Operations Management: An Integrated Approach, 5th Edition

IMPLICATIONS FOR MANAGERS

In this chapter we have learned about a variety of different statistical quality control (SQC) tools that help managers make decisions about product and process quality. However, to use these tools properly managers must make a number of decisions. In this section we discuss some of the most important decisions that must be made when implementing SPC.

How Much and How Often to Inspect

Consider Product Cost and Product Volume As you know, 100 percent inspection is rarely possible. The question then becomes one of how often to inspect in order to minimize the chances of passing on defects and still keep inspection costs manageable. This decision should be related to the product cost and product volume of what is being produced. At one extreme are high-volume, low-cost items, such as paper, pencils, nuts and bolts, for which the cost of 100 percent inspection would not be justified. Also, with such a large volume, 100 percent inspection would not be possible because worker fatigue sets in and defects are often passed on. At the other extreme are low-volume, high-cost items, such as parts that will go into a space shuttle or be used in a medical procedure, that require 100 percent inspection.

Most items fall somewhere between the two extremes just described. For these items, frequency of inspection should be designed to consider the trade-off between the cost of inspection and the cost of passing on a defective item. Historically, inspections were set up to ...