quality perspective. B. If there will be multiple ubsystem9 ubassembly9Fart Deployment %atrices prepared, deploy the technical characteristics and their target values to the appropriate matrices. &arry forward the important or critical product requirements or technical characteristics from Froduct Flanning %atrix /based on importance ratings and team decision0 to the ubsystem9 ubassembly9Fart Deployment %atrix. )hese Rproduct needsR become the RwhatOsR for this next level matrix. #here appropriate, allocate target values /e.g., target manufacturing cost, mean+ time between failures, etc.0 to the ubsystem 9 ubassembly 9 Fart Deployment %atrices. !rgani*e these product requirements or technical characteristics by assembly/ies0 or part/s0 to be addressed on a particular deployment matrix. Include any additional customer needs or requirements to address more detailed customer needs or general requirements. (ormali*e the Importance ?atings from the Froduct Flanning %atrix and bring them forward as the Friority ratings. ?eview these priority ratings and make appropriate changes for the subsystems,

subassemblies or parts being addressed. Determine the the Friority for any needs that were added. J. &onsidering product requirements or technical characteristics, identify the critical part, subassembly or subsystem characteristics. tate the characteristics in a measurable way. 2or higher+level subsystems or subassembles, state the characteristics in a global manner to avoid constraining concept selection at this next level. D. Develop relationships between product needs /product+level technical characteristics0 and the subsystem 9 subassembly 9 part technical characteristics. >se :+J+6 relationship weights for strong, medium and weak relationships. 1e sparing with the strong relationships. :. Develop preliminary target values for subsystem 9 subassembly 9 part characteristics. L. Determine potential positive and negative interactions between the technical part characteristics using symbols for strong or medium, positive or negative relationships. )oo many positive interactions suggest potential redundancy in critical part characteristics. 2ocus on negative interactions + consider different subsystem 9 subassembly 9 part concepts, different technologies, tooling concepts, material technology, and process technology to overcome the potential trade+off or consider the trade+off in establishing target values. M. &alculate importance ratings. Assign a weighting factor to the relationships /:+J+ 60. %ultiply the customer importance rating by the improvement factor /if any0, the sales point factor /if any0 and the relationship factor in each cell of the relationship matrix and add the resulting products in each column. G. Identify a difficulty rating /6 to : point scale, five being very difficult and risky0 for each subsystem 9 subassembly 9 part requirement or technical characteristic. &onsider technology maturity, personnel technical qualifications, business risk, manufacturing capability, supplier capability, and schedule. Develop a composite rating or breakdown into individual assessments by category. Determine if overall risk is acceptable and if individual risks based on target or specification values are acceptable. AdAust target or specification values accordingly. ;. Analy*e the matrix and finali*e the subsystem9subassembly9part deployment matrix. Determine required actions and areas of focus. 67. 2inali*e target values. &onsider interactions, importance ratings and difficulty ratings.

$TATI$TICAL QUALITY CONT1OL TEC0NIQUE$ ),% focuses on customer+driven quality standards, managerial leadership, continuous improvement, quality built into product and process design, quality identified problems at the source, and quality made everyones responsibility. "owever, talking about solving quality problems is not enough. #e need specific tools that can help us make the right quality decisions. )hese tools come from the area of statistics and are used to help identify quality problems in the production process as well as in the product itself. $tatistical ?uality control =$QC> is the term used to describe the set of statistical tools used by quality professionals. tatistical quality control can be divided into three broad categoriesH 6. 'escri ti7e statistics are used to describe quality characteristics and relationships. Included are statistics such as the mean, standard deviation, the range, and a measure of the distribution of data. B% $tatistical rocess control =$,C> involves inspecting a random sample of the output from a process and deciding whether the process is producing products with characteristics that fall within a predetermined range. F& answers the question of whether the process is functioning properly or not. J. Acce tance sam lin( is the process of randomly inspecting a sample of goods and deciding whether to accept the entire lot based on the results. Acceptance sampling determines whether a batch of goods should be accepted or reAected. All three of these statistical quality control categories are helpful in measuring and evaluating the quality of products or services. "owever, statistical process control / F&0 tools are used most frequently because they identify quality problems during the production process. Frocess %anagement According to ),% a quality product comes from a quality process. )his means that quality should be built into the process. Quality at the source is the belief that it is far better to uncover the source of quality problems and correct it than to discard defective items after production. If the source of the problem is not corrected, the problem will continue. 2or example, if you are baking cookies you might find that some of the cookies are burned. imply throwing away the burned cookies will not correct the problem. <ou will continue to have burned cookies and will lose money when you throw them away. It will be far more effective to see where the problem is and correct it. 2or example, the temperature setting may be too high= the pan may be curved, placing some cookies closer to the heating element= or the oven may not be distributing heat evenly. ,uality at the source exemplifies the difference between the old and new concepts of quality. )he old concept focused on inspecting goods after they were produced or after a particular stage of production. If an inspection revealed defects, the defective products were either discarded or sent back for reworking. All this cost the company money, and these costs were passed on to the customer. )he new concept of quality focuses on identifying quality problems at the source and correcting them.

!ne way to ensure a quality product is to build quality into the process. &onsider teinway S ons, the premier maker of pianos used in concert halls all over the world. teinway has been making pianos since the 6GG7s. ince that time the companys manufacturing process has not changed significantly. It takes the company nine months to a year to produce a piano by fashioning some 6B,777+hand crafted parts, carefully measuring and monitoring every part of the process. #hile many of teinways competitors have moved to mass production, where pianos can be assembled in B7 days, teinway has maintained a strategy of quality defined by skill and craftsmanship. teinways production process is focused on meticulous process precision and extremely high product consistency. )his has contributed to making its name synonymous with top quality. A *rief history of $,C #e must go back almost ;7 years, to 6;BJ when #alter hewart discovered a way to distinguish between common and special causes of variation in a process. "is method is now called statistical process control / F&0. Common cause 7ariation

hewart realised that we must learn to live with and accept the random common causes that occur in manufacturing. )hese common causes together form a dispersion pattern that describes the outcome of the process. @ven more important, hewart understood the danger of reacting to, and acting upon, individual readings of these common causes /see fig. below0.

)wo common scenarios HIndividual sample readings do not show the whole process, which can lead us to draw wrong conclusions. In figure below, we happen to measure a part /60 which lies fairly close to the upper tolerance limit />)50. #e adAust the process accordingly /B0 and thereby, all unwittingly and with the best of intentions, move the whole process so that it occasionally produces defective parts /J0.

In the reverse case we happen to measure a part that lies near the middle of the tolerance range. In the belief that this reading is representative of the whole process, we make no adAustments.

#hat we do not know is that the whole process is badly off+centre and that we are sometimes, between our spot+check samples, producing defective parts /see figure above0. pecial cause variation !nly if the osition or s rea# of the process outcome has changed do we have cause to react and make adAustments. )hese changes are called special causes /see figure below0.

$ee the &hole forest+ not Bust one tree

>sing statistical process control means that instead of checking individual parts and comparing them with the tolerance limits, we get a general overview of our whole process.

tatistical process control lets the company control quality where it is created . at source. )he process is controlled at the right time, for the right reasons and towards the right obAectives. @verybody winsH the operator has better control of the process, there are fewer reAects, and customers are much more satisfied. 0ere are t&o com ellin( reasons for usin( $,CC

Quality is best at the target value. All processes 7ary%

0ere are some more reasonsC

-etter re utation% <our customer will notice the difference compared to your competitors who do not use F&. -etter ?uality% <ou will get early warning signals before you start producing defective parts. Lo&er reBect costs% )he frequency of reAects will almost invariably fall. Clearer o*Becti7es% @very member of your workforce will read the process the same way. Less stress% )he work load will, as a rule, become lighter. $/ill enhancement% Froduction personnel will gain a whole new awareness of their work and their processes. Cost sa7in(s% "igh process capability reduces the need for final inspection. !e&er sto a(es% Incipient machine faults are detected early, which facilitates condition+based

The siA factors )hese are the factors that are generally regarded as causing variation in capability measurementsH

Machine /e.g. degree of wear and choice of tooling0= Measurement /e.g. resolution and spread of measuring instrument0= O erator /e.g. how experienced and careful he9she is0= Material /e.g. variations in surface smoothness and hardness0= En7ironment /e.g. variations in temperature, humidity and voltage0= Metho# /e.g. type of machining operation0.

%achine capability %achine capability is measured in &m and &mk= it is a snapshot picture that shows how well a machine is performing right now in relation to the tolerance limits. 2igure below shows some examples. #hen measuring machine capability you must not alter measurements or change tools, materials, operators or measurement methods, stop the machine, etc. In other wordsH !ut of the six factors, only machine and measurement are allowed to affect the result.

&m /capability mac#ine0 )he &m index describes machine capability= it is the number of times the spread of the machine fits into the tolerance width. )he higher the value of &m, the better the machine. @xampleH if &m T B.:, the spread fits BU times into the tolerance width, while &m T 6 means that the spread is equal to the tolerance width. (ote that even if the spread is off+centre, it is still the same si*e /&m index0. )he figure takes no account of where the spread is positioned in relation to the upper and lower tolerance limits, but simply expresses the relation ship between the width of the spread and the tolerance width /see figure below0.

&mk /capability mac#ine inde"0 If you also want to study the position of the machines capability in relation to the tolerance limits, you use the &mk index, which describes the capability corrected for position. It is not much use having a high &m index if the machine setting is way off centre in relation to the middle of the tolerance range. A high &mk index means, then, that you have a good machine with a small spread in relation to the tolerance width, and also that it is well centred within that width. If &mk is equal to &m, the machine is set to produce exactly in the middle of the tolerance range /see figure below0.

A normal requirement is that &mk should be at least 6.LM.

Frocess capability Frocess capability is a long+term study, measured in &p and &pk, that shows how well a process is performing in relation to the tolerance limits while the study is in progress, as well as indicating likely performance in the immediate future. <ou could say that process capability is the sum of a index of machine capabilities measured over a period of time . #hen measuring process capability, you must include everything that affects the process, i.e. all six factors. &p /capability process0 )he &p index describes process capability= it is the number of times the spread of the process fits into the tolerance width. )he higher the value of &p, the better the process. @xampleH if &p T B.:, the spread of the process fits BU times into the tolerance width, while &p T 6 means that the spread is equal to the tolerance width. (ote that even if the spread is off+centre, it is still the same si*e /&p index0. )he figure takes no account of where the spread is positioned in relation to the upper and lower tolerance limits, but simply expresses the relation ship between the width of the spread and the tolerance width /see figure below0.

&pk /capability process inde"0 If you also want to study the position of the process in relation to the tolerance limits, you use the &pk index, which describes the process capability corrected for position. It is not much use having a high &p index if the process setting is way off centre in relation to the middle of the tolerance range. A high &pk index means, then, that you have a good process with a small spread in relation to the tolerance width, and also that it is well centred within that width. If &pk is equal to &p, the process is set to produce exactly in the middle of the tolerance range /see figure below0. A normal requirement is that &pk should be at least 6.JJ.

&ontrol charts are an efficient way of analy*ing performance data to evaluate a process. &ontrol charts have many uses= they can be used in manufacturing to test if machinery are producing products within specifications. Also, they have many simple applications such as professors using them to evaluate tests scores. )o create a control chart, it is helpful to have @xcel= it will simplify your life. teps in preparing a control chartH are as followsH Chec/ to see that your #ata meets the follo&in( criteriaH Data should usually be normally distributed revolving around a mean /average0. In the example below, a bottle company fills their bottles to 6L o*. /mean0= they are evaluating if their process is 4in+control3. )he amount in ounces over 6L o*. is normally distributed around the mean. %easurements need to be independent of one another. In the example, the measurements are in subgroups. )he data in the subgroups should be independent of the measurement number= each data point will have a subgroup and a measurement number.

!in# the mean of each su*(rou )o find the mean, add all measurements in the subgroup and divide by the number of measurements in the subgroup. In the example, there are B7 subgroups and in each subgroup there are D measurements. !in# the mean of all means

This will give you the overall mean of all the data points. The overall mean will be the centerline in the graph (CL), which is 13. ! for our e"ample. Calculate the standard deviation (S) of the data points . Calculate the upper and lower control limits (UCL, LCL) using the following formula# $CL % CL & 3'( LCL % CL ) 3'( The formula represents 3 standard deviations above and 3 standard deviations below the mean respectively.

Refer

to

the

below

chart

with

steps

given

below .

Draw a line at each deviation. *n the above e"ample, there is a line drawn at one, two, and three standard deviations (sigma+s) away from the mean. ,one C is 1 sigma away from the mean (green). ,one - is . sigma away from the mean (yellow). ,one / is 3 sigma away from the mean (red). Graph the !bar Control Chart, b" graphing the subgroup means (#!a#is) verses measurements ("!a#is). 0our graph should loo1 li1e something li1e this#

E7aluate the (ra h to see if the rocess is out3of3control . )he graph is out+of+control if any of the following are trueH Any point falls beyond the red *one /above or below the J+sigma line0. G consecutive points fall on one side of the centerline. B of J consecutive points fall within *one A. D of : consecutive points fall within *one A and9or *one 1. 6: consecutive points are within Vone &. G consecutive points not in *one & /Iuidelines are available on A)S) tandards0 Control limits &ontrol limits are an important aspect of statistical process control. )hey have nothing to do with tolerance limits, because they are designed to call your attention when the process changes its behaviour. An important principle is that control limits are used along with the mean value on the control graph to control the process, unlike tolerance limits, which are used along with individual measurements to determine whether a given part meets specifications or not. )he function of control limits is to centre the process on the target value, which is usually the same as the middle of the tolerance width, and to show where the limit of a stable process lies. )his means, in principle, that you have no reason to react until the control chart signals certain behaviour. A commonly used control graph is the W? graph, where the position and spread of the process are monitored with the help of sub groups and control limits. If a point falls outside a control limit on the W graph, the position of the process has changed /see figure below0.

If a point falls outside a control limit on the ? graph, the spread of the process has changed /see figure next page0.

0o& are control limits #etermine#? )he correct way is to let the control limits adapt to the process. )hat way, a smaller spread in the process gives a narrower control *one, while a greater spread gives a wider control *one /see figure below0.

It is a widespread myth that this will cause the operator to adAust the process more often, but in practice the reverse is true= the process is adAusted less often compared to operation without F&. If you let the control limits follow the process, you will react neither too early nor too late when the behaviour of the process changes. Other &ays of #eterminin( control limits In some cases there may be difficulties about letting the control limits adapt to the process. !ne such case is where the process uses tools that are not easily adAustable, such as fixed reamers or punches. ince such tools often produce very little variation in the process and therefore allow a narrow control *one without the possibility of adAusting the tool, it may be better to cut the control limits loose from the process and lock them to a given distance from the tolerance limits instead /see figure next page0

$cceptance sampling, the third branch of statistical quality control, refers to the process of randomly inspecting a certain number of items from a lot or batch in order to decide whether to accept or reAect the entire batch. #hat makes acceptance sampling different from statistical process control is that acceptance sampling is performed either before or after the process, rather than during the process. Acceptance sampling before the process involves sampling materials received from a supplier, such as randomly inspecting crates of fruit that will be used in a restaurant or metal castings that will be used in a machine shop. ampling after the process involves sampling finished items that are to be dispatched either to a customer or to a distribution center. @xamples include randomly testing a certain number of computers from a batch to make sure they meet operational requirements, and randomly inspecting switches to make sure that they are not defective. <ou may be wondering why we would only inspect some items in the lot and not the entire lot. Acceptance sampling is used when inspecting every item is not physically possible or would be overly expensive, or when inspecting a large number of items would lead to errors due to worker fatigue. )his last concern is especially important when a large number of items are processed in a short period of time. Another example of when acceptance sampling would be used is in destructive testing, such as testing fuses or vehicles for crash testing. !bviously, in these cases it would not be helpful to test every itemE "owever, 677 percent inspection does make sense if the cost of inspecting an item is less than the cost of passing on a defective item. )he goal of acceptance sampling is to determine the criteria for acceptance or reAection based on the si*e of the lot, the si*e of the sample, and the level of confidence we wish to attain. Acceptance sampling can be used for both attribute and variable measures, though it is most commonly used for attributes. A control c#art for variables is used to monitor characteristics that can be measured and have a continuum of values, such as height, weight, or volume. A soft drink bottling operation is an example of a variable measure, since the amount of liquid in the bottles is measured and can take on a number of different values. A control c#art for attributes, on the other hand, is used to monitor characteristics that have discrete values and can be counted. !ften they can be evaluated with a simple yes or no decision. @xamplesH the apple is good or rotten, the lightbulb works or it does not work A sam lin( lan is a plan for acceptance sampling that precisely specifies the parameters of the sampling process and the acceptance9reAection criteria. )he variables to be specified include the si*e of the lot /%0, the si*e of the sample inspected from the

lot /n0, the number of defects above which a lot is reAected / c0, and the number of samples that will be taken. )here are different types of sampling plans. ome call for single sampling, in which a random sample is drawn from every lot. @ach item in the sample is examined and is labeled as either 4good3 or 4bad.3 Depending on the number of defects or 4bad3 items found, the entire lot is either accepted or reAected. 2or example, a lot si*e of :7 cookies is evaluated for acceptance by randomly inspecting 67 cookies from the lot. )he cookies may be inspected to make sure they are not broken or burned. If D or more of the 67 cookies inspected are bad, the entire lot is reAected. In this example, the lot si*e %& :7, the sample si*e n& 67, and the maximum number of defects at which a lot is accepted is c& D. )hese parameters define the acceptance sampling plan. Another type of acceptance sampling is called double sampling. )his provides an opportunity to sample the lot a second time if the results of the first sample are inconclusive. In double sampling we first sample a lot of goods according to preset criteria for definite acceptance or reAection. "owever, if the results fall in the middle range, they are considered inconclusive and a second sample is taken. 2or example, a water treatment plant may sample the quality of the water ten times in random intervals throughout the day. &riteria may be set for acceptable or unacceptable water quality, such as .7: percent chlorine and .6 percent chlorine. "owever, a sample of water containing between .7: percent and .6 percent chlorine is inconclusive and calls for a second sample of water. As we have seen, different sampling plans have different capabilities for discriminating between good and bad lots. At one extreme is 677 percent inspection, which has perfect discriminating power. "owever, as the si*e of the sample inspected decreases, so does the chance of accepting a defective lot. #e can show the discriminating power of a sampling plan on a graph by means of an o eratin( characteristic =OC> cur7e% )his curve shows the probability or chance of accepting a lot given various proportions of defects in the lot.

)he " axis shows the percentage of items that are defective in a lot. )his is called 4lot quality.3 )he y axis shows the probability or chance of accepting a lot. <ou can see that if we use 677 percent inspection we are certain of accepting only lots with *ero defects. "owever, as the proportion of defects in the lot increases, our chance of accepting the lot decreases. ?egardless of which sampling plan we have selected, the plan is not perfect. )hat is, there is still a chance of accepting lots that are 4bad3 and reAecting 4good3 lots. )he steeper the !& curve, the better our sampling plan is for discriminating between 4good3 and 4bad.3 #hen 677 percent inspection is not possible, there is a certain amount of risk for consumers in accepting defective lots and a certain amount of risk for producers in reAecting good lots. )here is a small percentage of defects that consumers are willing to accept. )his is called the acce ta*le ?uality le7el =AQL> and is generally in the order of 6.B percent. "owever, sometimes the percentage of defects that passes through is higher than the A,5. &onsumers will usually tolerate a few more defects, but at some point the number of defects reaches a threshold level beyond which consumers will not tolerate them. )his threshold level is called the lot tolerance ercent #efecti7e =LT,'>% )he 5)FD is the upper limit of the percentage of defective items consumers are willing to tolerate. ConsumerDs ris/ is the chance or probability that a lot will be accepted that contains a greater number of defects than the 5)FD limit. )his is the probability of making a )ype II errorKthat is, accepting a lot that is truly 4bad.3 &onsumers risk or )ype II error is generally denoted by beta /X0. ,ro#ucerDs ris/ is the chance or probability that a lot containing an acceptable quality level will be reAected. )his is the probability of making a )ype I errorKthat is, reAecting a lot that is 4good.3 It is generally denoted by alpha /Y0. #e can determine from an !& curve what the consumers and producers risks are. "owever, these values should not be left to chance. ?ather, sampling plans are usually designed to meet specific levels of consumers and producers risk. 2or example, one common combination is to have a consumers risk /X0 of 67 percent and a producers risk /Y 0 of : percent, though many other combinations are possible. 0OW MUC0 AN' 0OW O!TEN TO IN$,ECT a01ased on Froduct cost and product volume As you know, 677 percent inspection is rarely possible. )he question then becomes one of how often to inspect in order to minimi*e the chances of passing on defects and still keep inspection costs manageable. )his decision should be related to the product cost and product volume of what is being produced. At one extreme are high+volume, low+cost items, such as nuts and bolts, for which 677 percent inspection would not be cost Austified. Also, with such a large volume 677 percent inspection would not be possible because worker fatigue sets in and defects are often passed on. At the other extreme are low volume, high+cost items, such as parts that will go into a space shuttle or be used in a medical procedure, that require 677 percent inspection. %ost items fall somewhere between the two extremes Aust described. 2or these items, frequency of inspection should be designed to consider the trade+off between the cost of

inspection and the cost of passing on a defective item. "istorically, inspections were set up to minimi*e these two costs. )oday, it is believed that defects of any type should not be tolerated and that eliminating them helps reduce organi*ational costs. till, the inspection process should be set up to consider issues of product cost and volume. 2or example, one company will probably have different frequencies of inspection for different products. b0 1ased on process stability Another issue to consider when deciding how much to inspect is the stability of the process. table processes that do not change frequently do not need to be inspected often. !n the other hand, processes that are unstable and change often should be inspected frequently. 2or example, if it has been observed that a particular type of drilling machine in a machine shop often goes out of tolerance, that machine should be inspected frequently. !bviously, such decisions cannot be made without historical data on process stability. c0 1ased on lot si*e )he si*e of the lot or batch being produced is another factor to consider in determining the amount of inspection. A company that produces a small number of large lots will have a smaller number of inspections than a company that produces a large number of small lots. )he reason is that every lot should have some inspection, and when lots are large, there are fewer lots to inspect.

,LACE O! IN$,ECTION ince we cannot inspect every aspect of a process all the time, another important decision is to decide where to inspect. ome areas are less critical than others. 2ollowing are some points that are typically considered most important for inspection. Incoming materials %aterials that are coming into a facility from a supplier or distribution center should be inspected before they enter the production process. It is important to check the quality of materials before labor is added to it. 2or example, it would be wasteful for a seafood restaurant not to inspect the quality of incoming lobsters only to later discover that its lobster bisque is bad. Another reason for checking inbound materials is to check the quality of sources of supply. &onsistently poor quality in materials from a particular supplier indicates a problem that needs to be addressed. 2inished goods Froducts that have been completed and are ready for dispatch to customers should also be inspected. )his is the last point at which the product is in the production facility. )he quality of the product represents the companys overall quality. )he final quality level is what will be experienced by the customer, and an inspection at this point is necessary to ensure high quality in such aspects as fitness for use, packaging, and presentation.

1efore costly processes During the production process it makes sense to check quality before performing a costly process on the product. If quality is poor at that point and the product will ultimately be discarded, adding a costly process will simply lead to waste. 2or example, in the production of leather armchairs in a furniture factory, chair frames should be inspected for cracks before the leather covering is added. !therwise, if the frame is defective the cost of the leather upholstery and workmanship may be wasted. U$E O! $QC TOOL$ !O1 IN$,ECTION In addition to where and how much to inspect, managers must decide which tools to use in the process of inspection. As we have seen, tools such as control charts are best used at various points in the production process. Acceptance sampling is best used for inbound and outbound materials. It is also the easiest method to use for attribute measures, whereas control charts are easier to use for variable measures. urveys of industry practices show that most companies use control charts, especially x+bar and ?+charts, because they require less data collection than p+charts. $U,,LIE1 QUALITY Ferformance means taking inputs /such as employee work, marketplace requirements, operating funds, raw materials and supplies0 and effectively and efficiently converting them to outputs deemed valuable by customers. Its in your best interest to select and work with suppliers in ways that will provide for high quality. upplier performance is about more than Aust a low purchase priceH

)he costs of transactions, communication, problem resolution and switching suppliers all impact overall cost. )he reliability of supplier delivery, as well as the suppliers internal policies such as inventory levels, all impact supply+chain performance.

It used to be common to line up multiple suppliers for the same raw material, over concern about running out of stock or a desire to play suppliers against one another for price reductions. 1ut this has given way, in some industries, to working more closely with a smaller number of suppliers in longer+term, partnership+oriented arrangements. 1enefits of supplier partnerships includeH

Fartnership arrangements with fewer suppliers mean less variation in vital process inputs. If your suppliers have proven to be effective at controlling their output, you dont need to monitor the supplier and their product as closely.

@stablishing an effective supplier management process requiresH

upport from the top management of both companies involved.

%utual trust. pending more money now to develop the relationship, in order to prevent problems later.

)he manufacturing industry is in a special situationH %uch of what manufacturers purchase is then incorporated into their products. )his means there is a higher inherent risk, or potential impact, in the manufacturing customer+supplier relationship. 2or this reason, manufacturers often develop detailed supplier+management processes. %oving towards ),% philosophy As we have seen, total quality management has impacts on every aspect of the organi*ation. @very person and every function is responsible for quality and is affected by poor quality. 2or example, recall that %otorola implemented its six+sigma concept not only in the production process but also in the accounting, finance, and administrative areas. imilarly, I ! ;777 standards do not apply only to the production process= they apply equally to all departments of the company. A company cannot achieve high quality if its accounting is inaccurate or the marketing department is not working closely with customers. ),% requires the close cooperation of different functions in order to be successful. Mar/etin( plays a critical role in the ),% process by providing key inputs that make ),% a success. ?ecall that the goal of ),% is to satisfy customer needs by producing the exact product that customers want. %arketings role is to understand the changing needs and wants of customers by working closely with them. )his requires a solid identification of target markets and an understanding of whom the product is intended for. ometimes apparently small differences in product features can result in large differences in customer appeal. %arketing needs to accurately pass customer information along to operations, and operations needs to include marketing in any planned product changes. !inance is another maAor participant in the ),% process because of the great cost consequences of poor quality. Ieneral definitions of quality need to be translated into specific costs. )his serves as a baseline for monitoring the financial impact of quality efforts and can be a great motivator. ?ecall the four costs of quality discussed earlier. )he first two costs, prevention and appraisal, are preventive costs= they are intended to prevent internal and external failure costs. (ot investing enough in preventive costs can result in failure costs, which can hurt the company. !n the other hand, investing too much in preventive costs may not yield added benefits. 2inancial analysis of these costs is critical. <ou can see that finance plays a large role in evaluating and monitoring the financial impact of managing the quality process. )his includes costs related to preventing and eliminating defects, training employees, reviewing new products, and all other quality efforts. Accountin( is important in the ),% process because of the need for exact costing. ),% efforts cannot be accurately monitored and their financial contribution assessed if the company does not have accurate costing methods.

En(ineerin( 'e artment efforts are critical in ),% because of the need to properly translate customer requirements into specific engineering terms. ?ecall the process we followed in developing quality function deployment /,2D0. #e depend on engineering to use general customer requirements in developing technical specifications, identifying specific parts and materials needed, and identifying equipment that should be used. ,urchasin( is another important part of the ),% process. #hereas marketing is busy identifying what the customers want and engineering is busy translating that information into technical specifications, purchasing is responsible for acquiring the materials needed to make the product. Furchasing must locate sources of supply, ensure that the parts and materials needed are of sufficiently high quality, and negotiate a purchase price that meets the companys budget as identified by finance. 0uman 1esources plays a crucial role in ),%. In fact, ),% is all about people.If we manage our people with respect, if we value them and treat them with dignity, they can help us to achieve the impossible."? is critical to the effort to hire employees with the skills necessary to work in a ),% environment. )hat environment includes a high degree of teamwork, cooperation, dedication, and customer commitment. "uman resources is also faced with challenges relating to reward and incentive systems. ?ewards and incentives are different in ),% from those found in traditional environments that focus on rewarding individuals rather than teams. Information Technolo(y is highly important in ),% because of the increased need for information accessible to teams throughout the organi*ation. I) should work closely with a companys ),% development program in order to understand exactly the type of information system best suited for the firm, including the form of the data, the summary statistics available, and the frequency of updating. >se of tools like @xcel and tatit make the use of ,& methods easy. It must be remembered that ),% is oriented towards maintaining the competitive edge of the company. It is not a short term program, a cost+cutting exercise or a public relations gimmick. ),% is the umbrella which covers all improvement activities like F&, ,uality &ircles, &ustomer care, -ust In )ime %anagement, )aguchi methods etc. ),% drives must be tailor made to suit the needs of a particular organi*ation. It is not a package that can be taken from the shelf of one company and dropped neatly into another with the same impact. >se the following ?ADA? techniqueH ? Are the ideas rele7ant to my company$ A "ow would I a ly each of them$ D #hat #ifficulties might I meet and how would I overcome them$ A Are there any a##itional actions that I might take $ ? #hat resources would be needed, what would they cost, and how could they be acquired$ )oyota maintain that on average they receive 677+6D7 ideas per employee each year ,of which ;MC are actioned. )ust 'o It

)here is a story about Dr.Deming being harassed over breakfast by a business Aournalist from America who wanted to know what was needed in the #est to compete with and outdo -apan in total quality . Apparently Dr. Deming looked up from eating, stared at the Aournalist coldly in the eye and told him ,3-ust do it, thats all, Aust do it.3 It is as simple as it is true. !ne pound of practice is worth tons of theory .As the adage goes a Aourney of ten thousand miles starts with a single step. ),% is a long tortuous process. It is not a panacea, but is the closest you will get to one. It is an unswerving commitment to constant innovation and improvement using people and science. 5et us march together to achieve excellence and success through ),%.