Quality Function Deployment was developed by Yoji Akao in Japan in 1966. By 1972 the power of the approach had been well demonstrated at the Mitsubishi Heavy Industries Kobe Shipyard and in 1978 the first book on the subject was published in Japanese and then later translated into English in 1994. 
The QFD methodology can be used for both tangible products and non-tangible services, including manufactured goods, service industry, software products, IT projects, business process development, government, healthcare, environmental initiatives, and many other applications.
What is Quality Function Deployment QFD
Quality function deployment (QFD) is a “method to transform user demands into design quality, to deploy the functions forming quality, and to deploy methods for achieving the design quality into subsystems and component parts, and ultimately to specific elements of the manufacturing process.” as described by Dr. Yoji Akao, who originally developed QFD
Moreover, Quality Function Deployment is a systematic approach to design based on a close awareness of customer desires, coupled with the integration of corporate functional groups. It consists in translating customer desires (for example, the ease of writing for a pen) into design characteristics (pen ink viscosity, pressure on ball-point) for each stage of the product development.  
There are 3 main goals in implementing QFD :
- Prioritize spoken and unspoken customer wants and needs.
- Translate these needs into technical characteristics and specifications.
- Build and deliver a quality product or service by focusing everybody toward customer
Usage of QFD
Since its introduction, Quality Function Deployment has helped to transform the way many companies:
- Plan new products
- Design product requirements
- Determine process characteristics
- Control the manufacturing process
- Document already existing product specifications
- Reduce time to market
- Reduce product development time by 50%
The Quality Function Deployment Process
- Identify the Customers
- Determine Customer Requirements/Constraints
- Prioritize each requirement
- Competitive Benchmarking
- Translate Customer Requirements into Measurable Engineering specifications
- Set Target values for each Engineering Specification
QFD uses some principles from Concurrent Engineering in that cross-functional teams are involved in all phases of product development. Each of the four phases in a QFD process uses a matrix to translate customer requirements from initial planning stages through production control.
Each phase, or matrix, represents a specific aspect of the product’s requirements. Relationships between elements are evaluated for each phase. Only the most important aspects of each phase are deployed into the next matrix .
- Phase 1, Product Planning: mainly it is building the House of Quality. Initiated by the marketing Phase 1 is also called The House of Quality. Many organizations only get through this phase of a QFD process. Phase 1 documents customer requirements, warranty data, competitive opportunities, product measurements, competing for product measures, and the technical ability of the organization to meet each customer requirement. Getting good data from the customer in Phase 1 is critical to the success of the entire QFD process.
- Phase 2, Product Design: This phase 2 is initiated by the engineering department. Product design requires creativity and innovative team ideas. Product concepts (goals and objectives) are created during this phase and part specifications are documented. Parts that are determined to be most important to meeting customer needs are then deployed into process planning, or the next Phase 3.
- Phase 3, Process Planning: Process planning comes next and is owned by manufacturing engineering. During process planning, manufacturing processes are flowcharts and process parameters (or target values) are documented.
- Phase 4, Process Control: And finally, in production planning, performance indicators are created to monitor the production process, maintenance schedules, and skills training for operators. Also, in this phase decisions are made as to which process poses the most risk and controls are put in place to prevent The quality assurance department in concert with manufacturing leads Phase 4.
Figure illustrates QFD phases
The House of Quality
House of Quality is a diagram , resembling a house, used for defining the relationship between customer desires and the firm/product capabilities. It is a part of the Quality Function Deployment (QFD) and it utilizes a planning matrix to relate what the customer wants to how a firm (that produces the products) is going to meet those wants.
House of Quality appeared in 1972 in the design of an oil tanker by Mitsubishi Heavy Industries. Akao has reiterated numerous times that a House of Quality is not QFD, it is just an example of one tool.
Figure illustrates house of quality matrix
Invented by Stuart Pugh the decision-matrix method , also Pugh method, Pugh Concept Selection is a quantitative technique used to rank the multi-dimensional options of an option set. It is frequently used in engineering for making design decisions but can also be used to rank investment options, vendor options, product options or any other set of multidimensional entities.
Figure illustrates Decision matrix
Modular Function Deployment
Modular Function Deployment uses QFD to establish customer requirements and to identify important design requirements with a special emphasis on modularity.
Example of QFD using house of quality
This particular QFD example was created for an imaginary Chocolate Chip Cookie Manufacturer (a.k.a. a “Bakery”). The example maps customer requirements to parts/materials to be purchased in order to meet and/or exceed the customer expectations. (The prioritization comes into play when assuming the limited availability of funds for making purchases.) 
The example can be accessible using URL: http://www.qfdonline.com/qfd-tutorials/house-of-quality-qfd-example/
Findings of the example:
- The QFD ends with HOQ #3. This is due primarily to the fact that all of its parts/materials are purchased rather than manufactured. Had a different product been chosen, a 4th HOQ could have been added that mapped parts/materials attribute to processes and/or initiatives for manufacturing the parts that met those specifications.
- The “Weight” requirement (column #4) in HOQ #1 may not be a valuable requirement. You can tell that this requirement is suspect by the fact that its “Max Relationship Value in Column” is only 1. (Note: the template auto-highlights warning values).
- The “Weight” requirement (row #4) in HOQ #2 is not being addressed. Similarly, “Tensile Ultimate Strength” (Row #3) and “Size (diameter)” (Row #5) are not being substantially addressed. (Note their “Max Relationship Value in Row” values).
- HOQ #3 has examples of both of the issues listed in #1 & 2 above.
 Sullivan, 1986.
 Mizuno and Akao, 1994.
 I. R. Institute, “Quality Function Deployment,” Creative Industries Research Institute.
 Wikipedia, “Quality function deployment,” Wikipedia, [Online]. Available: http://en.wikipedia.org/wiki/Quality_function_deployment. [Accessed 7 1 2012].
 Wikipedia, “House of Quality,” Wikipedia, [Online]. Available: http://en.wikipedia.org/wiki/House_of_Quality. [Accessed 1 7 2012].
 Wikipedia, “Decision matrix method,” Wikipedia, [Online]. Available: http://en.wikipedia.org/wiki/Decision-matrix_method. [Accessed 1 7 2012].
 Wikipedia, “Modular Function Deployment,” Wikipedia, [Online]. Available: http://en.wikipedia.org/wiki/Modular_Function_Deployment. [Accessed 1 7 2012].
 Q. Online, “House of Quality (QFD) Example,” QFD Online, [Online]. Available: http://www.qfdonline.com/qfd-tutorials/house-of-quality-qfd-example/. [Accessed 4 7 2012].