OPM CHAP 8

Intro: Quality Management

  1. Quality Related Costs
  2. Traditional Approaches to Quality Management
  3. Contemporary Thinking in Quality Management (TQM)
  4. Method of Quality Management
  5. Lean Production

Quality Management

  • Involves planning and controlling activities to ensure the product or service is fit for purpose, meeting design specifications and the needs of customers

Key Processes of Quality Management

  1. Quality Planning
  • devising a quality management plan that describes the processes and metrics that are to be used.
  1. Quality Assurance
  • assuring, validating and exhibiting to the organization that you have the abilities, skills, knowledge and attitude to achieve the desired outcome
  1. Quality Control
  • inspection, testing and measurement of project deliverables
  1. Continual Improvement
  • examining how the three elements above will drive further improvements in efficiency and effectiveness

Quality Related Costs
Types of cost of quality:

  • Prevention costs
  • Appraisal costs
  • Internal failure cost
  • External failure cost

1. Prevention costs

  • cost of preventing defects before they occur
  • e.g. training employees in the best ways to do their job

2. Appraisal costs

  • costs of quality inspection and testing

3. Internal failure costs

  • costs arising from a failure to meet quality standards
  • e.g. cost of re-working parts

4. External failure cost

  • costs arising from a failure to meet quality standard
  • e.g. cost of lost goodwill

Traditional Approach to Quality Management

  • Associated with the inspection of quality management
  • Allows for built in waste and waste reduces profitability

Contemporary Thinking in Quality Management (TQM)

  • philosophy of quality management that originated in Japan
  • continuous improvement in quality, productivity and effectiveness obtained by establishing management responsibility for processes as well as outputs

Features of TQM

  • Prevention of error before they occur
  • Continual improvement
  • Real participant by all
  • Commitment of senior management

TQM Tools

  1. Six Sigma
  2. 5-S Practice
  3. Kaizen
  4. Quality Circles

4. Quality Circles

  • a small group of employees with range of skills from all levels of the organisation
  • Meet voluntarily on a regular basis to discuss quality issues and to develop solutions to real problems.

Advantage of Quality Circles

  • improvements in quality
  • leading to greater customer satisfaction
  • improved productivity

3. Kaizen

  • continuous improvement in performance

Features of Kaizen

  • Involved all level of employees
  • Everyone is encourage to come up with small improvement suggestions on a regular basis
  • involves in setting standards and then continually improving those standards
  • Cycle involve in Kaizen are Deming Cycle (Plan, Do, Check and Act)

2. 5-S Practice

  • An approach to achieving an organised, clean and standardised workplace
  • is often part of a Kaizen approach

5-S Practice
1. Seiri (Sort)

  • Eliminate unnecessary items
    2. Seiton (Organise)
  • A structure filing system
    3. Seiso (Clean)
  • Clean work station regularly
    4. Seiketsu (Standardise)
  • Alphabetic filing system
    5. Shitsuke (Discipline)
  • Do not slip back into old habits

1. Six Sigma

  • to identify root problems and address them
  • focused on the customer and based on the level of performance acceptable to the customer

Critism of Six Sigma

  1. criticised for its focus on current processes and reliance on data because too rigid and limit process innovation
  2. Approach can be time consuming and expensive
  3. The culture must be supportive
  4. The process is heavily data-driven

External Quality Standard

  • widely used EQS are those published by the ISO

Main ISO Standards

  1. ISO 9001
  • contains the quality management standards
  1. ISO 9000 and 9004
  • contains guidelines to help organisations to implement quality standards

Requirements include ISO

  1. A set of procedures that cover all key business processes
  2. Keeping adequate records
  3. Checking output for defects
  4. Facilitating continuous improvement

Implementation of TQM Approach

  1. Step 1: Senior management consultancy
  • Managers must be committed to the programme and should undergo quality training
  1. Step 2: Establish a quality steering committee
  • The committee will guide the company through the process of implementing TQM
  1. Step 3: Presentations and training
  • The steering committee should communicate the benefits of the change programme to employees in order to gain buy in
  1. Step 4: Establish quality circle
  • This will involve employees in the process of quality improvement
  1. Step 5: Documentation
  • The actions carried out should be clearly documented
  1. Step 6: Monitor progress
  • Actual results should be monitored against the standards set

Methods of Quality Measurement
Servqual (measuring service quality)

  • uses 22 questions to understand a respondent's attitude about service quality
  • questions claimed to be reliable indicators of five distinct dimensions (tangible, reliability, responsiveness, assurance, empathy)

Benchmarking

  • process of systematic comparison of a service, practice or process
  • used to provide a target for action in order to improve competitive position
  • Types of benchmarking (competitive, internal, functional)

1. Competitive benchmarking

  • a method of comparing performance in key areas with of the most successful competitors

2. Internal benchmarking

  • a method of comparing performance in key areas in one part of the organisation with the performance in another part of the organisation

3. Functional benchmarking

  • involves comparing a function with the practices of an organisation known to excel in that area

Benchmarking Process

  1. Select process to be benchmarked
  2. Assign responsibilities
  3. Identity potential to benchmark against
  4. Collect, analyse and evaluate information
  5. Identify best practice
  6. Implement the change
  7. Review success

Business Process Re-engineering (BPR)

  • involve focusing attention inwards to consider how the business processes could be redesigned or re-engineered to improve efficiency
  • use contrasts with benchmarking which is an external exercise although the ideas generated through benchmarking may be used here to offer radical solutions

Lean Management

  • aims to systematically eliminate waste

Wasted to be eliminated

  1. Inventory
  2. Waiting
  3. Defective units
  4. Effort
  5. Transportation
  6. Over-processing

Characteristics of Lean Production

  • Improve production scheduling
  • continuous improvement
  • zero inventory
  • zero waiting time

Criticism and limitations on lean manufacturing

  1. High initial outlay
  2. Requires a change in culture
  3. Part adoption
  4. Cost may exceed benefit

Six core method of lean manufacturing

  1. JIT
  2. Kaizen
  3. 5-S Practice
  4. Total Productive Maintenance (TPM)
  5. Cellular Manufacturing
  6. Six Sigma

Factors affecting application of lean techniques to services

  • Services are intangible
  • Services are consumed immediately