What is Total Quality Management (TQM)?

1. What is Total Quality Management (TQM)? Total Quality Management - Spring 2010

2. TQM Total Made up of the whole Degree of excellence a product or service provides Quality Art of Planning, Organizing, Controlling etc. Management Therefore, TQM is the art of managing the whole to achieve excellence. Total Quality Management - Spring 2010

3. Meaning of TQM All persons System Of all divisions TQM means At every stratum MBO, Kaizen, QC Circle, 5S, TPM Method SQC,SPC, FMEA, MSA, OEE Q(Quality):Quality improvement C(Cost):Cost reduction D(Delivery):Delivery execution Purpose S(Safety):Safety maintenance M(Morale):Morale boosting E(Environmental):Environmental protection Total Quality Management - Spring 2010

4. Definition of TQM Systematic activities of operating the whole units of a company effectively and efficiently to supplygoods and services of quality satisfactory to customers at right time and at right price, thus contributing to attaining Business Purposes. TQM is integrated organisational approach in delighting customers (both internal and external) by meeting their expectations on a continuous basis through everyone involved in the organisation, working on continuous improvement in all products, services, and processes along with proper problem solving methodology. Total Quality Management - Spring 2010

5. Definition of TQM "TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organization and to society.” Total Quality Management means that the organization's culture is defined by and supports the constant attainment of customer satisfaction through an integrated system of tools, techniques, and training. This involves the continuous improvement of organizational processes, resulting in high quality products and services. Total Quality Management (TQM) is a management strategy aimed at embedding awareness of quality in all organizational processes. Total Quality Management - Spring 2010

6. What’s the goal of TQM? “Do the right things right the first time, every time.” Total Quality Management - Spring 2010

7. Pillars of TQM 1- Customer Focus: Studying customer needs, gathering customer requirements, and measuring and managing customer satisfaction. Customer satisfaction is seen as the company's highest priority. The company believes that it will only be successful if its customers are satisfied. 2- Process Management: Develop a production process that reduce the product variations. Applying the same process; the same product should be produces with the same level of quality every time. Teams are process-oriented, and interact with their internal customers to deliver the required results. Management's focus is on controlling the overall process, and rewarding teamwork. Total Quality Management - Spring 2010

8. Pillars of TQM 3- Employee Empowerment (Human side of Quality):TQM environment requires a committed and well-trained work force that participates fully in quality improvement activities. On-going education and training of all employees supports the drive for quality. 4- Continuous Improvement:TQM recognizes that product quality is the result of process quality. As a result, there is a focus on continuous improvement of the company's processes. This will lead to an improvement in process quality. In turn this will lead to an improvement in product quality. Measurement and analysis id the tool that has been used for that. Total Quality Management - Spring 2010

9. T. Q. M. Customer Focus Process Management Employee Training & Empowerment Continuous Improvement (through measurement and analysis) Pillars of TQM • Reduce rework activities (Cost reduction) • Shorter development cycle (Cost reduction) • Increased customer satisfaction (Quality improvement) Total Quality Management - Spring 2010

10. TQM 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. Total Quality Management - Spring 2010

11. (1) total client satisfaction through quality products and services; and (2) continuous improvements to processes, systems, people, suppliers, partners, products, and services. Another way to put it • At it’s simplest, TQM is all managers leading and facilitating all contributors in everyone’s two main objectives: Total Quality Management - Spring 2010

12. Continuous Improvement versus Traditional Approach • Market-share focus • Individuals • Focus on ‘who” and “why” • Short-term focus • Status quo focus • Product focus • Innovation • Fire fighting • Customer focus • Cross-functional teams • Focus on “what” and “how” • Long-term focus • Continuous improvement • Process improvement focus • Incremental improvements • Problem solving Continuous Improvement Traditional Approach Total Quality Management - Spring 2010

13. Approach Management Led Scope Company Wide Scale Everyone is responsible for Quality Philosophy Prevention not Detection Standard Right First Time Control Cost of Quality Theme On going Improvement BASIC PRINCIPLES/APPROACHES OF TQM Total Quality Management - Spring 2010

14. Understanding and building the quality chains • “A Customer’s impression of quality begins with the initial contact with the company and continues through the life of the product.” • Customers look to the total package - sales, service during the sale, packaging, deliver, and service after the sale. • Quality extends to how the receptionist answers the phone, how managers treat subordinates, how courteous sales and repair people are, and how the product is serviced after the sale. • “All departments of the company must strive to improve the quality of their operations.” Total Quality Management - Spring 2010

15. Understanding and building the quality chains • Meeting the customer requirements within the organization. • Failure (QC manager and others) • Failure not doing it right the first time at every stage of the process. • Throughout and beyond all organizations -manufacturing & service- there is a series of quality chains of customer and supplier. • Quality chains may be broken at any point, customer not satisfied. Total Quality Management - Spring 2010

16. Understanding and building the quality chains • To achieve quality throughout an organization, each person in the quality chain must interrogate every interface as follows: Customers: who are my immediate customers? what are their true requirements? how can I measure my ability to meet the requirements? Suppliers: who are my immediate suppliers? what are my true requirements? Total Quality Management - Spring 2010

17. Understanding and building the quality chains • The concept of internal and external customers/suppliers forms the core of total quality. • Quality has to be managed – it will not just happen. • Failure to meet the requirements in any part of quality chain leads to yet more failure. • The price of quality is the continual examination of the requirements and our ability to meet them “continuing improvement” philosophy. Total Quality Management - Spring 2010

18. Customer types • External and Internal customers • External – current, prospective and lost customers • Internal – Every person in a process is a customer of the previous operation.( applies to design, manufacturing, sales, supplies etc.) [Each worker should see that the quality meets expectations of the next person in the supplier-to-customer chain ] • TQM is commitment to customer-focus - internal and external customers. Total Quality Management - Spring 2010

19. Customer/supplier chain Outputs to external customers Inputs from external customers Internal customers Total Quality Management - Spring 2010

20. Internal customer/Supplier relationships • Questions asked by people to their internal customers • What do you need from me? • What do you do with my output? • Are there any gaps between what you need and what you get? • Good team-work and inter-Departmental harmony is required. Also the leaders role in supervising the internal customer-supplier chain. Total Quality Management - Spring 2010

21. Improvements Improvements External Suppliers Internal Suppliers Internal Suppliers External Customer Requirements Requirements Internal\External Customers Total Quality Management - Spring 2010

22. Understanding and building the quality chains • Meeting the requirements • the first item on the list of things to do is find out what requirements are. • If we are dealing with a customer/supplier relationship, the supplier must understand not only the needs of the customer but also the ability of his own organization to meet them. • Internal supplier/customer relationships are often the most difficult to manage in terms of establishing the requirements. Total Quality Management - Spring 2010

23. 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. Total Quality Management - Spring 2010

24. Customer Satisfaction Organizational Diagram CUSTOMERS Front-line Staff Functional Department Staff Sr. Mgrs CEO Total Quality Management - Spring 2010

25. 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? Total Quality Management - Spring 2010

26. Integrated Quality Customer Customer Requirements Selling Price Customer Schedule Quality Cost Delivery Process Capability Production Cost Process Speed Supplier Total Quality Management - Spring 2010

27. Understanding and building the quality chains • To understand how quality may be built into a product or service, at any stage, it is necessary to examine the three distinct, but interrelated aspects/parameters of quality: • Quality of Design • Quality of Conformance • Quality of Use Total Quality Management - Spring 2010

28. Understanding and building the quality chains Quality of Design: Is the extent to which the design reflects a products or service that satisfies the customer need or expectations. • TV chair example • Quality of design is a measure of how well the product or service is designed to achieve the agreed requirements. • The most important feature of the design, with regard to achieving quality, is the specification. • Specifications must also exist at the internal supplier/customer interfaces. • There must be an agreement that the operating departments can achieve that requirement. Total Quality Management - Spring 2010

29. Understanding and building the quality chains • Quality of conformance to design: Is the extent to which the product or service conforms to the design standard • What the customer actually receives should conform to the design. • The conformance check makes sure that things go according to plan. • Organizations may use the simple matrix to assess how much time spent doing the right things right. Things we do Right Wrong X Right The way we do them X ? Wrong Total Quality Management - Spring 2010

30. Understanding and building the quality chains Quality of Use Is the extent to which a product is easy to use, reliable and maintainable. Total Quality Management - Spring 2010

31. How Work Gets Done in an Organization? • Inputs Delivered by suppliers • Processes Steps to transform inputs • Outputs Goods and Services valued by customers Quality of outputs depends on the correct execution of FIRST two steps. A mistake anywhere in the process affects everyone in one way to another. Total Quality Management - Spring 2010

32. Managing processes • Have we done the job correctly? • This is not quality control, it is detection. • This process –detection- happens at the end of the processes. • Are we capable of doing the job correctly? • We should realize that an answer will only be obtained by means of satisfactory methods, materials, equipment, skills and instruction, and a satisfactory ‘process’. Total Quality Management - Spring 2010

33. Managing processes • What is a process? • A process is the transformation of a set of inputs, which can include actions, methods and operations, into outputs that satisfy customer needs and expectations, in the form of products, information, services or –generally- results. • To produce an output meets the requirements, it is necessary to define, monitor and control the inputs to the process. • Every single task throughout an organization must be viewed as a process. Total Quality Management - Spring 2010

34. Managing processes Process Materials S U P P L I E R S C U S T O M E R S Product Procedures Methods Service Information People Information Skills Knowledge Paperwork Training Total Quality Management - Spring 2010 Equipment

35. Managing processes • If our process is capable of meeting the requirements, “Do we continue to do the job correctly?”, this needs to monitor and control the process. Have we done the job correctly? Are we capable of doing the job correctly? Do we continue to do the job correctly? Detection Prevention Total Quality Management - Spring 2010

36. Managing processes • Quality control • The activities and techniques employed to achieve and maintain the quality of a product, process, or service. • A set of activities designed to evaluate a developed work product. • It is concerned with finding and eliminating causes of quality problem. • Finding defects in specific deliverables. • It is product – oriented. • Focuses on employed activities and techniques. • Examples (testing, monitoring, ….) Total Quality Management - Spring 2010

37. Managing processes • Quality assurance • The prevention of quality problems through planned and systematic activities (including documentation). • A set of activities designed to ensure that the development and/or maintenance process is adequate to ensure a system will meet its objectives. • Ensure that the process is defined and appropriate. • Process-oriented. • Aims at preventing quality problems. • Examples (development of methodology & standards, establishment of QMS, …..) Total Quality Management - Spring 2010

38. Quality starts with ‘Marketing’ • Marketing is responsible for determining the key characteristics that determine the suitability of the product or service in the eyes of the customer. • Excellent communication between customers and suppliers is the key to total quality. • Requirements must be communicated properly throughout the organization in the form of specifications which can be used as the basis for the design . Total Quality Management - Spring 2010

39. Quality starts with ‘Marketing’ • The information requirements include: • Characteristics of performance & reliability • Aesthetic characteristics • Any obligatory regulations or standards governing the nature of the product or service • Marketing must also establish systems for feedback of customer information and reaction, and these systems should be designed on a continuous monitoring. Total Quality Management - Spring 2010

40. Quality starts with ‘Marketing’ • In reviewing of market readiness of a new product or service. Items that require some attention include assessment of: • The suitability of the distribution & customer-service system • training of personnel in the field • Availability of spare parts or staff support • Evidence that the organization is capable of meeting customer requirements Total Quality Management - Spring 2010

41. User purchase perceptions- from survey • Performance • Features • Service • Warranty • Price • Reputation ( refer pgs.72 and 73, Besterfield) Total Quality Management - Spring 2010

42. 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 Mfgr. • 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. Total Quality Management - Spring 2010

43. 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. Total Quality Management - Spring 2010

44. Customers- Handle with care! • Employers don’t pay wages but it is the customer who pays the wages! • So take good care of your customers. • Customer-care centers not just profit-centers! • The entire organization must in effect revolve around the customer – whether the customer is being well served and if he is really pleased, contented and satisfied with the service you have to offer. Total Quality Management - Spring 2010

45. Quality in all functions • For an organization to be truly effective, each part of it must work properly together. • Errors have a way of multiplying. • Business employs so many different specialist skills that everyone has to rely on the activities of others in doing their jobs. • The commitment of all members of an organization is a requirement of ‘company-wide quality improvement’. Total Quality Management - Spring 2010

46. Effects of poor Quality • 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 Total Quality Management - Spring 2010

47. Benefits of Quality • 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. Total Quality Management - Spring 2010

48. Summary Slide • The following Slides are for understanding only (subject to indirect Questions): “ 26,27,28,29,36,45,54,56,57,58,59,74,75,76,77” • Other slides are required and subjects to any type of Questions Total Quality Management - Spring 2010