BU OPM 311 - Quality Management and Six Sigma

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Quality Management and Six Sigma Start Exam 3High Performance Business1. Operational Excellence/World Class – Market Leadership2. Customer-Focused Quality (Six Sigma) – Total quality by reducing variation and eliminating defects3. Best In Class Lean – Flexibility and speed by eliminating waste in process 4. Class A ERP – Predictable performance through accuracy of plans & dataAll lead to Continuous ImprovementTakes less time as you go down the listDefectsFound in Development  Found in Prototyping  Found in Production  Found by the Customer- Cost and impact to company & effort to find and eliminate the problem both increase as you move forwardTotal Quality Management: managing the entire organization so that it excels on all dimensions of products and services that are important to the customerFundamental Operational Goals:1. Careful design of the product or service2. Ensuring that the organizations systems can consistently produce the design (design for manufacturability)The Quality GurusW Edwards Deming - Man behind Plan Do Check Act- Helped Japan gain manufacturing excellence after WWII- 14 key principles to managers for transforming business effectivenessPhil Crosby- Wrote Quality is Free- Known for Zero Defects- Definition of quality: conformance to requirements - General approach: prevention, not inspectionJoseph Juran- Wrote the Quality Control Handbook- The Juran Trilogy; Quality Planning, Quality Control, Quality Improvement- One of the first to write about costs of poor quality- Definition of quality: fitness for use (satisfies customers needs)Quality Specifications and Quality Costs- Design quality – inherent value of the product in the marketplace- Conformance quality – degree to which the product or service design specification are met- Drivers: Performance, Features, Reliability/durability, Aesthetics, Features, Serviceability, Perceived Quality- Fundamental to any quality program is the determination of quality specifications and thecosts of achieving (or not achieving) those specifications - Quality at the source: making the person who does the work responsible for ensuring that specifications are metCosts of Quality (COQ)- Expenditures related to achieving product or service quality1. Appraisal Costs: after product/service is produced, costs of the inspection and testing to ensure that the product or process is acceptable2. Prevention Costs: before the product/service is produced, sum of all the costs to prevent defects3. Internal failure costs: costs for defects incurred within the system or business4. External failure costs: costs for defects that pass through the system or businessInternational Organization for Standardization (ISO)- Series of standards agreed upon by the International Organization for Standardization- Adopted in 1987- More than 160 countries- ISO 9000 directs you to "document what you do and then do as you documented”; international reference for quality management requirements in business-to-business dealing- ISO 14000 is a family of standards on environmental management; primarily concerned with environmental management- ISO 26000 encourages organizations to discuss social responsibility issues and possible actions with relevant stakeholdersSix Sigma- A philosophy and set of methods companies use to eliminate defects in their products andprocesses- Seeks to reduce variation in the processes that lead to product defects- Refers to the goal of no more than 4 defects per million unitsDefects per million opportunities (DPMO) = Number of defects * 1,000,000 Number of opportunities for error per unit * Number of units1. Define, measure, analyze, improve and control (DMAIC)2. Overall focus of the methodology is to understand and achieve what the customer wants referred to as “the voice of the customer”3. Started by Motorola and Developed by General Electric as a means of focusing effort on quality using a methodological approach4. A Six-Sigma program seeks to reduce the variation in the processes that lead to these defectsDMAIC CycleDefine: identify customers and their priorities; Identify CTQ (critical-to-quality characteristics) Measure: determine how to measure the process and how it is performingAnalyze: determine the most likely causes of defects; fishboneImprove: identify means to remove the causes of defectsControl: determine how to maintain the improvementsSix Sigma Analytical Tools- Flowchart – diagram of the sequence of operations (define)- Run chart – depict trends in data over time (measure)- Pareto chart – help to break down a problem into components (measure)- Checksheet – basic form to standardize data collection (measure)- Cause-and-effect diagram: show relationships between causes and problems; fishbone diagrams (analyze)- Opportunity flow diagram: used to separate value-added from non-value-added (improve)- Process Control Chart: used to assure that processes are in statistical control (control)- SIPOC: suppliers, inputs, processes, outputs, customersFailure mode and effect analysis (FMEA): identify, evaluate, and estimate risk of possible failures at each stage of a process- RPN (risk priority number) is calculated for each failure mode; an index used to measure the rank importance of items listed in the FMEA chartDesign of experiments (DOE): a statistical methodology used for determining the cause-and-effect relationship between process variables (X) and the output variable (Y); also known as multivariate testingStatistical Quality ControlAssignable Variation: variation that is caused by factors that can be clearly identified and possibly even managed Common variation: variation that is inherent in the process itself; random variationCapability Index: shows how well the parts being produced fit into the range specified by the design specification limitsCpk = min[(Average – LSL / 3SD) – (USL – Average) / 3SD]Process Control Procedures- Monitoring quality while the product or service is being produced Statistical Process Control (SPC): involves testing a random sample of output from a process to determine whether the process is producing items within a preselected rangeAttributes: quality characteristics that are classified as either conforming or not conforming to specificationFour main issues to address in creating a control chart:1. Size of Samples2. Number of Samples3. Frequency of Samples4. Control LimitsAcceptance sampling is performed on goods

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