Group: QRMS1202_Team5 : Jainwit Tongbai ID: 1255321 Zeyd Bohurler ID: 1265886

1. Compare and contrast Lean thinking and Quality Management Theory Can they be complemented to achieve business success ? Group: QRMS1202_Team5 : Jainwit Tongbai ID: 1255321 Zeyd Bohurler ID: 1265886 Mathews John ID: 1259600 Thomas Oliphant ID: 1258996 Apoorva Ravikrishnan ID: 1262022 Vasileios Zisis ID: 1266493

2. CONTENTS : • Evolution of Quality Management Theory • Deming Philosophy • Deming Cycle by Dr. Shewhart • Ishikawa Quality Theory • Total Quality Management • Six Sigma • Lean Thinking • Compare and Contrast : Fit for business success

3. Evolution of Quality Management Theory Early 1950’s Americans who took the messages of quality to Japan Late 1950’s Japanese who developed new concepts in response to the Americans 1970’s-1980’s Western gurus who followed the Japanese industrial success

4. Deming Philosophy : Quality Management Theory • Management is to be responsible for 94% of quality problems. • Place the importance and responsibility both individual level and company level. • 14 points of philosophy • Small , large organisation ; public , private or service sectors.

5. Deming’s Quotes Quality Management Theory “If you do not know how to ask the right question, you discover nothing.” W. Edwards Deming “It is not enough to do your best, you must know what to do, and then do your best.” W. Edwards Deming “ Hold everybody accountable ? Ridiculous ! ” W. Edwards Deming “Quality is everyone's responsibility. ” W. Edwards Deming “ Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them.” W. Edwards Deming “ You should not ask questions without knowledge. ” W. Edwards Deming “Lack of knowledge... that is the problem. ” W. Edwards Deming

6. Deming 14 Points Edwards Deming Philosophy 1 Create constancy of purpose towards improvement of product and service 2 Adopt the new philosophy. We can no longer live with commonly accepted levels of delay, mistakes and defective workmanship 3 Cease dependence on mass inspection. Instead, require statistical evidence that quality is built in 4 End the practice of awarding business on the basis of price 5 Find problems. It is management’s job to work continually on the system 6 Institute modern methods of training on the job 7 Institute modern methods of supervision of production workers, The responsibility of foremen must be changed from numbers to quality 8 Drive out fear, so that everyone may work effectively for the company 9 Break down barriers between departments 10 Eliminate numerical goals, posters and slogans for the workforce asking for new levels of productivity without providing methods 11 Eliminate work standards that prescribe numerical quotas 12 Remove barriers that stand between the hourly worker and their right to pride of workmanship 13 Institute a vigorous programme of education and retraining 14 Create a structure in top management that will push on the above points every day

7. Deming 14 Points 2. The new Philosophy : 1. Constancy of purpose: 4. End lowest tender contracts : 3. Cease mass production inspection:

8. Deming 14 Points 5. Improve every process 6. Institute training on the job : 7. Institute leadership of people 8. Drive out fear

9. Deming 14 Points 9. Breakdown barriers 10. Eliminate slogans / Do it right first time 11. Eliminate arbitrary numerical targets: 12. Permit pride of workmanships

10. Deming 14 Points 13. Encourage education 14. Top management commitment and actions : • Put everybody in organisation to work to accomplish the change. • Institute a vigorous programme of education • and self-improvement.

11. Systematic Approach : Deming Cycle by Dr. Shewhart Father of Gurus Quality Process is Under Control Continious Improvement Control Charts

12. Dr. Ishikawa – 7 QC Tools : Quality Management Theory • Late 1950’s Japanese developed new concepts in response to the Americans Management of Quality 7 Quality Tools Customer Orientation Managing the Quality Customer Orientation Japanese Way of Quality 7 Quality Tools

13. Dr. Ishikawa – 7 QC Tools Late 1950’s Japanese developed new concepts in response to the Americans 7 Tools : • Pareto analysis  Which are the big problems? • Cause and effect diagrams  What causes the problems? • Stratification  How is the data made up? • Check sheets  How often it occurs or is done? • Histograms  What do overall variations look like? • Scatter charts  What are the relationships between factors? • Process control charts  Which variations to control and how?

14. Dr. Ishikawa – 7 QC Tools Late 1950’s Japanese developed new concepts in response to the Americans 7 Tools : • Pareto analysis  Which are the big problems? • Cause and effect diagrams  What causes the problems? • Stratification  How is the data made up? • Check sheets  How often it occurs or is done? • Histograms  What do overall variations look like? • Scatter charts  What are the relationships between factors? • Process control charts  Which variations to control and how?

15. Total Quality Management : Concepts • At its core, total quality management (TQM) is a management approach to long–term success through customer satisfaction. • In a TQM effort, all members of an organization participate in improving processes, products, services, and the culture in which they work.

16. Total Quality Management • The primary elements can be classified as: • Customer-focused. • Total employee involvement. • Process-centered. • Integrated system. • Strategic and systematic approach. • Continual improvement. • Fact-based decision making. • Communications. • Total quality management can be summarized as a management system • for a customer focused organization that involves all employees in continual • improvement. • It uses strategy, data, and effective communications to integrate the quality discipline into the culture and activities of the organization.

17. Total Quality Management • Total Quality Management has few short-term advantages. Most of its benefits are • long-term and come into effect only after it is running smoothly. • Advantages of Total Quality Management: • Improves reputation- faults and problems are spotted and sorted quicker (zero defects) • Higher employee morale– workers motivated by extra responsibility, team work and involvement in decisions of TQM • Lower costs – Decrease waste as fewer defective products and no need for separate • Quality Control inspectors • Disadvantages of Total Quality Management: • Initial introduction costs- training workers and disrupting current production whilst being implemented • Benefits may not be seen for several years • Workers may be resistant to change – may feel less secure in jobs • By focusing too much on the customers, the production based method might have a cheaper and more faster way of doing business and this method is rejected. • Also the costs of inspection of processes as well as Research and development projects might be too costly.

18. Six Sigma • Motorola developed six sigma in 1987 • Similar to other quality management techniques but represents an organizational approach to improvement • Ford, Honeywell- famous organizations to have implemented six sigma

19. Definition • “Business process that allows companies to drastically improve their bottom line by designing and monitoring everyday activities in ways that minimize wastes and resources while increasing customer satisfaction” -Harry and Schroeder

20. Advantages of Six Sigma • Achieve maximum customer satisfaction and minimize the defects • Profitability increases and Costs reduce • Can be implemented in any business • Targets Variation in the processes and focuses on the process improvement rather than final outcome • Focuses on prevention on defects rather than fixing it

21. Disadvantages of Six Sigma • Emphasis on the rigidity of the process which contradicts innovation and creativity • Require skilled man force • A lot of real time barriers need to be resolved • Immediate results are not seen

22. Lean Thinking Concept

23. Lean Principles Lean Principles There are five Principles that help us seek lean: • Specify Value • Identify the value stream • Make the value flow • Let the customer pull • Pursue perfection

24. Lean Enablers There are four lean enablers: • Value Stream Mapping • Visual Management • Standardisation • 5 S (sort, segregate, shine, standardise, sustain)

25. Lean Techniques We can use six lean techniques (especially during NPI) • Project Management • Integrated Product Team • Knowledge Management • Risk Assessment • Requirements Capture • Core Competence

26. Six Sigma Business Advantages • It focuses on the customer • It gives clear objectives and goals to aim for • 3.14 dpmo • It’s a systematic approach • Its Measurable and quantifiable • It uses well-proven statistical tools • It gives a change in culture • Inspired by Deming’s Plan, Do, Check, Act cycle • Through reducing variation it improves quality

27. TQM Business Advantages • It focuses on the customer • Improves and unifies processes • It gives employees moral through involvement in decisions • By reducing “waste” is reduces costs • Improves reputation through improved quality • Uses analytical and statistical tools

28. Lean Manufacturing Business Advantages • It focuses on the customer • Gives clear objectives and goals • By reducing “waste” you also reduce costs and increase quality • Reduces lead time • Improves flow in processes • Can be applied to all aspects of the business • Increases employee knowledge, become experts in their field • Improves cross-functional communication • Builds customer and supplier relations • Reduces effect of hierarchy

29. How can these tools be complemented to achieve business success? • All came about from the Japanese quality evolution • All inspired from Deming's work • All work towards reducing “waste” to maximise process utilization • These tools naturally complement themselves • Lean thinking moves towards JIT and zero “waste” • TQM focuses on the customer • Six Sigma focuses on reduction in variation • To successfully implement a mixture of these depends entirely on the business application • The mixture of techniques depends on what aspect the business would best benefit from focusing on

30. References ECTI (Electrical Engineering/Electronics, Computer, Telecommunications and Information Technology Association), 2008. 5th Annual International Conference of Electrical Engineering/Electronics, Computer, Telecommunications and Information Technology Association. Bangkok, Thailand 14-17 May 2008. Bangkok: Thailand Rahmere, R. , 2011. Top 50 EMS providers cross $150 billion mark , Electronics Manufacturing Asia, [online] Available at:< http://www.emasiamag.com/article5659top50emsproviderscross 150billionmark-Asia.html> [Accessed 29 July 2012] SVI Plc., 2011. The milestones, annual report 2010-2011, Bangkok, Thailand: SVI Plc. Whiteman, A. L., 2009. Project Management Challenges In The Global Economy, Project Management Solution, [online] Available at:<http://business.management6.com/Electronics-Manufacturing- Project-Management-Challenges-In-The-download-w9119.pdf> [Accessed 28 July 2012]

31. THANK YOU