Operation management

1. OPERATION MANAGEMENT 2 (OM 2)
OM2: QUALITY TOOLKIT FOR
MANAGERS
Prof. Harish Kutemate

2. SYLLABUS
1 .Introduction to Quality Concepts:
• Dimensions of Quality,
• Cost of Quality,
• Quality Philosophies,
• Quality Systems,
• Contribution of Quality gurus.
Total Quality Management, Text and Cases (Chapter 1 and 3)
By K. Shridhara Bhat,
Himalaya Publishing House
Quality Management (Chapter 7)
By Kanishka Bedi,
Oxford

3. SYLLABUS
2.Quality Assurance and Control –
• Concepts of Quality Assurance & Objectives
• Quality Manual, Specification and Design Control,
• Process Control, Inspection and Testing,
• Quality Assurance in Services
Quality Management (Chapter 13)
By Kanishka Bedi,
Oxford

4. SYLLABUS
3.Statistical Process Control (SPC):
• 7 Tools of Quality
• Control Charts for Variable and Attributes
• Control Chart Techniques
• X bar, R bar Correlation
• Pareto Diagrams
• Cause and Effect Diagrams
• Scatter Diagrams, Run Charts, Histograms and Flow Charts
Production and Operations Management (Chapter 17)
By K.Aswathappa and K. Shridhara Bhat
Himalaya Publidhing House
Operations Management, Theory and Practice (Chapter 8)
By. B.Mahadevan
Pearson Publication

5. SYLLABUS
4.TQM tools:
• TQM Frame Work
• Benchmarking / Benchmarking Process
• QFD (Quality Function Deployment)
• TPM (Total Productive Maintenance)
• FMEA (Failure More and Effects Analysis).
Total Quality Management, Text and Cases
By K. Shridhara Bhat,
Himalaya Publishing House
Quality Management
By Kanishka Bedi,
Oxford

6. SYLLABUS
5.Quality Improvement Techniques:
• KAIZEN, Six Sigma, ISO, 5S, QC
• Poka-Yoke
• Lean Manufacturing
• Service Quality
Production and Operations Management (Chapter 20)
By R. Paneerselvam (Third Edition),
Eastern Economy Edition
Operations Management (Chapter 5,Page 171)
By B Mahadevan
Pearson Publication

7. What is quality?
“Meeting the customer requirements”.
Quality is also defined as excellence in the
product or service that fulfills or exceeds the
expectations of the customer.

8. Quality is totality of features and characteristics of
product (goods and services) that bears on its ability to
satisfy given needs”

17. Cost of Quality
Cost of Quality is the total expenses incurred by an
organization in achieving and maintaining good
quality as well as in managing poor quality with an
aim of attaining the highest level of customer
satisfaction.
Therefore, quality costing technique has become as
one of the most “effective management tool” for
collecting and “measuring” the expenses in
maintaining quality in a production process

18. QUALITY COSTING- HOW
IT ARISES?
• Quality issues can come up in any company,
and these issue result in quality costing.
The problem may be due to a problem or
an error by one or more departments.
• For example: a flaw in product designing
would render the whole process useless.

19. Cost of Prevention
Associated with preventing defects before they happen
and to do the job right the first time.
Prevention costs may include …
• Costs of verifications
• Costs of redesigning the product to make it simpler
to produce
• Cost of redesigning the process to remove causes of
poor quality

20. • Cost of training employees in the methods of
continuous improvement
These are planned before actual operation and money is
all spent before the product is actually built.

21. Appraisal Costs
Associated with measuring and monitoring activities
related to quality.
They could include…
• Verification: Checking of incoming material, process
setup, and products against agreed specifications
• Quality Audits: Confirmation that the quality system
is functioning correctly

22. Internal Failure Costs
Internal failure costs are incurred to remedy defects
discovered before the product or service is delivered to
the customer.
These costs occur when the results of work fail to reach
design quality standards and are detected before they
are transferred to the customer.
They could include…
Scrap, defective product or material that cannot be
repaired, used, rework or rectification correction of
defective material or errors

23. External Failure Costs
Incurred to remedy defects discovered by the customers
They could include…
• Repairs and Servicing: of both returned products and
those in the field
• Warranty claims: Failed products that are replaced or
services that are re-performed under a guarantee
• Complaints: All work and costs associated with
handling and servicing customers’ complaints
• Returns: Handling and investigation of rejected or
recalled products, including transport cost.

25. Quality Guru’s & Philosophies
1) Deming 2) Juran
3) Crosby 4) Feigenbaum
5) Ishikawa 6) Garvin
7) Shingo 8) Taguchi
Despite there are Eight gurus in assessing Total Quality
Management (TQM), but there are differences in their
opinions…

26. • Dr. W. Edwards Deming, Dr. Joseph Juran and Phillip B.
Crosby are regarded as the management gurus in the
quality revolution.
• These three quality gurus together with other
individuals who have helped to shape current thinking
in quality management

30. Deming `s 14 points for management
1) Create a Constant Purpose towards Improvement of Product
and Service
2) Adopt the New Philosophy for Economic Stability
3) Institute Training on the Job
4) Eliminate Fear
5) Eliminate the Use of Unclear Slogans, Posters
6) Remove Barriers to Pride of Workmanship
7) Stop Depending on Inspections

31. Deming `s 14 points for management
8) Use Single Supplier for any One Item
9) Improve Constantly & Forever
10) Implement Leadership
11) Breakdown Barriers Between Department
12) Eliminate Management by Objectives
13) Implement Education & Self-Improvement
14) Make Transformation in Everyone’s Job

33. 2) Joseph M. Juran
Continuous Improvement
Quality as Fitness for Use
Contributed to Cost of Quality
Introduced the Pareto Principle
Juran’s Quality Trilogy
• Quality Planning – A continuous method whereby Top
Management is strategically planning for improved Quality.
• Quality Control – A on-going monitoring process to detect &
correct any Quality issues.
• Quality Improvement – A drive for breakthrough results to
resolve chronic issues.

34. Philip B. Crosby
• Quality is Conformance to Requirements
• Stressed Senior Management
Involvement & Continuous Improvement
• Contributed to the Cost of Quality
Concept (Quality is Free)
• 4 Absolutes of Quality Management

35. Genichi Taguchi
• Loss Function Concepts –
Quality Cost
• Signal to Noise Ratio &
Design Robustness
• Experimental Design (DOE)
Walter A. Shewhart
• Control Charts – Assignable v.
Chance Cause
• PDCA (Plan – Do – Check –
Act)
• Statistical Process Control &
Statistical Improvement