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1. Who was Edward Deming and why did he become famous? 2. Define quality in your own words? 3. Italian Irons is planning to sign a contract with a Chinese manufacturer. A manager was sent to china and he took a daily sample of 150 irons during 10 days. Following is the data with the number of defectives: Sample 1 2 3 4 5 6 7 8 9 10 Defective 2 4 5 7 8 9 10 12 5 5 a) Build a 3σ control chart using the above.information (Use at least 3 decimal): b) Is the process out of control? Explain/ 4. A retail store has 3 locations in the same city. The manager wants to close one of the locations base on its productivity. Table below summarize monthly productivity information for the stores. Store 1 Store 2 Store 3 Sales [$] 1,250,000 750,000 650,000 Number of employees 25 12 10 Average Salary per employee [$] 2,000 1,800 2,200 Rent [$] 30,000 20,000 18,000 Electricity and Water 20,000 19,500 25,000 a) What facility needs to be closed based on labor productivity? b) What facility needs to be closed based on total productivity? 5. Following is information about customer service in an online trade service. More exactly, the information below describes the amount of time in minutes spent by brokers and customers on the phone. Results X-Bar Range UCL 4.828 6.694 Center Line 3.002 3.165 LCL 1.176 0 Sample size 7 Range 0 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Sample Mean X-Bar 0 1 2 3 4 5 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Sample Mean A new survey showed that customers expect to spend between 1 and 7 minutes. a. What is the current process capability index of the process? b. Interpret the result obtained in a) 6. A manufacturing company has two plants (plant A and plant B) and three stores (Store 1, Store 2, and Store 3). Plant A capacity is 80 units and Plant B capacity is 100 units. Store 1 demand is 60 units, Store 2demand is 40, units and Store 3 demand is 70 units. Following are the transportation costs between each pair of locations Store 1 Store 2 Store 3 Plan A 50 70 85 Plant B 93 88 65 a) Draw problem’s transportation network. b) Build a linear program that minimizes transportation cost. c) Provide a solution

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1. Who was Edward Deming and why did he become famous?

Edward Deming was American statistician, mathematician, professor and author who left the biggest mark on Japanese industry. He is known for raising understanding of quality in management and improving business processes by using statistical methods and providing Japanese top managers with knowledge that is probably one of the reasons their industry is perceived as the most innovative one. In Japan Deming was honored by establishment of Deming Prize and by American government awarded with National Medal of Technology in 1987. His most significant contribution to development of economic theory and practice is management method called 14 points which is based on a system that is consisted of four components: appreciation of system, understanding of variation, psychology and theory of knowledge....
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