10!!! Flashcards
What are the four cost categories in a cost of quality programme?
Prevention Costs: Costs to avoid producing defective products (e.g., design engineering, training).
Appraisal Costs: Costs to detect defects before products reach customers (e.g., inspections).
Internal Failure Costs: Costs from defects identified before shipping (e.g., rework).
External Failure Costs: Costs from defects identified after shipping (e.g., warranty repairs, customer complaints).
What are three methods companies use to identify quality problems?
Control Charts: Use statistical tools to monitor process variation and identify out-of-control occurrences.
Pareto Diagrams: Visualize the frequency of defects to focus on the most significant problems.
Cause-and-Effect Diagrams: Explore potential root causes of defects in categories like methods, materials, and human factors.
What are the relevant costs and benefits of quality improvements?
Relevant Costs: Variable costs of inspection, rework, and redesign that change with the quality initiative.
Relevant Benefits: Savings from reduced rework, fewer customer complaints, lower warranty claims, and better customer satisfaction.
What Are Examples of Non-Financial Quality Measures?
Non-financial quality measures evaluate performance without focusing on monetary outcomes. Examples include:
Customer Satisfaction: Number of complaints, percentage of defective units shipped, and on-time delivery rates.
Internal Performance: Process yield (ratio of good output to total output), number of defects identified, and employee turnover rates.
Why Use Both Financial and Non-Financial Quality Measures?
Financial measures focus on the costs of poor quality and help evaluate cost-benefit trade-offs. Non-financial measures provide immediate feedback, highlight specific problem areas, and predict long-term performance improvements.
Three Main Measurements in the Theory of Constraints (TOC)
The Theory of Constraints (TOC) uses three key measurements to evaluate performance: Throughput Contribution, which is sales revenue minus direct materials cost, measuring how much money the system generates; Investments, the cost of assets like materials, work-in-progress, and equipment used to support production; and Operating Costs, all other expenses (excluding direct materials) needed to earn throughput, such as wages and utilities. These metrics help identify and manage system constraints to improve overall efficiency and profitability.
What are the four steps in managing bottlenecks?
What Is a Bottleneck?
A bottleneck is the slowest or most overloaded step in a process that limits the overall production or throughput. It acts as a constraint, restricting the system’s ability to produce more output. For example, if a factory produces items but one machine is slower than the others, that machine becomes the bottleneck. Managing bottlenecks is essential to improving productivity and efficiency.
What are prevention costs in quality management
Costs incurred to prevent defects before they occur, such as staff training, quality control systems, and better product design. Investing in prevention reduces future failure and appraisal costs.
