1. Describe the TQM philosophy and identify its major characteristics.
TQM focuses on identifying the causes of quality problems and correcting these problems. TQM emphasizes the need to include every employee in the organization in the quality improvement efforts. TQM emphasizes the need to define quality based on the customer’s needs. Its major characteristics are customer focus, continuous improvement, and quality at the source, employee empowerment, understanding quality tools, and a team approach, benchmarking and managing supplier quality.
2. Explain how TQM is different from the traditional notions of quality. Also, explain the differences between traditional organizations and those that have implemented TQM.
Traditional notions of quality focused on inspection of products. Instead of relying on inspection as the primary tool for quality, TQM focuses on identifying the causes of quality problems and correcting these problems. TQM takes a broader view of the organization than traditional views of quality. Organizations that implemented TQM successfully were able to produce a higher quality product at a lower price, thereby increasing market share. Traditional organizations have either failed or will fail in the future if quality is poor.
3. Find three local companies that you believe exhibit high quality. Next find three national or international companies that are recognized for their quality achievements.
The selection of the local companies will depend on the location of the university utilizing this textbook. The Ritz-Carlton Hotel Company, a winner of the Malcolm Baldrige National Quality Award, is known for outstanding customer service. Its employees are trained well and are empowered to deal with quality problems on the spot. Florida Power & Light (FPL) was the first American company to win Japan’s Deming Prize, which is a prestigious quality award. FPL has created and used a process for identifying and dealing with quality problems that has been benchmarked by a number of companies. For example, FPL applied this process to the problem of service interruptions to determine the major causes. They made changes based on the analysis, such as moving power poles away from dangerous curves in the road to deal with one important cause (Florida Power Light Quality Improvement (Q1) Story Exercise (A), Harvard Business School Case 9-689-041). Disney is well-respected for its customer focus. Disney has theme parks in the U.S., Japan and Europe. Disney is known for its excellent training program and attention to details.
4. Describe the four dimensions of quality. Which do you think is most important?
The four dimensions of quality are the quality of product or service design, quality of conformance to design, ease of use and post-sales service. The quality of product or service design is determined by the features that are included in the final design of the product or service. The quality of conformance to design is the result of how well the product or service meets its specifications. Ease of use is determined by the ease of using the product or service, its reliability and its maintainability. Post-sales service is the level of service provided after the product or service has been purchased.
The four dimensions of quality are all important in determining quality. However, quality of design is most important since it determines the ability to meet customer needs, which is the objective. If the quality of design does not meet customer needs, then it will not matter if the product or service meets it design specifications, is easy to use or is supported by good post-sale service.
5. Describe each of the four costs of quality: prevention, appraisal, internal failure, and external failure. Next, describe how each type of cost would change (increase, decrease or remain the same) if we designed a higher quality product that was easier to manufacture.
Prevention costs are the costs associated with preventing poor quality, such as training, designing a quality product that is easy to manufacture and planning costs. Appraisal costs are the costs of determining the level of quality and finding defects. These costs include inspections, product testing and quality audits. Internal failure costs are the costs associated with finding and dealing with quality problems discovered before the product or service reaches the customer. Some examples of internal failure costs are rework, scrap and machine downtime due to quality problems. External failure costs are the costs of poor quality discovered by the customer. Some examples of external failure costs are product returns, lawsuits and repairs.
If we designed a higher quality product that was easier to manufacture, then both internal and external failure costs would decrease since we would produce less defective product. Appraisal costs would probably decrease since we may be able to reduce inspections and quality audits. Prevention costs would increase since we expended effort to design a better quality product.
6. Think again about the four costs of quality. Describe how each would change if we hired more inspectors without changing other aspects of quality.
If we hired more inspectors without changing other aspects of quality, then we would still produce the same number of defects. However, we would find more, but not necessarily all, of these defects before they reach the customer. Therefore, internal failure costs will increase, while external failure costs will decrease. Appraisal costs would increase since we are now paying for more inspectors. Prevention costs would remain the same since we did not change other aspects of quality.
7. Explain the meaning of the Plan-do-study-act cycle. Why is it described as a cycle?
The Plan-do-study-act cycle is a procedure for continuous improvement. First, a plan is developed after we have documented procedures, collected data and identified problems. Next, the plan is implemented. We then study the results of our implementation. Finally, we act based on the results. It is described as a cycle since it is an ongoing process or series of steps that is repeated.
8. Describe the use of quality function deployment (QFD). Can you find examples in which the voice of the customer was not translated properly into technical requirements?
QFD is a tool for matching customer requirements to technical requirements. This tool incorporates the customer requirements, the relative importance of the customer requirements, the technical requirements (how we can meet customer requirements), the strength and type of relationships between the customer and technical requirements, the relationships or trade-offs between the different technical requirements and the ratings of the ability of competitors and our company to meet customer requirements into one diagram in order to evaluate all this information in an integrated manner.
In the airline industry, low prices and direct, non-stop flights are two important customer requirements. Most airlines have focused on developing a hub-and-spoke system in order to improve efficiencies. A hub-and-spoke system is one in which many flights stop at a hub city, such as Atlanta, before continuing on to the final destinations, or the spokes. This limits the ability of the customers to find a direct, non-stop flight to their destination, thus increasing travel time.
9. Describe the seven tools of quality control. Are some more important than others? Would you use these tools separately or together? Give some examples of tools that could be used together.
The seven tools of quality control are the cause-an-effect diagram, flowchart, checklist, control chart, scatter diagram, Pareto chart and histogram. The cause-and-effect diagram, or fishbone diagram, shows all possible causes of one quality problem or defect type (effect), where the causes are separated into categories (or bones) on the diagram. It is used as a brainstorming tool to determine which causes to investigate. The flowchart documents the flow of the materials or customer through the steps of the process. The checklist lists the type of defects, along with a tally of the frequency of each type. Control charts show plots of samples of a product or service characteristic taken from the process over time. The control chart helps us determine whether the process is in control, which means that only random variation exists. Scatter diagrams are plots on an x-y axis used to determine the relationship between two variables. Pareto charts show the frequency and cumulative percentages of defect types arranged from most frequent to least frequent defect types. This chart demonstrates which defect types cause the majority of the quality problems or complaints. A histogram shows the frequency of each quality problem.
The Pareto chart and cause-and-effect diagram can be effectively used in combination. First, the Pareto chart is used to identify the problem(s) that cause the highest number of actual defects or complaints. Next, a common problem becomes the effect on the cause-and-effect diagram. This diagram then helps us identify causes to investigate in order to solve the problem.
10. What is the Malcolm Baldrige National Quality Award? Why is this award important and what companies have received it in the past?
The Malcolm Baldrige National Quality Award (MBNQA) is an award that was created by U.S. Congress in 1987 to promote quality and improve the trade deficit. The award is important because it provides an effective framework for improving quality. Many companies have used the MBNQA framework to improve quality, without an intention of applying for the award. Some of the companies that have received it are Motorola, AT&T, Xerox, Federal Express and Ritz-Carlton.
11. What are ISO 9000 standards? Who were they set by and why? Can you describe other certifications based on the ISO 9000 certification?
ISO 9000 is a set of standards and a certification program for companies based on a documentation of the quality processes. The standards were set by the International Organization for Standardization to set a standard for companies doing business. ISO 14000 is a set of standards that focuses on environmental concerns. QS 9000 is a set of standards based on ISO 9000 that is geared to the automobile industry.
12. Who are the three “gurus” of quality control? Name at least one contribution made by each of them.
The three gurus are Deming, Juran and Crosby. Deming helped management understand that most quality problems are caused by the processes and systems, not the workers. Deming motivated the usage of statistical quality control tools for differentiating between common and special causes of variation. Juran contributed to the quality movement by creating a focus on the definition and costs of quality. Crosby’s contribution is a result of his argument that quality is free, which is based on that idea that many costs of quality are hard to quantify.