Nigel Slack et al. Operations Management - 7th Edition - Detailed Chapters Contents

Operations Management - Summaries - Chapters, Topics, Sub-Sections,Concepts

https://nraomtr.blogspot.com/2019/03/operations-management-summaries.html

Operations Management - Important Points for Quick Revision

https://nraomtr.blogspot.com/2019/03/operations-management-important-points.html

Management Definition – Narayana Rao

https://nraomtr.blogspot.com/2018/01/management-definition-narayana-rao.html

 Nigel Slack et al. Operations Management - 7th Edition - Detailed Chapters Contents

 Part 1

 INTRODUCTION 3

 Chapter 1   Operations management 4

 Introduction 4

 What is operations management? 6 

 Operations management is important in all types of organization 8 

 The input–transformation–output process 13 

 The process hierarchy 18 

 Operations processes have different characteristics 23 

 What do operations managers do? 26 

 Summary answers to key questions 30

 Case study: Design house partnerships at Concept Design Services 31

 Problems and applications 34

 Selected further reading 34

 Useful websites 35

https://nraomtr.blogspot.com/2014/10/introduction-to-operations-management.html

Industrial Engineering and Operations Management - Distinction and Combination

https://nraomtr.blogspot.com/2019/04/industrial-engineering-and-operations.html

AIIE

“Industrial engineering is concerned with the design, improvement, and installation of integrated systems of men, materials, and equipment. It draws upon specialized knowledge and skill in the mathematical, physical, and social sciences together with the principles and methods of engineering analysis and design, to specify, predict, and evaluate the results to be obtained from such systems.” (AIIE, 1955). [4]

AIIE (Revised)

"Industrial engineering is concerned with the design, improvement and installation of integrated systems of people, materials, information, equipment and energy. It draws upon specialized knowledge and skill in the mathematical, physical, and social sciences together with the principles and methods of engineering analysis and design, to specify, predict, and evaluate the results to be obtained from such systems." [7]

Narayana Rao (2017)

Industrial engineering is  system efficiency engineering.

http://nraoiekc.blogspot.com/2012/02/industrial-engineering-definitions-1911.html

Top 1% of Publications on Academia.Edu  

INTRODUCTION TO MODERN INDUSTRIAL ENGINEERING by Narayana Rao Kvss.

121 Pages. Free Download.    

https://www.academia.edu/103626052/INTRODUCTION_TO_MODERN_INDUSTRIAL_ENGINEERING_Version_3_0

 Chapter 2    Operations performance 36

 Introduction 36

 Operations performance is vital for any organization 38 

 Why is quality important? 46 

 Why is speed important? 47 

 Why is dependability important? 49

 Why is flexibility important? 52 

 Why is cost important? 55 

 Trade-offs between performance objectives 60 

 Summary answers to key questions 62

 Case study: Operations objectives at the 

Penang Mutiara 64

 Problems and applications 65

 Selected further reading 66

 Useful websites 67

What is Operational Excellence in Manufacturing and Supply Chain?

https://nraomtr.blogspot.com/2015/03/what-is-operational-excellence-in.html

KPIs

Procurement KPIs : Accuracy, Operational, Supplier and Financial level Procurement Key performance indicators

https://engineeringwithmanagement.com/procurement-key-performance-indicators/

Important Key Performance Indicators(KPIs) for Strategic Human Resource(HR) management

https://engineeringwithmanagement.com/important-key-performance-indicatorskpis-for-strategic-human-resourcehr-management/

Analytics-Based Enterprise Performance Management (EPM)

https://nraoiekc.blogspot.com/2023/06/analytics-based-enterprise-performance.html

Webinar on 18 June 2023

Registration link

https://us06web.zoom.us/webinar/register/WN_dIsZXphETZ-a8szRiVS_kQ#/registration

 Chapter 3   Operations strategy 68

 Introduction 68

 What is strategy and what is operations strategy? 70 

 The ‘top-down’ and ‘bottom-up’ perspectives 73 

 The market requirements and operations resources perspectives 77 

 How can an operations strategy be put together? 86 

 Summary answers to key questions 89

 Case study: Long Ridge Gliding Club 91

 Problems and applications 92

 Selected further reading 93

 Useful websites 93

https://nraomtr.blogspot.com/2023/06/operations-strategy-nigel-slack-et-al.html

Part 2

DESIGN 95

 Chapter 4   Process design 96

 Introduction 96

 What is process design? 97 

 What objectives should process design have? 98 

 Process types – the volume–variety effect on process design 101 

 Detailed process design 109 

 Summary answers to key questions 120

 Case study: The Action Response Applications Processing Unit (ARAPU) 121

 Problems and applications 123

 Selected further reading 124

 Useful websites 124

Process Design - A Note - Nigel Slack et al.

https://nraomtr.blogspot.com/2022/05/process-design-note-nigel-slack-et-al.html

Production Process Planning - Sub-Module of Process Industrial Engineering

https://nraoiekc.blogspot.com/2020/07/production-process-planning-sub-module.html

Process Strategy and Analysis - Important Points - Summary - Krajewski - 12th Edition

https://nraomtr.blogspot.com/2019/08/process-strategy-and-analysis-important.html

Product Design and Process Selection—Services - Review Notes

https://nraomtr.blogspot.com/2011/12/product-design-and-process.html

Little’s Law, a fundamental tool to define supply chain metrics

Sangdo (Sam) Choi

Harry F. Byrd, Jr. School of Business, Shenandoah University, Winchester, VA 22601, USA 

Abstract

We review Little's Law to define inventory turnover and other asset-turnovers. We relate Little's Law 

with EOQ model and turnovers. We suggest a new definition of cash-to-cash cycle for manufacturers, 

because the current one is for retailers. We analyze several industries using an earns-turns matrix based 

on Little's Law.

https://www.pomsmeetings.org/ConfProceedings/065/Full%20Papers/Final%20Full%20Papers/065-0142.pdf

Chapter 5  Innovation and design in services and products 125

Introduction 125

How does innovation impact on design? 127

Why is good design so important? 130

The stages of design – from concept to specification 131

What are the benefits of interactive design? 141

Summary answers to key questions 147

Case study: Chatsworth – the adventure playground decision 148

Problems and applications 150

Selected further reading 150

Useful websites 151

Design of Services and Products - Nigel Slack - Chapter Summary

https://nraomtr.blogspot.com/2023/07/design-of-services-and-products-nigel.html

Product Design and Process Selection—Services - Review Notes (Chase et al. Book)

https://nraomtr.blogspot.com/2011/12/product-design-and-process.html

Chapter 6 Supply network design 152

Introduction 152

The supply network perspective 153

Configuring the supply network 155

Where should an operation be located? 160

Long-term capacity management 168

Break-even analysis of capacity expansion 174

Summary answers to key questions 175

Case study: Disneyland Resort Paris (abridged) 176

Problems and applications 180

Selected further reading 182

Useful websites 182

Supplement to Chapter 6

Forecasting 183

Introduction 183

Forecasting – knowing the options 183

In essence forecasting is simple 184

Approaches to forecasting 185

Selected further reading 190

Chapter 7 Layout and flow 191

Introduction 191

What is layout? 193

The basic layout types 193

What type of layout should an operation choose? 200

How should each basic layout type be designed in detail? 204

Summary answers to key questions 217

Case study: North West Constructive Bank (abridged) 218

Problems and applications 220

Selected further reading 222

Useful websites 222

Chapter 8  Process technology 223

Introduction 223

Operations management and process technology 225

What do operations managers need to know about process technology? 225

How are process technologies evaluated? 237

How are process technologies implemented? 242

Summary answers to key questions 246

Case study: Rochem Ltd 247

Problems and applications 249

Selected further reading 249

Useful websites 250

IoT and Supply Chain Management

2017

https://www.researchgate.net/publication/321131587_Internet_of_things_and_supply_chain_management_a_literature_review/link/5e3fb9d892851c7f7f27ee14/download

Free Access

Good article

Introduction to the special issue on “Technology management in a global context: From enterprise systems to technology disrupting operations and supply chains”

Gregory R. Heim, Xiaosong (David) Peng

First published:  JOM,  21 September 2022 https://doi.org/10.1002/joom.1216

https://onlinelibrary.wiley.com/doi/full/10.1002/joom.1216

Chapter 9

People, jobs and organization 251

Introduction 251

People in operations 253

Human resource strategy 253

Organization design 256

Job design 259

Allocate work time 271

Summary answers to key questions 273

Case study: Service Adhesives try again 274

Problems and applications 276

Selected further reading 277

Useful websites 277

Supplement to Chapter 9

Work study 279

Introduction 279

Method study in job design 279

Work measurement in job design 282

https://nraomtr.blogspot.com/2023/06/people-jobs-and-organization-operations.html

Part Three

DELIVER – PLANNING AND CONTROLLING OPERATIONS 287

Chapter 10 The nature of planning and control 288

Introduction 288

What is planning and control? 290

The effect of supply and demand on 

planning and control 293

Planning and control activities 299

Controlling operations is not always routine 314

Summary answers to key questions 316

Case study: subText Studios, 

Singapore (abridged) 317

Problems and applications 320

Selected further reading 321

Useful websites 321

Chapter 11  Capacity management 322

Introduction 322

What is capacity management? 324

How is capacity measured? 326

Coping with demand fluctuation 334

How can operations plan their capacity level? 343

How is capacity planning a queuing problem? 348

Summary answers to key questions 353

Case study: Blackberry Hill Farm 354

Problems and applications 358

Selected further reading 360

Useful websites 360

Supplement to Chapter 11

Analytical Queuing Models 361

Introduction 361

Notation 361

Variability 361

Incorporating Little’s law 363

Types of queuing system 363

Chapter 12

Inventory management 368

Introduction 368

What is inventory? 370

Why should there be any inventory? 372

How much to order – the volume decision 376

When to place an order – the timing decision 388

How can inventory be controlled? 392

Summary answers to key questions 398

Case study: supplies4medics.com 400

Problems and applications 401

Selected further reading 402

Useful websites 402

Chapter 13

Supply chain management 404

Introduction 404

What is supply chain management? 406

The activities of supply chain management 409

Single- and multi-sourcing 413

Relationships between operations 

in a supply chain 419

How do supply chains behave in practice? 424

How can supply chains be improved? 426

Summary answers to key questions 433

Case study: Supplying fast fashion 434

Problems and applications 437

Selected further reading 438

Useful websites 438

Chapter 14

Enterprise resource planning (ERP) 439

Introduction 439

What is ERP? 440

How did ERP develop? 441

Implementation of ERP systems 449

Summary answers to key questions 451

Case study: Psycho Sports Ltd 452

Problems and applications 454

Selected further reading 455

Useful websites 455

Supplement to Chapter 14

Materials requirements planning (MRP) 456

Introduction 456

Master production schedule 456

The bill of materials (BOM) 458

Inventory records 459

The MRP netting process 459

MRP capacity checks 461

Summary 463

Chapter 15

Lean synchronization 464

Introduction 464

What is lean synchronization? 465

How does lean synchronization 

eliminate waste? 471

Lean synchronization applied throughout the supply network 484

Lean synchronization compared with other approaches 486

Summary answers to key questions 489

Case study: The National Tax Service (NTS) 490

Problems and applications 492

Selected further reading 493

Useful websites 494

Chapter 16

Project management 495

Introduction 495

What is project management? 497

How are projects planned and controlled? 500

What is network planning? 514

Summary answers to key questions 526

Case study: United Photonics Malaysia Sdn Bhd 527

Problems and applications 531

Selected further reading 532

Useful websites 533

Chapter 17 Quality management 534

Introduction 534

What is quality and why is it so important? 536

How can quality problems be diagnosed? 540

Conformance to specification 541

Achieving conformance to specification 541

Total quality management (TQM) 548

Summary answers to key questions 556

Case study: Turnround at the Preston plant 557

Problems and applications 559

Selected further reading 560

Useful websites 560

Supplement to Chapter 17

Statistical process control (SPC) 562

Introduction 562

Control charts 562

Variation in process quality 563

Control charts for attributes 568

Control chart for variables 569

Process control, learning and knowledge 573

Summary 574

Selected further reading 574

Useful websites 574

Part Four

IMPROVEMENT 577

Chapter 18  Operations improvement 578

Introduction 578

Why is improvement so important in operations management? 580

The key elements of operations  improvement 584

The broad approaches to managing improvement 588

What techniques can be used for improvement? 598

Summary answers to key questions 603

Case study: GCR Insurance 605

Problems and applications 608

Selected further reading 609

Useful websites 609

Chapter 19  Risk management 610

Introduction 610

What is risk management? 612

Assessing the potential causes of and 

risks from failure 613

Preventing failure 624

How can operations mitigate the effects of failure? 631

How can operations recover from the effects of failure? 632

Summary answers to key questions 635

Case study: Slagelse Industrial 

Services (SIS) 636

Problems and applications 638

Selected further reading 638

Useful websites 639

Chapter 20  Organizing for improvement 640

Introduction 640

Why the improvement effort needs organizing 642

Linking improvements to strategy 643

What information is needed for improvement? 645

What should be improvement priorities? 652

How can organizational culture affect improvement? 657

Key implementation issues 659

Summary answers to key questions 664

Case study: Re-inventing Singapore’s 

libraries 666

Problems and applications 667

Selected further reading 668

Useful websites 668

Part 5

CORPORATE SOCIAL  RESPONSIBILITY 671

Chapter 21  Operations and corporate social responsibility (CSR) 672

Introduction 672

What is corporate social responsibility? 674

The wider view of corporate social responsibility 679

How can operations managers analyse CSR issues? 686

Summary answers to key questions 689

Case study: CSR as it is presented 690

Problems and applications 691

Selected further reading 691

Useful websites 691

Notes on chapters 693

Glossary 700

Index 713

Sustainability

IJOPM Vol. 43, Issue 4, 2023: Speical Issue Applying operations and supply chain management theories in the circular economy context

https://www.linkedin.com/pulse/ijopm-vol-43-issue-4-2023-si-applying-operations/

Issue Link

https://www.emerald.com/insight/publication/issn/0144-3577/vol/43/iss/4

June - July - August 2023

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For links of slides of various chapters

Nigel Slack et al. Operations Management - 7th Edition - Detailed Chapters Contents

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Ud. 4.9.2024, 6.7.2023

Pun 29.6.2023

Systems Approach in Management

Business organizations are systems. Management of an organization can also be viewed as a system.

A system may be defined as an assemblage of objects or functions united by some interaction or interdependence. The action in one or of one causes a reaction in another.

Systems may be open loop or closed loop. In the closed-loop systems, there is a feedback of information to correct errors that are detected in output of the system. In the case of a production system, when defects are noticed by the inspectors, if the system is examined and adjusted, there is a closed loop system in operation. If simply, the rejected are thrown out and nothing else is done, the closed loop is not operating.   In management functions, control is the function that measures results and further plans are made in the light of plan-results gaps.

Also, systems can be open systems. Business organizations are open systems, they are part of industrial systems, which are parts of social systems

The effective manager must in a very real sense, be a scientific and creative designer of workable systems. Systems composed of subsystem which are run by various people and having relations. Any problem in one subsystem has an effect on other subsystem and therefore on the output of the whole system. If a task is achieved by people are made unhappy in the process, for the next task the system will be full of unhappy people who may not even listen to what the managers are saying.

Systems Thinking (Narayana Rao, 8.4.2022)

Systems thinking is the ability to find the weak element in the system that is responsible for the poor results from the system. Top down view should be able to assure that every element is designed properly and functioning properly.

Similarly, any change in any element has an effect on the system and from bottom up view, systems thinking should be able to figure it out.

When people do not have systems thinking ability they design elements wrongly and make changes to elements without understanding its impact on the system.

Kotler and Keller recommend system approach to marketing as one aspect of holistic marketing which they recommend as the appropriate concept for the 21st Century in their 14 Edition of Marketing Management.

Integrated Marketing

Entire marketing function or mix is to be treated as a system and each activity has an effect on other activities. Synergy can be created among the activities and the overall effect can be magnified when integrated marketing or systems thinking based marketing is practiced.

Management Systems

Based on Management Systems: A Viable Approach

by Maurice Yolles, 1999
Pub by Financial Times Pitman

Management can be argued as being concerned with inquiry and action.  Inquiry occurs through planning and by defining organisational mission, goals and manager aims. It subsequently results in action and involves the cybernetic processes of control and communications.

All strategies are influenced by worldviews of individuals and of groups. Each individual perceives the world in his own  way, that perception  determines how he responds to it. No doubt, the worldview is influenced by the socialization that starts with the family  and is further affected by experiences of each individual. Organizations also have unique worldviews. Worldviews are regarded as informal and are called weltanschauungen whether they belong to either an individual or a group. Some beliefs, values, attitudes, and concepts that are part of worldviews can be made more or less transparent to others. When this occurs we say that that they have been formalised, and turned into paradigms. Weltanschauungen are not transparent to others, and are informal. Worldviews are manifested as behaviour  which is a result of the interplay between weltanschauungen of those individuals or organisations and the paradigms around.

Management systems describe the process of management through the application of systems metaphors. It was initiated in the 1930s with the work of Barnard, where organisations are seen as cooperative systems. All managed organisations are seen as systems that share certain conceptual elements. These include input, process, output, and feedback. The inputs in the manufacturing firm, for instance, consist of raw materials, technical knowledge, labour, equipment, and financing, all of which are combined under managerial direction into a process that results in a finished output or product. The market acceptance of the product and resulting sales give a financial return (feedback) to the firm which reactivates the cycle. Low sales indicate that a change in the input or process is necessary to produce a more acceptable output. Through cycles such as these, organisations learn and maintain their existence.

Business systems are seen to be open to their environment. They import inputs, export outputs, and interpret the feedback they receive from the environment. What happens in the environment affects them, and as the environment changes, management must monitor the changes and adapt the organisation to the new situation.

 In the business systems, to achieve organisational goals, people must perform tasks, using technical knowledge and equipment, and they must work together in structured relationships. Human beings enter into social relationships, both formal (job-related) and informal (non-job-related) at the work place. The task of management is to coordinate all of these parts and plan future activities. It also involves decision-making and regulation of the organisational system. Managers are involved in planning, implementing, and controlling to achieve the set goals.

There are two important lessons for the manager in open systems theory of management. The first is that no organisation exists in a vacuum. The environment constrains what the manager can do, but it only offers opportunities and potentialities. Managers must be aware of and understand environmental events and trends because the organisation's well-being and even survival depend upon appropriate adaptation to change.

The second lesson of the systems approach is its stress on the interrelatedness of the parts of an organisation. Lower level managers  are often tempted to see organisational problems and activities in isolation. In an extreme case, a manager may concentrate upon the efficient functioning of his or her own department and give only secondary attention to its relationships with other parts of the organisation. Any neglect of important relationships results in some degree of inefficiency or effectiveness of the organization.

Open Systems Theory

An open system interacts with its environment. In particular, “with respect to its relations with the

environment, a system is called open that maintains exchanges with its environment - especially exchanges of matter, energy and information.

According to von Bertalanffy [1973] the theory of open systems represent generalisations of physical theory, kinetics, and thermodynamics, which led to new principles and insight. Negative feedback is one of these. It occurs when homeostatic maintenance of a characteristic state or goal is desired. It is based on circular causal chains and mechanisms monitoring and feeding back information on deviations from the state to be maintained or the goal to be achieved. Another is the idea of equifinity, where an open system has a tendency to move towards having final states that derive from different initial states and in different ways.

Adaptation is also seen as an important feature of open systems. Open systems theory recognises that systems are in dynamic relationship with their environment, and receive inputs that they transform in some way to create outputs. The open system is seen to adapt to its environment by responding to changes in the environment as well as response of environment to its output through changes in its form and processes. The open system is supposed to be in continuing interaction with its external environment and maintains homeostasis (desired state).

The terms used in Open Systems Theory

Inputs (resources): like raw materials, money, people (human resources), equipment, information, knowledge, legal authority from the environment for action.

Outputs: products, services, ideas as an outcome of organisational action; and organisation transfers its main outputs beck to the environment and uses others internally.

Technology: tools, machines, techniques for transforming recourses into outputs; techniques can be mental (e.g., exercising judgement) social, chemical, physical, mechanical, or electronic. Environment: the task environment includes all of the external organisations and conditions that are directly related to an organisation’s main operations and its technologies.

Goals and strategies: future states sought by the organisation’s dominant decision makers. Goals are desired end states, while objectives are specified targets and indicators of goal attainment. Strategies are overall routes to goals, including ways of dealing with the environment. Plans specify courses of action towards an end goal. Goals and strategies are the outcomes of conflict and negotiation among powerful parties within the outside organisation.

Behaviour and process: prevailing patterns of behaviour, interactions, and relations between groups and individuals - including corporations, conflict, coordination, communication, controlling and rewarding behaviour, influence and power relations, goal setting, information gathering, self-criticism, evaluation, group
learning.

Culture: shared norms, values, beliefs and assumptions, and the behaviour and artefacts that express these orientations - including symbols, rituals, stories, and language; norms and understanding about the nature and identity of the organisation, the way work is done, the value and possibility of changing or innovating, relations between lower and higher ranks, the nature of the environment.

Form: this is composed of structure - the enduring relations between individuals, groups, and larger units - including role assignments, grouping of positions in divisions/departments..., and process, such as standard operating procedures and human resource mechanisms.

The System Metaphor

A situation can be seen as a system if it can be associated with the accomplishment of some purpose. The system can be generically defined through the conceptualisation that is has:

1. a set of connected parts,
2. a complex whole,
3. a materially or immaterially organised body.

Purposefulness

Once a boundary has been created, we can refer to the space of rich interactions as the system domain, and that of the poor interactions as its external environment. A system may be said to be purposeful when it pursues actions that in some way relate to goals that represent purpose. Entities in the environment are seen to influence the system or its parts.

A business system takes inputs from the external environment, and in return provides it with outputs. It is thus seen as a transformer of inputs to outputs. The processes that occur to enable this are said to be purposive. The inputs are resources that may be both material or non-material and may include: raw materials, equipment, people, money, information, knowledge, and energy. The outputs may be material (like roducts), or non-material (like services).

A system can be seen as a whole with a set of parts that may be systems in their own right, when they are called subsystems. Thus the system domain will be part of the environment of the subsystem. This idea is recursive, so that subsystems can themselves have subsystems.

Within the bounds of a system, the parts form a richly interactive group that has been bounded together holistically through purpose. They are said to be synergistic. The concept of synergy means that the value of the parts of a system is greater when they work together cooperatively as a whole. As the level of cooperation reduces, so the parts begin to operate for their own independent purposes (in pursuit of their unrelated goals), and this may be contrary to the purposes of the system as a whole.

We can talk of primary and secondary purposes. For example, in dentistry, the primary purpose is patient dental health care with a secondary purpose of patient dental education. A purposeful system is task orientated through its actions. A primary task enables the primary purpose to be accomplished.

An Organised Body

A coherent situation can be modelled to have a form and as such will be seen to be
organised. An organised body is something which
:
(a) has an orderly structure
(b) has a working order,
(c) is organic.

An orderly structure occurs if the parts of a whole can be seen to have a relationship that has a meaning for the perceiver. Normally, this means that the structure has a purpose that the order is responsible for. If a coherent situation has a working order, then it is engaged in processes that occur according to some progression such that a purpose can be identified. If a coherent situation is organic, then it has a set of parts that are constituent of the whole and are coordinated within it. If an organic whole continues to exist, then coordination implies that there will be some control and communications processes at work that contribute to its continuance.

An alternative expression for an organised body is an organisation.  It may be worth noting at this point that in the literature there is some difference over the definition of organisation and structure. Social structure refers to fundamental social relationships seen to apply to: any ordered arrangement of distinguishable wholes [Frith, 1949] that represent the principles underlying social relations, and not the content. The nature of structures is that they set bounds on, or limit, possible courses of organisational action.  Thus, structure can be seen to be devoid of action, but is related to action. Action that involves the transformation of something is referred to as process, and we may therefore see that structure and process can be differentiated.

Organisation has both structures and processes. The organisation of a body has conditionality. Consider that a system is seen as a whole with a set of parts. Without constraint, any activities can occur in any of the parts, and each part can be seen as a space of potentially unlimited possible activities. But how does the purpose of the system get achieved. To achieve the purpose, the activities of parts have to limited and ti is done through the process of communication that occurs between the parts, that enables activities in one part to be related in some way to those of another and vice versa. Communication thus acts as an enabling mechanism for organisation that constrains the potential for activities in the parts so as to facilitate them to work together as whole. A whole is said to be richly connected when the parts are not easily reducible so that separate individual examination can occur without reference to the other parts. Conversely, poorly connected situations occur where the parts of the whole are highly reducible. In richly connected situations,  we would expect to find a great deal of communication.

Ashby introduces the idea that organisation can have quality by distinguishing between good and bad organisation in relativistic terms.  In defining good and bad, Ashby interprets the idea of Summerhoff
[1950] who explains that good and bad organisation is determined through: (a) the relationship between the a set of perturbations that disturbs the situation in some way, and (b) the perceived goals that the organisation is seen to be attempting to achieve. If the nature of the perturbations change, then the organisation is said to be good if it responds to the change, and bad if it does not.

Ashby has created a view of what constitutes a good or a bad organisation through a model that has become central to managerial cybernetics as it has to other fields of management theory. It has done this because it generates a satisfactory way of looking at them.  This view is consistent with much of the recent management theory literature in that it promotes the idea that it is through the institutionalisation of innovation [Drucker, 1985]  organisations have to respond to an uncertain and unpredictable environment. Innovation promotes survivability.





https://books.google.co.in/books/about/Systems_engineering.html?id=7c98AAAAIAAJ&redir_esc=y

A Systems Approach to Management
G. M. Jenkins and P. V. Youle
OR
Vol. 19, Special Conference Issue: Decision-Making (Apr., 1968), pp. 5-21
Published by: Operational Research Society


Systems approaches to management Michael Jackson
https://books.google.co.in/books?id=acfKyFOuxO8C&printsec=frontcover#v=onepage&q&f=false

The Basic Management Cycle: A Systems Approach to the Management Process
W.R. Allen
http://ceur-ws.org/Vol-72/003%20Allen%20Cycle.pdf



January Month Management Knowledge Revision Plan

MBA Core Management Knowledge - One Year Revision Schedule


Updated 3.9.2024,  8.4.2022,   21 Jan 2016,   17 Sep 2015, 10 Jan 2015

Synchronous Manufacturing and Theory of Constraints - Review Notes

Chase Aquilano Jacobs Book Chapter Review

Goal of the Firm

Performance Measurements


Unbalanced Capacity


Bottlenecks and Capacity-Constrained Resources


Basic Manufacturing Building Blocks

Methods for Control

Comparing Synchronous Manufacturing to MRP and JIT

Relationship with Other Functional Areas

Synchronous manufacturing refers to the entire production process working together in harmony to achieve the goals of the firm. Synchronous manufacturing logic attempts to coordinate all resources so that they work together and are in harmony or are "synchronized."  In synchronized manufacturing system, the measured  goals focus on total system performance, and not on localized measures such as labor or machine utilization.

Firms have to focus on three measures of the firm's ability to make money: net profit, return on investment, and cash flow. Financial measurements need to be used with other measures of throughput, inventory and operating expenses to help operations. The goal of the firm from an operations standpoint is to increase throughput while simultaneously reducing inventory and reducing operating expenses. Productivity is all the actions that bring a company closer to its goals.

Unbalanced capacity is preferable to an attempt to match capacity with market demand. Capacity constrained resources can become bottlenecks if their utilization is not scheduled carefully. Because each step in a process sequence is a dependent event, the ability to do the next process is dependent on the preceding one. Statistical fluctuations are the normal variations about a mean or average. Rather than balancing capacities, the flow of product through the system should be balanced.

A bottleneck is any resource whose capacity is less than the demand placed upon it. It limits the throughput.  A capacity-constrained resource (CCR) is one whose utilization must be scheduled carefully so it does not become a bottleneck operation.

Production cycle time is made up of setup time, process time, queue time, wait time, and idle time. Queue time is the greatest for parts waiting to go through a bottleneck. An hour saved at the bottleneck adds an extra hour to the entire production system but an hour saved at a nonbottleneck is a mirage and only adds an hour to its idle time. The important point to note here is that one has to develop a plan for saving time at non-bottleneck work stations, but implement them only when necessary.

Batch size determination is important in synchronous manufacturing. For bottleneck resources, larger batch sizes are desirable. For nonbottleneck resources, smaller process batch sizes are desirable and reduce work-in-process inventory.

MRP and JIT are often compared to synchronous manufacturing. MRP uses backward scheduling after being given a master production schedule while synchronous manufacturing uses forward scheduling because it focuses on the critical resources. JIT like synchronous manufacturing does an excellent job in reducing lead times and work in process but is limited to repetitive manufacturing and requires a stable production level.

The production system must work closely with the other functional areas to achieve the best operating system. Cost accounting, for example, is changing to support production performance measures. Marketing communicates and conducts activities in close harmony with production for better operations too. The firm should operate as a synchronized system with all parts in harmony and supporting each other. The key to competitive advantage through operations is for the firm to operate as a synchronized system, with all parts working in concert. Companies that do this well are well on their way to achieving the fundamental goal of the firm -- profitability.

Topics covered in the chapter

Synchronous Manufacturing Defined

Goal of the Firm

Performance Measurements
Financial Measurements
Operational Measurements
Throughput Defined
Inventory Defined
Operating Expenses Defined
Productivity
Productivity Defined

Unbalanced Capacity
Dependent Events and Statistical Fluctuations

Bottlenecks and Capacity-Constrained Resources
Bottleneck Defined
Nonbottleneck Defined
Capacity-constrained Resource (CCR) Defined

Basic Manufacturing Building Blocks

Methods for Control
Time Components
Finding the Bottleneck
Saving Time
Avoid Changing a Nonbottleneck into a Bottleneck
Drum, Buffer Rope
Importance of Quality
Batch Sizes
How to Treat Inventory

Comparing Synchronous Manufacturing to MRP and JIT

Relationship with Other Functional Areas
Accounting's Influence
Marketing and Production
Case: Solve the OPT Quiz—A Challenge in Scheduling

Source

http://highered.mcgraw-hill.com/sites/0072983906/student_view0/chapter18/

Operations and Supply Chain Management, Global edition

11th Edition

F. Robert Jacobs, Richard Chase

McGraw Hill, 2011 - Business & Economics - 802 pages

https://books.google.co.in/books?id=2sovEAAAQBAJ

Goldratts Rules 

Do not balance capacity balance the flow.

The level utilization of a nonbottleneck resource is not determined by its own potential but by

some other constraint in the system.

An hour lost at a bottleneck is an hour lost for the entire system.

Bottlenecks govern both throughput and inventory in the system.

Transfer batch may not and many times should not be equal to the process batch.

A process batch should be variable both along its route and in time.

Priorities can be set only by examining the systems constraints. Lead time is a derivative of the schedule.

Performance Measurement - Operational

1. Throughput

2. Inventory

3. Operating expenses

Performance Measurement - Financial

Net profit

Return on investment

Cash flow

Capacity Related Terminology

Capacity is the available time for production.

Bottleneck facility or resources  happens if capacity is less than demand placed on resource.

Nonbottleneck facility or resources is a resource for which  capacity is greater than demand placed on resource.

Capacity-constrained resource (CCR) is a resource where the capacity is close to demand placed on

the resource.

Time Components of Production Cycle

Setup time is the time that a part spends waiting for a resource to be set up to work on this same

part.

Process time is the time that the part is being processed.

Queue time is the time that a part waits for a resource while the resource is busy with something else.

Wait time is the time that a part waits not for a resource but for another part so that they can be

assembled together.

Idle time is the unused time. It represents the cycle time less the sum of the setup time, processing time, queue time, and wait time.

Inventory Cost Measurement - Dollar Days

Dollar Days is a measurement of the value of inventory and the time it stays within an area.

Ud  2.9.2024,  12.5.2022

Pub 10.12.2011

Costing for Quality, Time and the Theory of Constraints

Cost Accounting and Cost Measurement for Poor Quality Related Costs

Companies that fail to achieve quality at design level to provide as per customer requirement will fail in the market place. Also if the production system is unable to produce as per the design specification, spoilage will occur, rework will occur and failure of the product at the customer's place occurs sooner than expected.  Failure at the customer's end results in customer dissatisfaction, return of the product for repairs and bad word of mouth for the brand. Rework results in extra costs of production. Spoilage is also a loss due to material loss, labor loss and overhead loss associated with the spoilage. As the costs of poor quality are understood and quality improvement methods have evolved, accounting for poor quality related costs also emerged.

Cost of quality framework

Cost of quality framework states that quality can be improved by improving design and production processes and this will reduce appraisal costs, internal failure costs and external failure costs. Also increase in appraisal cost has the potential to reduce internal and external failure costs. To see this phenomenon in practical real life situations, cost accountants are being asked to prepare poor cost of quality statements showing the amount spent on each category of the following costs.

Prevention costs

Appraisal costs

Internal failure costs

External failure costs

Then quality managers and engineers or industrial engineers can come out with plans to increase prevention costs and appraisal costs and decrease internal and external failure costs. Needless to say engineering or managerial economics requires that incremental cost incurred must be less than the benefit realized that is decrease in total failure costs.

Cost accountants have to take the cost of quality categories as cost objectives and provide cost figures for them.


Seven Step Activity Based Costing for Determining Cost of Quality


1. Identify the Cost Objects - Concerned product, total cost of quality, individual category of cost of quality

2. Identify Direct Costs - There are no direct costs related to cost of quality

3. Select the Cost Allocation Bases to Use for Allocating Indirect Costs of the Product - For quality related work design hour, inspection hour, rework hour, were taken as cost allocation bases. In the case of external failure there is cost of transporting the item back to the company. For this a transport event is taken as the cost allocation base.

4. Identify the Indirect Costs Associated with Each Cost Allocation Base - Total cost incurred in product design, process design, inspection, rework due to internal and external failure, transport of customer returns are accumulated.

5. Compute the Rate Per Unit of Each Cost Allocation Base - For each activity, total quantity of performance (cost allocation base) is determined and it is used to divide total cost incurred to get the rate per unit of each cost allocation base,

6. Compute the Indirect Allocated to the Product - Compute the quantities of each cost allocation base related to poor quality used by the product.  Multiplying quantity with the corresponding rate per unit of the collection base will give the indirect to be allocated to the product for that allocation base.

7. Compute the Total Cost of the Cost Object: In our case of cost of quality is the cost object and we add all items of cost of quality framework to get total cost of quality.


Nonfinancial Measures of Quality

Nonfinancial measures are also important and their importance is brought into limelight by the balanced score card approach, Cost and management accountants have also a role to play in recording data of nonfinancial measures and creating statements of these measures.

Nonfinancial measures of customer satisfaction as index of quality

1. Market research studies on customer preference and satisfaction with specific products and product features.
2. The number of defective units reported by customers as a percentage of products shipped.
3. The number of customer complaints in a period say a month
4. Percentage of products that experience a early or excessive failure
5. Delivery delays - Percentages - Highest number of days
6. On-time delivery rate



Reference
Horngren, Foster, Datar,  Cost Accounting: A Managerial Emphasis, 10th Edition, Prentice Hall Inc., 2010


Updated2.9.2024,  3 May 2017, 6 May 2015
First Published 8 December 2011

Quality Engineering and Management (Product and Process) - Quotes from Juran's Quality Handbook

This is my #AtoZchallenge  Roadtrip Post. It is an important topic and by reading the handbook and collecting excerpts, I learnt this important subject of quality in more depth. Juran is one of the three celebrated quality management gurus. The others two are Crosby and Deming.

 #AtoZchallenge bloggers can indicate their Roadtrip Post in the file included in A to Z Challenge Site post. http://www.a-to-zchallenge.com/2022/05/the-2022-post-to-z-challenge-road-trip.html  You will get support from A to Z Challenge Bloggers for more views and comments. Visit the post and enter your blog details.

Levels of  Industrial Engineering (Productivity Improvement) in an Enterprise -  Enterprise Level to Engineering Element Level Industrial Engineering

Process Quality Improvement is more popularly understood as Productivity Improvement - J.M. Juran

Process quality improvement by a specialist foreman termed inspector was recommended by F.W. Taylor as part of functional supervision plan.

There are three principal dimensions for measuring process quality: effectiveness, efficiency, and

adaptability. The process is effective if the output meets customer needs. It is efficient when it is

effective at the least cost. The process is adaptable when it remains effective and efficient in the face

of the many changes that occur over time.

Industrial Engineering Strategy - Enterprise Level Industrial Engineering

https://nraoiekc.blogspot.com/2014/11/industrial-engineering-strategy.html

Facilities Industrial Engineering

https://nraoiekc.blogspot.com/2020/05/facilities-industrial-engineering.html

Process Industrial Engineering - Process Machine Effort Industrial Engineering - Process Human Effort Industrial Engineering.

https://nraoiekc.blogspot.com/2021/11/process-industrial-engineering-process.html

Operation Industrial Engineering.

https://nraoiekc.blogspot.com/2013/11/approach-to-operation-analysis-as-step.html

Element Level Analysis in Industrial Engineering

Taylor's Industrial Engineering System - First Proposal 1895 - Productivity Improvement of Each Element of the Process

Engineers and Engineering supervisors have to contribute to Quality engineering in their organizations.

Quotes from Quality Handbook, 5 Edition,  Dr. J.M. Juran

In the preface to the Fourth Edition of this handbook, Dr. Juran commented on the events of the four decades between signing the contract for the First Edition of this handbook (1945) and the publication of the Fourth Edition (1988).

The main impetus for the growing importance of quality in the past decade has been the realization of the critical role quality plays as the key to competitive success in the increasingly globalized business environment. Upper managers now understand much more clearly the importance of quality—convinced by the threat of the consequences of product failure, by the rapid shift of power to the buyers and by the demands of global competition in costs, performance, and service.

5th Edition special features

1. We have changed the name from Juran’s Quality Control Handbook, to Juran’s Quality Handbook. The new name signals the change in emphasis from quality control, traditionally the concern of those working on the manufacturing floor, to an emphasis on the management of quality generally, a concern of managers throughout an organization.

2. We have changed the structure to reflect the new emphasis on managing quality. The Fifth Edition has 48 sections, arranged in five groups: Managerial, Functional, Industry, International, and Statistical.

Chapters 1 to 17 deal with management issues.

Page 2.2.

The Meanings of “Quality.” Of the many meanings of the word “quality,” two are of critical importance to managing for quality:

1. “Quality” means those features of products which meet customer needs and thereby provide

customer satisfaction. In this sense, the meaning of quality is oriented to income. The purpose of

such higher quality is to provide greater customer satisfaction and, one hopes, to increase income.

However, providing more and/or better quality features usually requires an investment and hence

usually involves increases in costs. Higher quality in this sense usually “costs more.”

2. “Quality” means freedom from deficiencies—freedom from errors that require doing work

over again (rework) or that result in field failures, customer dissatisfaction, customer claims, and so

on. In this sense, the meaning of quality is oriented to costs, and higher quality usually “costs less.”

In the above one can be interpreted as product quality and 2 can be interpreted as process quality.

Page 2.5

Managing for quality makes extensive use of three such managerial processes:

● Quality planning

● Quality control

● Quality improvement

Page 2.12

The Factory System:  The goals of the factories were to raise productivity and reduce costs.  To reach their goals, the factories reengineered the manufacturing processes. Under the craft system, an artisan performed every one of the numerous tasks needed to produce the final product—pins, shoes, barrels, and so on. Under the factory system, the tasks within a craft were divided up among several or many factory workers. Special tools were designed to simplify each task down to a short time cycle. A worker then could, in a few hours, carry out enough cycles of his or her task to reach high productivity.

Adam Smith, in his book, The Wealth of Nations, was one of the first to publish an explanation of the striking difference between manufacture under the craft system versus the factory system. He noted that pin making had been a distinct craft, consisting of 18 separate tasks. When these tasks were divided among 10 factory workers, production rose to a per-worker equivalent of 4800 pins a day, which was orders of magnitude higher than would be achieved if each worker were to produce pins by performing all 18 tasks (Smith 1776). For other types of processes, such as spinning or weaving, power-driven machinery could outproduce hand artisans while employing semiskilled or unskilled workers to reduce labor costs. The broad economic result of the factory system was mass production at low costs. 

Page 2.13

The Taylor System of Scientific Management.  This originated in the late nineteenth century when Taylor, an American manager, wanted to increase production and productivity by improving manufacturing planning. His solution was to separate planning from execution. He brought in engineers to do the planning, leaving the shop supervisors and the work force with the narrow responsibility of carrying out the plans.

Taylor’s system was stunningly successful in raising productivity. It was widely adopted in the United States but not so widely adopted elsewhere. It had negative side effects in human relations, which most American managers chose to ignore. It also had negative effects on quality. The American managers responded by taking the inspectors out of the production departments and placing them in newly created inspection departments. In due course, these departments took on added functions to become the broad-based quality departments of today. (For elaboration, see Juran 1995, chap. 17.)

(I totally disagree with the above description by Juran.)

2.16

QUALITY TO CENTER STAGE

Except for Japan, the needed quality revolution did not start until very late in the twentieth century. To make this revolution effective throughout the world, economies will require many decades—the entire twenty-first century. Thus, while the twentieth century has been the “century of productivity,” the twenty-first century will be known as the “century of quality.”

2.17

Inventions Yet to Come. Many of the strategies adopted by the successful companies are

without precedent in industrial history. As such, they must be regarded as experimental. They did

achieve results for the role model companies, but they have yet to demonstrate that they can achieve

comparable results in a broader spectrum of industries and cultures. It is to be expected that the

efforts to make such adaptations will generate new inventions, new experiments, and new lessons

learned. There is no end in sight.

3.3

Quality Planning 

• Establish the project

• Identify the customers

• Discover the customer needs

• Develop the product

• Develop the process

• Develop the controls and transfer to operations

SECTION 4. THE QUALITY CONTROL PROCESS

J. M. Juran, A. Blanton Godfrey

4.2

 “Quality control” is a universal managerial process for conducting operations so as to provide stability—to prevent adverse change and to “maintain the status quo.”

To maintain stability, the quality control process evaluates actual performance, compares actual

performance to goals, and takes action on the difference.

The term “control of quality” emerged early in the twentieth century (Radford 1917, 1922). The

concept was to broaden the approach to achieving quality, from the then-prevailing after-the-fact

inspection, to what we now call “defect prevention.” For a few decades, the word “control” had a

broad meaning which included the concept of quality planning. Then came events which narrowed

the meaning of “quality control.” The “statistical quality control” movement gave the impression that

quality control consisted of using statistical methods. The “reliability” movement claimed that quality control applied only to quality at the time of test but not during service life.

 In Japan, the term “quality control” retains a broad meaning.

Their “total quality control” is roughly equivalent to our term “total quality management.” In 1997

the Union of Japanese Scientists and Engineers (JUSE) adopted the term total quality management

(TQM) to replace total quality control (TQC) to more closely align themselves with the more common terminology used in the rest of the world.

Quality assurance’s main purpose is to verify that control is being maintained.

A further common form of feedback loop involves office clerks or factory workers whose work

is reviewed by umpires in the form of inspectors. This design of a feedback loop is largely the

result of the Taylor system of separating planning from execution. The Taylor system emerged a century ago and contributed greatly to increasing productivity. However, the effect on quality control was negative.

(Once again I do not agree with the above statement. What Taylor did was to recommend multiple foremen organization in place of one foreman  in the military system. The system foreman and workers working under him was not initiated by Taylor. If the foreman is doing planning, Taylor suggested a foreman to take care of planning.)

Establish Standards of Performance: Product Goals and Process Goals. For each control subject it is necessary to establish a standard of performance—a quality goal (also called targets, objectives, etc.). A standard of performance is an aimed-at achievement toward which effort is expended.

The processes which produce products have two sets of quality goals:

1. To produce products which do meet customer needs. Ideally, each and every unit of product

should meet customer needs.

2. To operate in a stable and predictable manner. In the dialect of the quality specialist, each process

should be “under control.”

A study in one small company employing about 350 people found that there were over a billion

things to be controlled (Juran 1964, pp. 181–182).

There is no possibility for upper managers to control huge numbers of control subjects. Instead,

they divide up the work of control, using a plan of delegation somewhat as depicted in Figure 4.7.

This division of work establishes three areas of responsibility for control: control by nonhuman

means (automated controls), control by the work force, and control by the managerial hierarchy.

Planning for quality control of critical processes has traditionally been the responsibility of those

who plan the operating process. For noncritical processes the responsibility was usually assigned to

quality specialists from the Quality Department. Their draft plans were then submitted to the operating heads for approval.

Process Capability. One of the most important concepts in the quality planning process is

“process capability.” The prime application of this concept is during planning of the operating

processes.

Does the process conform to its quality goals? The umpire answers this question by interpreting the

observed difference between process performance and process goals. When current performance

does differ from the quality goals, the question arises: What is the cause of this difference?

Responsibility for results should, of course, be keyed to controllability. However, in the past

many managers were not aware of the extent of controllability as it prevailed at the worker level.

Studies conducted by Juran during the 1930s and 1940s showed that at the worker level the proportion of management-controllable to worker-controllable nonconformances was of the order of 80 to

20. These findings were confirmed by other studies during the 1950s and 1960s. That ratio of 80 to

20 helps to explain the failure of so many efforts to solve the companies’ quality problems solely by

motivating the work force.

(Do quality people appreciate Taylor when he said manager is responsible for 50% of the task's success)

Self-Inspection. We define “self-inspection” as a state in which decisions on the product are

delegated to the work force. The delegated decisions consist mainly of: Does product quality conform to the quality goals? What disposition is to be made of the product?

Note that self-inspection is very different from self-control, which involves decisions on the

process.

The merits of self-inspection are considerable:

SECTION 5

THE QUALITY IMPROVEMENT PROCESS

J. M. Juran

WHAT IS IMPROVEMENT?

 “Improvement” means “the organized creation of beneficial change; the attainment of

unprecedented levels of performance.” A synonym is “breakthrough.”

Two Kinds of Beneficial Change. Better quality is a form of beneficial change. It is applicable to both the kinds of quality.  

Product features: These can increase customer satisfaction. To the producing company, they are

income-oriented.

Freedom from deficiencies created in the production process: These can create customer dissatisfaction and chronic waste. To the producing company, they are cost-oriented.

Quality improvement to increase income may consist of such actions as

Product development to create new features that provide greater customer satisfaction and hence

may increase income.

Business process improvement to reduce the cycle time for providing better service to customers

Creation of “one-stop shopping” to reduce customer frustration over having to deal with multiple personnel to get service

Quality improvement to reduce deficiencies created by the production process that create chronic waste may consist of such actions as

Increase of the yield of factory processes

Reduction of the error rates in offices

Reduction of field failures

Quality improvement to increase income starts by setting new goals, such as new product features, shorter cycle times, and one-stop shopping. Meeting such new goals requires several kinds

of planning, including quality planning. 

In the case of chronic waste, the product goals are already in place; so are the processes for meeting those goals. However, the resulting products (goods and services) do not all meet the goals. Some

do and some do not. As a consequence, the approach to reducing chronic waste is different from the

quality planning roadmap. Instead, the approach consists of (1) discovering the causes—why do

some products meet the goal and others do not—and (2) applying remedies to remove the causes. 

Continuing improvement is needed for both kinds of quality, since competitive pressures apply

to each. Customer needs are a moving target. Competitive costs are also a moving target. However,

improvement for these two kinds of quality has in the past progressed at very different rates. The

chief reason is that many upper managers, perhaps most, give higher priority to increasing sales than

to reducing costs. 

Unstructured Reduction of Chronic Waste. In most companies, the urge to reduce chronic waste has been much lower than the urge to increase sales.

As a result:

The business plan has not included goals for reduction of chronic waste.

Responsibility for such quality improvement has been vague. It has been left to volunteers to initiate action.

The needed resources have not been provided, since such improvement has not been a part of the

business plan.

The quality managers have contributed to this unawareness by presenting their reports in the language of quality specialists rather than in the language of management—the language of money.

5.5

The most decisive factor in the competition for quality leadership is the rate of quality improvement.

Quality improvement should be directed at all areas that influence company performance—

business processes as well as factory processes.

5.11

Higher quality in the sense of improved product features (through product development) usually

requires capital investment. In this sense, it does cost more. However, higher quality in the sense of

lower chronic waste usually costs less—a lot less. Those who are responsible for preparing proposals for management approval should be careful to define the key words—Which kind of quality are

they talking about?

Companies that have become the quality leaders—the role models—all adopted the practice of

enlarging their business plan to include quality-oriented goals.

5.20

Deployment of Goals. Goals are merely a wish list until they are deployed—until they are

broken down into specific projects to be carried out and assigned to specific individuals or teams

who are then provided with the resources needed to take action.

5.39

The Two Journeys. The universal sequence includes a series of steps that are grouped into two journeys:

1. The diagnostic journey from symptom to cause. It includes analyzing the symptoms, theorizing

as to the causes, testing the theories, and establishing the causes.

2. The remedial journey from cause to remedy. It includes developing the remedies, testing and

proving the remedies under operating conditions, dealing with resistance to change, and establishing controls to hold the gains.

Diagnosis is based on the factual approach and requires a firm grasp of the meanings of key

words. 

5.41

FORMULATION OF THEORIES

All progress in diagnosis is made theory by theory— about causes. The theory development and testing  process consists of three steps: generating theories, arranging theories in some order, choosing theories to be tested and testing theories.

Generating Theories. Securing theories should be done systematically. Theories should be

sought from all potential contributors—line managers and supervisors, technologists, the work force,

customers, suppliers, and so on )based on the data recorded. If it based on knowledge, the extensive knowledge is to be gathered first by many participants.) Normally, the list of theories has to be  extensive, 20 or more. If only 3 or 4 theories have emerged, it usually means that the theorizing has been inadequate.

One systematic way of generating theories is called “brainstorming.” 

Another systematic approach—“nominal group technique”—is similar to brainstorming.

Participants generate their theories silently, in writing. Each then offers one theory at a time, in rotation. After all ideas have been recorded, they are discussed and then prioritized by vote.

5.49

Design of Experiments. Test of theories through experiment usually involves producing trial

samples of product under specially selected conditions. The experiment may be conducted either in

a laboratory or in the real world of offices, factories, warehouses, users’ premises, and so on.

5.55

 Choice of remedy then depends on the extent to which the proposals meet certain essential criteria. The proposed remedies should

Remove or neutralize the cause(s)

Optimize the costs

Special remedies.

Increase the factor of safety through additional structural material, use of exotic materials, design

for misuse as well as intended use, fail-safe design, and so on. Virtually all of these involve an

increase in costs.

Increase the amount and severity of test. Correlation of data on severe tests versus normal tests

then provides a prediction of failure rates.

Reduce the process variability. This applies when the defects have their origin in manufacture.

Use automated 100 percent test. This concept has been supported recently by a remarkable

growth in the technology: nondestructive test methods, automated testing devices, and computerized controls.

SECTION 6 PROCESS MANAGEMENT

James F. Riley, Jr.

Why Process Quality Management? The dynamic environment in which business is conducted today is characterized by what has been referred to as “the six c’s:” change, complexity, customer demands, competitive pressure, cost impacts, and constraints.

A business process is the logical organization of people, materials, energy, equipment, and information into work activities designed to produce a required end result (product or service).

There are three principal dimensions for measuring process quality: effectiveness, efficiency, and

adaptability. The process is effective if the output meets customer needs. It is efficient when it is

effective at the least cost. The process is adaptable when it remains effective and efficient in the face

of the many changes that occur over time. A process orientation is vital if management is to meet

customer needs and ensure organizational health.

By mid-1985, many organizations and industries were managing selected major business

processes with the same attention commonly devoted to functions, departments, and other organizational entities. Early efforts bore such names as Business Process Management, Continuous Process

Improvement, and Business Process Quality Improvement.

Much has been published on process management. AT&T (1988), Black (1985), Gibson

(1991–92), Hammer and Champy (1993), Kane (1986 and 1992), Pall (1987), Riley (1989),

Rummler (1992), Schlesiona (1988), and Zachman (1990) have all proposed similar methodological

approaches that differ from one another in minor details. The specific details of the methodology presented in this section were developed by consultants at the Juran Institute, Inc. [Gibson et al. (1990);

Riley et al. (1994)], based on years of collective experience in a variety of industries.

6.11

Process measures based on cost, cycle time, labor productivity, process yield, and the like are

measures of process efficiency.

6.13

Analyzing the Process. Process Analysis is performed for the following purposes:

● Assess the current process for its effectiveness and efficiency.

● Identify the underlying causes of any performance inadequacy.

● Identify opportunities for improvement.

● Make the improvements.

The goal for process efficiency is that all key business processes operate at minimum total

process cost and cycle time, while still meeting customer requirements.

(Productivity or Process Efficiency Engineering for Engineering Processes)

Process effectiveness and efficiency are analyzed concurrently. Maximizing effectiveness and efficiency together means that the process produces high quality at low cost; in other words, it can provide the most value to the customer.

Process decomposition—Identification of of process elements disclosed within  business process.

6.14

The “Process Analysis Summary Report” is the culmination and key output of this process analysis

step. It includes the findings from the analysis, that is, the reasons for inadequate process performance

and potential solutions that have been proposed and recorded by owner and team as analysis progressed.

SECTION 7  QUALITY AND INCOME

J. M. Juran

Consumer Products. Numerous researchers have tried to quantify the correlation between

product quality and product price. (See, for example, Riesz 1979; also Morris and Bronson 1969.)

SECTION 8. QUALITY AND COSTS

Frank M. Gryna

The underlying theme in the section is the use of quality-related costs to support a quality improvement effort rather than as a system of reporting quality costs.

The bulk of the costs were the result of poor quality. Such costs had been buried in the standards,

but they were in fact avoidable.

While these quality costs were avoidable, there was no clear responsibility for action to reduce

them, neither was there any structured approach for doing so.

 In this handbook, the term “quality costs” means the cost of poor quality

Identify major opportunities for reduction in cost of poor quality throughout all activities in an organization. Costs of poor quality do not exist as a homogeneous mass. Instead, they occur in specific segments, each traceable to some specific cause.

Cost of poor quality = Cost of nonconformities + Cost of inefficient processes+ Cost of lost opportunities for sales revenue

Note that this framework extends the traditional concept of quality costs to reflect not only the costs of nonconformities but also process inefficiencies and the impact of quality on sales revenue. Sometimes, the term “economics of quality” is employed to describe the broader concept and differentiate it from

the traditional concept of “quality cost.”

We must emphasize the main objective in collecting this data, i.e., to energize and support quality improvement activities.

Cost of Inefficient Processes. Some of the subcategories are

Variability of product characteristics: Losses that occur even with conforming product (e.g.,

overfill of packages due to variability of filling and measuring equipment).

Unplanned downtime of equipment: 

Inventory shrinkage: Loss due to the difference between actual and recorded inventory amounts.

Variation of process characteristics from “best practice”: Losses due to cycle time and costs

of processes as compared to best practices in providing the same output. 

Best practice or method doing a task is developed by industrial engineering department or process planning department. They may use benchmarking to identify best practice internally or in external organization. See:  Process Industrial Engineering - Methods and Techniques 

Non-value-added activities: Redundant operations, sorting inspections, and other non-value-added activities. 

International Standards and Quality Costs. The issue of quality costs is addressed in

ISO 9004-1 (1994), Quality Management and Quality System Elements—Guidelines, Section 6,

“Financial Considerations of Quality Systems.”

Three approaches to data collection and reporting are identified (but others are not excluded):

1. Quality costing approach: This is the failure, appraisal, and prevention approach described above.

2. Process cost approach. This approach collects data for a process rather than a product. All process costs are divided into cost of conformity and cost of nonconformity.

3. Quality loss approach: Under this approach the costs can be estimated by using the Taguchi quality loss function.

SECTION 9

MEASUREMENT, INFORMATION,

AND DECISION MAKING

Thomas C. Redman

A critical step in obtaining needed information is measurement. To measure is “to compute, estimate, or ascertain the extent, dimensions, or capacity of, especially by a certain rule or standard”

(Webster 1979). Measurement, then, involves the collection of raw data. For many types of measurements, specialized fields have grown up and there is a considerable body of expertise in making

measurements. Chemical assays and consumer preference testing are two such areas. Data collection

may involve less formal means—searching a library, obtaining data originally gathered for other

purposes, talking to customers, and the like. For our purposes, all such data collection shall be considered measurement.

Top 10 Measurement System Principles:

1. Manage measurement as an overall system, including its relationships with other systems of the

organization.

2. Understand who makes decisions and how they make them.

3. Make decisions and measurements as close to the activities they impact as possible.

4. Select a parsimonious set of measurements and ensure it covers what goes on “between functions.”

5. Define plans for data storage and analyses/syntheses/recommendations/presentations in

advance.

6. Seek simplicity in measurement, recommendation, and presentation.

7. Define and document the measurement protocol and the data quality program.

8. Continually evolve and improve the measurement system.

9. Help decision makers learn to manage their processes and areas of responsibility instead of the

measurement system.

10. Recognize that all measurement systems have limitations.

10. COMPUTER APPLICATIONS TO QUALITY SYSTEMS

Fredric I. Orkin, Daniel Olivier

TESTING AND VALIDATION

Testing Environment. Testing must ensure that the system operates correctly in the actual environment or, where such testing is not possible, in an environment that simulates the conditions of actual use. Stress testing in the actual-use environment is very effective in identifying errors that may otherwise remain undetected until after product release. Effective techniques to assure correct operation in the user environment must include “beta”-type testing, where early product versions are provided for customer-use testing to assure that the system functionality is consistent with the actual use environment.

Quality software programs exhibit certain attributes across programming languages and applications.

Correctness: Extent to which a program satisfies its specifications and fulfills the user’s mission 

objectives

Reliability: Extent to which a program can be expected to perform its intended function with required

precision

Efficiency: Amount of computing resources and code required by a program to perform a function

Integrity: Extent to which access to software or data by unauthorized persons can be controlled

Usability: Effort required to learn how to operate, prepare input, and interpret output of a program

Maintainability: Effort required to locate and fix an error in an operational program

Testability: Effort required to test a program to ensure that it performs its intended function

Flexibility: Effort required to modify an operational program 

Portability: Effort required to transfer a program from one hardware configuration and/or software 

system environment to another

Reusability: Extent to which a program can be used in other application—related to the packaging and

scope of the functions that programs perform

Interoperability: Effort required to couple one system with another

Sources of Statistical Software. Quality Progress annually publishes commercial sources

for software. The 1996 issue lists 183 companies that supply statistical software products covering

(Struebing 1996):

● Capability studies

● Design of experiments

● Sampling

● Simulation

● Statistical methods

● Statistical process control

Many industries are increasingly accepting inspection systems that are integrated with automated manufacturing systems. “This step completes the computer-integrated manufacturing (CIM)

loop” (Reimann and Sarkis 1993).

Generally, automatic inspection will couple a transducer to a computer. Transducers can take the

form of dimensional position indicators or indicators of physical effects such as force, flow, vibration,

electrical properties, and magnetic properties. An American National Standards Institute (ANSI) 

standard for integrating the CAD and dimensional measuring instruments was published in 1990

(ANSI/CAM-I 1990).

Page 10-11

Potential Applications for Automated Inspection

Industry applications 

Equipment type  - Transducer type - Computer function

Dimensional gauging    

Automatic high-speed, noncontact video inspection, and optical comparators -    Optical, laser, video, solid-state camera -   inspection of  unaligned parts

Coordinate measurement machine - Touch probe - Geometrical tolerance programming, tolerance 

analysis, multiple probe calibration, laser calibration, contouring, operator prompting,  accept/reject decision

Computer-assisted gauging (lab) -  Touch probe, electronic, air - Supervised prompting, automatic mastering,  counting, spec comparison, diagnostic testing 

Electronic gauges and measuring systems with computer interface - Calipers, micrometers, snap gauges, bore gauges, indicator probes, height gauges, air gauges, ultrasonic gauges, magnetic gauges, etc. -   Direct digital output

In-cycle gauging on numerical  control (NC) machines -      Touch probe - On machine measurements, tool wear  compensation, temperature compensation automatic check of tool offset, work location, table and spindle relationship

Bench laser micrometer - Laser - Automatic laser scan, data handling, statistical dimension calculations, part sorting, accept/reject decision

Holography - Laser - Automatic stress, strain, displacement, image processing

Laser interferometer - Laser - Automatic temperature and humidity compensation data handling and storage, math processing

3-D theodolite, coordinate, measurement -  Optical - Interactive operator prompting, automatic angular 

 measurement, data handling

Scanning laser acoustic microscope (SLAM) -  Laser, acoustic - Beam scanning, data processing

To be edited

Electrical and electronic Temperature measurement Thermocouple, thermistor, resistance Calibration; data acquisition, analysis, and processing

instrumentation temperature detector (RTD)

Robotic-printed circuit board test Electronic Robot control, fully automatic board test

Weight and balance, filling Electronic Automatic tare, statistical processing, data recording

and packaging, inspection

Circuit analyzers Electronic Special-purpose test systems

Automatic test equipment All Special-purpose test systems with complete

functional testers real-time input, processing and output data

Cable testers Electrical Automated harness continuity and high-potential

testing

Semiconductor testers Automated test of standard and special-purpose

chips

Lab devices and equipment Chromatographs Optical Fully automatic preprogrammed sampling and data

recording

Strength of materials Probe, force, displacement, Preprogrammed cycle operation; data, chart, and

strain gauge graphic output records; multichannel recording;

on-line data processing

Hardness testing Probe Robotic, fully automatic testing and recording,

results analysis, and prediction

Analyzers All Automatic calibration, testing, and recording

Electron microscopes Electromagnetic Processing and materials analysis, preprogrammed

for failure analysis

Optical imaging Video borescope, fiber-optic inspection Optical Digital data image processing documentation

Photographic Optical Fully automatic strobe, photographic sequencing

and processing

Video microscopes Optical Video image processing data documentation

High-speed video recording Optical Automatic 200–12,000 frames per second 

stop-motion recording of machine and manual

processes; motion analysis; data processing

Environmental and Test chamber controls Temperature, humidity, altitude Preprogrammed cycle controls, time and 

functional test equipment data records

Leak detection Vacuum, gas, acoustic Automatic zeroing, built-in calibration, automatic

sequencing, tolerance checking, data processing

and display

Shock and vibration testing Accelerometer Automatic cycle control, built-in calibration, data

logging and display

Built-in equipment Electrical, electronic Preprogrammed part and system functional and

environmental cycling, recording

EMI measurement Electronic, magnetic Data processing, math analysis, recording

Materials testing equipment Surface and roughness measurement Stylus follower, air flow Operator prompting, data analysis

Coating thickness, sheeting thickness Electronic, video, ultrasonic, Calculation and math processing; display; self-beta backscatter calibration; automatic filter changing and positioning; prompting self-diagnostics; feedback;

accept/reject decision

Industry applications Equipment type Transducer type Computer function

Paper, plastic, and coated product process Laser Automatic high-speed processing, feedback 

inspection for holes, particulates, controls, data analysis, and alarms

streaks, thickness

Nondestructive test equipment Magnetic particle, eddy current Probe Self-regulation, calibration, data handling,

defect recognition

Ultrasonic flaw detection Sonic, vibration Automated quantitative analysis, curve 

matching, automated procedures, graphics data 

acquisition and storage

Scanning laser acoustic microscope Laser, acoustic Beam scanning, data processing, flow detection

(SLAM) flaw detection

X-ray, fluoroscopic Optical, electronic Automatic calibration, operator prompting, data handling, statistics, stored programming, defect 

recognition

Acoustic emission Acoustic Independent channel monitoring and display, linear,

zone location, tolerance comparison, preprogrammed

tests, graphics output, triangulation, source location

Infrared test systems Optical, video Calibration, system control

Radiographic, gamma Optical, gamma Programmable, automatic, self-diagnostic, safety 

malfunction interrupts, automatic defect recognition,

robotic part handling, automatic detection of 

missing parts

Computer-aided tomography (CAT) X-ray Data acquisition, processing, interpretation and 

imaging

Nuclear magnetic resonance Magnetic Data acquisition, processing, interpretation and 

(NMR) scanner imaging

FUTURE TRENDS

Although the future is impossible to predict precisely, one thing is certain: Computer systems will

continue to revolutionize the definition of quality practices. Some current trends include:

● Data from disparate quality tracking systems will be increasingly integrated to provide system-wide

measures.

● The cost of scrap, rework, warranties, and product liability will impart continuing importance to

monitoring of the system, the process, and the machines that assure quality of output (McKee 1983).

● Evaluation of the effectiveness of software quality systems will become an increasing responsibility of the quality professional.

SECTION 13 STRATEGIC DEPLOYMENT

Joseph A. DeFeo

In recent years, total quality management (TQM) has become a pervasive change process and a

natural candidate for inclusion in the strategic plan of many organizations.

What Is Strategic Deployment? Strategic deployment is a systematic approach to integrating customer-focused organization-wide improvement efforts with the strategic plan of an organization. More specifically, strategic deployment is a systematic process by which an organization

defines its long-term goals with respect to quality, and integrates them—on an equal basis—with

financial, human resources, marketing, and research and development goals into one cohesive business plan. The plan is then deployed throughout the entire organization. (The quality emphasis can be given the term strategic quality policy deployment).

Strategic deployment has evolved during the 1990s as an integral part of many organizational

change processes, especially total quality management. Strategic deployment is part of the foundation

that supports the broader system of managing total quality throughout an organization.

The criteria for these awards stress that customer-driven quality and operational performance excellence are key strategic business issues which need to be an

integral part of overall business planning.

 In earlier versions of the Malcolm Baldrige National Quality Award this was referred to as the strategic quality

plan (SQP). 

Projects are the day-to-day, month-to-month activities that link quality improvement activities, re-engineering efforts, and quality planning teams to the organization’s business objectives.

Project: An activity of duration as long as 3 to 9 months that addresses a deployed goal, and

whose successful completion contributes to assurance that the strategic goals are achieved. A project most usually implies assignment of selected individuals to a team which is given the responsibility and authority to achieve the specific goal.

Deployment plan: To turn a vision into action, the vision must be broken apart and translated

into successively smaller and more specific parts—key strategies, strategic goals, etc.—to the

level of projects and even departmental actions. The detailed plan for decomposition and distribution throughout the organization is called the “deployment plan.” It includes the assignment of

roles and responsibilities and identification of resources needed to implement and achieve the

project goals.

SECTION 14 TOTAL QUALITY MANAGEMENT

A. Blanton Godfrey

Juran stated that, “Just as the twentieth century was the century of productivity, the twenty-first century will be the quality century.”

 Total quality management (TQM) is probably the most frequently used term in the United States, while total quality control (TQC) was until recently most often used in Japan, although this may be changing. “The term TQC (total quality control) has begun to be replaced in Japan by the term TQM (total quality management)” (Kondo 1995, p. vi). Kondo himself uses the equivalent term “Companywide Quality Management” in his recent book (Kondo 1995). Another term sometimes encountered is “continuous quality improvement” (CQI). In 1997, JUSE announced a formal change from the term TQC (total quality control) to TQM (total quality management) (The TQM Committee 1997a, p. 1). 

In JUSE’s view, TQM is a management approach that strives for the following in any business

environment:

● Under strong top-management leadership, establish clear mid- and long-term vision and strategies.

● Properly utilize the concepts, values, and scientific methods of TQM.

● Regard human resources and information as vital organizational infrastructures.

● Under an appropriate management system, effectively operate a quality assurance system and

other cross-functional management systems such as cost, delivery, environment, and safety.

● Supported by fundamental organizational powers, such as core technology, speed, and vitality,

ensure sound relationships with customers, employees, society, suppliers, and stockholders.

● Continuously realize corporate objectives in the form of achieving an organization’s mission,

building an organization with a respectable presence, and continuously securing profits.

In any discussion of total quality it is useful to start with the basics: the results we expect, the

three fundamental concepts, the three strong forces, the three critical processes, and the key elements

of the total quality infrastructure.

The Results of Total Quality. The almost universally accepted goals of total quality are lower costs, higher revenues, delighted customers, and empowered employees. These goals need little explanation.

The Three Fundamental Concepts. In the past few years many leading companies throughout the world have begun to revisit the fundamental concepts of quality management: customer focus, continuous improvement, and the value of every individual.

The Three Strong Forces. There are three primary drivers of performance excellence: alignment, linkage, and replication. 

The Three Critical Processes for Quality Management.

Quality Planning. Quality Control. Quality Improvement.

The Total Quality Management Infrastructure. The elements include the quality system, customer-supplier partnerships, total organization involvement, measurement and information, and education and

training.

The Malcolm Baldrige National Quality Award Criteria. The core values and concepts described previously are embodied in seven categories:

1.0 Leadership

2.0 Strategic Planning

3.0 Customer and Market Focus

4.0 Information and Analysis

5.0 Human Resource Focus

6.0 Process Management

7.0 Business Results

SECTION 15 HUMAN RESOURCES AND QUALITY

W. R. Garwood 

Gary L. Hallen

The purpose of this section is to present concepts, structures, methods, and tools which have helped successful organizations manage human resources effectively in directing their efforts toward the pursuit of high-quality

products (including services).

Major TQM elements (as embodied in the criteria of the Malcolm Baldrige National Quality

Award and other major state, national, and regional quality awards around the world) which relate

directly to human resources, and the Baldrige points associated with them are

4.1 Human resource planning and evaluation 20 of 1000

4.2 High-performance work systems 45 of 1000

4.3 Employee education, training, and 50 of 1000

development

4.4 Employee well-being and satisfaction 25 of 1000

6.3 Human resource results 35 of 1000

Employee empowerment is an advanced form of employee involvement. Empowerment is a condition in which the employee has the knowledge, skills, authority, and desire to decide and act within prescribed limits.

Empowerment = alignment x authority x capability x commitment

DESIGN PRINCIPLES OF WORK AND ORGANIZATION

Design Work for Optimum Satisfaction of Employee, Organization, and Customer. 

Successful organizations are designed to achieve high employee commitment and

organizational performance focused on satisfying, and even delighting, the customers. A proper work

design allows people to take action regarding their day-to-day responsibilities for customer satisfaction and employee satisfaction.

Design a System that Promotes High Levels of Employee Involvement at All Levels in Continuous Improvement.

TRAINING IN A TOTAL QUALITY ORGANIZATION

An attribute that successful organizations have in common is commitment to extensive training of employees.

Multiskilled workers increase the organization’s flexibility and facilitate teamwork. A multiskilled work force is a key feature of the desired organization and a key objective of the training

activity.

Training should focus on developing technical skills and social skills. Technical skills are the job-related skills to do the technical tasks of the job. Social skills are the skills of personal interaction and

administration which, together, enable team members to work collaboratively to manage their business.

Examples of Positive Reinforcement. Successful teams celebrate their success. The

sports world is filled with examples of how positive reinforcement drives continuous improvement:

A football player who scores is immediately congratulated by fellow players; a baseball player who

hits a home run is congratulated by fellow base runners who await him at home plate;

Lester Thurow (1992) states in his book Head to Head: “The skills of the workforce are going to be

the key competitive weapon in the twenty-first century. Brainpower will create new technologies, but

skilled labor will be the arms and legs that allow one to employ—to be the low-cost masters of—the

new product and process technologies that are being generated.”

Those organizations that get the highest performance from employees who can work together effectively with the technology of their systems are projected to be long-term maximizers.

This is not easy to implement. If it were easy, every good company would be working to make

itself a high-performing organization.

---------------------------------

Industrial Engineering, Productivity and Quality

F.W. Taylor: Industrial Engineers to Guard Against Deterioration of Quality Due to Increase in Output.

One of the dangers to be guarded against, when the pay of the man or woman is made in any way to depend on the quantity of the work done, is that in the effort to increase the quantity the quality is apt to deteriorate.

It is necessary ... to take definite steps to insure against any falling off in quality before moving in any way towards an increase in quantity.

https://nraoiekc.blogspot.com/2013/08/illustrations-of-success-of-scientific_9321.html

Evolution of The Quality Management Philosophy and Practice

https://nraomtr.blogspot.com/2017/03/evolution-of-quality-management.html

Updated frequently

Pub 2.9.2024,  23.5.2022, 6.5.2022,  20.4.2022