MGMT 19105

1. MGMT 19105 Quality Management

2. Welcome • Welcome to Quality Management (MGMT 19105). • Introducing – the lecturer • Introducing – the students • Who are you? • What are you studying? • Why are you doing Quality Management? • What experience do you have with quality?

3. Today’s Topics • Course Welcome and Introduction • Module Introduction • Terminology • Quality Management • Total Quality Management/Total Quality Approach • What is Quality? • Misconceptions About Quality Management • Quality Pioneers • Six Sigma • Conclusion & Next Week

4. The Course • Purpose: To give you an overview of quality management, with special emphasis on process oriented management in the production of goods and services, and procurement and supply management. • Approach: Practical application of quality theories and principles - examining global perspectives on competition, quality as a strategic mechanism, ethics and corporate responsibility, strategic alliances, organisational culture, profound customer satisfaction, ISO9000 certification, and quality tools and techniques.

5. Pre-reading (from Study Guide) Contemporary Manufacturing Concepts: • Goldratt, EM 1997, Critical chain. OR • May, M 2005, ‘Lean thinking for knowledge work’, Quality Progress, v. 38, n. 6.(Proquest). Modern Manufacturing Organisations: • Liker, J 2003, The Toyota way: 14 management principles from the world's greatest manufacturer. ‘Foundations of the Quality Movement’: • Deming, WE 2000, Out of the crisis. OR • Deming, WE 1994, ‘The need for change’, The Journal for Quality and Participation, v. 17,n. 7. (Proquest). Easy-to-read Book on Quality Management: • Bank, J 2000, The essence of total quality management, 2nd edn.

6. The Course (continued) • 12 Modules • Study Guide: • Objectives • Topics • Textbook & References • Blackboard • Course Profile • Assessment

7. 12 Modules • Understanding Quality and Total Quality • Quality, Competitiveness and Globalisation • Quality, Values and Ethics • Quality and Culture • Quality and the Customer • Empowerment and Teambuilding • Quality Through ISO9000 • Implementing Total Quality Management • Tools for Total Quality Management • Quality Problem Solving and Decision Making • Quality Function Deployment and Continual Improvement • Total Quality and Benchmarking and the Future for the Total Quality Approach

8. Assignment 1 Short Report (2000 words) A personal hygiene product (confirmed with your lecturer). • Describe how the quality of the product is communicated by the supplier. • Develop a rating scale for the quality of your product, and use the scale to demonstrate how the quality of the product can be compared with similar products from the same and/or different suppliers.

9. Assignment 1 (continued) Required: • Write a ‘short report’ (Guide for Students, p. 90-1). • Use organisation to demonstrate knowledge of course content. (Inc. extensive referencing.) • Do executive summary, introduction and conclusion. • Use appropriate headings. • Use at least 8 references. • Use minimal direct quotes. (Use your own words.) • Use in-text referencing and a reference list. Encouraged: • Use diagrams to reinforce the text in your assignment.

10. Assignment 1 (continued) Evaluation criteria (8 marks) Question 1 – describe how the quality of the product can be inferred from information available to the consumer. (This description must be supported by appropriate references.) (8 marks) Question 2 – develop an appropriate rating scale, and use it to demonstrate how the quality of the product can be compared with similar products from the same and/or different suppliers. (This comparison must be supported by appropriate references.) (4 marks) Clarity of expression and presentation – including the orderly and logical presentation of information, referencing, neatness, and the inclusion of an executive summary, introduction and conclusion. TOTAL: 20 Marks

11. Assignment 2 Short Report (2000 words) You are the new manager of a call centre. • You have twelve months to successfully implement total quality management (TQM). You must prepare a short report that describes how the organisation will implement TQM for the CEO/Owner. You are to: • Write an Action Plan for implementing TQM. • Describe each of the steps in the Action Plan in terms of ‘what’ and ‘why’. • Describe how you will prove you have successfully implemented TQM. You are not to use the process on pages 776-782 of the textbook!

12. Examination 2 hours (60% of total mark) • Short Answer Questions • answer 6 out of 8 • Longer Questions • answer 2 out of 4

13. Contacting Me • Email mgmt19105-admin@cqu.edu.au • Phone: School Administrator Officer

14. Course Approach • Workshop – not Lecture and Tutorial • Bring pen and paper; and textbook.(Will be doing activities in small groups.) • READ THE READINGS!!! • Venue, day and time • Breaks? • Potential Excursion – operating factory

15. Blackboard Q. Who has never used Blackboard? • Instructions for Blackboard: www.cqu.edu.au/blackboard/students • Blackboard includes: • Welcome, Course Profile and Lecture Slides. • Discussion about Assignment 1.

16. Blackboard (2)

17. Blackboard (3) Note the Tabs!!!

18. Announcements Course Information Course Profile Staff Information Course Coordinator only Resources Slideshows and Handouts Discussion Board Ongoing discussions Assessment (Online Submission for Rockhampton & Flex only) Blackboard (4)

20. Week 1 Understanding Quality and Total Quality

21. Module Objectives 1. Provide a thorough definition of quality. 2. Distinguish between the traditional and total quality views of quality. 3. Describe what is involved in the management of quality in terms of 11 key or critical elements of total quality. 4. Describe the role of the quality pioneers: Deming; Juran; Crosby; Ishikawa; Oakland and Taguchi. 5. Understand and explain the Six Sigma concept.

22. Readings • Study Guide Module 1 • Textbook Goetsch & Davis 2006Chapter 1. The Total Quality Approach to Quality Management • Electronic journal articlesGeorge, S 2002, ‘Bull or bear’.Petty, J 2000, ‘When near enough is not good enough’.Hoyer, RW and Hoyer, BBY 2001, ‘What is quality?’Hensler, D and Klefsjo, B 2004, ‘Why is it difficult to succeed with quality improvements?’Anonymous 2003, ‘Viewpoint: Six sigma implementation’. (All available on Proquest)

23. Terminology Quality Management • The term ‘Quality Management’ used in this course applies to how organisations ensure they can offer quality products and services. Total Quality Management (TQM) • The term ‘total quality management’ is used as the name of a movement, an approach and as a business philosophy. • Total quality management is defined in the textbook (Goetsch & Davis 2006, p. 6).

24. Terminology (continued) Robert Flood (1993) defines TQM as: ‘Total’ means… “everyone should be involved in quality, at all levels, and across all functions, ensuring quality is achieved according to requirements in everything they do.” “Quality means meeting customer (agreed) requirements' , formal and informal, at lowest cost, first time every time.” ‘Management’ refers to “the need for everyone to be responsible for managing their own jobs, which incorporates managers with workers and anyone else associated with the organisation.” (Source: Flood, R. 1993 Beyond TQM, Wiley, London, p. unknown.)

25. Terminology (continued) TQM is… 1. A process to manage the quality of the product or service. 2. A management tool applied to the whole organisation, used to ensure that an organisation retains a competitive edge. 3. A set of principles such as "Business success can only be achieved by understanding and fulfilling the needs of the customers“. 4. A philosophy which applies the word total in an almost fanatical way. 5. A management fad which will go the way of all management fads.

26. Terminology (continued) Total Quality Approach • Although the textbook uses the term ‘total quality management’ in the title, it uses ‘total quality approach’ inside. • The terms ‘total quality management’ and ‘total quality approach’ are synonymous. • Searching for books and journal articles, search for total quality management’ rather than ‘total quality approach’.

27. Terminology (continued) What is ‘total’? • All employees, all departments/divisions/sections/teams in the organisation, all inputs, all processes and all outputs – everything an organisation is and does. What about not total? • An organisation can be managing quality without following the total quality approach. Such as, not inviting all employees, suppliers and customers to be involved in determining the levels of quality and the processes and resources to achieve that level of quality.

28. What is Quality? Individually Q. What recent experiences have you had regarding the quality of ‘products’? Q. What recent experiences have you had regarding the quality of ‘services’? Q. What did you learn about quality from these experiences?

29. What is Quality? Small Group Without opening your books, write a short definition of quality.

30. What is Quality? the transcendental approach “a condition of excellence implying fine quality as distinct from poor quality .... Quality is achieving or reaching for the highest standard as against being satisfied with the sloppy or the fraudulent.” the product‑based approach Quality is determined by the attributes of the product or service. the user based approach fitness for use as determined by the consumer or customer. the manufacturing‑based approach conformance to requirements value based approach “Quality is the degree of excellence at an acceptable price and the control of variability at an acceptable cost.”

31. Quality of Product • Does it do its job well? (Effectiveness) • Does it look good? (Presentation) • Is it trouble free? (Reliability) • Is it reasonably priced? (Cost)

32. Quality of Product Small Group Together choose a product with which you are familiar and describe the product in terms of: • Effectiveness • Presentation • Reliability • Cost

33. Quality of Service • Am I getting what I’m supposed to get? (Effectiveness) • Am I getting it in a way that appeals to me? (Presentation) • Am I getting it on time? (Reliability) • Are the fees reasonable? (Cost)

34. Quality of Product Small Group Together choose a service with which you are familiar and describe the service in terms of: • Effectiveness • Presentation • Reliability • Cost

35. Definition – Bank • Specification • Conformance • Reliability • Value • Delivery “Fully satisfying … agreed customer requirements … at the lowest internal cost.”

36. The Pioneers’ Definitions Hoyer and Hoyer (2001) provide the following definitions for quality from the pioneers of the quality movement: • Crosby states that “we must define quality as ‘conformance to requirements’ if we are to manage it”.

37. The Pioneers’ Definitions (continued) • Deming believes that: • Quality must be defined in terms of customer satisfaction. • Quality is multidimensional. • There are different degrees of quality. • Feigenbaum adds to Deming’s definition that quality is ‘dynamic’; and commends the importance of translating customer satisfaction into product characteristics.

38. The Pioneers’ Definitions (continued) • Ishikawa is interested in the principles of quality control and in quality assurance at the in-plant, practical level. • Ishikawa argues that: “Quality is equivalent to consumer satisfaction.” and that “the price of a product or service is an important part of its quality”.

39. The Pioneers’ Definitions (continued) • Juran sees that “a practical definition of quality is probably not possible”, and defines quality as “fitness for use”. • Hoyer and Hoyer (2001) see this as an ambiguous definition, but recognise that Juran “is not satisfied with efforts to integrate customer satisfaction with product characteristics”.

40. The Pioneers’ Definitions (continued) • Hoyer and Hoyer (2001) conclude that Walter A. Shewart’s definition is the best – from both an intellectual and a practical perspective. • Shewhart's essential points (from the 1920’s) are: • There are two sides to quality: subjective (what the customer wants) and objective (properties of the product). • An important dimension of quality is value received for the price paid. • Quality standards must be expressed in terms of physical, quantitatively measurable product characteristics. • Statistics must be used to take information about the individual product or service wants of a great many potential consumers and translate it into measurable characteristics of a specific product or service that will satisfy societal (marketplace) wants.

41. Misconceptions Misconception 1: Good quality is the same as high quality. Misconception 2: Quality management can be the responsibility of one department in an organisation. Misconception 3: Quality can be inspected into a product or service. Misconception 4: If a fault occurs in the production of a good or service, it is mostly the fault of workers.

42. Getting to Know the Pioneers Small Group Read about your ‘quality pioneer’ – prepare a brief presentation stating: • What the guru did for quality. • What principles the guru espoused.

43. Quality Pioneers • Deming’s 14 points. • Juran’s 10 steps and Quality Trilogy. • Crosby’s 4 absolutes of quality management. • Ishikawa’s fishbone diagram and 7 processes.

44. Six Sigma • A statistical measurement/project focussed approach to managing quality. • Statistically “six sigma means 3.4 defects per million”, where sigma “represent[s] the variation about the average of a process.” Anon (2003) • Described by Hensler and Klefsjo (2004) as “a methodology within the TQM framework and … not a substitute”.

45. Six Sigma (continued) • Anon (2003) discusses the critical importance of: • Management commitment • Culture change • Organisation infrastructure • Training and links to HR • Links to strategy, customers and suppliers • Anon (2003) also recognises the importance of project management skills and project prioritisation and selection to maximise benefits from Six Sigma.

46. Conclusion • Course Welcome and Introduction • Module Introduction • Terminology • Quality Management • Total Quality Management/Total Quality Approach • What is Quality? • Misconceptions About Quality Management • Quality Pioneers • Six Sigma

47. Next Week Week 2“Quality, Competitiveness and Globalisation” • Study Guide • Goetsch & Davis (2006)Chapter 2. Quality and Global Competitiveness • Electronic Journal Articles (on Proquest)

48. Questions?