TOTAL QUALITY MANAGEMENT:TQM

Origins, Evolution & key elements

21 st . century winners

Total quality - focused. Information technology based. Vision directed. Flatter and empowered. Customer driven. Flexible and adaptive. Time based. Innovative. Global. Networked.

CURRENT DEMANDS FROM ORGANISATIONS

• TO UNDERSTAND WHAT CUSTOMER WANTS AND TO PROVIDE IT , IMMEDIATELY ON DEMAND , AT LOWEST COST

• TO PROVIDE PRODUCTS & SERVICES OF HIGH QUALITY AND RELIABILITY CONSISTENT

• TO KEEP UP WITH PACE OF CHANGE , TECHNOLOGICAL AS WELL AS POLITICAL AND SOCIAL

• TO BE ONE STEP AHEAD OF THE CUSTOMER’S NEEDS ; THAT IS , TO PREDICT WHAT THE CUSTOMER WILL WANT ONE YEAR OR TEN YEARS FROM NOW

CUSTOMER MEANS INTERNAL CUSTOMER AS WELL

TQM

• Total – made up of the whole

• Quality – Degree of excellence a product or service provides

• Management – Act, art, or manner of handling, controlling, directing etc.

TQM is the art of managing the whole to achieve excellence.

QUALITY MANAGEMENT TRIANGLE

COMMITMENTTO NEVER-ENDING QUALITY IMPROVEMENT

INVOLVEMENT SCIENTIFICKNOWLEDGE

What is Quality?

Quality is “fitness for use”

(Joseph Juran)

Quality is “conformance to requirements”

(Philip B. Crosby)

Quality of a product or services is its ability to satisfy the needs and expectations of the customer

““The quality of a product or service is a The quality of a product or service is a customer’s perception of the degree to which the customer’s perception of the degree to which the product or service meets customer’sproduct or service meets customer’s expectations.”expectations.”

Meaning of Quality

• Webster’s Dictionary– degree of excellence of a thing

• American Society for Quality– totality of features and characteristics that

satisfy needs

WHAT IS QUALITY ?

EVERYTHING WHICH MATTERS TO THE CUSTOMER

WHAT IS POTENTIAL OF AN ORGANISATION ? ( INCLUDING THE EFFECT OF SYNERGY )

WHAT IS PRESENT LEVEL OF PERFORMANCE ?

QUALITY MANAGEMENT ATTEMPTS TO FILL THIS GAP

Nature of Quality

• Dimensions of Quality

• Determinants of Quality

• Costs of Quality

Best-In-Class and World-Class

• Customers’ expectations of quality are not the same for different classes of products or services.

• Best-in-class quality means being the best product or service in a particular class of products or services.

• Being a world-class company means that each of its products and services are considered best-in-class by its customers.

Some Dimensions of Product Quality• Performance – relative to customer’s intended

use• Features – special characteristics• Reliability – likelihood of breakdowns,

malfunctions• Serviceability – speed/cost/convenience of

servicing• Durability – amount of time/use before repairs• Appearance – effects on human senses• Customer service – treatment before/during/after

sale• Safety – user protection before/during/after use

Traditionally Quality has 3 main dimensions

• Performance• Price• Promptness

In present context , following more dimensions should be added to Concern for Quality –

• Global competitiveness• Concern for environment• Concern for safety

Determinants of Quality

• Quality of design – products/service designed based on customers’ expectations and desires

• Quality capability of production processes – processes must be capable of producing the products designed for the customers

• Quality of conformance – capable processes can produce inferior product if not operated properly

• Quality of customer service – a superior product does not mean success; must have quality service also

• Organization quality culture – superior product and service requires organization-wide focus on quality

Costs of Quality

• Scrap and rework - rescheduling, repairing, retesting

• Defective products in the hands of the customer - recalls, warranty claims, law suits, lost business, …

• Detecting defects - inspection, testing, ….• Preventing defects - training, charting

performance, product/process redesign, supplier development, ….

Traditional Quality Management

• Rigorous system of inspection

• Defective products will be identified and discarded

• Quality can be inspected into products

• Main decision is how many products to inspect (largely a question of economics)

Meaning of Quality:Consumer’s Perspective

• Fitness for use– how well product or

service does what it is supposed to

• Quality of design– designing quality

characteristics into a product or service

• A Mercedes and a Ford are equally “fit for use,” but with different design dimensions

Quality management

• Have three main components:• quality control• quality assurance• quality improvement.• Quality management is focused not only on

product/service quality, but also the means to achieve it. Quality management therefore uses quality assurance and control of processes as well as products to achieve more consistent quality.

Evolution of Quality Management

Inspection

Quality Control

Quality Assurance

TQM

Salvage, sorting, grading, blending, corrective actions, identify sources of non-conformance

Develop quality manual, process performance data, self-inspection, product testing, basic quality planning, use of basic statistics, paperwork control.

Quality systems development, advanced quality planning, comprehensive quality manuals, use of quality costs, involvement of non-production operations, failure mode and effects analysis, SPC.

Policy deployment, involve supplier & customers, involve all operations, process management, performance measurement, teamwork, employee involvement.

Inspection

• Does not add value• Inspectors distrusted by workers• Increase quality and reduce need for

inspectors• Poka-yoke - “mistake proof”• Have workers do own inspecting

– Before – are inputs good?– During – process happening properly?– After – conforms to standards?

W. E. Deming and the 6 Era’s of Quality

1920’s : New statistical thinking and methods in manufacturing1930/40’s : Use of statistical thinking outside

manufacturing 1950/60’s : Systems of improvement1970/80’s : The fourteen pointsLate 80’s : The “New Climate”1990’s : System of Profound Knowledge

W. Edwards Deming

• Statistics professor, specializing in acceptance sampling

• Assisted Japan in improving productivity and quality after World War II

Introduced Japanese companies to the Plan-Do-Check-Act (PDCA) cycle (developed by Shewart)

System (not employees) is cause of poor quality

Developed 14 Points for managers

Deming’s Paradigms

1. Intrinsic & extrinsic motivation

2. Management needs to improve and innovate processes to create results

3. Optimize the system toward its aim

4. Cooperation is better than competition

Deming’s view of a production as a system

Consumer Research

Design & redesign

Receipt & test of materials

Suppliers, materials & equipment

Production, assembly, inspection

Distribution Consumers

Test of processes, machines, methods, cost

Improve Quality

Productivity improves

Provide jobs and more jobs

Deming’s Chain Reaction

Cost decreases because of less rework, fewer mistakes, fewer delays, snags, better use of machine time and materials

Stay in business

Capture the market with better quality and lower price

PLAN

CHECK

DOACT

The Deming Cycle or PDCA Cycle

Plan a change to the process. Predict the effect this change will have and plan how the effects will be measured

Implement the change on a small scale and measure the effects

Adopt the change as a permanent modification to the process, or abandon it.

Study the results to learn what effect the change had, if any.

W. Edwards Deming’s 14 Points

Create constancy of purpose towards improvement of product and services.

Adopt the new philosophy. We can no longer live with commonly accepted levels of delays, mistakes, defective workmanship.

Cease dependence on mass inspection. Require, instead, statistical evidence that quality is built in.

End the practice of awarding business on the basis of price tag.

1)

2)

3)

4)

W. Edwards Deming’s 14 Points

Find problems. It is management’s job to work continually on the system.

Institute modern methods of training on the job.

Institute modern methods of supervision of production workers. The responsibility of foremen must be changed from numbers to quality.

Drive out fear that everyone may work effectively for the company.

5)

6)

7)

8)

Break down barriers between departments.

Eliminate numerical goals, posters and slogans for the workforce asking for new levels of productivity without providing methods.

Eliminate work standards that prescribe numerical quotas.

Remove barriers that stand between the hourly worker and his right to pride of workmanship.

9)

10)

11)

12)

W. Edwards Deming’s 14 Points

Institute a vigorous programme of education and retraining.

Create a structure in top management that will push everyday on the above 13 points.

13)

14)

W. Edwards Deming’s 14 Points

Deming’s System of Profound Knowledge

Appreciation for system

Knowledge about variation

Theory about knowledge

Knowledge of psychology

Joseph Juran

• Went to Japan in 1951

• Wrote Quality Control Handbook

• Quality begins by knowing what customers want

• 80% of defects are controllable– Quality Planning– Quality control– Quality improvement

Philip B. Crosby• Martin Marietta, ITT, starting in 1960s• Wrote “Quality is Free” in 1979• Management must be firmly behind any quality

plans • Do it right the first time • Company should have the goal of zero defects

– Cost of poor quality is greatly underestimated

– Traditional trade-off between costs of improving quality and costs of poor quality is erroneous

Quality GurusQuality Gurus

• Armand V. Feigenbaum– Developed concept of total quality control

(TQC)– Responsibility for quality must rest with the

persons who do the work (quality at the source)

• Kaoru Ishikawa– Wrote Guide to Quality Control in 1972– Credited with the concept of quality circles– Suggested the use of fishbone diagrams

Quality Gurus

• Genichi Taguchi– Contends that constant adjustment of

processes to achieve product quality is not effective

– Instead, products should be designed to be robust enough to handle process and field variation

Quality Drives the Productivity Machine

• If production does it right the first time and produces products and services that are defect-free, waste is eliminated and costs are reduced.

• Estimated that 20-25% of COGS in the US is spent on finding and correcting errors

• Quality management programs today are viewed by many companies as productivity improvement programs.

Dimensions of Quality:Manufactured Products

• Performance – basic operating characteristics of a product; how well

a car is handled or its mileage

• Features – “extra” items added to basic features, such as a

stereo CD or a leather interior in a car

• Reliability– probability that a product will operate properly within

an expected time frame; that is, a TV will work without repair for about seven years

Dimensions of Quality:Manufactured Products (cont.)

• Conformance – degree to which a product meets pre–

established standards

• Durability– how long product lasts before replacement

• Serviceability– ease of getting repairs, speed of repairs,

courtesy and competence of repair person

Dimensions of Quality:Manufactured Products (cont.)

• Aesthetics– how a product looks, feels, sounds, smells, or

tastes

• Safety – assurance that customer will not suffer injury

or harm from a product; an especially important consideration for automobiles

• Perceptions– subjective perceptions based on brand name,

advertising, and the like

Dimensions of Quality:Service

• Time and Timeliness– How long must a customer wait for service,

and is it completed on time?– Is an overnight package delivered overnight?

• Completeness:– Is everything customer asked for provided?– Is a mail order from a catalogue company

complete when delivered?

Dimensions of Quality:Service (cont.)

• Courtesy:– How are customers treated by employees?– Are catalogue phone operators nice and are

their voices pleasant?

• Consistency– Is the same level of service provided to each

customer each time?– Is your newspaper delivered on time every

morning?

Dimensions of Quality:Service (cont.)

• Accessibility and convenience– How easy is it to obtain service?– Does a service representative answer you calls quickly?

• Accuracy– Is the service performed right every time?– Is your bank or credit card statement correct every month?

• Responsiveness– How well does the company react to unusual situations?– How well is a telephone operator able to respond to a

customer’s questions?

Meaning of Quality:Producer’s Perspective

• Quality of Conformance– Making sure a product or service is produced

according to design• if new tires do not conform to specifications, they

wobble• if a hotel room is not clean when a guest checks in,

the hotel is not functioning according to specifications of its design

Meaning of Quality:A Final Perspective

• Consumer’s and producer’s perspectives depend on each other

• Consumer’s perspective: PRICE

• Producer’s perspective: COST

• Consumer’s view must dominate

Fitness forConsumer Use

Fitness forConsumer Use

Producer’s PerspectiveProducer’s Perspective Consumer’s PerspectiveConsumer’s Perspective

Quality of ConformanceQuality of Conformance

• Conformance to specifications

• Cost

Quality of DesignQuality of Design

• Quality characteristics• Price

MarketingMarketingProductionProduction

Meaning of Quality Meaning of Quality

Meaning of Quality