Deming cycle

Deming cycle is a tool for continuous improvement and it is a tool for an ongoing effort to improve products, services or processes. These efforts can seek “incremental” improvement over time or “breakthrough” improvement all at once. Among the most widely used tools for continuous improvement is a four-step quality model—the plan-do- check-act (PDCA) cycle, also known as Deming Cycle or Shewhart Cycle:

The four stages of PDCA/Shewhart Cycle or Deming Wheel are:

1. PLAN

· Study & Document the existing process.

· Collect data to identify problems.

· Survey data and develop a plan for improvement.

· Specify measures for evaluating the plan.

2. DO

· Implement the plan on a small scale.

· Document any changes made during this phase.

· Collect data systematically for evaluation.

3. CHECK

· Evaluate the data collection during this phase.

· Check how closely the results match the original goals of the plan phase.

4. ACT

· If the results are successful, standardize the new method and communicate the new method to all people associate with the process.

· Implement training for the new method.

· If results are unsuccessful, revise the plan and repeat the process or cease this project.

Deming cycle was developed to link the production of a product with consumer needs and focus the resources of all departments (research, design, production, and marketing) in a cooperative effort to meet those needs. The Deming Cycle proceeds as follows:

1. Conduct consumer research and use it in planning the product (PLAN).

2. Produce the product (DO).

3. Check the product to make sure it was produced in accordance with the plan (CHECK).

4. Market the product (ACT).

5. Analyze how the product is received in the marketplace in terms of quality, cost, and other criteria (ANALYZE).

Deming cycle

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Just In Time (JIT)

Just In Time (JIT) is an inventory strategy implemented to improve the return on investment of a business by reducing in process inventory and its associated carrying costs. JIT fits well under the TQM umbrella, for many of the ideas and techniques are very similar and, moreover, JIT will not work without TQM in operation. Writing down a definition of JIT for all types of organization is extremely difficult, because the range of products, services and organization structures leads to different impressions of the nature and scope of JIT. It is essentially:

· A series of operating concepts that allows systematic identification of operational problems.

· A series of technology-based tools for correcting problems following their identification.

An important outcome of JIT is a disciplined program for improving productivity and reducing waste. This program leads to cost-effective production or operation and delivery of only the required goods or services, in the correct quantity, at the right time and place.

Principle: The process is driven by a series of signals, which can be Kanban, that tell production processes when to make the next part. Kanban are usually 'tickets' but can be simple visual signals, such as the presence or absence of a part on a shelf. When implemented correctly, JIT can lead to dramatic improvements in a manufacturing organization's return on investment, quality, and efficiency.

Aims of JIT:

The fundamental aims of JIT are to produce or operate to meet the requirements of the customer exactly, without waste, immediately on demand. In some manufacturing companies JIT has been introduced as ‘continuous flow production’, which describes very well the objective of achieving conversion of purchased material or service receipt to delivery, i.e. from supplier to customer. If this extends into the supplier and customer chains, all operating with JIT a perfectly continuous flow of material, information or service will be achieved. JIT may be used in non-manufacturing, in administration areas, for example, by using external standards as reference points.

The JIT concepts identify operational problems by tracking the following:

1 Material movement – When material stops, diverts or turns backwards, these always correlate with an aberration in the ‘process’.

2 Material accumulations – These are there as a buffer for problems, excessive variability, etc.

3 Process flexibility – An absolute necessity for flexible operation and design.

4 Value-added efforts – Where much of what is done does not add value, the customer will not pay for it.

The operation of JIT:

The tools to carry out the monitoring required are familiar quality and operations management methods, such as:

· Flowcharting.

· Process study and analysis.

· Preventive maintenance.

· Plant layout methods.

· Standardized design.

· Statistical process control.

· Value analysis and value engineering.

But some techniques are more directly associated with the operation of JIT systems:

1. Batch or lot size reduction.

2. Flexible workforce.

3. Kanban or cards with material visibility.

4. Mistake-proofing.

5. Pull-scheduling.

6. Set-up time reduction.

7. Standardized containers.

In addition, joint development programs with suppliers and customers will be required to establish long-term relationships and develop single sourcing arrangements that provide frequent deliveries in small quantities. These can only be achieved through close communications and meaningful certified quality.

Advantages of JIT:

· Lower stock holding means a reduction in storage space which saves rent and insurance costs

· As stock is only obtained when it is needed, less working capital is tied up in stock

· There is less likelihood of stock perishing, becoming obsolete or out of date

· Avoids the build-up of unsold finished product that can occur with sudden changes in demand

· Less time is spent on checking and re-working the product of others as the emphasis is on getting the work right first time

Disadvantages of JIT:

· There is little room for mistakes as minimal stock is kept for re-working faulty product

· Production is very reliant on suppliers and if stock is not delivered on time, the whole production schedule can be delayed

· There is no spare finished product available to meet unexpected orders, because all product is made to meet actual orders.

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Benchmarking

Benchmarkingis an important tool for bringing about continuous improvement that is required to survive competitive world of business these days. It is a structured management tool that involves comparison of management process and learning from the others for the further organizational improvement. Not the whole process is to be change but the important and critical processes can be changed according to the need in view of improvement.

Benchmarking will be result oriented when approach to the learning is positive and mind of the learner is ready to adopt the changes.

Benchmarking is of following types

Internal Benchmarking: Internal benchmarking involves comparison of two or more departments /units or division within the organization.

Competitive Benchmarking: It is type of benchmarking in which comparison is done directly against the competitor. It is usually done through the help of third party or consultant. It is crucial to select the appropriate organization to compare with.

Functional Benchmarking: it involves improving the specific function’s quality and efficiency like advertisement process, HR policies, marketing process.

Generic Benchmarking: This type of benchmarking involves comparison of various common functions and system across the different companies or industry such as inventory system, customer interaction, and billing.

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Six-Sigma

Six-Sigma refers to a quality improvement and business strategy concept started by Motorola, USA in 1986.  In statistical terms, Six-Sigma is the abbreviated form of 6 standard deviations from the mean. Six-Sigma is a set of methodologies used by businesses to achieve extremely low failure rates in any process. It provides the techniques and tools to improve the capability and reduce the defects in any process.

Each Six Sigma project carried out within an organization follows a defined sequence of steps and has quantified financial targets (cost reduction or profit increase). A six sigma process is one in which 99.99966% of the products manufactured are statistically expected to be free of defects (3.4 defects per million opportunities or 3.4 DPMO).

Six Sigma projects follow two methods inspired by Deming's Plan-Do-Check-Act Cycle.

DMAIC:

Define the problem.

Measure key aspects of the current process.

Analyze the data to investigate and verify cause-and-effect relationships.

Improve the current process based upon data analysis using techniques.

Control the future state process to ensure that there is no deviations from target.

DMADV or DFSS:

Define design goals that are consistent with customer demands.

Measure and identify CTQs (characteristics that are Critical To Quality).

Analyze to develop and design alternatives.

Design details, optimize the design, and plan for design verification.

Verify the design, set up pilot runs, implement the production process and hand it over to the process owner(s).

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Cost of Quality

It’s a term that’s widely used – and widely misunderstood. The “cost of quality” isn’t the price of creating a quality product or service. It’s the cost of NOT creating a quality product or service. Every time work is redone, the cost of quality increases. Obvious examples include:

• The reworking of a manufactured item.

• The retesting of an assembly.

• The rebuilding of a tool.

• The correction of a bank statement.

• The reworking of a service, such as the reprocessing of a loan operation or the replacement of a food order in a restaurant.

In short, any cost that would not have been expended if quality were perfect contributes to the cost of quality.

 

Total Quality Costs:

As the table below shows, quality costs are the total of the cost incurred by:

• Investing in the prevention of nonconformance to requirements.

• Appraising a product or service for conformance to requirements.

• Failing to meet requirements.

Quality Costs—general description:

Prevention Costs:

The costs of all activities specifically designed to prevent poor quality in products or services.

Examples are the costs of:

• New product review

• Quality planning

• Supplier capability surveys

• Process capability evaluations

• Quality improvement team meetings

• Quality improvement projects

• Quality education and training

Appraisal Costs:

The costs associated with measuring, evaluating or auditing products or services to assure conformance to quality standards and performance requirements.

These include the costs of:

• Incoming and source inspection/test of purchased material

• In-process and final inspection/test

• Product, process or service audits

• Calibration of measuring and test equipment

• Associated supplies and materials

Failure Costs:

The costs resulting from products or services not conforming to requirements or customer/user needs. Failure costs are divided into internal and external failure categories.

Internal Failure Costs: Failure costs occurring prior to delivery or shipment of the product, or the furnishing of a service, to the customer.

Examples are the costs of:

• Scrap

• Rework

• Re-inspection

• Re-testing

• Material review

• Downgrading

External Failure Costs: Failure costs occurring after delivery or shipment of the product and during or after furnishing of a service to the customer.

Examples are the costs of:

• Processing customer complaints

• Customer returns

• Warranty claims

• Product recalls

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