Chapter 6 - Quality Management

System

Quality is important to safeguard the company's reputation,

prevent products from being unreliable, and increase trust on
the side of consumers.
 What are the needs for
Quality
1. Meeting the expectations of the customers
2. Gaining competitive advantage
3. Quality is crucial for the satisfaction of customers
4. Quality develops reputation
5. Influence on sales volume
6. Quality helps in managing costs effectively
7. Greater productivity levels
8. Boosted brand value
9. Reduced risk
Evolution of Quality
 Quality Definitions
1. the standard of something as measured against other things of
a similar kind; the degree of excellence of something
2. a distinctive attribute or characteristic possessed by someone
or something
3. Quality is the degree to which an object or entity (e.g.,
process, product, or service) satisfies a specified set of
attributes or requirements.
4. Quality is the price consumers are willing to pay for a product
or service.
5. Quality means “Performance upon expectations” and “fit for
functions.”
Dimensions of Product
and Service Quality
 Six Sigma
Six Sigma is a process that makes use of statistics and data
analysis to analyze and reduce errors or defects. In this
process, the purpose is to improve cycle times while reducing
manufacturing defects to no more than 3.4 defects per million
units or events.
 What is Six Sigma
• Six Sigma is a method that offers organizations tools to improve
their capabilities in managing their businesses.
• This increase in performance and decreasing process variation, it
is possible to reduce defect rates, improve employee morale, and
improve the quality of products or services, which all contribute
to a higher level of profitability.
• Six Sigma is a set of management tools and techniques designed
to improve the capability of the business process by reducing the
likelihood of error.
• Six sigma is a data-driven approach that uses a statistical
methodology for eliminating defects, defect reduction and profits
improvement.
 The Six Sigma
Methodology
The two main Six Sigma methodologies are

DMAIC

DMADV

Each has its own set of recommended procedures to be

implemented for business transformation.
 DMAIC
DMAIC is a data-driven method used to improve existing products
or services for better customer satisfaction.
It is the acronym for the five phases:
D – Define,
M – Measure,
A – Analyze,
I – Improve,
C – Control.

DMAIC is applied in the manufacturing of a product or delivery of a

service.
 DMADV
DMADV is a part of the Design for Six Sigma (DFSS) process used
to design or re-design different processes of product
manufacturing or service delivery.
The five phases of DMADV are:
D – Define,
M – Measure,
A – Analyse,
D – Design,
V – Validate.

DMADV is employed when existing processes do not meet

customer conditions, even after optimization, or when it is required
to develop new methods.
 Difference between DMAIC and
DMADV
•DMAIC addresses the current process; DMADV addresses the
design process.
•DMAIC reduces/eliminates defects (reactive); DMADV prevents
defects (proactive).
•DMAIC includes specific solutions; DMADV is part of the
solution design process.
•DMAIC includes controls to sustain the gains; DMADV includes
verification and validation of the finished design.
• DMAIC and DMADV provide a structured process for
improvement.
• When applied properly with the applicable improvement
tools, they can help ensure the success of your projects,
 Six Sigma applications in Service
Industry
Six Sigma helps in improving on lots of processes like generating business
expansion, improving customer service, and gaining knowledge about service
sectors business processes.
Six Sigma also helps to improve the processes involved with human
resources, marketing, and sales.
Three principles of statistical thinking are required to be applied across service
industries, which are namely – all work is a process, all processes have
variability, and all processes create data that explains variability.
Using the DMAIC methodology, Six Sigma helps in implementing quality in any
industry by reducing defects. The defects are first identified, data is collected
as to how the defects occur, and then a new method of working is
implemented to reduce errors in the future.
This methodology has helped various financial sectors, insurance companies,
educational institutes, management companies, state agencies, and high-tech
companies to improve their quality.
Six Sigma applications in IT
industry
• Process improvement is vital in an information
technology business.
• In most IT companies, Six Sigma is being implemented in
the core processes, such as product development and
maintenance.
• Bugs and errors can easily increase costs. Six Sigma
helps by eliminating errors during the product
development process, which reduces the chance that the
product will not meet the client needs and requirements.
• Many IT companies that have successfully deployed Six
Sigma are seeing the benefits of reduced product
redevelopment and a drastic improvement in the
 Bench Marking
Benchmarking is a process of measuring the performance of a
company's products, services, or processes against those of
another business considered to be the best in the industry,
aka “best in class.” The point of benchmarking is to identify
internal opportunities for improvement.
 Key reasons for bench
marking
1. Get a true picture of business performance

2. Identify strengths and weaknesses

3. View the business objectively

4. Drive employee productivity

5. Understand the true value of the business

 1. Get a true picture of business
performance
 By analysing a business against competitors in the same industry,
business owners gain clear insights if their financial results (e.g. net
profit, revenue) are ‘good’ or ‘need improving.’
 Further, each industry has unique business performance metrics so it’s
important to ensure the metrics measured are relevant.
 For example, an accommodation business may be focused on
occupancy rates and costs of consumables. Whereas an accounting
firm may be more concerned with employee output and fixed costs.
 2. Identify strengths and
weaknesses
• A key reason for benchmarking is to identify the strengths and
weaknesses of the business.
• Without this insight, managers can be caught out traveling
blind and making business decisions without the right
information.
• Knowing where there is the most opportunity for improvement
can support business owners and advisors set clear objectives
and develop a strong strategic plan.
 3. View the business objectively
• One of the most important reasons for benchmarking is to show an owner
their true business performance.
• It is often difficult for business owners to take an objective view of their
business.
• They may be too close and emotionally invested in the business, making it
difficult to stand back and be unbiased.
• Benchmarking offers a reflection of where the business is against
competitors, enabling the business owners to see their position in the
market.
• This enables them to make realistic assessments about their performance
and implement plans for the future.
 4. Drive employee
productivity
 Benchmarking empowers you to understand personnel productivity in
detail, and subsequently, set reasonable expectations for staff
productivity.
 There’s no benefit in setting expectations that simply can’t be met by
humans.
 Likewise, it can be detrimental to set expectations that are too low to
drive real value or inspire staff.
 Comparing staff productivity to competitors will help identify
productivity gaps and drive productivity improvements.
 5. Understand the true value
of the business
 Knowing what a business is worth can support business owners
make short and long-term decisions.
 By undertaking benchmarking, business owners can delve into what
their business value is, as well as how to increase their value to
meet their long-term objectives.
 What is FMEA?
 Failure Mode and Effects Analysis (FMEA) is a
proactive method of uncovering potential failures in
business processes in order to prevent them from
happening or mitigate their effect by finding out
where they might occur and determining their
impact.
 FMEA’s systematic approach to identifying and
addressing causes of failures can help prevent
costly manufacturing issues, improve product quality
and service reliability, as well as increase customer
First Part: Failure Modes or those failures, issues, problems, or errors that occur within processes,
satisfaction.
products, or services
Second Part: Effects Analysis pertains to the part where the effects or consequences of the failures are
determined and analyzed
 Types of FMEA
 Design FMEA (DFMEA)

 Process FMEA (PFMEA)

 Functional FMEA (FFMEA) / System FMEA (SFMEA)

 Software FMEA
Steps of FMEA
 Step 1: Planning & Preparation
In Planning & Preparation, the team defines the purpose and definition
of the scope, sets boundaries of the analysis (what needs to be included
or excluded), and establishes the foundation for the entire FMEA
process.
Step 2: Structure Analysis
In Structure Analysis, the system structure is further clarified for technical analysis.
The boundaries set up in Planning & Preparation are analyzed to identify which
systems, sub-systems, and/or components will be part of the FMEA.
Additional tools to support the Structure Analysis are provided such as a structure
tree, block diagram, boundary diagram, flow diagram, or other visualization tools.
 Step 3: Function Analysis
In Function Analysis, the product and process functions are explored as well
as the criteria on how to evaluate the performance of functions.
The system elements done in the Structure Analysis are individually
analyzed of its functions and corresponding requirements.

Step 4: Failure Analysis

In Failure Analysis, the team establishes a Failure Chain through the cause-and-
effect relationships.
 Step 5: Risk Analysis
In Risk Analysis, root cause analysis is estimated and prioritized by
evaluating these 3 categories:
Severity: How badly does this affect the customer?
Occurrence: How often will it happen?
Detection: How easy is it to detect?

Step 6: Optimization
 In Optimization, the team develops a plan of action to mitigate
risks and assess the effectiveness of the optimization actions.
 Actions are divided into 2 categories: prevention and detection.
 Assignments of responsibilities and deadlines are given.
 After actions have been performed, the team reviews the results
to rescore the risks.
 Step 7: Result Documentation
 In Results Documentation, the FMEA is summarized, documented,
and communicated to the team and stakeholders.
 The FMEA report includes summary of scope, identification of high-
risk failures, the corrective actions taken and their effectiveness, and
insights/plans for current and future processes.
 The results documentation is to summarize and communicate the
results of the FMEA activity.
Quality Function Deployment – An
Introduction
The average consumer today has a multitude of options
available to select from for similar products and services. Most
consumers make their selection based upon a general
perception of quality or value. Consumers typically want “the
most bang for their money”.
In order to remain competitive, organizations must determine
what is driving the consumer’s perception of value or quality in
a product or service. They must define which characteristics of
the products such as reliability, styling or performance form the
customer’s perception of quality and value.
Many successful organizations gather and integrate the Voice
of the Customer (VOC) into the design and manufacture of
their products. They actively design quality and customer
perceived value into their products and services. These
companies are utilizing a structured process to define their
customer’s wants and needs and transforming them into
 What is QFD?
• Quality Function Deployment (QFD) is a process and set of tools
used to effectively define customer requirements and convert
them into detailed engineering specifications and plans to
produce the products that fulfill those requirements.
• QFD is used to translate customer requirements (or VOC) into
measurable design targets and drive them from the assembly
level down through the sub-assembly, component and
production process levels.
• QFD methodology provides a defined set of matrices utilized to
facilitate this progression.
QFD was first developed in Japan by Yoji Akao in the late 1960s while working for Mitsubishi’s shipyard. It was
later adopted by other companies including Toyota and its supply chain. In the early 1980s, QFD was
introduced in the United States mainly by the big three automotive companies and a few electronics
manufacturers. Acceptance and growth of the use of QFD in the US was initially rather slow but has since
gained popularity and is currently being used in manufacturing, healthcare and service organizations.
 Why Implement Quality Function
Deployment?
• Effective communication is one of the most important and
impactful aspects of any organization’s success.
• QFD methodology effectively communicates customer needs
to multiple business operations throughout the organization
including design, quality, manufacturing, production,
marketing and sales.
• This effective communication of the Voice of the Customer
allows the entire organization to work together and produce
products with high levels of customer perceived value.
 How to Implement Quality Function
Deployment?
The Quality Function Deployment methodology is a 4-phase
process that encompasses activities throughout the product
development cycle. The four phases of QFD are:
1.Product Definition

2.Product Development

3.Process Development

4.Process Quality Control

 Taguchi Quality loss
function

The quality loss function as defined by Taguchi is the loss

imparted to the society by the product from the time the
product is designed to the time it is shipped to the customer.
Societal losses include failure to meet customer requirements,
failure to meet ideal performance and harmful side effects.
The three quality loss
functions
1. Nominal - the - best

2. Smaller - the - better

3. Larger - the – better

NOMINAL – THE – BEST
The quadratic function is
shown in figure. In this
situation, the loss occurs as
soon as the performance
characteristic, y, departs
from the target τ.

At τ, the loss is Rs. 0.

At LSL (or) USL, the loss is

OMR A.
SMALLER – THE – BETTER
The target value
for smaller – the – better i
s 0. There are no negative
values for the performance
characteristic.

The radiation leakage from

a microwave appliance, the
response time for a
computer, pollution from
an automobile, out of round
for a hole etc. are the
performance characteristics
for this concept.
LARGER – THE – BETTER
In the
Larger – the – better
concept, the target
value is ∞
(infinity), which
gives a zero loss.
There are no
negative values and
the worst case is at
 TPM
Total Productive Maintenance
 TPM
TPM (Total Productive Maintenance) is a holistic approach to
equipment maintenance that strives to achieve perfect production:
•No Breakdowns
•No Small Stops or Slow Running
•No Defects
In addition it values a safe working environment:
•No Accidents
TPM emphasizes proactive and preventative maintenance to
maximize the operational efficiency of equipment.
It blurs the distinction between the roles of production and
maintenance by placing a strong emphasis on empowering operators
to help maintain their equipment.
The 5S principles
Sort, Straighten, Shine, Standardize, Sustain
 5S – The origin and
meaning
5S originated as 5 Japanese words: Seiri, Seiton,
Seisou, Seiketsu, and Shitsuke. In English these
have come to be known as:
•Sort: Eliminate that which is not needed.
•Straighten: Organize what remains after sorting.
•Shine: Clean and inspect the work area.
•Standardize: Write standards for 5S.
•Sustain: Consistently apply the 5S
standards.