The document discusses landmark Supreme Court cases that have provided guidance for interpreting equal employment opportunity laws, including Griggs v. Duke Power Company. In this 1971 case, the Supreme Court ruled in favor of African American employees who argued that Duke Power Company's requirements of a high school diploma or passing two tests to transfer between jobs had a disparate impact and were not justified by job performance needs. The decision established that employment practices that disproportionately exclude protected groups are illegal regardless of employer intent, and that tests must reasonably relate to job performance.

1. Landmark Court Cases
Laws passed by Congress are usually broad in nature and are
refined when applied to specific situations. Furthermore, the
general nature of the equal employment laws both allowed and
caused enforcement agencies such as the EEOC to develop
guidelines and enforce the acts as they interpreted them.
Unfortunately, employers were often confused about the
guidelines and enforcement of equal employment laws by the
EEOC and OFCCP. The confusion and anger that resulted have
led to many lawsuits concerning the interpretation of equal
opportunity laws and guidelines. Again unfortunately, many
court decisions have been not only confusing but, in some
instances, apparently conflicting.
Nevertheless, several Supreme Court decisions have provided
guidance for interpreting equal employment opportunity laws.
Some of the more important decisions are described in the
following sections.
Griggs v. Duke Power Company 4
The Griggs case concerned the promotion and transfer policies
of the Duke Power company at its Dan River Steam Station.
Duke permitted incumbent employees who lacked a high school
education to transfer from an “outside” job to an “inside” job by
passing two tests: the Wonderlic Personnel Test, which purports
to measure general verbal facility, and the Bennett Mechanical
Aptitude Test. The passing scores approximated the national
median for high school graduates.
Web site: National Employment Lawyers
Associationwww.nela.org
In a class action suit, African American employees argued that
these practices violated Title VII, since neither having a high
school education nor passing the tests was necessary for
successful performance on the jobs in question. The suit also
argued that the practices were illegal because a much higher
percentage of African Americans did not have high school

2. educations. The company argued that the requirements were
based on the company's judgment that they would generally
improve the overall quality of the workforce and that the
company had no discriminatory intent in instituting the
requirements. The company argued that its lack of
discriminatory intent was demonstrated by its efforts to help
undereducated employees through financing two-thirds of the
cost of tuition for high school education.
In 1971, the Supreme Court ruled in favor of the African
American employees. The decision established several
significant points concerning equal employment opportunity:
(1) The consequences of employment practices, not simply the
intent or motivation of the employer, are the thrust of Title VII
in that practices that discriminate against one group more than
another or continue past patterns of discrimination are illegal
regardless of the nondiscriminatory intent of the employer; (2)
the disparate impact doctrine provides that when the plaintiff
shows that an employment practice disproportionately excludes
groups protected by Title VII, the burden of proof shifts to the
defendant to prove that the standard reasonably relates to job
performance; and (3) the EEOC's guidelines that permitted the
use of only job-related tests are appropriate.
MGMT 3306
Assignment 2 (Due at 11:59 pm June 30 CST)
Instructions:
1. Please answer the assignment questions in this docx file and
save once you’re satisfied. Assignment 2 covers the lectures
slides for Week 3 and Week 4.
2. There are six assignment problems. Please follow the
instructions given at the end of each question if any.
3. To resubmit your assignment, simply click to open
“Assignment 2” again and click the grey button “Start New

3. Submission” on the upper right corner of the “Review
Submission History” webpage you’re directed to. You can make
as many submissions as you like before the due time. Only the
last submission will be graded.
Assignment Problems (98 points in total):
1. The Carbondale Hospital is considering the purchase of a new
ambulance. The decision will rest partly on the anticipated
mileage to be driven next year. The miles driven during the past
5 years are as follows.
Year
Mileage
1
3,000
2
4,000
3
3,400
4
3,800
5
3,700
(a) Using a simple three-month moving average, forecast the
mileage for Year 6. Please provide at least one step of
calculation and the correct value for full credit. (4 points)
(b) Forecast the mileage for Year 6 using a weighted moving
average with weights of 0.5, 0.3, and 0.2. The weight of 0.5 is
to be attached to the most recent mileage and 0.3 to the second
most recent mileage. For full credit, please provide at least one
step of calculation and the correct forecast. (4 points)

4. (c) Forecast the mileage for Year 6 using exponential smoothing
with α = 0.2 and the Year 5 forecast of 3,500. For full credit,
please provide the formula, at least one step of calculation and
the correct forecast. (6 points)
(d) Estimate the regression equation using simple linear
regression analysis. For both parameters a and b, please provide
the formula, at least one step of calculation, and the correct
value for full credit. (12 points)
(e) Forecast the mileage for Year 6 using the regression
equation from (d). Please provide one step of calculation and
the correct answer for full credit. (4 points)
2. Income at the architectural firm Spraggins and Yunes for the
period February to July was as follows:
Month
February
March
April
May
June
July
Income
(in $1,000)
70.0
68.5
64.8
71.7
71.3
72.8
Use trend-adjusted exponential smoothing to forecast the firm’s
August income. Assume that the forecast for July without trend

5. adjustment is $70,000 and the trend estimate for July is 0. Set
smoothing constants α = 0.1 and β = 0.2. Please provide
calculation steps for F8, T8, and FIT8. (12 points)
3. Samples are taken to monitor a filling process. The overall
mean of the samples are cc and the average range cc. The
sample size is 10.
(a) Determine the upper and lower control limits of the chart.
Please give the formulas for calculating UCL and LCL and at
least one step of calculation for full credit.(8 points)
(b) Determine the upper and lower control limits of the R chart.
Please give the formulas for calculating UCL and LCL and at
least one step of calculation for full credit.(8 points)
4. The results of inspection of DNA samples taken over the past
10 days are given below. Sample size is 100.
Day
1
2
3
4
5
6
7
8
9
10
# of defectives
7
6

6. 6
9
5
0
0
8
6
1
(a) Determine the fraction defective of the p chart. Please give
the formula and at least one step of calculation for full credit.(6
points)
(b) Determine the of the p chart. Please give the formula and at
least one step of calculation for full credit.(6 points)
(c) Determine the 3-sigma upper control limit and the 3-sigma
lower control limit of the p chart. For each control limit,
provide at least one step of calculation for full credit.(8 points)
5. Suppose the difference between the upper specification and
the lower specification limits is 1.2 inches. The standard
deviation is 0.2 inches. What is the process capability ratio ?
Please provide the formula, at least one step of calculation, and
the correct answer for full credit. (6 points)
6. The specifications for a plastic liner for concrete highway
projects call for a thickness of 4.0 mm 0.3 mm. The standard
deviation of the process is estimated to be 0.05 mm. The
process is known to operate at a mean thickness of 3.8 mm.

7. (a) What is the of the process? Please provide the formula, at
least one step of calculation, and the correct answer for full
credit. (10 points)
(b) Is the process capable based on the value and why? (4
points)
3
Operations and Supply Chain Management
MGMT 3306
Lecture 04
Instructor: Dr. Yan Qin
Outline – Managing Quality
What is Quality
Cost of Quality (COQ)
International Quality Standards
7 Concepts of Total Quality Management
Statistical Process Control
Variations in processes
Process capability
Process control charts

8. 2
What is Quality?
David Garvin, in his book Managing Quality, summarized five
principal approaches to defining quality:
Transcendental view: “I can’t define it, but I know when I see
it”;
Product-based view: Quality is viewed as quantifiable and
measurable characteristics or attributes; (Design quality)
User-based view: Quality is an individual matter, and products
that best satisfy their preferences are those with the highest
quality;
3
What is Quality?
Five principal approaches to defining quality (Cont.)
Manufacturing-based view: “conformance to requirements”
(Conformance quality)
Value-based view: Quality is defined in terms of costs and
prices as well as a number of other attributes.

9. Two Ways Quality Improves Profitability
Improved Quality
Increased Profits
Increased productivity
Lower rework and scrap costs
Lower warranty costs
Reduced Costs via
Improved response
Flexible pricing
Improved reputation
Sales Gains via
Quality Program
Fundamental to any quality program is
the determination of quality specifications, and
the costs of achieving (or not achieving) those specifications.

10. 6
Quality Specification
Design Quality measures how well a product meets customer
expectation.
Specifications of Design Quality
Functions/features intended to deliver
Reliability/durability
Serviceability
Aesthetics
Conformance Quality measures how well design specifications
are met in production.
Cost of Quality
Cost of Quality refers to all of the costs attributable to the
production of quality that is not 100% perfect.
It is estimated that the cost of quality is between 15% and 20%
of every sales dollar. (Philip Crosby: <2.5%)
Three basic assumptions:
Failures are caused;
Prevention is cheaper;
Performance can be measured.

11. Cost of poor quality
8
Four types of costs
External Failure
Internal Failure
Prevention
Appraisal
Total Cost
Quality Improvement
Total Cost
9

12. More Quality Definitions
Fitness for use: Design quality + Conformance quality
Quality Management is the totality of functions involved in the
determination and achievement of quality.
Quality Control focuses on the process of producing the product
or service with the intent of eliminating problems that might
result in defects.
Quality Assurance is a complete system to assure the quality of
a product.
10
International Quality Standards
Series of standards agreed upon by the International
Organization for Standardization (ISO)
Adopted in 1987
More than 160 countries
A prerequisite for global competition?
ISO 9000 an international reference for quality, ISO 14000 is
primarily concerned with environmental management
11

13. International Quality Standards
ISO 9000 series
Common quality standards for products sold in Europe (even if
made in U.S.)
2008 update places greater emphasis on leadership and customer
requirements and satisfaction
ISO 14000 series (Europe/EC)
Core elements include Environmental management; Auditing;
Performance evaluation; Labeling; Life cycle assessment
Total Quality Management is the management of an entire
organization so that it excels in all aspects of goods and
services that are important to the customer.
Deming’s 14 Points
Quality expert Edwards Deming used 14 points to indicate how
he implemented TQM:
Create consistency of purpose
Lead to promote change
Build quality into the product; stop depending on inspections
Build long-term relationships based on performance instead of
awarding business on price
Continuously improve product, quality, and service

14. 14
Deming’s 14 Points – Cont.
Start training
Emphasize leadership
Drive out fear
Break down barriers between departments
Stop haranguing workers
Support, help, and improve
Remove barriers to pride in work
Institute education and self-improvement
Put everyone to work on the transformation
Seven Concepts of TQM
The authors of the textbook developed Deming’s 14 points into
seven concepts for an effective TQM program:
Continuous improvement
Six Sigma
Employee empowerment
Benchmarking
Just-in-time (JIT)

15. Taguchi concepts
Knowledge of TQM tools
1. Continuous Improvement
Represents continual improvement of all processes .
Walter Shewhart developed a circular model know as Plan-Do-
Check-Act as his version of continuous improvement.
PDCA Model
2. Six Sigma
Originally developed by Motorola, adopted and enhanced by
Honeywell and GE.
Six-sigma is a philosophy and methods used to eliminate defects
by reducing the variation in the processes.
Statistically, sigma is a measure of variation. In business
processes, it is a measure of how many defects or failures are
likely to occur per million opportunities.
4 sigma = 6,000 defects per million
6 sigma = 3.4 defects per million

16. Metric in 6-sigma
The calculation of Defects per million opportunities (DPMO)
requires three pieces of information:
Unit: the item produced or being serviced;
Defect: Any item or event that does not meet the customer’s
specification limits;
Opportunities: an chance for a defect to occur
Examples: DPMO
Example 1: The customers of a mortgage bank expect to have
their mortgage applications processed within 10 days of filing.
Suppose all defects are counted and it is determined that there
are 150 loans in the 1,000 applications processed last month
that don’t meet this customer requirement. Then what is the
DPMO in this case?
Example 2: Now suppose the production of a product consists of
two operations. Defects can occur at each operation. There
were 100 defective units out of the total 2,000 units produced.
What was the DPMO in this case?

17. Examples: DPMO – Calculations
Example 1:
Example 2:
6-sigma Methodology
Uses many of the same statistical tools as other quality control
programs.
The difference is that the tools are used in a systematic project-
oriented fashion through define, measure, analyze, improve, and
control (DMAIC) cycle.
The focus of DMAIC is understanding and achieving what the
customer wants.

18. DMAIC
Define critical outputs
and identify gaps for improvement
Measure the work and
collect process data
Analyze the data
Improve the process
Control the new process to make sure new performance is
maintained
DMAIC Approach
6-sigma Implementation
Emphasize defects per million opportunities as a standard
metric
Provide extensive training
Focus on corporate sponsor support
Create qualified process improvement experts (Black Belts,
Green Belts, etc.)
Set stretch objectives

19. This cannot be accomplished without a major commitment from
top level management
3. Employee Empowerment
Getting employees involved in product and process
improvements
85% of quality problems are due to process and material
Techniques include:
Build communication networks that include employees
Develop open, supportive supervisors
Move responsibility to employees
Build a high-morale organization
Create formal team structures
25
4. Benchmarking
Selecting best practices to use as a standard for performance.
Steps include:
Determine what to benchmark
Form a benchmark team

20. Identify benchmarking partners
Collect and analyze benchmarking information
Take action to match or exceed the benchmark
Use internal benchmarking if you’re big enough
Best Practices for Resolving Customer ComplaintsBest
PracticeJustificationMake it easy for clients to complainIt is
free market researchRespond quickly to complaintsIt adds
customers and loyaltyResolve complaints on first contactIt
reduces costUse computers to manage complaintsDiscover
trends, share them, and align your servicesRecruit the best for
customer service jobsIt should be part of formal training and
career advancement
5. Just-in-Time (JIT)
JIT (Just-in-Time) is an approach of continuous and forced
problem solving via a focus on throughput and reduced
inventory.
Throughput is the time required to move orders through the
production process, from receipt to delivery.
Basically it means making only what is needed at the time when
it is need!

21. 6. Taguchi Concepts
Engineering and experimental design methods to improve
product and process design
Identify key component and process variables affecting product
variation
Taguchi Concepts
Quality robustness: Ability to produce products uniformly in
adverse manufacturing and environmental conditions
Quality loss function
Target-oriented quality: a Philosophy of continuous
improvement to bring the product exactly on target
Quality Loss Function
Shows that costs increase as the product moves away from what
the customer wants
Costs include customer dissatisfaction, warranty
and service, internal
scrap and repair, and costs to society
Traditional conformance specifications are too simplistic
Target-oriented quality

22. 7. Tools of TQM
Tools for Generating Ideas
Check sheets
Scatter diagrams
Cause-and-effect diagrams
Tools to Organize the Data
Pareto charts
Flowcharts
Tools for Identifying Problems
Histogram
Statistical process control chart
1. Check Sheet
An organized method of recording data

23. /
/
//////
/////
//////
///
//
/
Hour
Defect12345678
A
B
C
/
/
//
/
According to the check sheet, there were 3 occurrences of
defect A, 2 occurrences of defect B, and 1 occurrence of defect
C in the first hour of operation.

24. 32
2. Scatter Diagram
A graph of the value of one variable vs. another variable
Productivity decreases as Absenteeism increases.
3. Cause-and-Effect Diagram
A tool that identifies process elements (causes) that might effect
an outcome
Causes are classified into 4 categories in this diagram.

25. Example: Cause-and-Effect
4. Pareto Chart
A graph to identify and plot problems or defects in descending
order of frequency
Bars represent frequencies and the dashed curve represents
cumulative probability.
Example: Pareto Chart
5. Flowchart (Process Diagram)
A chart that describes the steps in a process

26. Example: MRI Flow Chart
Physician schedules MRI
Patient taken to MRI
Patient signs in
Patient is prepped
Technician carries out MRI
Technician inspects film
If unsatisfactory, repeat
Patient taken back to room
MRI read by radiologist
MRI report transferred to physician
Patient and physician discuss
6. Histogram
A distribution showing the frequency of occurrences of a
variable

27. 40
7. 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

28. Statistical Process Control (SPC)
Statistical Process Control is a number of statistical techniques
designed to evaluate quality from a conformance view.
Situations where SPC can be applied:
How many paint defects are there in the finish of a car?
How long does it take to execute market orders?
How long do customers wait to be served from our drive-
through window?
Variations around us
All processes have inherent statistical variability which can be
evaluated by statistical methods.
Basic forms of Variations:
Assignable variation: caused by factors that can be clearly
identified and possibly managed, such as workers inadequately
trained.
Common variation: also called random variation, variation that
is inherent in the production process. It is usually a result of the
type of equipment used in the process.

29. 43
USL and LSL
It is impossible to have zero variation!
Engineers therefore assign acceptable limits for variation.
The limits are known as the upper and lower specification limits
(USL/LSL).
Also known as upper and lower tolerance limits (UTL/LTS);
The range defined by USL and LSL is called the specification
range.
44
Example: USL and LSL
Consider the production of boxes of cereal. Suppose the target
value of the weight of each cereal box is 12 oz. The design
specifications might be 12 +/- 2 oz.
This tells the production department that the production should
aim for the weight of 12 oz. However, any weight between 10
and 14 oz. is also acceptable.
In this case, USL = 14, LSL = 10.

30. Process capability
Process capability is the long-term performance level of the
process after it has been brought under statistical control, that
is, having only common variation.
There are two popular measures for determine process
capability:
Process Capability Ratio (Cp)
Process Capability Index (Cpk)
Both of them are measured based on samples taken from
production or test runs.
46
Process Capability Ratio (Cp)
The process capability ratio is calculated as:
is the population standard deviation of the quality measure of
interest.
When only samples are available, we use s instead of in
calculation.
A capable process must have a Cp of at least 1.0
Six Sigma quality requires a Cp = 2.0

31. Example: Mean and Sample Std. Deviation
Suppose a sample from the production of a product consists of 5
data points summarized as follows:
What is the mean and standard deviation of the sample?Data
points9108.810.25
48
Example:
Solution

32. Notes: In the calculation above, represents the ith data point in
the sample and n refers to the sample size, that is, the number of
data points in the sample.
Example: Cp
Suppose for an insurance claims process,
Process mean = 210.0 minutes
Process standard deviation s = 0.516 minutes
Design specification range = 210 ± 3 minutes
What is the process capability ratio in this case?
Example: