Total Quality Management

1. Total Quality Management Introduction

2. Definition • TQM • Total – the whole • Quality – degree of excellence/perfection • Management – act or art of handling, controlling etc. • Hence, TQM is “the art of managing the whole to achieve excellence.” • The golden rule explains it better; • “Do unto others as you would have them do unto you”.

3. Definition • TQM is both a; • Philosophy • Set of guiding principles That represent the foundation of a continuously improving organization. • TQM is the application of quantitative methods and human resources to improve all the processes within an organization & exceed customer needs now and in the future.

4. Definition • Process • Sequence of interdependent and linked procedures which, at every stage, consume one or more resources (employee time, energy, machines, money) to convert inputs (data, material, parts, etc.) into outputs. • These outputs then serve as inputs for the next stage until a known goal or end result is reached. • Procedure • A fixed, step-by-step sequence of activities or course of action (with definite start and end points) that must be followed in the same order to correctly perform a task. Repetitive procedures are called routines.

5. Basic Approach • TQM requires SIX basic concepts; • A committed and involved management to provide long-term top-to-bottom organizational support. • An unwavering focus on the customer, both internally & externally. • Effective involvement & utilization of the entire work force. • Treating suppliers as partners. • Continuous improvement of the business and production process. • Establish performance measures of the processes.

6. Basic Approach • Management Support • Quality council must be established • Quality goals be included in overall objectives • Customer focus • “voice of the customer” is the clue to “customer satisfaction”. • Entire work force involvement • All personnel must be trained in TQM. • Those affected by TQM program understand it better than anyone else; hence, they must be involved. • Suppliers as partners • On average 40% of sales dollar is purchased product; hence, supplier quality must be outstanding. • Move from “transactional” to “relational” partnership

7. Basic Approach 5. Continuous Improvement • It’s not one shot. It must be continual and ubiquitous. • Good places to begin; • On-time delivery • Order entry efficiency • Billing error rate • Scrap reduction • Supplier management • Technical techniques shall be used for problem solving i.e. • Benchmarking • ISO 9000 6. Performance measures shall be established e.g.: • Customer satisfaction • Percent non-conforming • Absenteeism

8. New vs. Old Cultures

9. New vs. Old Cultures • Small businesses can make this change faster. • This change will take time. It’s not an “over a night” solution. • A clear vision and missionare the key pre-requisites of this change.

10. Gurus of TQM • Shewhart • Developed control chart theory (Chapter 8) • In 1931, authored Economic Control of Quality of Manufactured Product. • Deming • Best known for his 14 points theory for Quality, Productivity & Competitive position (Chapter 2) • Authored Out of the Crisis & Quality, Productivity & Competitive Position • Juran • The Juran trilogy (Chapter 6) • In 1961, authored Juran’s Quality Control Handbook.

11. Gurus of TQM • Ishikawa • Best known for the development of the Cause & Effect Diagram (Chapter 18) • Also developed the Quality Circle Concept (Chapter 4) • Crosby • Authored Quality is Free in 1979. • According to him, “Doing it right the first time” is less expensive than the cost of detecting & correcting the non-conformities. • In 1984, authored Quality without Tears.

12. TQM Framework

13. Awareness • Without realization, an organization will not begin the transformation to TQM. • Awareness comes about when a company; • Loses market share • Realizes that quality and productivity go hand-in-hand • Automation & other productivity enhancements might not help if you are unable to market your product or service because of poor quality. • To sum the whole thing up, “Customer wants Value”. Give it to him.

14. Awareness • Quality and Productivity are not mutually exclusive. Rather, they are directly proportionate. • A measureof the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs. • Productivity is computed by dividing average output per period by the total costs incurredor resources (capital, energy, material, personnel) consumed in that period.

15. Awareness • Quality and Productivity are not mutually exclusive. Rather, they are directly proportionate. • To survive both domestic & global markets, Quality improvement is indispensible. • Quality Improvement is not limited to the Conformance of the product to the specifications, it also involves the inherentquality in the design of the system. • Again, • TQM does not occur overnight. • There are no short cuts. • The overemphasis on short-term results & profits must be set aside for the sake of long term planning & consistency.

16. Defining Quality • Usually we think of excellent product or service that fulfills or exceeds our expectations. • Hence, if a product surpasses our expectations, we consider it quality. • Thus, Quality is somewhat of an intangible based on perception. • However, quantitatively • Q = P/ E • If Q is greater than 1.0, then the customer has a good feeling about the product. And vice versa.

17. Defining Quality • ISO 9000:2000 definition • The degree to which a set of inherent characteristics fulfills requirements. • Degree – a quality that can be expressed in adjectives such as poor, good & excellent. • Inherent – existing in something as permanent. • Characteristics – quantitative or qualitative • Requirement – a stated or implied need by a person, organization itself.

18. Defining Quality • The NINE Dimensions of Quality for a Slide Projector

19. Obstacles to TQM • Lack of Management commitment • Inability to change organizational culture • They are used to it. Change will be resisted. • Follow the basic concepts of change management; • People change when they want to and to meet their own goals. • Never expect anyone to engage in behavior that will serve organization’s values unless adequate reason is given to them. • For the change to be accepted, people must be moved from fear to change. • Improper planning • All constituents of the organization must be involved in the development of the implementation plan and any modifications that occur as the plan evolves.

20. Obstacles to TQM (cont’d) • Lack of continuous training & education • Isolated individuals and departments • Paying inadequate attention to the customers • Inadequate use of empowerment (for the purpose of efficiency/productivity) • Failure to continually improve • “Even if you are on the right track, you will get run over if you just sit there.” • Never be satisfied.

21. Benefits of TQM • Quality • Employee participation • Teamwork • Working relationship • Customer satisfaction • Employee satisfaction • Productivity • Communication • Profitability • Market share

22. Benefits of TQM • A survey of 600 companies (Award group) before and after Winning Award for Quality with companies (Control group) with no Award for Quality. • No difference was found in both Groups before the Award, but the difference is clear (shown in the table) after the Award.