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33 Cards in this Set

  • Front
  • Back
Define "defect"
Any instance when a process fails to satisfy its customer
Define "prevention costs"
Costs associated with preventing defects before they happen.
Define "appraisal costs"
Costs incurred when the firm assesses the performance level of its processes
Define "internal failure costs"
Costs resulting from defects that are discovered during the production of a service or product.
Define "external failure costs"
Costs that arise when a defect is discovered after the customer receives the service or product.
Includes warranty service and litigation costs.
Define "total quality management (TQM)"
A philosophy that stresses 3 principles for achieving high levels of process performance and quality:
1-customer satisfaction
2-employee involvement
3-continuous improvement in performance
What are the 3 approaches to teamwork?
1- problem-solving teams
2- special-purpose teams
3- self-managed teams
Define "employee empowerment"
An approach to teamwork that moves responsibility for decisions further down the organizational chart- to the level of the employee actually doing the job
Define "quality circles"
another name for problem-solving teams; small groups of supervisors and employees who meet to identify, analyze and solve process and quality problems
Define "continuous improvement"
The philosophy of continually seeking ways to improve processes based on a Japanese concept called kaizen
Define "statistical process control (SPC)"
The application of statistical techniques to determine whether a process is delivering what the customer wants.
What are the 2 basic categories of variation in output?
1- common causes (random, unidentifiable sources that are unavoidable w/current process)
2- assignable causes (can be ID'd and eliminated)
What is a control chart?
A time-ordered diagram that is used to determine whether observed variations are abnormal.
Define "type 1 error"
An error that occurs when the employee concludes that the process is out of control based on a sample result that falls outside the control limits, when in fact it was due to pure randomness.
(when you call a good process bad)
Define "type 2 error"
An error that occurs when the employee concludes that the process is in control and only randomness is present, when actually the process is out of statistical control.
(you think the process is doing well but it’s out of control)
What is an R-chart?
Range chart- used to monitor process variability
What is an xbar chart?
Used to see whether the process is generating output, on avg, consistent w/a target value set by mgmt for the process or whether its current performance, with respect to the avg of the performance measure, is consistent w/past performance.
what are the steps to develop and use xbar and R-charts?
1- Collect data on the variable quality measurement & organize the data by sample #.
2- Compute the range for each sample and the avg range, /R, for the set of samples
3- Use table 6.1 to determine UCL and LCL of the R-chart
4- Plot the sample ranges (if in control -> step 5, if not ->step 1)
5- Calculate /x for each sample and determine the central line of the chart, //x
6- Use table 6.1 to determine parameters for UCL/x and LCL/x, and construct /x chart
7- Plot the sample means
What is a p-chart?
used for controlling the proportion of defective services or products generated by the process
What is a c-chart?
used for controlling the number of defects when more than 1 defect can be present in a service or product
Define "process capability"
the ability of the process to meet the design specifications for a service or product.
Define "nominal value"
a target for design specifications
Define "tolerance"
an allowance above or below the nominal value
What is the process capability ratio, Cp?
Cp = (upper specification - lower specification)/6 stdev
tolerance width divided by 6 standard deviations (process variability)
Cp value of 1.0 implies that the firm is product 3-sigma quality
What is the process capability index, Cpk?
Cpk= minimum of [ (//x - lower spec.)/3sigma, (upper spec - //x)/3sigma]

an index that measures the potential for a process to generate defective outputs relative to either upper or lower specifications
Define "quality engineering"
An approach originated by Genichi Taguchi that involves combining engineering and statistical methods to reduce costs and improve quality by optimizing product design and manufacturing processes.
Define "quality loss function"
The rationale that a service or product that barely conforms to the specifications is more like a defective service/product than a perfect one.
What is Six Sigma?
A comprehensive and flexible system for achieving, sustaining, and maximizing business success by minimizing defects and variability in processes.
What are the 5 steps in the Six Sigma improvement model?
1- Define
2- Measure
3- Analyze
4- Improve
5- Control
(DMAIC)
What are the 4 steps on the Deming Wheel?
Plan
Do
Check
Act
Why Six Sigma?
1. Decisions based on facts and data rather than opinion
2. Eliminating chronic problems (assignable and common cause variation)
3. Providing a disciplined approach to problem solving (creating a questioning and reflective culture)
4. Achieving competitive advantage
5. Improving profits
What are the 2 types of quality measurement?
1. Attributes- just saying yes/no or good/bad- not measuring anything (ex: looking at an apple)
2. Variables- anytime you have to measure something (e.g. wait time, weights)
What happens to the probability of errors when you shrink the confidence interval?
As you shrink the confidence interval, # of type 1 errors go up and # of type 2 errors go down.
To reduce both, increase the sample size, which shrinks the standard deviation size