Chapter 3 - Quality Management[1].

CHAPTER 3

QUALITY MANAGEMENT QUALITY CONTROL: Quality is an important dimension of production and operations management. It is not enough to produce goods and services in right quantity and at the right time; it is important to ensure that the goods and services produced are of the right quality. The consumer of the final product of a company needs a certain quantity of products of a quality appropriate to his needs. Without quality the other dimensions of quantity and time have little relevance. Quality Management, which includes ensuring proper quality for a company’s output, is important not only for its survival in the market, but also to expand it’s market or when it wants to enter into a new product line and/or various other marketing ventures. As stated earlier, Quality is defined in various ways. Quality is the performance of the product as per the commitment made by the producer to the consumer. The ‘commitment’ may be explicit such as a written contract or it may be implicit in terms of the expectations of the average consumer of the product. The ‘performance of the product’ relates to the ultimate functions and services, which the final product must give to the consumer. There is also a ‘service and time dimension’ to the quality. The same quality of physical performance should be available over a reasonable length of time. Thus time is also an essential aspect of the quality. C.D. Lewis has defined quality as “an asset, which may be offered to the potential customer of a product or service.” Quality means the degree to which a specific product satisfies a particular class of customers or consumers in general or the degree to which it conforms to a design specification or the distinguishing feature of a product’s taste, colour, appearance etc. “Quality is never an accident; it is always the result of intelligent efforts.” Quality is a strategic marketing decision taken by the company at the outset. It is based on the market or the target market decided by the company. Thus it is a corporate level decision. It is based on various marketing considerations, production constraints, manpower or personnel constraints, and equipment or technology constraints. The decisions regarding quality are not in the hands of one functional manager as this involves overall strategic decisions for the running or the business of corporation. Once such a strategic decision regarding the quality is taken, it is the job of all functional managers, including the production and operations manager, that such strategic objectives and goals are implemented.

“According to Alford and Beatty quality control is “that techniques of industrial management by means of which products of uniform acceptable quality are manufactured” According to Broom quality control is “systematic control by management of the variables in the manufacturing process that affect goodness of the end product” Quality control is one of the important aspects of the production planning and control. It is basically concerned with the “quality production” through regular inspection techniques for Input Raw Materials, Production Process, in Process Products and Final Output Products. We may say that there are three aspects of assuring quality. • Assuring of incoming raw material’s quality. • Assuring that proper processes are operating on the raw materials. • Assuring of the quality of the out going finished goods.

Raw Materials

Are Raw Materials Okay?

Production

Proces s Are right processes Operating on the Raw materials?

Finished Goods.

Are finished goods Okay to be sent to Customers?

BASIC ASPECTS OF ASSURING QUALITY Planning and Control aspects of quality control: To achieve the required quality for a product, number of specifications are finalised at the time of designing the product. This is planning aspect of the quality. At the time of the production of the product, strict adherences to these specifications are observed; this is control aspect of the production. Thus quality is a combination of both the aspects of production viz. planning and control. The prime importance is to be given to the “Consumer Satisfaction” and for consumers’ satisfaction a product or service, which a consumer wants, must possess certain features. They are properties or attributes of the products/services, which make them “fit for use”, or makes consumer satisfied. When these characteristics or attributes are mentioned specifically for a particular product or service they become specifications of that particular product/service. As far as possible theses characteristics should be expressed in quantitative terms, so that they can be measured or observed objectively. Many times these characteristics can easily be measured on numerical scales. For e.g. weight or volume of a particular packed product in each packet, or average of a vehicle in terms of kilo meters per liter of petrol consumed in standard drive condition, size of an electrical cable in diameter

etc. Such characteristics are known as ‘variables’. It is not possible to 100% adhere to these specifications and hence an upper and/or lower limits of variance from these specifications are finalised as acceptable values. These are known as tolerances. The products beyond these tolerances are considered defective or unacceptable as per quality specifications/standards and are rejected. Some of the characteristics of the product/service may not be feasible to be specified in numerical terms. For e.g. colour of a car. Consumer can appreciate it as good or bad. Here the measurement or assessment of quality becomes more difficult. It depends on the person making a decision. What one, may consider good, may be considered bad by another. The quality characteristics of this type are called ‘attributes’, assessment of which is subjective and is left to the consumers. Attributes are binary (yes or no) conditions. One has to say yes or no. Quality of Design and Quality of Conformance: A functional definition of quality leads us to consider two aspects, which contribute to the ultimate quality of the product. The intrinsic quality intended in the design is the first aspect, while the degree to which this quality is achieved in production is the second aspect. The first is called ‘quality of design’ and the second, ‘quality of conformance’. Some of the quality characteristics (properties or specifications) are acquired by a product at the design and development stage. Properties acquired by product at this stage depends on the type of materials used, tolerances specified, method of production or type of process used, safety factors allowed, knowledge and skill of the design, personnel employed etc. Quality of design refers to these specifications or properties, which are acquired at the design and development stage. To provide a customer with a good quality of product/service, quality of design is a fundamental prerequisite. Once the designer has produced a quality design for the market, the production function has to adhere to the specifications laid down by the design and produce it in accordance with the same. The success with which this is achieved is called ‘quality of conformance’. Thus a manufacturer/service provider must satisfy the customer by meeting their expectations on both the aspects of quality i.e. Quality of Design and Quality of Conformance. Howsoever successful the production is in achieving quality of conformance; it cannot go beyond the quality laid down by the design. The production achieves the quality that is balance between their capability and the requirements of a design. The design itself should consider the type of manpower available and the equipments to be used. Quality is a collaborative effort of the designer and the production. Costs aspect of quality: To most of the people, quality means high quality. Actually it is not so. Generally, the customer wants the best quality they can buy within the money they can afford to

spend. It does not mean that they want only the very best. They select the very best from the products or services available at the price, which they are willing to pay. Therefore, a manufacturer/supplier/service provider tries to achieve the best quality within the price range that their potential customers are willing to pay. Thus Cost of quality is another important area of design and production. While increasing the quality of the product, we tend to increase its cost, but the value added to the final product tends to grow less rapidly. (See the graph bellow) A Production Cost Value of the final Product being sold

Rupees Quality From the above graph you can observe that at some point (A) cost of production goes higher than the value of the final product being sold and thus we can observe that stretching development of quality to such an extent becomes unviable from the business point of view. Irrespective of the above, importance of Quality cannot be underestimated. It is very important for a manufacturer of products or services to be qualitative, because the very existence of a manufacturer depends on the quality level. Good quality ensures higher profitability, creates goodwill, and makes the employment of highly skilled manpower with better wages possible. Poor quality or high proportion of defective products results in the extra cost to a producer. Often it is observed that a producer has to bear losses due to poor quality. Following point explains the consequences of poor quality: 1. Poor quality results in to reduction in sales. 2. Manufacturer’s goodwill in the market is affected. 3. Manufacturer, who has guaranteed the goods, is required to sustain the loss/replace the goods, to compensate the customer for the poor quality of the products sold. 4. Defective goods may be required to be sold at discounts/loss as seconds. 5. Defective products may create stoppages and delays in production thus adding to the loss.

6. Cost of rework/servicing and/or repairing of defective products may be additional burden on the manufacturer. 7. Cost of defective products include, not only raw material cost but also cost of taxes, transport, labour, machine time and overheads of the company. 8. It also adds to burden of inventory and blocking of cash flow because many times decision to dispose of such products involves more than one authority (such as higher level management, excise departments etc.) 9. Generation of defective goods invites more vigorous inspection adding to the cost of production. 10. Nobody wants to own the responsibility of the production of defective products and thus tries to push the liability on other persons/departments. This in turn creates disharmony in the mutual relationships amongst the various departments and lowers the morale of the people working in the company. 11. Diagnosing of the fault to reduce the defective goods and redeveloping of the products adds to the cost of redesign and development and extra burden on R & D department. How to decide about the quality? In earlier pages we looked in to various aspects related with the quality of products/services. Now important question is who, when, where and how decides about the quality. The marketing department in terms of quality, quantity and price generally makes the assessment of customer’s needs. These details are provided to the designing department of the firm. On basis of such information a committee consisting of representative of various concerned departments, headed by the designed engineer develops detailed specifications of the product planned. Specifications include detailed characteristics of each component and final product. They describe the quantitative specifications of the quality of the product desired in brief or precise manner. The costs of production and performance parameters of the product are also considered while developing proper specifications. However designing of the product is a dynamic job and product needs to be updated and improved on ongoing basis as per the customer’s needs and market feed back. Generally three types of specifications are used to describe the product: They are 1) Technical Specifications, 02) Performance Specifications and 03) Product’s Brand/model name. Technical specifications will state physical and chemical properties desired in the product. Performance specifications will state the performance or use of the product. Products brand or model name helps consumer to precisely indicate their selection and ordering.

Quality Management: Just in any management process, quality management also has three main components: (a) Planning, (b) Implementation and (c) Monitoring and Control. Planning for Quality: The planning part must deal with the following aspects: 1. To set the quality objectives and targets and take into account customers’ needs and the marketability of the products. 2. To carry out pre-production process capability or quality deliverability studies (to find out whether the company is capable of producing and marketing the products of certain quality). 3. To establish the relative importance of the quality characteristics and specifications, and communicate it to the production line people as well as to the vendors supplying the raw materials. 4. To look after various vendor quality control aspects such as examining new vendor facilities, their procedures and systems, setting up of the vendor rating scales and periodic performance evaluation of the vendors. 5. To establish statistical control techniques, charts and sampling plans. 6. To establish training programmes for various personnel in the company so that quality consciousness gains a firm ground in the organization. In short, designing the desirable and deliverable quality standards is the job of Quality Planning. Quality Implementation: The implementation part of quality management deals with the following: 1. Performing laboratory tests and analysis on the raw materials, semi finished and finished products for acceptance/rejection or for process control. 2. Maintaining quality control equipments. (Process, Laboratory and Inspection) 3. Advising and providing assistance for the clarification and solution of quality management problems in manufacture. Quality Monitoring and Control: The monitoring and control function deals with the following: 1. Appraising the quality plan vis-à-vis the problems of production and the problems of vendor quality so that appropriate action is taken to correct the initial planning errors.

2. Appraising quality planning vis-à-vis the actual quality which has reached the customer and what the latter’s reaction is regarding the product quality; how such reactions (if negative) can be set right by modifications to the original quality plan. 3. In addition to performing quality audits, monitoring the costs of quality and providing such information to the quality-planners so that they take appropriate action for the future. Quality Assurance: Quality assurance refers to the assurance to the customer that the products, parts, components, tools, etc. contained specified characteristics and are fit for the intended use. Assurance of quality is not a responsibility of a single person or a department only. Only the inspection department or its personnel cannot be held responsible for assurance of quality. It is the responsibility of everybody connected with the production, directly or indirectly, e.g. each and every department connected with the production – from design and raw material stage to dispatch and transportation stage is responsible. Thus designing engineering department, purchasing department, inspection department, materials handling department, repairs and maintenance department, stores department, production department, sales department, etc. are all equally responsible for assuring quality. There for everyone in the company has important role to play in final quality assurance of their company and has to be alert and perform their duty with sincerity and efficiently. Employees of the company must be made quality conscious. They should e motivated, they must be made aware as to why the quality is important for themselves as well as for their unit. Quality Organization: We now understand that quality is not the concern of only manufacturing department. Quality is everyone’s business. Each department has to contribute to the quality. Quality is built into the product at the product concept stage and is ubiquitous all through out its life. Poor quality can occur because of organizational problems anywhere, or even outside the organization. Top management’s commitment to quality is proper beginning. Quality improvement is to be viewed as a positive effort. Continuous training is thus a key to quality control. Quality function can be organized in several alternative methods, keeping the above principle in mind. Factors involved in building quality organization: 1. Employees’ morale: Increase in morale of the employees’ results into improvement of quality. Morale of the employee may be affected because of

many reasons, such as monotony of work, frustration due to lack of chance of promotion, absence of incentives, stress and fatigue due to working for certain period continuously. For building a quality organization management must take care of all these factors and keep the morale of the employees always at high level. 2. Technical Factors: Unclear specifications and faulty designs, improper or unsuitable or substandard equipments and tools, complex or improper process design, improper repairs and maintenance of tools and machines etc. may work against quality, hence all these factors must be efficiently dealt with in a quality organization. 3. Other factors: Poor or unsatisfactory working conditions, improper ventilation, insufficient light, abnormal temperatures, unsafe working conditions, absence of safety gears, absence of proper sanitation facilities, absence of canteen facilities, etc works against building of quality organization and can not be underestimated or neglected. Steps to be taken for quality assurance: 1. For quality assurance first of all quality specifications for product must be established. This includes specifications for input raw materials, components, parts, tools, production and process design etc. This is to be done at the product design stage. 2. Next step is to develop and evolve the inspection and testing procedures to control the specifications fixed up at step 1 above. 3. Random checking and testing of the product at various stages and systems audit to be carried out surprisingly so as to detect any lethargy in implementation of inspection and procedures. 4. Lastly periodical evaluation of the methods and procedures of inspection as well as quality control is essential to measure the efficiency and effectiveness. On the basis of such evaluation if any changes are warranted they should be implemented without any delay and efficiently. 5. TQM-Total Quality Management, TQC- Total Quality Control, SQCStatistical Quality Control, QCs- Quality Control Circles, Company–wide Quality Control i.e. to include suppliers and vendors also and assist them in develop and achieve certain quality levels, On going education and training of all involved in the production, implementation of ISO standards, adherence to various quality standards, Kaizen and Six Sigma principles are some of the latest techniques and advancements in quality control management. Finally we will conclude the chapter on quality control with listing of quality control functions even at the cost of repetitions of some of them.

Quality Control Functions: 1. To ensure that the product or service is designed in such a way that it meets to the customers’ expectations. 2. To ensure that the product used by customer is not harmful and or injurious and is safe for use and meets with the specifications of mandatory or otherwise required safety standards and specifications. 3. Maintain discipline amongst the employees and keep them in high morale. 4. Ensure that raw material, components, all the parts, tools and equipments of standard quality are only purchased and used. 5. To keep a check on variations occurring in the production and efficiently triggers the corrective actions so that there are no slippages on the quality front at any level. 6. To make employees quality conscious by scientifically fixing their responsibilities and accountability in reference to the quality of the product and organization as a whole. 7. To reduce the generation of waste, spoilage and scrap during the production. 8. To ensure excellent service after sales network to support the customers. Meanings of some of the words connected with the quality: Reliability: Reliability is something different from quality. It is related to quality but it is something more than that. It is the probability that a product or a part or system or equipment will perform satisfactorily for a given time under normal condition of use. May be it relates to the sustainability of the quality over long period of time. A product of better quality may not be reliable. Quality is related with the initial performance of a product but the reliability is related to the continuation of performance over a period of time. A product with better initial performance may fail to give the same performance after some time, in such a case product is not considered reliable. There for manufacturers should not produce quality products but also reliable products. Maintainability: It relates to how fast a product when it fails can be repaired and brought back to use. The time the product is non functional is known as down time. Availability: It is specified in terms of a ratio between the uptime of the product (i.e. the time for which product was under use, say Tu) and total of the uptime and down time (the time product could not be used because of failure, say Td). Availability = Tu/(Tu+Td). **************************