Chapter 12 - The role of quality in performance measurement Flashcards
What are three ways of defining quality?
- Is it free from errors and adheres to design?
- Is it fit for use?
- Does it meet customer needs?
What should an effective quality management system aim to do?
- Minimise cost of quality
- Improve customer satisfaction with higher quality
- Improve staff morale and pride
What is the International Organisation of Standardisation?
An organisation that produces quality standards that can be applied to organisations.
What are four advantages of becoming ISO certified?
- Recognised standard
- Marketing
- Improved profitability
- International competitiveness
What are four disadvantages of becoming ISO certified?
- Cost
- Time
- Form filling over action
- Rigid policies stifles innovation
What are the two types of quality related cost?
- Cost of conformance
- Cost of non-conformance
What are the four quality related costs?
- Prevention costs
- Appraisal costs
- Internal failure costs
- External failure costs
What are Internal failure costs?
Costs arising from a failure to meet the quality standards before the product reaches the customer
What are External failure costs?
Costs arising from a failure to meet the quality standards after the product reaches the customer
How do conformance and non-conformance costs relate?
The more rigorous conformance is, the lower the costs of non-conformance will be.
What are the five quality practices?
- Kaizen costing
- Total quality management
- Just in time
- Six sigma
- Target costing
What is Kaizen costing?
Producing small, incremental cost reductions
throughout the production process through the product’s life.
What is target costing?
Setting a target cost by subtracting a desired profit from a competitive market price.
What are the four principles of total quality management
- Prevention of errors before they occur
- Continual improvement
- Real participation by all
- Management commitment
How can TQM be measured?
Using the 3 E’s
What is a Just in time system (JIT)?
A demand-pull system of ordering from suppliers which aims to reduce inventory levels to zero.
Requirements for successful operation of a JIT system
- Reliable staff and machinery suppliers
- Elimination of non-value adding activities
- Speed of throughput
- Flexibility
- Lower costs
What are four advantages of JIT?
- Low stock holding cost
- Low stock perishability
- Avoids build up of unsold products
- Less time checking as should work first time
What are four disadvantages of JIT?
- Small room for error
- Overly reliant on suppliers
- Hard to get employees to embrace
- No spare product to meet unexpected orders
What is Lean production
A philosophy of management based on cutting out waste and unnecessary activities
What are 7 activities cut out by lean production?
- Over production
- Inventory
- Waiting
- Defective units
- Motion
- Transportation
- Over-processing
What are the 5 S’s?
- Structurize
- Systemize
- Sanitise
- Standardize
- Self discipline
Give an example of Structurize
Introduce order where possible, for example by ensuring that items are arranged so that they are easy to find.
Give an example of Systemize
Arrange and identify items for ease of use and approach tasks systematically. For example, by arranging items so that they can be accurately picked in the shortest time.
