Sustaining Business Excellence through TQM Presented by T Gi i T.Giriprasad d Business Head – Rane Auto Parts Rane Group Slide No: 1 of 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing 2/ 55 Rane Group – An overview Operationally Independent & Strategically Aligned Rane Holdings Ltd. Rane Brake Lining Ltd Rane Engine Valve Ltd Kar Mobiles Ltd Linkage Products Sasmos HET Technologies Rane NSK Steering Systems Ltd Rane TRW Steering Systems Ltd Rane (Madras) Ltd Steering Systems & Rane Auto Parts Die i Cast Division Steering St i Gear G Division Occupant O t Safety S f t Division Division Listed Company 3/ 55 Product Range R Rane B k Li Brake Lining i Limited Li it d R Rane E i Valve Engine V l Limited Li it d Brake Linings, Disc Pads, Clutch Facings, Composite Brake Blocks,CV Brake pads and Sintered Brake Pads Engine Valves, Valve Guides, Tappets Rane (Madras) Limited Steering Division Manual Steering Gears, Steering Linkages, Suspension Components & Hydraulic Products 4/ 55 Diecasting division High Pressure Die Casting Products Product Range Rane NSK Steering Systems Limited Steering Columns & Electric Power Steering Rane TRW Steering Systems Limited Hydraulic Power Steering Systems, Occupant safety systems Kar Mobiles Limited Large Engine Valves for Power Generation, Marine & Special p Applications pp 5/ 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing 6/ 55 Why TQM for Business Excellence E i Environment t in i 1990s 1990 Commencing in 1991, there were dramatic shifts in the policy environment. A economy closed An l d ffor fforty t five fi years opened d up. Major car companies from across the world set up manufacturing operations in I di and India d encouraged d their th i suppliers li also l tto come to t India. I di Evidently the car companies not only saw sizable markets but also local capability and d llow costt opportunities t iti tto supply l th them with ith llocally ll made d components. t While there was lot of potential in market, Rane could not capitalize quickly as we g g huge g financial losses……. were undergoing Hence, an Organizational level self analysis was carried out. 7/ 55 Why TQM for Business Excellence Rane had launched various initiatives like Manufacturing system re-design The results were not satisfactory since the quality levels and process robustness were nowhere near world class standards. Our introspection indicated requirement for major improvements in : ¾ Management methods ¾ Education and training ¾ Total employee involvement 8/ 55 Why TQM for Business Excellence The improvement areas identified were the strong forte of the Japanese p management g p principles p with also cultural similarities between the two countries Hence Rane felt embracing the “Japanese management principles” would help in its objective While some of the practices like TPM, Lean production system, etc., t facilitated f ilit t d operational ti l excellence, ll R Rane wanted t d tto llook k att a management practice with a larger scope for achieving business excellence Therefore Rane decided to adopt TQM as an answer to this challenge 9/ 55 Why TQM for Business Excellence Mission & Value A one day TQMproducts workshop byservices Dr. Washio from JUSE was arranged Provide superior and to our customers and maintain in December 1999 1999. market leadership. The workshop confirmed our assumption that TQM would be a Evolve as an institution that serves the best interests of all holistic input p that would address all our concerns. stakeholders. t k h ld The commencement of Japanese way of TQM (in 2000) is a Pursue excellence throughhistory total quality watershed in the evolving of Ranemanagement. Ensure the highest standards of ethics and integrity in all our actions. 10/ 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing 11/ 55 TQM Philosophies TQM methodology th d l is i b built ilt on th three core philosophies CustomerFocus Focus ¾ Customer ¾ Continuous improvement ¾ Total Employee involvement Customer Focus TQM Continuous Improvement (Kaizen) Total Employee Involvement (TEI) Three core philosophies of TQM © Copyright Toyota 12/ 55 Customer Focus The conventional approach to customer relationship was no longer adequate. Rane responded to this by shifting the customer relationship from a "transactional” one to “collaborative” mode This redefined the way we approach our customers Understand customer needs Create value to the customer 13/ 55 Develop a feedback system Customer Focus Model ¾ “Four Four levels levels” approach for enhancing Customer Focus within the organization Level 4 Champion Customer Focus Culture Level 3 Anticipate Customer Needs Level 2 Seek Customer Feedback to Add Value Level 1 Deliver a Product Each level has been defined defined… Level Level 3 Approach Proactive Activities ¾ Use of tools like QFD ¾ Proactive Visits by Operators to Customer locations ¾ Solution to end customers customers’ problems 14/ 55 TQM Philosophies TQM methodology th d l was built b ilt on th three core philosophies TQM triangle model ¾ Customer Focus Continuousimprovement Improvement ¾ Continuous ¾ Total Employee involvement Customer Focus TQM Continuous Improvement (Kaizen) Total Employee Involvement (TEI) Three core philosophies of TQM © Copyright Toyota 15/ 55 Continuous Improvement This is a long term approach that continually examines processes to discover and eliminate problems Evaluate various a ous solutions to the problems Analysis of current status and Identify problems p Rane’s Rane s experience Implement actions Monitor results Rane created an environment that encouraged surfacing of problems : ¾ Culture of “openly admitting failures” - Senior management initiated this to set an example ¾ This enabled a mutual trust through which everyone shared their problems for resolution Continuous improvement has become an inseparable part of each and every business process…. 16/ 55 TQM Philosophies TQM methodology was built three th d l b ilt on th core philosophies TQM triangle model ¾ Customer Focus ¾ Continuous improvement ¾ Total Total Employee Employee involvement involvement Customer Focus TQM Continuous Improvement (Kaizen) Total Employee Involvement (TEI) Three core philosophies of TQM 17 of 28 © Copyright Toyota 17/ 55 Total Employee Involvement Thinking is not just the prerogative of only senior management TQM = TEI To begin with, Rane created transparency through communication ¾ Structured ‘monthly y communication meeting’ g was started. To enable participation from Operators, ‘Suggestion scheme’ was initiated to bring out their ideas and ‘Quality circles’ formed to foster team work All management staffs were part of Cross Functional Teams (CFT) to address complex issues involving various functions. Skill & Competency enhancement This resulted Thi lt d iin ‘O ‘Open culture’, lt ’ ‘breaking ‘b ki off functional f ti l silos’ and ‘a sense of organization wide ownership’ 18/ 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing 19/ 55 TQM Implementation structure TQM Organization g Introduction of Daily Routine Management Introduction of Policy deployment 20/ 55 TQM Organization Structure TQM Promotion P ti – Organizational O i ti l structure t t Plant level Company level Group level TQM Promotion Team Comprises of Plant Heads, Plant Dept. Heads and Plants,, Plant TQ Q Coordinator Responsibilities: To implement TQM activities & Apex council/ TQM Q Promotion Committee recommendations TQM Promotion Committee Comprises of President, SMG of Company and Plant / HO TQM Company, Coordinators Responsibilities: To promote TQM knowledge and motivate the human resource for implementation of TQM activities TQM Apex Council Comprises of Chairman, Presidents and TQ Coordinators of Group Companies and Group TQM Coordinator Responsibilities: To evolve overall policies and guidelines for group companies; assess implementation status at various locations through monthly audits ¾ A structured system at Plant, Companies and at Group was developed with clear responsibilities for TQM promotion. ¾ Based on the reviews, specific improvements are taken up in the practice of TQM. 21/ 55 TQM Implementation TQM O Organization i ti structure t t Introduction Introductionof ofDaily DailyRoutine RoutineManagement Management Introduction of Policy deployment 22/ 55 Daily Routine Management - Process Daily Routine Management (DRM) is done through “Bottom-up” approach and it is a base to enable every individual to perform work with clarity DRM not only covers daily jobs, but is also extended to long term jobs such as weekly, monthly & annual jobs. jobs Apart from efficiently carrying out routine activities, this also focuses on improvement activities. We impart a structured training programme on DRM at the induction stage. DRM – Role definition Role Definition : First, roles of individual employees are defined ¾ People had a tendency to talk expansively about their role but when it came to t actions ti it was very transactional t ti l ¾ A clear role description instilled clarity in responsibilities 23/ 55 Daily Routine Management - Process ¾ People stated that similar roles were being performed from manager level to supervisory level o Perception was that they were responsible from activity to decision making o Lack off clarity on role / delegation off authority (Cases (C like, ‘Responsible ‘ for f everything but, don’t know what to do’, & ‘Responsible for micro level activity yet, could not achieve targets’) ¾ Some areas were not the responsibility of anybody An Example: ¾ Executive in finance stated that he was responsible for collections ¾ He was actually responsible for providing the MIS to enable Marketing to collect DRMs of each individual was established through an iterative process and Managers play p ay a key ey role oe. If the managing points are not achieved, then the major measures are revisited and modified Here, Here the approach is towards addressing ‘what what went wrong’ wrong in the process which is in line with our TQM philosophy of “Focus on process than on the results”. 24/ 55 TQM Implementation TQM O Organization i ti structure t t Introduction of Daily Routine Management Introduction of of Policy deployment Introduction Policy deployment 25/ 55 Policy Deployment (PD) PD - Understanding Annual Policy deployment helps in Organizational alignment towards achieving prioritized ‘focus areas’ Targeted focus areas cuts across functions Organization-wide Organization wide and measures & targets are being cascaded from President to supervisory level (Top-down approach). PD – Our Experience At Rane, PD is minimum 20% improvement the R i defined d fi d to t have h i i i t from f th currentt level. l l We learnt limiting to 3 to 4 PD areas/year helped in channelizing organizational resources effectively. Deploying appropriate measures is a crucial factor for achieving intended results results. Example for Policy Deployment • PD policy: To achieve New Business sales growth • Deployment – Measure deployment to Marketing Head : RFQ generation – Measure deployment to OEM Head : Hit ratio of realizing business (Business conclusion) – Target deployment to Mktg executive : New business sales execution Learning: Deployment focus not limited to targets, but also measures 26/ 55 Policy Deployment System Mission corporate Vision Individual companies Company’s responsibility ¾ Policy management is through Catch balling & Negotiation. 27/ 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing – Key Principles 28/ 55 TQM Journey As explained already, Rane (Madras) Limited (RML) embraced TQM since 2000. There were two important phases in this continuous journey that we would like to share RML’s TQM Journey Phase 1 (2000-2007) 29/ 55 Phase 2 (2008 Onwards) Background - Challenges B i Business E Environment i t – Late L t 90s 90 C Company E Environment i t - Issues I Economy opened up Management oblivious to change Stiff competition in vehicle Industry Disbelief by employees on change Pressure on suppliers - QCD No ownership on organizational performance Belief that a few experts can solve issues As a result of changing environment, RML was a loss making company in the year 2000 2000. Following were the prevailing issues at RML 30/ 55 9 Low Morale Morale Low 9 Stagnant business 9 High Customer Returns 9 Low Asset Productivity 9 Weak supplier relationship Prevailing Culture All decision making was top down - Hierarchical RML worked in Tight Compartments & Business Performance was held as tight secret ((No Transparency) p y) Staying beyond working hours was an expectation regardless of need. Lack of convergence between Union and Management It was production at any cost There was an urgent need for a cultural change to bring an organizational transformation Attitude THE WAY WE THINK CULTURE THE WAY WE DO 31/ 55 Process Culture change transformation - Attitude Informa ation Sharin ng Honesty H Trust Value everyone Fairness & Dignity to all Honor commitments Encouraged decision making Diiscipline Enabling Environment for Culture Change Focus on issues Sharing of p failure byy Top Management Dignity of Labour Foundation was laid: Management communicated to employees that all are equal Each individual has a job to do and all jobs are important President held series of communication sessions about the new philosophy to gain confidence of employees COMMUNICATE, COMMUNICATE, COMMUNICATE… 32/ 55 Culture change transformation - Process QCC / Suggestion QIT scheme TQM Policy Policy Management Role & Responsibility Process PDCA SOP DRM © Copyright RML Various TQM processes were established to facilitate Culture change 33/ 55 RML’s TQM Journey As explained already, RML embraced TQM since 2000. There were two important phases in this continuous journey that we would like to share RML’s TQM Journey Phase 1 (2000-2007) 34/ 55 Phase 2 (2008 Onwards) DGP Journey : Major Activities Through the Strategic business planning process, Objectives were reset to align with the company’s Goals & Vision. In order to achieve those objectives RML identified 4 priority areas for organizational focus. Priority Areas Achieve World Class Quality Technical Leadership Competent & Self Motivated people Enhance Profitability Under each of these priority areas, major activities were identified for implementation 35/ 55 Priority areas A hi W ld Cl lit Achieve World Class Q Quality T h i lL d hi Technical Leadership Process robustness Process Process robustness robustness Product feature improvement Supplier S li d development l t New N range products d t Reliability improvement Competent & self-motivated people Enhance Profitability Enhancing Skill & Competency Focused Business Development Employee Employee morale morale & & TEI TEI Optimized Manufacturing Management Contribution to society Cost Management 36/ 55 Process robustness improvement: Post 2007 In our journey to achieve world class quality quality, new set of challenges were faced Increase in temporary workforce One off customer quality concerns Need to enhance supplier base inline with RML practices In h In‐house house IIn‐house Quality Quality Competent Manpower 37/ 55 Quality Management Supplier Quality Process robustness: In-house Quality As a first step step, all critical / significant characteristics & customer touch points were mapped for availability of controls. Controls ensured through Poka-yoke implementation and 100% SPC. However, one-off defects kept occurring due to inadequacy or failure of Poka yoke. p business experience, p , a single g assembly y defect ((operation p In our export missing) resulted in heavy sorting charges, penalty and customer dissatisfaction Failures in Poke-yokes were experienced due to ¾ Power cuts unique to India ¾ Provision of flexibility/options in the Poke-yoke Hence, there was a need for improving the y Robustness’ ‘Poke-yoke 38/ 55 Pokayoke Robustness Improvements We evolved a new process for challenging existing Poka yoke – Make it fail, learn and improve its robustness. Accordingly, we framed a rating criteria to evaluate Control, Mode and Effect of failure. B Based d on calculated l l t d PRN PRN, iimprovementt projects j t ((cases where h PRN >= > 3) are iimplemented l t d to improve its robustness. Nature of Control (NOC) Control Rating Pick-up Sensor 5 Detection type 4 Next cycle will not work 3 Next operation will not work 2 Parts cannot be produced / assembled 1 Nature of Occurrence (NOO) Nature of Failure (NOF) M d off Failure Mode F il Effect R ti Rating Rating Operator Error (Improper loading/ Pick-up) 2 Customer / Field 5 Auto / Manual switch tamper 2 Dock Audit / On-site 4 Power Failure Emergency Off No Positive Control No Failure Possible 2 2 2 1 PDI 3 Next Station / Operator 2 No Occurrence 1 Illustration of PRN calculation: Observation Rating Control Failure Effect Detection type pokayoke Audited and found pokayoke fails during Power cut Possibility of detection only at customer assembly line 4 2 5 Pokayoke Robustness Number in the above case is 4 x 2 x 5 = 40 39/ 55 Pokayoke Improvement – Example 2 Example: Poka yoke failure during power cut y Poka yoke description : Torque tightening with in-built control for achieving specified torque After Before Stopper cylinder Servo controlled torqueing unit During D i power cut, t retraction t ti off torqueing unit without achieving the specified torque observed Stopper cylinder introduced to ensure prevention ti off componentt unloading without cycle completion (Operator necessarily to repeat cycle after power resumption) Pokayoke strengthened against failure during power cut Similarly, 136 projects were implemented 40/ 55 Competent Manpower - Background In‐house Quality Competent p Manpower Quality Quality Management Supplier Supplier Quality With the increasing number of temporary workforce due to the current market conditions, focus on enhancing manpower competency was important This Thi was addressed dd d th through h ttwo ways Continuous skill upgradation through structured training through Error data bank Si Simplifying lif i th the operations ti and d th thereby b reducing d i skill kill requirement i t to perform the operation 41/ 55 Process simplification Define & Map skill level for micro-activities within each operation such as: a) Loading Loading b) Operation processing Example: Skill Definition for Loading Activity Auto loading & Clamping 1 Manual Loading & Auto clamping 2 Manual Loading & Manual clamping 3 Manual Loading & Manual multi clamping 4 c) Unloading d) Inspection e) Correction f) Setting Skill required Counter measure Simplify each micro-activity to reduce skill level required to operate 1 Case example 42/ 55 Case Example – Process simplification Before: Machine - External Cylindrical Grinder Skill Level: 4 Grinding size control -Manual After: In process Gauging Probe introduced In process Gauging Skill Level: 2 Similarly, 228 Process simplification projects were implemented 43/ 55 Four Priority areas Achieve World Class Quality Technical Leadership Process robustness Product feature improvement Supplier development New range products Reliability improvement Competent & self-motivated people Enhance Profitability Enhancing Skill & Competency Focused Business Development Employee Employee morale morale & & TEI TEI Optimized Manufacturing Management Contribution to society Cost Management 44/ 55 Employee Morale & TEI Approach in line with Maslow’s hierarchy Self -actualization actualization Creating Opportunity for People to participate for hi higher h causes th through h •• • Sustainability Sustainability CSR Self -Esteem • QCC Social • QIT • Kaizen K i • Suggestion Security • Remuneration Survival 45/ 55 • Welfare schemes Our Sustainability Model Environment Health Carbon neutraly Vision Sustainability Prevention of illness Holistic approach to health protection and enhance the quality ofmanagement life in the Enhancement of a better tomorrow for the future generation. sanitation & hygiene yg Water positive Zero waste To environmental ensure Material reduce & reuse community by providing Objective Saf benchmark t C model it for D Development l t To createSafety environment which can serve asCommunity Govt. bodies other neighboring industries. Zeroand accident Employee & Improvement in safety performance 46/ 55 Legal compliance Community nurturing nurturing govt Green G Green nurturing in in govt. govt. Schools Schools Green nurturing - Background RML joined with Karnataka State Pollution Control Board (KSPCB) in Green Nurturing Programme to inculcate ‘Clean’ and ‘Green’ aspects in local school. Objective of the programme is: Local Industries to adopt government schools to nurture green environment through better education and thereby contribute to social welfare . RML undertook Green nurturing as an initiative since; Aligns to our Sustainability vision S l iinvolvement l Scope ffor employee G.H.S-Hinkal 2.5 KM RML 3 KM G.H.S-Belavadi G.P.H.S-Savkarhundi G.P.H.S- Koorgalli 1.5KM 9 KM In this initiative, initiative KSPCB allocated 4 nearby schools by and these schools were evaluated on parameters like Water, Energy, Waste management, etc. Improvement areas were identified and implemented based on prioritization. 47/ 55 Green nurturing - Approach Awareness Session Demonstration at RML Facilitation Awareness - Segregation Check on Sustenance Competitions & Prizes Similarly actions initiated under other categories - Air quality, Energy, Water, Safety & Others 235 projects j t iin th the areas off W Water, t E Environment, i t S Safety, f t G Green nurturing t i iin th the last 3 years with employee participation of 85% 48/ 55 Green nurturing – Results Awarded for Excellence in Green Manufacturing State Award for contribution to Education E l Employee participation ti i ti iin S Sustainability t i bilit and d other th CSR iinitiatives iti ti h has h helped l d to enhance ‘Pride and Belongingness’ in employees. 49/ 55 Overall effects – Last 4 years Achieve World Class Quality Process robustness Supplier development World Class Quality – Overall Effects 100% of stations covered under SPC with Cpk > 1.33 1 33 Suppliers’ delivery consistency achieved at 99% Reliability improvement Customer line rejection reduced to < 25 ppm Technical Leadership Technical Leadership – Overall Effects Product feature improvement NPD sales enhanced from 17% to 27% New range products 16 New range products introduced, constituting 15% of future business 50/ 55 Overall effects – Last 4 years C t t & self-motivated lf ti t d Competent people C t t & self-motivated lf ti t d people l – Competent Overall Effects Enhancing g Skill & Competency p y 68% of Operators moved to higher skill level (Level (Le el 3 & Level Le el 4) Employee morale & TEI Suggestion / employee / year improved from 5 to 22. Contribution to society Enhance Profitability Focused Business Development Optimized Manufacturing Management Cost Management 51/ 55 124 CSR projects ¾ 60% Employee participation ¾ More than 7000 beneficiaries. Enhance Profitability – Overall Effects Sales turnover doubled from Rs. 3400 million to Rs. 6600 million Asset productivity (7 times) – Benchmark in Industry Return on Net Assets improved to 25.8 times TQM Excellence - Recognition 2003 – Rane Brake Lining Limited wins Deming Prize 2005 – Rane Engine Valve Limited wins Deming Prize 2005 – Rane TRW Steering Systems Limited (SGD) wins Deming Prize 2007 – Rane (Madras) Limited wins Deming Prize 4 of Rane group companies have won Deming Application prize 2011 – Rane TRW Steering g Systems y Limited ((SGD)) wins Japanese Quality Medal (JQM) award 2012 – Rane (Madras) Limited wins Deming Grand Prize (DGP) award. 2013 – Rane Brake Lining wins Deming Grand Prize (DGP) award. Rane is: 1stt group to t win i 3C Consecutive ti DGP awards d outside t id JJapan 2nd group in the world to win more than 2 DGP awards 52/ 55 Contents About Rane group Why TQM for Business Excellence Core Philosophies TQM Implementation Deming D i G Grand dP Prize i JJourney ¾ Case study: Rane (Madras) Limited - Journey Summarizing 53/ 55 Sustenance of Business Excellence Rane Group comprises of 8 companies with 25 plants and diverse / varying product portfolio. While maintaining the individual identity and deliverables, several opportunities exist for cross - learning & Benchmarking To achieve the synergy of ideas and best practices practices, group level forums have been created with representation from each company Forum 54/ 55 Objective j Members Apex TQM council To assess and guide TQM implementation Chairman, Presidents of group companies Strategic Review Forum To share the strategic business plans and seek feedback Chairman, Presidents and plant / functional heads of group companies Functional forums To share best practices and lay down guidelines. Comprises functional teams of all the companies facilitated at corporate level LPS Apex council Promote Lean manufacturing practices Vice-Chairman, Vice Chairman Presidents and LPS co-ordinators of the companies “Ordinary Ordinary people trying to do Extraordinary things” End of Presentation 55/ 55