Total Quality Management

Total Quality Management (TQM) is a management approach that aims for long-term success by focusing on customer satisfaction. TQM is based on the participation of all members of an organization in improving processes, products, services, and the culture in which they work.

Total Quality Management

Total - made up of the whole Quality - degree of excellence a product or service provides Management - act, art or manner of planning, controlling, directing,. Therefore, TQM is the art of managing the whole to achieve excellence.

The three aspects of TQM

Counting Customers Culture
Tools, techniques, and training in their use for analyzing, understanding, and solving quality problems Quality for the customer as a driving force and central concern.

Shared values and beliefs, expressed by leaders, that define and support quality.

Four Principles of TQM

Creating an organizational culture committed to the continuous improvement of skills, teamwork, processes, product and service quality, and customer satisfaction. Four Principles of TQM1. 2. 3. 4. Do it right the first time. Be customer-centered. Make continuous improvement a way of life. Build teamwork and empowerment.

What is Quality? What is Quality

Quality is defined as meeting the customers requirement for first time and every time Quality is much more than the absence of defects which allows us to meet customer expectation Quality is important factor affecting an organizations long term performance

Factor of Quality
Zero defect Cost Performance Reliability Durability User friendly

Quality Attributes in Service

Benchmark best level of quality achievement one company or companies seek to achieve Timeliness how quickly a service is provided

QUALITY
Quality improves productivity and competitiveness in any organization Quality can be implemented by1.Quality Assurance(QA) 2.Quality Control(QL)

Quality Assurance(QA)
QA is a planned and systematic set of activities necessary to provide adequate confidence that product and services will conform to specified requirements and meet user requirements. 1.It is process oriented 2.defect prevention based

Quality Control(QC)
QC is the process by which product quality is compared with applicable standards and action taken when non conformance is detected. 1.It is product oriented 2.defect detection based

QUALITY DIMENSIONS
Product- TV
Performance - Primary Characteristics,such as brightness
Features Secondary Characteristics,Remote Control

Conformance-Meeting Specifications or Standards

Reliability Consistency of Performance over time-fail

Durability- Useful life ,include Repair. Service

Dimensions of Quality
Durability- Useful life ,include repair.

Service-Resolution of problems,ease of repair.

Response- Human relations with Customers.

Reputation- Past performance, Company Image.

Determinants of Quality

Design

Ease of use Conforms to design

Service

Determinants of Quality
1. Design, planned quality
Intension of designers to include or exclude features in a product or service

EX: Designed size, actual durability Customer input is accounted for 2. Conformance to design (standards), executed quality
The degree to which goods or services conform to the intent of the designers

EX: Actual size, actual durability Design for quality: Design with quality in mind 3. Ease of use EX: Directions, instructions, training 4. Service after delivery

Continuous Improvement versus Traditional Approach

Traditional Approach Continuous Improvement

Product focus Individuals Focus on who and why Short-term focus Product focus Innovation

Customer focus Cross-functional teams Focus on what and how Long-term focus Continuous improvement Problem solving

PDCA Cycle
4. Act
Institutionalize improvement; continue cycle.

1. Plan Identify problem and develop plan for improvement.

3. Study/Check
Assess plan; is it working?

2. Do Implement plan on a test basis.

PDCA
Plan
Study a process Collect and evaluate data Develop an ACTION PLAN Try out the plan Evaluate the test run Take the necessary action, if your checkup reveals that the work is not being performed according to plan

Do

Check
Act

The TQM System

Objective

Continuous Improvement

Principles

Customer Focus

Process Improvement

Total Involvement

Elements

Leadership Education and Training Supportive structure Communications Reward and recognition Measurement

Reasons for TQM

A. Managers need to use their technical expertise and the quality process to improve product quality and their firms productivity B. Managers need to use their interpersonal skills as a change agent and contest for power in an organization

C. Managers need to understand that Quality is a part of production - it is not apart from production

Reasons for TQM

D. Engineers/Mangers need to be creative in improving the engineering process. E. Engineers/Managers need to think beyond issues of technology, and learn the means whereby people, processes and technology come together

Cost of Quality
The costs of quality can be divided into three categories 1.Prevention 2.Appraisal 3.Failure-Failure costs can be split into those resulting from internal and external failure

Prevention costs
Prevention costs are associated with the design, implementation and maintenance of the TQM system. They are planned and incurred before actual operation, and can include: Product Requirements The setting specifications for incoming materials, processes, finished products/services. Quality Planning Creation of plans for quality, reliability, operational, production and inspections. Quality Assurance The creation and maintenance of the quality system. Training The development, preparation and maintenance of processes.

Appraisal costs
Appraisal costs are associated with the vendors and customers evaluation of purchased materials and services to ensure they are within specification. They can include: Verification Inspection of incoming material against agreed upon specifications. Quality Audits Check that the quality system is functioning correctly. Vendor Evaluation Assessment and approval of vendors.

Failure costs
Failure costs can be split into those resulting from internal and external failure. Internal failure costs occur when results fail to reach quality standards and are detected before they are shipped to the customer. These can include: Waste Unnecessary work or holding stocks as a result of errors, poor organization or communication. Scrap Defective product or material that cannot be repaired, used or sold. Rework Correction of defective material or errors. Failure Analysis This is required to establish the causes of internal product failure.

External failure costs

External failure costs occur when the products or services fail to reach quality standards, but are not detected until after the customer receives the item. These can include: Repairs Servicing of returned products or at the customer site. Warranty Claims Items are replaced or services reperformed under warranty. Complaints All work and costs associated with dealing with customers complaints. Returns Transportation, investigation and handling of returned items.

Total Quality Management Principles

Provide understanding of and guidance on the application of TQM

A.Customer-Driven Organization
1. Organizations depend on their customers and therefore should understand current and future customer needs, meet customer requirements, and strive to exceed customer expectations

Total Quality Management Principles (Contd)

2. It requires 10 times as much money to attract a new customer than it requires to keep a customer you already have......keep the present customer happy

B.

Leadership
1. Leaders establish unity of purpose, direction, and the internal environment of organization; they fully involve people in achieving the organizations

objectives

Total Quality Management Principles (Contd)

2. The difference between an average and an outstanding company is the leadership they have

C. Involvement of People
1. People are the essence of an organization and their
full involvement enables their knowledge and experiences to be used for the organizations benefit 2. Employees are a companys greatest asset

Total Quality Management Principles (Contd)

3. An individual without information can not take responsibility; an individual with information can and will take responsibility

D. Process Approach
- A desired result is achieved more effectively when

related resources and activities are managed as a process

Total Quality Management Principles (Contd)

E. System Approach to Management
- Identifying, understanding, and managing a
system of interrelated processes for a given

objective will contribute to the effectiveness

and efficiency of the organization

Total Quality Management Principles (Contd)

F. Continual Improvement
1. Continual improvement is a permanent objective
of the organization 2. In the race for quality, there is no finish line 3. Quality comes from within; it comes from the hearts and the minds of the people

Total Quality Management Principles (Contd)

G. Factual Approach to Decision Making - Effective decisions and actions are based on the analysis of data and information

H. Mutually Beneficial Supplier Relationships

1. Mutually beneficial relationships are established to enhance the ability of both organizations to create value

Quality Process Component

A. Motivation
- based on recognition, commendation, recommendation, repeat business, reward

B. Communication
- must be team-wide, involving all partners, as well as thorough, honest, and complete

C. Commitment
- to the project, to the process, to all the partners, and to the promised result

Quality Process Component (Contd)

D. Expectations
- realistic, reasonable, communicated, understood, and accepted

E. Ability - adequate, understood, and consistent F. Involvement - total, all-party, and consistent G. Feedback
- thorough, understandable, and complete Follow-up - complete and consistent, as well as long term

The Process Improvement Cycle

Select a process Document Study/document

Evaluate

Implement the Improved process

Seek ways to Improve it

Design an Improved process

Barriers to TQM
A. Lack of trained workers/poorly installed equipment B. Poor plans and scheduling specifications/poorly defined work scope

C. Bad attitudes
D. Lack of competent field managers

Benefits of TQM
A. Better defined project scope and

objectives
B. Greater communication of objectives C. Teamwork D. Effective planning and scheduling E. Appropriate Training

Benefits of TQM (Contd)

F. Improved quality of materials,

equipment, and workmanship

Introduction
What is a customer? Anyone who is impacted by the product delivered by an organization. External customer: The end user as well as intermediate processors. Other external customers may not be purchasers but may have some connection with the product. Internal customer: Other divisions of the company that receive the processed product. What is a product? The output of the process carried out by the organization. It may be goods (e.g. automobiles, missile), software (e.g. a computer code, a report) or service (e.g. banking, insurance)
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customer satisfaction
How is customer satisfaction achieved? Two dimensions: Product features and Freedom from deficiencies. Product features Refers to quality of design. Examples in manufacturing industry: Performance, Reliability, Durability, Ease of use. Examples in service industry: Accuracy, Timeliness, Friendliness , Knowledge of server etc. Freedom from deficiencies Refers to quality of conformance. Higher conformance means no complaints and increased customer satisfaction.
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customer satisfaction
The basic principles for the Total Quality Management (TQM) philosophy of doing business are to satisfy the customer, satisfy the supplier, and continuously improve the business processes.Questions you may have are: How do you satisfy the customer? Why should you satisfy the supplier? What is continuous improvement?

Why Quality?
Reasons for quality becoming a cardinal priority for most organizations: Competition Todays market demand high quality products at low cost. Changing customer The new customer is not only commanding priority based on volume but is more demanding about the quality system. Product complexity As systems have become more complex, the reliability requirements for suppliers of components have become more stringent. Higher levels of customer satisfaction Higher customers expectations are getting spawned by increasing

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Quality perspectives
Everyone defines Quality based on their own perspective of it. Typical responses about the definition of quality would include: Perfection Consistency Eliminating waste Speed of delivery Compliance with policies and procedures Doing it right the first time Delighting or pleasing customers Total customer satisfaction and service
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1. 2. 3. 4. 5. 6. 7.

8.

Quality perspectives
Judgmental perspective goodness of a product. Shewharts transcendental definition of quality absolute and universally recognizable, a mark of uncompromising standards and high achievement. Product-based perspective function of a specific, measurable variable and that differences in quality reflect differences in quantity of some product attributes. Example: Quality and price perceived relationship.

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Quality perspectives
User-based perspective fitness for intended use. Individuals have different needs and wants, and hence different quality standards.

Value-based perspective quality product is the one that is as useful as competing products and is sold at a lesser price.

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Quality perspectives
Manufacturing-based perspective the desirable outcome of a engineering and manufacturing practice, or conformance to specification. Engineering specifications are the key! Example: Coca-cola quality is about manufacturing a product that people can depend on every time they reach for it.

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Quality levels
At organizational level, we need to ask following questions: Which products and services meet your expectations? Which products and services you need that you are not currently receiving? At process level, we need to ask: What products and services are most important to the external customer? What processes produce those products and services? What are the key inputs to those processes? Which processes have most significant effects on the organizations performance standards?
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Quality levels
At the individual job level, we should ask:

What is required by the customer? How can the requirements be measured? What is the specific standard for each measure?
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Evolution of TQM philosophies

The Deming Philosophy Definition of quality, A product or a service possesses quality if it helps somebody and enjoys a good and sustainable market. Improve Decrease cost Productivity improves quality because of less rework, fewer mistakes. Capture the Long-term Stay in market with competitiv business better quality and e strength reduced cost.
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The Deming philosophy

14 points for management: 1. Create and publish to all employees a statement of the aims and purposes of the company. The management must demonstrate their commitment to this statement. 2. Learn the new philosophy. 3. Understand the purpose of inspection to reduce the cost and improve the processes. 4. End the practice of awarding business on the basis of price tag alone. 5. Improve constantly and forever the system of production and service.
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The Deming philosophy

6. 7. 8. 9. 10. 11. 12. 13. 14. Institute training Teach and institute leadership. Drive out fear. Create an environment of innovation. Optimize the team efforts towards the aims and purposes of the company. Eliminate exhortations for the workforce. Eliminate numerical quotas for production. Remove the barriers that rob pride of workmanship. Encourage learning and self-improvement. Take action to accomplish the transformation.
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The Deming philosophy

1. A System of Profound Knowledge Appreciation for a system - A system is a set of functions or activities within an organization that work together to achieve organizational goals. Managements job is to optimize the system. (not parts of system, but the whole!). System requires co-operation. Psychology The designers and implementers of decisions are people. Hence understanding their psychology is important.

2.

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The Deming philosophy

3. Understanding process variation A production process contains many sources of variation. Reduction in variation improves quality. Two types of variations- common causes and special causes. Focus on the special causes. Common causes can be reduced only by change of technology. Theory of knowledge Management decisions should be driven by facts, data and justifiable theories. Dont follow the managements fads!

4.

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The Juran philosophy

1. 2. Pursue quality on two levels: The mission of the firm as a whole is to achieve high product quality. The mission of each individual department is to achieve high production quality. Quality should be talked about in a language senior management understands: money (cost of poor quality). At operational level, focus should be on conformance to specifications through elimination of defects- use of statistical methods.

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The Juran philosophy

Quality Trilogy 1. Quality planning: Process of preparing to meet quality goals. Involves understanding customer needs and developing product features. 2. Quality control: Process of meeting quality goals during operations. Control parameters. Measuring the deviation and taking action. 3. Quality improvement: Process for breaking through to unprecedented levels of performance. Identify areas of improvement and get the right people to bring about the change.
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The Crosby philosophy

Absolutes of Management Quality means conformance to requirements not elegance. There is no such thing as quality problem. There is no such thing as economics of quality: it is always cheaper to do the job right the first time. The only performance measurement is the cost of quality: the cost of non-conformance. Basic Elements of Improvement Determination (commitment by the top management) Education (of the employees towards Zero Defects (ZD)) Implementation (of the organizational processes towards ZD)
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Tools of TQM
A. Check Sheet 1. Tabulates frequency of occurrence
2. Easy to use and understand 3. Data gathered here can be used in other tools

Tools of TQM
B. Graph
1. Visual display of data 2. Major types a) Line graph

(Contd)

b)
c)

Bar chart
Circle diagram (pie chart)

Tools of TQM
C. Histogram -

(Contd)

1. Portrays frequency of occurrence 2. Shows various measures of central tendency

D.

Pareto Chart 1. Visually portrays problems and causes in order of severity or frequency

Tools of TQM

(Contd)

2. Helps determine which problems or cause to tackle first

E.

Cause-and-effect diagram
1. Portrays possible causes of a process problem

2. Helps determine root cause

Tools of TQM
F. Scatter diagram

(Contd)

1. Indicates the relationship between two variables 2. Displays the strength of that relationship

G. Control Chart 1. Monitors a process to determine magnitude of variation

Tools of TQM

(Contd)

2. Estimates the parameters of a process 3. Reduces the variability of a process

H. Flowchart
1. Portrays all the steps in a process 2. Helps understand the process

Goals of TQM
The goals of TQM are as follows1.Customer satisfaction in totality 2.Continous Improvement 3.Total employee involvement and empowerment 4.Optimization of resources 5.Do it right the first time