IT 117 – Quality Assurance
Unit 03 – Benefits & Philosophies 1
Instructor:
Daming Zhang, Ph.D.
Professor
Department of Industrial Technology
California State University, Fresno
Dr. Daming Zhang
IT 117 – Quality Assurance
1
Quality Benefits and Philosophies
• Quality Benefits and Philosophies is presented in the
following topic areas:
– Benefits of quality
– Quality philosophies
Dr. Daming Zhang
IT 117 – Quality Assurance
2
Stakeholder Groups
• Many organizational activities require stakeholder support
including allocation of people, resources, money, and time
to assure success
• Stakeholders include: stockholders, customers, suppliers,
company management, employees and their families, the
community and society
• Communication within the entire stakeholder community is
channeled through internal company processes:
sales, marketing, finance,
engineering, manufacturing,
quality, purchasing,
production control, and
management
Dr. Daming Zhang
IT 117 – Quality Assurance
3
Aligning Goals With Stakeholder Needs (1)
• Stockholders benefit from successful ventures because of
the increased revenue and profits
• Management and employees have a vested interest in
continuing their source of income, recognition, and
enrichment through such activities as new products,
processes, construction or services
• Suppliers gain through the increased sales and
relationships with the company
• The benefits to the customer include the use of the new
product, facility, or service, and the attainment of their own
corporate or personal objectives
Dr. Daming Zhang
IT 117 – Quality Assurance
4
Aligning Goals With Stakeholder Needs (2)
• In addition to increasing stockholder value, organizational
performance and strategic goals may be determined for:
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Short term or long term emphasis
Profit
Cycle times
Marketplace response
Resources
• American managers vs. Japanese and European managers
in short term outlook and long term growth
• Stockholder returns vs. re-investment in the company, new
machinery and equipment, wages and salary increases
• For maintaining competitiveness, a reduced product cycle
time must be emphasized
Dr. Daming Zhang
IT 117 – Quality Assurance
5
Supplier Quality Benefits
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A greater opportunity to build long term relationships
Potential training in areas that are mutually beneficial
A greater likelihood of shared beneficial information
Synergy with the customer in technical areas
Association with an end product with a good reputation
A customer that can more clearly state requirements
More predictability and certainty of future orders
More predictability in scheduling and shipping
Financially viable customers for services or products
Dr. Daming Zhang
IT 117 – Quality Assurance
6
Community Quality Benefits
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Organizations that are able to expand and provide jobs
Organizations which pay property taxes
Safe products for the user or consumer
Organizations that enhance property values of surrounding
neighborhoods
Organizations that engender community pride
Organizations that practice good business ethics
Organizations and products that protect public health
Products that make more efficient use of all resources
Products that are more energy efficient
Organizations that utilize environmentally friendly methods
Dr. Daming Zhang
IT 117 – Quality Assurance
7
Employees Quality Benefits
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Job security
Better likelihood of pay increases
Enhancement of knowledge and skills
More prestige
Improved products or services from upstream suppliers
Predictability in work assignments (fewer fires to extinguish)
Reduced cycle times which improves workflows
More respect from company management and peers
Fewer confrontations and disagreements between departments
Better communications and information flow
More valuable company information; since results are more predictable
Potentially a more environmentally friendly place to work
Greater pride of workmanship
Individual self-fulfillment
Satisfaction, development and well-being
Dr. Daming Zhang
IT 117 – Quality Assurance
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External Customer Quality Benefits
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Higher quality products
Products that are potentially more convenient to use
Products that are easier to maintain
Products that are more reliable
Products that are less expensive and offer greater value
A supplier that can more quickly respond to needs
A product or service that has perceived value
Products or services with enhanced features
A supplier that has better service
Better individual treatment in a variety of ways
A supplier better trained to handle complaints
Wider availability of products and services
Warranties that are honored
Quicker corrective action responses
Dr. Daming Zhang
IT 117 – Quality Assurance
9
Organizational Quality Benefits
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A better reputation in the business community
Increased market share by attracting new customers
Greater profitability without raising prices
An ability to charge premium prices because of superior quality
A greater ability to pay and train all employees
Greater capacity and flexibility to handle change
An ability to attract top notch employees
More pride at all organization levels
More loyalty among customers
An ability to weather tough economic times
Faster response to technological change
Better competitive position through innovative products and services
A greater probability of raising capital in the markets
A higher stock price
Dr. Daming Zhang
IT 117 – Quality Assurance
10
Stockholder Quality Benefits
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Increased stock value
Better returns on an investment
A more widely respected business investment
More investment stability
More timely, accurate, and thorough annual reports
Investment in an organization which is technologically advanced
Investment in a company with greater capacity to handle change
Visionary leadership among investment company managers
An organization with a strong focus on the future
An investment company that analyzes critical data and key processes
Investment performance in key areas like ROI, VAE, PIE ratios
Efficient investment performance without creative bookkeeping
An organization with a demonstrated ability to improve
An investment that is cost effective
Dr. Daming Zhang
IT 117 – Quality Assurance
11
Baldrige Criteria for Performance Excellence
• Includes voluntary compliance as well as customer or
organizational mandatory compliance requirements
• The Baldrige Performance Excellence program is used as a
management model by applying the principles presented in
the Baldrige Criteria for Performance Excellence
• The Baldrige journey is about learning how to achieve:
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Effectiveness
Sustainability
Innovation
World-class results
Integrated processes
Organizational learning
A national network to support and sustain your organization
Dr. Daming Zhang
IT 117 – Quality Assurance
12
Baldrige Performance Excellence Program
• Originally called the Malcolm Baldrige National Quality
Award (MBNQA) created in 1987
• The award recognizes manufacturing, service, and small
businesses, who demonstrate exemplary quality in their
practices, products and services
• The Award eligibility categories now include:
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Education
Health Care
Manufacturing
Nonprofit/Government
Service
Small Business
• Criteria in 7 categories, 13 items, with 1000 scoring points
Dr. Daming Zhang
IT 117 – Quality Assurance
13
Criteria Categories and Items
Dr. Daming Zhang
IT 117 – Quality Assurance
14
Major Contributors to Quality Philosophies
Dr. Daming Zhang
IT 117 – Quality Assurance
15
Philip B. Crosby (1928 - 2001)
• Philip Crosby was corporate vice president (ITT) for 14 years
• Mr. Crosby consulted, spoke, and wrote about strategic
quality issues through-out his professional life
– Awards: Fellow, ASQ
Past president of ASQ
– Books: Quality Is Free: The Art of Making Quality Certain (1979)
Quality Without Tears: The Art of Hassle - Free
Management (1984)
Running Things
The Eternally Successful Organization (1988)
The Art of Getting Your Own Sweet Way (1981)
Quality is Still Free: Making Quality Certain in Uncertain
Times (1996)
• Statement: Quality is conformance to requirements
Dr. Daming Zhang
IT 117 – Quality Assurance
16
Abstract
• Philip Crosby was one of the first corporate VP's in quality
in the country
• It was Philip Crosby's deep understanding of the concerns
of management that made him respected by top
management
• Crosby believed that quality was a significant part of the
company and senior managers must take charge of it
• He believed the quality professional must become more
knowledgeable and communicative about the business
• Crosby stated that corporate management must make the
cost of quality a part of the financial system of their
company
Dr. Daming Zhang
IT 117 – Quality Assurance
17
Crosby's Message (1)
• Crosby's name was best known in relationship to the
concepts of "Do It Right First Time" and "Zero Defects“
• He considered traditional quality control, acceptable
quality limits and waivers of sub-standard products to
represent failure rather than assurance of success
• Crosby defined quality as conformance to the requirements
which the company itself had established for its products
based directly on its customers' needs
• Manufacturing companies spent around 20% of their
revenues doing things wrong, and 35% of operating
expenses for service companies
• Workers should not take prime responsibility for poor
quality; responsibility resides with management
Dr. Daming Zhang
IT 117 – Quality Assurance
18
Crosby's Message (2)
• In the Crosby approach, the Quality Improvement message
is spread by creating a core of quality specialists within the
company
• There is strong emphasis on the top-down approach, since
he believed that senior management was entirely
responsible for quality
• The ultimate goal is to train all the staff and give them the
tools for quality improvement and to apply the basic
precept of Prevention Management in every area
• Crosby's Quality Improvement Process was based upon the
four absolutes of quality management
Dr. Daming Zhang
IT 117 – Quality Assurance
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Crosby’s Four Absolutes
• Managers have to get serious about prevention
• Everyone in the company has to understand quality the
same way
• Management must know and practice the "Four Absolutes
of Quality Management":
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Quality means conformance to requirements
Quality comes from prevention
Quality performance standard is Zero Defects (or defect-free)
Quality measurement is the price of nonconformance
• The four absolutes of quality management are basic
requirements to understanding the purpose of a quality
system
Dr. Daming Zhang
IT 117 – Quality Assurance
20
Crosby's 14 Steps to Quality Improvement
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Step 1. Management commitment
Step 2. The quality improvement team
Step 3. Measurement
Step 4. The cost of quality
Step 5. Quality awareness
Step 6. Corrective action
Step 7. Zero defects (ZD) planning
Step 8. Employee education
Step 9. ZD day
Step 10. Goal setting
Step 11. Error cause removal
Step 12. Recognition of good work in the quality process
Step 13. Establish Quality Councils
Step 14. Repetition
Dr. Daming Zhang
IT 117 – Quality Assurance
21
Crosby’s Comments
• Permanent improvement requires three phases:
– The conviction by senior managers that they have had enough of
quality being a problem and want to turn it into an asset
– The commitment that they will understand and implement the
Four Absolutes of Quality Management
– The conversion to this way of thinking on a permanent basis
• The key things to remember are:
– People will take quality just as seriously as management takes it
– Integrity is unrelenting: it can't be done in short bursts of
enthusiasm stemming from regret
– The tools of quality control are not designed to cause prevention
– Think about quality improvement in terms of earnings per share
– Every individual in the company needs continual education
concerning his/her role in getting things done right the first time
Dr. Daming Zhang
IT 117 – Quality Assurance
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IT 117 – Quality Assurance
Unit 04 – Benefits & Philosophies 2
Instructor:
Daming Zhang, Ph.D.
Professor
Department of Industrial Technology
California State University, Fresno
Dr. Daming Zhang
IT 117 – Quality Assurance
1
Quality Benefits and Philosophies
• Quality Benefits and Philosophies is presented in the
following topic areas:
– Benefits of quality
– Quality philosophies
Dr. Daming Zhang
IT 117 – Quality Assurance
2
Dr. W. Edwards Deming (1900 - 1993)
• Education:
BS, University of Wyoming; MS, University
of Colorado; PhD, Physics, Yale
• Awards:
Shewhart Medal, ASQ, 1955
2nd Order Medal of the Sacred Treasure,
first American, 1960
Honorary Member, ASQ, 1970
Numerous other awards
• Books: Over 200 papers, articles, and books including:
Quality, Productivity, and Competitive
Position
Out of the Crisis (Deming, 1986)
• Statement: He was the founder of the third wave of the
industrial revolution
Dr. Daming Zhang
IT 117 – Quality Assurance
3
Abstract
• W. Edwards Deming is the one individual whose name
stands for quality and what it means
• He is a national folk hero in Japan and perhaps the leading
speaker for the quality revolution in the world
• He developed a fondness for the Japanese people during
1946 to 1948
• JUSE (Japanese Union of Scientists and Engineers) invited
Deming back in 1950 for executive courses in statistical
methods
• He refused royalties on his seminar materials and insisted
that the proceeds be used to help the Japanese people
• JUSE named their ultimate quality prize after him
Dr. Daming Zhang
IT 117 – Quality Assurance
4
The Fourteen Obligations of Top Management
1. Create constancy of purpose toward improvement of product and
service
2. Adopt the new philosophy
3. Cease dependence on inspection to achieve quality
4. End the practice of awarding business on the basis of price tag
5. Improve constantly and forever the system of production and service
6. Institute training on the job
7. Institute leadership
8. Drive out fear, so that everyone may work effectively for the company
9. Break down barriers between departments
10. Eliminate slogans, exhortations, and targets for the work force
11. Eliminate work standards (quotas) on the factory floor
12. Remove barriers to pride of workmanship
13. Institute a vigorous program of education and self-improvement
14. Put everybody in the company to work to accomplish transformation
Dr. Daming Zhang
IT 117 – Quality Assurance
5
Seven Deadly Diseases That Management Must Cure
1. Lack of constancy of purpose
2. Emphasis on short-term profits
3. Evaluation by performance, merit rating, or annual review
of performance
4. Mobility of management
5. Running a company on visible figures alone
6. Excessive medical costs
7. Excessive warranty costs
• Diseases 6 and 7 are pertinent only to the United States
Dr. Daming Zhang
IT 117 – Quality Assurance
6
Deming Identified Some Obstacles (1)
• Expectation of quick results without effort and without
sufficient education
• Supposition that solving problems, automation, gadgets,
and new machinery will transform industry
• The search for examples and try to copy
• "Our problems are different” as an excuse
• Obsolescence in schools
• Poor teaching of statistical methods in industry
• Use of Military Standard 105D and other tables for
acceptance
• Reliance on quality control departments
• Blaming the work force for problems
Dr. Daming Zhang
IT 117 – Quality Assurance
7
Deming Identified Some Obstacles (2)
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False starts
"We installed quality control"
The unmanned computer
The supposition that it is only necessary to meet
specifications
• The fallacy of zero defects
• Inadequate testing of prototypes
• "Anyone that comes to try to help us must understand all
about our business"
Dr. Daming Zhang
IT 117 – Quality Assurance
8
Parable of the Red Beads
• Even with identical methods and tools, there will be
variation in results
• Any process has a built-in capability that is determined by
the way it is set up, not by a particular worker’s actions
• Real improvements to a process come from addressing the
underlying way the process is set up
• Management’s job is to work “on” the process, to change
the process design so the process works better
Dr. Daming Zhang
IT 117 – Quality Assurance
9
The 94% - 6% Rule
• Confusion between common causes and special causes
leads to frustration of everyone, and leads to greater
variability and to higher costs
• Most troubles and most possibilities for improvement add
up to proportions something like this:
94% belong to the system (responsibility of management)
6% special
• In the American style of management, when something
goes wrong the response is to look around for someone to
blame or punish or to search for something to "fix“ rather
than to look to the system as a whole for improvement
Dr. Daming Zhang
IT 117 – Quality Assurance
10
Know Thy Customer
• American managers have yet to grasp that they must satisfy
customer needs
• External customer: is the end user of a product or service
• Internal customer: is the person or work unit that receives
the product or the service of another within the same
company
• The notion of internal customers lends relevance to each
employee's job and is critical
Dr. Daming Zhang
IT 117 – Quality Assurance
11
The PDCA/PDSA Cycle
• Continuous or never-ending improvement requires instead
a circular approach
• Actually, the circle or cycle should
become a helix, by spiraling upward
towards continually higher
performance levels
• Dr. Deming called it the Shewhart Cycle
Plan-Do-Check-Act Cycle
Japanese call it the "Deming Cycle”
• The PDCA Cycle represents work on processes rather than
specific tasks or problems
• Processes can never be solved but only improved
Dr. Daming Zhang
IT 117 – Quality Assurance
12
Deming's Chain Reaction
• Improve quality Decrease costs (less rework, fewer
delays) Productivity Improves Capture the market with
better quality and price Stay in business Provide jobs
• As the above sequence is occurring, the marketplace is
responding to the firm:
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The customer obtains reduced prices
There is increased cooperation
New products and services are provided to the customers
There are higher levels of customer satisfaction
There is reduction of competition for share of the market
• Thus, a "chain reaction" of good things can occur through
the Deming philosophy
Dr. Daming Zhang
IT 117 – Quality Assurance
13
Dr. Joseph M. Juran (1904 - 2008)
• Education: BS, University of Minnesota; JD, Loyola
University; Numerous Honorary
Doctorates of Science, Engineering and Law
• Awards: Edwards Medal, ASQ; Brumbaugh Awards, ASQ
Grant Awards, ASQ; Honorary Member, ASQ
Second Order Medal of the Sacred Treasure, 1981
Plus over 30 other Medals
• Books:
Over 15 books, and more than 40 videotapes
Juran's Quality Handbook, 5th ed. (1999)
Quality Planning & Analysis (1993)
Juran on Quality by Design (1992)
Juran on Planning for Quality (1988)
• Statement: Adopt a revolutionary rate of improvement
in quality, making quality improvements by the thousands,
year after year
Dr. Daming Zhang
IT 117 – Quality Assurance
14
Abstract
• J.M. Juran started in quality after his graduation from
engineering school with an inspection position at Western
Electric's Hawthorne plant in Chicago in 1924
• He left Western Electric to begin a career in research,
lecturing, consulting, and writing that has lasted over 50
years
• The publication of his book Quality Control Handbook and
his work in quality management led to an invitation from
JUSE in 1954
• Juran's first lectures in Japan were to the 140 largest
company CEOs, and later to 150 senior managers
• His visit thus marked Japan's use of quality control (QC) as
a management, rather than a specialist, technique
Dr. Daming Zhang
IT 117 – Quality Assurance
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Juran's basics for success
• Juran's basics for success can be described as follows:
– Top management must commit the time and resources for
success. CEOs must serve on the quality council
– Specific quality improvement goals must be in the business plan
and include:
• The means to measure quality results against goals
• A review of results against goals
• A reward for superior quality performance
– The responsibility for improvements must be assigned to
individuals
– People must be trained for quality management and improvement
– The workforce must be empowered to participate in the
improvement process
Dr. Daming Zhang
IT 117 – Quality Assurance
16
Juran’s Formula for Obtaining Results
• J.M. Juran has a prime basic belief that quality in America is
improving, but it must be improved at a revolutionary rate
• Quality improvements need to be made by the thousands,
year after year
• Juran (1988) states that "The recipe for action should
consist of 90% substance and 10% exhortation, not the
reverse”
• His formula for obtaining results is to:
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Establish specific goals to be reached
Establish plans for reaching the goals
Assign clear responsibility for meeting the goals
Base the rewards on results achieved
Dr. Daming Zhang
IT 117 – Quality Assurance
17
Juran's Quality Trilogy (1)
• The three quality processes of The Juran Trilogy are
interrelated, each one providing a structured method for
achieving specific quality objectives:
• Quality planning designs new goods and services. It
ensures that the right set of service features is delivered to
the appropriate customers and that service deficiencies are
kept to a minimum
• Quality control ensures that the results of the first two
processes are sustained over time
• Quality improvement reduces deficiencies in existing
goods, services, or processes. Reaching this new level of
performance is frequently referred to as breakthrough
Dr. Daming Zhang
IT 117 – Quality Assurance
18
Juran's Quality Trilogy (2)
• The graph below illustrates The Juran Trilogy, using the data
of a hypothetical organization
Dr. Daming Zhang
IT 117 – Quality Assurance
19
The Quality Planning Process
• Today's quality planning model emphasizes customer needs
and teamwork
• It provides a structure for ensuring customer satisfaction by
identifying the best combination of features and keeping
defects to a minimum
• This approach can achieve
first-time results with
deficiencies significantly
lower than the 20 to 40
percent rate resulting from
most traditional planning
Dr. Daming Zhang
IT 117 – Quality Assurance
20
The Six Steps of Quality Planning
• Verify the Goal: The goal describes the expected results of
the planned product or service
• Identify Customers: All the important customers (both
internal and external) are identified
• Determine Customer Needs: The focus is on finding the
benefits the customer wants
• Develop Product: The services and goods must meet
customer needs and be technically sound
• Develop the Process: that will create and deliver goods or
services exactly as designed
• Transfer to Operations: involves formal, careful transfer of
the process to those who will ultimately manage delivery to
the customer
Dr. Daming Zhang
IT 117 – Quality Assurance
21
Quality Control Feedback Loop
• Quality control relies on a feedback loop, which can be
illustrated as follows:
• Quality control holds the gains once a quality improvement
has been made
Dr. Daming Zhang
IT 117 – Quality Assurance
22
Quality Improvement
• The quality improvement process is designed to reduce or
eliminate the chronic waste associated with ongoing
deficiencies
• There are many processes in an organization that do not
meet the performance levels expected by customers and
staff
• The following are typical quality improvement projects:
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Reduce the number of defects in a product
Reduce the design cycle time for new services
Minimize errors in invoices
Reduce set-up times of machines
Dr. Daming Zhang
IT 117 – Quality Assurance
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Six Steps of Quality Improvement
• Identify a Project: Pareto diagram is very useful in selecting
improvement candidates
• Establish the Project: The deficiency to be attacked must be
clearly specified and the expected improvement defined in
measurable terms
• Diagnose the Cause: The team uncovers the root cause (or
causes) of the deficiency
• Remedy the Cause: produce optimal results for both the
organization and the customer
• Hold the Gains: All work goes into correcting a deficiency
can be lost if there are no effective controls in place
• Replicate Results and Nominate New Projects
Dr. Daming Zhang
IT 117 – Quality Assurance
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Juran's Quality Trilogy Detail
• The following Table outlines the major points of Dr. Juran's
Quality Trilogy:
Dr. Daming Zhang
IT 117 – Quality Assurance
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Deming, Juran, and Crosby Comparison (1)
• Crosby, Deming, and Juran all define quality in the same
terms, albeit from different perspectives:
– Deming – the Consumer's Perspective
– Juran – the Manufacturer's Perspective
– Crosby – the Management Perspective
• Each is focusing on his own field of expertise:
Deming as a statistician, Juran as an engineer, and Crosby
as a manager
• All of them insist on the customer being the final arbiter of
what quality is or is not
• All three insist on there being some tangible definition of
quality, though with varying degrees of rigor
• All three see the importance of feedback
Dr. Daming Zhang
IT 117 – Quality Assurance
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Deming, Juran, and Crosby Comparison (2)
Dr. Daming Zhang
IT 117 – Quality Assurance
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Dr. Walter A. Shewhart (1891 - 1967)
• Education: BS, MS, University of Illinois; Ph.D. in Physics,
University of California;
• Awards: Holley Medal, ASME; Honorary Fellowship of the Royal
Statistical Society; First Honorary Member of American
Society for Quality; Honorary Professor of Statistical
Quality Control, Rutgers University; The Shewhart Medal
is awarded in his honor
• Books:
Economic Control of Quality of Manufactured Product
(1931); Statistical Method from the Viewpoint of Quality
Control (1939); Published a series of articles in Bell
System Technical Journal
• Statement: Dr. Shewhart framed the problem in terms
of "assignable-cause" and "chance-cause" variation;
Dr. Shewhart’s statistical process control charts have
become a quality legacy that continues today
Dr. Daming Zhang
IT 117 – Quality Assurance
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Dr. Kaoru Ishikawa (1915 - 1989)
• Education: B.S. in Chemistry and Doctorate of Engineering from the
University of Tokyo;
• Awards: Deming Prize (1952); Nihon Keizai Press Prize; Industrial
Standardization Prize; Grant Award (ASQ); Shewhart
Medal (ASQ); Honorary Member, ASQ (1986)
In 1993, ASQ established the Ishikawa Award
• Books:
Guide to Quality Control (1982); What is Total Quality
Control? The Japanese Way (Ishikawa, 1985); Authored
the first Japanese book to define the word "TQC" in 1981
• Statement: Dr. Ishikawa called the Japanese-style quality
control method the companywide quality control(CWQC);
Ishikawa also originated the concept: "Next operation
as customer“ in 1950;
The fishbone diagram is also called the Ishikawa diagram
in his honor.
Dr. Daming Zhang
IT 117 – Quality Assurance
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