Chapter 1

Introduction to Quality

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Modern Importance of Quality

The first job we have is to turn out quality merchandise that consumers will buy and keep on buying. If we produce it efficiently and economically, we will earn a profit, in which you will share. - William Cooper Procter

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Quality Assurance
...is any action directed toward providing customers with goods and services of appropriate quality.

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

History of Quality Assurance (1 of 2)

Skilled craftsmanship during Middle Ages Industrial Revolution: rise of inspection and separate quality departments Statistical methods at Bell System Quality control during World War II Quality management in Japan

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

History of Quality Assurance (2 of 2)

Quality awareness in U.S. manufacturing industry during 1980s: Total Quality Management Malcolm Baldrige National Quality Award (1987) Quality in service industries, government, health care, and education Current and future challenge: keep progress in quality management alive
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Contemporary Influences on Quality

Parterning Learning systems Adaptability and speed of change Environmental sustainability Globalization Knowledge focus Customization and differentiation Shifting demographics
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THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Definitions of Quality
Transcendent definition: excellence Product-based definition: quantities of product attributes User-based definition: fitness for intended use Value-based definition: quality vs. price Manufacturing-based definition: conformance to specifications
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Quality Perspectives
transcendent & product-based
Customer products and services

user-based
needs Marketing

value-based

Design

manufacturingbased Manufacturing
Distribution
Information flow Product flow

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Customer-Driven Quality
Meeting or exceeding customer expectations Customers can be...
Consumers External customers Internal customers
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Total Quality
People-focused management system Focus on increasing customer satisfaction and reducing costs A systems approach that integrates organizational functions and the entire supply chain Stresses learning and adaptation to change Based on the scientific method
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Principles of Total Quality

Customer and stakeholder focus Participation and teamwork Process focus and continuous improvement

...supported by an integrated organizational infrastructure, a set of management practices, and a set of tools and techniques
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Customer and Stakeholder Focus

Customer is principal judge of quality Organizations must first understand customers needs and expectations in order to meet and exceed them Organizations must build relationships with customers Customers include employees and society at large
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THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Participation and Teamwork

Employees know their jobs best and therefore, how to improve them Management must develop the systems and procedures that foster participation and teamwork Empowerment better serves customers, and creates trust and motivation Teamwork and partnerships must exist both horizontally and vertically
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THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Process Focus and Continuous Improvement

A process is a sequence of activities that is intended to achieve some result

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Continuous Improvement
Enhancing value through new products and services Reducing errors, defects, waste, and costs Increasing productivity and effectiveness Improving responsiveness and cycle time performance

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Demings View of a Production System

Suppliers of materials and equipment Receipt and test of materials A B C D Production, assembly inspection Tests of processes, machines, methods Design and Redesign Consumer research Consumers Distribution

NPUTS

PROCESSES

OUTPUTS
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THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Learning
The foundation for improvement Understanding why changes are successful through feedback between practices and results, which leads to new goals and approaches Learning cycle:
Planning Execution of plans Assessment of progress Revision of plans based on assessment findings
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THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Infrastructure, Practices, and Tools

Infrastructure
Leadership Strategic Planning HRM Process mgt. Data and information management

Practices

Performance appraisal

Training

Tools

Trend chart

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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TQ Infrastructure

Customer relationship management Leadership and strategic planning Human resources management Process management Data and information management

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Competitive Advantage
Is driven by customer wants and needs Makes significant contribution to business success Matches organizations unique resources with opportunities Is durable and lasting Provides basis for further improvement Provides direction and motivation Quality supports each of these characteristics
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Quality and Profitability

Improved quality of design Higher perceived value Increased market share Higher prices Increased revenues Higher profitability
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Improved quality of conformance Lower manufacturing and service costs

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Evidence that Quality Impacts Business Results

General Accounting Office study of Baldrige Award applicants Baldrige stock study (see www.quality.nist.gov) Hendricks and Singhal study of quality award winners Performance results of Baldrige Award winners
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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GAO TQ Model
Product and service quality On-time delivery Error/defects Leadership for continuous improvement Quality systems and employee involvement Reliability Customer satisfaction Customer retention Complaints Market share Profits Costs Cycle time Turnover Satisfaction Safety & health Productivity
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Overall satisfaction

Competitiveness

Organization benefits

THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

Three Levels of Quality

Organizational level: meeting external customer requirements Process level: linking external and internal customer requirements Performer/job level: meeting internal customer requirements
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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Quality and Personal Values

Personal initiative has a positive impact on business success Quality begins with personal attitudes Quality-focused individuals often exceed customer expectations Attitudes can be changed through awareness and effort (e.g., personal quality checklists)
THE MANAGEMENT AND CONTROL OF QUALITY, 5e, 2002 South-Western/Thomson LearningTM

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