Total Quality Management
Dr. Atishwar Pandaram
Sch. of Management and Public
Administration
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Operations Strategy Time Line
Cost
Quality
Delivery
Flexibility
Service
What is next
Time line
OM
paradigm
1950s
1960s 1970s
Cost
Minimization
1980s
|
1990s
2000s
Value
Maximization
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?
Definition of Quality:
Quality is a predictable degree of uniformity and dependability,
at low cost and suitable to the market (Deming)
Quality is fitness for use (Juran)
Quality is the conformance to requirements (Crosby)
Quality is the (minimum) loss imparted by a product to
society from the time the product is shipped. (Taguchi)
Quality is, in its essence, a way of managing the
organization (Feigenbaum)
Quality is correcting and preventing loss, not living with loss
(Hoshin)
ISO definition: Quality is the totality of characteristics of an
entity that bear on its ability to satisfy stated and implied
needs.
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Defining Quality
Perfection
Fast delivery
Providing a good, usable product
Eliminating waste
Consistency
Doing it right the first time
Delighting or pleasing customers
Total customer service and satisfaction
Compliance with policies and procedures
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Why Quality Management
1. Question of survival in an intense competitive environment
- Today LPG (Liberalized, Privatized and
Globalized) system has made the global market a single
one allowing almost free exchange of goods and services.
Suppliers not only face competition in the local
market but also from the international market.
The emphasis is on delighting and winning over
customers. Just conforming to specification and
satisfying customers is no more enough.
2. Increase customer consciousness:
Customers are more educated now.The needs of
customers also keep on changing fast. Unless the
suppliers are capable of satisfying the changed needs,
they loose the customers and ultimately the market
share.
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3. Need for earning profit instead of making profit:
Cost price + profit = Sales price (SP)
In the buyer dominated market, this equation is no more
valid. The supplier organization can only make profit by
controlling the cost. The components of the cost price are
the material cost, labour cost and energy cost etc. which
are very difficult to control. Only thing can be controlled is
‘Quality cost’.
Quality cost- cost incurred by organization by for making
non-conforming products. The cost of repair, reprocessing,
and scraping non-conforming products. To reduce quality
cost, the objective of the supplier should be to make things
right first time and every time - a TQM approach.
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Why Quality
Quality Up
Processing
Time down
Image up
Service
cost down
Sales
Volume up
Price(?)
Competition
down
Rework &
Scrap cost
down
Inspection &
test cost down
Scale
Economies
up
Inventory
Down [assume-goods sold]
Complaint &
Warranty cost
down
Productivity
Up---meaning?
Revenue
up
Capital
cost down-?
Operation
Cost down
Profits up
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Deming Chain Reaction
Improve quality
Costs decrease
Productivity improves
Increase market share with better
quality and lower prices
Stay in business
Provide jobs and more jobs
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Dimensions of Quality
A: For Manufacturing Products
Performance: Product’s primary operating characteristics
Features: Secondary characteristics that supplement the
products basic functioning
Reliability: The probability of a product’s survival over
a specified period of time under stated conditions
of use
Durability: The amount of use one gets from a product
before it physically deteriorates or until
replacement is made.
Serviceability: The ability to repair a product quickly
and easily
Aesthetics: How a product looks, feels, tastes, or smells
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B: For a Service:
Time: For much much time must a customer wait?
Timeliness: Will a service be performed when promised?
Completeness: Are all items in an order included?
Courtesy: Do front-line employees greet each customer
cheerfully and politely.
Consistency: Are services delivered in the same fashion
to every customer.
Accessibility and convenience: Is the service easy to
obtain?
Accuracy: Are the services performed right the first time?
Responsiveness: Can the service personnel respond
quickly and resolve unexpected
problem?
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Evolution of Quality
Time
Events
Prior to
20th century
Quality is an art
Demand overcome potential production
An era of workmanship
F. Taylor, 1900s
Scientific approach to management resulting in the
greater need for standardization, inspection and
supervision.
Shewart, 1930s
Statistical beginning and study of quality control
Late 1930s
Quality standard and approaches are introduced in
France and Japan. Beginning of SQC, reliability etc.
1942
Seminal work by Deming at the ministry of war in
USA, concept of acceptance sampling,
1944
Dodge and Deming carried out seminal work on
acceptance sampling
1945
Founding of Japan Standards Association
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1946
Founding of the ASQC (American Society for Quality
Control)
1950
Visit of Deming in Japan at the invitation of K. Ishikawa
1951
Quality assurance increasingly acceptable
1954
TQC in Japan (Feigenbaum and Juran), book
published in 1956
1957
Founding of European Organization for the control of
quality (France, Germany, Italy, Holland, England)
1961
The Martin Co. in USA introduced the zero-defect
approach. Quality motivation started in USA
1962
Quality Circles are started in Japan
1964
Ishikawa publishes a book on Quality Management
1970
Ishikawa publishes on basics of Quality circle, concepts
of Total quality is affirmed and devised in Japanese
industries.
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1970 to
1980
JIT and quality become crucial for competitiveness. A
large number of US and European corporations are
beginning to appreciate the advance of Japan’s
industries.
1980+
Facing the challenges of quality management
Growth of economic based quality control
The management of quality has become a
necessity that is recognized at all levels of
management.
Increasing importance is given to off-line quality
management for the design of robust
manufacturing processes and products,
services.
The growth of process optimization.
1990+
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Total Quality Management, usually called TQM, aspects of
which are also called Continuous Improvement,
Reengineering, Customer Focused Management, High
Performance Administration, is a philosophy of management
which considers the pursuit of quality in the product or
service provided by the organization as its central and
overarching strategy.
TQM is the latest paradigm of management theory and can
be appropriately considered as Fourth Generation
Management.
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TQM categorization:
1.Customer focus
2. Total participation and
teamwork
3. Continuous
improvement
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Thank you very much
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