TOTAL QUALITY
MANAGEMENT
Definition
• Total quality management is the integration of
all functions and processes within an
organization in order to achieve continuous
improvement of the quality of goods and
services. The goal is customers satisfaction`
Historical Evolution of
Total Quality Management
The historical evolution of Total Quality Management has taken
place in four stages:
They can be categorized as follows:
1. Quality inspection
2. Quality control
3. Quality assurance
4. Total Quality Management
First stage (QI)
• The first stage of this development took place in the 1910s
• When the Ford Motor Company’s ‘T’ Model car rolled off
the production line
• The company started to employ teams of inspectors to
compare or test the product with the project standard
• This was applied at all stages covering the production
process and delivery, etc.
• The purpose of the inspection was that the poor quality
product found by the inspectors would be separated from
the acceptable quality product and then would be
scrapped, reworked or sold as lower quality
First stage (QI)
• Second World War, manufacturing systems
became complex and the quality began to be
verified by inspections rather than the
workers themselves
• Statistical quality control by inspection methods designed by Shewhart and DodgeRoming during 1924–1931 were practised
through development of control charts and
accepting sampling
Second stage (QC)
• With further industrial advancement came the second stage
of TQM development and quality was controlled through
supervised skills, written specification, measurement and
standardization
• At this stage Shewhart introduced the idea that quality control
can help to distinguish and separate two types of process
variation;
– Firstly, the variation resulting from random causes
– Secondly, the variation resulting from assignable or special
causes
Second stage (QC)
• He also suggested that a process can be made to function
predictably by separating the variation due to special
causes
• Further, he designed a control chart for monitoring such
process variation in order to decide when to interact with
the process
• The main processes which help products and services to
meet customers’ needs are inspection and quality control
Third stage (QA )
• Quality Assurance contains all the previous stages in order
to provide sufficient confidence that a product or service
will satisfy customers’ needs
• Other activities such as comprehensive quality manuals,
use of cost of quality, development of process control and
auditing of quality systems were also developed in order to
progress from quality control to the quality assurance era
of Total Quality Management
• At this stage there was also an emphasis of change from
detection activities towards prevention of bad quality
Forth stage (TQM)
• Total Quality Management involves the understanding and
implementation of quality management principles and
concepts in every aspect of business activities
• Total Quality Management demands that the principles of
quality management must be applied at every level, every
stage and in every department of the organization
• The idea of Total Quality Management philosophy must
also be enriched by the application of sophisticated quality
management techniques
• The process of quality management would also be beyond
the inner organization in order to develop close
collaboration with suppliers
The Concept of TQM
• TQM means thinking about quality in terms of all
functions of the enterprise and a start to finish process
that integrates interrelated functions at all levels
• TQM ensures that the overall effectiveness of the
system is greater than the individual output of a
subsystem
• The subsystem includes:
–
–
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Design
Planning
Production
Distribution &
Field services
Quality - Definitions
• Quality is excellence that is better than a minimum
standard
It is conformance to standards and ‘fitness of purpose’
• ISO 9000:2000 definition of quality - It is the degree to
which a set of inherent characteristics fulfills
requirements
• Quality is ‘ fitness for use ‘ of the product –Joseph Juran
Quality and customer expectations
 Quality is also defined as excellence in the product or service
that fulfills or exceeds the expectations of the customer
 Though quality is an abstract perception, it has a quantitative
measure- Q= (P / E ) , where Q=quality, P= performance(as
measured by the Mfgr.), and E = expectations( of the
customer)
Quality and customer expectations
 Quality is not fine-tuning your product at the final stage of
manufacturing, before packaging and shipping
 Quality is in-built into the product at every stage from
conceiving –specification & design stages to prototyping –
testing and manufacturing stages
 TQM philosophy and guiding principles continuously
improve the Organization processes and result in customer
satisfaction
The 9 Dimensions of Quality
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Performance
Features
Conformance
----------------------------Reliability
Durability
Service
----------------------------Response- of Dealer/
Mfgr. to Customer
 Aesthetics – of product
 Reputation- of
Mfgr./Dealer
Performance
Cost
Service
Features
TQM’s Six Basic Concepts
 Management commitment to TQM principles
and methods & long term Quality plans for
the Organization
 Focus on customers – internal & external
 Quality at all levels of the work force
 Continuous improvement of the
production/business process
 Treating suppliers as partners
 Establish performance measures for the
processes
Effects of poor Quality
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Low customer satisfaction
Low productivity, sales & profit
Low morale of workforce
More re-work, material & labor costs
High inspection costs
Delay in shipping
High repair costs
Higher inventory costs
Greater waste of material
Benefits of Quality
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Higher customer satisfaction
Reliable products/services
Better efficiency of operations
More productivity & profit
Better morale of work force
Less wastage costs
Less Inspection costs
Improved process
More market share
Spread of happiness & prosperity
Better quality of life for all
The Deming Philosophy
Deming defines quality as a predictable degree of uniformity
and dependability, at low cost, and suited to the market
• Create and publish the aims and purposes of the
organization
• Learn the new philosophy
• Understand the purpose of inspection
• Stop awarding business based on price alone
• Improve constantly and forever the System
• Institute training
• Teach and institute leadership
The Deming Philosophy
• Drive out fear, create trust, and create a climate for
innovation
• Optimize the efforts of teams, groups, and staff areas
• Eliminate exhortations for the work force
• Eliminate numerical quotas for the work force
• Eliminate management by objectives
• Remove barriers to pride of workmanship
• Encourage education and self-improvement for all
• Take action to accomplish the transformation
Juran’s ten steps
Defines quality as fitness for use in terms of design, conformance,
availability, safety and field use
1. Build awareness of opportunities to improve
2. Set goals for improvement
3. Organise to reach goals
4. Provide training
5. Carry out projects to solve problems
6. Report progress
7. Give recognition
8. Communicate results
9. Keep score
10. Maintain momentum by making annual improvements part of the
regular systems and process of the company
Philip Crosby
He argues that poor quality in the average cost 20% of
revenues, most of which could be avoided by adopting
good practices. His absolutes of quality are:
1. Quality is defined as conformance to requirement,
not goodness
2. The system for achieving quality is prevention, not
appraisal
3. The performance standard is zero defects, not ‘’that’s
close enough’’
4. The measurement of quality is non-conformance, not
indexes
Crosby’s fourteen points
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
Management commitment – communicate through written policy
Quality improvement teams – to oversee improvements in de pts.
Quality measurement – identify areas in need of improvement
Cost of quality – areas where improvement would be profitable
Quality awareness – employees to understand conformance to Q.
Corrective action – review actions 3 to 4
Zero defect planning – program appropriate to company’s culture
Supervisor training – all levels of management to be trained
Zero defect day – designate a day for company’s standards
Goal setting – individuals/ groups to set goals for themselves
Error cause removal – problems that generates errors
Recognition – in-public appreciation to goal achievers
Quality councils – meet regularly to share experiences, ideas &
problems
14. Do it all over again
Common Themes of TQM Gurus
 Inspection is never the answer to quality improvement,
nor is policing
 Involvement of and leadership by top management are
essential to the necessary culture of commitment to
quality
 A program for quality requires organization wide efforts
and long term commitment, accompanied by necessary
investment in training
 Quality is first and schedules are secondary
Customer satisfaction
• Customer is the Boss or ’King’
• Customer dictates the market trends and direction
• Customer not only has needs to be supplied( basic
performance functions)
• Also he ‘wants what he wants!’( additional features
satisfy him and influence his purchase decision)
• Hence the Suppliers and Manufacturers have to closely
follow at the heel of the customer
What is customer satisfaction?
• Is it due to Product quality?
• Is it due to pricing?
• Is it due to good customer
service ?
• Is it due to company reputation?
• Is it something more?
Customer satisfaction/Dissatisfaction feedback
 Customer feedback has to be continuously sought and
monitored - not one-time only!( Pro-active! Complaints are
a reactive method of finding out there is a problem)
 Customer feedback can be relayed to manufacturer
 Performance comparison with competitors can be known
 Customers needs can be identified
 Relative priorities of quality can be obtained from the
horses’ mouth!
 Areas for improvement can be noted
Customer feedback methods
• Comment cards enclosed with warranty card when
product is purchased.
• Customer survey and questionnaire
• Customer visits
• Customer focus groups
• Quarterly reports
• Toll-free phones
• e-mail, Internet news groups, discussion forums
• Employee feedback
• Mass customization
The Baldrige Award
• Leadership – CEO, management for quality, public
responsibility
• Information and Analysis – use of data,
competitive comparisons, bench marking
• Strategic quality planning - company quality
performance plans
• Human resource development and managementemployee involvement, employee training/
education, employee performance, employee
satisfaction
The Baldrige Award
• Management of process quality-introduce quality products and services, process
management(delivery processes, support
services),supplier quality, assessment at all
stages
• Quality and operational results - product and
services result, company operational result,
supplier quality result
• Customer focus and satisfaction - customer
expectations, customer relationship with
management, customer satisfaction
Five ways to Improve a Process
• Reduce resources
• Reduce errors
• Meet or exceed expectations of
internal/external customers
• Make the process safer
• Make the process more satisfying to the person
doing it
Four Improvement Strategies
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Repair
Refinement
Renovation
Re-invention
TQM principles from the Japanese
The 3 K Method
• Kimerareta Kotoo
–
What has been
decided
• Kimerareta Tori
–
must be followed
• Kichim to Mamorukoto – as per standard
The 5s Method
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Seiko
Seiton
Seiso
Seiketso
Shitsuke
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Sort ( Proper arrangement )
Set ( Systematic or Orderliness )
Shine ( Sweep or clean-up )
Standard ( Personal cleanliness )
Sustain ( Self-discipline )
Kaizen…….Change for the better
• Kaizen is a philosophy that sees
improvement in productivity as
a gradual and methodical
process
• It makes the work environment
more efficient and effective
through its five founding
elements:
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Team work
Personal Discipline
Improved Morale
Quality Circles
Suggestions for Improvement
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Kaizen Principles
1.
2.
3.
4.
5.
6.
7.
8.
9.
Don't look for excuses, look for ways to make
things happen
Get rid of all old assumptions. Say "NO" to
status quo
Don't worry about being perfect - even if you
only get it half right “ start NOW
It does not cost money to do KAIZEN
If something is wrong "Fix it NOW
Good ideas flow when the going gets tough
Ask "WHY" five times - get to the root cause
Look for wisdom from Ten people rather than
one
Never stop doing KAIZEN
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Kaizen Cycle
Source: Archfield Consulting Group
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Benefits of Kaizen
• It is a process oriented approach, hence has lasting impact as
improvements are made where faults are identified
• There is a high level of employee involvement which
enhances their morale and motivation
• It helps to improve quality, there by enhancing customer
satisfaction
• It helps to improve productivity resulting in low cost of
operation
• It helps to reduce the rate of accidents thus improving work
safety
• It aids in waste reduction in areas such as inventory, waiting
time, transportation and others which in turn aids in better
utilization of space and resources
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Challenges faced by Kaizen
• Kaizen is a top-down approach
• It requires lot of effort especially by executives at the topmost level
• It is a people oriented approach. So employee support is
critical for successful implementation of Kaizen
• It should be a continuous process or else the expected
results would not be obtained
• It requires a long term discipline and commitment. So
everyone should be patient about the results
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14 Principles followed by
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Toyota was the first company to implement Kaizen
Base your management decisions on a long-term philosophy, even at the
expense of short-term financial goals
Create a continuous process flow to bring problems to the surface.
Use "pull" systems to avoid overproduction
Level out the workload (heijunka). (Work like the tortoise, not the hare)
Build a culture of stopping to fix problems, to get quality right the first time
Standardized tasks and processes are the foundation for continuous
improvement and employee empowerment
Use visual control so no problems are hidden
Use only reliable, thoroughly tested technology that serves your people and
processes
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14 Principles followed by
Toyota(Contd…)
• Grow leaders who thoroughly understand the work, live the
philosophy, and teach it to others
• Develop exceptional people and teams who follow your
company's philosophy
• Respect your extended network of partners and suppliers by
challenging them and helping them improve
• Go and see for yourself to thoroughly understand the
situation
• Make decisions slowly by consensus, thoroughly considering
all options; implement decisions rapidly (Nemawashi)
• Become a learning organization through relentless reflection
(hansei) and continuous improvement (Кaizen)
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Kaizen In Pakistan
• Difficult to implement because of the “no- problem” attitude
among Pakistanis
• We don’t give importance to customers though the attitude is
changing slowly
• They fail to implement QFD (Quality Function Design)
• But changes are happening
• Few Companies like PEL, Siemens have successfully
implemented Kaizen
• PEL has been able to reduce its workforce by half, increase its
production by 40%, revenues by 20% after they started
practicing Kaizen
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Kaizen In lhr PC
Problem:
Breakages in the main kitchen of PC Hotel Lahore were high due to
incorrect flow of cutlery and crockery during washing
Solution:
Kaizen team was set up. The system of one piece at a time into the
dishwasher was implemented. The layout of the dishwashing area was
changed to facilitate single-piece flow
Result:
The breakage of crockery came down by 28 per cent. Savings from the
stoppage of breakages are at Rs 6 lakh per annum
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Kaizen Technique
• Kaizen- defines the managements role in
continuously encouraging and implementing small
improvements in the individual & organization
• Break the complex process into sub-processes and
then improve the sub-processes
• Continuous improvements in small increments
make the process more efficient ,controllable and
adaptable
• Does not rely on more expense, or sophisticated
equipment and techniques
PDSA cycle- seven steps or phases
Right first time
A. Plane Plan of action based on analysis of the collected
data
B. Do
This may involves minimum PDCA cycle until the
issues of implementation are resolved
C. Check Where results after implementation are
compared with targets to asses if the expected
performance improvement has been achieved
D. Act
If the change has been successful then the out
come is standardized . If this change has not been
successful, however , the lesson are recorded and
the cycle starts again
Six sigma method
• Six sigma method can be defined as a business
improvement approach that seeks to find and eliminate
causes of defects and errors in manufacturing and
service process by focusing on outputs that are critical
to customers and a clear financial return for the
organization
• The term six sigma is based on a statistical measure that
equates to 3.4 or fewer errors or defects per million
opportunities that can be applied to all parts of an org.
• Create highly qualified process improvement experts,
who can apply improvement tools and lead teams
Comparison between Six sigma & TQM
TQM
• Is based largely on worker
empowerment and teams
• Its activities generally occur
within a function, process, or
individual work place
• Its training is generally limited to
simple improvement tools and
concepts
• It is focused on improvement
with little financial
accountability
SIX Sigma
• Is owned by business leader
champions
• Its functions are truly crossfunctional
• It focusses on more rigorous and
a structured problem solving
methodology DMAIC – define,
measure, analyse, improve and
control
• It requires a verifiable return on
investment and focus on the
bottom line