Manufacturing is a complex system. It can be viewed from many different perspectives and this in turn leads to different approaches to study different aspects of manufacturing. Manufacturing can be viewed from firm, national, regional or global perspectives. At the firm level, manufacturing can be characterised as a three level system - process, operation and strategic levels. Each level consists of several different elements, all of which are integrated. Also, manufacturing involves several different aspects - ranging from technology to commercial to management.
In the context of manufacturing, the word "quality" conveys several different concepts and notions. In the narrow sense, quality in manufacturing refers to the quality of materials, products and processes. In the broad sense, quality in manufacturing includes many other notions such as quality of service, quality of operations, and quality of management. Quality is important in the context of the highly global and competitive markets. Businesses need to continuously improve their quality in order to survive in such an environment.
In this thesis we focus our attention on product quality. Many different notions of product quality have been proposed in the literature. Most of these relate to the final end product of the manufacturing process sold to customers. However, manufacturing of a product involves several stages and these are best characterised through the concept of the Product Life Cycle (PLC). As a result, there are several other notions of product quality for the earlier stages of the product life cycle. Product quality improvement needs a framework which links these different notions and takes into account the interactions between these notions and with other variables of the manufacturing system. The systems approach provides such a framework and the two key elements of the approach are (i) the system characterisation needed to build mathematical models and, (ii) the use of mathematical models for decision making with regards quality improvement.
The thesis starts with a detailed look at the different notions of product quality and linking them using the product life cycle concept. In the process, some new notions of product quality are defined. Following this we look at the system characterisation for product quality improvement and illustrate it through two examples. The first deals with improvement to quality of performance and driven by technology, commercial or top management. The second deals with improvement to quality of conformance and is market driven. We look at three different options for improvement.
We then focus on a particular notion, namely product reliability. We look at three different scenarios and use the system approach to derive the optimal improvement strategies. The details of the model formulation are given along with the analysis to obtain the optimal improvement actions. We first look at the implications of poor product reliability from both buyer and manufacturer perspectives. This sets the background for making decisions with regard product reliability improvement. We look at three different cases. The first case deals with reducing the failure intensity function in the early part of the product life. The objective in this case is to reduce customer dissatisfaction and warranty servicing costs and this is achieved through improved quality control. The second case deals with reducing the failure rate over the useful life of the product. This is important for the following two reasons. First, it results in lower maintenance costs to the buyer and this has an impact of customer retention. Second, the manufacturer can offer extended warranty at a lower price and also use it as a promotional tool to market as longer warranty conveys the signal of high product reliability. The third case deals with improving product durability so that the product has a longer useful lifetime.
We then change our focus to the effect of product quality on the marketing of a new product. The three different notions of product quality that affect sales are (i) claimed quality, (ii) actual quality, and (iii) perceived quality. The customers learn about product reliability through usage and as a result the perceived quality changes dynamically. The gap between perceived quality and claimed quality can have either a positive or negative impact on the sales. We propose a simple model, which captures this effect, and carry out a qualitative analysis of the model.
We conclude with a brief discussion of topics for future research.