Operations Notes – Quality


Notes from core MBA Operations class, these focused on quality.
Subject: Operations

Quality is a multi-faceted concept. It is not a constraint but an objective that needs to be continuously improved.

Key Quality Contributors

  • W.E. Deming and Shewart (Statistical Process Control – SPC)
  • J. Juran (Strategic Quality Management, Cost of Quality)
  • P. Crosby (Top Management Involvement, “Quality is Free”)
  • G. Taguchi (Designing Quality In)

Common and Special Causes of Variation in Quality

  • Common causes are from a combination of small, purely random fluctuations. These are common to everyone in the system and are inherently a part of the process
    • responsibility of management
  • Special causes arise from specific circumstances
    • can be responsibility of workers or management
  • Use Control Charts to determine if problem is common or special
    • if process measurements fall within control limits and doesn’t fall on one side of the limit too often (no “runs”), it is said to be in statistical control – only common causes afflict the process (stable)
    • If a measurement falls outside the control limit, then with a high degree of probability, it’s a special cause that must be investigated.

Capability is meeting customer specifications – a large % of data points must fall within specification limits

Process capability index (Cp) is given by: Cp = USL – LSL

If Cp = 1 then you have a 3-sigma process; If Cp = 2 you have a six-sigma process (0.002 defects per million)

Total Quality Management (TQM)

  • Customer satisfaction, a must for long-term success, arises from consistently meeting/exceeding customer expectations.
  • Processes focus is preferred to “individual focus”
  • Processes must be optimized, standardized, and documented.
  • Decisions are better left to workers closer to the customer.

TQM Plan, Do, Check, Act (PDCA) Cycle

Step 1 – Analyze Situation
Step 2 – Develop Solution
Step 3 – Develop Action Plan
Step 4 – Implement & Evaluate

Key Take-Aways

  • Quality attitudes should not be defensive.
  • Quality can be a competitive weapon.
  • A capable process is one whose variability is significantly smaller than customer specified variability limits. Six-sigma programs attempt to accomplish this.
  • Due to assembly stackups, quality of a composite system is significantly less than the quality of its components.
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