MP - Quality Management

1.
Supply Chain Fundamental
3. Quality Management
Facilitator
Arief B. Suharko, Ph.D., CPIM, CILT
PAGE : 1 UGRA TARAKA SCHOOL – Professional Logistics School
Outline
1. What is Quality Management?
2. Business Integrated Quality System
3. Integrated Planning
4. Process Control
5. Continuous Improvement
6. Management of Human Resources
1
1. Supply Chain Fundamental
What Is Quality Management?
Key operations questions
• What is quality and why is it so important?
• How can quality problems be diagnosed?
• What steps lead towards conformance to specification?
• What is Total Quality Management (TQM)?
2
High quality puts costs down and revenue up
3
Perceived quality is governed by the gap between

customers’ expectations and their perceptions of the
product or service
A ‘Gap’ model of Quality
4
The perception – expectation gap
Quality characteristics of goods and services
5
Aspects of quality
Achieving conformance to specifications

1. Define the quality characteristics
2. Decide how to measure each characteristic
▪ Attributes and variables
3. Set quality standards
4. Control quality against those standards
5. And 6 – Find and correct causes of poor quality and
continue to make improvements.
6
Attribute and variable measures of quality
Examples
▪ Hyatt Regency Skywalk

collapse
▪ USA 1981
▪ 114 people died
▪ Design change in one of
the rod connections during
construction
7
Examples (cont’d)
▪ Deepwater oil spill

▪ Mexico 2010
▪ Largest oil spill in history
▪ 11 Rig workers died
▪ 4.9 millions barrels of
crude oil spilled
▪ Defective cement used
during construction
Examples (cont’d)
▪ Sampoong department
store
▪ Seoul 1995
▪ 502 died
▪ Substandard concrete mix
and design flaws
8
Examples (cont’d)
▪ Rama Plaza Factory

▪ Bangladesh 2013
▪ Deadliest accidental
structural failure in
modern day history
▪ 1129 deaths
▪ 2500 injured
▪ Illegal additions on the
building (corrupted
authorities)
Examples (cont’d)
▪ Banqiao Dam Disaster

▪ China 1975
▪ Est. 175,000 died (approx
26,000 immediate,
remaining after from
famine and subsequent
epidemics
▪ After 1 year of rainfall in
24hours
▪ Design flaw in dam
9
Outline
4. Process Control
Juran Trilogy (Juran and Gryna, 1988)
PLANNING CONTROL IMPROVEMENT
10
Quality Planning
Define Define the customers.
Determine Determine the customer needs.
Develop Develop product and service features to meet customer needs.
Develop Develop processes to deliver the product and service features.
Transfer Transfer the resulting plans to operational personnel.
Quality Control
1 2 3
Evaluate actual Compare actual Act on the
operating performance difference.
performance. with goals.
11
Quality Improvement
Aims to attain levels of performance that are

unprecedented—levels that are significantly better
than any past level.
The methodologies recommended for quality

improvement efforts utilize Six Sigma project teams.
Quality Work Elements
12
Approaches to Quality
Deming’s Approach
Total Quality Control in Japan
ISO 9000 Series
Total Quality Management
Six Sigma
Deming’s 14 Points
Create constancy of purpose for the improvement of product and service
Adopt the new philosophy of cooperation (win-win) in which everybody wins
Cease dependence on mass inspection to achieve quality
End the practice of awarding business on the basis of price tag alone
Improve constantly and forever the system of production, service, planning, or any activity
Institute training for skills.
Adopt and institute leadership for the management of people
Eliminate fear and build trust so that everyone can work effectively.
Break down barriers between departments.
Eliminate slogans, exhortations, and targets asking for zero defects or new levels of productivity.
Eliminate numerical goals, numerical quotas, and management by objectives.
Remove barriers that rob people of joy in their work.
Institute a vigorous program of education and self-improvement.
Put everybody in the company to work to accomplish the transformation.
13
Total Quality Control in Japan
Quality first—not short-term profit first.
Consumer orientation—not producer

orientation.
The next process is your customer—breaking

down the barrier of sectionalism.
Using facts and data to make presentations—

utilization of statistical methods.
Respect for humanity as a management

philosophy—full participatory management.
Cross-functional management.
Kaizen
▪ Philosophy of continuous
improvement, a belief that all
aspects of life should be
constantly improved.
14
Five Types of Waste
Errors requiring rework.
Work with no immediate customer, either internal or external, resulting in

work in progress or finished goods inventory.
Unnecessary process steps.
Unnecessary movement of personnel or materials.
Waiting by employees as unfinished work in an upstream process is

completed.
ISO 9000 Series
Originally published in 1987
Updated in 1994, 2000, 2008 and 2015
Applies to any organization and to all product categories
Does not specify how the requirements are to be implemented
Designed as a minimal quality standard
15
Total Quality Management
Difficult to encapsulate, because it was never clearly defined

industry-wide.
For some, it provided a framework for continuous improvement

and an abundance of tools.
For others, it is a philosophy of value to society;
Total Quality Management (cont’d)
16
Total quality management can be viewed as a

natural extension of earlier approaches to quality
management
What TQM means

▪ Meeting the needs and expectation sof the customers
▪ Covering all parts of the organisation
▪ Service level agreements
▪ Including every person in the organisation
▪ All costs of quality are considered
▪ Prevention costs
▪ Appraisal costs
▪ Internal failure costs
▪ External failure costs
17
The internal customer–supplier concept involves

understanding the relationship between processes
The traditional cost of quality model
18
The traditional cost of quality model with

adjustments to reflect TQM criticisms
The cost of rectifying errors becomes increasingly

expensive the longer the errors remain uncorrected
in the development and launch process
19
Increasing the effort spent on preventing errors occurring

in the first place brings a more than equivalent reduction
in other cost categories
The pattern of some TQM programmes which run

out of enthusiasm
20
What TQM means (cont’d)

▪ Developing systems and procedures which support quality
and improvement
▪ ISO 9000 and its critical commentary.
Six Sigma
Define
Measure
Analyze
Improve/Design
Control/Verify
21
Outline
4. Process Control
Integrated Planning
UNDERSTANDING BENCHMARKING ORGANIZATIONAL

CUSTOMER ASSESSMENT
EXPECTATIONS AND
NEEDS
22
Kano Model: Customer Satisfaction vs Quality Level
Customer Classifications
▪ External Customer
▪ Internal Customer
▪ End User
▪ Transfer Agent
▪ Maintenance Customer
23
Segmentation Concept
Preference Segment Patterns
24
Customer Expectation and Needs Data Collection
CUSTOMER SURVEYS FOCUS GROUPS

SERVICE AND
SUPPORT
Benchmarking Steps
• Identify what is to be benchmarked
Planning • Identify comparative companies
• Determine data collection method and collect data
Analysis • Determine current performance “gap”

• Project future performance levels
• Communicate benchmark findings and gain acceptance

Integration
• Establish functional goals
• Develop action plans

Action • Implement specific actions and monitor progress
• Recalibrate benchmarks
• Leadership position attained

Maturity • Practices fully integrated into process
25
Assessing Quality Culture
The opinions, beliefs, traditions, Two of the most common means

and practices concerning quality. of assessing organization culture:
the focus group and
the written questionnaire
Outline
4. Process Control
26
Process control charting
Process control charting (cont’d)
27
28
The chances of measurement points deviating from

the average is predictable in a normal distribution
Process control charting
29
Process variability
Low process variation allows changes in process

performance to be readily detected
30
In addition to points falling outside the control limits

other unlikely sequences of points should be investigated

31


32


33
Outline
4. Process Control
DMAIC Stages and Objectives
34
DMAIC Stages and Objectives (cont’d)
35
36
Outline
4. Process Control
Resource Requirements to Manage Quality Function
Performance Evaluation
Professional Development
Coaching
37
Summary (Quality Management)

▪ Quality may be exogenous or endogenous, operations can
be geared to deal with these issues
▪ Quality costs and customer expectations need to be
weighed up
▪ TQM and ISO 9000 standards are available, but not
infallible.
Breakout Room Discussion 1 – 20 minutes

1. Define the quality characteristics involved in certain business
processes of Mitra Prodin
2. Decide how to measure each characteristic
▪ Attributes and variables
3. Set quality standards
4. Present in 3 minutes
38
Breakout Room Discussion 1 – 20 minutes

▪ Kindly draw Supply Chain Structure in Mitra Prodin in one PPT slide
▪ Identify business process links among the company
▪ Identify primary members and supporting members
▪ Identify managed process link, monitor process link and not
managed process link
▪ Present in 3 minutes
39

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1.

Supply Chain Fundamental

PAGE : 1 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 2 UGRA TARAKA SCHOOL – Professional Logistics School

What Is Quality Management?

PAGE : 3 UGRA TARAKA SCHOOL – Professional Logistics School

Key operations questions

• What is quality and why is it so important?

• How can quality problems be diagnosed?

• What steps lead towards conformance to specification?

• What is Total Quality Management (TQM)?

PAGE : 4 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 5 UGRA TARAKA SCHOOL – Professional Logistics School

High quality puts costs down and revenue up

PAGE : 6 UGRA TARAKA SCHOOL – Professional Logistics School

Perceived quality is governed by the gap between

PAGE : 7 UGRA TARAKA SCHOOL – Professional Logistics School

A ‘Gap’ model of Quality

PAGE : 8 UGRA TARAKA SCHOOL – Professional Logistics School

The perception – expectation gap

PAGE : 9 UGRA TARAKA SCHOOL – Professional Logistics School

Quality characteristics of goods and services

PAGE : 10 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 11 UGRA TARAKA SCHOOL – Professional Logistics School

Achieving conformance to specifications

PAGE : 12 UGRA TARAKA SCHOOL – Professional Logistics School

Attribute and variable measures of quality

PAGE : 13 UGRA TARAKA SCHOOL – Professional Logistics School

▪ Hyatt Regency Skywalk

PAGE : 14 UGRA TARAKA SCHOOL – Professional Logistics School

▪ Deepwater oil spill

PAGE : 15 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 16 UGRA TARAKA SCHOOL – Professional Logistics School

▪ Rama Plaza Factory

PAGE : 17 UGRA TARAKA SCHOOL – Professional Logistics School

▪ Banqiao Dam Disaster

PAGE : 18 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 19 UGRA TARAKA SCHOOL – Professional Logistics School

Juran Trilogy (Juran and Gryna, 1988)

PLANNING CONTROL IMPROVEMENT

PAGE : 20 UGRA TARAKA SCHOOL – Professional Logistics School

Define Define the customers.

Determine Determine the customer needs.

Develop Develop product and service features to meet customer needs.

Develop Develop processes to deliver the product and service features.

Transfer Transfer the resulting plans to operational personnel.

PAGE : 21 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 22 UGRA TARAKA SCHOOL – Professional Logistics School

Aims to attain levels of performance that are

The methodologies recommended for quality

PAGE : 23 UGRA TARAKA SCHOOL – Professional Logistics School

Quality Work Elements

PAGE : 24 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 25 UGRA TARAKA SCHOOL – Professional Logistics School

PAGE : 26 UGRA TARAKA SCHOOL – Professional Logistics School

Total Quality Control in Japan

Quality first—not short-term profit first.

Consumer orientation—not producer

The next process is your customer—breaking

Using facts and data to make presentations—

Respect for humanity as a management

PAGE : 27 UGRA TARAKA SCHOOL – Professional Logistics School