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Lecture 8

GMS 401 Lecture Notes - Lecture 8: Six Sigma, Sample Size Determination, Standard Deviation

Global Management Studies
Course Code
GMS 401
Wally Whistance- Smith

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Lecture 8: Quality Control
Qualit: The ailit of produts to eet ad eeed ustoers’ epetatios
Is quality the most important factor or does it fall behind price?
Quality is directly related to productivity
As we have better methods, that level of otrol ad orgaizatio ehid orker’s
production leads to better product
Statistical Process Control to determine whether a particular is under control. Because if
worker is working our method, paying attention to detail, the output generated is within
the matrix company set out
If worker produces using correct method, will not make methods
Rejection is an important part of the lecture
We try to see if the product falls under the limits the company set out for it
Interested in the idea whether or not product falls in the scope laid out by the company
Two ways of falling outside the scope
o We can put too much (outside upper limit)
o We put too less (outside lower limit)
A. Introduction
B. Inspection
C. Statistical Process Control (signal or indicator whether or not product falls outside
D. Process Capability
What does the term quality control mean?
o Quality Control is an activity that evaluates quality characteristics relative to a
standard, and takes corrective action when they do not meet standards
o If e a fid he a produt falls outside of those liits, does’t eet the
limits, we would hope to be able to source out where the problem lies
o Because 80% of the problem falls in 20% of the processes
o We want to isolate the problem is because we want to take corrective action
o Remove the worker, train them and etc. to be able to take various corrective
actions to follow acceptable standards
How is quality control accomplished?
o by monitoring and inspecting the product during process
o We can look at quality after the product has been finished, we will find defects
after ut o’t ko he ad here the ere reated
o Ca’t take orretie atios so that the et ath is’t affeted
A. Phases of Quality Assurance
In a perfect world, with absolute certainty, you would inspect all the product
throughout the process
Not possible
Imagine producing wine, if checking every bottle, you will have nothing to sell
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We test a small batch, or sample of a production, and compare results to the entire
series of products being produced
Sample produces overall characteristics of the whole batch
If bad, we may reject entire batch and go back to the batch and correct
Corrective actions during production we can pull product off the line and fix it
Or on a continuous manner building quality through every step
Inspection is costly, costly to inspect (takes workers time, inspectors time, salaries are
still set out) ut ore sigifiat if e do’t ispet
Inspection is a financial teeter-totter
How Much/How Often
o How much should we inspect and how often should we inspect
o If producing something for long time we believe that production is table and
inspection is not needed, not inspecting can be catastrophic
o Minimum is required
o More you inspect the higher degree of confidence assessing overall
characteristics of whole batch
o When to inspect and where to inspect
o Inspect at every junction point in the production process (high cost)
o Inspect every other production point (cut cost by 50%)
o Inspect at various key stages (key sub-assemblies)
o Cost associated with it is very significant. Depending on the industry and we can
determine how much we need to spend on inspection
Centralized vs. On-site
o Do we have centralized inspection process or an on-site one?
o In other words: do we do our own, or do we send things out to be inspected
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Where to Inspect in the Process
Raw materials when they are received or implemented into the production system
Before the irreversible process
Or the finished product
Not definite but reflective of the type of product we are producing
Inspection Costs
Financial teeter-totter spoke of earlier
Look at the total cost at first cost goes down over a period of time and then goes up.
One unit has a lot of overhead associated with it, and marginal cost of inspection
So long as cost of defective items is decreasing and cost of inspection is increasing,
where they meet represents the lowest point in the total cost curve
You do’t at to sped ore o ispetio tha hat ou’re goig to e gettig out of
it  ispetig. You o’t at to ispet aore here. Ispetig too uh ost ad
not inspecting may cause defective which can also raise cost
Examples of Inspection Points
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