Concept explainers
a)
To draw: A scatter diagram.
Introduction:
Scatter diagram:
Scatter diagram refers to the tool that shows the relationship between two variables. It is the graphical representation of two variables. In the diagram, one variable is measured on the horizontal axis and other variable is measured on the vertical axis. Scatter points were plotted at the point where both the variable intersects at each other or shows any relation between two variables.
b)
To draw: A scatter diagram.
Introduction:
Scatter diagram:
Scatter diagram refers to the tool that shows the relationship between two variables. It is the graphical representation of two variables. In the diagram, one variable is measured on the horizontal axis and other variable is measured on the vertical axis. Scatter points were plotted at the point where both the variable intersects at each other or shows any relation between two variables.
c)
To draw: A Pareto chart.
Introduction:
Pareto chart:
Pareto chart is a type of chart that includes lines and bars graph, where individual values are signified in the decreasing order by bars, and the cumulative sum is signified by the line
d)
To draw: A fishbone diagram.
Introduction:
Fishbone diagram:
Fishbone diagam is graphical represesntation of categorizing the potentitial causes of problems to determin the root causes. This diagram helps the workers to evade solutions that simply focuses on the symptoms of a larger issues.
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Principles of Operations Management: Sustainability and Supply Chain Management, Student Value Edition (10th Edition)
- Abernathy, Inc., produces two different generators and is concerned about their quality. The company has identified the following quality activities and costs associated with the two products:  Generator A Generator B Units produced 170,000  340,000  Warranty work (units) 1,700  850  Scrapped units (number) 3,400  850  Inspection (hours) 3,400  1,700  Quality training (hours) 85  85  Activities:           Performing warranty work $816,000           Scrapping units 612,000           Inspecting 306,000           Quality training 85,000   Required: 1. Calculate the quality cost per unit for each product, and break this unit cost into quality cost categories. If required, round your answers to the nearest cent.  Generator A Generator B Unit cost $fill in the blank 1 $fill in the blank 2arrow_forwardA production operation is making 150 units of a product by engaging five workers for 300 hours. However, 40% of the units appear to have various quality problems, and the company decides to sell them as seconds at a price of £50 each when a normal unit is sold for £150. To improve the situation, several initiatives are proposed, including a scheme where, for every improvement, 50% will be given to workers and the other 50% will be held by the company. This results in a significant drop in defects as now only 10 units are faulty out of an output of 130 units.- Compare the productivity after Bonus with the initial productivity. - Determine the appropriate bonus per hour for the workers under the bonus scheme if the cost per piece is £70 both before and after the scheme.arrow_forwardA bank has started a 6-sigma quality improvement program. The corporate banking department would like to use this approach to improve the corporate banking credit report preparation process. What would be the relevant performance measures related to this process?  How would you decrease the variability of these performance measures?arrow_forward
- Representatives of the Patriot Insurance Company take medical information over the telephone from prospective policy applicants prior to a visit to the applicant’s place of residence by a registered nurse who takes vital sign measurements. When the telephone interview has incorrect or incomplete information, the entire process of approving the application is unnecessarily delayed and has the potential of causing loss of business. The following data were collected to see how many applications contain errors. Each sample has 200 randomlyselected applications. Sample Defects Sample Defects 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 20 18 29 12 14 11 30 25 27 16 25 18 25 16 20 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 15 40 35 21 24 9 20 17 28 10 17 22 14 19 20 a. What are the upper and lower control limits of a p-chart for the number of defective applications? Use z = 3.b. Is the process in statistical control?arrow_forwardBecause of the poor quality of its cars, Hyundai watched its U.S. sales drop from 264,000 cars to 90,000 cars in just two years. Hyundai cars ranked 26th out of 35 car brands in terms of initial car quality as measured by the influential J.D. Power Initial Car Quality survey. With $6.6 million in debt, a $1 billion investment for a new manufacturing plant in Alabama, and the company’s first-ever loss, Hyundai’s new chairman, Chung Mong Koo, declared that improving quality was the only way to fix the company.The challenge for Chung was to get his managers to put quality, and not costs, first. So he sent a visible, meaningful message that poor quality would no longer be tolerated. During one plant visit, Chung demanded to see under the hood of a car on the production line. He was furious when he saw loose wires, tangled hoses, bolts painted four different colors - tremendous deviation from what the engine compartment was supposed to look like. On the spot, he instructed the plant…arrow_forwardBecause of the poor quality of its cars, Hyundai watched its U.S. sales drop from 264,000 cars to 90,000 cars in just two years. Hyundai cars ranked 26th out of 35 car brands in terms of initial car quality as measured by the influential J.D. Power Initial Car Quality survey. With $6.6 million in debt, a $1 billion investment for a new manufacturing plant in Alabama, and the company’s first-ever loss, Hyundai’s new chairman, Chung Mong Koo, declared that improving quality was the only way to fix the company.The challenge for Chung was to get his managers to put quality, and not costs, first. So he sent a visible, meaningful message that poor quality would no longer be tolerated. During one plant visit, Chung demanded to see under the hood of a car on the production line. He was furious when he saw loose wires, tangled hoses, bolts painted four different colors - tremendous deviation from what the engine compartment was supposed to look like. On the spot, he instructed the plant…arrow_forward
- Because of the poor quality of its cars, Hyundai watched its U.S. sales drop from 264,000 cars to 90,000 cars in just two years. Hyundai cars ranked 26th out of 35 car brands in terms of initial car quality as measured by the influential J.D. Power Initial Car Quality survey. With $6.6 million in debt, a $1 billion investment for a new manufacturing plant in Alabama, and the company’s first-ever loss, Hyundai’s new chairman, Chung Mong Koo, declared that improving quality was the only way to fix the company.The challenge for Chung was to get his managers to put quality, and not costs, first. So he sent a visible, meaningful message that poor quality would no longer be tolerated. During one plant visit, Chung demanded to see under the hood of a car on the production line. He was furious when he saw loose wires, tangled hoses, bolts painted four different colors - tremendous deviation from what the engine compartment was supposed to look like. On the spot, he instructed the plant…arrow_forwardBecause of the poor quality of its cars, Hyundai watched its U.S. sales drop from 264,000 cars to 90,000 cars in just two years. Hyundai cars ranked 26th out of 35 car brands in terms of initial car quality as measured by the influential J.D. Power Initial Car Quality survey. With $6.6 million in debt, a $1 billion investment for a new manufacturing plant in Alabama, and the company’s first-ever loss, Hyundai’s new chairman, Chung Mong Koo, declared that improving quality was the only way to fix the company.The challenge for Chung was to get his managers to put quality, and not costs, first. So he sent a visible, meaningful message that poor quality would no longer be tolerated. During one plant visit, Chung demanded to see under the hood of a car on the production line. He was furious when he saw loose wires, tangled hoses, bolts painted four different colors - tremendous deviation from what the engine compartment was supposed to look like. On the spot, he instructed the plant…arrow_forwardEach day, a FedEx competitor processes approximately 50,000 shipments. Suppose that they use the same Service Quality Index as FedEx and identified the following numbers of errors during a 5-day week (see the "FedEx: Measuring Service Performance" box). These values are hypothetical and do not reflect any real company’s actual performance. Description Weight Number of Errors Complaints reopened 3 145 Damaged packages 10 17 International 1 109 Invoice adjustments 1 284 Late pickup stops 3 207 Lost packages 10 4 Missed proof of delivery 1 28 Right date late 1 752 Traces 3 115 Wrong day late 5 11 Compute the Service Quality Indicator by finding the weighted sum of errors as a percentage of total shipments. Do not round intermediate calculations. Round your answer to three decimal places. Service Quality Indicator (SQI):  %arrow_forward
- In response to intensive foreign competition, the management of Florex Company has attempted over the past year to improve the quality of its products. A statistical process control system has been installed and other steps have been taken to decrease the amount of warranty and other field costs, which have been trending upward over the past several years. Costs relating to quality and quality control over the last two years are given below:   Costs (in thousands) Last Year This Year Inspection $ 720 $ 909 Quality engineering $ 450 $ 765 Depreciation of test equipment $ 675 $ 270 Rework labor $ 1,080 $ 1,530 Statistical process control $ 0 $ 225 Cost of field servicing $ 1,350 $ 1,260 Supplies used in testing $ 45 $ 81 Systems development $ 720 $ 900 Warranty repairs $ 3,780 $ 1,620 Net cost of scrap $ 630 $ 1,170 Product testing $ 900 $ 1,800 Product recalls $ 3,150 $ 900 Disposal of defective products $ 810 $ 1,080 Sales have been flat over the…arrow_forwardAn automobile manufacturer plans to spend one billion dollars to improve the quality of a new model. The manufacturer expects the quality improvement program to eliminate the need for recall and reduce the costs for warranty repairs. The manufacturer’s experience has been, on average, 1.5 recalls for each new model at a cost of $300 per vehicle per recall. The average cost per recall, if one is needed, is expected to increase by 10% for the new model. Costs for other warranty repairs are expected to decrease from $200 to $80 per unit. Sales of the new model were expected to be 500,000 units without the quality-improvement program. The firm believes that the proposed, well-advertised quality program expected to cost an additional $50 million will increase total sales to 650,000 units. The gross profit per unit on the new model sold is $5,000.   Required: Would you recommend the proposed quality-improvement program? Please show all your computations to support your answer.arrow_forwardA railway promises to ship freight from Toronto to Vancouver in 9 days, but customers consider any time between 6 and 14 days to be acceptable. Last week an auditor examined a sample of 71 shipments and found their delivery time had a mean of 10.4 days and a standard deviation of 1.5 days. The auditor also found 4 shipments where the customer had been charged too much money. With respect to shipping time, calculate the potential Sigma score for the process.arrow_forward
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