CH-7-8 Quality and Innovation in Product and Process Design – Managing Quality: Integrating the Supply Chain : Book Guide

This Document Contains Chapters 7 to 8 Chapter 7: Quality and Innovation in Product and Process Design Chapter Outline Designing Products for Quality The Design Process Quality Function Deployment (QFD) Technology in Design Other Design Methodologies Designing for Reliability Environmental Considerations in Design Overview Prior chapters indicated that quality should be designed into the product as early in the process as possible and not added only after the initial design is complete. This chapter discusses the design process and how quality is an integral part. The point is made that poor quality can be an annoyance or a catastrophe. If a car battery does not hold a charge, the problem is annoying. However, if a replacement heart valve fails, the negative results are major. As life cycles for products become shorter, a focus on quality in the product design process is necessary to remain competitive. Many of the dimensions of quality discussed in Chapters 1 and 2 are addressed in the design phase of the product life. By focusing on issues such as maintainability, assembly, reliability, and product traceability, we are able to continually improve our ability to make things. Companies have implemented these processes with great results. These results have facilitated huge increases in production capacity, coupled with a reduction in cost. However, a company that does not become better at design will simply not be competitive in the future. Discussion Questions 1. Product idea generation initiates the process of designing a product by generating ideas from external and internal sources. What are some examples of external and internal sources that are used in this process? Internal sources are available within the company. The text identifies marketing, management, research and development (R&D), and employee suggestions. External sources are sources that are external to the company. The customer is the primary source for ideas. Other external sources include original equipment manufacturers (OEMs), contract manufacturers, industry experts, consultants, competitors, suppliers, and inventors. Project idea generation is the first step of the project development process. This process is described in Figure 7-2. 2. Discuss the concept of consumer future needs projection. Does a firm that excels in this area have a competitive advantage? Please explain your answer. Consumer future needs projection, step two of the project development process, uses data to predict future customer needs. The text uses the example of Intel, maker of the microprocessors for personal computers, who has mastered this process. This skill allows Intel to stay on top of a rapidly changing technical environment. A company that can accurately predict the trends in their products will have the advantage of being proactive rather than reactive. 3. What is a technology feasibility statement? Why is it important? Step three of the project development process includes a statement of feasibility. The general question is: does the state of the art allow the product or process to be created? This step includes such issues as: manufacturing imperatives, limitations in the physics of materials, special considerations, changes in manufacturing technologies, and conditions for quality testing a product. The technology feasibility statement quite simply asks the question – can this be done? 4. Briefly describe the role of computer-aided design (CAD) in the product design process. How has CAD changed the way that product designers go about their jobs? Not too long ago, design meant an acre or two of draftsmen drawing plans by hand. Today’s software has relegated that technique to the dustbin. Computer Aided Design (CAD) has simplified and streamlined the task of design. A CAD design can also be modeled by the computer, saving the expense of creating mockups and analyzing them. CAD also integrates with Computer Aided Manufacturing (CAM), thus integrating the entire process. A design is created using the computer, and is then fed into the assembly “robots” that create the product. Much of today’s automobile industry operates this way. On page 161, the text says: auto designers once had to place mock-ups of automobiles into wind tunnels to test the aerodynamics of a design. However, now the wind resistance coefficients for automobiles can be simulated on computers, cutting costs and design times and allowing for quick adjustments to the design. CAD systems help to develop more reliable and robust designs. Computer aided tools like CAD improve the ability of designers to generate new and varied designs. In addition, the design process is simplified. For example, whereas auto designers once had to place mock-ups into wind tunnels to test the aerodynamics of a design, the wind resistance coefficients for automobiles can now be modeled on computers. CAD has replaced many of the traditional tools used by designers. No longer are the tools of the designer a square, a pencil, and a drafting table. Today, most designers work at computer terminals and use CAD or similar computer applications. Currently, the industry is using multi-user CAD systems that allow many people to work on a single design concurrently in spite of geography or local time. Designers in the US, Europe, and Asia can effectively work on the same project at the same time. 5. Describe the concept of concurrent engineering. How does concurrent engineering improve the product design process? Concurrent engineering refers to the practice of performing steps in the product design process simultaneously rather than sequentially. The benefits of concurrent engineering primarily include communication and speed. By working on products and processes simultaneously, fewer mistakes are made and the time to get concept to market is reduced drastically. 6. The product life cycle for many products is getting shorter. In what ways does this trend complicate the product design process? Can you think of any advantages to shorter product life cycles for firms that have exemplary product design processes? As the product life cycle gets shorter, we are finding the roadway more complex. Many products evolve so quickly that they wind up competing with themselves. On page 166, the text states: product life cycles are becoming shorter. This means that obsolescence is a greater problem for designers and that the speed at which new product concepts are delivered to market is becoming much more important for companies around the world. The second imperative is that as product life cycles shorten, product variety and change become much more important to the successful competitor because complementary products are needed to consume productive capacity. As product life cycles shorten, the problem of obsolescence becomes more obvious. New products on the shelves make the old products less appealing. 7. What is the role of complementary products in managing the product life cycle? Complementary products use similar technologies but have a feature that differentiates them. Bringing out a new product can extend the life on an existing product. A complementary product can take basic technology and apply it for a new use. The text uses the example of motorcycles and snowmobiles. These machines use similar technology, however, they have decidedly seasonal uses. The assembly line can run year round with minor modification. 8. What is meant by design for manufacture? On page 166, the text asks, “Now that we have designed it, can we make it?” Another name for this situation is “as designed – as built.” No matter how well a product has been designed, it must able to be successfully manufactured. Operations people need to be involved in the design process. Traditionally, these departments were isolated from each other. If the communications are made simple, a better product will be produced. Design for Manufacture (DFM) refers to the practice of designing products with ease of manufacturing in mind. It involves optimizing product designs to simplify manufacturing processes, reduce production costs, and improve quality by considering factors such as material selection, ease of assembly, and process limitations during the design phase. 9. The design for maintainability concept states that a product should be designed in a way that makes it easy for a consumer to maintain it. What product attributes make it easy for a product to be serviced or maintained? A common complaint today is that products are cheaper to discard than fix. With a bit of research, a computer printer can be found for under $50.00. The ink cartridges cost about the same price. Where is the incentive to keep the printer? On page 169, the text provides a list of factors that should be considered when “designing for maintainability”: Components that are easily replaced Components that are easily removed with standard tools Adequate space to perform the maintenance function Nondestructive disassembly Safe maintenance Available and adequate owner's manuals and documentation (e.g., wiring diagrams, help facilities, or videos showing how to perform minor repairs) As products become more complex, the probability that they will require maintenance becomes higher. A company that has planned for that maintenance will keep its customers. 10. What is the over-the-wall syndrome? How can the over-the-wall syndrome be avoided? Today’s complex products are generally constructed of many sub-systems. These sub-systems must operate together. For example, a car has a fuel system, a transmission, a drive train, and a cooling system. These systems operate interactively. A point where they do not interface well could spell failure. The over-the-wall syndrome occurs when the engineers who are responsible for producing the various sub-systems do not effectively communicate. Department A designs system A and then throws it “over-the-wall” for Department B to design system B. The design for manufacture (DFM) method directly addresses this potential problem. Under DFM, there is an established procedure for multiple departments working on the same product. There is also a procedure for reworking a design that does not fit with another assembly or system optimally. 11. Define component reliability and system reliability. What is the major difference between these two concepts? Component reliability is defined as the “probability” that an individual component will fail during its anticipated lifespan. System reliability refers to the probability that a system of components will function over their anticipated lifespan. System reliability is a factor of the reliability of multiple components. 12. Describe the concept of failure modes and effects analysis (FMEA). What is the end result of an FMEA analysis? What are some of the ancillary benefits that can be derived through engaging in FMEA? The texts definition, on page 171, is: Failure modes and effects analysis (FMEA) systematically considers each component of a system, identifying, analyzing, and documenting the possible failure modes within a system and the effects of each failure on the system. It is a bottom-up analysis beginning at the lowest level of detail to which the system is designed and works upward. FMEA is a systematic procedure that identifies and documents the possible failures within a system and the effects of these failures. Page 171 lists some of the advantages of FMEA as: 1. Improvement of the safety, quality, and the reliability of product 2. Improvement of a company’s image and its competitiveness 3. Increased satisfaction from a user standpoint 4. Reduction in product development cost 5. Record of actions taken to reduce a product risk FMEA is an integral part of Six Sigma, which is covered in Chapter 1. 13. What is the primary purpose of conducting a fault-tree analysis? As with FMEA, fault-tree analysis is an organized manner of analyzing potential areas for the occurrence of fault. FTA graphically describes the possible combination of various faults that can lead to system-wide failure. While a specific component failure might not bring a system down, a combination of these component failures can result in system failure (see question 11). FTA provides a graphic manner of identifying these combinations. 14. Describe a method for identifying ways in which an engineered system could fail. What is the primary goal of this method of analysis? Failure modes, effects, and criticality analysis (FMECA) is another manner of identifying potential failures. FMECA is essentially an extension of FMEA. FMECA, however, locates each possible failure, assigns the probability of failure, and allows the assignment of priorities. On page 174, the text provides a list of the steps involved in FMECA: 1. A description of the product’s function 2. Listings of the potential failure modes 3. Potential effects each failure mode could have on the end user 4. Potential causes of each failure mode with the likelihood ranking for each 5. Preventive measures in place for firmly scheduling by the time production starts 6. Ranking of the effectiveness of each preventive measure 7. A ranking of the difficulty of detection 8. An estimate of the probability that the cause of a potential failure will be detected and corrected before the product reaches the end user 15. Discuss the importance of product traceability and recall procedures. Why is product traceability considered an important consumer safety issue? Some months ago, I brought my wife’s minivan into the dealership for some scheduled maintenance. While we were in the process of doing the paperwork, the auto technician pulled a list of all maintenance that should have been performed and which items had not been done on our car. By using the vehicle’s Product ID Number (PIN), they were able to identify all of the maintenance that any dealership had performed on the van. As vehicles (or any product for that matter) become more complex, a methodology for tracking the individual product can save money, reputation, and lives. 16. What environmental considerations are important for product designers? Do you believe that environmental considerations will become more important or less important in the future? Explain your answer. Environmental concerns have been a major news story since Rachel Carson wrote Silent Spring. The consumer has been educated to look for the environmental concerns of the products that they buy. This is in addition to the various legal restrictions. On page 175, the text discusses the move to green manufacturing and discusses the move to the life-cycle approach to product design as a partial remedy to this concern. The three environmental considerations that are important for product designers mentioned in the chapter are: design for reuse, design for disassembly, and design for remanufacture. The text uses the Kodak FunSaver camera as an example. 87% of each camera is either recycled or reused. In addition, Kodak subcontracted with a company named OutSource, a New York state sponsoring organization that employs handicapped people, to take the cameras apart. 17. Compare the job of a product designer 20 years ago to the job of a product designer today. In your opinion, what has been the single most significant technological advancement that has changed the job of a product designer? The increasing rate of change in technology in the last twenty years is unprecedented. The list might include such concepts and tools as: robotics, integrated computers, new materials and production techniques, educated consumers, and massively improved communications techniques. Any of these advancements, in addition to many not listed, would greatly change the job of the product designer. Case 7-1: Keeping Apple's IPhone Competitive 1. The case discusses the issues of trade-offs in design. What are some smartphone trades-offs? Why are these important to consider in design? Battery life, multitasking, camera, and interfaces with social networks are some of the trade-offs that need to be considered for a smartphone. Trying to incorporate all of these into the initial design can be complex and costly, so Apple must make the right choice as to what to include and when and how the customer will respond to these added or not added features. 2. Choose another product besides a smartphone. What are some important trade-offs for that product design? Students could choice a myriad of technical products to discuss, laptops, TVs, MP3 players, etc. In all these products, they will talk about features such as speed, size, compatibility, ease of use, etc. They should mention the benefits of these items and what the results would be for the customer if these features were included or not. For a bicycle, important design trade-offs include: 1. Weight vs. Strength: Lighter materials can improve performance but may compromise durability. 2. Cost vs. Quality: High-quality components improve performance and longevity but increase cost. 3. Aerodynamics vs. Comfort: Streamlined designs enhance speed but may reduce rider comfort. 4. Speed vs. Stability: Faster bikes might offer less stability, affecting safety. 5. Portability vs. Functionality: Foldable or compact designs improve portability but may sacrifice functionality or features. 3. How should Apple evaluate the “quality” of its iPhone? As one reviewer put it, “The iPhone is the smartest smart phone out there. It works just like the commercials. It is that smooth and usable.” (Source: http://ergonomics.about.com/od/buyingguide/fr/iphone.htm) Every aspect of the user experience has been thought out. Using the device and the applications is intuitive. And the transitions between the applications are natural. The applications are quick and easy to pick up, set up, and use. You have the most commonly used applications right out of the box. It still remains to be seen if you'll be able to add new applications or Apple widgets, but with a device like this, you would expect that capability. How do you know when usability has been enhanced? After a day of playing with the iPhone, I found myself trying to grab the screen on my laptop with the cursor and flicking with my touch-pad. It didn't work, of course. One of the biggest questions surrounding the iPhone has been whether the interface is really intuitive. How do you find out? You use it without reading the manual. The iPhone doesn't come with one anyway. You can also give the iPhone to someone technically illiterate. I handed mine over to my father. After two minutes of playing with it, he said, "Yep, I can use it." That is quite an endorsement. In short, the iPhone lives up to all the hype. They got it right with this one. 4. How could Apple improve its design processes for the iPhone? One thing they could keep in mind is the Kano Quality Design Model, shown here. The model shows that quality is a function of fulfilling customer requirements and achieving high levels of satisfaction. The goal should be exciting quality. As students discuss the model, they should realize that as time passes, customer demands will increase and what was once exciting will become a basic expectation, as Apple has seen in its various generations of the iPhone. Case 7-2: Nucor Corporation: Producing Quality Steel By Stressing Sound Management Practices 1. This chapter has emphasized process design. At Nucor, do human resources processes affect product quality? Most definitely yes, human resource processes are integral to their success. The success is summed up at the end of the case: The amazing thing about Nucor’s success is that it is so simple: Give employees a stake in the company’s growth; focus on the business at hand; keep red tape and bureaucracy to a minimum Employees are motivated by a culture that rewards their participation. This empowerment is facilitated by the fact that there are only four levels between the CEO and frontline employees. 2. How do Nucor’s management practices affect its capability to produce high-quality products? Make your answer as substantive as possible. Nucor’s management practices drive self-motivation. Decisions are driven to the lowest level. The front line is empowered to make decisions. The front line employees are recognized and rewarded financially for their participation. Nucor's management practices affect its ability to product high quality products by eliciting commitment and discretionary effort from employees. Nucor is designed to be a high performance organization. That design contributes to the company's efforts to produce high quality products. 3. Would you enjoy working at Nucor? Why or why not? An employee who does not allow mediocrity to be a personal identity will thrive in this environment. This management style is pure Theory Y: it appeals to the individuals who see themselves as self-motivated and self-actualized. The case states that: In return for the generous compensation package, Nucor holds its employees to a high standard. Decision-making is pushed down to the factory floor in many instances, requiring mental toughness and continuous education on the part of the company’s employees. The company also asks its employees to be prompt and fully engaged in their jobs. A person who wants to excel and is driven by personal pride will thrive. A person who is simply driven by salary only will probably not succeed here. Suggested Answers to End of Chapter Problems Flowchart the design and production process for writing a book such as Managing Quality: Integrating the Supply Chain. Use the standard process for designing products in the chapter. The standard process demonstrated is the chapter is as follows: Product idea generation: The author submits a proposal to a publisher. The proposal is sent out for review. Feedback from the reviewers is used in determining whether or not to proceed with the project. Customer future needs projection: Part of the initial proposal includes a forecast of the market for the book. The author identifies potential markets and the publisher does due diligence to determine the size of these markets. Technology selection for product development: A decision is made in the process whether to publish a hardback or paperback book. Design decisions are made such as whether or not the book will be in color or black and white. These decisions are made based on the size of the market for the book. A quality management book is a “small market” book when compared to an introductory business statistics book that is a “large market” book. Small market books will be printed in 1 color, usually black. Technology development for process selection: The publishers have existing relationships with development companies, both domestic and international. Final product definition: The author completes the manuscript and submits it to the publisher, who has it copyedited and develops a final production schedule. The compositors and the author then proceed through a series of proofing steps. There may be outside fact checkers for quantitative material. Product marketing and distribution preparation: The marketing plan is developed by the marketing and distribution specialists. Product design and evaluation: This probably is most analogous to the proofing stages. Manufacturing system design: The printer develops the printing process for the book. Product manufacture, delivery, and use: These are self-explanatory. 2. Define key customer requirements for a pen. Next, define key technical requirements for the pen. Create a matrix showing the relationships between technical and customer requirements using the QFD format. Answers may vary. This is an example: Example Customer Requirements: Pen should not leak. Pen should write reliably. Pen should be comfortable to the grasp. Ink should not smear. Related Technical Engineering Requirements: Uniform ink drop Ink viscosity Biometric design elements Pressure to release ink Customer Requirements: 1. Smooth writing experience 2. Comfortable grip 3. Reliable ink flow 4. Durable construction 5. Aesthetic design Technical Requirements: 1. High-quality ink formulation 2. Ergonomic grip design 3. Precision ink delivery system 4. Robust materials 5. Attractive design elements QFD Matrix: 3. Define key customer requirements for an automobile windshield. Next, define key technical requirements. Create a matrix showing the relationships between technical and customer requirements using the QFD format. Customer Requirements: Good visibility Not too hot in car Car is attractive Good gas mileage Technical Requirements: Pitch of windshield Type of glass Window tinting Window dimensions 4. For the QFD problem 4 matrix, compute the: Customer requirements absolute weight Technical requirements absolute weight and factor Technical requirements relative weight and factor Which design and technical factors should be emphasized? Why? Emphasize technical requirement 3 because its absolute and relative weight factors are higher than other factors. 5. For the QFD problem 5 matrix, compute the a. Customer requirements absolute weight b. Technical requirements absolute weight and factor c. Technical requirements relative weight and factor d. Which design and technical factors should be emphasized? Why? Technical Requirement 3 because its absolute and relative weight factors are higher than other factors. 6. For the QFD problem 6 matrix, compute the: Customer requirements absolute weight. Technical requirement absolute weight and factor Technical requirement relative weight and factor Which design and technical factor should be emphasized? Why? Focus on technical requirement 3 first. That is what has the highest factor when considering market impact and design imperatives. 7. What are the important design elements for a pair of pants? Respondents may give some of the following responses: Customer requirements - Do the pants fit properly? - Are they the correct length? - Are they the right color? - Does the zipper work properly? - Any visible flaws? Technical requirements - Fabric density - Color intensity - Zipper capture straight - Stretching strength Using the QFD format, show the relationships (with strengths, i.e., 1, 3, or 9) between a and b above. For example, students might rank the relationship between the zipper working properly and the zipper capture being straight as a 9. Important design elements for a pair of pants include: 1. Fit: Ensures comfort and suitability for various body types. 2. Fabric: Affects durability, comfort, and functionality (e.g., cotton, denim, synthetic). 3. Cut and Style: Defines the shape and look (e.g., straight-leg, skinny, bootcut). 4. Waistband: Provides fit and comfort, often adjustable or elastic. 5. Pockets: Functional placement and design for usability. 6. Seams and Stitching: Impacts durability and aesthetics. 8. Using the format in Figure 7-15, develop an FMEA for a pair of women’s panty hose. For this problem, have students use the template in the chapter and brainstorm the requirements for a pair of panty hose. FMEA for Women’s Panty Hose Explanation: • Severity: Impact of the failure mode. • Occurrence: Likelihood of failure. • Detection: Ability to detect before reaching the customer. • RPN: Risk Priority Number (Severity x Occurrence x Detection). Chapter 8: Designing Quality Services Chapter Outline Differences between Services and Manufacturing What Do Services Customers Want? SERVQUAL Designing and Improving the Services Transaction The Customer Benefits Package Service Transaction Analysis Improving Customer Service in Government Quality in Healthcare Supply Chain Quality in Services A Theory of Service Quality Management Overview To provide quality service, we need to examine the service and understand it to the same level as we did a product. Even manufacturing firms depend on service at some point in the product life cycle. Quality service is therefore important in both the service and manufacturing environment. Both the service and manufacturing depend on satisfied customers for continuing business. This chapter discusses the factors of service, both from a generic and a quality perspective. It then discusses some of the tools such as SERVQUAL and gap analysis that can be used to enhance a quality service environment. Discussion Questions 1. Discuss the ways in which services are unique in comparison with manufactured goods. How do these differences affect the management of service quality? The text discusses a few differences: Services tend to be intangible. They cannot be picked up and carried out or stored in inventory. Products have definite physical attributes. On page 182, the text calls services heterogeneous. Each occurrence of a service is to some degree unique. Customers tend to be more involved in the production of a service as opposed to a manufactured product. The production and consumption of a service frequently occur simultaneously. 2. Provide an example of customer coproduction other than the example provided in the text. What are the advantages and disadvantages of customer coproduction for service providers? The text defines coproduction as a situation wherein the customer and the service provider work closely to produce the service. The examples used by the text are: a haircut during which the customer is observing the barber while the barber works; a hired consultant who works closely with the company’s personnel; and patrons filling their own drinks at their table. There are a myriad of other examples. The tax accountant and taxpayer going over a tax return come immediately to mind. In a situation like this, the closeness of the customer and provider can yield problems as well. Work habits, sanitation, and different perspectives of service requirements can interfere with providing the service. In a food-oriented environment, sanitation and cleanliness become apparent. 3. Are quality techniques in the service industry well developed or still fairly immature? If you believe that they are immature, why do you think that this is the case? Answers will vary. The text does not address this point specifically, however, it does make a point of mentioning that product quality has a longer history than service quality. The example used is that the ski resorts in the Rocky Mountain region are still being plagued by lawsuits over injuries. In some states, laws protect ski resorts from lawsuits. Other states do not have these laws. The comparison is made between product liability and service malpractice. On page 184, the topic is summarized as: Services do not have as long a history of quality practice as does manufacturing. Although many quality techniques such as control charts have been adopted by services companies, this trend is still new. Certainly, as time passes, more quality techniques are being developed specifically for services. This topic should make a lively class discussion. Quality techniques in the service industry are still relatively immature compared to manufacturing. This is because services are intangible, vary greatly by provider, and involve complex human interactions, making standardization and measurement challenging. The focus on customer experience and real-time delivery also adds complexity, leading to ongoing development in quality management techniques. 4. Why do you believe that quality techniques in the service industry are less mature than quality techniques for manufactured products? What can be done to bring quality techniques for the services industry up to a higher level? As discussed in question 3, product quality has been in existence far longer than service quality. Tools such as SERVQUAL and gap analysis are being pressed into use. Concepts like the interrelationships between the components of a service, service quality definitions, and tracking are new. Some service-connected industries are showing major growth. Stock brokerages have become major companies and are heavily committed to using highly technical solutions to their problems. The growth of many service companies will be contingent on their ability to provide an effective level of service. As was said before, the customer or client is more involved and more likely to be a co-producer in a service relationship. Poor quality will rapidly become self-evident. 5. Discuss the distinction between voluntary services and involuntary services. Why is this distinction important in our understanding of service quality? When we seek and employ a service, it is a voluntary service. Examples are gas stations, tax preparers, or carpenters. If we go to the doctor’s office, then the doctor is providing a voluntary service. If, however, we go to the emergency room, the doctor we see is providing an involuntary service. While the tax preparer that we hire is a voluntary service, the IRS agent that audits our return is an involuntary server. If the service is one over which we have no control, it is an involuntary service. The agent at the Department of Motor Vehicles is providing an involuntary service. You have no choice about who or when to seek this service. Since we have little or no control over involuntary services, there is frequently a lack of service quality. Voluntary services are seeking your business; involuntary services do not have that problem. Recently, there has been an effort on the part of many involuntary services to improve quality even though the consumer has no direct control over the quality of the service. Today, the provider is frequently a government employee and is thus sensitive to the public’s needs. 6. Are the Baldrige criteria applicable to service situations? If so, how? The Baldrige Award is given in five categories: manufacturing, service, small business, education, and healthcare. (Education and healthcare were added in 1999.) Several service companies have won this award and in this era of global competition, quality is evident in any competitive business situation. 7. List Zeithamel, Parasuraman, and Berry’s five dimensions of service quality. Is the list identical for every service provider, or does it vary from company to company? Explain your answer. Zeithamel, Parasuraman, and Berry identified five dimensions of service quality: tangibles reliability responsiveness assurance empathy While this list is very comprehensive, it is by no means inviolate. On page 185, the text tells us that each service must examine its own dimensions of quality. There is frequently a dimension that is not included in this list, yet is equally important. The list is a guideline, not a law. 8. Discuss some of the qualities of an effective leader in a service context. Zeithamel, Parasuraman, and Berry stress leadership as a key value in service quality. On page 185, Table 8-1 lists the dimensions of leadership as: service vision, high standards, and in-the-field leadership style. These are all active attributes. To be a leader in an industry, the firm must actively pursue and have a valid vision of what service quality actually is. This must be part of the makeup of the firm. A leader must demonstrate high standards at all times. Leadership must be real and out in front of the firm. An example might be Sam Walton visiting each one of his stores regularly. 9. What is SERVQUAL? How does SERVQUAL help a firm assess its service quality? Zeithamel, Parasuraman, and Berry developed SERVQUAL as a tool to evaluate service quality. This tool allows the firm to use an approach other than statistical quality control to obtain a measure of the effect that their quality has on the service being provided. On pages 188 and 189, the text presents samples of the forms that are the basis of the tools. 10. What are the advantages of the SERVQUAL instrument? On page 187, there is a list of the advantages of using this tool: • It is accepted as a standard for assessing different dimensions of services quality. • It has been shown to be valid for a number of service situations. • It has been demonstrated to be reliable, meaning that different readers interpret the questions similarly. • The instrument is parsimonious in that it has only 22 items. This means that it can be filled out quickly by customers and employees. • Finally, it has a standardized analysis procedure to aid interpretation and results. SERVQUAL provides a way to quantify both customer expectations and customer perceptions. This tool allows the firm to use an approach other than statistical quality control to obtain a measure of the effect that their quality has on the service being provided. 11. Discuss the concept of gap analysis in the context of a SERVQUAL assessment. Gap analysis looks at the “gap” between customer expectations and customer perceptions. SERVQUAL questionnaires are specifically designed to enable this analysis. On page 190, Figure 8-3, five principle gaps are illustrated. 12. What is a service blueprint? How is a service blueprint developed? A service blueprint is a graphic representation of the steps involved in performing a service. The blueprint identifies potential failure points. On page 195, Figure 8-5, the process of performing the services of a hair salon are blueprinted. Note that the fail-point “wrong color” is identified, as are the steps needed to rectify the failure. The blueprint also identifies those aspects of the service that are visible to the customer as well as those that are not visible. 13. Describe the concept of moment of truth in a service context. Describe a moment of truth that you recently experienced as a consumer. Was your service experience satisfactory or unsatisfactory? Explain your answer. The moment of truth is that moment when the customer notices that there is a problem with the service. Either an expected service does not occur, or a service is performed that is not up to the customer’s expectations. The blueprint in question 12 identifies the moment when the customer looks and sees that the hair is the wrong color. A good blueprint will identify these possible moments of truth. Moments of truth occur regularly. The one that immediately comes to mind is cutting into a steak and finding it either too well done or too rare. The moment of truth occurs when the service and the customer meet. This topic is ideal for a class discussion. 14. How can the moment-of-truth concept be used as a training tool in a service setting? On page 197, the text identifies three basic approaches to using the moment of truth concept as training. Poka-yoke (or fail-safes) is designed to isolate potential areas for failure and insure that they do not happen. Three classifications are identified: warning methods, physical contact methods, and visual contact methods. Using these procedures, the process is designed not to fail. The Three T’s identify ways of planning not to fail. They offer a set of distinct items that can be observed and focused on. A Closer Look at Quality 8-2: Quality in Health Care, in the text, illustrates a situation when the moment of truth concept was used successfully to improve the service that a company provides. 15. What is a customer benefits package? What is the purpose of developing customer benefits packages in a service context? A CBP consists of both tangibles that define the service as well as intangibles that make up the service. The tangibles are known as good content. Intangibles are referred to as service-content. Customer benefits packages are important not only in that they help define what it is that your service firm will provide to the customer, but they are also used to help define what will not be provided to the customer. Figure 8-7 shows the process of developing a customer benefit package. 16. In what ways will the globalization of services alter the way that businesses manage their service quality? We have seen major worldwide changes in that last two decades. Countries that were formerly heavy manufacturing countries, such as the U.S., Japan, India, and much of the EU, have developed into service-based economies. Technical support and software development have moved to other countries where they can be supplied at a better price. Countries such as Singapore and Thailand, that were recently considered “third world,” are now becoming major suppliers of manufactured equipment. Businesses now have a new set of priorities to consider. Outsourcing and insourcing have become major items in computing the bottom line. Just as American companies have gone overseas to take advantage of the business environment, foreign companies such as Toyota and Honda now have a manufacturing presence in the United States. 17. Discuss the initiatives that the U.S. government has taken to increase its emphasis on service quality. Are they effective? The text starts this section with the statement: If customer service is the battlefield for business in the twenty-first century, then government is probably the last frontier. The term “government service” has been considered an oxymoron. Voters have been getting more involved in the way our governments—local, state, and federal—conduct business. Recently, there was a complete overhaul of the customer service arm of the IRS. The text notes several factors that seem to be driving change in the government’s adaptation of quality techniques. These factors include: People want and desire to do good quality work. Because quality management is associated with improved employee satisfaction, there is a major impetus to improve. Government leaders are mandating standards, strategic plans, and new levels of performance at all levels of government. These standards are being adopted in government agencies because of the mandates. Demand for government services is growing at a faster rate than funding for them. The natural reaction is to simplify processes that have become bloated. Finally, the threat of privatization in government has led to an improvement in service in many areas. 18. Discuss several of the factors that have contributed to an increase in attention directed toward quality in health care. Every newscast or newspaper seems to have a comment on the rising cost of healthcare. The Baby Boomers, a huge proportion of our society, have aged and have greater need for medical assistance. The rising price of utilities affects every situation. On page 203, the text lists the following: Healthcare is facing the same “cost squeeze” that government is facing. A move toward health maintenance organizations (HMOs) is causing hospitals to streamline operations. There is increasing diversity in healthcare. Given this situation, healthcare is under increasing pressure to improve quality and reduce costs. While these two concepts are apparently at odds, the situation must be handled. 19. Discuss the unified theory for services management developed by Dr. Scott Sampson. Do you agree or disagree with the principles underlying Sampson’s theory? Explain your answer. The Unified Theory of Services Management developed by Dr. Scott Sampson provides unique insight into the challenges of service management. Dr. Sampson's theory is based on four propositions: Unified Services Theory The Unreliable Supplier Dilemma Capricious Labor Everyone Thinks They're an Expert Dr. Sampson is taking a pragmatic look at the reality of the situation. Is this pragmatic view correct? This question is essentially a review of the entire chapter. 20. In your judgment, will the management of “service quality” ever progress as far as the management of “manufactured goods quality”? Please make your answer as substantive as possible. To answer this question and lead the class through a discussion, it is probably wise to start with a list of the differences between service and manufactured goods quality. What are the factors that make service quality unique? What are the factors that make manufactured goods quality unique? What environmental, technological, and social factors influence this decision? Yes, the management of service quality will progress to match the management of manufactured goods quality. Advances in technology, data analytics, and process standardization will enhance the ability to measure, monitor, and improve service quality. As organizations increasingly adopt best practices from manufacturing, such as Six Sigma and Total Quality Management, and focus on customer experience and real-time feedback, service quality management will become more refined and comparable to manufacturing quality management. Case 8-1: Google Designs Quality Services with Customers in Mind 1. Think about the Internet search engine that you use the most often. If it is Google, what is it about Google that attracts you as a user? If it is not Google, what could Google learn from the search engine that you use that could help make it better? Search engines such as Google and Yahoo! are no longer simple search engines: the functionality has expanded to include many services. They both have a rich set of business functions. Google has branched out to include a host of resources and office software; Yahoo provides Internet hosting through its affiliate Geocities as well as a suite of essential services. In addition, Internet Service Providers (ISPs) are competing with similar sets of services. The student might make a list of some of the more common search engines and ISPs and the services that they provide. If I use Google, its appeal lies in its speed, accuracy, and user-friendly interface, along with the relevance of search results and extensive features like Google Maps and Google Scholar. If I use a different search engine, such as Bing, Google could learn from its unique features like integrated rewards programs or different search result presentations to enhance user engagement and experience. 2. What parallels do you see between developing a high-quality service product and a high-quality manufactured product? Make your answer as substantive as possible. One reason that Google has established such a large customer base is that it has worked hard to determine what its customers want and has designed features into its website to meet its customers’ needs. The fact that it is an online service implies that its customers are highly computer literate and better able to communicate with the company. The producers of manufactured products should be equally as committed to finding out what its customers want and produce products to meet those needs. However, they do not have that built-in advantage of a well-trained user community. Service products (in general) seem to do a better job of soliciting feedback from their customers than the producers of manufactured goods. 3. Is Google a company that was simply at the right place at the right time, or are many of its service innovations truly unique? Explain your answer. Did Google create its niche? Google provided a complete environment for the user. The environment included email services, instant messaging, and a search facility. They have built their base with an increasing number of services. Google's success is attributed to both being at the right place at the right time and its unique service innovations. While it capitalized on the growing importance of the internet and search engines, its innovations, such as the PageRank algorithm, personalized search, and integration of various services (e.g., Google Maps, Google Drive), have set it apart from competitors and contributed significantly to its dominance in the market. Case 8.2: UPS: Delivering the Total Package in Customer Service 1. Based on the description of UPS, what do you believe are UPS’s strengths and weaknesses? Much like Yahoo!, UPS created its own niche market. This has spawned a host of competitors such as Federal Express. The United States Postal Service (USPS) has built its own competitive organization. The services have grown to include overnight letter services, pick-up, and delivery. This has become a highly service-automated and technically-oriented market. How do the students react to the various competitors in this market? Strengths of UPS: 1. Global Network: Extensive logistics and delivery infrastructure enabling efficient global operations. 2. Reliability: Strong reputation for on-time deliveries and dependable service. 3. Technology Integration: Advanced tracking systems and optimization technologies improve efficiency. 4. Brand Recognition: Established brand with significant market presence and customer trust. Weaknesses of UPS: 1. High Operational Costs: Maintaining a vast network and fleet can lead to significant expenses. 2. Dependence on Economic Conditions: Vulnerable to economic downturns affecting shipping volumes. 3. Service Disruptions: Potential for service interruptions due to weather or other external factors. 4. Complex Logistics Management: Managing a large network can lead to operational challenges and inefficiencies. 2. How has UPS used technology in its design of quality services? Make your answer as substantive as possible. Today, a package or letter can be tracked nearly moment by moment. Each point of receipt or shipment tracks each parcel electronically. How does the class feel this works? Has the competition been able to successfully compete in this market? UPS has leveraged technology in several key ways to enhance the quality of its services: 1. Package Tracking: Advanced tracking systems allow real-time visibility of shipments, improving transparency and customer satisfaction. 2. Route Optimization: UPS uses algorithms and data analytics to optimize delivery routes, reducing fuel consumption and delivery times. 3. Automated Sorting: Technology-driven sorting systems increase efficiency and accuracy in handling packages. 4. Driver Support: Tools like the UPS Orion system provide drivers with optimized routes and real-time traffic updates, enhancing delivery performance. 5. Customer Interfaces: Online tools and mobile apps enable easy package tracking, scheduling, and customer support. These technologies contribute to UPS's operational efficiency, reliability, and overall service quality. 3. Describe a positive or negative experience that you have had with UPS (or one of its competitors such as FedEx or the U.S. Postal Service). If the experience was positive, reflect on whether the experience is consistent with UPS’s new emphasis on customer needs. If the experience was negative, what could UPS have done to better satisfy your need? A few situations in which one can differentiate between these services include normal transactions, important rush services, and high volume periods such as the winter holiday season. How do the various services react to these situations? What are the students’ personal experiences? What conclusions can be drawn? How can the concept of quality be integrated or measured? Positive Experience: I had a positive experience with UPS when a package I ordered arrived ahead of schedule and in excellent condition. The real-time tracking updates were accurate, and the delivery was prompt. This aligns well with UPS’s emphasis on customer needs by ensuring reliable and timely service, enhancing customer satisfaction through transparent tracking, and meeting delivery expectations. Negative Experience: In contrast, a negative experience involved a delayed delivery due to a misrouted package, which was not updated in the tracking system for several days. UPS could have improved this experience by providing more frequent updates, better communication regarding delays, and quicker resolution of the issue. Enhanced customer support and more accurate tracking information could have mitigated the inconvenience. Suggested Answers to End of Chapter Problems 1. A national electronics retail chain charges $350 for a service contract. Of this, the company sends $120 to an insurer. Calculate the profit margin for the service contract. The company makes $350 - $120 = $230 for the service contract. $230/$350 = 65.7% contribution to profit excluding taxes or other administrative expenses. 2. Using the example of the service transaction analysis (STA) worksheet, chart and evaluate the transactions for your university or college advising office. Report your findings and overall evaluation. Answers will vary. Below is a template to distribute to the students: Service Transaction Analysis (STA) for University Advising Office: Transactions: 1. Initial Appointment Scheduling • Steps: Contact office, select appointment time, confirm via email. • Evaluation: Smooth process but occasional delays in confirmation. 2. Advising Session • Steps: Meet advisor, discuss academic plan, review progress. • Evaluation: Generally effective, but sessions can be rushed due to high advisor workload. 3. Follow-Up Communication • Steps: Receive follow-up email, address additional questions. • Evaluation: Good response time, but sometimes lacks detailed guidance. 4. Issue Resolution • Steps: Report issue, advisor provides solution or referral. • Evaluation: Effective resolution, though complex issues can take longer. Overall Evaluation: The advising office generally performs well in managing appointments and providing support, but improvements could be made in appointment confirmation speed and ensuring adequate time for advising sessions. Enhanced follow-up communication and streamlined issue resolution processes could further improve service quality. Develop a consumer benefits package for a service business in your community. Be exhaustive and explicit in you package identification. For this, the students should use Table 8-3 as a guide. They should go to a business and interview the management to help them define a benefits package. This is a very good team project that the author has used with good results. Consumer Benefits Package for a Local Coffee Shop: 1. Product Quality: Freshly brewed coffee, diverse beverages, and fresh pastries. 2. Customer Experience: Cozy atmosphere, free Wi-Fi, and friendly staff. 3. Convenience: Online ordering, drive-thru service, and flexible hours. 4. Loyalty Program: Points system for rewards and exclusive offers. 5. Sustainability: Eco-friendly packaging and support for sustainable sourcing. Develop a services blueprint for a local car wash. Identify possible fail points, back-office processes, and fail-safes. This is another problem that can be used with teams or individuals to get them into the real business community and get them to use these tools in a real, albeit simple setting. Use Figure 8-5 as a guide. They may want to use the flowcharting tool in PowerPoint to do this. Service Blueprint for a Local Car Wash: 1. Customer Actions: • Arrival: Customer drives into the car wash. • Selection: Chooses a service package (e.g., basic wash, deluxe). • Payment: Pays at the kiosk or cashier. • Car Preparation: Removes personal items from the car. 2. Frontstage (Visible) Processes: • Vehicle Inspection: Staff inspects car for damage and records it. • Wash Process: Car enters wash tunnel; automated equipment cleans the car. • Drying and Detailing: Car is dried and detailed by staff. • Inspection: Final check to ensure service quality. 3. Backstage (Invisible) Processes: • Equipment Maintenance: Regular maintenance of washing and drying equipment. • Supply Management: Restocking of cleaning agents, wax, and other supplies. • Staff Training: Training for staff on service procedures and customer interaction. 4. Fail Points: • Payment Issues: Problems with the payment kiosk or cashier. • Equipment Malfunctions: Breakdowns or inefficiencies in washing equipment. • Service Quality: Inconsistent cleaning or detailing results. • Customer Miscommunication: Misunderstandings about the service package or pricing. 5. Fail-Safes: • Customer Support: On-site staff available to address payment or service issues. • Regular Maintenance: Scheduled equipment checks and repairs. • Quality Control: Regular inspections and customer feedback to ensure service consistency. • Clear Instructions: Signage and staff guidance to help customers understand the process and options. 5. Recently, a medical office administered the SERVQUAL survey to its customers as a way to determine where it should focus the process improvement. Forty surveys were administered to customers before and after they were treated. On the basis of the 40 responses, the following averages were computed for each item. Using the averages in the table that follows, compute dimension averages. Based on your findings, which dimensions should be emphasized? Using the averages in the table, compute dimension averages. Based on your findings, which dimensions should be emphasized? Focus on empathy and responsiveness. 6. For the data in problem 5, perform a two-dimensional differencing analysis. Do your results differ from your answer in problem 5? Empathy and reliability should be emphasized. 7. The averages for different dimensions of service quality were computed by averaging the items pertaining to the dimensions. Use the following data to determine which dimensions to emphasize. a. Using simple differencing, determine which dimensions should be emphasized. b. Use two-dimensional differencing to determine which dimensions should be emphasized. Emphasize reliability and empathy. c. Based on your findings, choose the most important dimension and describe how you would develop a process improvement program to address the dimension that needs to be improved. Empathy should be emphasized first. Start by identifying what empathy means in terms of your business. Undertake an intensive empathy training program and monitor results using SERVQUAL to monitor improvement. 8. A state university wants to perform a gap analysis to determine what student traits corporate CEOs find most important. The exercise is to be administered to CEOs and involves two surveys – an expectations survey and a perceptions survey. All questions are answered on a 10-point scale. The attributes the CEOs are asked to rate are propensity for life-long learning, ability to work in teams, innate ability, and cognitive ability. The results of nine surveys are synopsized in the text table: Perform a gap analysis by developing a two-dimensional plane and evaluate the results. Lifelong Learning Teamwork Innate Abilities Cognitive Abilities Perceptions 2 9.33 5.33 8.89 Expectations 8 8.78 3.67 3 Differences -6 0.55 -1.66 5.89 Focus on lifelong learning. 9. Following is a transaction analysis for a movie theater. Please answer the following questions. a. Based on the service transaction analysis, what is your assessment of the movie theater? In looking at the transaction analysis sheet, we see that although the movie theater knows where the movie is playing and is very helpful in guiding their customers to the appropriate location, the overall appearance, cleanliness, and enjoyable customer experience is lacking. b. In what areas can the movie theater improve? It could have a better arrangement for the ticket line, it could clean more thoroughly, and it could pay attention to the messages being sent by coming attraction posters. Are there any additional customer touch points you can think of in this process? What could the company do to make them a positive experience? Have the students think about the last time they went to a movie. Were the coming attraction previews appropriate? How were the restrooms? What about the overall sound and picture quality of the movie itself? Once they have thought through all of the additional touch points, have them discuss what could have made this a better experience. Additional customer touch points include initial inquiry, purchase process, delivery or service fulfillment, follow-up communication, and feedback collection. To enhance these experiences, companies can: 1. Initial Inquiry: Ensure prompt and accurate responses. 2. Purchase Process: Simplify and streamline the checkout process. 3. Delivery/Service Fulfillment: Provide timely updates and ensure quality. 4. Follow-Up Communication: Reach out with personalized thank-yous or check-ins. 5. Feedback Collection: Make it easy to provide feedback and show that it's valued by acting on it. 10. Following is a service transaction analysis for a lube shop. Answer the following questions. a. Based on the service transaction analysis, what is your assessment of the lube shop? It looks like the lube shop is doing a very good job of satisfying the customer. It seems that they are doing the right things and the overall experience is a satisfactory one. b. In what areas can the lube shop improve? Although they seem to being doing a pretty good job overall, it does appear that they could provide their mechanics some training in selling additional services. The comments seem to indicate that “upselling” is annoying to the customers, which means they are being more aggressive than they might need to be. c. Are there any additional customer touch points you can think of in this process? What could the company do to make them a positive experience? Have the students think about the last time they took their car in to have an oil change. Did the facility smell clean? How were the restrooms? How was the additional services explained? Did the shop display appropriate material explaining the consequences of not having the additional services? Once they have thought through all of the additional touch points, have them discuss what could have made this a better experience. Certainly! Here are some additional customer touch points and suggestions for enhancing them: 1. Pre-Purchase Research: Offer detailed product information and comparisons on your website. Provide helpful FAQs and customer reviews to aid decision-making. 2. Customer Support Channels: Ensure multiple, easily accessible support channels (e.g., chat, email, phone) and provide timely, knowledgeable assistance. 3. User Onboarding: Create an intuitive onboarding process with clear instructions or tutorials to help customers get started smoothly. 4. Billing and Payment: Ensure transparent billing practices and offer multiple payment options. Provide clear invoices and easy-to-understand charges. 5. Post-Purchase Engagement: Send personalized follow-ups and offers. Share tips for product use or related services. 6. Problem Resolution: Implement a straightforward and efficient process for handling complaints and returns, ensuring customers feel heard and valued. Improving these touch points involves clear communication, responsiveness, and a focus on customer needs to create a seamless and positive experience. Solution Manual for Managing Quality: Integrating the Supply Chain Thomas S. Foster 9780133798258