Quality

Operations

RA Dec 200804/10/23

Quality

Quality is one of the key decisions in operations in today’s highly competitive global market.

Vital to increase profits, reduce costs and improve customer satisfaction.

Difficult term to define as it can mean different things to different people.

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How is quality viewed?

Consumer

Quantity provided for price paid

Reliability or lifetime of product

Extent to which product/service satisifies requirements e.g. appearance, technical

Producer

Meeting exact specifications

A highly skilled workforce

No customer complaints

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Factors to consider

An organisation will consider the following when assessing if they can provide quality in their operating systems:

Time, effort and technological input in design process Quality of supplies of materials and components Commitment and skill of the workforce System of monitoring and controlling operating process Ability to meet delivery deadlines After-sales service provided

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Question

Quality is important to German car manufacturers like Volkswagen.

Describe the factors that Volkswagen would have to consider when assessing if they can provide quality in their operating systems.

(3 marks)

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Solution

They would have to consider the quality of the materials and components they received from suppliers.

They would have to consider whether their current workforce had the necessary commitment and skill to fully implement the quality process.

They would have to look at their current system of monitoring and controlling operating process and see if it was compatible with a new quality process or required changing.

They would need to consider whether they would still be able to meet their delivery deadlines to customers.

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Quality

Organisations in the UK use a variety of measures to ensure all products and services meet a high level of quality. Include:

Benchmarking Quality control Quality assurance Quality circles Quality management British Standards

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Benchmarking Process of ‘quality assurance’

A method of improving quality of production or service by copying best techniques of organisation viewed as “the best”.

‘Best industry standard’ can be identified by asking customers, business analysts or journalists.

Very motivating for staff Can create a culture where continual improvement is

standard practice. Market leaders may be resistant to provide performance

figures for competitors Need to continue benchmarking even if they become

industry leaders to stay ahead of competitors.

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Quality control

Historic & reactive method of managing quality – works by failure.

A sample of raw materials and final product passed through a quality control check.

Unacceptable products discarded as waste or sent back.

Ensures substandard products are not sold to customers.

However, assumes wastage and scrap are inevitable – up to 25% of output can be wasted.

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Quality assurance

Based on prevention.

Products checked to ensure they meet agreed quality standards at certain points in the production process.

Requirements determined in advance, minimising risk of error – possibility of “right first time, every time”.

All aspects of process looked at to ensure errors don’t occur.

Known to reduce wastage and scrap to 5% or less.

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Question

Distinguish between quality control and quality assurance.

(1 mark)

Solution

Quality control is an historic & reactive method of managing quality whereas quality assurance is based on prevention.

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Quality circles

Originated in Japanese manufacturing industries – Toyota fist to use them in 1950s

Small groups of workers meet at regular intervals to discuss how improvements can be made to production process.

Principles:

1. No one in production process knows more about problems that might arise than the shop floor workers

2. Workers will appreciate and be motivated by opportunity to use knowledge and talents alongside management in problem-solving environment.

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Total Quality Management (TQM) Also known as Quality Management (QM)

System of doing things right the first time – no errors are tolerated!

All staff involved in ensuring absolute quality of their work.

Works on principle that the next person in line is your customer or client e.g. next person on factory line.

Constant striving to improve efficiency of processes and reduction of waste.

Although initially costly, can reduce wastage to around 3%.

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TQM requires:

Core corporate philosophy focusing on customer satisfaction Commitment by top management and provision of resources Every member of organisation consulted and involved Focus on teamwork and creative thinking to identify future

improvements Viewed as a long-term concept Quality plan offering structured, disciplined approach to

quality established Collection and analysis of information Investment in employee training Constant checking of quality standards by individuals Constant search for improvement Focus on total quality of output

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Introducing and implementing TQM systems

Requires 4 elements:

1. Definition of quality at each and every stage in process

2. Commitment of all3. A system in which this quality can be assured4. A measure of ability to meet quality

requirements

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1. Definition of quality at each and every stage in process

Intended usage, required outcomes, standards of safety, efficiency, quality of finished product, cost

Suppliers help customers identify precise requirements

Vague definitions impossible to implement

2. Commitment of all

Clear commitment in mission statement Quality manual/handbook outlining specific jobs Clear definition of every individual’s responsibility Drawing up and implementation of ‘contract’ to

confirm mutual obligation of supplier and customer

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3. A system in which this quality can be assured

System for checking and monitoring process and quality at all stages in production/provision.

Setting of specific targets of achievement Staff appraisal Reviewing, monitoring and feedback from

operatives.

4. A measure of ability to meet quality requirements

Can be carried out qualitatively or quantitatively Customers perceptions or objective measurements

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British Standards Institution (BSI) Organisation that produces national standards for

certain products.

Product meeting agreed quality and safety standards receives BSI “Kitemark” symbol.

Advantages

• May give an organisation a competitive advantage• Gives consumers confidence in the product

Disadvantages

• Process and paperwork may be lengthy

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Other trade organisations

Certain trade organisations introduce standards and logos for products which meet quality standards.

Red Lion Quality for eggs British wool symbol Association of British Travel Agents (ABTA) Investors in People (IIP)

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Question

Quality is central to the production of desirable goods and services.

Explain how a manufacturing organisation can ensure quality in the production process.

(4 marks)

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Solution

They could employ benchmarking. By comparing and copying their own production process with the best in the market, they can ensure quality.

They could also employ quality control. This would ensure quality in the production process by identifying unacceptable products, discarding them or sending them back and ensuring substandard products are not sold to customers.

They could employ quality circles. By utilising the knowledge of the people on the shop floor, they could identify any problems in the production process and ensure the complete commitment to quality of the people producing the goods and services.

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Question

Describe the advantages and disadvantages of using an effective quality assurance system.

(6 marks)

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Solution

Quality standards will be recognised by suppliers and customers

Waste will be reduced Customer complaints and returns will be reduced The reputation of the organisation will be improved Reduction in need for management intervention Organisation must invest in the quality assurance

system Staff training must be a continuing process All employees must be committed to the process.

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Summary

Quality The quality of a product or service is the degree to which

it satisfies customers’ requirements. This is influenced by:

Design Quality The degree to which the specification of the product or

service satisfies customers’ design requirements; and

Manufactured quality The degree to which the product or service, when made

available to the customer, conforms to specification.