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CROSBY:“Don’t talk about poor quality or high quality. Talk about conformance andnon-conformance.”

FEIGENBAUM :"The total composite product and service characteristics of marketing,engineering, manufacturing and maintenance through which the product orservice in use will meet the expectations of the customer."

JURAN:"Quality is fitness for purpose or use.”

Definition of Quality

JURAN:"Quality is fitness for purpose or use.”

DEMINGSatisfying customer’s needs.

TAGUCHIThe loss which is imparted by the product or service to society from the timeis created.

Be aware: requirements, purpose or use means those of the CUSTOMER

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Managing Quality: GARVIN, D (1988)

1. the transcendent approach – a quality watch is a Rolex

2. the manufacturing based approach [free of errors, confirmingprecisely to design specs] – a watch though not the “best” availableis defined as a “quality” product provided it has been built ordelivered precisely to its design specs

3. the user-based approach [fit for its purpose] - a watch that ismanufactured precisely to its design specs yet fails to pieces aftermanufactured precisely to its design specs yet fails to pieces after2 days is clearly not “fit for its purpose”

4. the product-based approach [precise and measurable set ofcharacteristics] – a watch may be designed to run, without the needfor servicing, for at least 5 years while keeping time correct towithin 5 seconds

5. the value-based approach [cost & price] – compromise quality forprice

4Costs of Quality

Appraisal Costs

Costs ofExternal FailureCosts Prevention Costs

Internal FailureCosts

Costs ofQuality

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Prevention Costs: Costs incurred in preventing non-conformancefrom occurring

Quality Planning: Costs associated with the broad array of activities which collectivelycreate the overall quality plan, e.g. inspection plan, reliability plan,specialized plans, cost of preparing manuals and procedures

New Products review: Costs in evaluating new designs, preparation of tests, etcassociated with the launching of new products.

Training Programmes: Costs of preparing and conducting training programmes

Quality Costs

Training Programmes: Costs of preparing and conducting training programmes

Process Control: Costs associated with the time that personnel in the quality controlfunction spend studying and analyzing manufacturing processes.

Quality Data Acquisition Analysis: Costs for the analysis of the data to identifythe quality troubles, to sound the alarms, to stimulate study, etc

Quality Reporting: Costs for summarizing and publishing quality info to middle andupper management.

Improvement Projects: Costs for structuring and carrying out programmes for breakthru to new levels of performance, e.g. motivation programmes

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Internal Failure Costs: Costs of non-conformance, occurring before theproduct or service reaches the customer

Scrap: Net losses in labor and material i.e. product that can not be rework, sell, etc

Re-work: Cost of correcting defective items to make them fit for use

Retest: Costs of re-inspection and re-test of re-worked items

Downtime:

Quality Costs

Downtime: Costs of idle facilities resulting from defects

Yield losses: Costs of process yields lower than might be attainable by improvedcontrols, e.g. overfill of containers due to variability in filling andmeasuring equipment

Disposition: Costs of deciding what to do with non-conforming materials

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External Failure Costs: Costs resulting from the occurrence of non-conformance, which is not found before theproduct or service reaches the customer

Complaint Adjustment: Investigation and adjustment costs of justified complaintsattributable to defective product or installation

Returned Material: Costs associated with receipt and replacement of defectiveproduct returned from the field

Quality Costs

product returned from the field

Warranty Charges: Costs involved in service to customers under warranty contracts

Allowances: Costs of concessions made to customers due to sub-standardproducts, e.g. seconds, offers, etc

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Appraisal Costs: Costs of determining the quality of the products or services

Vendor Appraisal: Costs of assessing the vendor’s capability

Goods Inward Inspection: Costs of determining the quality of the arriving products

Inspection and Test: Costs inspection and testing thru its progression in the factory

Maintaining the Accuracy of Test Equipment: Costs for maintaining and calibratingmeasuring instruments and equipments

Quality Costs

measuring instruments and equipmentsMaterials and Services Consumed: Costs of materials and services thru the destructive

and non-destructive testing, e.x. X-rays, etcEvaluation of Stocks: Costs of testing products in field storage or in stock to evaluate

degradation

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•Important as they affect the company’s profitability

•Quality Costs range between 10 – 20 % of sales (1985 study)• Quality Costs range between 4– 20 % of sales (Montgomery,1996)

Quality Costs

Crosby recommends that a proper managed quality <2.5%sales (1979)

FEIGENBAUM’S 'HIDDEN PLANT‘15-40% of resources producing scrap, re-work, detectingdefects, replacing faulty products

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Reporting Quality Costs

• Customer complaints = 25,000

• Materials inspection = 20,000

• Process acceptance = 38,000

• Product acceptance = 10,000

• Quality training = 35,000• Quality training = 35,000

• Reliability engineering = 80,000

• Repair = 15,000

• Rework = 35,000

• Scrap = 50,000

• Warranty = 25,000

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Reporting Quality CostsQuality Costs %of Sales

Prevention costs:

Quality training $35,000

Reliability engineering 80,000 $115,000 4.11

Appraisal costs:

Materials inspection $20,000

Product acceptance 10,000Product acceptance 10,000

Process acceptance 38,000 68,000 2.43

Internal failure costs:

Scrap 50,000

Rework 35,000 85,000 3.04

External failure costs:

Customer complaints 25,000

Warranty 25,000

Repair 15,000 65,000 2.32

Total quality costs $333,000 11.90%

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The death certificate approach(Vonderembse & White)

Organization vulnerable tocompetition (good example UK in’60s & ’70s, where 95% of allcosts attributed to appraisal &failure and only 5% tofailure and only 5% topreventive vs. Japan)

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Total Quality Management (prevention)

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Features commonly found in TQM programmes- TOTAL means that the idea of continuous improvement applies to all

personnel (and not to QA or QC)- KAIZEN which refers to a concern for the quality of people’s lives and

focuses on improvements resulting from an EDLESS series of smallchanges, directed towards the elimination of waste in all its forms.

- CUSTOMER FOCUS

Total Quality Management (prevention)

- CUSTOMER FOCUS- external customer focus approach in quality (i.e. what the externalcustomer perceives as quality)- each individual is encouraged to identify his internal suppliers andcustomers

- TRAINING is a major feature in moving to a TQM culture (firstlychange the “mind-set” approach and then introduce the relevant toolsand techniques)

- LEADERSHIP “walk as you talk”

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start

process

TQM Tools & Techniques

Process flowcharts

finish

decision

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Check sheets

TQM Tools & Techniques

Machine type Monday Tuesday Wednesday Thursday Friday

Mega mixer | | | | | | | | | |

Flexi mixer | | | | | | | | |

Blender | | | | | | | |

Master blender | | | | | | | | | |

Conveyer | | | | | | | | | | |

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Possible causes: The resultsor effect

ManMachine

Ishikawa diagrams [Fish bone]

Effect

MaterialMethod

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Ishikawa diagrams [Fish bone]: Generating ideasExample: Exam failure

Student Lecturer

Wrong topic

Too many exams

Too tired Poor trainingWorkload

TQM Tools & Techniques

Examfailure

CourseMaterial

Examination

Too many exams

Too muchLevel too high

Questions unclear

NoiseToo hot

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InaccurateSubmission of

Billing to Client

Ignorance

Methods People

People fail to informclient thru call/e-mail

Erroneoussorting

of billingstatementsInvalid

list ofupdates

ErroneousInformation

Unreliablemail system

Informationin BIS

MaterialsMachinery

Phone linedisconnected

No file forrecord of billing

statementsin clients’

folders

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InaccurateSubmission of

Billing to Client

Methods People

Ignorance

People fail to informclient thrucall/e-mail

Erroneoussorting

of billingstatements

Invalidlist ofupdates

ErroneousInformation in BIS

Mixed updataInaccuracy

insortingdata

Manual fileorganization

Poortraining

Mixedup data

InaccuracyIn sorting

dataIgnorance

Wrong phone number/e-mail information Erroneous info

in BIS

Inaccuracy insorting data

Manual fileorganization

No training

Manual fileorganization

Skipping payingInaccuracy in

MaterialsMachinery

Unreliablemail systemPhone line

disconnectedAssorted records

of billingstatements

in clients’ folders

Skipping payingmonthly bills

Poortraining No

money

Inaccuracy in sortingand giving out mail

Manual file system

Mixedup data

Inaccuracy insorting data

Manual fileorganization

Mixedup data

Inaccuracy insorting data

Manual fileorganization

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Fishbone Diagram Example

Fishbone diagram sourced from GOAL/QPC Black Belt Memory Jogger published 2002

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Same Example More Detail

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Scatter diagrams

Scatter diagram (positive) Scatter diagram (none)

TQM Tools & Techniques

Little or no relationshipRelationship

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Control charts

TQM Tools & Techniques

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ISO 9000

REVESION: December 2000ISO 9000:2000ISO 9001: revised - coreISO 9004: revisedISO 9002: abandonedISO 9003: abandoned.

Quality Standards and Awards

• Revision changed from “procedure” focus to “business process” focus• Many of the themes of TQM were incorporated• The “voice of the customer” is an integral part of the standard• The 20 elements of the original standard have now been replaced by 4

sections:- management responsibility- resource management, product- service realization- measurement, analysis, improvement

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