Quality Management

A Project Management Perspective

Helgi Thor Ingason

• Editorial: Routledge
• Año: 2020
• ISBN:
  9781000033441
• Edición: 1
• Categoría: Negocios y empresa
• Categoría: Operaciones

The implementation of quality management can be seen as a sequence of projects and evolves as a result of how projects are planned, executed and closed. This book explores quality management from a project management perspective, based on the author's long experience of teaching and practicing, including the implementation and operation of quality management systems within various types of organisations.

The author explores the origins of quality management as a discipline, it's appearance in the present form and how quality management can be implemented and applied in all kinds of organisations to achieve stability and better results. The basic principles of quality management and the ISO9001 quality management standard are discussed and explained from a broad perspective, with illustrative examples from different types of organisations.

Quality Management offers a global, accessible guide for undergraduate and postgraduate university students. Written clearly and with illustrative examples, it will also appeal to all those interested in project management and quality management and wishing to expand their knowledge base.

1 The concept of quality and other basic concepts

Introduction

In this chapter, some of the basic principles and ideas behind quality management are briefly defined, put into context, and explained with ­simple examples.

The concept of quality

Let’s look at the photograph in this section (Figure 1.1). It is taken on a beautiful day and it shows mountains, the sky, sunshine, lava and moss. What comes into our minds when we look at this photograph? Some of us might think of the clarity of the air or the purity of the environment. Some might see the beauty of God’s creation and others would perhaps admire the landscape. Some of us may talk about the photograph itself, the image resolution, the perspective of the photographer, the exposure, the aperture, the focus or other technical concepts of photography.

Figure 1.1
Photograph from Heiðmörk—a preserved area close to Reykjavik (Andri Snær Helgason).

We can see that there is a variety of different possibilities if we want to discuss this photograph. Let’s explore whether or not the concept of quality has any relevance in the context of this photograph. What can we say about the photograph if the key word is to be quality? Some readers might talk about the quality of life in such beautiful and pure countryside. Others might comment on the quality of the photograph, and it would probably be tempting to talk about the high quality or low quality of the photograph. Or even the high quality or low quality of the environment. But what is the meaning of such statements? What is the benchmark when such statements are put forward? Is there a universal scale for a quality on which everyone agrees? This is, of course, not the case, and therefore it is difficult to talk generally about high quality or low quality. In fact, the term quality is probably not very useful for inspiring a discussion about the photograph.

Expectations

The term quality stems from the Latin word qualitas, which can mean character or nature. A well-known definition of the term quality is ‘fitness for use’. It is useful to divide the concept of quality and talk about two main aspects of it (Juran, 1989: p. 16) (Figure 1.2). One aspect represents the features of a product or service; the other is about delivering it without deficiencies. The features have to do with the design of the product or service—what it is intended to deliver. In the case of a product, this can refer to reliability, durability, functionality and other technical concepts. In the case of a service, this can refer to accuracy, functionality, service, knowledge and so on. Deficiencies, on the other hand, have to do with the actual delivery, delivering the product or rendering the service according to specifications and making sure that no defects or mistakes occur in the production and delivery of the product or service.

Figure 1.2
Two components of quality.

The features of a product or service have a great impact on sales income (Figure 1.3). The more features that are built into it, the higher the price tag. A market can be divided into segments, depending on the level of quality the customer requires. For instance, we can compare a budget motel and a luxury hotel, both providing similar services but with different features.

Figure 1.3
An example of a simple product—and yet with specific features.

The features of a product therefore correspond to quality of design and, on average, it can be stated that the more features in the design of a product, the higher the cost. But delivering the product without defects has great impact on the cost of production. The less raw material that is wasted in production, the fewer complaints received from customers; all of this leads to lower cost of production. There may be errors, faults, mistakes, defects and products that don’t meet the specifications. By focussing on controlling the production and meeting particular specifications, the cost of production can be reduced, the number of complaints will go down and customers will be happier.

Customers have expectations regarding both aspects of quality. If the product is a new apartment, built by a construction company and sold by the same company, the customers expect the features of the apartment to be in accordance with the initial specifications. They expect the apartment to be delivered complete, with parquet or tiles on the floors; that all equipment and systems are working properly, the yard meets the standard set out in the contract and the maintenance costs, for example, are in accordance with the initial description of the apartment. In other words, the functionality and reliability of the product should be in accordance with the advertisements and PR material and the product must be fit for use. The same applies if the product is not a tangible thing, for example, services such as legal consultancy or gym membership.

It is also possible to categorise quality features depending on their different nature. A characteristic of a product is a distinctive feature or property and it can either be inherent or assigned. Inherent characteristics can be general for all products or services—for instance, delivery time and reliability. But they can also be specific, referring only to particular products or services. Examples of specific inherent characteristics of an apartment could be a private entrance or its acoustic properties. Specific inherent characteristics can be obvious to the consumer, for example, the taste of food, but they can also be hidden, for instance, if the food contains unhealthy ingredients. Often it is the responsibility of official institutions to define requirements regarding those hidden inherent characteristics, especially if they have to do with the safety of the product or service. Characteristics of products can also be assigned, for example the price. The price is defined by the seller. The value concept is a useful tool to assess quality and price, and we will define value as the ratio between quality and price:

Value = Quality/Price

The customers will typically want to get as much value for money as possible.

Let us look back at the photograph. If a person interested in the natural landscape of Iceland asks a photographer to travel to Iceland and return with a photograph from Heiðmörk (a preserved area close to Reykjavik), he or she would probably describe some specific properties that they would like the photograph to have. For instance, the subject of the photograph, the resolution, the exposure, the aperture and other inherent characteristics. The photographer would then travel to Iceland, shoot the photograph and return to the client, who will assess whether or not their expectations have been fulfilled. Either the photograph will be accepted or it will not. It will have either the right or wrong qualities. The word quality is therefore primarily of relevance for the person defining the expectations and requirements, which, it is assumed, will be fulfilled by the seller of the product or provider of the service.

Product categories

Let’s look at another example in order to explore this in more detail. When my son was six years old, there was a McDonald’s restaurant in Reykjavik. From time to time, the idea was put forward in my small family to have a dinner at a restaurant. There were different opinions regarding where to go, but I always knew where my son wanted to eat; he would always choose McDonald’s. From my perspective, I was perhaps thinking about a restaurant offering a slightly higher standard of food, but frequently my son got to choose. If we compare McDonald’s with another popular hamburger joint in Iceland, Hamborgarafabrikkan, we can say that both restaurants offer hamburgers and similar dishes. However, the food is served differently and the environment and arrangement of the restaurants is quite different. We can therefore conclude that this is an example of two product categories. An example of the third product category would be a restaurant chain like Angus Steakhouse, which can be found in different cities of the world.

But the term quality should be used with caution. My son’s desire to visit McDonald’s is understandable. He has been there before and he knows exactly what to expect. He knows how the hamburger will taste, he knows that he will get a toy and an interesting playground. He also knows that dinner will not take too long to arrive. We have now listed the quality features that are of relevance for this young man. At McDonald’s he will always get the right quality, regardless of the location—in London, Copenhagen or Reykjavik. To some extent I agree with my son, but my expectations are somewhat different than his, the environment is important for me and I don’t particularly like the hamburgers at McDonald’s. I would choose Angus Steakhouse and, after having visited numerous franchises in different cities, I know that I will not be disappointed. The quality is therefore defined by the client and it is either right or wrong in their eyes. Talking about high quality or low quality in this context is not useful, it is much better to talk about different product categories. I might add that McDonald’s is no longer represented in Iceland.

The value chain

It is now time to introduce an important model that we will frequently refer to in this book, because it includes important concepts of quality management. This is the chain that connects the suppliers, the organisation and the customers. This model is referred to as the value chain (Figure 1.4).

Figure 1.4
The value chain, linking an organisation to its suppliers and customers.

Let’s imagine that we are in the position of an organisation that creates a product or provides a service that fulfils the expectations of its customers. But this product or service is not created out of nothing so we need to buy raw materials or services, and this is where the suppliers come into the picture. This sensitive chain defines what we could call the value creating operation of the organisation. We buy materials or services, we apply our processes and knowledge to convert these raw materials into products, which we then sell to our customers. In this process we create value that we use for paying for the cost of our operation. We also pay taxes and dividends to shareholders, if this is the case. Later we will revisit this chain and use it to explain other factors in the environment that are of relevance for the value-creating operation and can have an influence on it. One example of the value chain could be a large construction company (my organisation) that builds apartments of a high standard for retired people (customers) and hires engineering consultancies to do the necessary design for civil works, electrics, plumbing, architecture and so on (suppliers).

In the context of the idea of the value chain we should mention partnering; a form of collaboration in construction that can be used instead of more traditional bidding. Partnering represents much closer collaboration and cooperation in the value chain, starting when requirements are defined and continuing until the end of the project. The partners could be the engineers, the contractors and the operating entity, and at the beginning of the project they sign a formal agreement to conclude the project in a feasible way. Partnering demands that the partners—at the start of a project—define the nature of the cooperation, responsibility and roles. Experience shows that this effort in the early stages can lead to extensive success as well as financial savings in the short and longer term. By including the perspectives of the operating entity from the beginning it is possible to considerably reduce the life-cycle costs of the project deliverable, e.g. a building.

Quality assurance

We define the term quality assurance as providing confidence that quality requirements will be fulfilled. This means simply to assure the customer that his or her expectations of the product or service will be met (Figure 1.5). We can use simple examples to explain this. A company can build quality assur...