March 2010

Improving Quality and Eliminating Waste Using Simple Statistical Methods

by Davis M. Woodruff, PE, CMC Management Methods Inc.

1. Quality: Understanding the Definition

"How do you define Quality?"

Everyone has an opinion. Some would refer to quality as goodness or customer satisfaction. Since quality can mean different things to different people, the definition of quality could be confusing. So let’s go to an internationally accepted definition. The ISO 9000 standard defines quality as: “The degree to which a set of inherent characteristics fulfils requirements.” This definition of quality is very specific, and can be applied to any job, product or process, since all must have requirements.

"So where do simple statistical methods fit?"

Statistical Process Control (SPC) is a tool kit of simple statistical methods which can be a basis for developing product specifications or performance requirements. Both of which are prerequisites to understanding product and process performance. SPC helps establish "requirements" by providing a way to measure the capability of a process. With a measure of a process capability we can decide whether a process can feasibly conform to a proposed requirement and/or specification.

Knowing the capability of the process will enable you to negotiate a reasonable level of performance with a customer, or in other words develop mutually agreed upon requirements for a given parameter.

2. Establishing the System
The question of what system is needed to achieve quality improvement and reduce waste usually brings to mind inspections, tests, overhead and “after the fact” measurement or appraisal in our industry as in many other industries. All these systems have a common fault--they find non-conformances after the fact (after the product is completed). Such systems require rework, reprocessing, and fixing to turn the product into conforming condition. This philosophy of appraisal is very expensive. It costs a lot of money to do things right the second time and leads to waste throughout our processes.

The only system that has a chance of improving quality and reducing or eliminating waste is prevention. Prevention is causing defects of nonconformance not to occur by eliminating the potential for error. Prevention is identifying opportunities for error and taking corrective action to prevent the errors from occurring. The ISO 9001 quality management system can help an organization focus on continual improvement.

All appraisal approaches to quality involve finding defects and fixing them. These activities are not necessary if a prevention system is in place.

"How will Statistical Methods or SPC Help?"

SPC techniques can be used to monitor processes to prevent non-conformances from occurring and will lead to the control of processes well within the specification limits (requirements). SPC techniques will not only permit closer monitoring and control of processes so that problems are detected and analyzed before the product goes off spec, but SPC techniques are available to help define and eliminate reoccurring problems. SPC is a vital tool in the prevention effort.

3. Establishing Performance Standards

All a performance standard is - "How often do you want something (a process) done right"? Too often in business, a performance standard of "that's close enough" gets established. Such a standard can lead employees to believe that nonconformance is acceptable.

The answer to "how often do you want a process done right?" should be "every time". SPC can help determine (quantitatively) the extent of process change which is required to attain a Zero Defects standard by comparing process capability with product specifications. This is the foundation of the six sigma approach. It will greatly enhance the ability to monitor processes closely to catch and prevent nonconformance from occurring. Also, SPC will assist in identifying the cause of problems and help in generating solutions. SPC problem solving techniques will help to drive the frequency of non-conformances to zero.

4. Process and Quality Measurement

In the past, quality was measured using indices or averages or sometimes just the number of customer complaints. Such measures can lead to confusion and fail to define the extent of the problems caused by issues in a process.

Tremendous dollars are wasted throughout our industry for failure to do things right the first time. This involves one of the seven categories of waste that we will be discussing in detail at IWF in August 2010.

Non-conformance elimination will reduce product unit cost, possibly contribute to increased market share, and could play a significant part in assuring the survival and growth of an organization.

SPC, with its improved methods of monitoring, and its ability to better control processes, will play an important role in reducing the costs of nonconformance throughout an organization. SPC will enable processes to be run more consistently thereby increasing the percentage of product that meets customer expectations (improved quality). It will reduce the output requiring reprocessing or rework (improve unit). It can increase the total yield of conforming output through the process (improving process capacity).