Quality level Chapter 8 Process Improvement Check Do Act Plan McGraw-Hill/Irwin Service Management: Operations, Strategy, and Information Technology, 6e Time Copyright 2008 by The McGraw-Hill Companies, Inc. All Rights Reserved.
Learning Objectives Use quality tools for process analysis and problem solving. Describe and contrast corporate quality improvement programs. Lead a team in a process improvement initiative. Conduct a data envelopment analysis (DEA). 7-2
Quality and Productivity Improvement Process Foundations of Continuous Improvement - Customer Satisfaction - Management by Facts - Respect for People Plan-Do-Check-Act (PDCA) Cycle 7-3
Quality Tools for Analysis and Check Sheet Run Chart Histogram Pareto Chart Flowchart Problem Solving Cause-and-Effect Diagram Scatter Diagram Control Chart Benchmarking 7-4
Check Sheet of Problems Month Lost Departure Mechanical Overbooked Other Luggage Delay January 1 2 3 3 1 February 3 3 0 1 0 March 2 5 3 2 3 April 5 4 4 0 2 May 4 7 2 3 0 June 3 8 1 1 1 July 6 6 3 0 2 August 7 9 0 3 0 September 4 7 3 0 2 October 3 11 2 3 0 November 2 10 1 0 0 December 4 12 2 0 1 Total 44 84 24 16 12 7-5
Run Chart of Departure Delays 14 12 10 Departure Delays 8 6 4 2 0 1 2 3 4 5 6 7 8 9 10 11 12 Months 7-6
Histogram of Lost Luggage 3.5 3 2.5 Frequency 2 1.5 1 0.5 0 1 2 3 4 5 6 7 Occurrences per Month 7-7
Pareto Chart of Problems Number of Problems 90 80 70 60 50 40 30 20 10 0 Departure Delay Lost Luggage Mech. Overbooked Other 7-8
Cause-and-Effect Chart for Flight Departure Delay (Fishbone Chart) Equipment Personnel Other Weather Air traffic Aircraft late to gate Late arrival Gate occupied Mechanical failures Late pushback tug Gate agents cannot process passengers quickly enough Too few agents Agents undertrained Agents undermotivated Agents arrive at gate late Late cabin cleaners Late or unavailable cabin crews Late or unavailable cockpit crews Poor announcement of departures Weight and balance sheet late Delayed Flight Departure Late baggage to aircraft Late fuel Late food service Delayed checkin procedure Confused seat selection Passengers bypass checkin counter Checking oversize baggage Issuance of boarding pass Material Acceptance of late passengers Cutoff too close to departure time Desire to protect late passengers Desire to help company s income Poor gate locations Procedure 7-9
Pareto Analysis of Flight Departure Delay Causes Cause Percentage of Incidents Cumulative Percentage Late passengers 53.3 53.3 Waiting for pushback 15.0 68.3 Waiting for fuel 11.3 79.6 Late weight and balance sheet 8.7 88.3 7-10
Flowchart at Departure Gate Passenger Arrives Ticket No Wait for For Flight Appropriate Flight Yes Check Yes Excess Luggage Carry-on No Issue Boarding Pass Passenger Boards Airplane 7-11
Scatter Diagram of Departure Delay vs Late Passengers 12 10 Departure Delays 8 6 4 2 0 0 1 2 3 4 5 6 7 Late Passengers 7-12
Control Chart of Departure Delays Percentage of ontime flights 100 90 80 70 60 Lower Control Limit 1998 1999 expected UCL p 3 p(1 n p LCL p 3 p(1 n p 7-13
Quality Improvement Programs Personnel Programs for Quality Assurance Deming s 14 Point Program Baldrige National Quality Award ISO 9000 Six-Sigma 7-14
Six Sigma DMAIC Process Steps Step Define Measure Analyze Improve Control Definition Define project objectives, internal and external customers Measure current level of performance Determine causes of current problems Identify how the process can be improved to eliminate the problems Develop mechanisms for controlling the improved process 7-15
Topics for Discussion Discuss why Deming s 14-point program was rejected by U.S. firms but embraced by the Japanese following World War II. Explain how the application of the DPCA cycle can support a competitive strategy of low cost leadership. What are the limitations of benchmarking? Articulate a process in which DEA can be used to improve the performance of an elementary school district. 7-16
Interactive Exercise Perform a walk-through audit of the class experience by recording responses on a five point Likert scale using a show of hands without the professor present. Average the student responses for each statement and use a graph to compare the results with the professor s own assessment. 7-17
Mega Bytes Restaurant 1. How is the Seven-Step Method (SSM) different from Deming s PDCA cycle? 2. Prepare a cause-and-effect or fishbone diagram for a problem such as Why customers have long waits for coffee. Use Figure 7.7 as a guide. 3. How would you resolve the difficulties that study teams have experienced when applying the SSM? 7-18
The Seven-Step Method (SSM) Step 1: Define the project Step 2: Study the current situation Step 3: Analyze the potential causes Step 4: Implement a solution Step 5: Check the results Step 6: Standardize the improvement Step 7: Establish future plans 7-19