Ops Management Lecture 5

1. Chapter five
Quality management

2. Learning objectives
• Understand the need for quality in organizations
• Describe different definitions of quality
• Describe a good or service in terms of the
quality dimensions
• Identify and describe the eight principles of
quality systems
• Discuss some of the popular quality standards
• Name and describe the contributions of some of
the quality gurus
• Describe the roles of various South African
organisations for quality

3. Learning objectives (cont.)
• Discuss some of the popular quality
standards
• Name and describe the contributions of
some of the quality gurus
• Describe the roles of various South
African organisations for quality.

4. 5.1 Introduction
• Quality:
– Expectations
– Standards
– Apply to both goods and services
– Set by customers
– Government regulations.

5. 5.2 Exploring definitions of quality
• Highly perceptual & value driven
• No set definition
• Quality can be defined in terms of:
– fitness for use
– conformance to requirements e.g. meets specification
– freedom from deficiencies
– Transcendentally – something intuitive but impossible
to communicate e.g. Beauty of love, greatness etc.
– a system e.g. ISO9000
– Culturally e.g. management style, work practices etc.
– Judgmentally – what customer says it is
– Value – more benefits than the personal sacrifices
made to acquire

6. 5.2 Exploring definitions of quality
Quality dimensions for goods
– Performance – achieves intended purpose
– Features – “bells and whistles”
– Reliability – does it perform consistently?
– Conformance – specification within prescribed tolerances
– Durability – tolerates stress or trauma without failing
– Serviceability – ease of maintenance and repair
– Aesthetics – does it look, feel, taste…….good?
– Perceived quality – perceptions of different users
– Safety – does product protect users?
– Environmental friendliness – does product have a destructive
effect on natural resources?

7. 5.2 Exploring definitions of quality
Quality dimensions for services
– Tangibles – e.g.. Physical appearance of service
facility
– Reliability – is service delivered dependable and
accurately?
– Responsiveness – is service provider helpful and
prompt?
– Assurance – are employees knowledgeable and
courteous?
– Empathy – does service satisfy customers
requirement for caring and attentive service?

8. 5.2 Exploring definitions of quality
(cont.)
• Why has quality become a priority?
– Competition - globalisation
– The customer-focused organisation - loyalty
– Higher level of customer expectation – availability of
information, greater number of suppliers
– Performance improvement
– Change in the form of organisations
– Changing work force
– The information revolution
– The role of the ‘quality department’. Responsibility of
everyone!

9. 5.3 Gurus of quality
Deming
•Management of a system for improving quality
•Use of statistics for continual improvement
•World authority on quality management
•Large influence on American and Japanese industry
•Trained in engineering and mathematical physics
•His mantra “continual never-ending improvement”
QUALITY = JOURNEY WITHOUT A DESTINATION

10. 5.3 Gurus of quality
• Deming’s14 points

11. DEMING’S 14 POINTS
1.Create constancy of purpose
• Organisations exist not just to make money
• Also exist to serve customers and employees
• Must have strategic plans
• Clear vision and mission
• Must be communicated throughout organisation
• Must invest in innovation, training, research
• Must commit resources over long term to ensure
completion of quality initiatives
QUALITY IMPROVEMENT LONGTERM

12. DEMING’S 14 POINTS
2. Adopt a new philosophy
•Customer centred approach
•Based on mutual co-operation between management and
work force
•Everyone is engaged in continual improvement
•Reduction in defects improvement in
satisfaction
•Specification measurement customer service
measures of quality

13. DEMING’S 14 POINTS
3. Cease mass inspection
•Routine inspection does not add value
•Inspector responsible for detecting defects – no everyone
is responsible
•Increase in cost
•Decrease in productivity
•Instill quality at source no requirement for mass
inspection
QUALITY IS NOT RESPONSIBILITY OF QUALITY
DEPARTMENT

14. DEMING’S 14 POINTS
4. Do not award business on price tags
•Traditionally purchasing decisions based on price not
quality
•Defective raw materials = defective final product
•Minimise number of suppliers
•Build trust and loyalty in long term relationship
MANY SUPPLIERS IMPROVED QUALITY
AND DECREASED COST

15. DEMING’S 14 POINTS
5. Constantly improve the system
•Improve constantly and forever
•Improve quality and productivity
•Thus constantly reduce cost
•Should occur in small increments
Poor performance of a system Poor management!

16. DEMING’S 14 POINTS
6. Institute training on the job
•Essential to have necessary training
•Training improves productivity and morale
•Training does not guarantee successful
implementation of a quality system

17. DEMING’S 14 POINTS
7. Improve leadership
•Key to improving quality
•Upper management MUST be involved for
wide ranging success
•Supervisors aim should be to help people,
machines, processes do a better job

18. DEMING’S 14 POINTS
8. Drive out fear
•Only way to work effectively
•Culture should encourage suggestions without fear of being
labelled “troublemaker”
•Should acknowledge and reward suggested improvements
•Japanese firms offer lifetime employment to overcome
fears!

19. DEMING’S 14 POINTS
9. Breakdown barriers between
department
•Must work as a team
•Eradicates production problems
•Work collectively to meet needs of customer
TEAMWORK ATTAIN
ORGANISATIONS GOALS AND
OBJECTIVES

20. DEMING’S 14 POINTS
10. Eliminate slogans
•Remove slogans asking for zero quality
defects etc.
•Cause adversarial relationships within
workforce

21. DEMING’S 14 POINTS
11. Eliminate work standards
•Once work standards met continual
improvement stops?

22. DEMING’S 14 POINTS
12. Remove barriers to pride
•Workers should be proud of quality work
•Supervisors role should be to ensure
quality not manage numbers
•Casual labour can be de-motivating
•Employees should feel trusted and able to
make decisions
•Performance appraisals are destructive??

23. DEMING’S 14 POINTS
13. Institute education and self help
•Culture should be one of learning
•Reinforce and reward learning
•Employees should strive to achieve their best
•Very motivational

24. DEMING’S 14 POINTS
14. Put everyone to work
•Everyone in organisation should be striving for
transformation
•Transformation is EVERYONE’S job
•A quality management system must therefore
include all workers in organisation

25. 5.3 Gurus of quality (cont.)
• Juran
• The Juran Trilogy:
– Planning – everything begins with this.
Meeting customers needs
– Control – manufactured to specification
– Improvement – investigation of problems,
identification of root causes. Implementation
of improvement

26. 5.3 Gurus of quality (cont.)
• Crosby
• Quality = source of profit
• 14 steps
• Page 121

27. 5.3 Gurus of quality (cont.)
• Ishikawa
• ‘Company wide quality control’
• 11 points
• Page 122

28. 5.4 Quality spheres
Figure 5.1.

29. QUALITY SPHERES
QUALITY CONTROL
•Deciding what to measure
•Implementing a measurement system
•Measuring the selected parameters
•Comparing the measurements with a
standard
•Taking necessary corrective action if
deviation from standard

30. QUALITY CONTROL

31. QUALITY CONTROL

32. QUALITY SPHERES
QUALITY ASSURANCE
Provision of evidence to establish confidence in a product.
Used to show that:-
•Product fit for purpose and safe to use
•Product meets legal, professional and industrial standards
and regulations
•Product conforms to customer requirements
•Procedures are adequate and being adhered to
•All concerned parties are aware of quality requirements
•Corrective action is taken as appropriate
•Improvement opportunities are identified and implemented

33. QUALITY SPHERES
QUALITY MANAGEMENT
•Planning and implementing quality
•Creating an organizational culture that promotes
quality
•Planning and providing resources for
implementation and maintenance of quality
•Motivating and rewarding employees
•Ensuring suppliers are meeting quality standards
required

34. 5.5 Quality contributions from other
disciplines
• Financial perspective
• Human resources perspective
• Engineering perspective.

35. 5.6 Costs of quality
• Internal costs: • External costs
– Incurred before – Occur post delivery
delivery
– Types:
• Prevention costs
• Appraisal costs
• Internal failure costs i.e.
rework

36. 5.7 Quality management systems
• What is ISO 9000?
• Series of standards
• European
• Most recent - ISO 9000:2000
• Focuses on 8 principles of quality
management

37. 5.7 Quality management systems
(cont.)
• 8 principles of quality management:
– 1 Customer-focused organisation
– 2 Leadership
– 3 Involvement of people.
– 4 Process approach.
– 5 Systems approach to management.
– 6 Continual improvement.
– 7 Factual approach to decision making,
whereby effective decisions are based on the
analysis of data and information.
– 8 Mutually beneficial supplier relationships

38. 5.7 Quality management systems
(cont.).
• Certification
• Registration
• Motivational or demotivational?
Advantages/disadvantages. P129

39. 5.7 Quality management systems
(cont.)
• ISO 9000:2000
• Three standards:
– Fundamentals and vocabulary
– Requirements
– Guidelines for performance improvement
– Also:
• ISO 14000: Environmental standards
• OHSAS: Safety standards
• ISO 22000: Food safety standard

40. ISO 9000 QUALITY STANDARDS

41. ISO 9000 QUALITY STANDARDS

42. 5.8 Quality awards
• Malcolm Baldrige National Quality
Award [MBNQA]
• Deming prize for quality
• European Quality Award [EQA].

43. 5.9 South African quality
organisations
• SABS – South African Bureau of Standards
• SAQI – South African Quality Institute
• SASQ – South African Society for Quality
• SAACTA. – South African Auditors and
Certification Training Association

44. Summary
• Foundational knowledge regarding ‘quality’
• Definitions
• Dimensions
• Reasons for quality as a priority
• Gurus
• Standards and quality management
• Awards
• SA quality organisations.

45. NEXT SESSION
• Quality tools & techniques
• Essentially a workshop on quality tools
• Please bring:-
• Your brains!
• Calculator
• Graph paper
• Pencil
• Eraser
• Ruler