Quality Concepts

1. Basic QC concepts
By
Dr.M.Valliammal
Professor, AMET Business School
Chennai

2. What is Business?
• An organization or economic system where goods
and services are exchanged for one another or for
money.(Business Dictionary)
BUSINESSSUPPLIERS CUSTOMERS
OTHER STAKEHOLDERS

3. Customers/Consumers
• A customer is an individual or business that purchases
the goods or services produced by a
business. Attracting customers is the primary goal of
most public-facing businesses, because it is the
customer who creates demand for goods and services.
Businesses often compete through advertisements or
lowered prices to attract an ever-larger customer base.
• A Consumer is a person or organization that use
economic service or commodities.

4. Company/Industry

6. Product

7. Service

8. Price
• A value that will purchase a finite quantity, weight,
or other measure of a good or service.

9. Concepts
• What is quality?
Dictionary has many definitions: “Essential characteristic,” “Superior,” etc.
• Some definitions that are accepted in various organizations:
• “Quality is customer satisfaction,”
• “Quality is Fitness for Use.”
• What is TQM?
A comprehensive, organization-wide effort to improve the quality of products and
services, applicable to all organizations.
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10. Concepts
• Who is a customer?
Anyone who is impacted by the product or process delivered by
an organization.
External customer: The end user as well as intermediate
processors. Other external customers may not be purchasers
but may have some connection with the product.
Internal customer: Other divisions of the company that receive
the processed product.
• What is a product?
The output of the process carried out by the organization. It may
be goods (e.g. automobiles, missile), software (e.g. a computer
code, a report) or service (e.g. banking, insurance)
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11. Understanding quality chains

12. Productivity
What is productivity ?
• A measure of the efficiency of a person, machine,
factory, system, etc., in converting inputs into
useful outputs.
Productivity is computed by dividing average
output per period by the total costs incurred on
resources (money, machine, material,men)
consumed in that period.
• Productivity =(average output/input) x 100

13. What is Quality?

15. What does the word “quality” mean to you?
• Think about your past experiences travelling in taxi.
Did you experience a “quality” travel?
• Which experience made it a “quality” experience
for you?
• Think about a product you bought. How can you
define its “quality”?

16. Quality in different areas of society
Area Examples
Airlines On-time, comfortable, low-cost service
Health Care
Correct diagnosis, minimum wait time, lower
cost, security
Food Services Good product, fast delivery, good environment
Postal /courier
Services
fast delivery, correct delivery, cost containment
Academia
Proper preparation for future, on-time
knowledge delivery
Consumer Products Properly made, defect-free, cost effective
Insurance Payoff on time, reasonable cost
Military Rapid deployment, decreased wages, no graft
Automotive Defect-free
Communications Clearer, faster, cheaper service

17. What is Quality?
• Conformance to specifications (British Defense Industries
Quality Assurance Panel)
• Conformance to requirements (Philip Crosby)
• Fitness for purpose or use (Juran)
• A predictable degree of uniformity and dependability, at low
cost and suited to the market (Edward Deming)
• Synonymous with customer needs and expectations (R J
Mortiboys)
• Meeting the (stated) requirements of the customer- now
and in the future (Mike Robinson)
• The total composite product and service characteristics of
marketing, engineering, manufacturing and maintenance
through which the product and service in use will meet the
expectations by the customer (Armand Feigenbaum)

18. What is Quality?
• “The degree to which a system, component, or process meets
(1) specified requirements, and
(2) customer or users needs or expectations” – IEEE
• The totality of features and characteristics of a product or service that bears on
its ability to satisfy stated or implied needs” – ISO 8402
• Degree to which a set of inherent characteristics fulfils requirements – ISO
9000:2000

19. What is quality?
• Quality, simplistically, means that a product
should meet its specification
• Q=P/E (Q-quality,P-performance,E-expectation)
• This is problematical for software systems
• Tension between customer quality requirements
(efficiency, reliability, etc.) and developer quality
requirements (maintainability, reusability, etc.)
• Some quality requirements are difficult to specify
in an unambiguous way
• Software specifications are usually incomplete and
often inconsistent

20. Five Approaches of Defining Quality
• Harvard professor David Garvin, in his book Managing Quality
summarized five principal approaches to define quality.
• Transcendent
• Product based
• User based
• Manufacturing based
• Value based

21. Definitions of Quality
• Transcendent definition: excellence
• Product-based definition: quantities of product
attributes
• User-based definition: fitness for intended use;
meeting or exceeding user expectations
• Value-based definition: quality vs. price
• Manufacturing-based definition: conformance
to specifications
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22. Transcendental view
• Those who hold the transcendental view would say “I can’t define it, but I
know it when I see it”
• Advertisers are fond of promoting products in these terms.
“ Where shopping is a pleasure” (supermarket). “We love to fly and it shows"
(airline).
Television and print media are awash with such indefinable claims and
therein lies the problem:
• Quality is difficult to define or to operationalize. It thus becomes elusive
when using the approach as basis for competitive advantage. Moreover, the
functions of design, production and service may find it difficult to use the
definition as a basis for quality management.

23. PRODUCT BASED
• Quality is viewed as a quantifiable or measurable characteristic or
attribute. For example durability or reliability can be measured and the
engineer can design to that benchmark.
• Quality is determined objectively.
• Although this approach has many benefits, it has limitation as well. Where
quality is based on individual taste or preference, the benchmark for
measurement may be misleading.

24. USER BASED
It is based on idea that quality is an individual matter and products that best
satisfy their preferences are those with the highest quality. This is rational
approach but leads to two problems;
 Consumer preference vary widely and it is difficult to aggregate these
preferences into products with wide appeal. This leads to the choice between
a niche strategy or a market aggregation approach which tries to identify
those product attributes that meet the needs of the largest number of
consumers.
 Another problem concerns the answer to the question “Are quality and
customer satisfaction the same?” the answer is probably not. One may
admit that a Lincoln continental(luxury Sedan) has many quality attribute, but
satisfaction may be better achieved with an Ford Escort.

25. MANUFACTURING BASED
• Manufacturing-based definitions are concerned primarily with engineering
and manufacturing practices and use the universal definition of “conformance
to requirements”. Requirements or specifications are established by design
and any deviation implies a reduction in quality. The concept applies to
services as well as product. Excellence in quality is not necessarily in the
eye of the beholder but rather in the standards set by the organization.
• This approach has the serious weakness. The consumer’s perception of
quality is equated with conformance and hence is internally focused.

26. Value Based
• It is defined in term of costs and prices as well as number of
other attributes. Thus, the consumer’s purchased decision is
based on quality at an acceptable price. This approach is reflected
in the popular Consumer Reports magazine which ranks products
and services based on two criteria: Quality and Value.
• The highest quality is not usually the best value. That designation
is assigned to the “best- buy” product or service.

27. More about Quality
• Realistic but demanding STANDARDS;
• Getting things RIGHT FIRST TIME; ‘It costs
less to prevent a problem than it does to
correct it’
• Influences the relationship with CUSTOMERS;
• Influences how COMPLAINTS are dealt with;
• Something to do with how things LOOK and
FEEL.

28. Modern Importance of Quality
“The first job we have is to turn out quality merchandise that consumers
will buy and keep on buying. If we produce it efficiently and economically,
we will earn a profit.”
- William Cooper Procter
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29. History
1. Ancient time – skill craftsmen, blacksmith, etc
2. 1700 – Industrial Revolution
3. 1776 – Adam Smith – division of labour
4. 1790 – Eli Whitney – Interchangeable parts
5. Henry Ford – car industry in USA

30. The Development
• 1950 – Productivity
• 1960 – Productivity + service
• 1970 - Productivity + service + Financial Control
• 1980 - Productivity + service + Financial Control +
Quality + Technology
• 1990 - Productivity + service + Financial Control +
Quality + Technology + Direction
• 2002 Productivity + service + Financial Control +
Quality + Technology + Direction + Information

31. History of Quality Methodology
• Reach back into antiquity, especially into China, India, Greece and the
Roman Empire : skilled crafstmanship.
• Industrial Revolution (18th century): need for more consistent products
that are mass-produced and needed to be interchangeable. Rise of
inspection after manufacturing completed and separate quality
departments.
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32. History of Quality Methodology
• Science of modern quality methodology started by R. A. Fisher perfected
scientific shortcuts for shifting through mountains of data to spot key
ccause-effect relationships to speed up development of crop growing
methods.
• Statistical methods at Bell Laboratories: W. A. Shewhart transformed
Fisher’s methods into quality control discipline for factories (inspired W.E.
Deming and J. M. Juran); Control Charts developed by W. A. Shewhart;
Acceptance sampling methodology developed by H. F. Dodge and H. G.
Romig
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33. History of Quality Methodology
• World War II: Acceptance of statistical quality-control concepts in manufacturing
industries (more sophisticated weapons demanded more careful production and
reliability); The American Society for Quality Control formed (1946).
• Quality in Japan: W.E. Deming invited to Japan to give lectures; G. Taguchi
developed “Taguchi method” for scientific design of experiments; The Japanese
Union of Scientists and Engineers (JUSE) established “Deming Price” (1951); The
Quality Control Circle concept is introduced by K. Ishikawa (1960).
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34. History of Quality Methodology
• Quality awareness in U.S. manufacturing industry during 1980s: “Total Quality
Management”; Quality control started to be used as a mangement tool.
• Malcolm Baldrige National Quality Award (1987)
• International Standard Organization’s (ISO) 9000 series of standards: in 1980s
Western Europe began to use; interest increase in US industry in 1990s; Became
widely accepted today: necessary requirement to world-wide distribution of
product and a significant competitive advantage.
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35. Historical Review
• Late 1980’s – automotive industry emphasize
SPC, suppliers required to use Malcolm Balridge
Award established (to measure TQM
implementation) Taguchi method, Design of
Experiments (DOE)
• 1990’s – ISO 9000 series became Global QA std.,
QS 9000 introduced by automotive industry
customer satisfaction ISO 14000
• 2000 – New ISO 9000:2000 version, Six Sigma
Program introduced information technology

36. History of Quality Methodology
• Quality in service industries, government, health
care, and education
• Current and future challenge: keep progress in
quality management alive
• To sum up: A gradual transition
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Statistical
Quality
Control
Quality
Assurance
Quality
Management

37. Evolution of TQM – New Focus
© 2005 Wiley 37

38. Software quality management
• Concerned with ensuring that the required level of
quality is achieved in a software product
• Involves defining appropriate quality standards and
procedures and ensuring that these are followed
• Should aim to develop a ‘quality culture’ where
quality is seen as everyone’s responsibility

39. Quality management activities
• Quality assurance
• Establish organisational procedures and standards for
quality
• Quality planning
• Select applicable procedures and standards for a
particular project and modify these as required
• Quality control
• Ensure that procedures and standards are followed by
the software development team
• Quality management should be separate from
project management to ensure independence