Process Quality & Improvement Module u Quality & the Voice of the Customer »What is Quality? »Quality Programs in practice »Voice of the Customer u Process

Process Quality & Improvement Module Quality & the Voice of the Customer

» What is Quality?» Quality Programs in practice» Voice of the Customer

Process Capability and Improvement» Process Capability» Checking for Improvement (Quality Wireless)

Voice of the Process» Process Variability» Statistical Process Control (Quality Wireless (B))

Why 6-Sigma?» Flyrock Tires

Lin/Operations/Quality 2

8 Dimensions of Quality

Performance Features Serviceability Aesthetics Perceived Quality Reliability Conformance Durability


Elements of TQM

Management by fact Cross-functional (process) approach Culture and leadership

– Customer focus

– Employee focus

– High performance focus» Continuous improvement

» Benchmarking

External alliances - the value chain

Source: Eitan Zemel


1 Leadership 110 2 Strategic Planning 80

– Strategy Development Process

3 Customer and Market Focus 80 4 Information and Analysis 80 5 Human Resource Development and Management 100 6 Process Management 100

– Product and Service Processes – Support Processes – Supplier and Partnering Processes

7 Business Results 450 TOTAL POINTS 1000

Malcolm Baldridge National Quality Award



ISO 9000

Series of standards agreed upon by the International Organization for Standardization (ISO)

Adopted in 1987

More than 100 countries

A prerequisite for global competition?

ISO 9000: “document what you do and then do as you documented.”

Source: Adapted from Chase & Aquilano

Design Procurement Production Final test Installation Servicing

ISO 9003

ISO 9002

ISO 9001


Components of Quality

Voice of the customer

– Customer Needs

– Quality of Design

Voice of the process

– Quality of Conformance (Process Capability)

– Process Variability


Specification Example: US Open Tennis Balls

Wilson makes tennis balls for the US Open and sells a consumer version of the “same” ball.

Test balls by subjecting them to 18 pounds of force and measuring the extent of deformation.

Standard for Consumer Balls: 0.255′′ 0.035– That is, 0.220′′ to 0.290′′ conform to the standard.

Standard for Tournament Balls: 0.2425′′ 0.0025– That is, 0.240′′ to 0.245′′ conform to the standard.


Voice of the Customer: Linking Customer Needs to Business Processes

Business Process Customer Need Internal Metric

Overall Quality

Product (30%)

Sales (30%)

Installation (10%)

Repair (15%)

Billing (15%)

Reliability (40 %) % Repair Call

Easy to Use (20%) % Calls for Help

Features/Functions (40%) Function Performance Test

Knowledge (30%) Supervisor Observations

Response (25%) % Proposals Mad on Time

Follow-Up (10%) % Follow-Up Made

Delivery Interval (30%) Average Order Interval

Does Not Break (25%) % Repair Reports

Installed When Promised % Installed on Due Date

No Repeat Trouble (30%) % Repeat Reports

Fixed Fast (25%) Average Speed of Repair

Kept Informed (10%) % Customers Informed

Accuracy, No Surprise (45%) % Billing Inquiries

Response on First Call (35%) % Respolved First Call

Easy to Understand (10%) % Billing InquiriesSource: Kordupleski et al., CMR ‘93.


Voice of the Customer: Quality Function Deployment

What do customers want? Are all preferences equally important? Will delivering perceived needs deliver a competitive

advantage? How can we change the product? How do engineering characteristics influence customer

perceived quality? How does one engineering attribute affect another? What are the appropriate targets for the engineering

characteristics?

House of Quality

Source: Hauser and Clausing 1988

Customer Requirements

Importance to Cust.

Easy to close

Stays open on a hill

Easy to open

Doesn’t leak in rain

No road noise

Importance weighting

Engineering Characteristics

Ene

rgy

need

ed

to c

lose

doo

r

Che

ck f

orce

on

leve

l gro

und

Ene

rgy

need

ed

to o

pen

door

Wat

er r

esis

tanc

e

10 6 6 9 2 3

7

5

3

3

2

X

X

X

X

X

Correlation:

Strong positive

Positive

NegativeStrong negative

X*

Competitive evaluation

X = OursA = Comp. AB = Comp. B(5 is best)

1 2 3 4 5

X AB

X AB

XAB

A X B

X A B

Relationships:

Strong = 9

Medium = 3

Small = 1Target values

Red

uce

ener

gy

leve

l to

7.5

ft/l

b

Red

uce

forc

eto

9 lb

.

Red

uce

ener

gy to

7.5

ft/

lb.

Mai

ntai

ncu

rren

t lev

el

Technical evaluation(5 is best)

5

4321

B

A

X

BA

X B

A

X

B

X

A

BXABA

X

Doo

r se

al

resi

stan

ce

Acc

oust

. Tra

ns.

Win

dow

Mai

ntai

ncu

rren

t lev

el

Mai

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ncu

rren

t lev

el

X

- + - -+ +


Quality & the Voice of the Customer: Key Learning Objectives

Elements of TQM / Baldridge / ISO 9000

Components of Quality

Voice of the Customer– Linking business processes to customer needs

– Convert customer needs to product and process specifications: QFD


Process Quality & Improvement Module

Quality & the Voice of the Customer» What is Quality?» Quality Programs in practice» Voice of the Customer


Voice of the Process» Process Variability» Statistical Process Control (Quality Wireless (B))



Process Capability

Percent defective– Proportion of output that does not meet customer

specifications

Sigma-capability– Number of standard deviations from the mean of the

process output to the closest specification limit.


Quality Wireless (A): CapabilityDistribution of Average Daily Hold Time for 2003-04

0

2

4

6

8

10

12

14

16

18

20

39 43 47 51 55 59 63 67 71 75 79 83 87 91 95 99 103

107

111

115

119

123

127

131

135

139

143

147

151

155

159

163

Average Daily Hold Time

Nu

mb

er o

f D

ays

Out of SpecsWithin Specs


Quality Wireless (A): Capability Proportion of days within specification in 2003-04 =

491/731 = 0.672 The call center had a mean hold time of 99.67 with a

standard deviation of 24.24. With a specification of 110 seconds or less,

σ-capability of call center = (110 – 99.67)/24.24

= 0.426

The call center is a 0.426-sigma process. Expected fraction of days within specifications from a 0.426-sigma process = NORMSDIST(0.426) = 0.665


Process Improvement?


Continuous Improvement:PDCA Cycle (Deming Wheel)

Institutionalize the change or abandon or do it again.

Execute the change.Study the results; did it work?

1. Plan

2. Do3. Check

4. Act

Plan a change aimed at improvement.


Quality Wireless (A): Checking for Improvement Performance in April 2005: Mean = 79.50, Standard

deviation = 16.86 What is the probability of observing such a sample if

performance has not improved relative to 2003-04?– Mean hold in 2003-04 = 99.67

– Standard deviation = 24.24

– Given that April 2005 had 30 days, we need to consider distribution of samples of size 30. The standard deviation of sample means = 24.24/√30 = 4.43

– Probability of observing a sample of size 30 with mean 79.50 or less = NORMDIST(79.50, 99.67, 4.43, 1) = 2.64E-06





Voice of the Process» Process Variability» Statistical Process Control (SPC)» Quality Wireless (B)



Has Process Performance Changed? Quality Wireless (B)

Average hold time from September 1-10 =86.6 seconds– Ray yells at supervisors

Performance improves from September 11-20 to an average hold of 74.4 seconds

What do you think of Ray’s management style?


Performance of Inventory Manager

J F M A M J J A S O N

WIP

Award Given

Manager repents and kicks...

J F M A M J J A S O N D J F

WIP

J F M A M J J A S O N D J F M A M J

WIP

.. and concludes that kick ... mgt works !?

month

month

month


Source of Variability

Inherent (common cause)

External (assignable cause)

Objective: Identify inherent variability and eliminate external variability. A process is in control if it has only inherent variability.

To improve the system, attack common causes (methods, people, material, machines). This is the role of management.


Statistic Process Control – Quality Wireless (B)

After the improvements, daily hold time has an average of 79.50 and a standard deviation of 16.86.

Since we are considering samples of size 10 (10 days), we need to consider the distribution of sample means. Sample means have an average of 79.50 and a standard deviation of 16.86/√10 = 5.33.

Probability of observing 86.6 or higher even if process is in control = 1-NORMDIST(86.6, 79.50, 5.33, 1) = 0.0915


SPC – Quality Wireless (B)

Probability of observing 74.4 or lower even if process is in control = NORMDIST(74.4, 79.50, 5.33, 1) = 0.1693

What we need is a hypothesis test each time we observe a sample – Does the sample belong to the in-control population or not?


SPC – Setting Control Limits

Upper Control Limit = UCL = Mean + 3σXbar

Lower Control Limit = LCL = Mean - 3σXbar

In the case of Quality Wireless– UCL = 79.50 + 3×5.33 = 95.49

– LCL = 79.50 - 3×5.33 = 63.51

The process was in control when samples with means of 86.6 and 74.4 were observed.


Voice of the Process:Key Learning Objectives

The role of variability in evaluating performance

A process – in control has only inherent (from common cause) variation

– out of control has variation from an assignable cause

SPC framework for process control and improvement





Voice of the Process» Process Variability» Statistical Process Control (SPC)» Quality Wireless (B)



Why 6-Sigma? 2 sigma: 69.146% of products and/or services meet customer requirements

with 308,538 defects per million opportunities.

4 sigma: 99.379% of products and/or services meet customer requirements ...

but there are still 6,210 defects per million opportunities.

6 sigma: 99.99966% – As close to flaw-free as a business can get, with just

3.4 failures per million opportunities (e.g. products, services or transactions).


Why 6-Sigma?

Impact of # of parts/stages in a process

Probability that process/product meets specs3 -sigma 4 - sigma 5 - sigma 6 - sigma

# of steps/parts1 93.3% 99.4% 100.0% 100.0%

10 50.1% 94.0% 99.8% 100.0%50 3.2% 73.2% 98.8% 100.0%

100 0.1% 53.6% 97.7% 100.0%144 0.00% 40.8% 96.7% 100.0%369 10.0% 91.8% 99.9%740 1.0% 84.2% 99.7%

1044 0.1% 78.4% 99.6%1590 0.00% 69.1% 99.5%

19581 1.0% 93.6%42559 0.00% 86.5%

100000 71.2%1000000 3.3%

0.0%

0.0%

0.1%

1.0%

10.0%

100.0%

1 10 100 1000 10000 100000 1000000

# steps/components

Probability that process/productmeets specs

3 -sigma

4 - sigma

5 - sigma

6 - sigma


Why 6-Sigma? Robustness to Mean Shifts

100 130 160

LSL USL

= 10

100 143 160

LSL USL

= 10

LSL USL

= 5

100 130 160

LSL USL

= 5

100 143 160

99.9 % 99.9 %


Why 6-Sigma? 6-Sigma Quality at Flyrock

At the extruder, the rubber for the AX-527 tires had thickness specifications of 400 10. Susan and her staff had analyzed many samples of output from the extruder and determined that if the extruder settings were accurate, the output produced by the extruder had a thickness that was normally distributed with a mean of 400 and a standard deviation of 4.

If the setting is accurate, what proportion of the rubber extruded will be within specifications?


Process Capability: Sigma Capability Sigma capability is the number of standard deviations

from the mean to the closest specification limit. Sigma capability of extrusion process =

Susan has asked operators to take a sample of 10 sheets of rubber each hour from the extruder and measure the thickness of each sheet. Based on the average thickness of this sample, operators will decide whether the extrusion process is in control or not. Given that Susan plans 3-sigma control limits, what upper and lower control limits should she specify to the operators?


Impact of Mean Shift

If a bearing is worn out, the extruder produces a mean thickness of 403 when the setting is 400. Under this condition, what proportion of defective sheet will the extruder produce?

Assuming the earlier control limits, what is the probability that a sample taken from the extruder with the worn bearings will be out of control?

On average, how many hours are likely to go by before the worn bearing is detected.


Why 6-Sigma? Rapid Detection

What if extrusion is to become a 6-Sigma process?– Target mean =

– Target standard deviation =

Process improvement has resulted in the extrusion process having a mean of 400 and a standard deviation of 1.667. What should the new control limits be? What is the proportion of defectives produced?


Improving Process Capability

Return to the case of the worn bearing where extrusion produces a mean thickness of 403 when the setting is 400. Under this condition, what proportion of defective sheets will the extruder produce (for the 6-sigma process)?

Assuming the new control limits, what is the probability that a sample taken from the extruder with the worn bearings will be out of control?

On average, how many hours are likely to go by before the worn bearing is detected.


Key Learning Objectives: Process Quality

Specification limits: Voice of the customer Process capability is a measure of the quality

delivered (external): links VoP with VoC Improving capability may require variability reduction

and/or mean shift Control limits used to verify if process is in control

(internal), i.e., is maintaining capability: Voice of the process

Higher process capability reduces defectives and speeds up detection of assignable cause

Documents

Process Quality & Improvement Module u Quality & the Voice of the Customer »What is Quality? »Quality Programs in practice »Voice of the Customer u Process