Managing quality and logistics

Inleiding tot de logistiek (3542)
Prof. dr. Kris Braekers

Course overview
Inventory Quality Warehouse
SC strategy + Production
Introduction managemen managemen managemen
Inv. Mgmt. strategy
t t t
HC 1 HC2 HC 3 HC 4 HC 5 HC 6
WZ 2: WZ 4:
WZ 1: WZ 3:
/ / case case
exercises exercises
study study
Ch.1+7 Ch.2+12 Ch.12 Ch.16 Ch.5+6 /
Responsiecollege
2
Managing Quality
(chapter 5)
Quality?
Quality?
4
Quality?
Products Services
Conformance to ≈ production
Intangible factors
specifications
Performance Consistency
Responsiveness to customer
Reliability
needs
Features ≈ design
Courtesy/friendliness
Durability Timeliness/promptness
Serviceability Atmosphere
5
Defining quality
Conformance
to
specifications
Psychological
Fitness for use
criteria
Quality
Support Value for price

services paid
6
Cost of quality?
Cost of quality?
7
Cost of quality?
Prevention costs • To prevent poor quality from occurring
Appraisal costs • To detect defects
• Associated with discovering poor product quality

Internal failure costs before the product reaches the customer
• Associated with quality problems that occur at

External failure costs the customer site
8
Cost of quality?
 To which category belong the following costs?
 Employee training
 Reworking defective items
 Inspecting products
 Machine downtime due to failures in the process
 Collecting customer information
 Dealing with customer complaints
Prevention costs • To prevent poor quality from occurring
Appraisal costs • To detect defects
• Associated with discovering poor product quality

Internal failure costs before the product reaches the customer
• Associated with quality problems that occur at the

External failure costs customer site
9
Cost of quality?
10
Evolution of quality management
 Concept of quality has changed
 Reactive vs. proactive
11
Evolution of quality management
 Quality gurus
 “Variability exists in every production process”
 “Only 15% of quality problems are due to worker errors”
 Planning, control, improvement
 “Do it right the first time”
 “Quality is free” -> zero defects
 “80% of all defective items are caused by poor product design”
 Fitness for use, instead of focusing on technical specs
 Traditional view of conformance to specifications is incorrect
12
Total quality management (TQM)
Inspecting products
after production Identify root cause of
quality problems and
correct them at the
source
13
 Customer focus
 Continuous improvement
 Employee empowerment
 Use of quality tools
 Product design
 Process management
 Managing supplier quality
14
 Customer focus
 PDCA/PDSA cycle
 Benchmarking
 Product design
 Quality at the source
15
 Customer focus
 Product design
16
17
 Customer focus
 Product design
18
 Quality function deployment (QFD)
 Translating the voice of the customer into specific technical requirements
 Enhances communication between functional departments
 House of quality
19
Concluding remarks
 Quality awards
 Malcolm Baldrige National Quality Award
 Deming prize
 ISO standards
 ISO 9000
 ISO 14000
 Why TQM fails
 TQM across the organization
21
Quality Control & Six Sigma
(chapter 6)
Product variation
 Variation
 No two products are exactly alike
 Two types of causes
Common causes Assignable causes

of variation of variation
 Quality control
 How much common variation is there?
 Is there any other variation (with assignable cause) present?
 Using descriptive statistics and sampling

 Statistical quality control
23
Descriptive statistics
 Central tendency
 Mean
 Variation
 Range
 Standard deviation
24
25
 Mean
 Variation
 Range
 Distribution
 Symmetric vs. skewed
26
27
 Mean
 Variation
 Range
 Distribution
 Symmetric vs. skewed
 Assumption: process output follows the normal distribution
28
 Normal distribution
29
Statistical quality control
While production process Before or after

is running production
Statistical process control Process capability Acceptance sampling
30

31

Is process in state of control?
In control = there is only

common variation (i.e.,
variability in process is as
expected)
Control limits / control charts
32
Statistical process control: control charts
33
 Control chart
 Center line (CL) at average
 Control limits (UCL,LCL) usually at
34
 Control charts for variables
 Monitor characteristics that can be measured and have a continuous scale
 Two types:
 Mean charts (x-bar charts, charts)
 Range charts (R charts)
 Control charts for attributes

 Monitor characteristics that have discrete values and can be counted
 E.g., yes/no decisions, number of defective items
 Two types:
 P charts
 C charts
36
Control charts for variables
 Monitor central tendency of a process
 Detect changes in the mean of a process
 Mean charts (x-bar charts)
37
 Approach 1 (standard deviation of process is known):

 Take samples of 4-5 observations each
 Calculate mean for every sample ()
 Calculate mean of all sample means:
 Calculate control limits:
With:
number of standard deviations (usually 3)
standard deviation of the distribution of the sample means
standard deviation of the population (process)
sample size (number of observations per sample)
38
39

Suppose:
 Calculate mean for every sample () st.dev. of the process
With:
number of standard deviations (usually 3)
standard deviation of the distribution of the sample means
standard deviation of the population (process)
sample size (number of observations per sample)
40
41
 Approach 2 (standard deviation of process is not known):

With:
tabulated values (table 6.1), depending on sample size
average range of the samples
42
43
 Approach 2 (standard deviation of process is not known):

With:
average range of the samples
44
 Monitor variability of a process
 Detect changes in the variability of a process
45
 Approach:
 Calculate range for every sample ()
 Calculate mean of all ranges ()
With:
46
47
 Approach:
48
49
50
51
52
53
54
Control charts for attributes
 Quality characteristics that are counted rather than measured
 P charts
 Monitor the proportion of items in a sample that are defective
 Requires that both the number of defective units and total size of the
sample can be counted
 C charts
 Monitor the actual number of defects
 When proportion cannot be calculated
55


expected)
56


expected)
57


Is process capable of producing Accept or reject an existing batch
acceptable products? of products?
Capable = small probability of Randomly inspecting a number
producing a defect (i.e., product of items
expected) with incorrect specifications)
Specification limits / capability Sampling plan / OC curve

index
58
Process capability
 Control charts:
 Make sure the process is in control (i.e., there is no assignable variation)
 But are we producing the products that we want/designed?
 Product specifications (or tolerance limits)

 By product design engineers/specialists
 Based on how the product is going to be used or what customers expect
 Upper and lower specification limits (USL, LSL)
 Process capability
 Is a process capable of producing acceptable products?
59
Process capability
60
Process capability
61
Process capability
 First measure:
62
Process capability
 First measure:
63
Process capability
 First measure:
 Second measure:
With:
mean of the process
standard deviation of the process
64
Process capability
 First measure:
 Second measure:
With:
mean of the process
standard deviation of the process
 Second measure is better
65
Six Sigma Quality
 Distance between process mean and specification limits is 3 sigma

 Process is minimally capable
 0.26% of the products is not acceptable
 Distance between process mean and specification limits is 6 sigma

 Probability of making a defective product is very small
(only 0.0000002% in case of centered process)
 Two aspects of the Six Sigma concept

 Use of technical tools
 Statistical quality control
 Quality tools in chapter 5
 People involvement
 Training (black/green belts)
 DMAIC cycle
66



index
67



index
68



index
69
Acceptance sampling
 100% inspection is often not possible/desirable
 Instead, use a sampling plan

 Size of the lot (N)
 Size of the sample (n)
 Number of defects above which the lot is rejected (c)
 Number of samples
 Simple, double, and multiple sampling
 Sample parameters (n, c) are determined by setting values for

 Acceptable quality level (AQL) -> producer’s risk
 Lot tolerance percent defective (LTPD) -> consumer’s risk
70
Acceptance sampling
 Operating characteristic curve
 Shows the discriminating power of the sampling plan
 Shows the probability of accepting a lot given various proportions of
defects in the lot
71
Acceptance sampling
72
Acceptance sampling
73
Inspecting products for quality
 How much and how often?
 Product cost and product volume
 Consider the trade-off between cost of inspecting and cost of passing on a
defective product
 Process stability
 Lot size
 Where to inspect?
 Inbound materials
 Finished goods
 Prior to costly processing
74
Voorbereiding werkzitting
 Lees Chapter 6: Quality Control and Six Sigma
 Bestudeer de “Solved Problems” op het einde van het
hoofdstuk
 Voorbereiden:
 Oefening 6(a+b) (p.227)
75

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Inleiding tot de logistiek (3542)

Prof. dr. Kris Braekers

Ch.1+7 Ch.2+12 Ch.12 Ch.16 Ch.5+6 /

Support Value for price

Prevention costs • To prevent poor quality from occurring

Appraisal costs • To detect defects

• Associated with discovering poor product quality

• Associated with quality problems that occur at

Prevention costs • To prevent poor quality from occurring

Appraisal costs • To detect defects

• Associated with discovering poor product quality

• Associated with quality problems that occur at the

 Why TQM fails

 TQM across the organization

 Two types of causes

Common causes Assignable causes

 Using descriptive statistics and sampling

While production process Before or after

Statistical process control Process capability Acceptance sampling

While production process Before or after

Statistical process control Process capability Acceptance sampling

While production process Before or after

Statistical process control Process capability Acceptance sampling

Is process in state of control?

In control = there is only

Control limits / control charts

 Control charts for attributes

 Approach 1 (standard deviation of process is known):

 Calculate control limits:

 Approach 1 (standard deviation of process is known):

 Calculate control limits:

 Approach 1 (standard deviation of process is known):

 Approach 2 (standard deviation of process is not known):

 Calculate control limits:

 Approach 2 (standard deviation of process is not known):

 Calculate control limits:

While production process Before or after

Statistical process control Process capability Acceptance sampling

Is process in state of control?

In control = there is only

Control limits / control charts

While production process Before or after

Statistical process control Process capability Acceptance sampling

Is process in state of control?

In control = there is only

Control limits / control charts

While production process Before or after

Statistical process control Process capability Acceptance sampling

Is process in state of control?

Specification limits / capability Sampling plan / OC curve

 But are we producing the products that we want/designed?

 Product specifications (or tolerance limits)

 Second measure is better

 Distance between process mean and specification limits is 3 sigma

 Distance between process mean and specification limits is 6 sigma

 Two aspects of the Six Sigma concept

While production process Before or after

Statistical process control Process capability Acceptance sampling

Is process in state of control?

Specification limits / capability Sampling plan / OC curve

While production process Before or after

Statistical process control Process capability Acceptance sampling