Total Quality Management and Cost of Quality

Full text

(1)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

Total Quality Management

and Cost of Quality

Evsevios Hadjicostas

The International Quality

movement

ƒ

Operator Quality Control

ƒ

Foreman (Supervisor) Quality Control

ƒ

Full-time Inspectors

ƒ

Statistical Quality Control

ƒ

Total Quality Control

(2)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

2

Total Quality Management

Total Quality Management (TQM) is a

philosophy and involves company

practices that aim to harness the

human and material resources of an

organization in the most effective way

to achieve the objectives of the

organization

(BS 7850)

What is a Process?

Any activity that

accepts inputs, adds

values to these inputs

for customers, and

produces outputs for

these customers. The

customer may be

either internal or

external to the

organization

Process

Inputs

Outputs

Controls

Resources

(3)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

4

Typical Process of TQM

ƒ

Policy and strategy of

the organization

ƒ

Mission

ƒ

Leadership and

commitment

ƒ

Divisional objectives

ƒ

Management of the

organization

ƒ

Organization structure

ƒ

Management system

ƒ

Information system

ƒ

Communication

ƒ

Improvement of the

organization

ƒ

Working environment

ƒ

Measurement of performance

ƒ

Improvement objectives

ƒ

Improvement plans

ƒ

Monitor and review

Presentation Outline

ƒ

Fundamental Concepts

ƒ

Implementing Total Quality Management

ƒ

Quality Improvement

ƒ

Managing for Quality Improvement

ƒ

Tools for Quality Improvement

ƒ

Quality Gurus

(4)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

6

Fundamental Concepts

Commitment to TQM

ƒ

Commitment to TQM by the highest

level of management

ƒ

Promotion of this concept to all levels

and activities of the organization

ƒ

Individual involvement

ƒ

Devotion to continuous improvement

Fundamental Concepts

Customer Satisfaction

ƒ

Internal customers

ƒ

External customers

ƒ

Customer needs

ƒ

Customer expectations

(5)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

8

Fundamental Concepts

Quality Losses

ƒ

Ineffective and inefficient utilization of

human, financial and material resources

in processes

ƒ

Loss of customer satisfaction

ƒ

Loss of opportunity to add more value

ƒ

Loss due to waste or misuse of

resources

Fundamental Concepts

Participation by All

ƒ

Strengths and abilities of individuals

ƒ

Effective utilization of strengths and

abilities

(6)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

10

Fundamental Concepts

Process Measurements

Fundamental Concepts

(7)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

12

Fundamental Concepts

Problem Identification

Fundamental Concepts

Alignment of Corporate Objectives

and Individual Attitudes

ƒ

Appraisal and development of human

resource

ƒ

Quality improvement goals

ƒ

Clear, understandable, specific, measurable,

achievable, realistic, time-bound and agreed to by

all relevant individuals.

ƒ

Focused on customer satisfaction

(8)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

14

Fundamental Concepts

Personal Accountability

Personal Development

ƒ

Responsibilities and authorities for all

individuals

ƒ

Job descriptions

ƒ

Appraisal, training and development of

individuals at all levels

Implementing Total Quality

Management

ƒ

Appropriate systems, improvement tools

and techniques

ƒ

Application and coordination of the

above

(9)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

16

Implementing TQM

Organizational Structure

ƒ

Incremental improvement of processes

ƒ

Review of the appropriateness of the

organizational structure:

ƒ

Laboratory management processes

ƒ

Methods of resource allocation

ƒ

Administrative support processes

ƒ

Human environment

ƒ

Training for all laboratory members

ƒ

Laboratory processes and procedures

Implementing TQM

Process Management Concept

ƒ

Process owner and process customer

ƒ

Responsibilities of management and process

owners:

ƒ

Purpose of each process

ƒ

Customers of each process

ƒ

Needs and expectations of customers

ƒ

Needs and expectations of the process owners

ƒ

Performance standards of processes

ƒ

Measurement of process performance

ƒ

Improvement opportunities

(10)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

18

Implementing TQM

Measurement of Performance

ƒ

Monitoring the performance of all key

functions and processes

ƒ

Key attributes:

cost, time, flexibility, and quality

ƒ

Indicators of process efficiency

labour, capital and material utilization, scrap,

screening, re-adjustment, waiting time, lost time,

impracticable tolerances,excessive stock etc.

ƒ

Measures of customer satisfaction

Customer surveys, surveys of competing products,

routine inspections, customer complaints etc.

Implementing TQM

Improvement Planning Techniques

ƒ

Planning quality improvement

ƒ

Implementing the plan

ƒ

Analyzing the results

ƒ

Re-planning

ƒ

Inter-related improvement plans

ƒ

Involvement of staff

PLAN

STUDY

DO

ACTION

(11)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

20

Implementing TQM

Training

ƒ

Why training

ƒ

To perform individual process

ƒ

To be aware of the relationship with other

processes

ƒ

To understand the significance of our role

and the part we play in customer

satisfaction and business objectives

ƒ

To contribute to the continual improvement

programs

Implementing TQM

Training

ƒ

Environment for quality improvement

ƒ

Training to all laboratory personnel

ƒ

Quality principles and practices

ƒ

Quality improvement methods

ƒ

Subjects for training

ƒ

Management, technical, process, problem

solving tools, communication, skills,

(12)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

22

Quality Improvement

ƒ

Situations requiring improvement

ƒ

High quality costs

ƒ

Customer complaints

ƒ

Health and safety considerations

ƒ

Problem solving techniques

ƒ

Identify opportunities for improvement

ƒ

Apply to all areas of the business

ƒ

Review priorities of improvement before

action

Quality Improvement

A Methodology for Quality Improvement

ƒ

Involve the whole organization

ƒ

Initiate quality improvement projects or

activities

ƒ

Investigate possible areas for improvement

ƒ

Establish cause and effect relationship

ƒ

Take improvement action

ƒ

Confirm the improvement

ƒ

Sustain the gains

(13)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

24

Quality Improvement

Improvement Process

ƒ

Identify

ƒ

Evaluate

ƒ

Plan

ƒ

Execute

ƒ

Check

ƒ

Amend

Quality Improvement

Problem Solving Process

ƒ

Identify subjects for improvement

ƒ

Prioritize

ƒ

Analyze causes of problem

ƒ

Collect data for analysis

ƒ

Assess alternative solutions for actions

ƒ

Select the optimum solution for action

(14)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

26

Quality Improvement

Problem Solving Process

ƒ

Identifying the problem

ƒ

Describing the problem

ƒ

Analyzing the problem

ƒ

Planning the solutions

ƒ

Implementing the solutions

ƒ

Monitoring/evaluating the solutions

Managing for Quality Improvement

Organizing for Quality Improvement

ƒ

Responsibilities for quality improvement

ƒ

Within the organizational hierarchy

ƒ

Management processes

ƒ

Work processes

ƒ

Measurement of the reduction of quality losses

ƒ

Administrative support processes

ƒ

Building of an environment for quality improvement

ƒ

Within the processes that flow across

organizational boundaries

(15)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

28

Managing for Quality Improvement

Organizing for Quality Improvement

ƒ

Responsibilities for quality improvement

ƒ

Within the organizational hierarchy

ƒ

Within the processes that flow across

organizational boundaries

ƒ

Definition of the purpose of each process

ƒ

Communication among departments

ƒ

Identification of internal and external customers

ƒ

Determination of their needs and expectations

ƒ

Searching process improvement opportunities

Managing for Quality Improvement

Planning for Quality Improvement

ƒ

Set quality improvement goals

ƒ

Address the most important quality losses

ƒ

Involvement of everyone

ƒ

Inputs from all, from reviews, from suppliers

from customers

ƒ

Focus on newly identified opportunities and

where there is insufficient progress

(16)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

30

Managing for Quality Improvement

Measuring Quality Improvement

ƒ

Measure of quality losses

ƒ

Associated with customer satisfaction

ƒ

Surveys of current and potential customers

ƒ

Surveys of competing products and services

ƒ

Changes in revenues

ƒ

Inspections

ƒ

Customer complaints

ƒ

Associated with process efficiency

ƒ

Sustained by society

Managing for Quality Improvement

Measuring Quality Improvement

ƒ

Measure of quality losses

ƒ

Associated with customer satisfaction

ƒ

Associated with process efficiency

ƒ

Labour, capital and material utilization

ƒ

Unsatisfactory process output

ƒ

Waiting times

ƒ

Delivery performance

ƒ

Size of inventories

(17)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

32

Managing for Quality Improvement

Measuring Quality Improvement

ƒ

Measure of quality losses

ƒ

Associated with customer satisfaction

ƒ

Associated with process efficiency

ƒ

Sustained by society

ƒ

Failure to realize human potential (surveys of

employee satisfaction)

ƒ

Damage caused by pollution and disposal of

waste and depletion of scarce resources

Managing for Quality Improvement

Measuring Quality Improvement

ƒ

Statistical interpretation of trends

ƒ

Establish and meet numerical targets

ƒ

Measure and track trends

ƒ

Report and review measures

(18)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

34

Tools for Quality Improvement

Data Collection Form

ƒ

Establish the specific purpose of collecting

this data

ƒ

Identify categories of information

ƒ

Find factors that affect these categories

ƒ

Determine how data will be analysed

ƒ

Multivote to reduce both lists

ƒ

Construct a tabular form

ƒ

Provide a place for information about the

origination of the data

Tools for Quality Improvement

(Non-numerical data)

Affinity Diagram

ƒ

Start the issue in broad terms

ƒ

Record individual response in

small cards

ƒ

Mix the cards and spread

them randomly on a large

table

ƒ

Group related cards together

ƒ

Transfer the information onto

paper outlined by grouping

Maintaining a successful C.I. process Understand Customer Requirements Provide Training Establish Controls Getting Management Committment Improve Com-munications in All Areas Consult Customer Interpret Customer Requirements Correctly in Specs&Desig n Provide Operational Definition of Output Identify Customer Know Quality Improvement Tools Investigate Other Continuous Improvement Efforts Establish Measurement System Develop an Effective Corrective Action System Make Project by Project Improvement Determine Process Capability Define Process Involve Middle Mgrs & Top Mgrs. In Steering Committee Establish Consistent Reward System Provide Job Security, Freedom to Fail Provide Middle Managers with Staff Support Provide Clear Program Goals Provide the Time for Middle Mgr. To Participate Create a Grant Access to Information Employee Involvement Break Down Barriers

(19)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

36

Tools for Quality Improvement

(Non-numerical data)

Benchmarking

ƒ

Determine what items to benchmark

ƒ

Determine who to benchmark

(companies, organizations, competitors, etc.)

ƒ

Determine benchmark

(collect data, surveys, interviews etc.)

ƒ

Determine the best-in-class for each

benchmark item

Tools for Quality Improvement

(Non-numerical data)

Brainstorming

ƒ

The steps

ƒ

Generation phase

ƒ

Clarification phase

ƒ

Evaluation phase

ƒ

The rules

ƒ

State the purpose

ƒ

Urge people to

express ideas

ƒ

Offer one thought at

a time

ƒ

Do not criticize ideas

ƒ

Do not discuss ideas

ƒ

Built on other’s ideas

ƒ

Record all ideas

(20)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

38

Tools for Quality Improvement

(Non-numerical data)

Cause and Effect Diagram

ƒ

Define the problem

(effect)

ƒ

Define the major categories of causes

(materials, machines, methods, people, training,

measurements etc.)

ƒ

Construct the diagram

ƒ

Brainstorm possible causes

ƒ

Analyse each cause

ƒ

Identify the root causes

ƒ

Gather data to verify the root causes

Problem

Cause 1

Cause 2 Categ. 1 Categ. 2

Categ. 3 Categ. 4

Tools for Quality Improvement

(Non-numerical data)

Flowchart

ƒ

List the input to the process or

activity

ƒ

who supplies and who receives and

what is done with this input

ƒ

List the outputs from each process

or activity

ƒ

who receives this output and what

happens next

ƒ

Built the chart using the appropriate

symbols and connect all processes

ƒ

Review the chart

(correct duplication

of processes, rework loops etc.)

Approach Counter Order Burger Want Fries? Want Drink? Order Fries Order Drink Pay Cashier YES YES NO NO

Ordering a Burger

Standard Process

Ordering a Burger

Improved Process

Approach Counter Order Combo Meal Pay Cashier

(21)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

40

Tools for Quality Improvement

(Non-numerical data)

Tree Diagram

ƒ

State the core issue problem or goal

ƒ

Define major subcategories of the core

ƒ

Construct the diagram

ƒ

For each subcategory define the

component elements and sub-elements

ƒ

Review the diagram to ensure that there

are no obvious gaps in sequence or

logic

Tools for Quality Improvement

(Numerical data)

Control Charts

ƒ

Select the control chart type

ƒ

Record measurement data on the Y-axis

ƒ

Plot the groups of data

(e.g. by date) on the

X-axis

ƒ

Calculate the average

and control limits

ƒ

Mark points of x-bar

and control limits on

the Y-axis

ƒ

Plot observations

concentration upper action limit upper warning limit

target value

lower warning limits lower action limits

(22)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

42

Tools for Quality Improvement

(Numerical data)

Histogram

ƒ

Collect data

ƒ

Arrange in ascending order

ƒ

Determine the range of the

data

ƒ

Determine the width of each

class interval (column)

ƒ

Put class interval in the X-axis

ƒ

Put frequency scale on the

Y-axis

ƒ

Draw the height of each

column

0 2 4 6 8 10 12 14 16 18 1 2 3 4 5 6 7 8 9 10 11 12 Class Series Fr eq ue n cy

Tools for Quality Improvement

(Numerical data)

Pareto Diagram

ƒ

Select the items to be analyzed

ƒ

Select the unit of measure for analysis

ƒ

Select the time period to be analyzed

ƒ

List the items in the order of decreasing

magnitude

ƒ

Construct two vertical axes. The left

scale should present the units of

measures and the right one should be

from 0% to 100%

ƒ

Draw a rectangle above each item

ƒ

Construct the the cumulative frequency

line

0 5 10 15 20 25 30 35 Causes Fr e que n c y 0% 20% 40% 60% 80% 100% 120%

(23)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

44

Tools for Quality Improvement

(Numerical data)

Scatter Diagram

ƒ

Collect paired data

ƒ

Graduate x and y

axes

ƒ

Plot the data

ƒ

Label the axes

ƒ

Examine the pattern

Quality Gurus

ƒ

Philip B. Crosby

ƒ

William E. Deming

ƒ

Joseph M. Juran

ƒ

Armand V. Feigenbaum

ƒ

Kauro Ishikawa

ƒ

Tom J. Peters

(24)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

46

Quality Gurus

Philip B. Crosby

The four absolutes of Quality Management

1. Quality equals conformance to requirement

2. Prevention causes quality

3. Zero defects

4. The measurement of quality is the price of

non-conformance

Quality Gurus

Crosby’s 14 Steps for Quality Improvement

1. Management

Commitment

2. Quality

Improvement Team

3. Measurement

4. Cost of Quality

5. Quality Awareness

6. Corrective Action

7. Zero defects

Planning

8. Employee education

9. Zero defects day

10. Goal Setting

11. Error cause removal

12. Recognition

13. Quality Councils

14. Do it all over again

(25)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

48

Quality Gurus

William E. Deming

PLAN

STUDY

DO

ACTION

Quality Gurus

William Deming’s 14 Points

1.

Constancy of purpose

2.

The new philosophy

3.

Cease dependence

upon inspection

4.

End “Lower tender”

contracts

5.

Improve every

process

6.

Institute training on

the job

7. Institute leadership

8. Drive out fear

9. Breakdown barriers

10. Eliminate exhortation

11. Eliminate targets

12. Permit pride of

workmanship

13. Encourage education

14. Top management

commitment

(26)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

50

Quality Gurus

Kauro Ishikawa

ƒ

Involvement of all employees in

decision making

ƒ

Quality Circles

ƒ

Extensive use of statistics and Quality

Control

Problem

Cause 1 Cause 2 Categ. 1 Categ. 2 Categ. 3 Categ. 4

Quality Gurus

Joseph M. Juran

ƒ

Quality Planning

ƒ

Quality Improvement

ƒ

Quality Control

0 20 40 C o st o f Q u alit y

Quality Control During Operation Quality Planning O per at ions B egi n Quality improvement Chronic Waste

(an opportunity for improvement) Original Zone of Quality Control New Zone of Quality Control Sporadic spike

(27)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

52

Quality Gurus

Joseph M. Juran

CUSTOMERS

PRODUCT

DEVELOPMENT

OPERATIONS

MARKETING

CUSTOMERS

FURTHER

PRODUCT

DEVELOPMENT

ETC

The Quality Spiral

Cost of Quality

ƒ

Measurement of the effect of quality

ƒ

Management of processes

ƒ

Involvement of all individuals to the

processes

ƒ

Process owner

ƒ

Cost of conformance

ƒ

Cost of non conformance

(28)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

54

Cost of Quality

ƒ

Costs of control

ƒ

prevention costs

ƒ

The cost of training people, organizing

business etc.

ƒ

appraisal costs

ƒ

Quality control (analyzing, testing, measuring

etc.)

Cost of Quality

ƒ

Costs of failure of control

ƒ

internal defect costs

ƒ

Waste, scrap, rework

ƒ

Poor design, poor R&D, poor

manufacturing work

ƒ

external defect costs

ƒ

Loss of customers, loss of good will, loss

of sales

(29)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

56

Minimizing the Costs of Quality

Defect Rate

C

o

st

s per

G

o

o

d

U

n

it

of

P

rod

uct

100%

Defective

Conformance

Optimum

100%

Good

Level

Cost of Appraisal

and Prevention

Internal and

External Failure

Costs

Total

Quality

Costs

Minimum Costs of Quality

Cost of Quality

The Seven Sources of Waste

ƒ

Overproduction

ƒ

Defective products

ƒ

Waiting lines and delays

ƒ

Stocks of intermediaries/semi-finished

products

ƒ

Transportation

ƒ

Ineffective procedures

(30)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

58

Cost of Quality

The Seven Sources of Wastes

ƒ

Overproduction

Cost of Quality

The Seven Sources of Wastes

(31)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

60

Cost of Quality

The Seven Sources of Wastes

ƒ

Waiting lines

and delays

Cost of Quality

The Seven Sources of Wastes

ƒ

Stocks of intermediary/semi-finished

products

(32)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

62

Cost of Quality

The Seven Sources of Wastes

ƒ

Transportation

Cost of Quality

The Seven Sources of Wastes

(33)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

64

Cost of Quality

The Seven Sources of Wastes

ƒ

Ineffective movements

or actions

Summary

ƒ

Applied philosophy

ƒ

Management commitment

ƒ

Achievement of excellence

ƒ

Management of change

ƒ

Continual improvement

ƒ

Opportunities for improvement

ƒ

Tools for improvement

(34)

In: Wenclawiak, Koch, Hadjicostas (eds.)

Quality Assurance in Analytical Chemistry – Training and Teaching (2nded.)

Hadjicostas, E.: Total Quality Management and Cost of Quality

© Springer-Verlag, Berlin Heidelberg 2010

66

Where to Get More Information

ƒ

http://www.philipcrosby.com

ƒ

http://www.isixsigma.com

ƒ

http://www.deming.org/

ƒ

http://www.juran.com/

ƒ

BS 7850-1:1992 Total Quality Management, Part 1:

Guide to management principles

ƒ

BS 7850-2:1994 Total Quality Management, Part 2:

Guide to quality improvement methods

ƒ

BS 6143-1:1992 Guide to the economics of Quality.

Part 1: Process cost model

ƒ

BS 6143-2:1990 Guide to the economics of Quality.

Part 1: Prevention, appraisal and failure model

Figure

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References

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