WGU C215 OPERATIONS MANAGEMENT – COMPETENCIES
1 & 2 EXAM REVIEW 2026-2027, TQM, SIX SIGMA, QUALITY
CONTROL & CAPACITY PLANNING OPERATIONS
MANAGEMENT LATEST REVIEWED STUDY GUIDE
Competency 1: Quality Management Methods
(16%) Chapter 5: Total Quality Management
• Total Quality management (TQM) Philosophy
o TQM focuses on identifying quality problem root causes
o Encompasses the entire organization
o Involves the technical as well as people
o Relies on seven basic concepts of
▪ Customer focus
▪ Continuous improvement
▪ Employee empowerment
▪ Use of quality tools
▪ Product design
▪ Process Management
▪ Managing supplier quantity
• Quality Gurus and their contributions to TQM
o Walter A. Shewhart: Contributed to understanding of process
variability. Developed concept of statistical control charts.
o W. Edwards Deming: Stressed management’s responsibility for quality.
Developed “14 Points’ to guide companies into quality improvement
o Joseph M. Juran: Defined quality as “fitness for use” and developed
concept of cost of quality.
o Armand V. Feigenbaum: Introduced concept of total quality control.
o Philip B. Crosby: Coined phrase “quality is free” and introduced concept
of zero defects.
o Kaoru lshkawa: Developed cause and effect diagrams. Identified
concept of “internal customer.”
o Genichi Taguchi: Focused on product design quality. Developed
Taguchi loss function.
• Definitions of Quality
o Conformance to Specifications: How well a product or service meets the
targets and tolerances set by designers
o Fitness for Use: How well the product performs its intended purpose or
use.
o Value for Price Paid: Quality defined in terms of consumer’s
perception of usefulness of service or product related to prices
paid.
o Support Services: Quality defined in terms of the support provided
after the product or service is purchased
o Psychological Criteria: Way of dealing quality, focuses on the
judgmental evaluation of what constitutes product or service
excellence
• Four Costs of Quality
o Prevention and Appraisal: Costs that are incurred to prevent poor quality
, o Internal and External Failure: Costs that the company hopes to prevent
• The Organizational impact of quality
o Quality function deployment (QFD) is a tool used to translate customer
needs into specific engineering requirements. Seven problem-solving
tools are used in managing quality. Often called the seven tools of quality
control, they are cause-and-effect diagrams, flowcharts, checklists,
scatter diagrams, Pareto analysis, control charts, and histograms.
• Plan-Do-Act-Study Cycle
o -Plan-do-act-study (PDSA) cycle describes the activities a company
needs to perform in order to incorporate continuous improvement in
its operation.
o -Plan: Managers must evaluate the current process and make plans based
on any problems they find. Document all current procedures, collect data,
and identify problems.
o -Do: Implementing the plan (do). Managers should document all changes
made and collect data for evaluation.
o -Study: Managers must study the data collected in the previous phase.
The data are evaluated to see whether the plan is achieving the goals
established in the plan phase.
o -Act: Managers must act on the basis of the results. Communicate results
to other members of the company and then implement the new procedure
if it has been successful. The next step is to plan again and restart the
cycle.
•
o -Benchmarking: Another way companies implement continuous
improvement is
by studying business practices of companies considered “best in class.”
The ability to learn and study how others do things. The benchmark
company does not need to be in the same business as long as it excels at
something the company is doing and wishes to emulate. (Ex. Lands’ End
clothing catalog)
• ISO 9000 Standards
o Certification developed by International Organization for Standardization
o Set of internationally recognized quality standards
o Companies are periodically audited and certified
• ISO 14000 Standards
o Focuses on a company’s environmental responsibility
Review Chapter 6: Statistical Quality Control
• Definition of Statistical Quality Control
o The term used to describe the set of statistical tools used by quality
professionals to evaluate organizational quality
• Sources of Variation
o Can exist in all processes
o Common Causes
▪ Random causes that we cannot identify
▪ Unavoidable, (Ex. Slight differences in process variables like
diameter weight, service time, temperature)
, o Assignable Causes
▪ Causes can be identified
▪ Eliminate cause (Ex. Poor employee training, worn tool, machine
needing repair)
• Process capability
o Is evaluating the ability of a production process to meet or exceed
preset specifications.
• Process Capability Index (Cpk)
o Computed as the ratio of the specification width to the width of the
process variability
• Six Sigma
o Coined by the Motorola Corp. In the 1980’s to describe the high level of
quality the company was striving to achieve. Sigma stands for the
number of standard deviations of the process.
▪ Relies heavily on the data driven technical tools in Ch. 5
▪ To achieve the goal of Six Sigma, Motorola instituted a quality
focus in every aspect of their organization (before a product is
designed)
▪ The two aspects to implementing the six-sigma concept are:
• Technical tools and people involvement
▪ Employees are given martial arts titles that reflect their skills in
the Six Sigma process. Black belts and master black belts are
individuals who have extensive training in the use of technical
tools and are responsible for carrying out the implementation of
Six Sigma.
▪ They act as coaches, team leaders, and facilitators of the
process of continuous improvement.
▪ The person that comes front the top ranks of the organization and
is responsible for providing direction and overseeing aspects of a
six-sigma
implementation process is called champion
o Five-Step Plan
▪ 1. Define the quality problem of the process
▪ 2. Measure the current performance of the process
▪ 3. Analyze the process to identify the root cause of the quality
problem
▪ 4. Improve the process by eliminating the root causes of the
problem
▪ 5. Control the process to ensure the improvements continue.
• Acceptance Sampling
o Defined: The third branch of SQC refers to the process of randomly
inspecting a certain number of items from a lot or batch in order to decide
whether to accept or reject the entire batch.
o Different from SPC because acceptance sampling is performed either
before or after the process rather than just during
▪ Sampling before typically is done to supplier material
▪ Sampling after involves sampling finished items before
shipment or finished components prior to assembly
1 & 2 EXAM REVIEW 2026-2027, TQM, SIX SIGMA, QUALITY
CONTROL & CAPACITY PLANNING OPERATIONS
MANAGEMENT LATEST REVIEWED STUDY GUIDE
Competency 1: Quality Management Methods
(16%) Chapter 5: Total Quality Management
• Total Quality management (TQM) Philosophy
o TQM focuses on identifying quality problem root causes
o Encompasses the entire organization
o Involves the technical as well as people
o Relies on seven basic concepts of
▪ Customer focus
▪ Continuous improvement
▪ Employee empowerment
▪ Use of quality tools
▪ Product design
▪ Process Management
▪ Managing supplier quantity
• Quality Gurus and their contributions to TQM
o Walter A. Shewhart: Contributed to understanding of process
variability. Developed concept of statistical control charts.
o W. Edwards Deming: Stressed management’s responsibility for quality.
Developed “14 Points’ to guide companies into quality improvement
o Joseph M. Juran: Defined quality as “fitness for use” and developed
concept of cost of quality.
o Armand V. Feigenbaum: Introduced concept of total quality control.
o Philip B. Crosby: Coined phrase “quality is free” and introduced concept
of zero defects.
o Kaoru lshkawa: Developed cause and effect diagrams. Identified
concept of “internal customer.”
o Genichi Taguchi: Focused on product design quality. Developed
Taguchi loss function.
• Definitions of Quality
o Conformance to Specifications: How well a product or service meets the
targets and tolerances set by designers
o Fitness for Use: How well the product performs its intended purpose or
use.
o Value for Price Paid: Quality defined in terms of consumer’s
perception of usefulness of service or product related to prices
paid.
o Support Services: Quality defined in terms of the support provided
after the product or service is purchased
o Psychological Criteria: Way of dealing quality, focuses on the
judgmental evaluation of what constitutes product or service
excellence
• Four Costs of Quality
o Prevention and Appraisal: Costs that are incurred to prevent poor quality
, o Internal and External Failure: Costs that the company hopes to prevent
• The Organizational impact of quality
o Quality function deployment (QFD) is a tool used to translate customer
needs into specific engineering requirements. Seven problem-solving
tools are used in managing quality. Often called the seven tools of quality
control, they are cause-and-effect diagrams, flowcharts, checklists,
scatter diagrams, Pareto analysis, control charts, and histograms.
• Plan-Do-Act-Study Cycle
o -Plan-do-act-study (PDSA) cycle describes the activities a company
needs to perform in order to incorporate continuous improvement in
its operation.
o -Plan: Managers must evaluate the current process and make plans based
on any problems they find. Document all current procedures, collect data,
and identify problems.
o -Do: Implementing the plan (do). Managers should document all changes
made and collect data for evaluation.
o -Study: Managers must study the data collected in the previous phase.
The data are evaluated to see whether the plan is achieving the goals
established in the plan phase.
o -Act: Managers must act on the basis of the results. Communicate results
to other members of the company and then implement the new procedure
if it has been successful. The next step is to plan again and restart the
cycle.
•
o -Benchmarking: Another way companies implement continuous
improvement is
by studying business practices of companies considered “best in class.”
The ability to learn and study how others do things. The benchmark
company does not need to be in the same business as long as it excels at
something the company is doing and wishes to emulate. (Ex. Lands’ End
clothing catalog)
• ISO 9000 Standards
o Certification developed by International Organization for Standardization
o Set of internationally recognized quality standards
o Companies are periodically audited and certified
• ISO 14000 Standards
o Focuses on a company’s environmental responsibility
Review Chapter 6: Statistical Quality Control
• Definition of Statistical Quality Control
o The term used to describe the set of statistical tools used by quality
professionals to evaluate organizational quality
• Sources of Variation
o Can exist in all processes
o Common Causes
▪ Random causes that we cannot identify
▪ Unavoidable, (Ex. Slight differences in process variables like
diameter weight, service time, temperature)
, o Assignable Causes
▪ Causes can be identified
▪ Eliminate cause (Ex. Poor employee training, worn tool, machine
needing repair)
• Process capability
o Is evaluating the ability of a production process to meet or exceed
preset specifications.
• Process Capability Index (Cpk)
o Computed as the ratio of the specification width to the width of the
process variability
• Six Sigma
o Coined by the Motorola Corp. In the 1980’s to describe the high level of
quality the company was striving to achieve. Sigma stands for the
number of standard deviations of the process.
▪ Relies heavily on the data driven technical tools in Ch. 5
▪ To achieve the goal of Six Sigma, Motorola instituted a quality
focus in every aspect of their organization (before a product is
designed)
▪ The two aspects to implementing the six-sigma concept are:
• Technical tools and people involvement
▪ Employees are given martial arts titles that reflect their skills in
the Six Sigma process. Black belts and master black belts are
individuals who have extensive training in the use of technical
tools and are responsible for carrying out the implementation of
Six Sigma.
▪ They act as coaches, team leaders, and facilitators of the
process of continuous improvement.
▪ The person that comes front the top ranks of the organization and
is responsible for providing direction and overseeing aspects of a
six-sigma
implementation process is called champion
o Five-Step Plan
▪ 1. Define the quality problem of the process
▪ 2. Measure the current performance of the process
▪ 3. Analyze the process to identify the root cause of the quality
problem
▪ 4. Improve the process by eliminating the root causes of the
problem
▪ 5. Control the process to ensure the improvements continue.
• Acceptance Sampling
o Defined: The third branch of SQC refers to the process of randomly
inspecting a certain number of items from a lot or batch in order to decide
whether to accept or reject the entire batch.
o Different from SPC because acceptance sampling is performed either
before or after the process rather than just during
▪ Sampling before typically is done to supplier material
▪ Sampling after involves sampling finished items before
shipment or finished components prior to assembly
