CH 12: Six Sigma Quality

managing the entire organization so that it excels on all dimensions of products and services that are important to the customer

Total Quality Management (TQM)

What are the 2 fundamental operational goals of TQM?

Design
Control

What laid the foundation for Six Sigma

Total Quality Management (TQM)

What are the main themes that come from the quality gurus (Crosby, Demin, and Juran)

Customer focus 
Worker involvement 
Continuous improvement
Management leadership 

Who are the gurus of quality?

Crosby
Deming
Juran

who is recognized as the grandfather of six sigma

Deming

Which of the gurus defines quality in terms of the market

Crosby

Which of the gurus defines quality in terms of the process

Juran 

Which of the gurus defines quality in terms of both the market and the process 

Deming 

__’s definition of quality: conformance to requirements

Crosby

__’s definition of quality: predictable degree of uniformity, dependability at low cost, market alignment (think house of quality)

Deming

__’s definition of quality: meeting customer’s needs (fitness for use)

Juran

__’s ideas on senior management responsibility: responsibility for quality is 100% on the senior level 

Crosby

__’s ideas on senior management responsibility: senior management responsible for the vast majority (94%) of quality problems

Deming

__’s ideas on senior management responsibility: workers are responsible for very little (less than 20%) of quality problems

Juran

__’s ideas on Performance Standards and Motivation: zero defects (not for general use- not really achievable unless very high profit margin product where ALL can be inspected)

Crosby

__’s ideas on Performance Standards and Motivation: Quality is multi-dimensional and has many scales; statistical measures of performance; not a believer in zero defects

Deming

__’s ideas on Performance Standards and Motivation: avoid campaigns touting perfection 

Juran 

__’s General Approach to Quality: Prevention, not inspection 

Crosby

__’s General Approach to Quality: Reduce variability by continuous improvement and cease mass inspection (too expensive and inefficient- must rely some on statistics)

Deming

__’s General Approach to Quality: infuse all levels of management with quality focus and pay particular attention to the human side of quality efforts

Juran

__’s Structure of Quality Efforts: 14 steps to quality

Crosby

__’s Structure of Quality Efforts: 14 steps for management 

Deming 

__’s Structure of Quality Efforts: 10 steps to quality improvement

Juran

__’s Statistical Quality Control (SQC): rejects statistically acceptable levels of quality due to the zero defects (100% quality) requirement

Crosby

__’s Statistical Quality Control (SQC): statistical methods are vital to quality control

Deming

__’s Statistical Quality Control (SQC): Use SQC but exercise caution as one size does not fit all; focuses on human interaction with the process 

Juran

__’s Improvement Basis: Processes, not programs, for quality improvement

Crosby

__’s Improvement Basis: continuous to reduce variation and eliminate goals that have no method

Deming

__’s Improvement Basis: project by project team approach and set goals and have a process map

Juran

__’s Teamwork in Quality: quality improvement teams and councils 

Crosby 

__’s Teamwork in Quality: employees must participate in decision making and remove artificial barriers among departments

Deming

__’s Teamwork in Quality: team and quality circles (communicate across silos)

Juran

__’s Cost of Quality: Cost of nonconformance is high and quality is free (FALSE)

Crosby

__’s Cost of Quality: no optimum level of quality and continuous improvement is the focus 

Deming 

__’s Cost of Quality: quality is not free and no optimum level of quality

Juran

__’s Purchasing and Procurement: Supplier is an extension of internal operations, same zero defects rules apply, fault lies with the procurement managers

Crosby

__’s Purchasing and Procurement: Inspection is too late as samples still allow defects into the system; use statistical evidence and quality control charts

Deming

__’s Purchasing and Procurement: use formal surveys of procured goods and views it as a complex issue

Juran 

__’s Vendor Ratings: rate the vendors and avoid quality audits

Crosby

__’s Vendor Ratings: vendor ratings have highly limited utility and selection process is critical

Deming

__’s Vendor Ratings: rate vendors on standard metric and help the laggards come up to better levels

Juran

inherent value of the product in the marketplace 

design quality 

degree to which the product or service design specifications are met

conformance quality

What are the 6 Quality costs?

Performance
Features
Reliability
Serviceability
Aesthetics
Perceived Quality

What are the two quality specifications?

Deign
Conformance

quality cost concerned with: primary product or service characteristics 

performance 

quality cost concerned with: secondary features adding value to product

features

quality cost concerned with:  consistency of performance over time (failure probability)

reliability (durability)

quality cost concerned with: ease of repair should failure occur

serviceability

quality cost concerned with: sensory characteristics (touch, feel, sound)

aesthetics

quality cost concerned with: perceived brand, performance and reputation

perceived quality

what are the 4 costs of quality?

Appraisal
Prevention
Internal Failure
External Failure

cost of the inspection and testing to ensure that the product or process is acceptable

Appraisal cost

sum of all the costs to prevent detection

prevention costs

costs for defects incurred within the system

Internal failure costs

costs for defects that pass through the system (these are the most costly mistakes- think recalls)

External failure costs

a philosophy set of methods companies use to determine defects in their products and processes

Six Sigma Quality Management

What is the aim of Six Sigma? 

reduce variation in the processes that lead to product defects 

Six sigma refers to the goal of no more than ___ defects per million units

3.4

What does DPMO stand for?

Defective
Parts
per
Million
Output

any item or event that does not meat the customers requirements

defect

any chance for a defect to occur 

opportunity 

DPMO=

#defects / (# opportunities for error x # units) x 1,000,000

Developed by general electric as a means of focusing effort on quality using a methodological approach

Six Sigma

What are the core principles of Six Sigma

Define
Measure
Analyze
Improve
Control (DMAIC)

The overall focus of the six sigma methodology is to understand and achieve: 

what the customer wants and reduce variation in process leading to defects 

What are the levels of responsibility in Six Sigma

Senior level buy in and implementation
Corp wide training
Set stretch objectives for improvement
Continuous reinforcement and rewards overtime (DMAIC)

Part of the DMAIC Cycle where: identify customers and their priorities

Define

Part of the DMAIC Cycle where: determine how to measure the process and how it is performing

Measure

Part of the DMAIC Cycle where: determine how to measure the process and how it is performing 

Analyze 

Part of the DMAIC Cycle where: identify means to remove the causes and defects

iImprove

Part of the DMAIC Cycle where: determine how to maintain the improvements (hardest issue of DMAIC bc need it to stick with the employees)

Control

a diagram of the sequence of operations

flowchart

depict trends in data over time 

run chart 

help to break down a problem into components

pareto chart

basic form to standardize data collection; simplest form of six sigma data analytical tools

check sheet

show relationships between causes and problems; uses a macro and micro level approach; used to find the root cause of a defect in a system from process perspective 

cause and effect diagram (fish bone)

used to separate value added from non value added 

opportunity flow diagram 

used to assure that processes are in statistical control

process control chart

What are the 6 sigma analytical tools? How do you graph six sigma?

Flowchart
Run chart
Pareto chart
Check sheet
Cause and effect diagram
Opportunity flow diagram
Process control chart

For a check sheet, you check something when:

something goes wrong

award established by the US dept of commerce given annually to companies that excel in quality (products and processes) in different industries (18 of them); given by the national institute of standards and technology

Malcolm Bridge National Quality Award

candidates for the ___ award must remain an application of up to 50 pages that details the approach, deployment, and results of their quality activities under seven major categories

Baldrige

What are the seven major categories that the Baldrige award is based on? 

Leadership 
Strategic Planning 
Customer and Market Focus 
Info and analysis 
HR 
Process management 
Business results 

Series of international standards agreed upon by the international organization for standardization; adopted in 1986 with more than 160 countries; often considered a necessity in manufacturing firms to win contracts

ISO 9000 (international reference of quality)
ISO 14000 (environ management concern)

Why go through Baldrige or ISO? Helps demonstrate:

Customer focus
Leadership
Engagement with employees
Process based approach
Continuous improvement
Fact based decision making
Assure key partners/supply chain members of competence