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©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

CHAPTER 14
CONTROLLING PRODUCTIVITY, QUALITY, AND SAFETY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Explain the concept of productivity
  • Identify and explain the ways in which management, government, unions, and employees affect productivity
  • Describe some steps supervisors can take to increase productivity
  • Differentiate between total quality and quality control
  • Describe the role of variance in controlling quality

LEARNING OBJECTIVES

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  • Identify some important tools for controlling quality
  • Describe the supervisor’s role in supporting lean organizations
  • Explain what the Occupational Safety and Health Administration (OSHA) does
  • Describe the supervisor’s role in promoting safety

LEARNING OBJECTIVES

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  • Measure of efficiency that compares outputs to inputs
  • Basic productivity ratio

Total output of goods/services

Total costs

  • Can be increased by:
  • Increasing total output without changing total costs
  • Decreasing total inputs costs without changing total output
  • Increasing output and decreasing input costs

PRODUCTIVITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.3 - EXAMPLES OF PRODUCTIVITY MEASUREMENTS

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IMPORTANCE OF PRODUCTIVITY

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GROUPS INFLUENCING PRODUCTIVITY

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HOW SUPERVISORS CAN IMPROVE EMPLOYEE PRODUCTIVITY

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HOW SUPERVISORS CAN IMPROVE EMPLOYEE PRODUCTIVITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Make use of budgets to:
  • Help control costs
  • Evaluate a department’s actual performance
  • Identify areas that need attention
  • Look to generate favorable variances to offset unfavorable variances
  • Technology provides up-to-the-minute cost data that supervisors can share with their teams
  • And challenge the team to look for ways to cut costs

SUPERVISOR’S ROLE IN COST CONTROL

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  • Robot: Machine controlled by a computer that can be programmed to perform a number of repetitive manipulations of tools or materials
  • RFID: Radio frequency identification technology uses radio waves to identify inventory
  • Computer-assisted manufacturing (CAM): Special computers assist equipment in performing processes

PRODUCTIVITY IMPROVEMENT METHODS FOR CONTROLLING QUALITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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DEMING’S FOURTEEN POINTS FOR QUALITY

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DEMING’S FOURTEEN POINTS FOR QUALITY

14–*

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  • Establish a plan to seek improvement continuously in all phases of operations
  • Put in place a system that accurately tracks and measures performance in those areas
  • Establish a long-term strategic plan based on performance targets that compare with the world’s best in that particular industry
  • Link with suppliers and customers in a way that provides feedback for continuous improvement

REQUIREMENTS TO WIN THE MALCOLM BALDRIGE NATIONAL QUALITY AWARD

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Demonstrate a deep understanding of customers to convert their wants into products
  • Establish and maintain long-lasting customer relationships
  • Focus on preventing mistakes
  • Make a commitment to quality improvement throughout all levels of the organization

REQUIREMENTS TO WIN THE MALCOLM BALDRIGE NATIONAL QUALITY AWARD

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Quality directly affects the bottom line
  • In terms of cost of scrapped materials, wasted time, costs of rework, and customers’ exercise of warranties
  • Vigorous global competition
  • Firms are required to achieve ISO 9000 certification
  • Increased information available to the public regarding product and service quality

REASONS FOR GREATER QUALITY EMPHASIS

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  • Total quality: Organization’s overall effort to achieve customer satisfaction through continuous improvement of products or services
  • Quality control: Defined measurements designed to check whether the desired quality standards are being met

TOTAL QUALITY AND QUALITY CONTROL

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EXHIBIT 14.14 - THE TOTAL QUALITY CHAIN

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  • Nature of processes is to exhibit variation
  • Measurable dimensions will vary in items produced in a manufacturing process
  • Types of variation
  • Common cause variation - General, routine variation built into the system
  • Special cause variation - Occurs intermittently and is associated with a specific event

UNDERSTANDING VARIANCE IN CONTROLLING QUALITY

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  • Reducing variation
  • Common cause variation can be corrected only through management action to improve the process
  • Special cause variation can be reduced by identifying the problem, isolating it, examining the cause, and remedying it
  • Six Sigma
  • Quality control technique
  • Helps reduce the number of defects in a company’s end-to-end process

UNDERSTANDING VARIANCE IN CONTROLLING QUALITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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TOOLS FOR CONTROLLING QUALITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.15 - TYPE OF POWER FAILURES

Source: From Martin K. Starr Production and Operations Management, 2nd ed. Copyright 2008, Atomic Dog, a part of Cengage Leaning, Inc. Reproduced by permission. www.cengage.com/permission

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.16 - FLOWCHART OF A FAST-FOOD DRIVE-THROUGH PROCESS

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.17 - HISTOGRAM SHOWING FREQUENCY AND LENGTH OF TIME TAKEN BY HOME OFFICE TO PROCESS LOAN REQUEST

Source: From James W. Dean and James R. Evans. Total Quality, Management, Organization, and Strategy, 4e.

Copyright © 2005 South-Western, a part of Cengage Learning, Inc. Reproduced by permission. www.cengage.com/permissions.

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.18 - RUN CHART OF PERCENTAGE OF RESTAURANT CUSTOMERS WAITING IN EXCESS OF 1 MINUTE TO BE SEATED

Source: From Foundations of Total Quality Management: A Readings Book, 1st ed., by Van Matre, 146.0030078660. Copyright © 1995 by Joseph Van Matre. Reprinted with permission of the author.

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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TOOLS FOR CONTROLLING QUALITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.19 - PARETO CHART OF CUSTOMERS’ COMPLAINTS ABOUT RESTAURANTS

Source: From Foundations of Total Quality Management: A Readings Book, 1st ed., by Van Matre, 146. 0030078660. Copyright © 1995 by Joseph Van Matre. Reprinted with permission of the author.

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.20 - CAUSE-AND-EFFECT DIAGRAM FOR “WHY TABLES ARE NOT CLEARED QUICKLY”

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Source: From Foundations of Total Quality Management: A Readings Book, 1st ed., by Van Matre, 146. 0030078660. Copyright © 1995 by Joseph Van Matre. Reprinted with permission of the author.

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.21 - EXAMPLE OF A CONTROL CHART

Source: From James W. Dean and James R. Evans. Total Quality, Management, Organization, and Strategy, 4th ed. Copyright © 2005 South-Western, a part of Cengage Learning, Inc. Reproduced by permission. www.cengage.com/ permissions.

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Emphasize the importance of high quality
  • Provide information, support, and feedback to help employees achieve quality
  • Let employees know quality performance is expected
  • Involve workers in achieving and controlling quality

SUPERVISOR’S ROLE IN ACHIEVING QUALITY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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EXHIBIT 14.22 - CHARACTERISTICS OF EFFECTIVE EMPLOYEE INVOLVEMENT TEAMS

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Increasing value for the customer while using fewer resources
  • Strategies
  • Eliminating waste
  • Seven types of waste: Overproduction, movement, transportation, waiting, extra processing, defects and inventory

LEAN APPROACH

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  • Just-in-time inventory control (JIT): Materials arrive as close as feasible to the time they are needed in the production or service process
  • 5s practices: Sort, straighten, shine, standardize, and sustain to promote good housekeeping

LEAN APPROACH

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Federal Occupational Safety and Health Administration, created to ensure safe working conditions for employees
  • Functions
  • Requires organizations to keep safety logs and records of injuries incurred on the job
  • Develops standards, conducts inspections, and enforces compliance by issuing citations and penalties
  • Performs pre-investigations upon invitation from the organization

OSHA

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FACTORS INFLUENCING SAFETY

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  • Human factors
  • Account for most work-related injuries
  • Technical factors
  • Unsafe mechanical, chemical, and physical conditions
  • Environmental factors
  • Agents that surround the job

CAUSES OF ACCIDENTS

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  • Push for upgraded safety equipment and safer work methods
  • Establish safety goals for the department
  • Communicate safety requirements to employees
  • Listen to complaints about safety-related matters

WHAT SUPERVISORS CAN DO TO IMPROVE SAFETY

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  • Ensure new employees understand safety rules
  • Make sure safety rules are kept up to date
  • Prohibit use of unsafe or damaged equipment
  • Encourage safety suggestions from workers
  • Post posters to reinforce the need for safety
  • Refuse to tolerate relaxed safety standards
  • Set a proper example

WHAT SUPERVISORS CAN DO TO IMPROVE SAFETY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Conduct regular safety meetings, with demonstrations by safety specialists
  • Refuse to tolerate horseplay
  • Compete with other departments in safety contests
  • Report to employees any accidents that occur elsewhere in the company

WHAT SUPERVISORS CAN DO TO IMPROVE SAFETY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Review past accident records for insights
  • Encourage reporting of unsafe conditions
  • Make regular safety inspections of all equipment
  • Include employees in periodic safety tours
  • Enforce the rules when they are broken

WHAT SUPERVISORS CAN DO TO IMPROVE SAFETY

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Look for and ensure relief from fatigue for employees
  • Investigate all accidents and remedy the causes
  • Have a system to reward excellent safety conduct

WHAT SUPERVISORS CAN DO TO IMPROVE SAFETY

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  • Cause-and-effect diagram
  • Check sheets
  • Computer-assisted manufacturing (CAM)
  • Control chart
  • Deming’s 85–15 rule
  • Flowchart
  • Histogram

IMPORTANT TERMS

  • Just-in-time (JIT) inventory
  • Lean approach
  • Occupational safety and health administration (OSHA)
  • Pareto charts
  • Productivity

©2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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  • Quality control
  • Radio frequency identification (RFID)
  • Robot
  • Run chart
  • Total quality

IMPORTANT TERMS

  • Toyota production system
  • 5S practices
  • 7 types of waste