Quality Flashcards
definition, classification of costs
Quality is critical to the survival and success of many businesses.
As quality increases price can also increase
you must define quality for the product in the question
1. free from errors
2. fit for purpose
3. meets customer needs
classification of Quality costs - conformance and non conformance costs
1. conformance costs - prevention (Training, design) and appraisal (quality control, testing) . costs of preventing failure.
2. Non conformance costs - internal failure (discovered before delivery to customer e.g. rework, waste) and external failure ( discovered by customer e.g. replacement, refund, reputational) - These are cost consequence of failure.
Systemised - Total quality management
A Japanese philosophy of establishing a system to prevent errors from occurring and getting things right first time.
It is a continual process involving management and staff to deliver quality to customer and demand quality of internal processes and supply chain.
The general focus is to invest in conformance costs in the hope of reducing non conformance costs.
TQM stresses
1. Processes -checks and balances
2. Training of staff - cultural change
3. Leadership - Top down change
4. continuous improvement - long run policy
5. The supply chain -
Systemised - Five S model
A Japanese idea stressing tidiness in the workplace
Structurise - Remove unnecessary material by sorting
systemise - organise the work place. A place for everything and
everything has a place
sanitise - clean it and keep it clean
standardise - create a standard process for everything
self discipline - sustain through self discipline
Exam - Nelson, Jody and Nigel
Problem solving - Six sigma - DMAIC
A problem solving approach to quality
Reactive rather than proactive.
Define the problem
what is the problem and can it be defined
Think of relationship between cost, quality and time
Measure the problem
How serious is the problem? as this will determine the speed of response and resources allocated
Analyse the problem
Understand the problem and identify the root cause
Implement the best solution
There are various ways to fix the problems, referring back to quality, cost or time.
Control the changes
change is often resisted and often difficult to manage
Training will be needed as will monitoring of results
General conditions for a successful six sigma quality programme
1. Ensure an increased focus on quality in the organisation i.e. change leaders
2. Make decisions based on facts and data not guesswork
3. Embed any new change with a process that everyone understands
4. Training will be needed
5. collaboration is likely and preferable between business units and departments
Bottom up - Kaizen
Kaizen means improvement by continual small steps. specific principles are
1. Management establish a target or baseline cost with the expectation that costs will reduce and quality will improve gradually.
2. Operationally driven improvements - not strategic and suggested by staff
3. Improvements are suggested by staff who are seen as part of the solution not source of problems. staff empowerment is common and important as is team working
4. waste driven out of the business
5. will rarely improve an strategic change only small continuous improvements
waste removal - lean production
Lean production is how avoid wate in production, wate can occur in a number of way and LP seeks to tackle all of these
- Over or excess production - excess production may not be capable of sale and hence is wasted.
A closer alignment of production to demand prediction is needed here or even demand led production. - Waiting - This refers to delays that occur whilst staff wait for Info or resources or other people. e.g. stock outs, delayed reports. waiting is waste
Supply chain reliability, promote communication and reporting will eliminate waiting - Excess motion - moving excessively in warehouse of raw materials or WIP is wasteful and time consuming. warehouse and manufacturing space needs to be well organised to keep motion low.
- Transportation - sourcing supplies from afar is costly and potentially wasteful. local supplies are preferred and a distributed manufacturing base. consider economy and efficiency of scale.
- Over processing - excessive functionality of a product often unused by a product. Remove all non value added processes that customers do not use.
6 .Excess inventory - Excess stock may not be saleable or might be damaged. Stock management is needed and demand led production as well.
- Defective units - Internal failures are wasteful and a TQM programme may be needed here.
Lean MIS
Based on similar ideas of eliminating waste but the focus is on information system and reports generated.
General ideas are
1. Avoid duplication
2. Provide only relevant data
3. make it easily accessible to avoid wasting time
4. Avoid waste by only producing reports and info that is needed.
waste removal - Just in time
Just in time
1. Demand lead philosophy
2. Only produce goods as needed, no stock until customer orders
3. limited stocks if any
4. probably needs - flexible production systems and good quality and
suppliers.
5. Should lead to flexibility in product offering - colour, style, fabric
6. Increased risk of production stoppages
KPIS
% of late delivery
product range data
Target costing
The opposite of cost plus pricing
The existence of cost gap is problem for cost reduction not quality.
approaches to cost reduction
1. New suppliers
2. Discounts from suppliers
3. Deskilling the labour
4. improved efficiency
5. value engineering reduction of non value added features.
