TOTAL

QUALITY
MANAGEMENT
CHAPTER 1: INTRODUTION TO QUALITY
What is Quality?
 Traditional thinking would say that Quality is conference to specifications,that is
does the product do what it designed to do?
 One is Quality Assurance which is the "prevention of defects", such as the
deployment of a Quality Management System and preventative activities like
FMEA.
 The other is Quality Control which is the "detection of defects", most commonly
associated with testing which takes place within a Quality Management System
typically referred to as Verification and Validation.
 "Conformance to requirements". The difficulty with this is that the requirements
may not fully represent what the customer wants; Crosby treats this as a separate
problem.
 "Fitness for use". Fitness is defined by the customer.
 A two-dimensional model of quality. The quality has two dimensions: "must-be
quality" and "attractive quality". The former is near to the "fitness for use"

Evolution of Quality Management

1. The Industrial Revolution
-changed how products were made and who was responsible for quality
management.
-quality is not determined by the people who make the product but by the
engineers and managers who created the processes.
2. The Japanese Quality Revolution
- They focused on defect prevention (and not inspection).
- quality became everyone’s responsibility.
- all levels of management were trained on the new quality initiatives.

Quality-What it stands for?

Q: Quest for Excellence
U: Understanding Customer needs
A: Action to achieve customers appreciation
L: Leadership Determination to be leader.
I: Involving all people
T: Team spirit to work for common goal
Y : Yard stick measure progress
-Quality means staying in business

Quality Definitions
Garvin’s Definitions of Quality
Manufacturing Based Definition
 If the product conforms to design specifications, it has good quality.
Value-Based Definition
 If the product is perceived as providing good value for the price, it has good
quality.
 Transcendent Definition
 Quality is something that is intuitively understood but nearly impossible to
communicate such as beauty or love.
 Product-Based Definition
 Quality is found in the components and attributes of a product.
 User-Based Definition
 If the customer is satisfied, the product has good quality.

Quality is defined as:

•The ability of product or services to meet customer needs.
•The totality of features and characteristics of a product or services that bears on its
ability to satisfy stated or implied needs.
•Meeting or exceeding Customer requirements now and in future.

Other definitions of Quality are:

•Quality is a measure of how closely a goods or service confirms to specified
standards or specifications
•Quality is meeting or exceeding customers requirement.
•Quality can be described as doing right things,right time ,first time & every time
•Quality is a means to an end

Service Quality is determined by:

•Reliability
•Responsiveness
•Competence
•Access
•Communication
•Courtesy
•Security
•Understanding
•Tangibles

Quality Dimensions
1. Performance Refers to the efficiency with which a product achieves its
intended purpose.
2. Features Attributes of a product that supplement a product’s basic performance.
3. Reliability The propensity for a product to perform consistently over its useful
design life.
4. Conformance Numerical dimensions for a product’s performance, such as
capacity, speed, size, durability, color, or the like.
5. Durability The degree to which a product tolerates stress or trauma without
failing.
6. Serviceability-Ease of repair.
7. Aesthetics-Subjective sensory characteristics such as taste, feel, sound, look, and
smell.
8. Perceived Quality-Based on customer opinion. Customers imbue products and
services with their understanding of their goodness.Cont
9. Include the physical appearance of the service facility, the equipment, the
personnel, and the communication material.
10. Service Reliability-Differs from product reliability in that it relates to the ability
of the service provider to perform the promised service dependably and
accurately.
11. Responsiveness-The willingness of the service provider to be helpful and
prompt in providing service.
Types of Quality
Indifferent Quality:That customer does not notice
Expected Quality:Is the quality that customer expects
One dimensional Quality:is the quality the customer expects but that does not
necessarily result in lots of order
Exiting Quality is the quality that exceeds customer requirements

Customer driven Quality

Quality is meeting or exceeding customer expectations.
•Directing attention toward satisfying and delivering value to the customer.
•Tools for Influencing Customer Perceptions of Quality
•Price and advertising are the primary tools for influencing customer perceptions of
quality, but are imperfect mechanisms.

Quality in production Systems

 Production is the process of converting the resources available to an organization
into products Goods & services.

Three levels of Quality

1 Organizational Level
At organizational level ,quality concerns center ton meeting external customer
requirements
2. At process level
Organizational units are classified as functions or departments such as marketing
design,product
3.Performance level(Job level) These standards include requirements for
accuracy,completeness

Determinants of Quality
Several activities are necessary to achieve Quality they are:
 Quality of Design
 Quality capability of production processes
 Quality of conformance
 Quality of customer service
 OrganizationQuality culture

Quality & competitive advantage

 One of the critical drivers of business success is having a unique competitive
advantage.
 Most managers understand that to attract a larger share of the market, or find
enough customers prepared to pay a premium price, they must provide
something of greater value than their competition.

Quality & Profitability

Good Quality can also pay off in higher profits Several research studies undertaken
by PIMS have found that:
•Product Quality is important determinant of business profitability
•Business that offer premium quality & services have large market shares
•Quality is positively and significantly related to a high return
•High Quality producers can usually change premium price

Quality and personal values

 Today companies are asking employees to take more responsibility for acting as
the point of contact between the organization and the customer,to be team
players & to provide more effective & efficient customer service.
 Personal Quality may be thought of as personal empowerment.
 Personal Quality is an essential ingredient to make quality happens at work place

Quality Drives the productive Machine

Japanese manufactures are credited with populating the notion that quality drives the
productivity machine.
 This means If the production does it right first time, & produces product and
services which are defect free, Waste is eliminated & costs are reduced.
 Productivity & Quality are often closely related
 Poor quality can adversely affected if defective parts are reworked.
 Poor quality tolls & equipment can lead to injuries and defective output.

ACTIVITY 1
Direction: Answer the following questions below.
1. What is the importance of achieving quality in a business concept?
2. Do you agree that quality can only perceived on the output being produced by a
company? Why?
3. Differentiate the industry revolution to Japanese quality revolution.
4. What is the relationship between quality and personal values? How does it affects
each other?

CHAPTER 2: Foundations of Quality Management

Deming Philosophy
The Deming philosophy focuses on continual improvements in product and
service quality by reducing uncertainty and variability in design, manufacturing, and
service processes, driven by the leadership of top management.

Deming’s 14 Points
1. Create and publish a company mission statement and commit to it.
2. Learn the new philosophy.
3. Understand the purpose of inspection.
4. End business practices driven by price alone.
5. Constantly improve system of production and service.
6. Institute training.
7. Teach and institute leadership.
8. Drive out fear and create trust.
9. Optimize team and individual efforts.
10. Eliminate exhortations for work force.
11. Eliminate numerical quotas and M.B.O. Focus on improvement.
12. Remove barriers that rob people of pride of workmanship.
13. Encourage education and self-improvement.
14. Take action to accomplish the transformation.

Deming’s System of Profound Knowledge

 Appreciation for a system
 Understanding variation
 Theory of knowledge
 Psychology

Systems
 Most organizational processes are cross-functional
 Parts of a system must work together
 Every system must have a purpose
 Management must optimize the system as a whole

Variation
 Many sources of uncontrollable variation exist in any process
 Excessive variation results in product failures, unhappy customers, and
unnecessary costs
 Statistical methods can be used to identify and quantify variation to help
understand it and lead to improvements

Theory of Knowledge
 Knowledge is not possible without theory
 Experience alone does not establish a theory, it only describes
 Theory shows cause-and-effect relationships that can be used for prediction

Psychology
 People are motivated intrinsically and extrinsically; intrinsic motivation is the
most powerful
 Fear is demotivating
 Managers should develop pride and joy in work

Juran Philosophy
 Juran proposed a simple definition of quality: “fitness for use.” This definition of
quality suggests that it should be viewed from both external and internal
perspectives; that is, quality is related to “(1) product performance that results in
customer satisfaction; (2) freedom from product deficiencies, which avoids
customer dissatisfaction.”

Crosby Philosophy
 “Quality is free . . .

... It’s not a gift, but it is free. What costs money are the unquality things -- all the
actions that involve not doing jobs right the first time.”
Crosby’s Absolutes of Quality Management
 Quality means conformance to requirements
 Problems are functional in nature
 There is no optimum level of defects
 Cost of quality is the only useful measurement
 Zero defects is the only performance standard

A.V. Feigenbaum
Three Steps to Quality
 Quality Leadership, with a strong focus on planning
 Modern Quality Technology, involving the entire work force
 Organizational Commitment, supported by continuous training and
motivation

Kaoru Ishikawa
 Instrumental in developing Japanese quality strategy
 Influenced participative approaches involving all workers
 Advocated the use of simple visual tools and statistical techniques

Total Quality
1. Principles – foundation of the philosophy
2. Practices – activities by which principles are implemented
3. Techniques – tools and approaches to make practices effective

ISO 9000:2000 Quality Management Principles

 Customer Focus
 Leadership
 Involvement of People
 Process Approach
 System Approach to Management
 Continual Improvement
 Factual Approach to Decision Making
 Mutually Beneficial Supplier Relationships

Statistical Thinking
 All work occurs in a system of interconnected processes
 Variation exists in all processes
 Understanding and reducing variation are the keys to success

Types of Variation
1. Uncontrollable variation (common causes) are a natural part of a process
2. Special (assignable) causes of variation can be recognized and controlled
3. Failure to understand these differences can increase variation in a system

Two Fundamental Management Mistakes

 Treating as a special cause any fault, complaint, mistake, breakdown, accident or
shortage when it actually is due to common causes
 Attributing to common causes any fault, complaint, mistake, breakdown, accident
or shortage when it actually is due to a special cause

Quality Management Systems

 Quality Management System (QMS) - a mechanism for managing and
continuously improving core processes to "achieve maximum customer
satisfaction at the lowest overall cost to the organization.”
Objectives
 Higher product conformity and less variation.
 Fewer defects, waste, rework, and human error.
 Improved productivity, efficiency, and effectiveness.

Quality Manual
A permanent reference for implementing and maintaining the system.
Typical records
 inspection reports
 test data
 audit reports
 calibration data

ISO 9000:2000 Objectives

1. Achieve, maintain, and seek to continuously improve product quality (including
services) in relationship to requirements.
2. Improve the quality of operations to continually meet customers’ and stakeholders’
stated and implied needs.
3. Provide confidence to internal management and other employees that quality
requirements are being fulfilled and that improvement is taking place.
4. Provide confidence to customers and other stakeholders that quality requirements
are being achieved in the delivered product.
5. Provide confidence that quality system requirements are fulfilled.

ISO 9000:2000 Documents

1. ISO 9000:2005—Fundamentals and vocabulary: This document provides
fundamental background information and establishes definitions of key terms used in
the standards.
2. ISO 9001:2008—Requirements: This is the core document that provides the
specific requirements for a quality management system to help organizations
consistently provide products that meet customer and other regulatory requirements.
3. ISO 9004:2009—Guidelines for Performance Improvements: This document
provides guidelines to assist organizations in improving and sustaining their quality
management systems.

Benefits of ISO 9000

 It provides discipline. The ISO 9001 requirement for audits forces an
organization to review its quality system on a routine basis.
 It contains the basics of a good quality system. These include understanding
customer requirements, ensuring the ability to meet them, ensuring people
resources capable of doing the work that affects quality, ensuring physical
resources and support services needed to meet product requirements, and
ensuring that problems are identified and corrected.
 It offers a marketing program. ISO certified organizations can use their status to
differentiate themselves in the eyes of customers.

ACTIVITY 2
Direction: Answer the following questions below in relevance to the topic being
discussed above.
1. What does ISO stands for?
2. Why do most of the companies struggles to be an ISO accredited?
3. Among the the leaders in the quality revolution that proposes different philosophy,
which among those philosophy is the most function nowadays in achieving good total
quality management? Explain why.
CHAPTER 3: TOTAL QUALITY MANAGEMENT
Quality for customer satisfaction means:
 Using customer’s perspective;
 Meeting or exceeding customer expectations;
 Anticipating future needs of the customer

Who is the Customer?

1) External Customer – one who purchases/uses the product or service, or one who
influences the sale of the product or service.
The external customer falls into 3 categories
the current, prospective and lost customer.
2) Internal customer – every person in a production process is considered a customer
of the preceding operation. Each worker’s goal is to make sure that the quality meets
the expectations of the next person.

Dealing with the Internal Customer

The formula for successful internal customer/ supplier relationships varies. But it
always begins with asking three basic questions.
 What do you need from me?
 What do you do with my output?
 Are there any gaps between what you need and what you get?

Customer Perception of Quality

Quality is judged by customers. Thus quality must take into account all product
and service features and characteristics that contribute value to customers and lead to
customer satisfaction, preference and retention.

The American Society for Quality (ASQ) surveys perceptions of important

factors:
1) Performance – fitness for use. Other considerations include (1) availability, which
is the probability that a product will be there when needed; (2) reliability, which is
freedom from failure over time; and (3) serviceability, which is the ease of keeping
the product operable.
2) Features (add-ons) – these may be physical, time-oriented, contractual, ethical or
technological.
3) Service – this is an intangible requirement by customers and may differentiate
between purchasing a service/product in one place relative to another – a way of
serving the customer better.
4) Warranty – it represents an organization's public promise of a quality product
backed up by a guarantee of customer satisfaction.
It also represents a public commitment to guarantee a level of service sufficient to
satisfy the customer.
5) Price – Today’s customer is willing to pay a higher price to obtain value. On-going
efforts must be made by everyone having contact with customers to identify, verify
and update each customer’s perception of value in relation each product and service.
6) Reputation – Total customer satisfaction is based on the entire experience with the
organisation.

Getting Customer Feedback/Collecting Customer Information

Feedback enables the organization to:
1. Discover customer dissatisfaction
2. Discover relative priorities of quality
3. Compare performance with competition
4. Identify customer needs
5. Determine opportunities for improvement

Ways of getting customer feedback/information

Comment card – to give feedback on a specific service/product
Report card – A quarterly report card could be sent to repeat customers.
Customer questionnaire – by mail, in person or via phone
Focus Groups – A group of customers is assembled in a meeting room to answer a
series of questions/discuss issues.
Customer visits – An organization can proactively monitor a product’s performance
while in use thereby identifying any specific or recurring problems.
Employee feedback – They can offer information and insights about conditions that
inhibit service quality, and can also brainstorm on ideas to address those problems.
Online feedback – Internet users can use given feedback online possibly on a
company’s website
Imprint analysis – Imprint refers to the collection of associations and emotions
unconsciously linked to a word, concept or experience.
Managers acting as customers – Managers can act as customers of their own
establishments in order to understand customer needs better.

Process vs. Customer

Customer complaints are often as a result of process variation.
From the company’s viewpoint, customer satisfaction is the result of a three-part
system: (1) company processes (operations); (2) company employees who deliver
consistent product or service and (3) customer expectations.

10 Key Excellence Indicators for Customer Satisfaction

1) Service standards derived from customer requirements
2) Understanding customer requirements Thoroughness/objectivity
Customer types
Product/service features
3) Frontline empowerment
4) Strategic infrastructure support for frontline employees
5) Attention to hiring, training, attitude, morale for frontline employees
6) High levels of satisfaction – customer awards
7) Proactive customer service systems
8) Proactive management of relationships with customer
9) Use of various listening posts: Surveys, product/service follow-ups, complaints,
turnover customers, employees
10) Quality requirements of market segments:
Surveys that go beyond current customers
Commitment to customer (trust/confidence/ making good on word)

ACTIVITY 3
Direction: Answer the following questions below based on the topi customer focus?
1. Why do companies should address quality in terms of the customer’s requirements?
2. Why do internal customers hold a big portion for a company in obtaining total
quality management?
3. Among the 10 key excellence indicators for customer satisfaction, choose at least
three and explain why these factors is important in achieving goals of a company in
terms of total quality management.

CHAPTER 4: WORKFORCE FOCUS

Workforce
 …everyone who is actively involved in accomplishing the work of an
organization. This encompasses paid employees as well as volunteers and
contract employees, and includes team leaders, supervisors, and managers at all
levels.
 Many companies refer to their employees as “associates” or “partners” to signify
the importance that people have in driving business performance.

Workforce Focus in ISO 9000

 Personnel performing work affecting product quality shall be competent on the
basis of appropriate education, training, skills, and experience.
 Organizations should determine the level of competence that employees need,
provide training or other means to ensure competency, evaluate the effectiveness
of training or other actions taken, ensure that employees are aware of how their
work contributes to quality objectives, and maintain appropriate records of
education, training, and experience.

Workforce Management
Workforce management (which has also been widely known as human resource
management, or HRM) consists of those activities designed to provide for and
coordinate the people of an organization.
1. determining the organization’s workforce needs;
2. assisting in the design of work systems;
3. recruiting, selecting, training and developing, counseling, motivating, and
rewarding employees;
4. handling other matters of employee well-being.

Strategic Human Resource Management

 … concerned with the contributions HR strategies make to organizational
effectiveness, and how these contributions are accomplished.
 It involves designing and implementing a set of internally consistent policies and
practices to ensure that an organization’s human capital (employees’ collective
knowledge, skills, and abilities) contributes to overall business objectives.

High Performance Work Culture

Performance - the extent to which an individual contributes to achieving the goals
and objectives of an organization.
High-performance work - work approaches used to systematically pursue ever-
higher levels of overall organizational and human performance.
Characterized by:
1. flexibility
2. innovation
3. knowledge and skill sharing
4. alignment with organizational directions, customer focus, and rapid response to
changing business needs and marketplace requirements

“Conditions of Collaboration” in a High Performance Work Culture

 Respect
 Aligned values
 Shared purpose
 Communication
 Trust

Workforce Engagement
… the extent of workforce commitment, both emotional and intellectual, to
accomplishing the work, mission, and vision of the organization.

Advantages of Workforce Engagement

 Replaces the adversarial mentality with trust and cooperation
 Develops the skills and leadership capability of individuals, creating a sense of
mission and fostering trust
 Increases employee morale and commitment to the organization
 Fosters creativity and innovation, the source of competitive advantage
 Helps people understand quality principles and instills these principles into the
corporate culture
 Allows employees to solve problems at the source immediately
 Improves quality and productivity

Employee Involvement (EI)

Any activity by which employees participate in work-related decisions and
improvement activities, with the objectives of tapping the creative energies of all
employees and improving their motivation.

Work and Job Design

Work design refers to how employees are organized in formal and informal
units, such as departments and teams.
Job design refers to responsibilities and tasks assigned to individuals.

Enhancing Work Design

1. Job enlargement – expanding workers’ jobs
2. Job rotation – having workers learn several tasks and rotate among them
3. Job enrichment – granting more authority, responsibility, and autonomy

Empowerment
Giving people authority to make decisions based on what they feel is right, to
have control over their work, to take risks and learn from mistakes, and to promote
change.

Successful Empowerment
 Provide education, resources, and encouragement
 Remove restrictive policies/procedures
 Foster an atmosphere of trust
 Share information freely
 Make work valuable
 Train managers in “hands-off” leadership
 Train employees in allowed latitude

Team - a small number of people with complementary skills who are committed to a
common purpose, set of performance goals, and approach for which they hold
themselves mutually accountable
Team Skill Requirements
 Conflict management and resolution
 Team management
 Leadership skills
 Decision making
 Communication
 Negotiation
 Cross-cultural training

Life Cycle of Teams

1. Forming takes place when the team is introduced, meets together, and explores
issues of their new assignment.
2. Storming occurs when team members disagree on team roles and challenge the
way that the team will function.
3. Norming takes place when the issues of the previous stage have been worked
out, and team members agree on roles, ground rules, and acceptable behavior
when doing the work of the team.
4. Performing characterizes the productive phase of the life cycle when team
members cooperate to solve problems and complete the goals of their assigned
work.
5. Adjourning is the phase in which the team wraps up the project, satisfactorily
completes its goals, and prepares to disband or move on to another project.

Ingredients for Successful Teams

 Clarity in team goals
 Improvement plan
 Clearly defined roles
 Clear communication
 Beneficial team behaviors
 Well-defined decision procedures
 Balanced participation
 Established ground rules
 Awareness of group process
 Use of scientific approach

Workforce Learning and Development

 Research indicates that companies that spend heavily on training their workers
outperform companies that spend considerably less, as measured on the basis of
overall stock market returns.
 Focus on both what people need to know as well as what things they need to
know how to do.
 Continual reinforcement of knowledge learned is essential.

Compensation and Recognition

Compensation and recognition refer to all aspects of pay and reward, including
promotions, bonuses, and recognition, either monetary and nonmonetary or individual
and group.
Compensation
 Merit versus capability/performance based plans
 Gainsharing
Recognition
 Monetary or non-monetary
 Formal or informal
 Individual or group

Effective Recognition and Reward Strategies

 Give both individual and team awards
 Involve everyone
 Tie rewards to quality
 Allow peers and customers to nominate and recognize superior performance
 Publicize extensively
 Make recognition fun

Performance Management
 How you are measured is how you perform!
Conventional performance appraisal systems
 Focus on short-term results and individual behavior; fail to deal with
uncontrollable factors
New approaches
 Focus on company goals such as quality and behaviors like teamwork
 360-degree feedback; mastery descriptions

Assessing Workforce Effectiveness, Satisfaction, and Engagement

Outcome Measures
number of teams, rate of growth, percentage of employees involved, number of
suggestions implemented, time taken to respond to suggestions, employee turnover,
absenteeism, and grievances; perceptions of teamwork and management effectiveness,
engagement, satisfaction, and empowerment.
Process Measures
number of suggestions that employees make, numbers of participants in project
teams, participation in educational programs, average time it takes to complete a
process improvement project, whether teams are getting better, smarter, and faster at
performing improvements, improvements in team selection and planning processes,
frequency of use of quality improvement tools, employee understanding of problem-
solving approaches, and senior management involvement

Gallup Engagement Index Classification

1. Engaged employees who work with passion and feel a profound connection to their
company. They drive innovation and move the organization forward.
2. Not-engaged employees who are essentially “checked out.” They are sleepwalking
through their workday. They are putting in time, but not enough energy or passion
into their work.
3. Actively disengaged employees who aren’t just unhappy at work; they’re busy
acting out their unhappiness. Every day, these workers undermine what their engaged
coworkers accomplish.

Sustaining High-Performance Work Systems

Regular assessment of:
 workforce capability and capacity needs;
 hiring, training and retention of employees; and
 career progression and succession planning

Workforce Capability and Capacity

Workforce capability refers to an organization’s ability to accomplish its work
processes through the knowledge, skills, abilities, and competencies of its people.
Workforce capacity refers to an organization’s ability to ensure sufficient
staffing levels to accomplish its work processes and successfully deliver products and
services to customers, including the ability to meet seasonal or varying demand levels.

Effective Hiring Practices

1. Determine key employee skills and competencies
2. Identify job candidates based on required skills and competencies
3. Screen job candidates to predict suitability and match to jobs

Succession Planning
 Formal processes to identify, develop, and position future leaders
 Mentoring, coaching, and job rotation
 Career paths and progression for all employees

ACTIVITY 4
Direction: DO the following statements below.
1. Research something about the workforce environment that Coca-Cola company
have.
2. As you search the background of the workforce environment of Coca-Cola
company, answer these following questions:
2.1 What can you say about the type of workforce does Coca-Cola company
have?
2.2 In what way does their workforce helps them to achieve a good quality
management especially in the production of their products?
2.3 What can you say about their strategy in terms of human and technology
processes that they have?

CHAPTER 5: PROCESS FOCUS

Process - a sequence of linked activities that is intended to achieve some result, such
as producing a good or service for a customer within or outside the organization.
 Generally, process involve combinations of people, machines, tools, techniques,
materials, and improvements in a defined series of steps or actions.
 Common types of production processes include machining, mixing, assemble,
filling orders, or approving loans.
 A process perspective links together all necessary activities and increases one’s
understanding of the entire system, rather than focusing on only a small part.

Key Process-Focused Practices for Quality Management

 Identify vital work processes that relate to core competencies and deliver
customer value, profitability, organizational success, and sustainability
 Determine key work process requirements incorporating input from customers,
suppliers, partners, and collaborators
 Design and innovate work processes to meet all requirements, incorporating new
technology, organizational knowledge, product excellence, the need for agility,
cycle time reduction, productivity, cost control, and other efficiency and
effectiveness factors
 Seek ways to prevent defects, service errors, and rework and minimize costs
associated with inspections, tests, and process or performance audits

Process Management
Process management involves planning and administering the activities necessary
to achieve a high level of performance in key organizational processes and identifying
opportunities for improving quality and operational performance, and ultimately,
customer satisfaction. Process management consists of three major activities: design,
control and improvement.
 Design – focuses on ensuring that the inputs to the process, such as materials,
technology, work methods and a trained workforce are adequate and that the
process can achieve its requirements
 Control – focuses on maintaining consistency in output by assessing performance
and taking corrective action when necessary
 Improvement – focuses on continually seeking to achieve higher levels of
performance, such as reduced variations, higher yields, fewer defects and errors,
smaller cycle times, and so on.
Cycle time - refers to the time it takes to accomplish one cycle of a process
(e.g. the time from when a customer orders a product to the time that it is
delivered, or the total time needed to introduce a new product)
- one of the most important metrics in process management

Identifying Processes and Requirements

Nearly everything an organization does can be viewed as a process. Common
processes include acquiring customer and market knowledge, strategic planning,
research and development, purchasing, developing new products or services,
manufacturing and assembly, fulfilling customer orders, managing information,
measuring and analyzing performance, and training employees, to name just a few.
Leading organizations identify important processes throughout the value chain that
affect their ability to deliver customer value. These processes typically fall into two
categories: value-creation processes and support processes.

Value-Creation Processes
 Value-creation processes (sometimes called core processes) are those most
important to “running the business” and maintaining or achieving a sustainable
competitive advantage.
 Value-creation processes frequently align closely to an organization’s core
competencies and strategic objectives. They derive the creation of products and
services, are critical to customer satisfaction, and have a major impact on the strategic
goals of an orgaization.
 Value-creation process typically include product design and production/delivery
processes.
 Product design processes involve all activities that are performed to incorporate
customer requirements, new technology, and organizational knowledge into the
functional specifications of a manufactured good or service.
 Production/delivery processes create or deliver the actual product.

Support Processes
Support processes are those that are most important to an organization’s value-
creation processes, employees, and daily operations. They provide infrastructure for
value-creation processes, but generally do not add value directly to the product or
service.
Support processes might include processes for finance and accounting, facilities
management, legal services, human resource services, public relations, and other
administrative services. In a school system, for example, support processes might
include transportation, custodial, central stores, information technology, and
maintenance.

Process Requirements
 In general, value-creation process requirements are driven by consumer or
external customer needs. For example, if hotel customers expect fast, error-free
check-in, then the check-in process must be designed for speed and accuracy.
 Support process requirements, on the other hand, are driven by internal customer
needs and must be aligned with the needs of key value-creation processes. For
example, information technology processes at a hotel must support the check-in
process requirements of speed and accuracy, this would require real-time
information on room availability.

Process Design
 The goal of process design is to develop an efficient process that satisfies both
internal and external customer requirements and is capable of achieving the
requisite level of quality and performance.
 Technology – an integral part of process design that makes today’s service and
manufacturing processes operate productively and meet customer needs better
than ever.
Process Mapping
Process map – or flowchart, used to develop in order to describe the specific steps
in a process and their sequence

Poka-yoke (POH-kah YOH-kay)

An approach for mistake-proofing process using automatic devise or simple
methods to avoid human errors or remove human element completely.
Two aspects are:
1. Prediction, or recognizing that a defect is about to occur and providing a
warning.
2. Detection, or recognizing that a defect has occurred and stopping the process.

Typical types of Service Errors

 Task Errors – doing work incorrectly, like work on wrong order.
 Treatment errors – arise in the contact between the server and customer, such as
failure to acknowledge or listen.
 Tangible errors – those in physical elements of service, such as dirty uniforms or
document errors.
 Customer errors in preparation – the failure to bring necessary materials to the
encounter.
 Customer errors during an encounter – failure to remember steps or follow
instruction to the process.
 Customer errors at the resolution stage of service – failure to signal inadequacies,
to learn from experience, to execute appropriate post-encounter actions.

 Control is the activity of ensuring conformance to the requirements and taking

corrective action when necessary to correct problems and maintain stable
performance.
 Process control is the responsibility of those who directly accomplish the work
 Control should be the foundation for organizational learning

Process Improvement
Continuous Improvement – refers to both incremental changes, which are small and
gradual, and breakthrough improvements, which are large and rapid. Continuous
improvement is one of the foundation principles of total quality.
It is an important business strategy in competitive markets because:
 Customer loyalty is driven by delivered value
 Delivered value is created by business processes
 Sustained success in competitive markets requires a business to continuously
improve delivered value
 To continuously improve value-creation ability, a business must continuously
improve its value-creation processes

Kaizen
A philosophy of improvement.
 It means gradual and orderly continues improvement.
 Kaizen Institute, suggest some basic tips in implementing kaizen, such as
discarding conventional fixed ideas; thinking of how to do something; not making
excuses and seeking the “wisdom of ten people rather than the acknowledge of
one”.
One important area for improvement is reducing cycle time. Reductions in cycle
time served two purposes:
 First, they speed up work processes so that customer response is improved
 Second, reductions in cycle time can only be accomplished by streamlining and
simplifying processes to eliminate non-value added steps such as rework
This approach forces improvements in quality by reducing the potential for
mistakes and errors. By reducing non-value added steps, costs are reduced as well.

Breakthrough improvement – refers to discontinuous change, as opposed to the

gradual continuous improvement philosophy.
Breakthrough improvements result from innovative and creative thinking; often
these are motivated by stretch goals or breakthrough objectives.
Stretch goals – force an organization to think in a radically different way and to
encourage major improvements as well as incremental ones. When a goal of 10
percent improvement is set, managers or engineers can usually meet it with some
minor improvements. However, when the goal is 1,000 percent improvement,
employees must be creative and think “outside the box.”
Two approaches for breakthrough improvement that help companies achieve
stretch goals are benchmarking and reengineering.

 Benchmarking – defined as “measuring your performance against that of best-

in-class companies, determining how the best-in-class achieve those performance
levels and using the information as a basis for your own company’s targets,
strategies and implementation” or more simply, “the search of industry best
practices that lead to superior performance”.
 The term “best practices”refers to approaches that produce exceptional
results, are usually innovative in terms of the use of technology or human
resources, and are recognized by customers and industry experts.
Competitive benchmarking – studying products or business results against
competitors to compare pricing, technical quality, features and other quality or
performance characteristics.
Process benchmarking – identifies the most effective practices in key work
processes in organizations that perform similar functions, no matter in what industry.

Reengineering – is a systematic starting over and reinventing the way a firm, or a

business process, gets its work done.

ACTIVITY 5
Direction: Answer the following questions below.
1. What is the implication of using benchmarking in conducting the operation of a
business?
2. In what way could reengineering improves the quality of the output being
produced?
3. How does quality is being achieve through a process control? Do you think that
even innovation can be applied through a process? Why?
CHAPTER 6: DESIGN FOR QUALITY AND
PRODUCT EXCELLENCE
Importance of Design
 Better designs reduce costs and improve quality. For example, simpler designs
have fewer components, which mean fewer points of failure and less chance of
assembly error.
 Many product failures and service upsets result form poor design or inadequate
design processes.

Product Development
1. Idea Generation: Develop concept incorporating customer needs and expectations.
2. Preliminary Concept Development: Study new ideas for feasibility.
3. Product/Process Development: Evaluate design alternatives and determining
engineering specifications; test prototypes; develop, test, and standardize processes.
4. Full-Scale Production: Release the product to manufacturing or service delivery
teams.
5. Market Introduction: Distribute to customers.
6. Market Evaluation: Market evaluation and customer feedback to initiate continuous
improvements.

Concurrent Engineering
is a process in which all major functions involved with bringing a product to
market are continuously involved with product development from conception through
sales.

Design for Six Sigma

Design for Six Sigma (DFSS) represents a structured approach to product
development and a set of tools and methodologies for ensuring that goods and
services will meet customer needs and achieve performance objectives, and that the
processes used to make and deliver them achieve high levels of quality.
 Concept development
 Detailed design
 Design optimization
 Design verification
These activities are often incorporated into a process, known as DMADV, which
stands for define, measure, analyze, design, and verify.
Concept Development and Innovation
Concept development is the process of applying scientific, engineering, and
business knowledge to produce a basic functional design that meets both customer
needs and manufacturing or service delivery requirements.
Innovation involves the adoption of an idea, process, technology, product, or
business model that is either new or new to its proposed application.
Innovation is built upon strong research and development (R&D) processes.

Detailed Design
Detailed design focuses on establishing technical requirements and specifications,
which represent the transition from a designer’s concept to a producible design, while
also ensuring that it can be produced economically, efficiently, and with high quality.
Axiomatic design is based on the premise that good design is governed by laws
similar to those in natural science.
1. Independence Axiom: good design occurs when the functional requirements of the
design are independent of one another.
2. Information Axiom: good design corresponds to minimum complexity.

Quality Function Deployment (QFD)

… is a planning process to guide the design, manufacturing, and marketing of goods
by integrating the voice of the customer throughout the organization.
Through QFD, every design, manufacturing, and control decision is made to meet
the expressed needs of customers.
QFD benefits companies through improved communication and teamwork
between all constituencies in the value chain, such as between marketing and design,
between design and manufacturing, and between manufacturing and quality control.

Target and Tolerance Design

Manufacturing specifications consist of nominal dimensions and tolerances.
Nominal refers to the ideal dimension or the target value that manufacturing seeks to
meet.
Tolerance is the permissible variation, recognizing the difficulty of meeting a target
consistently.

Tolerance Design
Tolerance design involves determining the permissible variation in a dimension.
 Narrow tolerances tend to raise manufacturing costs but they also increase the
interchangeability of parts within the plant and in the field, product performance,
durability, and appearance.
 Wide tolerances increase material utilization, machine throughput, and labor
productivity, but have a negative impact on product characteristics

Taguchi Loss Function

Taguchi measured quality as the variation from the target value of a design
specification, and then translated that variation into an economic “loss function” that
expresses the cost of variation in monetary terms. The loss function is a quadratic
function so that larger deviations from target correspond to increasingly larger losses.
Expected Loss
If the distribution of the variation about the target value is known, the average
loss per unit can be computed by finding the expected value of the loss using routine
expected value calculations.

Design for Reliability

Reliability is defined as the probability that a product, piece of equipment, or
system performs its intended function for a stated period of time under specified
operating conditions.
Key elements:
 Probability
 Time
 Performance
 Operating conditions

Types of Failures
Functional failure – failure that occurs at the start of product life due to manufacturing
or material detects
Reliability failure – failure after some period of use

Reliability Concepts
 Inherent reliability is the predicted reliability determined by the design of the
product or process.
 Achieved reliability is the actual reliability observed during use.
 Achieved reliability can be less than the inherent reliability due to the effects of
the manufacturing process and the conditions of use.

Design for Reliability

 Reliability requirements are determined during the product design phase.
 The designer may use these techniques to determine the effects of adding
redundancy, substituting different components, or reconfiguring the design.

Design Optimization
Robust design refers to designing goods and services that are insensitive to
variation in manufacturing processes and when consumers use them.
Robust design is facilitated by design of experiments to identify optimal levels
for nominal dimensions and other tools to minimize failures, reduce defects during the
manufacturing process, facilitate assembly and disassembly (for both the
manufacturer and the customer), and improve reliability.

DFMEA
Design failure mode and effects analysis (DFMEA) – identification of all the
ways in which a failure can occur, to estimate the effect and seriousness of the failure,
and to recommend corrective design actions.

Elements of DFMEA
 Failure modes
 Effect of the failure on the customer
 Severity, likelihood of occurrence, and detection rating
The severity rating is based on how serious the impact would be if the
potential failure were to occur. The occurrence rating is based on the probability
of the potential failure occurring. The detection rating is based on how easily the
potential failure could be detected prior to occurrence Based on these
assessments, a risk priority number (RPN) is calculated.
 Potential causes of failure
 Corrective actions or controls

Fault Tree Analysis

 Fault Tree Analysis (FTA), sometimes called cause and effect tree analysis, is a
method to describe combinations of conditions or events that can lead to a failure.
 A cause and effect tree is composed of conditions or events connected by “and”
gates and “or” gates.
 An effect with an “and” gate occurs only if all of the causes below it occur; an
effect with an “or” gate occurs whenever any of the causes occur.

Design for Manufacturability

DFM - the process of designing a product for efficient production at the highest level
of quality.
Example guidelines
1. Design for robustness
2. Minimize number of parts
3. Eliminate adjustments
4. Make assembly easy and foolproof
5. Use repeatable, well-understood processes
6. Choose parts that can survive process operations
7. Design for efficient and adequate testing
8. Lay out parts for reliable process completion
9. Eliminate engineering changes

Design and Environmental Responsibility

Design for Environment (DFE) - the explicit consideration of environmental
concerns during the design of products and processes, and includes such practices as
designing for recyclability and disassembly.
Design for Excellence
DFX - an emerging concept that includes many design-related initiatives such as
concurrent engineering, design for manufacturability, design for assembly, design for
environment, and other “design for” approaches
Principles
 Constantly thinking in terms of how one can design or manufacture products
better
 Focusing on “things done right” rather than “things gone wrong”
 Defining customer expectations and going beyond them
 Optimizing desirable features or results
 Minimizing the overall cost without compromising quality

Design Verification
Design Reviews
The purpose of a design review is to stimulate discussion, raise questions, and
generate new ideas and solutions to help designers anticipate problems before they
occur.
Reliability Testing
 Life testing – run devices until failure occurs
 Accelerated life testing – overstress devices to reduce time to failure
 Highly accelerated life testing - focused on discovering latent defects that would
not otherwise be found through conventional methods. For example, it might
expose products to rapid, extreme temperature changes in temperature chambers
that can move products between hot and cold zones to test thermal shock, or also
extreme vibrations.

ACTIVITY 6
Direction: Answer the following questions below:
1. Create a product development using the different concept of it starting from idea
generation up to market evaluation.