quality philosophies and standards: baldrige to six sigma
DESCRIPTION
An overview of quality management with emphasis on the Malcolm Baldrige Quality CriteriaTRANSCRIPT
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Quality Philosophies and StandardsQuality Philosophies and Standards
Britt WatwoodBritt WatwoodCenter for Teaching ExcellenceCenter for Teaching Excellence
VCUVCU
(Baldrige, Six Sigma and Lean Mgmt)(Baldrige, Six Sigma and Lean Mgmt)
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What is meant by the term?What is meant by the term?
“Quality”
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Quality’s Quality’s FoundatioFoundatio
nn
QualityQuality
Philosophy &Practice
Tools
Empowerment
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Quality Quality EvolutioEvolutio
nn• 1930’s1930’s
– Shewart CycleShewart Cycle• 1950’s1950’s
– Deming in JapanDeming in Japan• 19801980
– Productivity / Quality CirclesProductivity / Quality Circles• 19851985
– Deming/Crosby/JuranDeming/Crosby/Juran• Late 1980’sLate 1980’s
– Total Quality MgmtTotal Quality Mgmt• 1990’s1990’s
– Baldrige CriteriaBaldrige Criteria• CurrentCurrent
– Six SigmaSix Sigma– Lean ManagementLean Management
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Quality Quality OverviewOverview
QMSMarkets &Customers
VOCLean
6 σ
ProductOperation
StrategyFormulation
ProductSupport
QualityQuality
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Malcolm Malcolm Baldrige Baldrige National National
Quality AwardQuality Award
www.quality.nist.gov
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Malcolm Malcolm Baldrige NQABaldrige NQA
• Twenty years evolvingTwenty years evolving• A Framework and A ToolA Framework and A Tool• Self-AssessmentSelf-Assessment• Promotes Awareness of Promotes Awareness of
Continuous Improvement Continuous Improvement and Excellenceand Excellence
• Sharing of Best PracticesSharing of Best Practices• Presented by the Presented by the
President of the United President of the United StatesStates
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Baldrige Baldrige is a is a
“Process”“Process”
• A systems perspective
• Built around core values
• Linkages within the framework
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Core Core ValuesValues
•Visionary LeadershipVisionary Leadership•Customer Driven ExcellenceCustomer Driven Excellence•A Learning OrganizationA Learning Organization•Valued Employees and Valued Employees and
PartnersPartners•AgilityAgility•Focus on the FutureFocus on the Future
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Core Core ValuesValues
•Managing for InnovationManaging for Innovation•Management By FactManagement By Fact•Social Responsibility Social Responsibility •Results and Value DrivenResults and Value Driven•Overall Systems PerspectiveOverall Systems Perspective
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Visionary Visionary LeadershipLeadership
• Senior leadership has Senior leadership has visionvision
• Senior leadership Senior leadership communicates that visioncommunicates that vision
• Values and expectations Values and expectations align with visionalign with vision
• Leaders are role modelsLeaders are role models
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Customer Customer Driven Driven
ExcellenceExcellence
• Quality and Performance are Quality and Performance are Judged by the CustomersJudged by the Customers
• Customer Satisfaction Customer Satisfaction tracked and used to improve tracked and used to improve processesprocesses
• Customer Satisfaction of Customer Satisfaction of Competitors Known and Competitors Known and Used to Improve Own Used to Improve Own OfferingsOfferings
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Organizational Organizational LearningLearning
• Learning directed Learning directed at improved at improved products…and products…and improved peopleimproved people
• Embedded in all Embedded in all processesprocesses
• ContinuousContinuous• Results in Positive Results in Positive
ChangeChange
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Valuing Valuing EmployeeEmployee
s &s &PartnersPartners
• Committed to Committed to satisfaction, satisfaction, development, and well-development, and well-being of employeesbeing of employees
• Recognition SystemsRecognition Systems• Risk-Taking EncouragedRisk-Taking Encouraged• Strategic Alliances with Strategic Alliances with
SuppliersSuppliers
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AgilityAgility
• The ability to The ability to thrive in the thrive in the White-water White-water Rapids of ChangeRapids of Change
• Cycle TimeCycle Time• ResponsivenessResponsiveness
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Focus Focus on the on the FutureFuture
• Long-Term ViewpointLong-Term Viewpoint• Long-Term Commitment Long-Term Commitment
to Key Stakeholdersto Key Stakeholders• Strategic Focus on Strategic Focus on
Resources, Employee and Resources, Employee and Product DevelopmentProduct Development
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Managing Managing For For
InnovationInnovation
• Innovation Part of Innovation Part of the Culturethe Culture
• More than More than SustainabilitySustainability
• Meaningful Change Meaningful Change to Products and to Products and ServicesServices
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Management Management
ByByFactFact• Measurement AND Measurement AND
Analysis of PerformanceAnalysis of Performance• Key Processes Key Processes
IdentifiedIdentified• Outputs KnownOutputs Known
– Yours and Competitors! Yours and Competitors!
• Comparison with Comparison with BenchmarksBenchmarks
• Use of Trend DataUse of Trend Data
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SocialSocialResponsibilityResponsibility
• Safe Work Safe Work EnvironmentEnvironment
• Legal Work Legal Work EnvironmentEnvironment
• Good Corporate Good Corporate CitizenCitizen
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Results Results & Value& Value
• Focus on Key ResultsFocus on Key Results• Creating Value for Creating Value for
StakeholdersStakeholders• CustomersCustomers• EmployeesEmployees• StockholdersStockholders• Suppliers / PartnersSuppliers / Partners• The CommunityThe Community
• Both Leading and Both Leading and Lagging IndicatorsLagging Indicators
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Systems Systems PerspectivePerspective
• Linkage and Alignment Linkage and Alignment between the Baldrige between the Baldrige CategoriesCategories– LeadershipLeadership– Strategic PlanningStrategic Planning– Customer & Market FocusCustomer & Market Focus– Measurement, Analysis, & KMMeasurement, Analysis, & KM– Workforce FocusWorkforce Focus– Process ManagementProcess Management– Business ResultsBusiness Results
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Baldrige Baldrige CriteriaCriteria
4 Measurement, Analysis & Knowledge Management
1Leadership
Organizational ProfileEnvironment, Relationships, &
Challenges
2StrategicPlanning
3Customer &
Market Focus
6ProcessMgmt
5Workforce
Focus7
BusinessResults
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ISO 9000ISO 9000
• Commitment to Customer Commitment to Customer RequirementsRequirements
• Documentation Documentation RequirementsRequirements
• Resource AllocationResource Allocation• Measurement and Measurement and
AnalysisAnalysis
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Standard Standard DeviationDeviation
Sigma is a measure ofvariation
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Sigma Sigma VariationVariation
• The sigma value is a The sigma value is a metric that indicates metric that indicates how well a process is how well a process is performing.performing.
• The higher the sigma The higher the sigma value, the better.value, the better.
• The higher the sigma The higher the sigma value, the more the value, the more the process is process is defect-freedefect-free..
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Example of Example of Sigma Sigma ValueValue
Yield DPMO Sigma
30.9%690,000 169.2%308,000 293.3% 66,800 399.94% 6,210 499.98% 320 599.9997% 3.4 6
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Yield DPMO Sigma
30.9%690,000 169.2%308,000 293.3% 66,800 399.94% 6,210 499.98% 320 599.9997% 3.4 6
Most companies Most companies operate at around operate at around 4 sigma – the 4 sigma – the quality standard quality standard set by the US set by the US Government in Government in WW IIWW II
Example of Example of Sigma ValueSigma Value
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What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•200,000 wrong drug prescriptions each year
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•Two short or long landings at major airports each day
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•5,000 incorrect surgical procedures every week
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•20,000 lost articles of mail every hour
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•Unsafe Drinking Water for 15 minutes each day
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•No electricity for 7 hours each month
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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•50 dropped newborns at the hospital each day
What Does 99% Defect-Free Mean?What Does 99% Defect-Free Mean?
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Defects Defects Effect Effect CostsCosts• The Cost of Quality The Cost of Quality
– 4 Sigma: 99.4%4 Sigma: 99.4%• 6,210 defects6,210 defects• Industry AverageIndustry Average• Lose 15-20% of salesLose 15-20% of sales
– 5 Sigma: 99.98%5 Sigma: 99.98%• 233 defects233 defects• Lose 5-10% of salesLose 5-10% of sales
– 6 Sigma: 99.9997%6 Sigma: 99.9997%• 3.4 defects3.4 defects• Lose Less than 1% of salesLose Less than 1% of sales
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DMADMAICIC
Design
Measure
Analyze
Improve
Control
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As a nation,we seem to be obsessed
with LEAN…
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Effectiveness vs EfficiencyEffectiveness vs Efficiency
V O C6 σ
Selection6 σ
Control6 σ
Improvement
ProcessMetrics
LeanMetrics
LeanWorkload
LeanProcess
Six Sigma = Effectiveness
Lean Mgmt = Efficiency
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• The term “The term “leanlean” is used ” is used because lean manufacturing because lean manufacturing uses “uses “lessless”…”…
Labor in the factoryManufacturing spaceCapital investmentMaterialsTime between the customer order and the product shipment
DefinitionDefinition
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Continuous flow
Batch size
Production
Layout
Processing
Quality
Based on forecast
Based on function / department
Large
Batch & queue
Lot sampling
Based on orders
Based on product flow
Small
Assured during processing
Traditional Lean
Lean Mgmt ComparisonLean Mgmt Comparison
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Key ElementsKey Elements::
• StabilityStability
• QualityQuality
• Continuous FlowContinuous Flow
• KaizenKaizen
• Pull SystemPull System
• Workload BalancingWorkload Balancing
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WasteWaste
“Anything that adds Cost
to the product without adding Value”
“Anything that adds Cost
to the product without adding Value”
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Non - Value Added: 95%
Value Added: 5%
WasteWaste
• Overproduction• Excess Inventory• Product Defects• Non-value added
processing• Wait time• Underutilized
labor• Excess motion• Unnecessary
Transportation
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7 Types 7 Types of Mudaof Muda
Typesof
Waste
CORRECTION
WAITING
PROCESSING
MOTION
INVENTORYCONVEYANCE
OVERPRODUCTION
Repair orRework Any wasted motion
to pick up parts or stack parts. Also wasted walking
Wasted effort to transportmaterials, parts, or finished goods into or out of storage, or between processes.
Producing morethan is needed before it is needed
Maintaining excessinventory of raw mat’ls,parts in process, orfinished goods.
Doing more work thanis necessary
Any non-work timewaiting for tools, supplies, parts, etc..
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Workplace Workplace
OrganizationOrganization
Maintain through empowerment,
commitment, and discipline
Sort
Sustain Set In Order
ShineStandardize
Keep machines and workareas clean
Use standard methods to keep Sort, Set In Order,
and Shine to a condition
Organize the work area
5 S
Get rid of clutter
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KAITo modify /
Change
ZENTo make good /
better+
= KAIZEN
Gradual and orderly, continuous improvement.
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Differences in Differences in
EmphasisEmphasis•Six Sigma– Process Improvement– Reduced Defect Rate
•Lean– Efficiency Improvement– Reduce Waste
•Baldrige Criteria– Performance Excellence
across Entire System– Results Oriented
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What MakesWhat Makes
Sense ForSense For
YOURYOUR
Company ???Company ???
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Questions???Questions???