Tqm

04/10/2023 Sourabh Jain 1

By Sourabh JainMBA 2010 - 2012

National Institute of Technology Karnataka, Surathkal, India


Preface

• This is a PowerPoint file I created in order to help me in my studies.

• The material in these slides are a distilled version of the literature from 2 books

1. Total Quality Management – 3rd Edition – Besterfield, Michna, Besterfield, Sacre.

2. Total Quality Management – Bharat Wakhlu


HOME

Introduction Leadership

Customer Satisfaction

Employee Involvement

Continuous Process Improvement

Performance Measures

QMS SPC


Introduction


Quality

• Degree to which a set of inherent characteristics fulfils requirements.

• Q=Performance/Expectations

• TQM; T = Total i.e. company-wide, suppliers, customers; M = Management i.e. art of directing and controlling


Quality q and Total Quality Q

• Product orientation• Ensure produced goods are fit for sale• No prevention, No learning


Quality q and Total Quality Q

• Customer/Process/Product orientation• Listen to customer, product design, process

optimized• Right the first time, every time; Learning; importance

of internal customers


Dimensions of QualityDimension Meaning

Performance Primary product characteristics

Features Added features

Conformance Meeting standards

Reliability Consistency of performance

Durability Useful life

Service Resolution of complaints

Response Human to human interface

Aesthetics Sensory characteristics

Reputation Past performance


Total Quality

1. Performance Superiority

2. Delight customers

3. Provide value (value=quality/cost)

4. Doing the right things

5. Right the first time


Definition of TQM

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

• TQM is a philosophy and a set of guiding principles that represent the foundation of a continually improving firm.

• It is the application of quantitative methods and HR to improve all processes within a firm and exceed customer needs now and in the future.


6 basic concepts of TQM

1. Committed and involved management to provide long term- top to bottom – organizational support

2. Unwavering focus on the customer – internal and external

3. Effective involvement and utilization of entire workforce

4. Continuous improvement of business and production process

5. Treat suppliers as partners

6. Establish performance measures for processes


Culture changes for TQMQuality element OLD CULTURE TQM CULTURE

Definition Product oriented Customer oriented

Priorities Second to service and cost Equal to service and cost

Decisions Short term Long term

Emphasis Detection Prevention

Errors Operations System

Responsibility Quality Control Everyone

Problem Solving Managers Teams

Procurement Price Life cycle costs, Partnership

Manager’s Role Plan, assign, control, enforce

Delegate, coach, facilitate,mentor


Model for TQM

Outstanding Leadership

Product, Services

and Process

Systems and

Procedures

People power

CONTINUOUS SYSTEMATIC

IMPROVEMENT

BENCHMARKING CUSTOMER FOCUS

MEETING/EXCEEDING CUSTOMER

EXPECTATIONS


Paradigms of TQM

• Belief that people are a potential source of ‘beneficial forces’ will lead to total quality

• Functional and Hierarchical divisions of a firm contribute to parochial thinking – not good

• Everyone has to participate in obtaining total quality


Gurus of TQM

• Shewhart1. Economic Control of Quality of Mfg product2. Control Chart Theory3. Assignable and chance causes of variation4. Rational Subgroups5. PDSA cycle


Gurus of TQM

• Deming1. Out of the Crisis2. Quality, Productivity and Competitive

Position3. 14 points to improve q,p,c4. Taught SPC and quality to Japanese


Gurus of TQM

• Juran1. Juran’s Quality control Handbook2. Project Improvements based on ROI3. Promoted commitment to quality at all levels4. Juran Trilogy – Planning, Control,

Improvement


Gurus of TQM

• Feigenbaum1. Total Quality Control2. Customer Satisfaction3. Genuine Management Involvement4. Employee Involvement5. Company wide total quality control6. First line supervision leadership


Gurus of TQM

• Ishikawa1. SPC texts in Japanese and English2. Adapted TQC i.e. TQM in Japan3. Fishbone diagram4. Quality circles


Gurus of TQM

• Crosby1. Quality is Free2. Quality without tears3. Do it right the first time4. Zero defects


Gurus of TQM

• Taguchi1. Loss Function2. Quality Engineering3. Robust design of parameters/tolerances


Obstacles to TQM1. Lack of management commitment2. Inability to change organization culture3. Improper planning4. Lack of continuous training and education5. Incompatible Org structure & isolated

departments and individuals6. Ineffective measurement techniques 7. Paying inadequate attention to customers8. Inadequate use of empowerment and teamwork9. Failure to continually improve


Benefits of TQM

• Improve quality• Employee participation and satisfaction• Teamwork and Working relationships• Customer satisfaction• Productivity• Communication• Profitability and Market Share


Leadership


Leader

• A leader1. Shapes2. Promotes3. Protects4. Exemplifies • the organization’s values


Manager vs. LeaderManager Leadership for quality (Outstanding leadership)

Plan EXPOSE limited utility of current approaches

Organize ENVISION the future

Staff ENLIST others in the quest

Lead EMPOWER them to act

Control ENCOURAGE right effort

Feedback EXEMPLIFY by personal action


Leadership Style

FEARFUL

STYLE

RIGID STYLE

WHOLESOME STYLE

Leads to time bomb situations Best style


Characteristics of Quality Leaders

1. Priority attention to internal/external customers

2. Empower, rather than control subordinates

3. Emphasize improvement, rather than maintenance

4. Emphasize prevention

5. Encourage collaboration rather than competition

6. Train and coach, rather than direct and supervise


Characteristics of Quality Leaders

7. Learn from problems

8. Continually try to improve communications

9. Continually demonstrate their commitment to quality

10. Choose suppliers on basis of quality, not price

11. Establish organizational systems to support quality effort

12. Encourage and Recognize team effort


7 habits of highly effective people1. Be proactive - don’t let fate control you, you control it

2. Begin with the end in mind – have a vision and plan

3. Put first things first – learn to prioritize

4. Think win-win – seek mutual benefits

5. Seek first to understand, then be understood

6. Synergy – teams are better than individuals

7. Sharpen the saw – renew one’s physical, spiritual, mental and emotional dimension


Deming Philosophy• Create and publish aims/purpose of firm

• Learn the new philosophy

• Understand purpose of inspection

• Stop awarding business on price alone

• Improve constantly and forever the system

• Institute training

• Teach and institute leadership


Deming Philosophy• Drive out fear, create trust and a climate for innovation

• Optimize efforts of teams, groups and staff areas

• Eliminate exhortations for the work force

• Eliminate numerical quotas for workforce and MBO

• Remove barriers that rob people of pride of workmanship

• Encourage education and self-empowerment for everyone

• Take action to accomplish the transformation


Company Offer

Customer Satisfaction Model

Customer Needs

Satisfier


Notes

• Customer – Internal and External is the focus.

• Customer Satisfaction is subjective, hence hard to measure

• Customer Satisfaction should not be viewed in a vacuum


Customer feedback

1. To discover customer dissatisfaction

2. Discover relative priorities of Quality

3. Compare performance with competition

4. Identify customer’s needs

5. Determine opportunities for improvement


Modes of feedback1. Comment card – Service industry

2. Customer Questionnaire – mail, telephone

3. Focus groups – like a GD

4. Toll free telephone numbers – complaints

5. Customer visits – B2B

6. Report card – send to customer every quarter

7. The internet – blogs

8. Employee feedback – why problem?

9. Mass customization – variety at affordable cost


Customer Complaints

Complain to Management2%

Shout at Front Line Employees

19%

Do nothing80%

Action

Every complaint should be accepted, analyzed and acted upon because those who don’t complain might have switched loyalty.


Handling complaints

• Accept feedback

• Empower front-line employees to resolve

• More inspection does not solve it; find the root cause

• Communicate complaint to everyone in firm

• Contact complainant and put mind at ease

• Be proactive about customer needs


Employee Involvement


Motivation

• Maslow’s Hierarchy of needs• Herzberg’s 2-factor theory

• What employees want 1. Interesting Work2. Appreciation3. Involvement4. Job Security


Achieving a motivated work force1. Know thyself

2. Know your employees

3. Establish a +ve attitude

4. Share goals

5. Monitor progress

6. Develop interesting work

7. Communicate effectively

8. Celebrate success


Employee Surveys1. Quality Council creates Survey team

2. Develop instrument (questionnaire).Constructs to be used are 1. Personality Characteristics2. Management Styles3. Job attitudes4. The work

3. Administer survey (confidential and by 3rd party)

4. Compile and analyze (report is circulated in firm)

5. Determine areas for improvement


Suggestion Systems

• Management must make it easy for employees to suggest improvements

1. Be progressive – regularly ask employees

2. Remove fear – focus on the process, not the person

3. Simplify the process

4. Respond quickly - accept/Reject/Refer giving time or reason

5. Reward the idea


Performance Appraisal

• Purpose1. Tells employee how they are performing2. Basis for promotions and increments3. Counseling4. Opportunities

• Employee involvement is critical and appraisals must be continuous.

• Types – Ranking, Narrative, Forced, Graphic


Problems with appraisal systems

1. Emphasis on short term performance

2. Individual appraisals destroy teamwork

3. A person is only about 15 % responsible for his results

4. Based on subjectivity and immeasurables


Improving the appraisal system1. Use rating scales with fewer rating categories

2. Equal emphasis to individual and group appraisals

3. More frequent performance reviews with focus on improvement

4. Promotion decision to be based on current performance AND potential for new post

5. External customer satisfaction a part of the process

6. 360 degree appraisals

7. Evaluation for process improvements


Benefits of employee involvement• Employees1. Make better decisions using expert knowledge of

process

2. More likely to implement and support decisions they had a part in making/better able to accept changes

3. Better able to spot pinpoint areas for improvement

4. Better able to take immediate corrective action

5. EI increases morale, improves industrial relations and increases commitment to unit goals


Continuous Process Improvement


Juran Trilogy – Plan, Control, Improve

• Planning1. Determine external and internal customers

2. Identify their needs and translate into requirements

3. Develop product/service as per needs of not only customer but other stakeholders too

4. Develop processes able to produce product/service

5. Transfer plans to operations ensuring process validity



• Control1. Determine items to be controlled and their units of measure

2. Set goals for controls and determine what sensors are needed

3. Measure actual performance

4. Compare it with goals

5. Act on the difference



• Improvement• Quality council identifies improvement areas and establishes project

teams to work on it

0 1 2 3 4 5 6 7 8 9 100

10

20

30

40

50

Quality Control (during operations)

Cost of poor Quality

Time

Quality Improvement

Original Zone of Quality Control

New Zone of Quality ControlChronic Waste

Sporadic Waste

QUALITY PLANNING

FEEDBACK

FEED

BACK


PDSA Cycle

Plan

Do

Study

Act


Problem Solving method1 Identify

Opportunity

2 Analyze Process

3 Develop Optimal

Solution (s)

4 Implement

5 Study the results

6 Standardize

solution

7 Plan for Future


1 Identify Opportunity

• Identify problem – Pareto analysis, Survey, Brainstorm, proposals

• Form team – QC forms a multifunction team if required

• Define scope – scope, goals, milestones


2 Analyze Process

• Develop Process Flow diagram

• Define target performance measures

• Relevant Data collection

• Fishbone diagram


3 Develop Optimal Solution (s)

• Brainstorm – create new process/combine different process/modify existing process

• Evaluate Test solutions using control charts – criteria: feasibility, scope, training and effects


4 Implement

• Prepare implementation plan

• Obtain approval

• Implement process improvements


5 Study the results

• Monitor and evaluate the change

• Check if fine tuning is needed

• If dissatisfied with results, repeat some phases


6 Standardize solution

• Positrol (Positive control) – ensures important variables are kept under control

• Process Certification

• Operator Certification


7 Plan for Future

• Regular reviews of progress by QC

• Knowledge Management System – save learnings

• Repeat Phase 1.


Kaizen

• Process of continuous improvement in small increments without complex technology or high costs making processes better

• Uses concepts like: Value/Non value added activities, Mudas, Motion studies, SOP, 5S, Visual Management, JIT etc

• 5S – Sort, Simplify, Sweep, Standardize, Sustain


Six Sigma

• Uses Cp analysis as a way to measure progress

• We should reduce the process variability σ to keep process centered on the target μ.

• Process Capability Index = USL-LSL/6 σ

• Process Performance Index Cpk= min(USL-X,X-LSL)/3 σ

• Default Cp >1, Cpk =1


Performance Measures


Strategy

• QC creates a total system of measures using info from stakeholders and firms’ VMG and values

• Ex: Quality• % reduction in nonconformities• % of certified suppliers


Strategy

• Cost• % increase in inventory turnover• % increase in output dollars per employee

• Similarly for innovation (NPD time), reliability (% processes having Cp=2), flexibility(setup time) etc.

• Tracked monthly to show trends, identify problems and allocate resources

• Depts create mechanisms and authorities to capture this data


Performance Measure Presentation

1. Time series graph (Time in days, weeks etc)

2. Control charts (R,Xbar)

3. Capability Index

4. Taguchi Loss Function

5. Cost of poor quality

6. Malcolm Balridge National Quality Award


Quality Costs

• Those costs associated with the non-achievement of product or service quality as is required

• Quality cost programs – quantifies this cost

• Use Pareto analysis to find major cost drivers


Quality Costs

• Preventive cost: Cost used up in preventing recurrence of some failure. Ex: Customer surveys, Product testing, Quality audits

• Appraisal cost: Cost of assuring acceptability of product. Ex: laboratory support, measuring equipment, certifications


Quality Costs

• Internal Failure Cost: cost to evaluate, dispose off, & either correct or replace nonconforming products prior to customer delivery. Ex: rework and scrap, poor supply materials, internal failure labor loss

• External Failure Cost: After delivery. Ex: returned goods, updates, warranty claims, penalties, lost sales, liabilities, goodwill


Malcolm Balridge National Quality Award

• Leadership 110• Strategic Planning 80• Customer and Market focus 80• Information and Analysis 80• HR Focus 100• Process Management 100• Business Results 450


Quality Management System


QMS

• Registration under ISO involves assessment and periodic surveillance audit of the adequacy of a supplier’s quality system by a 3rd party

• Benefits of ISO1. Customers are demanding compliance2. To improve processes/systems3. Global deployment of products4. Snowball effect


ISO 9000

• Generic in nature• It has 3 standards• ISO 9000:2000 QMS fundamentals/vocabulary• ISO 9000:2000 QMS requirements• ISO 9000:2000 QMS guidelines for

performance improvement


ISO 9001 requirements

1. Scope2. Normative reference3. Terms and Definitions4. QMS – General Reqs and Documents5. Management Responsibility6. Resource Management7. Product Realization8. Measurement, Analysis and Improvement


Process based QMS

5 Management Responsibility

8 Measurement Analysis and

Improvement

7 Product Realization

6 Resource Management

Input Requirements

Output Product


4 QMS Continual Improve

ment


Implementation1. Top management commitment2. Appoint management representative3. Awareness4. Appoint implementation team5. Training6. Time Schedule7. Select element owners8. Review present system9. Write the documents10. Install the new system11. Internal audit12. Management review13. Preassessment14. Registration


DocumentationPolicyP

rocedures

Work Instructions

Proof

What will be done and why ?

Who, When, Where

How


Statistical Process Control


Introduction

• SPC is a technical tool for improving product and service quality.

• Pareto Diagram• Process Flow Diagram• Cause and Effect Diagram• Check Sheets• Histogram


Pareto Diagram

• Vital few and the useful many• Ranks data classifications in descending order


Pareto Diagram

• Solving 50 % of vital few is better and easier than 50 % of useful many

• Never ending process


Process Flow Diagram


Cause and Effect Diagram

• Brainstorming essential. 4 or more likely causes determined by voting


Cause and Effect Diagram

• Wide scope for application

• Encourages participation and contribution by everyone

• Diagrams posted in key locations to stimulate continued reference


Check Sheets

• For ease of data collection• Customized for situation


Histograms

• Graphically estimates Cp, relationships to specifications and target, shape of population and gaps in data

• Graphical and analytical

• Ungrouped and Grouped data (for large data)


Normal curve

• Larger the Std Dev, flatter the curve (less data)


Types and Causes of variation

• Types1. Within piece2. Piece to piece3. Time to time

• Causes1. Equipment2. Material3. Environment4. Operator


Variable Control Charts


Process Capability

• σ = Rbar/d2

• Cp = (USL-LSL)/6 σ

• USL-LSL=tolerance

• X

• X

• Cpk = min{(USL-Xbar) or (Xbar-LSL)}/3 σ


Cp and Cpk

1. Cp value does not change as process center changes

2. Cp=Cpk process is centered3. Cpk<=Cp4. Cpk>1 process conforms to specifications5. Cpk<1 process not conforms to specifications6. Cp<1 process not capable7. Cpk=0 average =USL or LSL8. Cpk <0 average outside specifications


Scatter diagrams

• For correlations


BLUE OCEAN STRATEGY


X

Tqm

Business

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