Session 17,18, Quality Management

Quality Management
By
Prof Alok Kumar Singh
A.K.SINGH, IMI, NEW DELHI
Defining Quality
Perfection
Fast Delivery
Consistency
Avoiding Wastage
Doing it right the first time
Delighting or pleasing customers
Providing a good, usable product
Total customer service and satisfaction
Compliance with policies and procedures
Different Views
User-based: better
performance, more features
Manufacturing-based:
conformance to standards,
making it right the first time
Product-based: specific and
measurable attributes of the
product
Key Dimensions of Quality
Performance
Features
Reliability
Conformance
Durability
Serviceability
Aesthetics
Perceived quality
Value
Costs of Quality
Prevention costs - reducing the
potential for defects
Appraisal costs - evaluating
products, parts, and services
Internal failure - producing
defective parts or service before
delivery
External costs - defects discovered
after delivery
Costs of Quality
Total
Cost
Total Cost
External Failure
Internal Failure
Prevention
Appraisal
Quality Improvement
Total Quality Management
Encompasses entire organization from

supplier to customer
Stresses a commitment by management
to have a continuing companywide drive
toward excellence in all aspects of
products and services that are important
to the customer
Seven Concepts of TQM

1.
2.
3.
4.
5.
6.
7.
Continuous improvement
Six Sigma
Employee empowerment
Benchmarking
Just-in-time (JIT)
Taguchi concepts
Knowledge of TQM tools
Shewharts PDCA Model
4. Act
Implement
the plan,
document
3. Check
Is the plan
working?
1. Plan
Identify the
pattern and
make a plan
2. Do
Test the
plan
When and Where to

Inspect
1. At the suppliers plant while the supplier
is producing
2. At your facility upon receipt of goods
from the supplier
3. Before costly or irreversible processes
4. During the step-by-step production
process
5. When production or service is complete
6. Before delivery to your customer
7. At the point of customer contact
Example of Quality
Today when one reads or hears about the transformation
of Japan during the last three decades from being a
cheap product seller to being the leader in quality, one
notes that the role of QC Circles is an integral part of its
journey towards excellence. This chapter describes a
series of events that led to the birth of QC Circles
brought about by the need of Japanese industries
immediately after the Second World War, to improve the
quality of their products so they could compete in the
international market. This chapter also describes how the
QC Circle concept spread to the neighbouring Asian
countries and the United States.
TQM Tools
The seven major tools are
Tools for Generating Ideas
Check Sheet
Scatter Diagram
Cause and Effect Diagram ( Fishbone Diagram)
Tools to Organize the Data

Pareto Chart
Flow chart
Tools for Identifying Problems

Control Chart
Histogram
Seven Tools of TQM

(a) Check Sheet: An organized
method of recording data
Hour
Defect
A
B
C
///
//
//
///
//
///
//
////
Seven Tools of TQM
Productivity
(b) Scatter Diagram: A graph of the

value of one variable vs. another
variable
Absenteeism
Seven Tools of TQM

(c) Cause-and-Effect Diagram/ Fishbone
Diagram/ Ishikawa Diagram : A tool
that identifies process elements
(causes) that might effect an outcome
Cause
Materials
Methods
Effect
Manpower
Machinery
Seven Tools of TQM
Percent
Frequency
(d) Pareto Chart: A graph to identify

and plot problems or defects in
descending order of frequency
Seven Tools of TQM

(e) Flowchart (Process Diagram):
A chart that describes the steps in
a process
Seven Tools of TQM
Frequency
(f) Histogram: A distribution showing

the frequency of occurrences of a
variable
Distribution
Repair time (minutes)

Figure 6.6
Seven Tools of TQM

(g) Statistical Process Control Chart:
A chart with time on the horizontal
axis to plot values of a statistic
Upper control limit
Target value
Lower control limit
Time
Basics of Control Charts

A process that is operating with only chance
causes of variation present is said to be in
statistical control.
A process that is operating in the presence of
assignable causes is said to be out of control.
The eventual goal of SPC is the elimination of
variability in the process.
Process Improvement
Process Control
(a) In statistical
control and
capable of
producing within
control limits
Frequency
Upper control limit
Lower control limit
(b) In statistical
control but not
capable of
producing within
control limits
(c) Out of control
Size
(weight, length, speed, etc.)
Control charts
Control charts are a proven technique for improving productivity.

Control charts are effective in defect prevention.
Control charts prevent unnecessary process adjustment.
Control charts provide diagnostic information.
Control charts provide information about process capability
Variables Control Charts

These charts are applied to data that follow a continuous
distribution.
Attributes Control Charts
These charts are applied to data that follow a discrete
distribution.
Control Charts for Variables
Characteristics that can take any real

value
May be in whole or in fractional

numbers
Continuous random variables

X-bar chart tracks changes in the central
tendency of a Process
R-chart indicates a gain or loss of dispersion

These two charts must be used together
CENTRAL LIMIT THEOREM
Regardless of the distribution of the

population, the distributions of means
will tend to follow a normal curve.
The mean of the sample means (x )is
equal to the mean of the population ()
from which the samples were drawn.
The Standard deviation of the distribution
(x ) is population standard deviation ()
divided by the square root of n where n is
the number of sample size.
Population and Sampling Distributions

Population
distributions
Distribution
of sample
means
=
Mean of sample means =x
Beta
Standard
deviation of
x
the sample
n
means
Normal
Uniform
|
3 x 2 x 1 x
=
x
1 x 2 x 3 x
95.45% fall within

2 x
99.73% of allx
fall within 3 x
Setting Control Limits (X-bar Chart)

UCL x Z *
CL x
LCL x Z *
where
Z = Level of Control
x = Mean of some sample statistic or Target Value
x = Standard deviation of sample means
UCL = Upper Control Line
CL = Centre Line
LCL = Lower Control Line
Setting Control Limits (Example)

Randomly select and weigh nine (n = 9) boxes each
hour, Population standard deviation = 1 Ounce
Average weight 17 13 16 18 17 16 15 17 16
16.1 ounces
in the first
9
sample
WEIGHT OF SAMPLE
HOUR
(AVG. OF 9
BOXES)
WEIGHT OF SAMPLE
WEIGHT OF SAMPLE
HOUR
(AVG. OF 9
BOXES)
HOUR
(AVG. OF 9
BOXES)
16.1
16.5
16.3
16.8
16.4
10
14.8
15.5
15.2
11
14.2
16.5
16.4
12
17.3
Setting Control Limits (Example)
=
x
Average
mean of 12
samples
12
i1
Avg of 9 boxes
12
=
16 ounces
x
n 9
z 3
1 ounce
UCL x x z x 16 3
1
16 3 17 ounces
3
9
LCL x x z x 16 3
1
16 3 15 ounces
3
9
Setting Control Limits

Control
Chart for
samples of
9 boxes
Variation
due to
assignable
causes
Out of
control
17 = UCL
Variation due
to natural
causes
16 = Mean
15 = LCL
| | | | | | | | | | | |
1 2 3 4 5 6 7 8 9 10 11 12
Sample number
Out of
control
Variation
due to
assignable
causes
Example 2
A quality control inspector at the Cocoa Fizz soft drink
company has taken three samples with four
observations each of the volume of bottles filled. If the
standard deviation of the bottling operation is .2 ounces,
use the data below to develop control charts with limits of 3
standard deviations for the 16 oz. bottling operation.
Time 1
Time 2
Time 3
Observation 1
15.8
16.1
16.0
Observation 2
16.0
16.0
15.9
Observation 3
15.8
15.8
15.9
Observation 4
15.9
15.9
15.8
Calculate the Mean of Each

Sample
Time 1
Time 2
Time 3
Observation 1
15.8
16.1
16.0
Observation 2
16.0
16.0
15.9
Observation 3
15.8
15.8
15.9
Observation 4
15.9
15.9
15.8
15.875
15.975
15.9
Sample means (Xbar)
Calculate the Standard Deviation of

the Sample Mean
.2
.1
n
4
Step 3: Calculate CL, UCL, LCL
Center line (x-double bar):
15.875 15.975 15.9

x
15.92
3
Control limits for 3 limits (z = 3):
UCLx x z x 15.92 3 .1 16.22

LCLx x z x 15.92 3 .1 15.62
Setting Chart Limits when Population Standard

deviation is not Known
=
UCL x x A2 R
=
LCL x x A2 R
n
where
i1
n
samples
A2
average range of the
control chart factor
mean of the sample means
Control Chart Factors

Factors for Computing Control Chart Limits (3 sigma limits)
SAMPLE SIZE,
n
MEAN FACTOR,
A2
UPPER RANGE,
D4
LOWER RANGE,
D3
1.880
3.268
1.023
2.574
.729
2.282
.577
2.115
.483
2.004
.419
1.924
0.076
.373
1.864
0.136
.337
1.816
0.184
10
.308
1.777
0.223
12
.266
1.716
0.284
Calculate the Range of Each

Sample and Average Range
Time 1
Time 2
Time 3
Observation 1
15.8
16.1
16.0
Observation 2
16.0
16.0
15.9
Observation 3
15.8
15.8
15.9
Observation 4
15.9
15.9
15.8
Sample
ranges (R)
0.2
0.3
0.2
0.2 0.3 0.2

R
.233
3
Center line:
15.875 15.975 15.9

CL x
15.92
3
Control limits for 3 limits:
UCLx x A2 R 15.92 0.73 .233 16.09

LCLx x A2 R 15.92 0.73 .233 15.75
R Chart
Type of variables control chart

Shows sample ranges over time
Difference between smallest and

largest values in sample
Monitors process variability

Independent from process
mean
Setting Chart Limits

For R-Charts
Upper control limit (UCL R ) = D4 R
Lower control limit (LCL R ) = D3 R
where
UCL R upper control chart limit for the range

LCL R lower control chart limit for the range
D4 and D3 values from Table
Control Chart for Range (R-Chart)

Center Line and Control
Limit calculations:
CL R
0.2 0.3 0.2

.233
3
UCL D4R 2.28(.233) .53

LCL D3R 0.0(.233) 0.0
Sample Size
(n)
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Factor for x-Chart
A2
1.88
1.02
0.73
0.58
0.48
0.42
0.37
0.34
0.31
0.29
0.27
0.25
0.24
0.22
Factors for R-Chart
D3
0.00
0.00
0.00
0.00
0.00
0.08
0.14
0.18
0.22
0.26
0.28
0.31
0.33
0.35
D4
3.27
2.57
2.28
2.11
2.00
1.92
1.86
1.82
1.78
1.74
1.72
1.69
1.67
1.65
Control Charts for Attributes: P-Charts & C-Charts
For variables that are categorical such as

Defective / non-defective, good/bad, yes/no,
acceptable/ unacceptable
Use p-Charts when the sample size is known.
Often expressed in percentage.
For e.g. : Number of broken eggs in a carton
of 240 eggs.
Valid for one type of defect
Use c-Charts for discrete defects when only
number of defects are known but not the
sample size
More number of defects could be included.
For E.g. Monitoring
the number of product
Control Limits for p-Charts

Population will be a binomial distribution,
but applying the Central Limit Theorem
allows us to assume a normal distribution for
the sample statistics
UCL p p z p
LCL p p z p
p 1 p
n
p mean fraction (percent) defective in the samples

z number of standard deviations
p standard deviation of the sampling distribution

n number of observations in each sample
Example: p-Chart:
A Production manager for a tire company has
inspected the number of defective tires in five
random samples with 20 tires in each sample.
The table below shows the number of defective
tires in each sample of 20 tires.
Sample
Sample
Size (n)
Number
Defective
20
20
20
20
20
Calculate the Percent defective of Each Sample

and the Overall Percent Defective (p-Bar)
Sample
Number
Defective
Sample Size
Percent
Defective
20
3/20
20
2/20
20
1/20
20
2/20
20
1/20
Total
100
.09
Step 2: Calculate the Standard

Deviation
p(1-p) (.09)(.91)
p=
=
=0.064
n
20
Center line (p bar):
CL p .09
UCL p z
p z
.09
3(.064) .282
LCL
.09
3(.064) .102
Control Limits for c-Charts

Population will be a Poisson distribution, but
applying the Central Limit Theorem allows
us to assume a normal distribution for the
sample statistics
c mean number of defects per unit
c standard deviation of defects per unit
Control limits c Z c
Constructing a C-Chart:
The number of
weekly customer
complaints are
monitored in a
large hotel.
Develop a three
sigma control
limits For a CChart using the
data table On
the right.
Week
Number of
Complaints
10
Total
22
Calculate CL, UCL, LCL
Center line (c bar):
#complaints
22
CL
2.2
# of samples
10
UCL c z c 2.2 3 2.2 6.65

LCL c z c 2.2 3 2.2 2.25 0
Process Capability
A process in statistical control does
not necessarily meet the design
specifications
Process capability is the ability
of the process to meet the design
specifications or customer
requirements for a service or
product.
Process Capability Ratio & Process Capability Index
Process capability ratio, Cp, is given by

Cp =
Upper specification - Lower specification

6
Process capability Index, Cpk, is the measure of

the difference between the desired and actual
dimension of goods/ services.
Cpk = Minimum of
x =Lower specification
3
Upper specification = x
3
THUMB RULE FOR Cp and

Cpk
Red (Bad)
Yellow (OK)
Green (Good)
Cp
Cpk
< 1.00
< 1.00
1.00 - 1.33
1.00 - 1.33
> 1.33
> 1.33
Example
The intensive care unit lab process has an
average turnaround time of 26.2 minutes
and a standard deviation of 1.35 minutes.
The nominal value for this service is 25
minutes with an upper specification limit of
30 minutes and a lower specification limit
of 20 minutes. The administrator of the lab
wants to have three-sigma performance for
her lab. Is the lab process capable of this
level of performance?
Solution
Upper specification = 30 minutes, Lower specification
= 20 minutes
Average service = 26.2 minutes, = 1.35 minutes
Cp =
Cpk =
30 - 20
6(1.35)
Minimum of
= 1.23
26.2 20.0
3(1.35)
= Minimum of [0.938, 1.53]

= .938
30.0 26.2
3(1.35)
Errors
Two types of error are possible with control
charts
A type I error occurs when a process is
thought to be out of control when in fact it is
not
A type II error occurs when a process is
thought to be in control when it is actually
out of statistical control
An Operating Characteristics Curve

= 0.05 producers risk for AQL
Probability
of
Acceptance
= 0.10
Consumers
risk for LTPD
|
0
|
1
Good
lots
|
2
AQL
|
3
|
4
|
5
Indifference
zone
|
6
|
7
LTPD
|
8
Percent
defectiv
e
Bad lots

Session 17,18, Quality Management

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Quality Management

A.K.SINGH, IMI, NEW DELHI

Key Dimensions of Quality

Total Quality Management

Encompasses entire organization from

A.K.SINGH, IMI, NEW DELHI

Seven Concepts of TQM

A.K.SINGH, IMI, NEW DELHI

Shewharts PDCA Model

A.K.SINGH, IMI, NEW DELHI

When and Where to

A.K.SINGH, IMI, NEW DELHI

Tools to Organize the Data

Tools for Identifying Problems

Seven Tools of TQM

A.K.SINGH, IMI, NEW DELHI

Seven Tools of TQM

(b) Scatter Diagram: A graph of the

A.K.SINGH, IMI, NEW DELHI

Seven Tools of TQM

A.K.SINGH, IMI, NEW DELHI

Seven Tools of TQM

(d) Pareto Chart: A graph to identify

A.K.SINGH, IMI, NEW DELHI

Seven Tools of TQM

A.K.SINGH, IMI, NEW DELHI

Seven Tools of TQM

(f) Histogram: A distribution showing

Repair time (minutes)

Seven Tools of TQM

Basics of Control Charts

A.K.SINGH, IMI, NEW DELHI

Upper control limit

Lower control limit

Control charts are a proven technique for improving productivity.

Variables Control Charts

A.K.SINGH, IMI, NEW DELHI

Control Charts for Variables

Characteristics that can take any real

May be in whole or in fractional

Continuous random variables

R-chart indicates a gain or loss of dispersion

CENTRAL LIMIT THEOREM

Regardless of the distribution of the

Population and Sampling Distributions

95.45% fall within

Setting Control Limits (X-bar Chart)

Setting Control Limits (Example)

A.K.SINGH, IMI, NEW DELHI

Setting Control Limits (Example)

A.K.SINGH, IMI, NEW DELHI

Setting Control Limits

A.K.SINGH, IMI, NEW DELHI

A.K.SINGH, IMI, NEW DELHI

Calculate the Mean of Each

Sample means (Xbar)

A.K.SINGH, IMI, NEW DELHI

Calculate the Standard Deviation of

A.K.SINGH, IMI, NEW DELHI

Step 3: Calculate CL, UCL, LCL

Center line (x-double bar):

15.875 15.975 15.9

Control limits for 3 limits (z = 3):

UCLx x z x 15.92 3 .1 16.22