TOTAL QUALITY MANAGEMENT: TQM

Origins, Evolution & key elements

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

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.

Demings Chain Reaction

Improve Quality Cost decreases Provide jobs and because of less rework, more jobs Stay in business

fewer mistakes, fewer delays, snags, better use of machine time and materials

Productivity improves Capture the market with better quality and lower price

The Deming Cycle or PDCA Cycle

PLAN

ACT

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

DO

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

CHECK

Implement the change on a small scale and measure the effects

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

W. Edwards Demings 14 Points 1)

2)

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.

3)

4)

W. Edwards Demings 14 Points

5)

Find problems. It is managements 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.

6) 7)

8)

W. Edwards Demings 14 Points

9) 10)

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.

11)

12)

W. Edwards Demings 14 Points

13)

14)

Institute a vigorous programme of education and retraining. Create a structure in top management that will push everyday on the above 13 points.

Demings System of Profound Knowledge

Appreciation for system

Knowledge about variation

Theory about knowledge

Knowledge of psychology

LEARNING AND TQM

Learning Process Improvement Quality Improvement Customer Satisfaction Shareholder Satisfaction Employee Satisfaction

BASIC PRINCIPLES OF TQM

Approach Scope Scale Philosophy Standard Control Theme

Management Led Company Wide Everyone is responsible for Quality Prevention not Detection Right First Time Cost of Quality On going Improvement

SEVEN DEADLY SINS OF TQM

Flight to nowhere One size fits all Substituting TQM for leadership Inside - Out indicators Mandatory religion Quality kept as a separate activity Teaching to the test Booz-Allen & Hamilton

CHAPTER 2

QUALITY COSTS

Quality
Means cost effectiveness It means introducing expenditure by eliminating wastes through systematic quality approach. It is important to count expenditure (expenses) incurred on account of poor quality in order to prevent it. It help leaders assess the effectiveness of the organization and the areas where the efforts are wasted.

TQM
Aims to qradually reduce wasteful expenditure and eventually eliminate them. Decreasing cost of production should indicate quality improvement. Thus, knowledge of the quality costs is important in TQM

COST OF QUALITY
COQ Means the sum of the costs incurred by the organization in preventing poor quality. There are 3 types of COQ:
Prevention costs Appraisal costs Failure costs

PAF MODEL
Preventi on Appraisa l

Failure internal external

Any quality cost which arises in an industry can be classified into one of the above categories.

PAF MODEL
The Prevention Costs
are the planned costs incurred by an organization to ensure that no defects occur in any of the stages such as design, development, production and delivery of a product or service. The expenses on account of TQM implementation is a prevention cost. e.g. Education and training, process improvements efforts, process control, market research, product qualification, field testing, preventive maintenance,

PAF MODEL
The Appraisal Costs
are incurred in verifying, checking, or evaluating a product or service at various stages during manufacturing or delivering. Incurred due to lack of confidence in the quality of the product or service either due to the incoming material or due to the process. e.g. Incoming inspection, internal product audit, supplier evaluation and

PAF MODEL
The Failure Costs
are incurred by an organization because the product or service did not meet the expected requirements and the product had to be fixed or replaced or the service had to be repeated. These costs are due to the incurred failure of the organization to control defects in the product

CLASSIFICATION OF FAILURE OF COSTS

INTERNAL FAILURE COSTS
Includes costs of every failure that takes place before the product is delivered to the customers. It accrues (accumulates) due to defective processes.

CAUSES OF INTERNAL COSTS

Rejected material, supplied by vendor Rejected pieces of sub assemblies Rejected products at final inspection Scrap on account of poor workmanship

CLASSIFICATION OF FAILURE OF COSTS

EXTERNAL FAILURE COSTS
There are on cost of failure of the product after its delivery to the customers.

EXAMPLES OF EXTERNAL COSTS

Warranty costs Free replacements given due to failure of items supplied Cost incurred to travel to customers site for repair Costs of products returned. Cost of customer complaint administration

Joseph M. Juran and the Cost Of Quality

Costs Total Costs Unavoidabl e costs

Avoidable costs 100% defective Point of Enough quality

Process Improvement:
A systematic approach to improving a process
The Process Improvement Cycle
Select a process Document Study/document Evaluate Implement the Improved process Seek ways to Improve it

Design an Improved process

Process Improvement and Tools

Process improvement - a systematic approach to improving a process
Process mapping Analyze the process Redesign the process

Tools
There are a number of tools that can be used for problem solving and process improvement Tools aid in data collection and interpretation, and provide the basis for decision making

Basic Quality Tools

Flowcharts Check sheets Histograms Pareto Charts Scatter diagrams Control charts Cause-and-effect diagrams Run charts

Check Sheet
Billing Errors
Wrong Account Wrong Amount

Monday

A/R Errors
Wrong Account Wrong Amount

Pareto Analysis
80% of the 80% of the problems problems may be may be attributed attributed to 20% of to 20% of the the causes. causes.

Number of defects Off center

Smeared print

Missing label

Loose

Other

Control Chart
Figure11-9

1020 1010 1000 990 980 970 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

UCL

LCL

Cause-and-Effect Diagram
Figure11-10

Methods
Cause Cause Cause Cause Cause Cause

Materials
Cause Cause Cause Cause Cause Cause

Environment

Effect

People

Equipment

Run Chart

0.58 0.56 0.54 0.52 0.5 0.48 0.46 0.44 1 2 3 4 5 6 7 8 9 10 11 12 Time (Ho urs )

Diameter

Time (Hours)

Methods for Generating Ideas

Brainstorming Quality circles Interviewing Benchmarking 5W2H

what, why, where, when, who how, and how much

Benchmarking Process
Identify a critical process that needs improving Identify an organization that excels in this process Contact that organization Analyze the data Improve the critical process

COQ for Improvement

Benefits of COQ Analysis:
Brings out the magnitude of the quality problem in the organization. Enables cost reduction owing to steps take for improvementbased on analysis. Enables taking steps to improve customer satisfaction. Displaying the results motivates employees to improve further.