1 Introduction to Quality and Performance Excellence
The totality of features and characteristics of a product or service that bears on its ability to satisfy given needs – American Society for Quality Definitions given by three most popular Quality management gurus; Fitness for use ( Dr. Joseph Juran) A predictable degree of uniformity and dependability at low cost and suited to the market i.e. Meeting or exceeding customer expectations ( Dr. W. Edwards Deming) Conformance to specifications (Philip Crosby) 2
Perfection Consistency Eliminating waste Fast delivery Compliance with policies and procedures Providing a good, usable product Doing it right the first time Delighting or pleasing customers Total customer service and satisfaction
THE buzzword among business in the 1980s and 1990s Quality problems still abound in many industries, such as automotive Consumer expectations are high “We’ve made dependence on the quality of our technology a part of life” – Joseph Juran
Skilled craftsmanship during Middle Ages Industrial Revolution: rise of inspection and separate quality departments Early 20th Century: statistical methods at Bell System Quality control during World War II Post-war Japan: evolution of quality management 5
Quality awareness in U.S. manufacturing industry during 1980s: from “Little Q” to “Big Q” - Total Quality Management (TQM) Malcolm Baldrige National Quality Award (1987) Disappointments and criticism 6
Emergence of quality management in service industries, government, health care, and education Evolution of Six Sigma Current and future challenge: maintain commitment to performance excellence 7
Company reputation Cost and market share Product liability The international implication
Performance – primary operating characteristics Features – “bells and whistles” Reliability – probability of operating for specific time and conditions of use Conformance – degree to which characteristics match standards Durability - amount of use before deterioration or replacement Serviceability – speed, courtesy, and competence of repair Aesthetics – look, feel, sound, taste, smell
Time – how much time must a customer wait? Timeliness – will a service be performed when promised? Completeness – Are all items in the order included? Courtesy – do frontline employees greet each customer cheerfully? Consistency – are services delivered in the same fashion for every customer, and every time for the same customer? Accessibility and convenience – is the service easy to obtain? 10
Customer needs and performance standards are often difficult to identify and measure The production of services typically requires a higher degree of customization The output of many service systems is intangible Services are produced and consumed simultaneously Customers often are involved in the service process and present while it is being performed Services are generally labor intensive Many service organizations must handle very large numbers of customer transactions.
The Deming philosophy focuses on continual improvements in product and service quality by reducing uncertainty and variability in design, manufacturing, and service processes, driven by the leadership of top management.
13 Improve quality Costs decrease Productivity improves Increase market share with better quality and lower prices Stay in business Provide jobs and more jobs
Appreciation for a system Understanding variation Theory of knowledge Psychology 14
Most organizational processes are crossfunctional Parts of a system must work together Every system must have a purpose Management must optimize the system as a whole 15
Many sources of uncontrollable variation exist in any process Excessive variation results in product failures, unhappy customers, and unnecessary costs Statistical methods can be used to identify and quantify variation to help understand it and lead to improvements 16
Knowledge is not possible without theory Experience alone does not establish a theory, it only describes Theory shows cause-and-effect relationships that can be used for prediction 17
People are motivated intrinsically and extrinsically; intrinsic motivation is the most powerful Fear is demotivating Managers should develop pride and joy in work 18
19 1. Create and publish a company mission statement and commit to it. 2. Learn the new philosophy. 3. Understand the purpose of inspection. 4. End business practices driven by price alone. 5. Constantly improve system of production and service. 6. Institute training. 7. Teach and institute leadership. 8. Drive out fear and create trust.
20 9. Optimize team and individual efforts. 10. Eliminate exhortations for work force. 11. Eliminate numerical quotas and M.B.O. Focus on improvement. 12. Remove barriers that rob people of pride of workmanship. 13. Encourage education and self-improvement. 14. Take action to accomplish the transformation.
Juran proposed a simple definition of quality: “fitness for use.” This definition of quality suggests that it should be viewed from both external and internal perspectives; that is, quality is related to; (1) product performance that results in customer satisfaction; (2) freedom from product deficiencies, which avoids customer dissatisfaction.
Quality planning Quality control Quality improvement 22
Philip Crosby Quality is free . . . “Quality is free. It’s not a gift, but it is free. What costs money are the unquality things -- all the actions that involve not doing jobs right the first time.”
Quality means conformance to requirements Problems are functional in nature There is no optimum level of defects Cost of quality is the only useful measurement Zero defects is the only performance standard 24
Customer and stakeholder focus Process orientation Continuous improvement and learning Employee engagement and teamwork Management by fact Visionary leadership and a strategic orientation 25
Customer is principal judge of quality Organizations must first understand customers’ needs and expectations in order to meet and exceed them Organizations must build relationships with customers Customers are internal and external 26
A process is a sequence of activities that is intended to achieve some result 27
Incremental and breakthrough improvement Products and services Work processes Flexibility, responsiveness, and cycle time Learning – why changes are successful through feedback between practices and results
1. Planning 2. Execution of plans 3. Assessment of progress 4. Revision of plans based upon assessment findings
Engagement – workers have a strong emotional bond to their organization, are actively involved in and committed to their work, feel that their jobs are important, know that their opinions and ideas have value, and often go beyond their immediate responsibilities for the good of the organization Teamwork must exist vertically, horizontally, and inter-organizationally 31
Organizations need good performance measures to drive strategies and change, manage resources, and continuously improve Data and information support analysis at all levels Typical measures: customer, product and service, market, competitive comparisons, supplier, employee, cost and financial
Leadership is the responsibility of top management Senior leaders should be role models for the entire organization Leaders must make long-term commitments to key stakeholders Quality should drive strategic plans