INDUCTION PROGRAMME FOR DIRECT RECRUIT

JWM(OP)

READING MATERIAL

QUALITY MANAGEMENT

ORDNANCE FACTORIES INSTITUTES OF LEARNING

DEHRADUN, MEDAK, AMBERNATH

Restricted to participants only.

 INDEX

1. BASIC STATISTICAL CONCEPT ........................................................... 2

2. STATISTICAL QUALITY CONTROL..................................................... 19

3. QUALITY CONTROL (QC) TOOLS....................................................... 31

4. PROCESS CAPABILITY STUDY .......................................................... 54

5. ISO 9000 ................................................................................................ 61

6. QUALITY COST..................................................................................... 73

07. FMEA ………………………………………………………………………………………..85

08. Internal Audit………………………………………………………………………………..92

09. iso 9001……………………………………………………………………………………..101

10. Six Sigma……………………………………………………………………………………120

11. TPM…………………………………………………………………………………………125

12. ISO-9001 : 2000 and Guidelines for Applicants IS/ISO-9001:2000…………………….129

1
 1. BASIC STATISTICAL CONCEPT

DATA COLLECTION AND PRESENTATION

INTRODUCTION

Statistics may be defined as the science of collection, presentation, analysis and interpretation
of numerical data

Data are always collected with an intention to take an action. The aim of collecting data
is usually one of the following:

a) Analysis of survey
b) For control
i) For policy setting
ii) For adjustment
iii) For checking

c) For inspection

FUNCTIONS OF STATISTICS IN DATA COLLECTION & PRESENTATION

1. Systematic collection and presentation of facts

Statistics ensures that data is collected in a systematic manner & presented

without any subjective bias.

2. Simplification of mass figures

The large mass of data collected is transferred into a few figures which help in
analysis and interpretation.

3. Facilitates comparison

It enables impartial and fair comparison of data across a wide range of competing
alternatives.

4. Helps in prediction

Statistical methods are a very useful tool in attending to forecast the future.

5. Helps in policy formulation and decision making

Today almost all organizations make plans for efficient working and formulating
policy decisions.

2
COLLECTION OF DATA

Data are collection of any number of related observations. A group of data is called data
set and single observation is called data point.

Collection of data is a very critical step in statistical analysis. Data can be collected by
internal records, primary and secondary records
• INTERNAL DATA – It refers to data available from records by an organisation on a routine
basis. However, it is often incomplete and needs to be supplemented with primary or
secondary data.

• PRIMARY DATA – It refers to the data collected for the first time and is original in character.
Primary data is essentially raw and statistical methods will have to be applied on such data for
the purpose of analysis and interpretation.

• SECONDARY DATA – Data which are not originally collected but are obtained from published
or unpublished sources are called Secondary data.

Secondary data should be used after subjecting it to a thorough and careful scrutiny.

METHODS OF COLLECTION OF DATA

1. Direct personal interviews

2. Indirect oral investigation
3. Information through local agencies
4. Mailed questionnaire method

BASIS OF CLASSIFICATION OF DATA

1. Geographical
2. Chronological
3. Qualitative
4. Quantitative

PRESENTATION OF DATA

An important aspect of statistic is to summarise and present data to convey critical

information quickly. Data can be presented in the form of statistical table or in the form of
statistical charts.

SOME STATISTICAL TERMS

• Variable or variate – a characteristic which can be expressed numerically

• Frequency – the number of times each variate occurs

• Frequency distribution – a classification showing different values of a variate and the

corresponding frequency

3
• Individual observations – it represents a series where items are listed simply after
observation

• Discrete series – items arranged in such a manner that each unit of data is separate and
complete

• Continuous series – when data can take any value without any gap, the series becomes a
continuous series.
Before preparing frequency distribution table let us understand certain terms.
• Class limit – the class limit are the lowest and highest values that can be included in the
class. for eg:- in class 10-20, 10 is the lowest limit and 20 is the highest limit.
• Class intervals – the difference between the upper and lower limit of a class is known as
class interval.

ƒ Exclusive method – in exclusive method the upper limit of the class is excluded from that
class and is included in the next class.

ƒ Inclusive method – the upper limit of the class is included in the class itself.

FREQUENCY DISTRIBUTION TABLE FOR DISCRETE SERIES

In a frequency distribution table for a discrete series, frequency of a variate is shown against it.

Steps for preparation of frequency distribution table for a discrete series.

STEP 1 : List all the possible values of the variables in order.
Arranged from the lowest to the highest in first column.
STEP 2: Look at each value provided in the data and put a tally
across that value in column second. Proceed the same
way and draw a tally bars for all the items.
Count the number of bars and put the final tally in the last
column.

Eg: Frequency distribution for the following data

0,2,3,10,4,6,3,5,5,3,7,3,2,8,0,9,2,10,5,2,1,0,8,4,2
Sol: Arrange all the possible values from lowest to highest in column 1

Variate Tally bars Frequency

0 III 3
1 I 1
2 IIII 5
3 IIII 4
4 II 2
5 III 3
6 I 1
7 I 1
8 II 2
9 I 1
10 II 2

4
FREQUENCY DISTRIBUTION TABLE FOR CONTINUOUS SERIES

Step 1: Find out smallest and largest values in the distribution and
find the difference between them.

Step 2: Decide the number of classes in the range of 6-15 classes.

The number of classes can be arrived at by dividing the range with
the desired class interval.

Step 3: In the absence of instructions adopt exclusive method.

Step 4: Prepare frequency table by putting class interval in column 1,

tally bars in column 2 and frequency in column 3

Eg: Form a frequency distribution by taking suitable class interval for the following data of ages
of 52 employees in govt. agency.

64 34 36 48 49 31 51 34 43 45 38 32 28 61 29 47 36 50 46 30 46 32 30 33 45 49
48 41 53 36 37 47 30 46 50 28 35 35 38 46 43 34 36 62 69 50 28 44 43 60 39

Sol: The smallest value is 28 & largest is 69

Difference is 69-28 = 41
Form a class interval of 5, there will be nine classes.

FREQUENCY DISTRIBUTION OF AGES OF EMPLOYEE

AGES TALLY BARS FREQUENCY

25-30 IIII 4
30-35 IIII IIII 10
35-40 IIII IIII 10
40-45 IIII 5
45-50 IIII IIII III 13
50-55 IIII 4
55-60 - -
60-65 IIII 4
65-70 II 2

TOTAL 52

DIAGRAMMATIC AND GRAPHICAL REPRESENTATION DATA

The impression created by a picture has much greater impact than any amount of
detailed explanation. Statistical data can be effectively presented in the form of diagrams and
graphs. Graphs and diagrams makes complex data simple and easily understandable.

5
BAR DIAGRAM

The bar diagram are used specifically for categorical data or series. It consists of a group
of equidistant rectangles, one for each category or group of data in which the values of
magnitudes are represented by the length or height of the rectangle. The width of the rectangle
is immaterial.
Bar-Diagram presenting the number of accidents reported during Jan-June 2005

Factory Minor Major Fatal Total

AFK 16 4 0 20
HEF 5 1 0 6
OFBA 1 0 3 4
OFCH 4 3 0 7
OFI 7 4 0 11
OFK 12 7 0 19

20

15
Fatal
10 Major
Minor
5

0
AFK HEF OFBA OFCH OFI OFK

PIE DIAGRAM

It enables to show the breakup of a given total into various component parts. In order to
construct a pie diagram, equate the total number of all values to 360 degree by drawing a
circle. For each component find the number of degrees that can be assigned to it. When all
components are taken care of the circle would be split in the proportion of various
components to the total.

6
 Present the following data through a pie diagram.

Item Food Clothing Rent Education Others

Amount 1000 400 500 450 350

13%
36% FOOD
17%
CLOTHING
RENT
EDUCATION
OTHERS
19% 15%

GRAPHS OF FREQUENCY DISTRIBUTION

Frequency graphs are designed to reveal clearly the characteristic features of a

frequency data.

HISTOGRAM

A histogram is a graphical method of presenting data, where the observations are located on
horizontal axis and the frequency of those observations is depicted along the vertical axis.

Each class interval is drawn on the X axis to the magnitude of the class interval. On each
class interval base, erect a rectangle with height proportional to the corresponding frequency
of the class. The series of adjacent rectangles so formed gives the histogram of the
frequency distribution.

Draw the Histogram for following data

Income no of persons
0-20 4
20-40 16
40-60 28
60-80 32
80-100 26
100-120 12
120-140 6

7
 35
0-20
30
20-40
25
40-60
20
60-80
15
80-100
10

5 100-120

0 120-140
no of persons

FREQUENCY CURVE

It is a smooth free hand curve drawn through the vertices of a frequency polygon.

There are two types of cumulative frequency curves or ogives.

1. Less than ogive :

To construct this curve, plot the ‘less than’ cumulative frequencies against the upper class
boundries of the respective classes. It is upward slopping from left to right.

2. More than ogive:

To construct this curve, plot the ‘more than’ cumulative frequencies against the lower
class boundries of the respective classes. It is downward slopping from left to right.

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FREQUENCY CURVE FOR THE ABOVE DATA

35
30
25
20
no of persons
15
10
5
0

0-20 20-40 40-60 60-80 80-100 100-120 120-140

ARITHMETIC AVERAGE OR MEAN

Averages give us an idea about the concentration of the value in central part of the
distribution. It is the value which is representative of the entire distribution. It is easy to
understand and easy to calculate. It is a single value that represents a whole series.

Mathematical average

It is obtained by dividing the total values of the various items by their number.

INDIVIDUAL OBSERVATION

DIRECT METHOD

_ ∑X
X = --------
N
_
X - Arithmetic Mean
∑ X – Total of the size of the items
N – No. of items

Steps: (1) Add all the values of variable X

(2) Divide this total by number of items

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(b) SHORT CUT METHOD

_ ∑d
X = A + ----
N
_
X – Arithmetic Mean
A – Assumed Mean
∑d – Total of deviations from assumed mean
N – No. of Items

STEPS FOR CALCULATING MEAN BY ASSUMED MEAN METHOD

1. Take an assumed mean

2. Take the deviations from the assumed mean, d’
3. Obtain the total of deviations, ∑d ’
4. Apply formula

Ex. Calculate the arithmetic mean for the following data

Family: A B C D E F G H I J
Income: 90 75 60 100 125 50 80 120 500 400

By short cut method:

Family Income d = X-150

A 90 - 60
B 75 - 75
C 60 - 90
D 100 - 50
E 125 -25
F 50 -100
G 80 - 70
H 120 - 30
I 500 350
J 400 250
_____ _______
N = 10 ∑ d = 100
_ ∑d
X = A + ----
N
= 150 + 100
10
= Rs. 160

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DISCRETE SERIES

(a) DIRECT METHOD

_ ∑ fX
X = ------
N
∑ fx – Total of the size multiplied by their respective frequency
N – Total of frequency

(b) SHORT CUT METHOD

__ ∑fd
X = A + -------
N
A – Assumed mean
∑ f d – Total of the deviations from assumed mean multiplied
with frequency
N – Total of frequency

STEPS

1. Take an assumed mean

2. Take the deviations of the size from the assumed mean
3. Multiply these deviations with respective frequencies, ∑ f d
4. Apply formula

Ex. Calculate the arithmetic mean for the following data

Value: 10 20 30 40 50 60
Frequency: 5 15 25 20 10 5

Value Frequency (x-40) fd

x f d
10 5 - 30 - 150
20 15 - 20 - 300
30 25 - 10 - 250
40 20 0 0
50 10 10 100
60 5 20 100
______ __________
N = 80 ∑ f d = - 500

_ ∑fd
X = A + -------
N
-500
= 40 + --------
80
= 40 - 6.25 = 33.75

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CONTINUOUS SERIES

DIRECT METHOD

__ ∑ f m
X = --------
N
∑ f m – Total of frequency multiplied with mid values
N – Total of frequency
STEPS
1. Obtain the mid points of each class, m
2. Multiply the mid points by respective frequencies, ∑fm
3. Divide the total so obtained by total of frequency

(b) SHORT CUT METHOD

__ ∑fd’
X = A + ------- x C
N
A – Assumed Mean
∑fd’ – Total of the deviations from assumed mean multiplied
with frequency
N – Total of frequency
C – Common Factor
STEPS
1. Ascertain the mid values of each class
2. Take an assumed mean, A
3. Calculate the deviations from assumed average, d
4. Ascertain the common factor and divide all deviations by common factor
5. Multiply the frequency with deviations and obtain the total, ∑fd’
6. Ascertain the total frequency and apply formula

Ex. Calculate the arithmetic mean for the following data

Value: 0-10 10-20 20-30 30-40 40-50 50-60 60-70 70-80 80-90
Frequency: 1 4 10 22 30 35 10 7 1

By short cut method

value mid-value frequency (m – 45) step deviation fd’
x m f d d’ = d/10

0-10 5 1 - 40 -4 -4
10-20 15 4 - 30 -3 - 12
20-30 25 10 - 20 -2 - 20
30-40 35 22 - 10 -1 - 22
40-50 45 30 0 0 0
50-60 55 35 10 1 35
60-70 65 10 20 2 20
70-80 75 7 30 3 21
80-90 85 1 40 4 4
______ _______
N = 120 ∑fd’= 22

12
 __ ∑fd’
X = A + ------- x C
N
22
= 45 + ------- x 10
120

= 46.83

DEMERITS OF ARITHMATIC MEAN

• Arithmetic mean may lead to wrong conclusions if the details of the data from which it is
computed are not given.
• In extremely asymmetrical distribution arithmetic mean is not a suitable measure of
location.
• Arithmetic mean cannot be calculated if the extreme class is open. Moreover, if a single
observation is missing mean cannot be calculated.
• It cannot use if dealing with qualitative characteristic.

MEASURES OF DISPERSION

Dispersion is the measure of the variation of items. it measures the extent to which the items
very from central value. Measures of dispersion show the average of the differences of
various items from an average.
Following are important methods
1. Range
2. Standard deviation

RANGE

It is the difference between the values of the extreme of a series

RANGE = LARGEST – SMALLEST

STANDARD DEVIATION

Standard deviation is the square root of the arithmetic average of the square of the deviations
measured from mean

Standard deviation is denoted by small Greek letter (σ) Sigma

Calculation of standard deviation

• INDIVIDUAL OBSERVATION

1. BY TAKING DEVIATION OF THE ITEMS FROM THE ACTUAL MEAN

∑x2
S.D. (σ) = -------
N

13
Steps:

1. Calculate arithmetic mean of the series

2. Take the deviations of the items from the mean, x
3. Square the deviations and obtain total, ∑x2
4. Divide the total by total number of items and find the square root

Ex : Compute the Standard deviation for the following data.

120, 100, 160, 100, 220, 130, 150, 170, 150, 200
__
2
X X–X x
120 -30 900
100 -50 2500
160 10 100
100 -50 2500
220 70 4900
130 -20 400
150 0 0
170 20 400
150 0 0
200 50 2500
2
∑x = 1500 ∑x = 14200 N = 10
__ ∑x
X = --------
N
= 1500
10

∑x2
σ = ---------
N

14200
= --------
10

= 37.68

2. DEVIATIONS FROM ASSUMED MEAN

∑ fd2 ∑fd 2

σ = ------- - -------
N N

14
 ∑fd2 - Total of the squares of the deviations from assumed
mean
∑fd - Total of the deviations from assumed mean
N – Total number of items

STEPS

1. Take the deviations from assumed mean, d

2. Square these deviations & obtain total, ∑d2
3. Apply the formula

Ex : Compute the Standard deviation for the following data.

120, 100, 160, 100, 220, 130, 150, 170, 150, 200

X X – 140 d2
120 -20 400
100 -40 1600
160 20 400
100 -40 1600
220 80 6400
130 -10 100
150 10 100
170 30 900
150 10 100
200 60 2500
2
N = 10 ∑d = 100 ∑d = 15200

∑fd2 ∑fd 2

σ = ------- - -------
N N

2
15200 100
σ = ------- - ----
10 10

= 37.68

• DISCRETE SERIES

1. ASSUMED MEAN METHOD

∑fd2 ∑fd 2

σ = ------- _ -------

15
 N N

STEPS

1. Take the deviations from assumed mean, d

2. Multiply these deviations by the respective frequencies, ∑fd
3. Square these deviations d2 & multiply with respective frequencies,
∑ fd2
4. Apply the formula

2. STEP DEVIATION METHOD

∑ fd’2 ∑fd’ 2

σ = ------- - ------ x C
N N

∑ fd’2 - Total of frequency multiplied with squares of the deviations from

assumed mean
∑fd’ - Total of the frequency multiplied with deviations from assumed
mean
C - Common factor

Ex : Compute the Standard deviation for the following distribution

Value 5 15 25 35 45 55 65
Frequency 3 10 20 30 15 12 10
By assumed mean method (here A=35), common factor C = 10

X f (X-35) = d d/10 = d’ fd’ d’2 fd’2

5 3 -30 -3 -9 9 27
15 10 -20 -2 -20 4 40
25 20 -10 -1 -20 1 20
35 30 0 0 0 0 0
45 15 10 1 15 1 15
55 12 20 2 24 4 48
65 10 30 3 30 9 90

N = 100 ∑fd’ = 20 ∑ fd’2 =240

2
∑fd’2 ∑fd’
σ = ------ - ------ x C
N N

16
 2 = 15.36
σ = 240 _ 20 x 10
100 100

• CONTINUOUS SERIES

BY STEP DEVIATION METHOD

2
∑ fd’2 ∑fd’
σ = ------- - ------ x C
N N

∑ fd’2 - Total of frequency multiplied with squares of the deviations from

assumed mean
∑fd’ - Total of the frequency multiplied with deviations from assumed
mean
C= Common factor

STEPS

1. Find mid points of various classes

2. Take deviations from this mid points from an assumed mean (d)
3. Take common factor of the deviations, d’
4. Multiply frequency with d’ obtain ∑fd’
5. Square the deviations, d’2
6. Multiply the frequencies with d’2 obtain ∑fd’2, apply formula

CO-EFFICIENT OF VARIATION

It is used in such problems where variability of two or more series is to be compared.

The series having greater co-efficient of variation is more variable or less consistent. The
series for which co-efficient of variation is less, is said to be less variable or more consistent.

S.D.
C.V. = x 100
X

Exercise for calculation of mean & standard deviation:

1. The production of a radar component is checked by examining samples of 4. The table

shows number of defectives found in 200 samples.

No. of defectives: 0 1 2 3 4
No. of samples: 62 85 40 11 2

17
 Calculate: 1. The mean no. of defectives.
2. The standard deviation of number of defectives.

2. The table shows the distribution of life time of radio valves tested at the
Laboratory.

Life time ( Hrs.) No. of tubes

300-400 14
400-500 46
500-600 58
600-700 76
700-800 68
800-900 62
900-1000 48
1000-1100 22
1100-1200 6

Calculate: 1. The mean no. of defectives.

2. The standard deviation of number of defectives.

3. Test of stiffness of number of aluminum alloy channel gave the following distribution.

Stiffness frequency Stiffness frequency

2640 1 2360 35
2600 2 2320 22
2560 7 2280 14
2520 11 2240 5
2480 25 2200 3
2440 33 2160 1
2400 41

Calculate: 1. The mean

2. The standard deviation

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 2. STATISTICAL QUALITY CONTROL

INTRODUCTION

The desire to control the quality of produced item is as old as the man's ability to produce it. The
first effort at quality control by way of duplication resulted in rather crude copies of the original
object. As the time went on, man developed skills at duplicating things.

It was not until the early 1800s that man began to realize that tolerances were necessary.
Thus, the use of 'go' tolerances came into being. It was not until the late 1800s that 'not go'
tolerances came into general use.

QUALITY CONTROL

Quality control may generally be defined as a system that is used to maintain a desired
level of quality in a product or service.

The task may be achieved through different measures such as

♦ Planning
♦ Design
♦ Use of proper equipments and procedures
♦ Inspection
♦ Taking corrective action in case of deviation

According to, JIS (Japanese Industrial Standard) standard Z8101-1981, Quality control is
defined as follows :-

"A system of methods for the cost effective provision of goods or services whose quality is fit
for the purchasers requirement."

Quality control consists of developing, designing, producing, marketing and servicing

products and services with optimum cost effectiveness and usefulness which customer will
purchase with satisfaction.

To perform quality control effectively, the entire staff of an enterprise from top executives
down through managers and supervisors to ordinary workers must participate and collaborate in
it at every stage of the enterprises activities, including market surveys, research and
developments, product planning, design, preparation for production, procurement, sub
contracting, manufacturing, inspection, sales and after sales service as well as finance,
personnel affairs and education, quality conducted in this way is called ‘Company Wide Quality
Control’ (CWQC) or Total Quality Control (TQC).

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 MEANING OF QUALITY

♦ ISO 9000: 2000 defines quality as 'quality is the degree to which a set of inherent
characteristic fulfils requirement'.

♦ Quality is conformance to requirements or specification (Crosby)

♦ Quality is fitness for use. (Juran)
♦ The quality of product or service is the fitness of that product or service for meeting its
intended use as required by customer. (Hence)

The word 'quality' has come to have a set of different meanings. The most useful meaning
given to quality includes:
1. Fitness for use
In earlier times fitness for use refers to the degree to which a specific product or services
satisfied the wants of a specific user. The following are the different parameters of
fitness for use:
a) Quality or design or grade
b) Quality or conformance
c) Availability
d) Customer service

2. Grade
This is the degree to which a class or category of product possess satisfaction for people
generally.

3. Quality of conformance
This is the degree to which a specific product conforms to a design or specification.

4. Quality characteristic
This is any distinguishing feature of a grade or a product i.e. appearance, dimension,
performance, length of life, dependability, reliability, durability, maintainability, taste,
ordour etc.

5. The Quality function

This is the name for that area of responsibility in industrial companies through which we
achieve fitness for use.

QUALITY CHARACTERISTIC

Quality characteristic may be one or more elements, which defines the intended quality
level of a product or service.
Several grouping of these characteristic can be formed in:
♦ Structural characteristic include such element as the length, weight, strength, viscosity
and so on.
♦ Sensory characteristic include the taste, smell and beauty among others.
♦ Time oriented characteristic includes such measures as a warranty, durability and
maintainability.
♦ Ethical characteristic include honesty, courtesy and friendliness and so on.

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 HISTORY OF QUALITY CONTROL

♦ In 1964, Pascal, the French philosopher and mathematician become interested in games
of chance.
♦ During the 1800s, considerable progress was made in development of sampling theory.
♦ In 1924, Dr. Walter A. Shewart of Bell Telephone Laboratories of United States invented
control charts.
♦ British standard came into existence in 1935.
♦ During the world war II, American Standard Association invented standards known as
Z1.1 - Z1.3
Z1.1 - Guide for quality control
Z1.2 - Methods for analysing data
Z1.3 - Controlling quality in production

♦ Utilization of sampling techniques in 1944 by H.F. Dodge and H.G. Roming

♦ In 1946, American Society for Quality Control (ASQC) has been founded.
♦ In 1946, Japanese Union of Scientist and Engineers (JUSE) was setup.
♦ In 1950, JUSE invited Dr. W.E.Deming from US to conduct seminar on QC.
♦ In 1954, Juran was invited in Japan
♦ In 1960, Quality circle activity started in Japan
♦ In 1960, Zero defect programme started in America
♦ In 1970, TQM started in America
♦ In 1980, Taguchi methods introduced in America
♦ In 1989, Six Sigma approach (Motorola) started in America

Quality movement in India was launched in the early 1950’s and the progress is still at low ebb.

STATISTICAL QUALITY CONTROL

Statistical methods are extremely helpful and are often used in quality control. For this
reason quality control is often called STATISTICAL QUALITY CONTROL. (SQC)

Statistics and statistical methods are continuing to make great advances, but it is not
necessary to know all about them to promote quality control.

The statistical methods should be divided into introductory, intermediate and advance
grades, with due regard to the actual conditions in the work places where the methods will be
used.

Introductory statistical tools includes :

1. Pareto diagram
2. Cause & effect diagram
3. Stratification chart
4. Check sheet
5. Histogram & frequency distribution
6. Scatter diagram
7. Graphs and control charts

21
 The common characteristic of the above seven QC tools is that they are all visual, in the
form of chart, graphs or diagrams. The seven QC tools, if used skillfully, will enable 95% of the
work place problem to be solved. Intermediate and advanced statistical tools are needed in only
about 5% of cases.

The following are intermediate methods:

1. Distribution of statistics, statistical estimation and testing.

2. Sampling estimation.
3. Introduction to design of experiment.
4. Simple correlation and regression analysis.

The following are the advance methods:

1. Advance design of experiment.

2. Multi variate analysis
3. Time series analysis
4. Other methods

In Quality control, statistical tools are used in the following areas:

1. Surveys: Market survey, surveys of measuring methods
2. Policy setting and goal setting.
3. Analysis and improvement : Process analysis and Quality analysis.
4. Control and management: Process control, work management
5. Quality assurance and inspection: Sampling inspection, quality assurance.

VARIATION

Variation seems inevitable in nature. One of the characteristic of modern manufacturing

process is that no two pieces are ever made exactly alike. Some variations are so great that
they are immediately shown by modern measuring equipment. Other variations are so minute
that successive reading on measuring equipment will reflect primarily the variation of the
measuring equipment rather than that of the part.

The following are the useful classification of variance:

1) Variation within the part itself

2) Variations among part produced during the same period of time
3) Variation among part produced at different period of time

There are four factors that contribute to these variation, and they are process, materials,
operations and miscellaneous.

The first source of variation is process. The source includes tool wear, machine
variations, work holding – device positioning and hydraulic and electrical fluctuations. The
second source of variation is the material. Since variation occurs in the finished product, it must
also offer in the raw material. For example such quality characteristics as tensile, strength,
ductility, thickness, porosity and moisture content. Third and possibly the greatest source of
variation is operator.

22
 The source of variation includes the methods by which the operator performs the operation.
The operator’s physical and emotional well being also contribute to the variation. The forth
source of variation is miscellaneous. The source includes environmental factor, such as heat,
light, radiation and humidity.

As long as these four sources of variation fluctuates in a normal or expected manner, a

stable pattern of many chance causes of variation develops.

COLLECTION OF DATA

Before collection of data, the purpose for which the data is collected is to be defined first.
Data may be collected by direct observation or indirectly through written or verbal questions.

Variables are those quality characteristic which are measurable such as weight,
dimension etc.

Attributes are those quality characteristic which are classified as either conforming or not
conforming to specifications. In other words, attributes are either good or bad.

A variable that is capable of any degree of subdivision is referred to as continuous.

Measurement such as meters, litres etc.

Variables that exhibit gaps are called Discrete.

FREQUENCY DISTRIBUTION

The raw or ungrouped data, are difficult to use and are not effective in describing the
data’s characteristic.

The way to organise such figures to show their patterns of variance is to count the
number of times each value occurs. The result of such counts are called frequency distribution.

The frequency distribution immediately tells us where most of the data are grouped and
how much variation there is in the data.

A grouped frequency distribution of a set of observations is an arrangement which shows

the frequency of occurrence of the values of the variables in ordered cell. The frequency of any
cell is the number of observations in that cell. The relative frequency of any cell is the frequency
for that cell divided by total number of observations.

PICTORIAL REPRESENTATION OF FREQUENCY DISTRIBUTION

HISTOGRAM

A histogram consists of a set of rectangles with bases that represent cell mid points and
with height that represent the frequency in a cell.

23
ANALYSIS WITH HISTOGRAM

After constructing the histogram, if we draw the specification limit, the histogram can
illustrate the following:
1. Is the product consistent with previous checks?
2. Is the product well centered?
3. Does it appear that the product is meeting engineering specifications?
If histogram is roughly symmetrical, it is an indicative of the fact that overall process is
normal and that variations may be due to chance, causes, the average is close to the
specification midpoint, implying that the process is well centered.

If the spread is greater than the specification limits, it indicates that the process will have
to be improved.

Histogram often reveals, without elaborate analysis, much information about the process
or product under observation and because they are easily understood by operating
personnel can materially aid in making improvement.

USES OF HISTOGRAM

1. Assessing material strength

2. Evaluating processes
3. Indicating necessity for corrective action
4. Measuring the effect of corrective action
5. Determining the machine capabilities
6. Comparing operators
7. Comparing materials
8. Comparing vendors
9. Comparing products

LIMITATIONS OF HISTOGRAM

1. It requires many measurements

2. It does not take time into consideration
3. It does not separate the two kinds of variations – variation due to chance & variation due
to assignable factors
4. It does not show trends.

Twelve typical variation examples using histograms

01. An ideal situation where the spread is substantially within the specified limits and the
distribution is well centered.
02. The distribution is off-centre with parts outside the upper limit.
03. A distribution with a spread approximately the same as the specification limits, well
centered and satisfactory.
04. A distribution with a spread approximately the same as at 3 which has drifted off-centre with
parts beyond specification.
05. A distribution with a spread greater than the specification limits with parts outside both
limits.
06. A bimodal distribution suggesting that two different machines, two different materials, or two
different products are involved.

24
07. A double distribution with a total spread greater than at 6 resulting in increased rework and /
or scrap.
08. A process operating off-centre where pieces have been 100 per cent inspected and the
defective ones removed. This could also indicate eccentricity readings or some other
variable where only positive values can be measured.
09. A process resembling or 8 in which 100 percent inspection has not been entirely effective.
10. A process similar to at 8 or 9 indicating a salvage limit, a
• gauge set up incorrectly, or an operator having difficulty in
• deciding borderline cases.
11. A well-centered principal distribution with another small distribution that may be the result of
including set up in the lot.
12. A distribution where the operator has favoured certain readings because the judging was
inadequated or difficult to interpret.

Figure showing twelve typical variation examples using histograms

25
CONTROL CHARTS

Control charts includes all types of charts and graphs used for control purposes. They
have been used for long time, ever since Dr. W.A. Shewart first utilized in 1926. Control charts
can be classified into the three main types, according to the nature of data they depict.

1. The X bar – R chart

These type of chart is used when the process characteristic to be controlled is a

continuous variable such as length, weight, strength, purity, time etc. The x bar and R
charts are generally used together, since only their combined use enables us to identify the
changing state of a process in the form of distribution. Of all the different types of control
charts, these two give us the most technical information, which makes it extremely useful for
technical analysis and process capability studies.

2. The P chart and PN chart

When controlling a process in which the vital characteristic is an attribute such as number
of defective items in a sample of certain size.

The p chart is used when the number of defective items in a sample is expressed as
fraction defective (p), while pn chart is used when it is expressed as number of defective (pn)

3. The C chart and U chart

These charts for attributes are used when we are concerned with the variation in the
number of defects in a single item of products e.g. number of cracks, splits, scratches or
stains on the surface.

BENEFITS OF QUALITY CONTROL

Following are the some benefits of implementation of quality control:

ƒ Quality is raised, and number of defective products decreases.
ƒ Quality becomes more uniform and the number of complaints decreases
ƒ Reliability increases, confidence in the products improves and the customer trust is
obtained.
ƒ Costs decreases.
ƒ A quality assurance system is established.
ƒ Complaints are dealt with more quickly and effective action is
taken to prevent their occurrence.
ƒ Unit costs improve and value added productivity increases.
ƒ Rework decreases and efficiency increases.
ƒ Inspection and testing cost decreases.
ƒ Research and development is speeded up and made more effective.
ƒ Decision making is speeded up, policy development and management by objective
improve.
ƒ The entire company works together and a system of cooperation is established.

26
ACCEPTANCE SAMPLING

Acceptance sampling is the process of evaluating a portion of the product in a lot for the
purpose of accepting or rejecting the entire lot as either confirming or not confirming to a quality
specification.

The main advantage of sampling is economy. Despite some added cost to design and
administer the sampling plans, the lower cost of inspecting the only part of the lot result in an
overall cost reduction.

There are other advantages of sampling:

1. The smaller inspection staff is less complex and less costly to administer.
2. There is less damage to the product i.e. handling incidental to inspection is itself a
source of defect.
3. The lot is disposed of in shorter time so that scheduling and delivery are improved.
4. The problem of monotony and inspection error induced by 100% inspection is minimised.
5. Rejection of non confirming lots tends to dramatize the quality deficiencies and to urge
the organisation to look for preventive measures.

The disadvantage of accepting sampling are sampling risk, administrative cost and less
information about the product than is provided by 100 % inspection.

ACCEPTANCE SAMPLING IS USED WHEN:

1. The cost of inspection is high in relation to the damage caused resulting from passing a
defective.
2. 100 % inspection is monotonous and causing inspection errors.
3. The inspection is destructive.

THE CONCEPT OF SAMPLING

The measurements in a sample provide two types of information:

1. Information about the product in the sample. This permits decisions about the product in
the sample itself.
2. Information about the variables present in the manufacturing process. This leads to
conclusions about the process at the time the sample was taken.

The knowledge of the process, in turn, gives information about the uninspected product.
Acceptance sampling is valid because the unispected product came from the same process
which produces the sample of inspected product.

ECONOMICS OF SAMPLING VERSES 100 % INSPECTION

There are three alternatives for evaluating lots:

1. No inspection at all
2. Inspect a sample
3. 100% inspection

27
An economic evaluation of sampling versus 100% inspection requires a comparison of total
costs under each of the alternatives. Suppose it is assumed that no inspection error occur and
the cost to replace a defective found in inspection is borne by the producer or is small compared
to the damage done by a defective in use.
Then if,
N = number of item in lot
n = number of items in lot sample
p = fraction defective in lot
A = damage cost incurred if a defective slips through inspection
I = inspection cost per item

Total cost with no inspection = NpA

Total cost with 100% inspection = NI
And total cost with sampling = nI + (N-n)pA

If the cost with 100% inspection and sampling are equated, a break even point (Pb) may be
found in terms of fraction defective:

(N-n) I I
Pb = --------- = ---
(N-n)A A

If the fraction defective in the lot is less than Pb, the total cost will be lowest with
sampling. If P is greater than Pb, then using 100% inspection will result in a lowest total cost.

The variability in quality from lot to lot is important. If past history shows that the quality
level is much better than the break even point and is stable from lot to lot, little if any inspection
is needed. If the level is much worse than the break even point and consistently so, it will usually
be cheaper to use 100% inspection rather than sample.

FORMATION OF LOTS FOR ACCEPTANCE SAMPLING

Guidelines for formation of lots are as follows:

1. Lots should be homogenous which means that all product in the lot is produced by the
same machine, same operator, same input material and so on.
2. Lot should be as large as possible. Since sample sizes do not increase as rapidly as lot
sizes, a lower inspection cost results with larger lot sizes.
3. Lot should confirm to good packaging principle. Lots should be protected to prevent
additional defectives from offering during transist.
4. Lots should be suitable for materials handling.
5. If possible, lot should be packaged so that the selection and drawing of the inspection
sample is easily accomplished.

SAMPLE SELECTION

The sample pieces selected for inspection should be representative of the entire lot. All
sampling plans are based on the premise that each piece in the lot has an equal likelihood of
being selected. This is referred as random sampling.
The basic technique of random sampling is to assign a number to each piece in the lot.
Then a series of random number is generated that tells which of the numbered pieces are to

28
 be sampled and inspected. Random number can be generated from a computer, 20 sided
random number die and electronic calculator and so on.

Many products have serial numbers that can be used as the assigned number. This
avoids the difficult process of assigning numbers to each piece.

It is not always practical to assign a number to each piece or utilize a serial number.
Stratification of the lot with samples drawn from each stratum can be effective substitute for
random sampling. The technique is to divide the lot strata or layer. Each stratum is further
sub divided into cubes. The dividing of the lot into strata and cubes within each stratum is an
imaginary process done by inspector. By this technique pieces are selected from all
locations in the lot.

SINGLE SAMPLING, DOUBLE SAMPLING AND MULTIPLE SAMPLING PLAN

Single sampling calls for decision on acceptance or rejection of a lot on the basis of the
evidence of one sample from the lot.

In double sampling a lot may be accepted at once if the first sample is good enough or
rejected at once if the first sample is bad enough. If the first sample is neither good enough nor
bad enough, the decision is based on the evidence of the first and second sample combined.

There are four possibilities for acceptance or rejection of a lot submitted for double
sampling:
1. Acceptance after the first sample.
2. Rejection after the first sample.
3. Acceptance after the second sample.
4. Rejection after the second sample.

Just as double sampling plans may defer the decision on acceptance or rejection until the
second sample has been taken, other plans may permit any number of samples before a
decision is reached. The phrase multiple sampling is used when three or more samples of a
stated size are permitted and when the decision on acceptance or rejection must be reached
after a stated number of samples. It is generally used when a decision is possible after each
item has been inspected and when there is no specified limit on the total number of units to be
inspected.

CHARACTERISTICS OF A GOOD ACCEPTANCE PLAN

An acceptance sampling plan should have the following characteristics:

1. The index (AQL, AOQL etc.) used to define ‘quality’ should reflect the needs of the
consumer and producer and not be chosen primarily for statistical convenience.
2. The sampling risks should be known in quantitative terms. The producer should have
adequate protection against the rejection of good lots, the consumer should be protected
against the acceptance of bad lots.
3. The plan should minimize the total cost of inspection of all products.
4. The plan should make use of other knowledge, such as process capability, vendor data,
and other information.

29
 5. The plan should have built-in flexibility to reflect changes in lot sizes, quality of product
submitted.
6. The plan should be simple to explain and administrater.

SAMPLING BIAS

Unless rigorous procedures are set up for sampling at random and / or by stratification, the
sampling can deteriorate into a variety of biases which are detrimental to good decision making.
The biases consist of:
1. Sampling from the same location in all containers, racks, or bins.
2. Previewing the product and selecting only those units which appear to be defective.
3. Ignoring those portions of the lot, which are inconvenient to sample.
4. Deciding on a pattern of stratification in the absence of knowledge of how the lot was
made up.

Some forms of sampling bias can significantly distort the product acceptance decision, all
concerned should alert to plan the sampling to minimize these biases.

SAMPLING VERSES CONTROL CHARTS

To control the quality of work in process, either installing the control chart at the machine
or inspection of products by means of a sampling can be used.

Many process can be controlled by either method. In each individual case a decision has
to be made on the basis of the following facts:
1. The information obtained from control charts is superior to the one obtained from
sampling plan, because the control charts often sound a warning when a process is
going out of control even before defective product occurs. A sampling plan can only tell
that the process is out of control after the defectives have already been produced.
2. Sample size is much smaller under control chart system. But sometimes each sample
has to be tested very carefully. Sampling plans, although they require larger sample
size, involve merely a simple test or visual examination.
3. The amount of figure work to be done is greater when control chart is used.

Method Advantages Disadvantages

Control Charts Superior information More figure work
Small samples More pains taking tests
Sampling Plan Less figure work Less information
Sample tests Bigger sample

It should be realized that in practice there are one of the advantages or disadvantages
out weights all the rest. Therefore, it is preferable to classify each article ‘satisfactory’ or
‘defective’ and use a sampling plan.

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 3. QUALITY CONTROL (QC) TOOLS

SEVEN QUALITY CONTROL (QC) TOOLS :

INTRODUCTION

In QC problem solving approach, it is important to start by gathering the kind of data that will help
to grasp the facts. Then, such data is used to investigate the various factors (causes) considered
to be affecting the results, and check the relationship between the causes and the results. We
analyze the data, effect counter measures designed to produce more desirable outcomes and
control any factor that impairs the results. The tools we use for analyzing and handling the data
are known as the QC tools.

The QC tools are techniques, used in QC activities for discovering problems, organizing
information, generating ideas, analyzing causes, taking action, effecting improvement and
establishing control.

The Seven QC tools are named after the famous seven weapons of the Japanese
Kamakura-era warrior-priest Benkei, which enable him to triumph the battle.

HOW TO USE THE QC TOOLS SKILLFULLY

1) Establish Objective
Our efforts are waste if we start collecting data without knowing the objective of
data collection.
a) Understanding situation
b) Analysis
c) Checking results
d) Control
e) Inspection
f) Adjustment

2) Select Tool
Once objective is decided we must consider which tool are applicable and select
the most appropriate one.

3) Collect data :Before starting to collect data use five Ws and one H
a) How many readings
b) What period
c) How to stratify the data
d) What method
e) Who should collect, When & what process

4) Analyse data using QC tools

Analyse the data using different QC tools and compare the results.

5) Consider result and derive conclusions

Consider the analytic results with other technical information and experience and
draw conclusions.

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 6) Act : Take some specific action such as
a) When understood the situation – set improvement target
b) When identified cause of the problem – think up counter measure
c) When able to confirm results – standardize if results are good
d) When able to identify the state of control – take action if there are any
abnormalities and maintain status quo if none
e) When found defective articles – remove defectives
f) When found process requires adjustment – adjust it to bring back within control
limit

These are the first practical scientific tools, usable by anyone, in analysing and improving
process performance.

FOLLOWING ARE THE SEVEN QC TOOLS.

1. Pareto diagram
2. Check sheets.
3. Cause and effect diagram.
4. Stratification chart.
5. Scatter diagram.
6. Histogram.
7. Control charts.
1. PARETO DIAGRAM :
This diagram is named after an Italian economist Wilfredo Pareto, who found that all the wealth in
his country was owned by just a few people. In simplest term, the Pareto principle suggests that
most effects come from relatively few causes. In quantitative terms, 80% 0f the effects or
problems come from 20% of the causes. This concept is often called as the 20 – 80 rule. This rule
states that 20% of the categories will typically account for 80% of the observations. For example
20% of the products are found to cause 80%of the problems.
In other words, Pareto diagram is based on the principle “Vital few – trivial many“ Juran refer to
the 20% of the products as the “Vital- few” and the remaining 80% of the products as the “Trivial-
many”.
This diagram is used to analyse the data relating to problem, to decide which are the most
important factors to be tackled first to have most impact on problem.
It is always represented / converted in terms of money. This diagram enables us to identify the
serious problems that we are currently facing and enables us to achieve the tremendous benefits
by solving that.
STEPS:
01 Identify the types of non-conformities, collect the data and categorised them
defect wise.
02 Determine frequencies for the various categories.
03 List the non-conformities in descending order of frequency.
04 Plot the defects in x-axis and their relevant frequencies in left side y-axis (plot in the form
of bars).
05 Calculate the frequencies percentage for each defect and then calculate cumulative
frequencies Percentage.
06 Plot the cumulative frequency percentage by setting scale on right side of y – axis.

32
EXAMPLE :

Object: To plot the Pareto diagram for casting defects.

1000 nos. of casting are inspected out of which 400 Nos. of castings are having following
defects.

S.No. Defects Frequency Frequency % Cumulative

01 Crack 200 50% 50%

02 Folds 100 25% 75%
03 Scratch 50 12.5% 87.5%
04 Length ‘h’ 40 10% 97.5%
05 Others 10 2.5% 100%

Total 400

33
SOME POINTS TO NOTE WHEN INTERPRETING PARETO DIAGRAM

• Always start with the problems that will bring the maximum benefits if solved.
• If most frequent defects suddenly decreases, this shows that either the Improvements
efforts has succeeded or that process or factors have suddenly changed even though
nothing has been done.
• If the different types of defects decreases in an approximately uniform manner, this
generally shows that control has been improved.
• If the most frequent defects changes every month, but overall defects or loss ratio
does not decrease very much, this shows lack of control.

This diagram is a simple but extremely useful tool.

2. CHECK SHEETS:

A check sheet is a structured, prepared form for collecting data when the number of
times a defect or value occur is important.

PROCEDURE:

01 Decide what will be observed.

02 Decide when the data will be collected.
03 Design the format. Set it, so that data can be recorded simply by marking tally mark.
04 Label all the spaces on format.
05 Test the check sheet for a short trial period & be sure that it is as per requirement and
easy to use.
06 Whatever observations occurs, record that.

EXAMPLE :

Object: To collect the data for telephone interruption over a week time. What days are worst for
interruption? Which interruptions are more frequent?

Let us consider three types of interruption which generally occur, that may be wrong number,
information request & calls from boss. Observations for these interruptions over a week are
plotted as;

Reason Days Mon Tue Wed Thu Fri Sat Total

Wrong nos. IIII II I IIII I IIII I IIII 25

Information request II II III III II III 15
Boss IIII IIII III IIII I III III IIII I 30

Total 16 07 10 12 11 14 70

Conclusion: it is observed from the check sheet that worst days for interruption are Monday &
Saturday and calls from boss are more frequent interruptions.

34
3 CAUSE AND EFFECT DIAGRAM:

It is valuable tool for obtaining the maximum information. It is developed by Ishikawa in 1943. It
is also called as Ishikawa diagram and some time fish bone diagram.
It is a visual sketch using lines and symbols to show the linkage between the effect and the
causes of that effect. The diagram is drawn backward. First the effect is stated, then the causes
of this effect are determined.
The idea of the concept is that this knowledge could lead to the root causes of a problem and
then to its solution.
It is very much useful when a team is trying to find potential solutions to a problem and is looking
for the root causes. One of the most valuable attribute of this tool is that it provides an excellent
means to facilitate a brain storming session. It will enable the participants to focus on the issue
at hand and immediately allow them to sort ideas into useful categories.

Once a non-conformity has been observed, attention shifts to analyse the reasons, why deviation
caused. Sometimes considerable amount of investigation is required to uncover the causes of
the problem or effect.

PROCEDURE: following are the steps to construct a cause and effect diagram.

01 Select a problem or effect.

02 Brainstorm all possible causes of the problem or effect.

03 Classify the major causes under the headings: materials, methods, machines and
manpower.

04 Draw a cause and effect diagram: write the effect on centre right and draw a box around
it. Now draw a horizontal arrow running to it (main arrow). Further, draw the branches
from the main arrow for major causes.

05 Analyse the causes and take corrective action.

One of its most important salient feature is that it tends to make people aware of
production problems of several areas and to get them involved in solutions.

C & E diagram gives us a chance to:

• Discuss about factors playing roles.

• Control the factors one by one.
• Access our own performance.
• Rectify the process.
• Judge interactions if any.
• Pin point factors causing deviations.

35
4. STRATIFICATION CHART:

This is a way to break down a problem to aid in focusing on the cause. Instead of looking at the
total number of defects, the chart breaks down the defects by similar contributors. It stratifies the
data according to like contributors. The contributors may be such things as shifts, plants,
machines or operators. It is bar chart. The stratification chart compares like contributors against
frequency of occurrence.

36
EXAMPLE:

Collect the data for the defect shift-wise. Let us consider that the defects found in shift no 1, 2 &
3 are 160, 170 & 165 nos respectively. Plot the readings as shown in fig. On comparison it is
found that defects are more or less same in each shift. So, shift difference can be ruled out as
cause.
Now collect the data for the same defects machine-wise. Let us consider that the defects found
in machines a, b, c, d, & e are 50, 60. 20, 300, & 90 nos respectively. Plot these readings as
shown in figure. On comparison it is found that machine ‘d’ produces far more defects than other
four machines. For the improvement team, this is the key finding in their work for improvement.

37
5. SCATTER DIAGRAM:

This diagram shows relationship between paired data such as that encountered in analysing a
process using the other QC tools. For example, the cause and effect diagram identifies individual
factors but does not provide a means to establish whether a measurable relationship exists
between them. It does not describe which variables relate to each other, which vary at the same
time, which is cause, and which is effect.

WHEN TO USE:

(1) When trying to identify a potential root causes of problem.

(2) After brainstorming the causes and effects using fishbone diagram, to determine whether
a particular cause & effect are related.
(3) Use scatter diagram to determine what happens to one variable when another variable
changes value.

PROCEDURE:

(1) Collect paired data for variables where a relationship is suspected.

(2) Plot all the paired variables on a graph, with one variable on horizontal axis and other on
vertical axis.
( 3 ) Look at the pattern of points, to see relationship. If the points clearly form a line, stop
here, otherwise switch over to step – 4.
( 4 ) Divide points on the graph into four quadrants. If there are ‘p’ points on the graph count
p/2 points from top to bottom and draw a line. Also count p/2 points from left to right and
draw a line. Label the four quadrants as I, II, III, & IV.
( 5 ) Count how many points are there in each quadrant.
( 6 ) Calculate –
A = no of points in QT. I + QT. III
B = no of points in QT. II + QT. IV
N=A+B
and find Q = the smaller of A & B.
( 7 ) Find out the limits for ‘N’ from the trend test table.
If ‘Q’ is less than the limit, two variables are related and
If ‘Q’ is greater than the limit, the pattern could have occurred from random chance, no
relationship exists.

TREND TEST TABLE:

N Limit N Limit N Limit N Limit

1-8 0 30 – 32 9 51 – 53 18 72 – 73 27
9 - 11 1 33 – 34 10 54 – 55 19 74 – 76 28
12 – 14 2 35 – 36 11 56 – 57 20 77 – 78 29
15 - 16 3 37 – 39 12 58 – 60 21 79 – 80 30
17 – 19 4 40 – 41 13 61 – 62 22 81 – 82 31
20 - 22 5 42 – 43 14 63 – 64 23 83 – 85 32
23 – 24 6 44 – 46 15 65 – 66 24 86 – 87 33
25 – 27 7 47 – 48 16 67 – 69 25 88 – 89 34
28 - 29 8 49 – 50 17 70 – 71 26 90 35

38
EXAMPLE:

The chemical industry suspects a relationship between product purity (% purity) and the amount
of iron (measured in part per million or ppm) so, decide to plot scatter diagram.

PROCEDURE:
( 1 ) Collect 24 Nos of paired data.

S.No. % purity Iron(PPM) S.No. % purity Iron (PPM) S.No. % purity Iron(PPM)
01 99.30 0.11 09 99.70 0.28 17 99.60 0.35
02 99.00 0.12 10 99.20 0.29 18 98.30 0.41
03 98.50 0.14 11 99.70 0.29 19 99.50 0.41
04 98.70 0.21 12 99.10 0.31 20 98.50 0.45
05 99.50 0.21 13 99.50 0.31 21 98.90 0.45
06 99.70 0.22 14 98.70 0.32 22 98.20 0.50
07 98.80 0.23 15 98.80 0.33 23 98.70 0.61
08 99.40 0.28 16 99.50 0.35 24 98.90 0.65

(2) Plot all the 24 paired data on graph, taking amount of iron on X – axis and %age of purity
on Y – axis.
(3) On seeing the pattern of points, it is observed that points are not forming clear line, point
are scattered.
(4) Divide points on graph into four quadrants, by counting 24/2 =12 points from top to
bottom and draw a horizontal line and again counting 12 points from left to right and
draw a vertical line & label the quadrants as I, II, III, & IV.
(5) Find out the nos. of points in each quadrant.
(6) Calculate :
A = no of points in I QR. + III QR. = 5 + 4 = 9.
B = no of points in II QR. + IV QR.= 7 + 8 = 15.
N = A + B = 9 + 15 = 24 and
Q = smaller of A & B = smaller of 9 & 15= 9.
for N = 24, the limit is ‘6’ ( from trend test table ).

39
CONCLUSION:

In this example Q = 9, which is greater than the limit 6. Therefore, the pattern could have
occurred from random chance and no relationship exists.

6. HISTOGRAM

A histogram is a basic graphing tool that displays the relative frequency or occurrence of
continuous data values showing which values occur most and least frequently. A histogram is
graphic summary of variation (dispersion) in a set of data. It is a vertical bar chart of a frequency
distribution. The histogram highlights the centre and the amount of variation in the sample of
data. A histogram illustrates the shape, centering, and spread of data distribution and indicate
whether there are any outliers.

The simplicity of construction and interpretation of histogram makes it an effective tool in

the elementary analysis of data.

WHEN TO USE :

• To communicate the distribution quickly & easily to others.

• To determine whether the output of a process is distributed approximately normal.
• To see whether a change has occurred from one time period to another.
• To analyse quickly whether a process can meet the customer’s requirements.

PROCEDURE FOR CONSTRUCTION:

01 Collect minimum 100 consecutive data from a process.

02 Calculate range of data by using formula R = max. – min.
03 Decide No. of bars ( B ), for 100 nos. of data, ‘B’ may be 10 to 12.
04 Calculate width (W) of the bar by using formula W = R / B.
05 Draw tally sheet and find out the frequency in each bar.
06 Draw X & Y axes on graph. Mark and label frequency on the X- axis for and width of bars
on X – axis.
07 Plot the Histogram.

EXAMPLE:

Object: To plot the histogram for the amplifier, whose specification is 10 + 2.25 decibels
(gain of amplifier ).

40
PROCEDURE:

Step 1: Collect the gain of 120 Nos of amplifiers. Data –

Sl.No 1 2 3 4 5 6 7 8 9 10
1 8.1 10.4 8.8 9.7 7.8 9.9 11.7 8.0 9.3 9.0
2 8.2 8.9 10.1 9.4 9,2 7.9 9.5 10.9 7.8 8.3
3 9.1 8.4 9.6 11.1 7,9 8.5 8.7 7.8 10.5 8.5
4 11.5 8.0 7.9 8.3 8.7 10.0 9.4 9.0 9,2 10.7
5 9.3 9.7 8.7 8.2 8.9 8.6 9.5 9.4 8.8 8.3
6 8.4 9.1 10.1 7.8 8.1 8.8 8.0 9.2 8.4 7.8
7 7.9 8.5 9.2 8.7 10.2 7.9 9.8 8.3 9.0 9.6
8 9.9 10.6 8.6 9.4 8.8 8.2 10.5 9.7 9.1 8.0
9 8.7 9.8 8.5 8.9 9.1 8.4 8.1 9.5 8.7 9.3
10 8.1 10.1 9.6 8.3 8.0 9.8 9.0 8.9 8.1 9.7
11 8.5 8.2 9.0 10.2 9.5 8.3 8.9 9.1 10.3 8.4
12 8.6 9.2 8.5 9.6 9.0 10.7 8.6 10.0 8.8 8.6

Step 2: Calculate range - Range = max. – min. or R = 11.7 – 7.8 = 3.9.

Step 3: Decide no of bars: let B = 9.
Step 4: Calculate no of bars: No. of bars = W = R / B = 3.9 / 9= 0.43
let us round it to 0.50.
Step 5: Draw tally sheet:

Sl. No. Width of bar Tally marks Frequency

01 07.75 – 08.24 IIII IIII IIII IIII IIII 24

02 08.25 – 08.74 IIII IIII IIII IIII IIII III 28
03 08.75 – 09.24 IIII IIII IIII IIII IIII I 26
04 09.25 – 09.74 IIII IIII IIII IIII 19
05 09.75 – 10.24 IIII IIII II 12
06 10.25 – 10.74 IIII II 07
07 10.75 – 11.24 II 02
08 11.25 – 11.74 II 02
09 11.75 – 12.24 Nil
Total = 120

Step 6 & 7: Draw x & y axes on graph and plot the histogram.

CONCLUSION:

It is concluded from the histogram, that all the amplifier gains are within the specified limit but the
readings are certainly not distributed around the nominal 10 decibels. Most of the readings are
lower than the nominal value of the gain.

41
 TYPES
OF

HISTOGRAM:

( 01) Normal :
The most common bell shaped curve is known as the normal distribution. In normal
distribution, points are as likely to occur on one side of the average as on the other side.

( 02 ) Skewed :
The skewed distribution is lopsided, because a physical limit prevents outcomes on one
side of the average.

( 03 ) Double peaked or biomodal :

The double peaked distribution looks like the back of the camel. The outcomes of two
processes with normal distribution are combined in one set of data.

( 04 ) Plateau:
The plateau might be called a multimodal distribution. Several processes with normal
distributions are combined.

( 05 ) Comb:
In the comb distribution, the bars are alternately tall and short. This distribution often
results from a combination of rounded off data and an incorrectly constructed histogram.

42
EXERCISE:

Draw the Pareto diagram for the customer’s complaints received in each of five categories –
documents, product quality, packing, delivery & others. The number of complaints received
against each five categories are 40, 35, 11, 09, & 05 respectively.
Also draw Pareto diagram for six various types of complaints received under documents
category. The details of Complaints are –

(1) Certificate of analysis ( C of A ) error = 16 nos.

(2) Certificate of analysis ( C of A ) missing = 11 nos.
(3) Invoice error = 05 nos.
(4) Packing list error = 04 nos.
(5) Wrong quantity = 03 nos.
(6) Others = 01 nos.

Total = 40 nos

43
CONTROL CHARTS

WHAT IS CONTROL CHARTS?

The control charts is a graphical representation used to analyze variations of a process by

comparing current data from a specified limits. One can make conclusion about whether the
process is stable or is being affected by some special cause of variations.

Quality of any manufactured product is determined by some characteristics that may of two
types-

VARIABLES:

When a record shows the actual measurement (measured on continuous scale) such as
dimension in mm, the quality characteristics is called variables.

ATTRIBUTES:

When a record shows only the no. of articles conforming or not conforming to the specified
requirement, the quality characteristic is called attributes.

Eg: on/off, present/absent, go/no go

Measured quality of any manufactured product is always subject to a certain amount of variation
that may be of two types-

• CHANCE CAUSES (COMMON CAUSES) :

Are those causes, which can not be eliminated. It will always be inherent in process.

• ASSIGNABLE CAUSES (SPECIAL CAUSES) :

Are those causes, which can be removed. Reasons for this variation may be discovered and
corrected

There are mainly two types of control charts:

• Control chart for variables (X bar & R chart)

• Control chart for attributes ( p, np, c, & u chart)

These charts provide information on three matters, which are basis for action.
These are-

• Basic variability of the quality characteristics.

• Consistency of performance
• Average level of the quality characteristics.

44
WHEN TO USE CONTROL CHARTS:

• When the process data to be analyzed are measured on a continuous scale. For example
temperature, weight, time, length, diameter etc.

• When the process data are not normally distributed.

• When you want to predict the expected range of outcomes from a process.

• When you want to determine whether a process is stable or not.

• When you want to analyze the patterns of a process variation for special causes
(non-routine events) or common causes (built in process).

• When you want to determine how to proceed with a quality improvement project.

• When you want to detect small process change.

PROCEDURE:

01 Choose the appropriate control chart for your data.

02 Determine the appropriate time period (frequency) for collecting the data.

03 Construct the chart, following the procedure of your control chart and analyze the
chart.

04 When you see an out of control signal on the chart, investigate the causes. Write on
control chart, what you find after investigation and how it can be corrected.

05 Continue to plot the data as they are generated.

06 When you start a new control chart, the process may be out of control, if so, the control
limits calculated earlier are conditional limits. Now you further collect atleast 20 nos. of
data, when the process is in control and re-calculate the limits

CONTROL CHART FOR VARIABLES

X-BAR & R CHART

The X-bar & R chart is a control charts for variables. It is a graphical representation of quality
characteristics over time against µ + 3 sigma as standard.

PROCEDURE:

01 Decide the quality characteristics ( X )

02 Decide the frequency and sub-group size ( n )

03 Collect data at least for 20 sub-groups ( N )

45
04 Calculate average (X-bar) & range ( R ) for each sub-group and record on chart.

05 Calculate the averages of average (X- double bar) & range (R-bar ) by using formula .
X - Double Bar = ∑X - Bar / N
 R- Bar = ∑R / N respectively

06 Find out the value for control limit factors ( like A2, D3, & D4 ) from the table.

n A2 D3 D4

2 1.880 — 3.267 A2 = —––––––––

3 1.023 — 2.574
4 0.729 — 2.282 D3 = —————
5 0.577 — 2.114
6 0.483 — 2.004 D4 = —————
7 0.419 0.8 1.924

07 Calculate control limits for X-bar & R Chart separately by using formula - (3-sigma
estimate for X-bar chart = A2 x R-bar)

UCL FOR X-BAR = X-DOUBLE BAR + A2 x R-BAR UCL FOR R =D4 x R-BAR
LCL FOR X-BAR = X-DOUBLE BAR – A2 x R-BAR LCL FOR R = D3 x R-BAR

08 On the average (X-bar) part of the chart, draw the axis and mark the numerical scale.
Plot the sub-group nos, on X-axis and sub-group averages on Y-axis. Draw the. Lines for the
average of the averages (X-double bar) and control limits for X-bar (UCL & LCL).

On the range ( R ) part of the chart, draw the axes and mark the numerical scale. Plot the sub-
group nos. On X-axis and sub-group range ( R ) on Y-axis. Draw the lines for average of ranges
(R-bar) and control limits for R (UCL&LCL)

09 Analyze the chart for out of control signals analysis

(I) First check the R-chart for out of control signal (the entire test like single point out side,
run, & trend).
(II) If the R – chart is in control, check the X-bar chart for out of control signals (the entire test
listed above).

10 0n analysis, if any signal out of control is observed, investigate the causes and write on
chart what you have found after investigation and how that can be corrected.

11 Continue to plot the chart as data are generated and check for new out of control signals
(if any).

12 When you start for a new control chart and out of control signal is observed, then control
limits calculated earlier is conditional limits. Collect another 20 sub-group (at least) when the
process is in control and re-calculate the control limits.

46
Different patterns of control charts and its possible causes

47
EXAMPLE:
OBJECT:

To plot the X-bar & R chart for the quality characteristics diaphragm thickness of fz-117
magazine. Specified dimension = 0.20 – 0.12 mm.

PROCEDURE:

Step – 1: Quality characteristics decided is thickness (X)

Step – 2: - Frequency =30 min. & sub-group size – n = 05

Step –3 & step - 4: - Collection of data for sub-group – N = 20 and calculation of X-bars & R’s

N X1 X2 X3 X4 X5 X-bar R

01 0.20 0.18 0.19 0.17 0.11 0.17 0.09

02 0.15 0.17 0.14 0.16 0.13 0.15 0.04
03 0.19 0.23 0.15 0.17 0.16 0.18 0.08
04 0.18 0.17 0.19 0.16 0.20 0.18 0.04
05 0.20 0.18 0.18 0.21 0.18 0.19 0.03
06 0.17 0.19 0.12 0.15 0.22 0.17 0.10
07 0.17 0.16 0.16 0.17 0.14 0.16 0.03
08 0.17 0.18 0.21 0.17 0.17 0.18 0.04
09 0.15 0.14 0.13 0.18 0.20 0.16 0.07
10 0.16 0.15 0.19 0.18 0.17 0.17 0.04
11 0.19 0.18 0.19 0.18 0.21 0.19 0.03
12 0.16 0.16 0.19 0.12 0.17 0.16 0.07
13 0.15 0.17 0.16 0.19 0.13 0.16 0.06
14 0.17 0.16 0.17 0.18 0.17 0.17 0.02
15 0.16 0.17 0.18 0.16 0.18 0.17 0.02
16 0.17 0.17 0.15 0.15 0.16 0.16 0.02
17 0.16 0.18 0.18 0.15 0.18 0.17 0.03
18 0.16 0.15 0.17 0.14 0.18 0.16 0.04
19 0.19 0.22 0.17 0.17 0.15 0.18 0.07
20 0.16 0.17 0.17 0.18 0.17 0.17 0.02

Sum of X-bars = 3.40 sum of R’s = 0.94

Step - 5: Calculation of X-double bar & R-bar.

X- double bar = sum of X-bars / N = 3.40 / 20 = 0.17
R – bar = sum of Rs / N = 0.94 / 20 = 0.047

Step – 6: Find out the values of control limit factors from the table for sub-group size
n = 05, A2 = 0.577 , D3 = 0.000 D4 = 2.115

Step – 7: Calculate the control limits for range (r)

UCL FOR R = D4 x R-BAR = 2.115 x O.047 = 0.099
LCL FOR R = D3 x R-BAR = 0 x 0.047 = 0.000

48
Step – 8: Homogenize the range of each sub-group with the UCL for ranges.
On comparison, it is found that sub-group no 6’s Range(R) = O.10 is not homogenized with UCL
for range = 0.099 that means it is crossing the UCL of range. So discard the sub-group no – 6.

Step – 9: Now calculate the sum of balance 19 sub-groups ranges and R-bar (new). Also
calculate the new control limits for range, (taking new R-bar.) Sum of ranges of balance 19 sub-
groups = 0.84 so, R-bar (new) = 0.84 / 19 = 0.044

NEW UCL FOR R = D4 x R-BAR (NEW) = 2.115 x 0.044 = 0.093

NEW LCL FOR R = D3 x R-BAR (NEW) = 2.115 x 0 = 0.000
Now on comparison it is found that all the ranges of sub-groups are homogenized with new UCL
of range.

Step-10: Calculate the control limits for X-bar (taking new X-double bar). sum of X-bar of
balance 19 sub-groups = 3.23 So, X-double bar (new) = 3.23 / 19 = 0.17

UCL for X-bar = X-double bar + A2 x R-bar = 0.17 + 0.577 x 0.044 = 0.17 + 0.025 = 0.195

LCL for X-bar = X-double bar – A2 x R-bar = 0.17 - 0.577 x 0.044 = 0.17 – 0.025 = 0.145

Step – 11: Plot the X-bar & R chart. draw the axes and mark the numerical scale. Plot the
sub-group no on X-axis and averages & ranges on y-axis respectively in X-bar & R charts. Also
draw the lines for average of averages & ranges and control limits on both the charts.

Step – 12: Analyze the chart for out of control signals (if any).

Analysis: - (i) first check the R-chart for out of control signal (the entire test like single point
out side, run, & trend)
(ii) if the chart is in control, check the X-bar chart for out of control signal (the
entire test listed above).

Step –13: When out of control signal is observed, investigate the causes. Write on chart
what you have found after investigation and how that can be corrected.

Step – 14: CONCLUSION: It is observed from the X-bar chart, that all the averages points
are above the specified average. So it is concluded that there is a shift in averages on higher
side. Operator can be asked to re-set the machine on lower side.

49
50
51
 Seven QC Description Method of use Remarks
Tools
Pareto A diagram on which undesirable events or costs There may be a large number of undesirable Plot the “other” category
diagrams associated with items such as quality (e.g. number phenomena or causes of trouble. The Pareto at the far right of the
of defects or non-conforming products), productivity, diagram makes it easy to see which of these have diagram and ensure that it
cost, safety and so on are stratified according to the most serious effect on quality, productivity, is not too large.
their causes or manifestations and plotted in order cost, safety, etc., together with their relative
of importance. proportions.
Cause-and- A diagram shaped like the bones of a fish for Useful for searching out the factors that affect the Gather the opinions of as
effect diagram systematically summarizing the relationships characteristics, sorting out the relationships many people as possible
between quality characteristics, defects, etc. and between these factors (causes) and the in order to flush out all the
their causes. characteristics (the results), and depicting these relevant factors.
systematically.
Graphs and Diagrams for plotting data and showing temporal Used for organizing data. Use line graphs for Use solid lines, dotted
charts changes, statistical breakdowns and relationships showing time trends, bar graphs for comparing lines, circles and crosses
between different quantities. quantities and pie charts for showing relative skillfully for clarity.
proportions.
Check sheets Forms specially prepared to enable data to be Used for tallying the occurrences of the defects or Clarify the objective and
collected simply by making check marks. causes being addressed and graphing or charting design a check sheet to
them directly. suit it.
Histograms Prepared by dividing the data range into sub-groups Prepare separate, stratified histograms for each of Use at least 30 values,
and counting the number of points in each the 4Ms and examine the relationships between preferably around 100.
subgroup. The number of points (the frequency) is the shapes of the distributions and the
then plotted as a height on the diagram. specifications.
Scatter Prepared by plotting paired sets of data such as Collect paired sets of data on causes and effects, Use at least 30 values, 50
diagrams hardness and tensile strength, temperature and and use scatter diagrams to check for correlation if possible.
yield, porosity and insulation resistance, etc. against between the sets of data.
each other on x and y axes.
Control charts Prepared by plotting time along the horizontal axis Use to check whether there are too many chronic Think about the best
and a characteristic value on the vertical axis. defects, too much variation, values lying outside method of stratification
Unlike line graphs, they also show the control limit the control limits, or undesirable trends or cycles. and pay close attention to
lines. Control charts show whether or not a process is in sub grouping.
control.

An overview of the seven QC Tools

52
 QC Tools and Their Uses

New-product &

Environmental
Administration
Market survey
Quality cost &

Improvement

Management

Management

Management

management
development

, Information

protection &
Technology
Topic
Tool

Delivery

Process

Service
Main use

control

safety
Sales
Cause-and-effect Picking up and arranging all possible
{ ~ { { ~ ~ ~ ~
diagrams causes without any omissions
Pareto diagrams Singling out the really serious problems
{ ~ { { ~ ~ ~ ~
from among all the lesser ones
Graphs and charts Making data visual { { { { ~ ~ ~ ~
Checksheets Simplifying data collection and ensuring
{ { ~ { ~ ~ ~ ~
that no items are omitted when inspecting
Control charts Checking whether or not a process is in
{ { ~ { {
control
Histograms Plotting the shape of a distribution and
{ ~ ~ ~ ~ ~ ~
comparing it with specifications
Scatter diagrams Finding correlation between paired sets of
{ ~ { { { { {
data

53
 4. PROCESS CAPABILITY STUDY

INTRODUCTION

Determining process capability is the action of studying the causes of variation, separating
them into common and special causes and eliminating them later.

After the capability is known the process variables (causes) must be identified and
reduced.

Process capability is defined as the range of quality variation or process spread within which
machine or process can be expected to vary. Process capability analysis entails comparing the
performance of a process against its specifications. A process is capable if virtually all of the
possible variable fall within the specification limits.

Mathematically, it is defined as the six standard deviation (6σ ) spread calculated from a set of
sample measurements.

Process spread is estimated by using formula: P.C. = 6 x R bar / d2

Where R bar is mean of the ranges and d2 is the statistical constant depending upon the sample
size as shown below:

n d2
2 1.128
3 1.693
4 2.059
5 2.326

It is the measurement of variability and not of averages or means.

It refers to the uniformity of out put quality from a stable process (statistically controlled process).

Lower the variability observed in a process, greater is the uniformity of out put quality. Again,
greater the uniformity of out put quality, lower is the cost of the producing quality.

MEASURE OF PROCESS CAPABILITY :

In a stable process, measured value of most of the quality characteristics follow a definite
symmetrical pattern of variation which is theoretically known as normal distribution. It is
customary to take six standard deviation spread in this distribution as a measure of process
capability. The upper & lower natural tolerance control limits (UCL & LCL) of the process will be
+3σ & - 3σ respectively

The comparison of natural tolerance limits (UCL & LCL) with the specification limits (USL & LSL)
and natural tolerance range (UCL & LCL) with the specification range (USL & LSL) may lead to
any of the following possible course of actions –

54
1 No action: - If the natural tolerance limits fall within the specification limits, usually no
action will be taken.
2 Action to adjust centering: - When natural tolerance range is about the same as the
specification range, a relatively simple adjustment to the centering of the process may be
necessary to bring all products within the specification range.

3 Action to reduce variability: - When natural tolerance range is higher than the
specification range, action may be involving of bringing the products under control by change of
methods, tooling, materials & equipments.

4 Action to change specification: - In some cases, specification tolerance may be set

tighter than necessary. In other words, slight design change may be less costly or more feasible
than changes in machine or tooling.

PROCESS CAPABILITY VS SPECIFICATION TOLERANCE:

When viewed against the specification tolerance of a product quality characteristics, its process
capability may be inferior to, superior to, or just equal to the specification tolerance.

(1) – Inferior (2) – Superior (3) - Equal

(PC > Spd. Tol.) (PC < Spd. Tol.) (PC = Spd. Tol.)

Figure: - Relationship between PC & Spd. Tol.

Process control actions will squarely depend on the nature of the relationship between the p.c.
And specification tolerance for any quality characteristics of interest. For example

(1) If the P.C. Is inferior to spd. Tol., all efforts should be directed to reduce the process
variability such that p.c. Is made compatible with the specification tolerance.

(2) If the P.C. Is superior to spd. Tol., process may be set at an economical level either closer
to USL or closer to LSL.

(3) If the P.C. Is just equal to the spd. Tol., greater attention is needed for centering the
process either at the specification mean or at the most economical level taking account of the
manufacturing system in totality.

HOW TO USE : -

The calculation of process capability depends on whether the process is measured in terms of
variables data or attributes data.
For variables data, capability is expressed in terms of ratio called process capability ratio Cp

55
PROCESS CAPABILITY RATIO ( CP) :

It may be defined as the ratio of specification tolerance to process spread.

upper limit - lower limit

Cp = -------------------------------
6 sigma

Cp = specification tolerance / process spread. = USL – LSL / 6 σ

For one side specification, Cp is given by –
Cpu = USL - µ / 3 σ (for upper specification only)
Cpl = LSL- µ / 3 σ (for lower specification only)
This is a measure of the ability of the process to manufacture the product as per the specification.

The terminology used is that, if the ratio is 1.0 it has a 3 sigma capacity. If the ratio is 2.0
it has a 6 sigma capacity.

Another ratio, called process capability index (cpk), takes into account the lack of centering of the
process.

PROCESS CAPABILITY INDEX (CPK)

Process capability (Cp) is calculated assuming the process is centered between the upper
and lower tolerance limits.

Capability Index (Cpk) takes into account the lack of the centering of the process.
This is more useful measurement since process rarely remains fixed at the centre:

Cpk = Cp( 1 – k )

Where k = Tolerance Centre – process average / 1/2 (tolerance width)

It can also be calculated by calculating Cpu & Cpl. The smallest value of these will be the value of
Cpk. It should be greater than one.
For attributes data, the capability of the process is often called the first run capability (frc) and is
calculated as –

FRC = ( 1 – p bar ) x 100

where p bar = % of defective items.

Process capability evaluation:

Control chart method may be used to evaluate the process capability of a process. These are
very effective in this regard and hence regarded as the primary technique of evaluating the
process capability.

56
PROCESS CAPABILITY CALCULATION STEPS:

01 Collect 5 consecutive items from a running process.

02 Plot the readings & find out range ( r ) by using formula

R = max. Reading – min. Reading.

03 Collect 20 to 25 such samples plot them and find out the Ranges as per step no –2.

04 Calculate the averages of these ranges ( R bar ) by using the formula

R bar = sum of ranges / no of samples.

05 Calculate the control limits for range by using formula-

UCL for range = D4 x R bar & LCL for range = D3 x R bar.

06 Homogenize ranges with UCL for ‘R’

07 If any point fall out side the UCL, discard that & re-calculate the new R bar & UCL for
range.
08 Again homogenize the rest ranges with UCL for ‘r’ and ensure that all the ranges must fall
within the new UCL for ‘r’.

09 Calculate standard deviation (sigma) by using formula –

Standard deviation (sigma) = R bar / d2 , where d2 is constant.

10 Calculate process capability by using formula –

P.C. . = 6 x σ Also called process spread.

11 Calculate process control limits (taking value of x double bar

From X-bar & R-chart) by using formula –
UCL for process = x-double bar + 3-sigma.
LCL for process = x-double bar - 3-sigma.

12 Calculate process capability (cp) by using formula –

Cp = USL – LSL / 6 x σ

(a) If Cp is greater than or equal to one, then the process is capable of meeting
specifications. Work to centre the process within the specification.

(b) If Cp is less than one, then the process is not compatible, variation is there, work
to reduce the variation in the process.

13 Calculate CPK: for this first calculate Cpu & Cpl. The smaller of the two will be Cpk.
Larger Cpk value are better. If Cpk < 1, work to reduce the variation or to centre the
process Within specification limits.
Cpu = USL – X double  bar / 3 x σ & Cpl = X double bar – LSL / 3 x σ

57
58
EXAMPLE :

OBJECT:

To study the process capability for the quality Characteristics thickness of fz. 117 Magazine.

Step No. 01, 02 & 03 :

N X1 X2 X3 X4 X5 X-bar R

01 O.20 0.18 0.19 0.17 0.11 0.17 0.09

02 0.15 0.17 0.14 0.16 0.13 0.15 0.04
03 0.19 0.23 0.15 0.17 0.16 0.18 0.08
04 0.18 0.17 0.19 0.16 0.20 0.18 0.04
05 0.20 0.18 0.18 0.21 0.18 0.19 0.03
06 0.17 0.19 0.12 0.15 0.22 0.17 0.10
07 0.17 0.16 0.16 0.17 0.14 0.16 0.03
08 0.17 0.18 0.21 0.17 0.17 0.18 0.04
09 0.15 0.14 0.13 0.18 0.20 0.16 0.07
10 0.16 0.15 0.19 0.18 0.17 0.17 0.04
11 0.19 0.18 0.19 0.18 0.21 0.19 0.03
12 0.16 0.16 0.19 0.12 0.17 0.16 0.07
13 0.15 0.17 0.16 0.19 0.13 0.16 0.06
14 0.17 0.16 0.17 0.18 0.17 0.17 0.02
15 0.16 0.17 0.18 0.16 0.18 0.17 0.02
16 0.17 0.17 0.15 0.15 0.16 0.16 0.02
17 0.16 0.18 0.18 0.15 0.18 0.17 0.03
18 0.16 0.15 0.17 0.14 0.18 0.16 0.04
19 0.19 0.22 0.17 0.17 0.15 0.18 0.07
20 0.16 0.17 0.17 0.18 0.17 0.17 0.02

Sum of x bar’s = 3.40 sum of R’s = 0.94

Step no. 4 Calculate the average of ranges-

R bar = sum of R’s / No. of samples = 0.94 / 20 = 0.047

Step no. 5 Calculate the control limits for range-

UCL for ‘R’ = D4 x R bar = 2.115 x 0.047 = 0.099
LCL for ‘R’ = D3 x R bar = 0.000 x 0.047 = 0.000

Step no. 6 & 7 Homogenise all the ranges with UCL for ‘R’. It is observed that the sub-group no.
6 ( R = 0.10 ) is falling out side the UCL = 0.099. So discard sub-group No. 6. After
discarding the sum of balance ranges = 0.94 – 0.10 = 0.84.
So, new R bar = 0.84 / 20 = 0.042 & new UCL for ‘R’ = 2.115 x 0.042 = 0.093.

Step no. 8 Again homogenise the ranges of all remaining Sub-group with new UCL for ‘R’
and observed that all the ranges are within the new UCL for ‘R’
( = 0.093 ) So data’s are homogenised.

Step no. 9 Calculate the standard deviation (sigma). We know from the table that the value of
d2 for sample size 5 is 2.236.
So, sigma = sum of ranges / d2 = 0.042 / 2.236 = 0.018.

59
Step no. 10 Calculate the process capability (C.p.) PC = 6 x sigma = 6 x 0.018 = 0.108 mm.

Step no. 11 Calculate UCL and LCL for average. Taking X double bar = 0.17 from the X bar
chart

UCL for X bar = X double bar + 3 sigma = 0.17 + 3 x 0.018 = 0.22.

LCL for X bar = X double bar + 3 sigma = 0.17 + 3 x 0.018 = 0.12.

Step no. 12 Calculate process capability ratio ( Cp ).

Cp = USL – LSL / 6 x sigma = 0.20–0.08 / 6 x 0.018=0.12/0.108=1.11

Step no. 13 Calculate capability index ( Cpk ). For this first Calculate Cpu & Cpl.

Cpu = USL – X double bar / 3 x sigma = 0.20 - 0.17 / 3 x 0.018 = 0.030 / 0.054 = 0.55.
Cpl = X double bar – LSL / 3 x sigma = 0.17 – 0.08 / 3 x 0.018 = 0.09 / 0.054 = 1.66.
So, Cpk = 0.55 (smaller of the Cpu & Cpl value)

CONCLUSION:

Since the

(1) PC = 0.108 mm is less than the specified tolerance=0.120 mm So, it is concluded

that the process is compatible with Specification tolerance. But, since the

(2) Process capability ratio (Cp) is greater than one and

(3) Process capability index (Cpk) is less than one i.e. compatible but not centered. So, it
is also concluded that operator may be asked to centre the process closer to specification
mean from economical point of view and further reducing the rejections.

60
 5. ISO 9000

ISO 9000-2000 STANDARDS:

WHAT IS ISO 9000?

• ISO 9000 is the international standard for quality management systems.

• ISO 9000 sets out how a company can establish an effective quality system to meet their
customers need.
• ISO 9000 is a generic name given to a family of standards developed to provide a
framework around which a quality management system can effectively be implemented.

The ISO 9000 family of standards was revised in December 2000

ISO 9000 STANDARD ENSURES:

• Increased customer satisfaction.

• Transparency
• Corrective Actions
• Company image
• Objectivity & Formality
• Scientific Discipline

The latest ISO 9000-2000 family consists of four primary standards supported by a considerably
reduced number of other documents (guidance standards, brochures, technical reports &
technical specifications).

The four primary standards of 2000 version are –

ISO 9000 : Quality Management System - Fundamentals and Vocabulary.

(This standard describes the fundamentals of quality management
systems and specifies the terminology for QMS).

ISO 9001 : Quality Management System – Requirements.

(This standard specifies requirements for a quality management system where an
organisation needs to demonstrate its ability to provide product that meet customer and
applicable regulatory requirement and aims to enhance customer satisfaction).

ISO 9004 : Quality Management System-Guidance for performance

Improvements.
(This standard provides guidelines that consider both the effectiveness and
efficiency of the quality management system. The aim of this standard is improvement of the
performance of the organisation and satisfaction of customer and other interested parties).

ISO 19011: Guidelines on Quality & Environmental Management System

Auditing.
(This standard provides guidance on auditing quality and environmental management system).

Together they form a coherent set of quality management system standards facilitating mutual
understanding in national and international trades.

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In the current revisions 2000, the earlier standards ISO 9001, ISO 9002 and ISO 9003 have been
replaced by a single standard ISO 9000-2000, applicable to all organization, products and
services. This may be used for the certification of Quality Management System and may also be
the basis for contractual agreements. ISO 9004 is no contractual and is designed to go beyond
quality management system to a holistic approach to quality management in pursuit of
operational improvement and benefits to all interested parties.

The revised ISO 9001 & ISO 9004 are being designed to constitute a “consistent pair” of
standards. Their structure and sequence are identical in order to facilitate an easy and useful
transition between them and also to facilitate a more user-friendly introduction of QMS.

HIGHLIGHTS OF ISO 9001:2000

• A single requirements standard ISO 9001:2000

• Process oriented structure – PDCA
• Increase emphasis on role of top management
• Consideration of regulatory requirements
• Establishment of measurable objective at relevant functions & levels
• Monitoring of INFO on customer satisfaction/dissatisfaction as a measure of system
performance
• Increase attention to resource availability
• Determination of training effectiveness
• Analysis of collected data on the performance of QMS
• Increased emphasis on continual improvement
• Emphasis on the implementation of eight quality management principle.

REVISED QUALITY MANAGEMENT STANDARDS ISO 9001 AND ISO 9004

MAIN FEATURES:

Major changes in the revised ISO 9000 standards are –

1) Increased focus on top management commitment,

2) Increased focus on customer satisfaction,

3) Emphasis on processes within the organisation, and

4) Introduction of continual improvement concepts.

QUALITY MANAGEMENT PRINCIPLES:

In order to lead and operate an organisation successfully, it is necessary to direct and

control in a systematic and transparent manner. Success can result from implementing and
maintaining a management system that is designed to continually improve performance while
addressing the needs of all interested parties.

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 The revisions of ISO 9001 & ISO 9004 are based on eight quality management principles,
which have been identified as a framework towards improved performance of an organisation.
They are aimed at helping organization to achieve sustained success.

These eight principles are:

1) Customer Focus

Organizations depend on their customers and therefore should understand current and future
customer needs, should meet customer requirements and strive to exceed customer
expectations.

2) Leadership

Leaders establish unity of purpose and direction of the organisation. They should create and
maintain the internal environment in which people can become fully involved in achieving the
organisation’s objectives.

3) Involvement of people

People of all levels are the essence of an organisation and their full involvement enables their
abilities to be used for the organisation’s benefit.

4) Process approach

A desired result is achieved more efficiently when activities and related resources are managed
as a process.

5) System approach to management

Identifying, understanding and managing interrelated processes as a system contributes to the

organisation’s effectiveness and efficiency in achieving its objectives.

6) Continual improvement

Continual improvement of the organisation’s overall performance should be a permanent

objective of the organisation.

7) Factual approach to decision making

Effective decisions are based on the analysis of data and information.

8) Mutually beneficial supplier relationship

An organisation and its suppliers are interdependent and mutually beneficial relationship
enhances the ability of both to create value.

These eight quality management principles form the basis for the quality management system
standards within ISO 9000 family.

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CHANGES INTRODUCED

A) Structure

The significant changes have been included to the structure of ISO 9001 & ISO 9004-2000,
which, while retaining the essence of the original requirements, have repositioned the 20
elements of the earlier ISO 9001:94 and the guidelines of ISO 9004-1:94 into four main sections
as:

1) Management responsibility,
2) Resource management,
3) Product realization, and
4) Measurement, analysis and improvement.

B) Sequence

There is a more logical sequence of requirements and guidelines due to the process orientation
of the new standards.

C) Top Management

More emphasis has been placed on the role of top management, which includes its commitment
to the development and improvement of QMS, with a customer focus, consideration of legal and
regulatory requirements, and establishment of measurable objectives at relevant functions and
levels.

D) Continual Improvement

An enhanced requirement for “continual improvement” has been introduced, as anticipated, into
ISO 9001, defining a complete cycle to improve the effectiveness of the QMS.

E) Permissible Exclusions

The concept of “permissible exclusions” to the requirements of ISO 9001-2000 has been
introduced as a way to cope with the wide spectrum of organisations and activities that will be
using the new standard.

F) Customer Satisfaction

Another new item that has been introduced into ISO 9000:2000 is the requirement for the
organisation to monitor information on customer satisfaction and/or dissatisfaction as a measure
of system performance.
G) Terminology

It should be noted that changes have been also occurred in terminology. The most important
changes concern the use of the term “organisation” instead of “supplier” and “supplier” instead of
“subcontractor”.

H) Documentation

The number of requirements for documented procedures has been reduced in ISO 9001:2000,
and the emphasis placed on the organisation demonstrating effective operation.

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I) Other changes

Other changes of less strategic nature are also being studied, with the intention to simply or
clarify requirements of existing standards, and to make them more “user-friendly”, such as-

1) - Increased compatibility with Environmental Management System,

2) - Specific reference to Quality Management Principles,
3) - Consideration of the benefits and needs of all interested parties,
and
4) - Addition of the concept of organizational self-assessment as a
driver for improvement (ISO 9004).

What are the benefits of the revised standards?

There are number of major benefits with the revised quality management system standards. The
benefits are:

1. Applicability to all product categories, in all sectors and to all sizes of organisations

2. Simple to use, clear in language, and easily understandable

3. Significant reduction in the amount of required documentation

4. Connection of quality management system to organizational processes

5. Provision of a natural move towards improved organizational performance

6. Greater orientation toward continual improvement and customer satisfaction

7. Compatibility with other management system such as ISO 14000

8. Provision of a consistent basis to address the needs and interests of organizations in

specific sectors (e.g. medical devices, telecommunications, automotive, etc)

9. The concept of consistent pair – ISO 9001 covering the requirements and ISO 9004 for
going beyond the requirements in order to further improve the performance of the
organization

10. Consideration of the needs and benefits to all interested parties.

What is meant by continual improvement?

Continual improvement is the process focused on continually increasing the effectiveness and/or
efficiency of the organization to fulfill its policies and objectives. Continual improvement (where
“continual” highlights that an improvement process requires progressive consolidation steps)
responds to the growing needs and expectations of the customer and ensures a dynamic
evolution of the quality management system. Actions for improvement include the following:

a) Analyzing and evaluating the existing situation to identify areas for

improvement,
b) Establishing the objectives for improvement,
c) Searching for possible solutions to achieve the objectives,
d) Evaluating these solutions and making a selection,

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e) Implemented the selected solution,
f) Measuring, verifying, analyzing and evaluating results of the implementation to determine
that the objectives have been met, and
g) Formalizing changes.

Results are reviewed, to determine further opportunities for improvement. Quality

management system approach

An approach to developing and implementing a quality management system

consists of several steps including the following:

a) Determining the needs and expectations of customers and other

interested parties,
b) Establishing the quality policy and quality objectives of the organization,
c) Determining the processes & responsibilities necessary to attain quality
objectives,
d) Determining and providing the resources necessary to attain the quality objectives,
e) Establishing methods to measure the effectiveness and efficiency of each process,
f) Applying these measures to determine effectiveness & efficiency of each process,
g) Determining means of preventing nonconformities and eliminating their causes, and
h) Establishing and applying a process for continual improvement of the QMS.

An organization that adopts the above approaches, creates confidence in the capability of
its processes and the quality of its products, and provides a basis for continual improvement.
This can lead to increased satisfaction of customers and other interested parties and to the
success of the organization.

Role of Top Management within the Quality Management System

Through leadership and actions, top management can create an environment where people are
fully involved and in which a QMS can operate effectively. Top management as the basis of its
role can use the quality management principles, which is as follows:

a) To establish & maintain the quality policy & quality objectives of the organization,
b) To promote the quality policy and quality objectives throughout the organization,
c) To ensure focus customer requirements throughout the organization,
d) To ensure the availability of necessary resources,
e) To ensure that appropriate processes are implemented to enable requirements of
customers
to be fulfilled and quality objectives to be achieved,
f) To ensure that an effective and efficient quality management system is established,
implemented and maintained to achieve these quality objectives,
g) To review the quality management system periodically,
h) To decide on actions regarding the quality policy and quality objectives, and
i) To decide on actions for improvement of quality management system.

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QUALITY POLICY AND QUALITY OBJECTIVES:

Quality Policy:

Overall intentions and directions of an organization related to Quality as formally

expressed by Top Management. Generally the quality policy is consistent with the overall policy
of the organization and provides a framework for setting and reviewing of quality objectives.

Quality Objectives:

Something sought, or aimed for, related to quality. Quality objectives need to be consistent with
the organization’s quality policy and the commitment to continual improvement, and their
achievement need to be measurable. Quality objectives are generally specified for relevant
functions and levels in the organization.

Quality policy and quality objectives are established to provide a focus to direct the organization,
and assist the organization to apply its resources to achieve the results. The achievement of
quality objectives can have a positive impact on product quality, operational effectiveness and
financial performance and thus on the satisfaction and confidence of interested parties.

The Process Approach:

Any activity, or set of activities, that uses resources to transform inputs to outputs can be
considered as process.

The intent of this International Standard is to encourage the adoption of the process approach
when developing, implementing and improving the effectiveness and efficiency of a quality
management system to enhance customer satisfaction by meeting customer requirements.

For an organization to function effectively, it has to identify and manage numerous linked
activities or inter-related processes. Often the output from one process directly forms the input to
the next.

The application of a system of processes within an organization, together with the identification
and interactions and managing of these processes can be referred as the “process approach”.

An advantage of process approach is ongoing control that it provides over the linkage between
the individual processes within the system of processes, as well as their combination and
interaction. When used within a QMS, this approach emphasis the importance of

a) Understanding and fulfilling the requirements,

b) The needs to consider processes in terms of added value,
c) Obtaining results of process performance and effectiveness, and
d) Continual improvement of processes based on objective measurement.

Figure 1 is a conceptual illustration of one model of the process approach presented in clauses 5
to 8. The model recognizes that customers play a significant role in defining requirements as
inputs. Monitoring of customer satisfaction is necessary to evaluate and validate whether
customer requirements have been met. This model does not reflect processes at a detailed level,
but covers all the requirements of this International Standard.

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 FIGURE - 1

DOCUMENTATION:

Management should define the documentation, including the relevant records needed to
establish, implement and maintain the QMS and to support an effective and efficient operation of
the organization’s processes.

The following types of documents are used in quality management systems:

a) Documents that provide consistent information, both internally and externally, about the
organization’s QMS; such documents are referred to as quality manuals,

b) Documents that describe how the QMS is applied to a specific product, project or contract;
such documents are referred to as quality plan,

c) Documents stating requirements; such documents are referred to as specifications,

d) Documents stating recommendations or suggestions; such documents are referred to as

guidelines,

e) Documents that provides information about how to perform activities and processes
consistently; such documents can include documented procedures, work instructions and
drawings,

f) Documents that provides objective evidence of activities performed or results achieved;

such documents are referred to as records.

The nature and extent of the documentation should satisfy the contractual, statutory and
regulatory requirements, and the needs and expectations of customers and other interested
parties and should be appropriate to the organisation. Documentation may be in the form or
media suitable for the needs of the organisation.

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 DOCUMENTATION REQUIREMENTS FOR ISO 9001: 2000

Following are the documentation requirements for ISO 9001: 2000:

4.1 - General requirements

4.2.1 (a) - Documented statement of Quality Policy & Quality Objectives
5.3 - Quality Policy
5.4.1 - Quality Objectives
4.2.1 (b) - Documented Quality Manual
4.2.2 - Quality Manual
4.2.1 (c) - Documented procedures required by this International Standard

1) - 4.2.3 - Control of documents

2) - 4.2.4 - Control of quality records
3) - 8.2.2 - Internal audit
4) - 8.3 - Control of Nonconforming product
5) - 8.5.2 - Corrective action
6) - 8.5.3 - Preventive action

NOTE: Where the term “documented procedure” appears in this International Standard, this
means that the procedure is established, documented, implemented and maintained.

4.2.1 (d) - Documents needed by the organisation to ensure the effective planning, operation
and control of its processes.
5.2 - Customer focus
5.4.2 - Quality management system planning
5.5.1 - Responsibility and authority
5.5.2 - Management representative
5.5.3 - Internal Communication
6.2.2 - Competence, awareness and training
7.1 - Planning of product realization
7.2.2 - Determination of requirements related to product
7.3.1 - Design and development planning
7.3.2 - Design and development inputs
7.3.3 - Design and development outputs
7.3.7 - Control of Design and development changes
7.4.1 - Purchasing process
7.4.2 - Purchasing information
7.4.3 - Verification of purchased product
7.5.1(b) - Work instructions
7.5.2 - Validation of processes for production and service provision
7.6 - Control of monitoring and measuring devices
8.1 - General
8.2.1 - Customer satisfaction
8.2.3 - Monitoring and measurement of processes
8.2.4 - Monitoring and measurement of product

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RECORDS TO BE MAINTAINED AS PER ISO 9001 : 2000

Following are the Records required by the International Standard ISO 9001 : 2000:

4.2.3 - Record of control of Documents

4.2.4 - Record of control of Records
5.6.1 - Record of Management review
6.2.2(e) - Record of education, training, skills and experience
7.1 - Record of realization processes and resulting product fulfill
requirements
7.2.2 - Record of the results of the review and actions arising from the
review
7.3.2 - Record of inputs relating to product requirements
7.3.4 - Record of results of the design and development reviews
7.3.5 - Record of results of the design and development verification
7.3.6 - Record of results of the design and development validation
7.3.7 - Record of results of the design and development changes
7.4.1 - Record of results of evaluation of suppliers
7.5.2 - Record of special processes (procedure qualification record – PQR)
7.5.3 - Record of identification and traceability
7.5.4 - Record of the customer property
7.6(a) - Record of basis of calibration where no international standard
exists
7.6(c) - Record of calibration records
7.6(d) - Record of validity of previous instruments when an instrument is out
of calibration
8.2.2 - Record of internal audits and follow up activities
8.2.4 - Record of verification of products
8.3 - Record of nature of nonconformities and actions taken
8.5.2 - Record of corrective actions
8.5.3 - Record of preventive actions.

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ISO 9000 : 2000 — QUALITY MANAGEMENT SYSTEM – REQUIREMENTS.

1 - Scope:

1.1 - General
1.2 - Application

2- Normative Reference

3- Terms and Definitions

4- Quality Management System:

4.1 - General Requirements
4.2 - Documentation Requirements:
4.2.1 - General
4.2.2 - Quality Manual
4.2.3 - Control of Documents
4.2.4 - Control of Quality Records

5- Management Responsibility:
5.1 - Management Commitment
5.2 - Customer Satisfaction
5.3 - Quality Policy
5.4 - Planning:
5.4.1 - Quality Objectives
5.4.2 - Quality Management System Planning
5.5 - Responsibility, Authority and Communication:
5.5.1 - Responsibility and Authority
5.5.2 - Management Representative
5.5.3 - Internal Communication
5.6 - Management Review:
5.6.1 - General
5.6.2 - Review Input
5.6.3 - Review output

6- Resource Management:
6.1 - Provision of Resources
6.2 - Human Resource:
6.2.1 - General
6.2.1 - Competence, Awareness & Training.
6.3 - Infrastructure
6.4 - Work Environment

7- Product Realization:
7.1 - Planning of Product Realization
7.2 - Customer-related Processes:
7.2.1- Determination of requirements related to product
7.2.2- Review of requirements related to product
7.2.3- Customer communication

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 7.3 - Design and development:
7.3.1- Design and development planning
7.3.2- Design and development inputs
7.3.3- Design and development outputs
7.3.4- Design and development review
7.3.5- Design and development verification
7.3.6- Design and development validation
7.3.7- Control of Design and development changes
7.4 - Purchasing:
7.4.1- Purchasing process
7.4.2- Purchasing information
7.4.3- Verification of purchased product
7.5 - Production and service provision:
7.5.1- Control of production and service provision
7.5.2- Validation of processes for production and
service provision
7.5.3- Identification and Traceability
7.5.4- Customer property
7.5.5- Preservation of product
7.6 - Control of monitoring and measuring devices

8- Measurement, Analysis and Improvement

8.1 - General
8.2 - Monitoring and measurement:
8.2.1- Customer satisfaction
8.2.2- Internal audit
8.2.3- Monitoring and measurement of processes
8.2.4- Monitoring and measurement of product
8.3 - Control of nonconforming product
8.4 - Analysis of data
8.5 - Improvement
8.5.1- Continual improvement
8.5.2- Corrective action
8.5.3- Preventive action

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 6. QUALITY COST

INTRODUCTION:

Quality cost is just one of a number of quality management tools and techniques. An
organisation can use it in the introduction & development of Total Quality Control programme to
get quality at economical cost.

Like any other tool and technique, management has got to decide if it needs to use quality
costing and if so, when and in what form. Management also needs to consider what commitment,
resources and expertise are required to make the best use of quality costing.

In today’s markets, customer requirements are becoming increasingly more rigorous and
their expectations of product/service in terms of its conformance, reliability, durability,
interchangeability, performance, features, appearance, serviceability, environment and user
friendliness and safety are also increasing. At the same time, the existing competition will be
improving and new and lower cost competitors way among in the market place.

Quality related costs are not, just the cost of quality assurance, inspection, monitoring,
testing and scrap materials, components and products. Quality related costs arose from a range
of activities and involves a number of departments in an organisation.

e.g.
• Sales & marketing
• Design, research & development
• Purchasing, storage, handling
• Production or operations planning & control
• Manufacturing/ operations
• Delivery, construction, installation
• Service

Suppliers, subcontractors, stockiest, agents, dealers and customers can all influence the
incidence and level of quality related costs.

DEFINITION OF QUALITY COST

A quality cost is defined as

“The expenditure incurred by the producer, by the user and by the community, associated with
product or service quality.”

And a quality related cost as:

“The expenditure incurred in defect prevention and appraisal activities plus the losses due to
internal & external failure”.

Ideas of what constitute the quality cost is changing rapidly in recent years. Whereas in
early 1980s the cost of quality were perceived as the cost of running the quality assurance
department, plus scrap, rework, testing and warranty costs.

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HISTORY OF QUALITY COST

The term ‘quality cost’ was certainly used in Western Europe in 1950 and in early 1960 originated
with categorization of costs into prevention – appraisal – failure.

These costs build up roughly as follows:

Failure 70 %
Appraisal 25 %
Prevention 5 %

And total may amounts to be between 4 to 14 % of the turnover of the company.

A draft international standard (ISO 10014 Guide to the Economics of Total Quality
Management) is being prepared.

Quality costing has been used primarily by manufacturing industry, but today there is growing
interact from commerce, the public sector and service organisations. There is now clear
evidence of quality costing being used in a variety of non-manufacturing situations including
financial institutions, transport & distribution, health care and the travel & holiday industry.

WHY QUALITY COST

Quality costs are important

1. Because they are large. The finding of NEDC (National Economics Development council)
task force in 1985, claims that 10 to 20 % of an organizations total sales value is
accounted by quality related costs.

2. 95 percent of quality cost is usually expended on appraisal and failure. These expenditure
add little to the value of the product or service and the failure cost may be regarded as
avoidable.

3. Unnecessary and avoidable cost makes goods and services more expensive. This in turn
affects competitiveness and utility, wages, salaries & standard of living

4. The cost and economics of many quality related activities, including prevention &
appraisal activities are not known.

The measurement of costs allows quality related activities to be expressed in the

language of management. Thus quality to be treated as a business parameter along with
marketing, research & development, production/operations.

Quality cost measurement focuses attention on areas of high expenditure and wastage
and identifies potential problem areas for cost reduction and improvement opportunities. It
allows measurement of performance & provides a basis of internal comparison between
products, services, process and departments.
Measurement is the first step towards control & improvements.

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QUALITY COST CATEGORIES

The prevention – appraisal – failure (PAF) categorization model by ASQC (American Society
of Quality Control) are defined as follows

ELEMENTS OF PREVENTION – APPRAISAL-FAILURE METHODS

The first step is to identify the elements of costs the second is to measure and quantify the
elements and final step is to cost the elements.

1. PREVENTION COSTS : These includes

These costs are incurred to reduce failure and appraisal costs to a minimum. It includes
the following:

a. Quality planning
The activity of planning quality systems and translating product design and
customer quality requirements into measures that will ensure the attainment of the requisite
quality product of includes the overall quality plan, the inspection plan, the reliability plan and
other specialized plans as appropriate. It also includes the preparation and vetting of
manuals and procedures needed to communicate these plans to all concerned.

b. Design & development of quality measurement & test equipments

These include costs of designing, developing and documenting any necessary
inspection, testing or proving equipment.

c. Quality, review & verification of design

Quality organization monitoring activity during the product’s design & development
phase. Involvement with the design review activities and in verification activity during the
various phases of the product development test programme.

d. Calibration & maintenance of quality measurement & test equipments

The cost of calibration and maintenance of templates, jigs, fixtures and similar
items should be included.

e. Calibration & maintenance of production equipment used to evaluate quality

The costs of calibration and maintenance of templates, jigs, fixtures and similar
measurement & evaluating devices used to manufacture the product.

f. Supplier assurance
The initial assessment, subsequent audit and surveillance of suppliers to
ensure they are able to meet and maintain the requisite product quality. This also includes
reviews & control of technical data in relation to purchase orders.

g. Quality training
This includes attending, developing, implementing, operating and maintaining
formal quality training programmes.

h. Quality auditing
The activity involving the appraisal of the entire system of quality control of specific
elements of the system.

75
i. Acquisition analysis and reporting of quality data
The analysis and processing of data for the purpose of preventing future failure.

j. Quality improvement programmes

This includes the activity of structuring and carrying out programmes aimed at new
levels of performance. e.g. Defect prevention programme, quality motivation programmes.

2. APPRAISAL COST :

These costs are incurred in initially ascertaining the conformance of the product to quality
requirements. This includes the following:

a. Preproduction verification
Cost associated with testing and measurement of preproduction for the purpose of
verifying the conformance of the design to the quality requirements.

b. Receiving inspection
The inspection & testing of incoming parts, components and materials. Also
included inspection at the suppliers premises by the purchasers.

c. laboratory acceptance testing

Costs related to tests, to evaluate the quality of purchase and materials.

d. Inspection & testing

The activity of inspecting and testing first during the process of manufacture and
then as a final check to establish the quality of finished product.

e. Inspection & testing equipments

The depreciation costs of equipment and associated facilities.

f. Material consumed during inspection & testing

Material consumed during the course of destruction tests

g. Analysis & reporting of test & inspection results

The activity conducted prior to release of the product for transfer of ownership.

h. Field performance testing

Testing is performed in the expected user environment, prior to releasing the
product for customer acceptance.

i. Approval & endorsements

Mandatory approvals or endorsements by other authorities.

j. Record & storage

The storage of quality control results, approval and reference standards.

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 3. FAILURE COSTS:

These are subdivided into internal & external failure costs. Internal costs arising from
inadequate quality discovered before transfer of ownership from supplier to purchaser and
external costs arising from inadequate quality discovered after transfer of ownership from the
supplier to the purchaser.

Internal failure costs includes

a. Scrap
Materials, parts, components, assemblies and product end items which fail to
conform to quality requirements and which cannot be economically reworked.

b. Replacement, rework & repair

The activity of replacing or correcting defectives to make them fit for use.

c. Trouble shooting or defect / failure analysis

The costs incurred in analyzing non-conforming materials, components or products
to determine causes and remedial action.

d. Reinspection & retesting

Applied to previously failing material that has subsequently been reworked.

e. Fault of subcontractor
The losses incurred due to failure of purchased material to meet quality
requirements.

f. Modification permits & concessions

The costs of the time spent in reviewing products, designs and specifications.

g. Downgrading
Losses resulting from a price differential between normal selling price and reduced
price due to non-conformans for quality reason.

h. Downtime
The cost of personnel and idle facilities resulting from product defects and
disrupted production schedules.

External failure costs

a. Complaints:
The investigation of complaints and provision of compensation where the latter is
attributable to defective products.

b. Warranty claims:
Work to repair or replace items found to be defective by the purchaser and
accepted as the suppliers liabilities under the terms of warranty.

c. Product rejected & returned:

The cost of dealing with returned defective components. This may involve action
to either repair, replace or otherwise account for the items in question.

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Note:- While loss of purchasers goodwill and confidence is normally associated with external
failure costs. It is difficult to quantify.

d. Concessions:
Discourse made to purchasers due to non-conforming products being accepted by
the purchaser.

e. Loss of sales:
Loss of profit due to cessation of existing markets as a consequence of poor
quality.

f. Recall costs: Cost associated with recall of a liability claim.

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 Quality cost matrix

Supplier/subcontractor Inhouse Customer

Feedback, advice, training Training Joint quality planning

Vendor assessment and rating Statistical process Control Field trials
Certification and accreditation Quality circle Customers packing, handling and
storage
Prevention Develop existing and alternative Quality engineering Market research
sourcing
Audit and site inspection Quality planning Customer audit and Insp.
Joint quality planning Design of experiments

Incoming inspection Inspection and tax Product sign off/certification

Sorting Product testing Lies with customer inspection
Appraisal Returns and replacement Calibration
Inspection at suppliers sight Checking procedure

Work cost to point out scraping Isolation of causes of failures Discount on goods accepted on
concession
Rework cost Reinspection Down graded goods sold cheaply
Internal Negotiate rework Modification and concession
Failure Machining defective material Scrap and associated costs
Negotiate reimbursement

Costs attributes Analysis and correlation Customer handling

External Complaint handling of feedback data Customer returns
failure Receipt and disposal of defective Free of charge replacements
Field repairs

Warranty Costs attributes to suppliers Analysis and correlation Warranty payments

But not recoverable of feedback data Warranty claim checking
and negotiation

Excess stock Records of quality- Product reliability provision

Others Preparation of specification related activities
Quality performance
reporting
79
 Quality cost reports of a Diesel engine manufacturing company having 1300 employees and annual
turnover of £48

80
SETTING UP A QUALITY COSTING SYSTEM

It is essential right from the outset to involve accounts, as part of the team, in the collection exercise.
Quality costing is a management technique which needs to be reported accordingly in terms of management
accounting.

The purpose of quality costing should be clarified at the start of the project as this may
influence the strategy of the exercise. Prior to the collection of costs an assessment should be made of the
type of data which is available from quality management information system.

A checklist of quality cost elements can provide a useful starting point for the cost collection
exercise. The reporting of quality costs should be carried out in a disciplined manner and in such a way that
the costs make an impact and the data used to its full potential. It is important to ensure that the data
collected is comparable with previous cost reporting exercises. Consideration needs to be given to issues
such as: a standard reporting format, clarity and simplicity of reporting with minimum use of words, the
quality cost data are well presented, the data is complete, and decision to be taken by management from
the reported data are clear. The summarised data should be supported by detailed information.

ANALYSIS OF QUALITY COSTS

The quality cost data collected through a systematic programme requires to be analyzed for orienting
efforts to reduce them. The strategy for analyzing quality cost involves:
• Use zero defect programme to eliminate the failure cost
• Review the quality standards for their utility
• Use cause & effect analysis
• Eliminate through effective corrective action

USES OF QUALITY COST

1. Quality cost may be used to promote quality as a business parameter.

Costs help to keep quality aspects of the business in the spotlight. In promoting quality as an
important business parameter, some organisations are used to illustrate that everyone work does
impinge on the quality of the product and / or service and to promote ownership for quality improvement.

Knowledge of quality related costs enables business decision about quality to be made in an
objective manner. It permits the use of sensitive analysis, discounted cash flow and other accounting
methods and techniques for the evaluation of expenditure project as in any other area of the business.

Scrap, rectification and rework costs and fault finding are collected and reported in most of the
companies and are regarded as important costs which feature in companies business decisions.

Of direct interest to production engineers and technical specialist are the possibilities of effecting
saving through investment in tooling, process, equipment and mistake proofing devices. Poor standards
of tooling are frequently responsible for excess work and the extra costs.

Knowledge of quality costs is of considerable benefit in the education of staff for their commitment to
a process of continuous quality improvement.

0
 2. They give rise to performance measure.

The cost measures are used for three main purposes.

• Comparison with other parts of business

• Decision making
• Motivation

Indices and ratios are used to facilitate comparison and show changes and trends over time. The
comparative measures against which quality costs are measured is grass annual sales turnover,
manufacturing or operating cost value. Other useful bases are hours of direct production labour, units of
products, raw material usages and processing cost.

Quality costs are also used to identify products, process and departments for investigation, to
allocate resources, to set cost reduction targets and to measure progress towards targets.

Another possible use of costs in the improvement activities is that quality costing might focus
attention on the chronic problems for which compensations had been built into the system.

3. They provide the means for planning & controlling quality costs

Costs are the bases for budgeting and eventual cost control. At the beginning of each financial year
a quality plan and budget is drawn up for quality assurance, supplier quality assurance, capital
investment, training and reliability of their machines in service. All of these costs are reflected in the level
of quality costs

4. They act as motivators.

Quality costs can be used for motivational purposes as regards improvements at all levels in a
company.

Costs have been used to motivate senior managers to become interested and to take part in the
promotion of quality. Costs also enable them to see whether there is a major opportunity for waste and
cost reduction and if so, where this lies.

Uses of motivational purposes include display to shop floor workers of scrap cost arising within their
department and to emphasize to middle managers their departments contribution to total quality costs. It
is found that this group of people responds positively in terms of increased quality awareness, improved
handling of product and house keeping disciplines.

QUALITY COSTING DOs AND DON’Ts

Dos

• Get the purpose and the strategy clear at the start.

• Get data and costs from standard data whatever possible.
• Assess the accuracy and reliability of the data.
• Start with failure cost.
• Consider appraisal costs as a target for cost reduction.
• Prepare a procedure for collection and reporting of quality costs.
• Ensure that the data is used and the quality system meets its objectives.
1
Don’ts

• Forget that there are many complexities and difficulties in the measurement and collection of quality
related costs.
• Expect too much from the first attempt
• Use guessed costs or costs based on guessed data.
• Concentrate exclusively on what is already known
• Overlook the fact that concessions, design, document, and engineering changes are a major source
of quality related costs.

2
 Failure Modes & Effects Analysis(FMEA)

It is tool originated by reliability Engineers. It analyzes potential effects caused by

system elements ceasing to behave as intended.
It is a method used for identification of potential error types , in order to define its
effect on the examined object and to classify the error types with regard to criticality or
persistency. This is to prevent errors and thus weak points in the design , which might
result in a endangering or l0ss of the system and/ or in an endangering of the persons
connected with the system. FMEA is also to furnish results for corrective measures for
definition of test cases and for the determination of operating & application conditions of
the system.

‘FMEA is a structured analysis for identifying ways & methods in which the
product or processes can fail and then plan to prevent those failures. FMEA is
a proactive tool for reducing defects and non-conformities.’

Advantages of FMEA

o For improving the reliability and safety of the products.

o For improving customer satisfaction.
o Tracking actions to reduce non-conformities.
o New product development.

RELATION SHIP AMONG CAUSE , FAILURE MODE & EFFECT

Fig.1

Cause Failure Effect

Mode

CLASSICAL FMEA QUESTIONS:

1. How ( in what ways) can this element fail .(Failure Mode)
2. What will happen to the system and its environment if this element does fail in
each of the ways available to it? (Failure Effects)

DEFINITIONS:
1. Fault : Inability to function in a desired manner , OR operation in an undesired
manner regardless of cause.
2. Failure: A fault owing to breakage , wear out, compromised structural integrity etc.
All failures are faults, not all faults are failures.
Faults can be caused by actions also that are not strictly failures.

3
 FMEA through Cause & Effect Diagram
Fig.2
Causes Causes Causes

Prevent
or Detect

Failure
Mode

Effect

Causes Causes Causes

__________________________________________________________________

A system that has been shut down by safety features responding properly has not
faulted. ( e.g. Over temperature cut off )
A protection device which functions as intended . ( e.g. a blown fuse) has not
failed.
FMEA does not limit itself strictly to failures , but includes faults.
3. Failure Mode: The manner in which a fault occurs i.e. the way in which the
element faults.
Example :

ELEMENT FAILURE MODE EXAMPLE

Switch open, partly open , closed, partly closed, chatter.
Valve open, partly open, closed, partly closed, wobble.
Spring stretch, compress / collapse, fracture.
Cable stretch, break, kink, frey.
Relay contacts closed, cnatacts open, coil burnt out, coil short
Operator Wrong operation to proper item, wrong oprn. to wrong item,
proper oprn. to wrong item , perform too early, perform too late,
fail to perform.
4. Failure Effect : The consequences of a failure mode on an operation , function,
status of a system,/ process/activity/ environment. The undesirable outcome of a
fault of a system element in a particular mode.

The effect may range from relatively harmless impairment of performance to

multiple fatalities, major equipment loss, and environmental damage.

4
5. Failed /Faulted SAFE: Proper function is compromised, but no further threat of
harm exists (e.g. a smoke detector alarms in the absence of smoke).
6. Failed / Faulted DANGEROUS : Proper function is impaired or lost in a way which
poses threat of harm, ( e.g. a smoke detector does not alarm in the presence of smoke).

FMEA USES AND APPLICATIONS:

1. Identify individual elements/ operations within a system that may render it
vulnerable . (Single point Failure).
2. Identity failure effects:
a) General description
b) Specific severity and probability assessment
3. Following Industry uses FMEA.
a) Consumer Products, Automotive / Toys, Home appliances etc.
b) Aero space
c) Process Industries – Chemical processing.

PROCESS OF FMEA:
1. Define the system to be analyzed .Divide the system into sub-system and / or
assemblies in order to localize the search for components.
2. Obtain necessary drawings, charts, descriptions, diagrams, component list etc.
Know exactly what you are analyzing :
Is it an area, activity, equipment? All of it or part of it? what targets are to be
considered?
3. Break the system down into convenient and logical elements. System breakdown
can be either functional (i.e. according to what the system elements do ) OR
geographical / architectural ( i.e. according to where system elements are ) or
both.
4. Develop a complete component list for each assembly.
5. Establish a coding system to identify system elements.
6. Identify operational and environmental stresses that can affect the system.
Consider how these might affect the performance of individual components.
7. Determine the failure modes of each component and the effect of failure mode on
entire system, sub. System, assy. Sub assy. .
8. Categorize the hazard level (severity) of each failure mode. (5 level)
9. Estimate the probability .
10.Develop recommendations to enhance the system performance.
These fall into two categories :
A. Preventive action – avoiding a failure situation.
B. Compensatory actions: Minimizing the losses in the event that a failure
occurs.

11.Summarize your analysis in tabular form.

Ask the following questions.

1. Will a failure of the system result in intolerable / undesirable loss?

If No: Document and end the analysis.
If Yes: Divide the system into subsystem & ask the above question .

If No: Document and end the analysis .

5
 If Yes : Divide the subsystem into assemblies and ask the question with each
assembly.

If No : Document and end the analysis.

If yes: Divide the assembly into component / piece parts and ask the above
question with each component / piece part.
2. For each analyzed element what are the failure modes?
3. For each failure mode, what are the failure effects?
(Including the severity and probability assessment)
4. Consider the interface also.
(Interface: the interaction points, necessary to produce the desired / essential effects,
between system elements. Interfaces transfer energy/ information, maintain
mechanical integrity etc. )

System breakdown can be

A. Functional
1. Cooling System
2. Propulsion system
3. Brake system
4. Steering system

B. Geographic
1. Engine Compartment
2. Passenger compartment
3. Dash Board / Control Panel
4. Rear End

SYSTEM BREAK DOWN EXAMPLE :

SYSTEM SUB ASSEMBLY SUB COMPONENT

SYSTEM ASSEMBLY
Automobile 1.Cooling 1. Radiator 1. Radiator 1. Metallic
2. W.P. Body water jackets
3. Coolant 2. Cap 2. Fins.
4. Hoses
5. Clamps
6. Engine
block
7. Thermostat

2.Brake 1.Standare 1. Master 1.Piston

2. Emergency Cylinder 2.Bucket
2. Front 3. Spring
brake assy. 4. Cap
3. Rear 5. Body
brake assy.
4. Pipe
Lines
5. Brake
6
 Fluid

Ranking terms used in FMEA calculations

Scale:1(Best) to 10 ( Worst)

• Severity (SEV) : Severity indicates how severe is the impact of the effect on the
customer.
• Occurrence (OCC) : This indicates the likelihood of the cause of the failure mode to
occur.
• Detection (DET) : This indicates the likelihood of the current system to detect the
cause or failure mode if it occurs.
• Risk priority number: This number is used to place priority to items for better
quality planning.
RPN = SEV X OCC X DET

7
 Decision On Rating

Rating Degree of Severity Likelihood of Occurrence Ability to detect

1 Customer will not at all observe Very remote possibility Sure that the potential failure
the adverse effect will be detected & prevented
before reaching the next
customer

2 Customer will experience Low failure with supporting Almost sure that the potential
slight discomfort documents failure will be detected before
reachig the next customer

3 Customer will experience Low failure without supporting Less chances that the
annoyance because of slight documents potential failure will reach the
degradation of performance next customer undetected

4 Customer dissatisfied due to Occasional failures Some controls may detect

reduced performance the potential from reaching the
next customer

5 Customer is uncomfortable Moderate failure rate with Moderate chances that the
supporting documents potential failure will reach the

6 Warranty repairs Modearate failure rate without Controls are not likely to detect
supporting documents or prevent the potential failure
from reaching the next
customer

7 High degree of customer High failure rate with supporting Less chances that the potential
dissatisfaction documents failure will be detected or
prevented before reaching
the next customer

8 Vey high degree of customer High failure rate with supporting Very less chances that the
dissatisfaction documents potential failure will be detected
or prevented before reaching
the next customer

9 Negative impact on the Failure is almost certain Existing controls will not detect
customer the potential failure

10 Negative impact on the Assured failure Existing controls will not detect
customer, people & society the potential failure

8
 Sample FMEA Form: ( Column 1 to 9 )
Rank severity Rank occurrence List how the cause Rank how well
on 1 to 10 on a 1 to 10 is presently cause/failure
scale scale being controlled can be detected
on 1 to 10 scale

1 2 3 4 5 6 7 8 9
Process Potential failure mode Potential failure effect SEV Potential causes OCC Current Controls DET RPN
Part No.

1
2
3
4
5

List failure List effects List causes RPN=

modes for each of each SEV*OCC*DET
step failure mode for each failure
mode

FMEA Form contd: ( column 10 to 15 )

Designates people RPN is recalculated

responsible for on completion of
corrective action corrective action

10 11 12 13 14 15
Actions Recommended Responsibility SEV OCC DET RPN

List actions
recommended
on RPN pareto

9
 INTERNAL AUDIT
General principles of Auditing

During audit basically an auditor looks for three

aspects of QMS. Whether the system is
• Adequately defined
• Is being followed
• Is effective – provides the correct degree of assurance when followed.

Features of quality system auditing.

1. An effective management tool to examinee activities and process. Mgt. can act on the information
received from audit result.

2. Objectivity, Independence and systematic approach are the core principles for effective & efficient
audit.

3. Audit are authorised, authority may result from

• Decision of management.
• Company policy.
• Provisions of contracts.
• The audit Clint.
• Legislation or regulation.

4. Audit programmes and audits are planned.

5. Audits are conducted using established methods and techniques to ensure that audit evidence & audit
findings are relevant, reliable & sufficient.

6. The scope, objective and audit criteria of each audit are clearly defined and agreed prior to
commencing the audit.

7. Audit team member are competent for the task they perform.

8. Audit team member act with due professional care and adhere to a code of ethics. Example – auditor
behaviour, integrity, confidentiality, free from Bias etc.

Frequency of audit :- is determined by the

1. Status of implementation of Quality System.

2. Previous audit reports.
3. Status of corrective actions.

Process of Audit
P – Planning
E – Execution
R – Reporting
C – Follow up / Close out of Corrective Actions.

10
 In evolves logic, system & facts.
What he (auditor) is looking for Æ if for a system – which exist – is correctly operated and effective. He
directs his efforts to obtain proof for these. So Basic Questions.

1. Existence Æ is the system defined.

2. Operation Æ is the documented system implemented.
3. Effectiveness Æ is the practice effective . How for the system is fulfilling the requirement.

A best way to use check list. It should be used to remind the auditor of the information required or the
facts to be verified. It should not be used as a list of Questions to be asked.

Good planning & experience helps in choosing correct audit samples that reveals typical faults.

Take notes during the process of auditing.

Auditing practice

• Always focus attention at the work place.

• Avoid desk audit.

Audit planning :- Internal Audit

It is done by Q.A. department/ISO cell (MR).

1. Details of personals, process, products & time involved are considered.

2. Certain department may require frequent audits.
3. Mostly internal audits are conducted on departmental basis.
4. Whether all the departments are to be audited against a particular clause of ISO 9001. (During
Compliance audit weakness against a particular clause has been noticed).
5. Recruitment of audit team.
a) Normally two members.
b) Specialist in case of highly technical operation.
c) Availability of Auditor.

Selection of Auditor:
• Independent
• Trained
• Knowledge about the area to be audited.
• Auditor is expected to have
1. Communication skill
2. Knowledge & understanding of standard.
3. Assessment techniques ( like examining, questioning )

Qualities of auditor :

• Objective
• Precise & Practical
• Professional
• Principled
• Polite

11
 • Punctual
• Positive
• Prepared
• Good listener
• Good communication skill

List of items taking into the audit

• Audit plan & check list.

• Copies of Quality Manual, departmental procedures, work restrictions etc.
• Copy of the standard.
• Note Book.
• N.C.R. report forms.

6. Audit planning should be done keeping in view the audit scope.

• For carrying one fall assessment – all aspects of standard for the department.
• For closing out not & conformances reported from previous audit.

N.B. - In case of third party audit, surveillance audit is carried out for continuing certification.

7. Planning information sources

• Past history of audit

• Customer complaints
• Senior Management concerns over particular aspect of Company’s operation.
• Previous Management Review Records.

Conducting the Audit

1. Opening Meeting :-
ƒ Introduction.
ƒ Review of scope & objective.
ƒ Methods & Procedures of conducting audit.
ƒ Availability of guide.
ƒ Special requirements of safety kits, masks etc.
ƒ Any other point.
2. The audit is conducted by the team member separately or area wise depending upon the area to be
covered, time available, and no. of team members.

3. The objective evidences are recorded by the team members in their observation notes and in case of
NCR, a acceptance is obtained from the guide or concerned person then & there as far as possible.

4. A summery of audit is prepared and presented in the closing meeting at the end of audit with H of D
or his nominee/representative.

5. A final report is submitted to concerned department. with a copy to MR.

6. Corrective action shall be planned initial by H of D. under intimation to MR who monitors the timely
compliance.

12
 Auditing Techniques

• Horizontal approach design the audit plan to audit each clause of the standard right across the
Org.

• Vertical approach – designs the audit plan to audit each department of the Org. against all the
elements of the relevant standard.

• Combination approach.

Note –
1. Internal auditing is planned in Vertical method.
2. Third party auditing is planned in a combination approach.

Auditing is performed based on random samples of product/processes/activities/records picked up for

verification and investigated for compliance/conformance in any of these methods.

• Random checking.
• Trace forward. (A logical system & Good for full audit).
• Trace Back. (Good for partial Audit).

Trace forward ( A logical, Good for full audit)

R&D Æ Design Æ Procure Æ Manufacture Æ Inspection/Test Æ Pack and dispatch Æ Delivery to
customer Æ After sales service.

Trace Back (Good partial Audits)

Contract with customer Æ Sales Æ Packing / Stores Æ Inspection Æ Manufacture Æ Procure Æ
Design Æ R&D.

AUDIT REPORTING
Audit findings need to be documented and reported so that – corrective actions are identified and taken by
the auditee. It involves following aspects –
1. Compliance of Q.S. requirement.
2. N.C. against Q.S. requirements.
3. System effectiveness.
In internal audit, effectiveness is normally examined during the mgt. review.

1. REPORTING OF COMPLIANCE
Compliance to the requirement of Q.S. is established when details of Audit sample examined are
documented, Details may include the following.

1. Name of the person with whom discussion was held.

2. Place where this happened.
3. Reference to process/equipment/facility relevant to the sample.
4. Documents examined.
5. Records verified.
6. Details of audit trials.
13
 7. Reference to clause of Std.
8. Reference to relevant documents used or referred to Q.S.
9. Reference to NCR, as and when they are revealed.

2. REPORTING OF NON COMPLIANCE

1. It helps in identifying corrective action.
2. During certification audit & surveillance Audit, status of outstanding NCRs is ascertained.
3. NC should be complete, it should not give rise to any ambiguity or misinterpretation.

Following should be considered while raising NC

a. A NC is a condition adverse to quality.
b. A NC arises when specified requirement are violated which can be indicated as follows –
• Conditions of contract (with Purchaser/Clint).
• Quality manual.
• Procedures.
• Work Instructions.
• ISO 9001 Std. Requirements.

c. A NC may arise in any of the following condition.

• Written procedure does not comply with requirements of ISO 9001 standard.
• Written procedures are not implemented as described in the procedures.
• The practice is not effective i.e. required output is not achieved.

d) A NC should include following aspects.

a. Exact observation of the fact.
b. Where was it found.
c. What was found.
d. Why it is non conformance.
e. Who was there – indicate designation not name.
f. Use local terminology.
g. Make it retrievable & helpful
e) NC should be carefully worded.
f ) Seriousness of NC should be judged on the
basis of following
• What could go wrong if NC remain uncorrected.
• What is the likelihood of such a thing going wrong.

g) . NC can be classified MAJOR if.

i. A significant non conformance with standard requirement.
ii. A failure of complete system.
iii. Lack of QMS requirement.
iv. Significant number of minor NCs.

h. N.C. can be classified MINOR if

i. An isolated witnessed incident of failure to comply with a procedure or QMS requirement.
ii. Minor problem requiring attention..

i. Following should be ensured while raising NC.

14
 The department/area should be made aware about the fact by the auditor before leaving the area.

Example for the points discussed above

Example :1 Section 1 of QM requires job description to be made available for all officers and
supervisors. No. job description is available for the supervisor in stores.

Example : 2. The validity of the a purchase offer to M/S ABC. identifies 31.7.2002 and changed
to 31.10.2002 without reference to customer agreement on this.

PROCESS APPROACH

What is Procedure ?

Procedure is a way in which one works to accomplish a task. It can bee a sequence of steps that
includes preparation, conduct & completion of task. Procedures are intended to make something
happen in a certain way.

When we are not concerned about how something is done and are interested in results, these
may be called instructions. Such as ‘Post the letter’. Repair the m/c etc.

What is Process ?

15
 Any activity or operation, which receive input and converts them into output, can be
considered as a process. For functioning an organisation has to define and manage nos. of inter
related processes. Often output from one process will be input for next process. We process the
information. We do not procedure information but we may employ a procedure to process
information.
Example :
1. Curd making or
2. Plating process & plating procedure.
Plating process – Comprises the resources, people plat & m/c (6M).
planting procedure contains – instructions as how to plate material.

INPUT

MEN BLENDIN PROCESS

MATERIAL OUTPUT
MACHINE
METHOD
MILIEU
MEASUREMENT – CUSTOMER REQUIREMENTS

Customer Req. Æ Stated Needs + Implied Needs + Expectations.

“ The systematic identification & management of various processes employed with in an Org. and
particularly the interaction between such processes, is referred to as “Process approach”.

PROCESS MAPPING (FLOW CHART)

SYMBOLS

Operation -
Start /End -
Inspection -
Decision box -
Transportation -
Storage -
Delay -
Connectors -
Exercise :- Flow Chart for filling Petrol in a car.

16
The standards, guidelines and technical reports which make up the ISO 9000 family and which are listed
below are available separately, or as collections. The ISO 9000 Compendium
presents the ISO 9000 family in hard copy form.
Standards and guidelines
ISO 9000:2000, Quality management
systems – Fundamentals and
vocabulary
ISO 9001:2000, Quality management
systems – Requirements
ISO 9004:2000, Quality management
systems –Guidelines for performance
improvements
ISO 19011, Guidelines on Quality
and/or Environmental Management
Systems Auditing (currently under
development)
ISO 10005:1995, Quality
management – Guidelines for quality
plans
ISO 10006:1997, Quality
management – Guidelines to quality in
project management
ISO 10007:1995, Quality
Purpose
Establishes a starting point for
understanding the standards and
defines the fundamental terms and
definitions used in the ISO 9000
family which you need to avoid
misunderstandings in their use.
This is the requirement standard
you use to assess your ability to
meet customer and applicable
regulatory requirements and
thereby address customer
satisfaction.
It is now the only standard in the
ISO 9000 family against which
third-party certification can be
carried.
This guideline standard provides
guidance for continual improvement
of your quality management system
to benefit all parties through
sustained customer satisfaction.
Provides you with guidelines for
verifying the system's ability to
achieve defined quality objectives.
You can use this standard
internally or for auditing your
suppliers.
Provides guidelines to assist in the
preparation, review, acceptance and
revision of quality plans.
Guidelines to help you ensure the
quality of both the project processes
and the project products.
Gives you guidelines to ensure that
17
management – Guidelines for a complex product continues to
configuration management function when components are
changed individually.

ISO/DIS 10012, Quality assurance Give you guidelines on the main

requirements for measuring equipment features of a calibration system to
– Part 1: Metrological confirmation ensure that measurements are
system for measuring equipment made with the intended accuracy.

ISO 10012-2:1997, Quality assurance Provides supplementary guidance

for measuring equipment– Part 2: on the application of statistical
Guidelines for control of measurement process control when this is
of processes appropriate for achieving the
objectives of Part 1.

ISO 10013:1995, Guidelines for Provides guidelines for the

developing quality manuals development, and maintenance of
quality manuals, tailored to your
specific needs.

ISO/TR 10014:1998, Guidelines for Provides guidance on how to

managing the economics of quality achieve economic benefits from the
application of quality management.

ISO 10015:1999, Quality Provides guidance on the

management – Guidelines for training development, implementation,
maintenance and improvement of
strategies and systems for training
that affects the quality of products.

ISO/TS 16949:1999,Quality systems Sector specific guidance to the

– Automotive suppliers – Particular application of ISO 9001 in the
requirements for the application of automotive industry.
ISO 9001:1994

18
Ordnance Factories Institute of Learning

Dehradun

Student version of

Quality Management System

Standard

ISO 9001: 2000

(For Training Purpose only)

ISO 9001:2000, QUALITY MANAGEMENT SYSTEM

REQUIREMENTS

(Second Revision)

19
 Introduction
0.1 General: The adoption of a quality management system should be a strategic
decision of an organisation. The design and implementation of an organisation’s
quality management system is influenced by varying needs, particular objectives, the
products provided, the processes employed and the size and structure of the
organisation. It is not the intent of this International Standard to imply uniformity in
the structure of quality management systems or uniformity of documentation.
The quality management system requirements specified in this International
Standard are complementary to requirements for products. Information marked
“NOTE” is for guidance in understanding or clarifying the associated requirement.
This International Standard can be used by internal and external parties, including
certification bodies, to asses the organisation’s ability to meet customer, regulatory
and the organisation’s own requirements.
The quality management principles stated in ISO 9000 and ISO 9004 have been
taken into consideration during the development of this International Standard.
0.2 Process Approach
This International Standard promotes the adoption of a process approach
when developing, implementing and improving the effectiveness of a quality
management system, to enhance customer satisfaction by meeting customer
requirements.

For an organization to function effectively, it has to identify and manage

numerous linked activities. An activity using resources, and managed in order to
enable the transformation of inputs into outputs, can be considered as a process.
Often the output from one process directly forms the input to the next.

The application of a system of processes within an organization, together with

the identification and interactions of these processes, and their management, can be
referred to as the “process approach”.

An advantage of the process approach is the ongoing control that it provides

over the linkage between the individual processes within the system of processes, as
well as their combination and interaction .

When used within a quality management system, such an approach

emphasizes the importance of

(a) understanding and fulfilling the requirements,

(b) the need to consider processes in terms of added value,
(c) obtaining results of process performance and effectiveness, and
(d) continual improvement of processes based on objective measurement.

The model of a process-based quality management system shown in figure 1

illustrates the process linkages presented in clause 4 to 8. This illustration
shows that customers play a significant role in defining requirements as
inputs. Monitoring of customer satisfaction requires the evaluation of
information relating to customer perception as to whether the organization
 has met their requirements. The model shown in figure 1 covers all the
requirements of the International Standard, but does not show processes at a
detailed level .
NOTE In addition, the methodology known as “Plan-Do-Check-Act” (PDCA)
can be applied to all processes. PDCA can be briefly described as follows.

Plan: establish the objectives and processes necessary to deliver results in

accordance with customer requirements and the organisation’s policies.

Do: implement the process

Check: monitor and measure processes and product against policies,

objectives and requirements for the product and report the results.

Act: take actions to continually improve process performance.

0.3 Relationship with ISO 9004
The present editions of ISO 9001 and ISO 9004 have been developed as a
consistent pair of quality management system standards which have been designed
to complement each other, but can also be used independently. Although the two
International Standards have different scopes, they have similar structures in order
to assist their application as a consistent pair.
ISO 9001 specifies requirements for a quality management system that can
be used for internal application by organisations, or for certification, or for contractual
purposes. It focuses on the effectiveness of the quality management system in
meeting customer requirements.
ISO 9004 gives guidance on a wider range of objectives of a quality
management system than does ISO 9001, particularly for the continual improvement
of an organisation’s overall performance and efficiency, as well as its effectiveness.
ISO 9004 is recommended as a guide for organisations whose top management
wishes to move beyond the requirements of ISO 9001, in pursuit of continual
improvement of performance. However, it is not intended for certification or for
contractual purposes.

0.4 Compatibility with other management systems

This International Standard has been aligned with ISO 14001:1996 in order to
enhance the compatibility of the two Standards for the benefit of the user community.
This International Standard does not include guidance specific to other
management systems, such as those particular to environmental
management, occupational health and safety management, financial
management, or risk management. However, this International Standard
enables an organisation to align or integrate its own quality management
system with related management systems requirements. It is possible for an
organisation to adapt its existing management system(s) in order to establish
 a quality management system that complies with the requirements of this
International Standard.

CONTINUAL IMPROVEMENT OF THE

QUALITY MANAGEMENT SYSTEM

Management
responsibility C
CUSTOMERS

U
Measurement, S
Resource
analysis, T
SATISFACTION
management
improvement O
M
CUSTOMERS
E
Input Product R
Product/
REQUIREMENT S
realization Service Output SATISFACTION

Fig. 1 Model of a process-based Quality

Management System
KE
VALUE-ADDING ACTIVITIES

INFORMATION FLOW
1.Scope
1.1 General

This International Standard specifies requirements for a Quality Management

system where an organisation
a) needs to demonstrate its ability to consistently provide product that meets
customer and applicable regulatory requirements and
b) aims to enhance customer satisfaction through the effective application of the
system , including processes for continual improvement of the system and the
assurance of conformity to customer and applicable regulatory requirements.
Note : In this international standard the term ‘product’ applies only to the product
intended for, or required by a customer.

1.2 Application
 All requirements of this International Standard are generic and are intended to be
applicable to all organizations , regardless of type , size and product provided.
Where any requirement(s) of this International Standard can not be applied due
to the nature of an organization and its products , this can be considered for
exclusions.
Where exclusions are made , claims of conformity to this International Standard
are not acceptable unless these exclusions are limited to requirements within
clause 7, and such exclusions do not affect the organization’s ability , or
responsibility , to provide product that meets customer and applicable regulatory
requirements.
2 Normative reference
The following normative document contains provisions which, through reference in
this text, constitute provisions of this International Standard. For dated references,
subsequent amendments to, or revisions of, any of these publications do not apply.
However, parties to agreements based on this International Standard are
encouraged to investigate the possibility of applying the most recent edition of the
normative document indicated below. For undated references, the latest edition of
the normative document referred to applies. Member of ISO and IEC maintain
registers of currently valid International Standards.
ISO 9000: 2000, Quality management systems - Fundamentals and vocabulary.

3 Terms and definitions

For the purposes of this International Standard, the terms and definitions given in
ISO 9000 apply.

The following terms, used in this edition of ISO 9001 to describe the supply-
chain, have been changed to reflect the vocabulary currently used :
Supplier Æ Organization Æ Customer

The term ‘organization’ replaces the term ‘supplier’ used in ISO 9001:1994
and refers to the unit to which this International Standard applies. Also the term
‘supplier’ now replaces the term ‘sub contractor’

Throughout the text of this International Standard, wherever the term “product”
occurs, it can also mean “service”.

4 Quality Management System

4.1 General requirements

The organisation shall establish, document, implement and maintain a quality

management system and continually improve its effectiveness in accordance with
the requirements of this International Standard.

The organization shall

a) Identify the processes needed for the quality management system and their
application throughout the organization,(see 1.2),
b) Determine the sequence and interaction of these processes,
c) Determine criteria and methods needed to ensure that both the operation and
control of these processes are effective,
d) Ensure the availability of resources and information necessary to support the
operation and monitoring of these processes,
e) Monitor, measure and analyse these processes, and
f) Implement actions necessary to achieve planned results and continual
improvement of these processes.

These processes shall be managed by the organization in accordance with the

requirements of this International Standard

Where an organization chooses to outsource any process that affects product

conformity with requirements, the organization shall ensure control over such
processes. Control of such outsourced processes shall be identified within the quality
management system.

Note : Processes needed for the quality management system referred to above
should include processes for management activities, provision of resources, product
realization and measurement.

4.2 Documentation requirements

4.2.1 General
The quality management system documentation shall include

a) documented statements of quality policy and quality objectives.

b) a quality manual

c) documented procedures required by this International Standard.

d) documents needed by the organization to ensure the effective planning,

operation and control of its processes and

e) records required by this International Standard ( see 4.2.4 )

NOTE 1 Where the term “documented procedure” appears within this

International Standard, this means that the procedure is established, documented,
implemented and manintained.

NOTE 2 The extent of the quality management system documentation can differ
from one organization to another due to

a) the size of organization and type of activities,

b) the complexity of processes and their interactions, and
c) the competence of personnel.

NOTE 3 The documentation can be in any form or type of medium

4.2.2 Quality manual

The organization shall establish and maintain a quality manual that includes
a) the scope of the quality management system, including details of and
justification for any exclusions ( see 1.2 )
b) The documented procedures established for the quality management system,
or reference to them, and
c) A description of the interaction between the processes of the quality
management system.

4.2.3 Control of documents

Documents required by the quality management system shall be controlled. Records

are a special type of document and shall be controlled according to the requirements
given in 4.2.4

A documented procedure shall be established to define the controls needed

a) to approve documents for adequacy prior to issue,
b) to review and update as necessary and re-approve documents,
c) to ensure that changes and the current revision status of documents are
identified.
d) to ensure that relevant versions of applicable documents are available at
points of use,
e) to ensure that documents remain legible and readily identifiable,
f) to ensure that documents of external origin are identified and their distribution
controlled, and
g) to prevent the unintended use of obsolete documents, and to apply suitable
identification to them if they are retained for any purpose.

4.2.4 Control of records

Records shall be established and maintained to provide evidence of conformity to

requirements and of the effective operation of the quality management system.
Records shall remain legible, readily identifiable and retrievable. A documented
procedure shall be established to define the controls needed for the identification,
storage, protection, retrieval, retention time and disposition of records.
ISO 9001:2000, Quality management systems – Requirements

5 Management responsibility

5.1 Management commitment

Top management shall provide evidence of its commitment to the development and
implementation of the quality management system and continually improving its
effectiveness by

a) communicating to the organization the importance of meeting customer as

well as statutory and regulatory requirements,
b) establishing the quality policy,
c) ensuring that quality objectives are established
d) conducting management reviews, and
e) ensuring the availability or resources
5.2 Customer focus

Top management shall ensure that customer requirements are determined and are
met with the aim of enhancing customer satisfaction. ( see 7.2.1 & 8.2.1 )

5.3 Quality policy

Top management shall ensure that the quality policy

a) is appropriate to the purpose of the organization.

b) includes a commitment to comply with requirements and continually improve
the effectiveness of the quality management system,
c) provides a framework for establishing and reviewing quality objectives,
d) is communicated and understood within the organization, and
e) is reviewed for continuing suitability

5.4 Planning

5.4.1 Quality objectives

Top management shall ensure that quality objectives, including those needed to
meet requirements for product, (see 7.1(a) ) are established at relevant functions
and levels within the organization. The quality objectives shall be measurable and
consistent with the quality policy.

5.4.2 Quality management system planning

Top management shall ensure that

a) the planning of the quality is carried out in order to meet the requirements
given in 4.1, as well as the quality objectives, and
b) the integrity of the quality management system is maintained when changes
to the quality management system are planned and implemented.

5.5 Responsibility, authority and communication

5.5.1 Responsibility and authority

Top management shall ensure that responsibilities and authorities are defined and
communicated within the organization.

5.5.2 Management representative

Top management shall appoint a member of management who, irrespective of other

responsibilities, shall have responsibilities and authority that includes

a) ensuring that processes needed for the quality management system are
established, implemented and maintained,
b) reporting to top management on the performance of the quality management
system and any need for improvement, and
c) ensuring the promotion of awareness of customer requirements throughout
the organization

NOTE: The responsibility of a management representative can include liaison

with external parties on matters relating to the quality management system.

5.5.3 Internal communication

Top management shall ensure that appropriate communication processes are

established within the organization and that communication takes place regarding
the effectiveness of the quality management system

5.6 Management review

5.6.1 General

Top management shall review the organization’s quality management system, at

planned intervals, to ensure its continuing suitability, adequacy and effectiveness.
This review shall include assessing opportunities for improvement and the need for
changes to the quality management system, including the quality policy and quality
objectives.

Records from management reviews shall be maintained ( see 4.2.4)

5.6.2. Review Input

The input to management review shall include information on

a) results of audits,
b) customer feedback,
c) process performance and product conformity
d) status of preventive and corrective actions,
e) follow-up actions from previous management reviews,
f) changes that could affect the quality management system, and
g) recommendations for improvement.
5.6.3 Review output

The output from the management review shall include any decisions and actions
related to

a) improvement of the effectiveness of the quality management system and its

processes,
b) improvement of product related to customer requirements, and
c) resource needs.

6 Resource management

6.1 Provision of resources

The organization shall determine and provide the resources needed

a) to implement and maintain the quality management system and continually
improve its effectiveness, and
b) to enhance customer satisfaction by meeting customer requirements.

6.2 Human resources

6.2.1 General

Personnel performing work affecting product quality shall be competent on the basis
of appropriate education, training, skills and experience.

6.2.2 Competence, awareness and training

The organization shall

a) determine the necessary competence for personnel performing work affecting
product quality,
b) provide training or take other actions to satisfy these needs,
c) evaluate the effectiveness of the actions taken,
d) ensure that its personnel are aware of the relevance and importance of their
activities and how they contribute to the achievement of the quality objectives,
and
e) maintain appropriate records of education, training, skills and experience. (
see 4.2.4 )

6.3 Infrastructure

The organization shall determine, provide and maintain the infrastructure needed to
achieve conformity to product requirements. Infrastructure includes, as applicable.
a) buildings, workspace and associated utilities,
b) process equipment (both hardware and software), and
c) supporting services (such as transport or communication).
6.4 Work environment

The organization shall determine and manage the work environment needed to
achieve conformity to product requirements.

7. Product realization

7.1 Planning of product realization

The organization shall plan and develop the processes needed for product
realization. Planning of product realization shall be consistent with the requirements
of the other processes of the quality management system.(see 4.1)

In planning product realization, the organization shall determine the following, as

appropriate:

a) quality objectives and requirements for the product ‘

b) the need to establish processes, documents, and provide resources specific
to the product
c) required verification, validation, monitoring, inspection and test activities
specific to the product and the criteria for product acceptance;
d) records needed to provide evidence that the realization processes and
resulting product meet requirements.( see 4.2.4)
The output of this planning shall be in a form suitable for the organization’s method
of operations.

NOTE 1 A document specifying the processes of the quality management

system (including the product realization processes) and the resources to be applied
to a specific product, project or contract, can be referred to as a quality plan.
NOTE 2 The organization may also apply the requirements given in 7.3 to the
development of product realization processes.

7.2 Customer-related processes

7.2.1 Determination of requirements related to the product

The organization shall determine

a) requirements specified by the customer, including the requirements for

delivery and post-delivery activities,
b) requirements not stated by the customer but necessary for specified or
intended use, where known,
c) statutory and regulatory requirements related to the product, and
d) any additional requirements determined by the organization,

7.2.2 Review of requirements related to the product

The organization shall review the requirements related to the product. This
review shall be conducted prior to the organization’s commitment to supply a product
to the customer (e.g. submission of tenders, acceptance of contracts or orders,
acceptance of changes to contracts or orders) and shall ensure that
a) product requirements are defined,
b) contract or order requirements differing from those previously expressed are
resolved, and
c) the organization has the ability to meet the defined requirements.
Records of the results of the review and actions arising from the review shall
be maintained.( see 4.2.4 )
Where the customer provides no documented statement of requirement,
the customer requirements shall be confirmed by the organization before
acceptance.
Where product requirement are changed, the organization shall ensure that relevant
documents are amended and that relevant personnel are made aware of the
changed requirements.

NOTE In some situations, such as internet sales, a formal review is

impractical for each order. Instead the review can cover relevant product information
such as catalogues, or advertising material.

7.2.3 Customer communication

The organization shall determine and implement effective arrangements for

communicating with customers in relation to

a) product information
b) enquiries, contracts or order handling, including amendments, and
c) customer feedback, including customer complaints

7.3 Design and development

7.3.1 Design and development planning

The organization shall plan and control the design and development of product.

During the design and development planning, the organization shall determine
a) the design and development stages,
b) the review, verification and validation that are appropriate to each design and
development stage, and
c) the responsibilities and authorities for design and development.
The organization shall manage the interfaces between different groups involved in
design and development to ensure effective communication and clear assignment of
responsibility.
Planning output shall be updated, as appropriate, as the design and development
progresses.

7.3.2 Design and development inputs

Inputs relating to product requirements shall be determined and records maintained.(

see 4.2.4 ) These inputs shall include

a) functional and performance requirements,

b) applicable statutory and regulatory requirements,
c) where applicable, information derived from previous similar designs , and
d) other requirements essential for design and development

These inputs shall be reviewed for adequacy. Requirements shall be complete,

unambiguous and not in conflict with each other.

7.3.3 Design and development outputs

The outputs of design and development shall be provided in a form that enables
verification against the design and development input and shall be approved prior to
release.

Design and development outputs shall

a) meet the input requirements for design and development,
b) provide appropriate information for purchasing, production and for service
provision,
c) contain or reference product acceptance criteria, and
d) specify the characteristics of the product that are essential for its safe and
proper use.

7.3.4 Design and development review

At suitable stages, systematic reviews of design and development shall be

performed in accordance with planned arrangements( see 7.3.1)
a) to evaluate the ability of the results of design and development to meet
requirements, and
b) to identify any problems and propose necessary actions.

Participants in such reviews shall include representatives of functions

concerned with the design and development stage(s) being reviewed. Records of the
results of the reviews and any necessary actions shall be maintained.(see 4.2.4)

7.3.5 Design and development verification

Verification shall be performed in accordance with planned arrangements

(see 7.3.1) to ensure that the design and development outputs have met the design
and development input requirements. Records of the results of the verification and
any necessary actions shall be maintained.( see 4.2.4)

7.3.6 Design and development validation

Design and development validation shall be performed in accordance with

planned arrangements (see 7.3.1) to ensure that the resulting product is capable of
meeting the requirements for the specified application or intended use, where
known. Wherever practicable, validation shall be completed prior to the delivery or
implementation of the product. Records of the results of validation and any
necessary actions shall be maintained.(see 4.2.4)

7.3.7 Control of design and development changes

Design and development changes shall be identified and records maintained.

The changes shall be reviewed, verified and validated, as appropriate, and approved
before implementation. The review of design and development changes shall include
evaluation of the effect of the changes on constituent parts and product already
delivered.

Records of the results of the review of changes and any necessary action
shall be maintained .(see 4.2.4).

7.4 Purchasing

7.4.1 Purchasing process

The organization shall ensure that purchased product conforms to specified

purchase requirements. The type and extent of control applied to the supplier
and the purchased product shall be dependent upon the effect of the
purchased product on subsequent product realization or the final product.

The organization shall evaluate and select suppliers based on their ability to
supply product in accordance with the organization’s requirements. Criteria for
selection, evaluation and re-evaluation shall be established. Records of the results of
evaluations and any necessary actions arising from the evaluation shall be
maintained .(see 4.2.4).
7.4.2 Purchasing information

Purchasing information shall describe the product to be purchased, including where

appropriate

a) requirements for approval of product, procedures, processes and equipment,

b) requirements for qualification of personnel, and
c) quality management system requirements.

The organization shall ensure the adequacy of specified purchase

requirements prior to their communication to the supplier.

7.4.3 Verification of purchased product

The organization shall establish and implement the inspection or other

activities necessary for ensuring that purchased produced meets specified purchase
requirements.

Where the organization or its customer intends to perform verification at the

supplier’s premises, the organization shall state the intended verification
arrangements and method of product release in the purchasing information.

7.5 Production and service provision

7.5.1 Control of production and service provision

The organization shall plan and carry out production and service provision under
controlled conditions. Controlled conditions shall include, as applicable

the availability of information that describes the characteristics of the product,

the availability of work instructions, as necessary,
the use of suitable equipment,
the availability and use of monitoring and measuring devices,
the implementation of monitoring and measurement, and
the implementation of release, delivery and post-delivery activities.

7.5.2 Validation of processes for production and service provision

The organization shall validate any processes for production and service provision
where the resulting output cannot be verified by subsequent monitoring or
measurement. This includes any processes where deficiencies become apparent
only after the product is in use or the service has been delivered.

Validation shall demonstrate the ability of these processes to achieve planned

results.

The organization shall establish arrangements for these processes including, as

applicable

a) defined criteria for review and approval of the processes,

b) approval of equipment and qualification of personnel,
c) use of specific methods and procedures,
d) requirements for records, .(see 4.2.4) and
e) revalidation.

7.5.3 Identification and traceability

Where appropriate , the organization shall identify the product by suitable means
throughout product realization.
The organization shall identify the product status with respect to monitoring and
measurement requirements.
Where traceability is a requirement, the organization shall control and record the
unique identification of the product. .(see 4.2.4)

Note In some industry sectors, configuration management is a means by which

identification and traceability are maintained.

7.5.4 Customer property

The organization shall exercise care with customer property while it is under the
organization’s control or being used by the organization. The organziation shall
identify, verify, protect and safeguard customer property provided for use or
incorporation into the product. If any customer property is lost, damaged or otherwise
found to be unsuitable for use, this shall be reported to the customer and records
maintained .(see 4.2.4)

NOTE Customer property can include intellectual property

7.5.5 Preservation of product

The organizations shall preserve the conformity of product during internal processing
and delivery to the intended destination. This preservation shall include identification,
handling. packaging, storage and protection. Preservation shall also apply to the
constituent parts of a product.

7.6 Control of monitoring and measuring devices

The organization shall determine the monitoring and measurement to be

undertaken and the monitoring and measuring devices needed to provide
evidence of conformity of product to determined requirements. .(see 7.2.1.)

The organization shall establish processes to ensure that monitoring and

measurement can be carried out and are carried out in a manner that is
consistent with the monitoring and measurement requirements.

Where necessary to ensure valid results, measuring equipment shall

a) be calibrated or verified at specified intervals, or prior to use, against
measurement standards traceable to international or national measurement
standards; where no such standards exist, the basis used for calibration or
verification shall be recorded;
b) be adjusted or re-adjusted as necessary;
c) be identified to enable calibration status to be determined,
d) be safeguarded from adjustments that would invalidate the measurement
result;
e) be protected from damage and deterioration during handling, maintenance
and storage

In addition, the organization shall assess and record the validity of the pervious
measuring results when the equipment is found not to conform to requirements. The
organization shall take appropriate action on the equipment and any product
affected. Records of the results of calibration and verification shall be maintained.
(see 4.2.4)

When used in the monitoring and measurement of specified requirements, the

ability of computer software to satisfy the intended application shall be confirmed.
This shall be undertaken prior to initial use and reconfirmed as necessary.

NOTE See ISO 10012-1 and ISO 10012-2 for guidance.

8 Measurement, analysis and improvement

8.1 General

The organization shall plan and implement the monitoring, measurement,

analysis and improvement processes needed

a) to demonstrate conformity of the product,

b) to ensure conformity of the quality management system and
c) to continually improve the effectiveness of the quality management system.

This shall include determination of applicable methods, including statistical

techniques, and the extent of their use.

8.2 Monitoring and measurement

8.2.1 Customer satisfaction

As one of the measurements of the performance of the quality management

system, the organization shall monitor information relating to customer
perception as to whether the organization has met customer requirements.
The methods for obtaining and using information shall be determined.

8.2.2 Internal audit

The organization shall conduct internal audits at planned intervals to

determine whether the quality management system
a) conforms to the planned arrangements(see 7.1), to the requirements of this
International Standard and to the quality management system requirements
established by the organization, and
b) is effectively implemented and maintained

An audit programme shall be planned, taking into consideration the status and
importance of the processes and areas to be audited, as well as the results of
previous audits. The audit criteria, scope, frequency and methods shall be defined.
Selection of auditors and conduct of audits shall ensure objectivity and impartiality of
the audit process. Auditors shall not audit their own work.

The responsibilities and requirements for planning and conducting audits, and
for reporting results and maintaining records (see 4.2.4) shall be defined in a
documented procedure.

The management responsible for the area being audited shall ensure that
actions are taken without undue delay to eliminate detected nonconformities and
their causes. Follow-up activities shall include the verification of the actions taken
and the reporting of verification results (see 8.5.2)

NOTE. See ISO 10011-1, ISO 10011-2 & ISO 10011-3 for guidance.

8.2.3 Monitoring and measurement of processes

The organization shall apply suitable methods for monitoring and, where
applicable, measurement of the quality management system processes. These
methods shall demonstrate the ability of the processes to achieve planned results.
When planned results are not achieved, correction and corrective action shall be
taken, as appropriate, to ensure conformity of the product.

8.2.4 Monitoring and measurement of product

The organization shall monitor and measure the characteristics of the product
to verify that product requirements have been met. This shall be carried out at
appropriate stages of the product realization process in accordance with the planned
arrangements (see 7.1).

Evidence of conformity with the acceptance criteria shall be maintained

Records shall indicate the person(s) authorizing release of product (see 4.2.4)

Product release and service delivery shall not proceed until the planned
arrangements ( see 7.1) have been satisfactorily completed, unless otherwise
approved by a relevant authority and, where applicable, by the customer.

8.3 Control of nonconforming product

The organization shall ensure that product which does not conform to product
requirements is identified and controlled to prevent its unintended use or delivery.
The controls and related responsibilities and authorities for dealing with
nonconforming product shall be defined in a documented procedure.
The organization shall deal with nonconforming product by one or more of the
following ways:

a) by taking action to eliminate the detected nonconformity;

b) by authorizing its use, release or acceptance under concession by a relevant
authority and, where applicable, by the customer;
c) by taking action to preclude its original intended use or application.

Records of the nature of nonconformities and any subsequent actions taken,

including concessions obtained, shall be maintained (see 4.2.4.)
When nonconforming product is corrected it shall be subject to re-verification
to demonstrate conformity to the requirements.

When nonconforming product is detected after delivery or use has started, the
organization shall take action appropriate to the effects, or potential effects, of the
nonconformity.

8.4 Analysis of data

The organization shall determine, collect and analyse appropriate data to

demonstrate the suitability and effectiveness of the quality management system and
to evaluate where continual improvement of the effectiveness of the quality
management system can be made. This shall include data generated as a result of
monitoring and measurement and from other relevant sources.

The analysis of data shall provide information relating to

a) customer satisfaction (see 8.2.1),

b) conformity to product requirements (see 7.2.1),
c) charactristics and trends of processes and products including opportunities for
preventive action, and
d) suppliers.

8.5 Improvement

8.5.1 continual improvement

The organization shall continually improve the effectiveness of the quality

management system through the use of the quality policy, quality objectives, audit
results, analysis of data, corrective and preventive actions and management review.

8.5.2 Corrective action

The organization shall take action to eliminate the cause of nonconformities in

order to prevent recurrence. Corrective action shall be appropriate to the effects of
the nonconformities encountered.

A documented procedure shall be established to define requirements for

a) reviewing nonconformities (including customer complaints),

b) determining the causes of nonconformities,
c) evaluating the need for action to ensure that nonconformities do not recur,
d) determining and implementing action needed,
e) records of the results of action taken (see 4.2.4), and
f) reviewing corrective action taken
8.5.3 Preventive action

The organization shall determine action to eliminate the causes of potential

nonconformities in order to prevent their occurrence. Preventive actions shall
be appropriate to the effects of the potential problems.

A documented procedure shall be established to define requirements for

determining potential nonconformities and their causes,

evaluating the need for action to prevent occurrence of nonconformities,
determining and implementing action needed,
records of results of action taken (see 4.2.4), and
reviewing preventive action taken.

&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
 Six Sigma

Six Sigma, as claimed by its proponents, is one of the most powerful management tool, ever
devised.

It was conceived by Motorola in 1982. latter it was successfully used by Poloroid, Allied
Signals, GE and a few more companies. Impressed and inspired by the success and the
financial results, these companies could achieve, it has soon become popular the world over.
Some companies in our country-like Wipro, have also adopted this novel technique.

Six Sigma is a business process that allows companies to improve their performance by.

(i) Reducing Waste and

(ii) Reducing resources and increasing customer satisfaction.

• It is achieved through designing and monitoring everyday business activities

right from order acceptance to manufacturing of, say, tanks or aero planes.
• It aims at eliminating quality lapses at the earliest possible occurrence.

Six Sigma is about change. Change in the way present business is conducted. It believes that
“Business quality is highest when cost is at the lowest both for the producer and the
customer”

It does not pursue quality for the purpose of quality only. In six sigma only those parameters
of a product or service, which affect the customer, are considered for improvement.

These parameters are known as C.T.Q’s. i.e ‘Critical to quality’ parameters. C.T.Q’s
depend upon the customer is, as we call, king now a days. Market is dictated as per his wish
and will. Customer decides about which characteristic of product are important. Only those
suppliers, who can fulfill customer’s need and expectations, can survive in the present
competitive market.

So, it is important for manufacturing, to develop and convert customers need and
expectations into technical specifications. QFD i.e. Quality function Deployment is a
technique used for this purpose. Let me clarify this point. Suppose we need to by a
passenger car. What will be needs of a customer – comfortable ride, easy and smooth
steering, fuel efficiency, efficient brakes, non polluting, economic, sturdy, elegant look etc.
we can not use this information in this form for manufacturing. Some of these requirements
are contradictory to each other. For example sturdy and fuel efficient. QFD is a technique
which develops customers need and expectations and simultaneously ensures that all the
customers’ requirements and expectations are considered right from design stage only. Any
feature of the product which does not add value to the customer is also identified and
removed from the design.

D.P.M.O
This term is popularly used in six sigma. Let’s understand it.

Six sigma applies to single C.T.Q and not to the total product. We have some
misconceptions here. Lets get it clarified.
When we describe a passenger car as six sigma, this does not mean that 3.4 cars out of a
million cars will be defective.
It means that in a single car, the average opportunity for defect of CTQ characteristics is only
3.4 defects per million opportunities.

Six Sigma cost of Quality

Lets have a comparison of Quality cost in a three sigma process vs. six sigma process. In a
Three sigma process, DPMO is = 67000 and cost of quality is 25 to 40% of sales value where
as in six sigma process, DPMO in 3.4 and COQ is less than 1% of sales. Six sigma is a
technique which makes inspection redundant. If you are ale to save even 20% on this
account, you can just imagine its impact on the product cost.

In out manufacturing organizations we normally use a very popular metric i.e yield. This
yield is the simple ratio of output to input. That means number of units passed in inspection
divided by number of units inspected. This yield does nor reveals many important viz. How
much of rework (extra cost) has been done. So while yield may sound to be very good even
99%, this does not tell about the actual level of the process. In six sigma following metrics
are used.

1. Through put yield: is the probability that all defect opportunities, produced at a particular
step in the process will conform to their respective performance standard.

2. Rolled Through put Yield : is the probability of an item being able to pass a unit of product
through the entire process steps defect free.

Variability

In six sigma, we aim to reduce variability of our processes. Variability is a common

phenomenon of nature. It is found in our manufacturing processes also. In fact when we talk
about quality control, we try to find out ways and means which can help us in reducing
variability of the manufacturing process. Reduced variability means better quality, lower
rejections, reduced rework, reduced scraps etc.

We have to identity factors, which are significantly contributing for variations, and
then these factors are controlled such that the spread of the process i.e. the process width is
reduced.
 When a level of process width, which is half of the specification width or popularly
known as design width is achieved, the process is called a six sigma process. In its true
shape, defectives, which can be produced by a process, will be 0.002 p.p.m.(parts per
million).

But in real world it does not happen so. Process center has always a tendency to shift
from its mean value. This shifting may be, as experience has taught us, to an extent of up to
1.5 sigma on either ode of the mean. Under these conditions defects which may be produced
will be 3.4 p.p.m.

Six Sigma Methodology

Six sigma is implemented in the form of projects. Projects are selected based on its
value. The value which it may offer to the customer in terms of reduced cost and better
performance and to the organization in terms of increased profits. After successful
completion of a project, gradually more projects are taken up to cover all operations and
processes. Six sigma has a very specific methodology and specific tools are used in its
different phases. The different phases of six sigma are discussed below.

Fundamental Steps

1. Define Phase: In this phase, project is defined in very clear terms. What the problem
is? Which team is going to implement six sigma, who will be the team members? What is the
time frame? Who will be responsible for providing the resources? What metrics shall be used
to measure the success of the project etc.

2. Measurement phase:- In the measurement phase we have to understand out existing

process level. The process width, process normality, standard deviation are measured and
established.
The most important part is measurement and establishing the process capability the common
index used are
(i). Potential Process Capability CP.
(ii). Real Process capability CPK.
(iii) . Instability index St.

Once the measurement phase is completed, we can go for the third phase. i.e.

3. The analysis phase: In this phase we have to find out the causes and the potential
causes that could affect the product quality and result in variations. We already know out
existing process level. We also know the desired level i.e. six sigma level so the gap between
desired and existing level can be identified.

Statistical tools help us in identification of key variables i.e. the variables which actually are
affecting the product parameters. Following tools are of great help in the phase.

(i). Ishikawa analysis or cause & Effect Diagram

(ii). Pareto analysis.
(iii). Failure Modes & Effect Analysis.

The first two tools are very simple and need no explanation here. Failure Modes & Effect
Analysis (FMEA) is a tool, employed for predicting possible failures of a product in advance.
This tool normally serves the following purposes.
(a) Identifies known or potential process failure modes
(b) Assesses the potential risk effects of the failure to internal and external customers
(c) Defects process variables that must be controlled to reduce similar failures.

(iv) Design of Experiments or The Taguchi Technique. It helps in identification of a

particular factor that is contributing significantly to variability in the process.

(v) Analysis of variance or the ANOVA: This technique is also used for identification of
factors which contribute towards variations in the process results.

(vi) Control Charts: These charts can tell us complete story. Charting the data in
important when analyzing the process for improvement. It is a means to maintain long-term
process control.

Control charts provide us a visual representation of how process varies overtime or

form unit to unit.

Control charts are of two types.

• Charts for mapping attribute.
• Charts for mapping variables.

Attribute charts include.

• Number of defects in a subgroup.
• Fractional defects in a subgroup.
• Number of defects per subgroup.

Variable charts include.

• Average charts.
• Range charts.
• Standard deviation charts &
• Moving Average charts.

Nowadays software for these charts are available making the job very simple.

4. The next step is improvement phase:

In this phase we have to establish operating tolerances on each of vital

variables. Once the critical inputs influencing the process in terms of variability are
identified, we have to control these inputs to such an extent that process capability is
improved and becomes half of the specification i.e. the six sigma quality. Tools like Design
of Experiment again help is in this phase. With the help of DOE we can find out the
optimum level of these tolerances. So in very simple terms we improve our processes by
modifying inputs. Remember, the processes are improved for the CTQ’s only.

5. Control Phase:

Once the processes have been improved, we must implement measures that will
control the key variables within their operating limit, over time. Generally most of the
organizations are conversant with common SQC and SPC tools, which are good methods for
controlling the processes. But we have to be careful not to confuse with simple monitoring,
which is achieved by these tools. Besides monitoring our purpose is to control which can be
achieved by analyzing and acting on the results.

In six sigma we need to become proactive i.e. acting before the process goes statistically
out of control and starts production of defectives.

6. Standardization Phase: In this phase, we need to standardize the methods and

processes that produce best-in-class products and services. Once the business has uncovered
a best in class management practice, it should seek to standardize it and transfer the
knowledge to all relevant functionaries in the operation. For example there may be 10
different way for accomplishing a job effectively but not necessarily efficiently.
After measuring these different methods we have to select vital few methods having
high capability and optimize these and then standardize these.

Six Sigma Training

In six sigma, an together different approach for training is recommended. Training

programmes are about three month duration. The participants are trained so that they can
select and use various statistical tools efficiently and effectively.

Training programmes are recommended to be in house. Participants are assigned with

a project. They learn about various phase in the class rooms then they go back to the work
place and implement the knowledge gained in progressing their project. After completing
this cycle, they again return to class room for study of next phase and so on.

So, by the time the training programme is completed, the participants actually
complete a six sigma project also. The participants now have a very high level of confidence
to handle next project.

Six Sigma Roles

In six sigma each and every employee has a role to play. Success of any organization
depends largely on its people, their knowledge and their attitude.

In six sigma, the entire organization is required to be trained is related techniques.

Experience of Motorola, GE and others suggest for creation of following specific roles
1. Champions:
2. Black Belts:
3. Green Belts:
Champions are senior black belts, working as mentors organizing training programmes,
providing necessary resources for developing a network of six sigma personnel in the
organization.
Black Belts:

These are the project leaders. They have very sound knowledge of the business and
the manufacturing. They are highly efficient is using statistical and other techniques needed
in a six sigma project. This is a full time position. The Black Belts are expected to complete
four to six projects in a year.

Green Belts:

This is a part time role i.e these persons work for six sigma projects in addition to
their other responsibilities in the organization by getting associated with a project, they get an
opportunity to learn and apply six sigma tools and techniques.

TOTAL PRODUCTIVE MAINTENANCE.

MAINTENANCE:
It can be defined as those activities required to keep the facility in as-built condition,
so that it continues to have its original productive capacity.
 The responsibility of the maintenance function is to ensure that production plant and
equipment is available for productive use at minimum cost , for the scheduled hours,
operating at agreed standards with minimum waste.
Maintenance system can be classified under the following heads;
1. Breakdown
2. Routine
3. Planned
4. Preventive
5. Predictive
6. Corrective
7. Design Out Maintenance ( DOM)
8. Total Productive Maintenance
9. Contracted Out Maintenance.

Modern equipment management began with Preventive Maintenance and evolved

into Productive Maintenance. These approaches – both abbreviated as PM originated in US
with activities focused in maintenance departments.

Productive Maintenance:
Maintaining the equipment that supports production is an important component of any
approach to plant maintenance. The goal of productive maintenance is ‘ profitable PM’. This
required us not only to prevent breakdown and defects, but to do so in ways that are efficient
and economical. To achieve this goal we need to master four techniques:

@ Breakdown Maintenance- repairing after breakdowns occur.

@ Preventive Maintenance - preventing breakdowns.
@ Corrective Maintenance- improving or modifying equipment to prevent
breakdowns or to make maintenance easier.
@ Maintenance Prevention - designing and installing equipment that needs
little or no maintenance.
Breakdown Maintenance:
Breakdown maintenance is the repair of equipment after a breakdown or deterioration
in performance.
There are two kinds of breakdown maintenance.
Planned repairs – are carried out when it is more economical to deal with a problem
after the machine has failed than to prevent failure.
Unplanned repairs- involves failures would have been better to prevent. This kind of
repair puts the production schedule at risk and is often carried out in panic.

Preventive Maintenance:
Sustaining smooth production means avoiding equipment breakdowns and defects.
We need to install suitable equipment in the first place and to keep it functioning properly .
This , in turn, requires three types of activities.;

@ Daily maintenance ( cleaning, checking, lubricating and tightening) to prevent

deterioration.
@ Periodic inspection or equipment diagnoses to measurement deterioration.
@ Restoration to correct and recover from deterioration.
Corrective Maintenance:
Corrective Maintenance is the name given to improvements that :
@ Keep equipment from breaking down.
@ Facilitate inspection, repair and use.
@ Ensure safety.
Corrective maintenance requires the people who us e equipment to do two things;
1. Record the results of daily inspection and the details of all breakdowns.
2. Actively submit improvement ideas aimed at preventing breakdown and the
conditions that cause them.
Based on these breakdown records and improvements ideas, maintenance specialists
and equipment designers study recurring problems and improve or modify machines
to make them less likely to break down , easy to maintain and safe.

Maintenance Prevention:
Maintenance prevention incorporates the ideas developed in the course of productive
maintenance in the design of new equipment. It means designing or specifying equipment
that doesn’t break down and is easy to maintain: equipment that is reliable and maintainable.
Maintenance prevention requires us to study maintenance data and to develop
“maintenance free” design for equipment that doesn’t breakdown( or, if it does , can be
repaired easily) and that is easy to use, safe, and inexpensive.
To achieve this, operators and maintenance people need to record maintenance related
information about equipment currently in use in a form that will be helpful to the people who
design equipment.

WHAT KIND OF WORKPLACE SUFFERS FROM DEFECTS AND

EQUIPMENT BREAKDOWNS ?

Workplace plagued by numerous defects and breakdown have several features in

common.
1. The equipment is filthy and stays that way.
2. Oil and lubricant leaks are common and lubricators are empty.
3. Rotating parts and moving surfaces are encrusted with chips and raw materials.
4. Wires and hoses are tangled and you can’t tell what is connected where.
5. Equipment mechanisms are hidden by big covers and you can’t see inside.
6. Materials, parts, tools, and supplies are strewn randomly and you can tell what is
essential and what is not.
7. Everyone is utterly convinced that things have to be that way.

DEFINITION OF TPM:
The standard definition of TPM is given below.
1. The goal of the TPM is to build a robust enterprise by maximizing production
system efficiency( overall effectiveness).
2. TPM addresses the entire production system life cycle and builds a concrete, shop
floor- based system to prevent all losses. Its aim include the elimination of all
accidents, defects, and breakdowns.
3. TPM involves all departments , from production to development, sales and
administration.
4. Everyone participates in TPM , from top executives to shop floor employees.
5. TPM achieves zero losses through overlapping team activities.
This is achieved by:
1. Setting the goal of maximizing equipment effectiveness.
2. Establishing a total PM system focusing on the entire equipment life cycle.
3. Coordinating all departments, including those that design, maintain and use
equipment.
4. Involving everyone, from top executives to shop floor employees.
5. Managing through team based activities aimed at plant wide goals of zero losses.

Why do TPM?
As equipment becomes more automated and sophisticated, it is no exaggeration to say
that machine make the product. The role of people , then, is to maintain machines so that
they work properly with no breakdowns and no defects.
But this can’t happen when only maintenance specialists are involved as in the past.
Total productive maintenance requires the participation of equipment users and
equipment and product designers. It is especially important for users (operators) to take
an active role in caring for their own equipment to prevent breakdowns and defects.
What makes TPM different ?
TPM takes the idea of productive maintenance or profitable PM one step further. It
moves beyond traditional maintenance activities and involves all departments and
employees in equipment management.
Perhaps the most distinctive aspect of TPM is autonomous maintenance. Carried
out by production floor employees , autonomous maintenance activities help the people
take care of their own machines.
Another feature of TPM is that it aims at the total elimination of all losses, or zero
losses. The instances on total elimination is a key factor in maximizing overall
equipment effectiveness (OEE).

EIGHT KEY STRATEGIES OF TPM DEVELOPMENT:

Achieving the goal of TPM requires activities in eight key areas.
1. Focused improvement (kaizen) to make equipment more efficient.
2. Autonomous maintenance activities .
3. Planned maintenance for the maintenance department
4. Technical training in equipment maintenance and operation.
5. An early equipment management program
6. Quality maintenance activities.
7. A system for increasing the efficiency of administrative and support functions ( office
TPM).
8. A System for management of safety and environmental issues.

Six big losses that lower equipment efficiency

People use machines to produce goods. When equipment doesn’t work the way we
want , productivity slumps and we end up struggling with overtime or weekend work.
Equipment problems drain productivity in six ways, called the six big loses.
1. Breakdowns
2. Setup and adjustment loss
3. Idling and minor stoppages
4. Reduced speed
5. Defects and rework
6. Startup and yield loss
 Dr. Ajay Tyagi
Director/OFIL

Introduction to ISO-9001 : 2000 and Guidelines for Applicants

IS/ISO-9001:2000.

ISO ( International Organization for Standardization ) is a worldwide federation of

national standards bodies, at present comprising 140 members, one in each country . The
object of ISO is to promote the development of standardization and related activities in the
world with a view to facilitating international exchange of goods and services, and to
developing cooperation in the spheres of intellectual, scientific, technological and economic
activity. The results of ISO technical work are published as International Standards.

The ISO 9000 family of standards represents an international consensus on good

management practices with the aim of ensuring that the organization can time and time
again deliver the product or services that meet the client’s quality requirements. These good
practices have been distilled into a set of standardized requirements for a quality
management system, regardless of what your organization does, its size, or whether it is in
the private, or public sector. The family of ISO-9000 standards have been developed by ISO
and it is made up of four core standards :

a) ISO 9000:2000 - Fundamentals and Vocabulary

b) ISO-9001:2000 - Quality Management Systems - Requirements
c) ISO-9004:2000 - Quality Management Systems - Guidelines for performance
improvements
d) ISO-19011:2002 - Guidelines for quality and /or environmental management systems
auditing.

BIS is the National Standard Body of India and is a founder member of ISO. BIS
represents India, in ISO. The Technical Committee (TC) number 176 (ISO/TC 176), and its
Sub-committees of ISO are responsible for the development of ISO-9000 Standards.
Quality and industry experts from India including BIS officers nominated by BIS participate
in the meetings of the Technical Committee ISO/TC 176 and its Sub-committees.
BIS has adopted the above mentioned ISO-9000 standards and these are numbered as IS/ISO
9000:2000; IS/ISO 9001:2000;IS/ISO 9004:2000; and IS/ISO 10011:2002. These standards
published by BIS are exact replica of ISO 9000 standards. BIS also provides certification
against IS/ISO :2000 under its Management Systems Certification activity.

Any organization can apply for certification against IS/ISO 9001:2000. The other
standards i.e. IS/ISO 9000:2000; IS/ISO 9004:2000; and IS/ISO 19011:2002 are guidance
standards and are not meant for certification.
 The requirements of IS/ISO 9004:2000 should be implemented by the organization
who intend to further improve beyond the requirements of IS/ISO 9001:2000. The standard
IS/ISO 9004:2000 has an important element of `self-evaluation’ and this standard is not
amenable to certification.

The IS/ISO 9000 standards are applicable to all types of organizations. The definition
of the term `product’ in IS/ISO 9000:2000 also include services and their combination.
Therefore, the requirements of IS/ISO 9001:2000 are equally applicable to service sector as
it is applicable to product manufacturing company.

As a minimum you should familiarize yourself not only with the requirements of
IS/ISO 9001:2000 but also with the content and philosophies given in IS/ISO 9000:2000,
IS/ISO 9004:2000 and the Quality Management Principles. You have to clearly understand
your organization’s activities and processes and appropriately interpret the requirements of
the standards. Implement the requirements in the various activities and processes adding
value to these processes and activities. For training programme on general awareness on the
requirements, content and philosophies of the standards, or BIS , National Institute of
Training for Standardization (NITS) may be contacted.

Main benefits of implementing IS/ISO 9001:2000 Quality Management System

Requirements

Provides an opportunity to increase value to the activities of the organization.

Improve the performance of processes/activities continually.

Satisfaction of customers.
Attention to resource management

Implementation of statutory and regulatory requirements related to product/services

Better management control.

The difference between a certification body and a registration body is

none. The term `certification body’ is used in some countries, like, India, because BIS as
certification body issue certificates (licences). Elsewhere, they prefer to say that they
`register’ organizations complying with ISO 9000.

In simple terms, accreditation is like certification of the certification body.

`Accreditation’ should not be used as an interchangeable alternative for certification or
registration. BIS Quality Management Systems Certification activity has been accredited by
Raad voor Accreditatie (RvA) of Netherlands, to carry out IS/ISO 9001:2000 certification in
23 business sectors.

To obtain IS/ISO 9001:2000 Certification. The information is available in BIS

website under Management Systems Certification. The application form (Form IV),
questionnaire (Form V) and fee structure can also be downloaded from BIS website. A copy
of the `Guidelines for Applicants - IS/ISO 9001:2000 can be obtained from Regional or
Branch Offices of BIS or from Headquarters at New Delhi.
 The ISO : 9000 series of Quality Systems Standards brought out in 1987, revised in
1994 and again revised in 2000 by International Organization for Standardization (ISO)
have made a dramatic impact on business around the world. The Technical committee
ISO/TC 176 is responsible for formulation of ISO-9000 series of International Standards.
BIS, the national Standards Body of India, represents India as participating member on this
committee. As the national focal point, BIS, through its Quality Management Sectional
Technical Committee MSD 2, liaises with ISO/TC 176. BIS is this fully abreast with the
latest developments in the field of Quality Management Systems and keeps the industry and
service sector informed of any developments.

The Quality Management System Certification Scheme of BIS was launched in

September 1991 under the provisions of the Bureau of Indian Standards Act, 1986. The
operation of the scheme entails initial assessment and subsequent surveillance of the Quality
Management System installed and implemented by the organization for verification of its
conformity to the prescribed requirements of the quality management systems standards.

BIS Quality Manual and procedures for certification of Quality Management

Systems are in line with internationally accepted criteria. Accreditation of BIS QMSCS by
Raadvoor Accreditatie (RvA), Netherlands, is a testimony of BISQMSCS Operating to
internationally accepted criteria.

Types of Quality Management Systems.

1) IS/ISO 9001 : 2000

2) IS/ISO 14001 : 1996

The operation of the scheme comprises pre- audit, certification

Audit and subsequent surveillance of the Environmental Management System (EMS)
established and implemented by an organization as per requirements prescribed in IS /ISO
14001.

3) HACCP (Hazard Analysis and Critical Control Point) is a process control system for
food safely designed to identify and present microbial and other hazards in food production.
It includes steps designed to prevent problems before they occur and to correct deviations as
soon as they are detected. (IS 15000:1998). It is called Food Safety Management System
Certification.

4) Occupational health and Safety Management Systems.(IS 18001:2000) (OH &S).

Health and safety are important aspects of an organization’s smooth and effective
functioning. Good health and safety performance ensure an accident - free industrial
environment. Process of Quality Management Systems Certification.
1) Applicant :

Firms interested in obtaining license for quality management systems as per the
IS/ISO 9001 : 2000 should ensure that they are operating quality management system in
accordance with the requirements of the standard. They should apply on the prescribed
proforma in triplicate (Form IV & Form v) at the concerned Regional Office of BIS
alongwith prescribed application fee as applicable. The application fee is non-refundable. The
application from IV is to be signed by the proprietor, partner or the chief Executive officer
(CEO) of the firm or any other person authorized to sign any declaration on behalf of the
firm. The name and designation of the person signing the application must be recorded
legibly in a space set apart for the purpose in the application form. Each application must be
accompanied by a supplementary questionnaire (Form V) duly filled in along with the
documented quality management system (such as quality manual, quality plan, etc.) prepared
by the firm. The documented quality management system shall be in the line with the
requirements of the standard. The questionnaire (Form V) is to be signed by the proprietor,
partner of the chief executive officer of the firm or any other person Authorized to sign any
declaration or behalf of the firm. The name and designation of the person signing the
application must be recorded legibly in a space set apart form the purpose in the
questionnaire.

If necessary, BIS shall provide to the applicant further information about the scheme
and also ask for further information from the applicant. BIS reserves the right to reject an
application which is incomplete and does not fulfill one or more of following requirements.
However, ample opportunity and information will be provided to applicant to fulfill the
requirements.

i) Application fee not accompanying the application.

ii) Application form is incomplete.

iii) Annexures to the application are not clear the reason for rejection of the application
shall be communicated to the applicant by BIS.

BIS will acknowledge the receipt of the application and application fee. Every
application will be given a serial number to be known as “Application Number”. In all future
correspondence, reference must be made to the “Application Number”. For IS/ISO
9001:2000 - Application fee (to be paid along with application) shall be Rs. 15,000/-

Concession in application fee can be given to a unit already certified for any
management system by BIS - application fee shall be Rs. 10,000/-. The following
organizations of Government on Public Sector, Training Institutes and Health Core
Establishments - Application Fee shall be Rs. 10,000/-

Adequacy Audit :

After the application has been accepted the documented quality management
system (Quality Manual/Quality Plan, etc. ) shall be examined by the IS for verifying the
conformance to the standard. Any significant omissions or deviations from the prescribed
requirements intimated by BIS will have to be corrected by the applicant and BIS to be
informed accordingly to process the application further.

Preliminary visit :

BIS Official(s) will make a visit to the premises of the applicant to acquaint himself /
themselves of the size, nature of the operation and firm’s readiness for the audit. The visit
will also be utilized to assess the number of auditors for the initial audit for grant of licenses,
its duration and type of expertise required. The number of the auditors for audit and its
duration will vary according to the size and nature of operation of the firm being assessed.
Any significant omissions or deviations from the prescribed requirements intimated by BIS
will have to be corrected by the applicant and BIS to be informed accordingly to process the
application further. The application fee includes the adequacy audit of documented quality
management system and preliminary visit for . However, expenses for travel and stay of
auditor(s) for preliminary visit will be charged at cost.

Assessment Fee :

Assessment fee will be payable in advance, estimate of which will be provided by

BIS, depending upon the man-days expected to be spent on the audit of the firm and the
anticipated expenses for travel and / or stay, etc. as applicable will also be intimated.

Assessment fee (initial certification audit) and reassessment for (Renewal Audit).

Rs. 3,000/- per auditor(s) per day towards assessment/re-assessment fee plus expenses
for travel and stay of auditors which will be charged at cost assessment/re-assessment fee
and estimated expenses to be paid in advance before the audit). Normally
assessment/reassessment time would be six to nine mandays ( for example three auditors for
two /three days). However, this is flexible and would depend upon the quality management
system installed and the size and nature of operation of the company.

License Fee :

For IS/ISO 9001 : 2000, the license fee for a period of three years shall be Rs.
60,000/- to be paid at the time of grant /renewal of license before license document is
handed over to license.

Concession in fee to training institutes (Govt. /State Govt. /Public Sector) Libraries,
Laboratories, Schools, Colleges, Polytechnics, Health care establishments shall be Rs.
40,000/-

Surveillance Audits fee :

At least 3 Surveillance audits will be undertaken in three years. Charges for

surveillance audits towards man days spent, shall be Rs. 3000/- per man day plus expenses
for travel and stay of auditors which will be charged at cost (Surveillance audit fee and
estimated travel and stay expenses to be paid in advance before the audit.

Special visit fee :

Any other audit (follow-up-audit) or special visit will be charged at Rs. 3000/- per
auditor per day towards fee plus expenses for travel and stay of auditors which will be
charged at cost. Fees and concession are subject to review periodically.
Assessment (Initial / Certification Audit)

An Audit Team from BIS will visit the firm for assessment of the firm’s
compliance to the requirements of IS/ISO 9001:2000 and processes, procedures and activities
enumerated in the documented quality management system or as established.

The Assessment will comprise the following sequence :

a) Opening Meeting - This meeting will be conducted by the leader of the audit team in
which the Chief Executive Officer (CEO) of the company, the management representative
and heads of all the departments being audited are expected to be present. The purpose of an
opening meeting is to confirm the audit plan; provide a short summary or how the audit
activities will be undertaken; confirm communication channels; and to provide an
opportunity for the auditee to ask questions.

b) Conduct of Assessment - Each auditor may be accompanied by a guide who is

conversant with the activities of the department(s) the auditor is auditing. Observations
recorded by the auditors must be signed by the guide as a token of acceptance, is desired by
the auditor.

The non-conformities observed by the audit team will be handed over to the firm at
the end of each day for necessary correction and corrective actions.
Time frame for the corrective action(s) will be decided by the firm.
The non-conformity reports will be signed by Management Representative or
authorized signatory as a token of acceptance.

c) Closing Meeting.
All the members present in the opening meeting should preferably be present in the
closing meeting as well, when the audit team will present their findings to the firm.
The audit team leader will present the audit findings and conclusions during the
closing meeting. A report will be submitted to the firm by the audit team leader.

Responsibilities of applicant during the audit.

The firm is expected to provide following assistance to the audit team during the
audits :
a) Arrangements of stay, local guidance and travel arrangements, etc.

b) The CEO and the Management Representative of the company must be present during
the opening and closing meetings. As far as possible, all responsible personnel of the
company whose departments are being audited should be present in these meetings.

c) In the interest of the firm, all efforts should be made that time of the audit team is not
wasted on account of non-availability of relevant personnel, documents, records, shut down
of unit(s) being audited, etc.

d) The firm will arrange a place / room where members of the audit team can meet to
exchange their notes and findings and discuss during the day and at the end of the day.
 Before grant of licence to the organization be considered, corrections/corrective
actions taken by the organization on the non conformities observed during the audit will
have to be verified by BIS. This may be verified during the audit or call for a follow up
audit, full or partial, as the case may be. When the competent authority of BIS is satisfied
with the recommendations of the assessment team for grant of licence, the same shall be
granted.

At the time of grant of licence to the applicant, they shall give the following
undertaking. “We shall make no claim direct or implied that the licence granted to us relates
to products or processes other than those set out in the said licence and the schedule
thereof.”

Grant of License.

The licence shall be granted for a period of three years.

Grant of licence will be followed by at least three surveillance visits in three years by the
auditor(s) nominated by BIS to verify the effective implementation and maintenance of the
quality management system established by the firm.
During the operation of licence, when a licensee fails to observe the conditions of the Quality
Management Systems Certification Scheme or where there have been significant changes in
the organization of the licensee, licence of the firm is liable to be suspended and may call for
special visits for which firm is liable to pay special visit charges as set out in schedule of
fees.

Renewal , expiry , suspension and cancellation of License.

Any licence granted automatically expires at the end of the period for which it is
granted. A renewal notice will be issued to the licensee by the concerned regional office of
BIS about three months before the expiry of the current operative period. The licensee is
required to submit the renewal application atleast three months in advance before the expiry
of the licence which will be followed by a complete audit of quality management system of
the firm.
If some discrepancies are found during the audit, the licensee will be asked to take
actions(correction and corrective actions). After the licensee has taken necessary action or a
corrective and preventive action plan is proposed by the licensee to remove discrepancies, the
Quality Management Systems Certification licence will be renewed for a period of three
years.(For suspension and cancellation of licence, please see Obligations of Licensee.

Obligation of licensee.

A licensee on grant of certification for quality management system will :

a) At all times comply with the requirements of the licence as set out therein and
comply with BIS (Certification) Amendment Regulations, 2002 or any amendments
thereto.
b) Only claim that he is holding a license in respect of the capability which is the
subject of the licence and which relates to the products, processes or systems in
accordance with the licence requirements.
c) Not use the licence in any manner to which the BIS may object and shall not make
any statement concerning the authority of the licensee’s use of the licence which, in
the opinion of the BIS, may be misleading.
d) Submit to the BIS for approval the form in which he proposes to use the licence or
proposes to make references to the licence.
e) Upon expiry of its period of validity, suspension or termination of the licence,
however, determined, discontinue its use forthwith and withdraw all promotional and
advertising matter which contains any reference thereto.
f) Not make any change in the Quality Management System which forms the basis for
the grant or renewal of the licence and which prevents its compliance with the
scheme without prior approval of the BIS.

g) Submit to the BIS any amendments to the approved documented system.

h) Document all changes made to the Quality Management System and make records of
such changes available to Bureau’s designated officers on request. A change in key
personnel in relation to management of the licenced systems and technological
functions or senior management shall be notified to the BIS by the licensee.

i) Permit access to a team appointed by the BIS for purposes of assessment, audit or
surveillance. The licensee shall give full details of all actions taken in response to
field problems arising from allegations of defects in products, processes or systems
covered in the licence and allow BIS officers access to all relevant records and
documents for the purpose or verifying such details.

j) Be required to produce evidence of continuing operations for the products, processes

or systems covered by the licence. Licensee shall notify to BIS in writing of
discontinuance in such operations exceeding three months. Discontinuance of a
licence in excess of six months or more may lead to cancellation of the licence. In
such cases, a fresh application shall be submitted to the Bureau and assessment visit
will be necessary prior to grant of a new licence.

Pay all financial dues to the Bureau, in the manner specified by it, even for the
period of discontinuance of suspension of licence.
Operate and maintain procedures for handling and recording of complaints and shall report
any complaints against the quality management system operated and or licence, to BIS.
Cooperate and assist BIS on the investigation and resolution of such complaints.

Operate within the provisions of he BIS Act 1986; Rules, 1987; BIS (Certification)
Amendment Regulations, 2002 and Certification Scheme Procedure for grant of licence.

Privileges of licensee.

The privileges enjoyed by BIS licensees include:

a) Original Quality Management System Certification licence which can be
demonstrated by the licensees to anyone concerned. If need be, it can be photocopied &
displayed at various locations.

b) Use of Quality Management Systems Certification Mark on letter head in

advertisements, brochures, complimentaries and for other promotional purposes. However,
Standard Mark shall not be directly applied on the product and its packaging so as to avoid
the impression that product itself is certified by BIS.

c) Each licence shall be listed in the register of licensees maintained by BIS.

Appeals.

Under the Provisions of BIS Act 1986, any decision taken in respect of granting,
withholding, renewal, suspension or cancellation of certification under the Bureau of Indian
Standards Quality Management Systems Certification Scheme (BIS QMSCS) can be
appealed against. For the Procedure and Guidelines for making an appeal, contact Head
(Management Systems Certification ) at BIS Headquareter, 9 Bahadur Shah Zafar Marg,
New Delhi – 110002.

Quality Systems certification by Bureau of Indian Standards.

Quality Systems Certification by Bureau of Indian Standards.

Benefits to the certified firms.

The firm with BIS Quality Systems Certification licence provides :

i) Clear indication of its capabilities.

ii) Strong evidence of its commitment to quality.
iii) Assurance of consistence in quality of product /service with timely delivery
Disruptions to routine caused due to multiple assessment by various customer are reduced.

Firm is forced by itself – self motivated to consider improvement to the system through
regular audits by BIS.

Reduces the incidence of product failure, in turn improves credibility of the firm.

Leads to less material wastage, production down time, rework, etc. through an increase
quality know-how and efficiency.

Being internationally recognized, the firm’s quality will have world – wide acceptance.

Better choice and monitoring of the firm’s supplies.

Puts all operations on a scientific basis.

Motivates all employees and ensures their involvement.

Provides stepping stone to TQM.

Benefits to Customers.

Provides assurance and satisfaction that their needs for quality will be met.

Saves time and money by reducing the need for assessment of their suppliers.
Reduces incoming inspection costs.
Work with reduced inventory levels, effecting significant cost reductions.
Simplifies purchase decisions.
Creates confidence in their suppliers because of the approval by an independ third party.
Better service, better and quick complaint redressal
.
Reference :

1. IS / ISO 9001 : 2000 STANDARD.

2. IS / ISO 9004 : 2000 STANDARD

3. IS / ISO 90011 : 2002 STANDARD

4. QUALITY MANAGEMENT SYSTEM AUDIT, AUTHOR : SHRI Y.K. GAUR.

5. INDUSTRIAL SAFETY CHRONICLE. VOL. NO. XXXVI OCT. DEC. 20005 NO.3

6. BIS AND ISO-9001 : 2000 (BUREAU OF INDIAN STANDARDS, NEW DELHI).

7. INTEGRATED MANAGEMENT SYSTEMS CERTIFICATION BIS, NEW DELHI.

8. GUIDELINES FOR APPLICANT - IS/ISO 9001:2000 BIS, NEW DELHI.

CIVIL TRADE IN ORDNANCE FACTORIES.

Guide to Civil Trade :-

Definition of Civil Trade : The expression “Civil Trade” means sale of O.F.
Products to non-military Govt. Deptts. State Govts. Public Sector undertaking, public bodies
such as Corporations, Municipalities, Educational Institutions ect,. and Private Firms and
individuals. Payment issues to Defence Units such as Navy, Air Force, E-in-C etc. and to
factory employees do not figure within the scope of “Civil Trade”.

2. Capacity utilization for Civil Trade :-

Capacities created in OF’s are intended to meet the requirement of the Services both
in war and peace. Capacity in the factories is planned having regard to War Wastage
Reserve, and training requirement of the Services during war. Capacity actually sanctioned is
generally short of what would be the requirement to meet the above demands of the Services
in full during war. Civil Trade is to be undertaken only after meeting the current Service
demands in full. However, even during war, in case of in-sufficient demand of a particular
store from services or non-availability of raw materials and if the existing-plant can
accommodate the alternative load to balance the capacity in full, Civil Trade orders can be
executed provided the ultimate use for such store is for Defence purposes”. Thus, the pre-
requisite for Civil trade activity in the Ordnance Fys. is availability of spare capacity. Such
spare capacity cannot be expected to be available during war. The position is different during
peace time, since demands of the Services during war and peace very widely once the War
Wastage Reserves are filled up the O.Fs. can expect recurring demands from the Service to
meet what the Services would require for training only. Thus availability of spare capacity in
O.Fs. in peace time inherent in the capacity planning of O.F.s and the fluctuating nature of
service demands.

3. Important of Civil Trade Activities in the economy of O.Fs:-

Under utilization of capacity vitiates the economy of any production unit since in such
circumstances they are compelled to carry not only the idle machines but also the idle man-
power leading to disproportionate increase in overheads. Harnessing of such idle capacity to
production of items which are in demand in civil trade will not only improve the economy of
O.Fs from the point of view of cost-effectiveness but also in man-power management and
consequently, in maintaining good industrial relation; in addition the additional output will be
welcome contribution to the overall productivity.

MARKETING

Introduction :

Marketing is an important economic activity in the organization of a business unit.

More production of goods cannot be a successful one unless there is a proper marketing
system. Marketing involves the procedure adopted in making the products available to the
consumers. Selling is different from marketing. Selling refers to the form of activity where
ownership of good is transferred from the seller to the buyer.

Difference between selling and Marketing.

Sl.No. Selling Marketing

01 Emphasis on the product Emphasis is on consumer’s wants
Company first makes the product and Company first determines what the
then figures out how to sell it consumers want and then the firm
02
profitably figures out how to profitably make and
deliver a product to satisfy those wants.
03 Internal Company Orientation External Market Orientation
04 Emphasizes Company (sellers) needs Emphasizes market (buyers) needs

Market :
 The term market has different meanings and used differently in different places. The
common use of the terms are following.

a. A place where the market is held.

b. An assembly of people - buyers & Sellers.
c. An area of operation
d. An organization which facilitates exchange of commodities.
e. An act of buying and selling
f. A course of commercial activity.

Marketing :

“Marketing is getting the right goods or services to the right people at the
right place at the right time at the right price using the right promotion techniques “.

Marketing is : A system of business activities.

Designed to : Plan price, promote and distribute
Something of value : Satisfying goods and services
To the benefit of : The market present and potential household
consumers of industrial units.

The marketing is a management process with two aims. Firstly to achieve its own
aims and secondly to serve the society by satisfying wants of people.

The term marketing is recent origin. It has wider meaning. It should not be
misunderstood as selling, merchandising of distribution. The following will serve you to
know the difference in the meaning.

Selling is one part of promotion and promotion is one part of total marketing
programme.

Merchandising - It is product planning the internal company planning to get the right
product service to the market at the right time and at the right place and in the right colours
and sizes.

Distribution - It is market coverage - the retailing and wholesaling structure - the channels
used to get the product to its market.

Physical Distribution - It is materials - flow activities such as transportation, warehousing

and inventory control.

Marketing - It is the comprehensive concept. The others and referring to only one part one
activity - in the total marketing system.

Marketing has developed involving division of labour, factory industrialization and

urbanization of the population. Trade is the heart of marketing. Marketing is concerned with
handling and transportation of goods from the point of production to the point of
consumption it is concerned with the creation of four utilities namely, form , places, time and
possession utilities.
 Form - Development of product
Place - Transportation to the places needed.
Time - Goods made available at the right time needed.
Possession - For transfer of ownership of goods.

Importance of Marketing.

1. Efficient marketing devices reduce cost of distribution and in turn

goods can be sold at lower prices to consumers.

2. It brings new varieties of useful and quality goods to consumers.

3. It provides wide employment opportunities.
4. It has converted yesterday’s luxuries into today’s necessaries.