Striving for Perfect Quality

Zero defects should be the goal for every manufacturer

Even minor quality problems can alienate customers, drive up production costs — scrapped product, reworked product, warranty and replacement costs — and erode profits.

Yet severe quality problems can do more damage by tarnishing a company’s reputation and jeopardizing its market position. For example, just as Samsung smartphones challenged Apple’s dominance, a rash of phone fires in 2016 sent the Galaxy Note 7 sales plummeting. The phones were first voluntarily recalled and then discontinued, tarnishing the brand’s image and, according to analyst Credit Suisse, costing the company up to $17 billion in lost sales(1).  In many industries, poor quality can put lives in jeopardy: In 2000, Firestone recalled 6.5 million tires associated with hundreds of deaths and injuries,(2)  with the fallout costing Bridgestone/Firestone — and its customer, Ford — billions of dollars.

While few quality problems lead to actual headlines, poor quality should be worrisome within any organization. Unfortunately, many manufacturers still haven’t heard the news:

  • Scrap/rework rates at manufacturing plants are approximately 5 percent (median), with approximately a quarter reporting scrap/rework rates in excess of 15 percent or higher.(3)
  • Finished-product first-pass-yield rates at manufacturing plants are approximately 90 percent (median), with roughly a quarter reporting yield rates of less than 80 percent.(4)
  • Warranty costs as a percentage of sales at manufacturing plants are approximately 7 percent (median), with approximately a quarter reporting warranty costs of more than 15 percent.(5)

Why such terrible quality performances? Perhaps high production volumes at some manufacturers make it difficult to maintain quality levels. Many executives believe that some quality problems are inevitable, merely part of doing business. Yet Performance Solutions by Milliken has found that by embracing a new vision of quality — Philip Crosby’s concept of zero defects(6)  — manufacturers can dramatically improve quality, costs, and customer satisfaction via:

  • Continuous skills development (CSD): Zero defects starts with educated, engaged, and empowered production employees. Every production employee can prevent poor-quality product from moving beyond their work station or area of responsibility. But to do so, they must know what constitutes poor quality. Even more important, workers must have the skills to assess why the problem occurred and how to fix it (technical and problem-solving skills). Performance Solutions encourages manufacturers to adopt standardized training processes that educate employees in doing the right things, the right way, every time — and then assess and upgrade their knowledge and performance levels.
  • Maintenance: Effort to find and fix quality problems leads to varied root causes, including machine-related errors or defects. Yet while most manufacturing executives and maintenance departments are concerned with machine availability and associated downtime, they should also focus on equipment reliability — a machine’s ability to reliably produce to specifications. A best practice is for production teams to differentiate quality problems (e.g., man, machine, material, etc.) and record data for each (e.g., problems by shift, line, type of machine, product, and material and components). This documentation will highlight the extent to which quality issues are linked to equipment problems, which can typically be resolved with improved maintenance processes.
  • Daily Team Maintenance (DTM): Maintenance isn’t just for maintenance staff. Frontline operators can be trained to perform basic maintenance tasks — machine startup, performance checks, cleaning, lubrication, etc. — to help ensure safe, continuous equipment operation. Operators often intuitively know when a machine is running properly (or not), and can serve as a defense against minor stops or equipment breakdowns. But to leverage this opportunity, companies must train operators to handle such tasks and support them with systems and standardized procedures that guide daily frontline maintenance activities. Overtime, DTM can improve production performances (including quality) while extending the lives of production assets.
  • Quality Management (QM): Perfect quality begins with prevention, but also requires a rigorous program for detection and measurement. Adherence to a quality management system, such as ISO 9001, provides routine tracking and documentation to ensure that quality parameters are met throughout production, and that goods comply with regulatory and customer requirements. In fact, in many industries, such as aerospace and defense, the ability to verify high quality is almost as important as quality itself. The discipline of Performance Solutions quality management principles can help manufacturers meet and exceed quality standards.

Perfect quality is possible — as long as executives and workers can build a new production culture focused on zero defects. Performance Solutions by Milliken can help.

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[1] Sage Lazarro, “It Looks Like Samsung Will Lose $17 Billion to the Exploding Galaxy Note 7 Fiasco,” Observer, Oct. 11, 2016.

[2] National Highway Traffic Safety Administration. October 4, 2001.

[3] MPI Manufacturing Study, The MPI Group, March 2018.

[4] MPI Manufacturing Study, The MPI Group, March 2018.

[5] MPI Manufacturing Study, The MPI Group, March 2018.

[6] Philip J. Crosby, Quality is free : the art of making quality certain, New York, Mentor, 1980.

 

 

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