Total Quality Management (TQM). Book Name: Total Quality Management (2 nd Edition) Author: Joel E. Ross Chapter Chapter Heading 1 Introduction to Total Quality Management 2 Leadership for TQM
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Total Quality Management (TQM) Book Name: Total Quality Management (2nd Edition) Author: Joel E. Ross ChapterChapter Heading 1 Introduction to Total Quality Management 2 Leadership for TQM 3 Information Analysis and Information Technology 4 Strategic Quality Planning 5 Human Resource Development and Management 6 Management of Processing Quality 7 Customer Focus and Satisfaction 8 Benchmarking 9 Organization for TQM; Structure and Teams 10 Productivity, Quality, and Reengineering 11 The Cost of Quality 12 ISO 9000: Universal Standards of Quality
Total Quality Management (TQM) CHAPTER 1 Introduction to Total Quality Management
Total Quality Management (TQM) What is Quality ?
Quality means different to different people: 1. Customer-Based:Fitness for use, meeting customer expectations. 2.Manufacturing-Based:Conforming to design, specifications, or requirements. Having no defects. 3. Product-Based: The product has something that other similar products do not that adds value. 4. Value-Based:The product is the best combination of price and features. 5. Transcendent: It is not clear what it is, but it is something good... Definitions of Quality
Total Quality Management (TQM) Quality means different to different people. There are five ways of looking at quality definitions I. Transcendent Definition: "Quality is neither mind nor matter, but a third entity independent of the two…even through Quality cannot be defined, you know what it is." II. Product-Based Definition: "Quality refers to the amounts of the unpriced attributes contained in each unit of the priced attribute." III. User-Based Definition: "Quality is fitness for use." (J.M. Juran, ed., Quality Control Handbook, p2). IV. Manufacturing-Based Definition: "Quality [means] conformance to requirements." "Quality is the degree to which a specific product conforms to a design or specification." V. Value-Based Definition: "Quality means best for certain customer conditions. These conditions are (a) the actual use and (b) the selling price of the product."
What is TQM? • TQM is the enhancement to the traditional way of doing business. • It is a proven technique to guarantee survival in the world-class competition. • TQM is for the most part common sense. • Analyzing three words (TQM), we have: Total—Made up of the whole Quality—Degree of excellence a product or service provides Management—Act, art, or manner of handling, controlling, directing, etc. • Therefore TQM is the art of managing the whole to achieve the excellence.
What is TQM? (Continued) • TQM is defined as both philosophy and a set of guiding principles that represents the foundation of a continuously improving organization. • It is the application of quantitative methods and human resources to improve all the processes within an organization and exceed customer needs now and in future. • TQM integrates fundamental management techniques, existing improvement efforts, and technical tools under disciplined approach.
Total Quality Management (TQM) In trying to define TQM is it is well worth considering the relevance and meaning of the three words in it's title.: Total - The responsibility for achieving Quality rests with everyone a business no matter what their function. It recognizes the necessity to develop processes across the business, that together lead to the reliable delivery of exact, agreed customer requirements. This will achieve the most competitive cost position and a higher return on investment. Quality - The prime task of any business is to understand the needs of the customer, then deliver the product or service at the agreed time, place and price, on every occasion. This will retain current customers, assist in acquiring new ones and lead to a subsequent increase in market share. Management - Top management lead the drive to achieve quality for customers, by communicating the business vision and values to all employees; ensuring the right business processes are in place; introducing and maintaining a continuous improvement culture.
Total Quality Management (TQM) Antecedents of Modern Quality Management • Guilds of Medieval Europe (From the end of 13th Century to Early 19th Century) • The Industrial Revolution (From the end of 17th Century to 1800s) • The World War II (From 1938 to 1945) • Post World War Era (After 1945)
Total Quality Management (TQM) Guilds of Medieval Europe (From the end of 13th Century to Early 19th Century)
Total Quality Management (TQM) Guilds of Medieval Europe (From the end of 13th Century to Early 19th Century)
Total Quality Management (TQM) Antecedents of Modern Quality Management The Industrial Revolution (From the end of 17th Century to 1800s) • Craftsmanship • The Factory System • The Taylor System
Total Quality Management (TQM) Industrial Revolution: The Craftsmanship
Total Quality Management (TQM) World War II
Total Quality Management (TQM) Post World War II The Birth of Total Quality Management The birth of the Total Quality Control in US was in direct response to a quality revolution in Japan following WW-II as Japanese manufacturers converted from Producing Military Goods for internal use to producing civilian goods for trade. At first Japan had a widely held reputation for shoddy exports, and their goods were shunned by international markets. This led Japanese organizations to explore new ways of thinking about quality. And from here starts the era of “Quality Gurus”!
Total Quality Management (TQM) What is a quality guru? • A guru, by definition, is a good person, a wise person and a teacher. • A quality guru should be all of these, plus have a concept and approach to quality within business that has made a major and lasting impact. • These gurus have done, and continue to do, that, in some cases, even after their death.
The Era of Quality Gurus There have been three groups of gurus since the 1940’s: 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
Total Quality Management (TQM) The Americans who went to Japan: J. Edward Deming Armand V Feigenbaum Joseph M. Juran
Total Quality Management (TQM) Joseph Juran Juran is a founder of the Juran Institute in Wilton, Connecticut. He promoted the concept known as Business Process Quality, which is a technique of Cross-Functional Quality Improvement. He was invited to Japan in 1954 by the Union of Japanese Scientists and Engineers (JUSE) He predicted the quality of Japanese goods would overtake the quality of goods produced in US by Mid-1970s because of Japan’s revolutionary rate of quality improvement
Total Quality Management (TQM) W. Edward Deming Deming, who had become frustrated with American managers when most programs of statistical quality control were terminated once the war and government contracts came to an end, was invited to Japan in 1954 by the Union of Japanese Scientists and Engineers (JUSE). Deming was the main figure in popularizing quality control in Japan and regarded as national hero in that country. He believes that quality must be built I into the product at all stages in order to achieve a high level of excellence. His thoughts were highly influenced by Walter Shwartz who was the proponent of Statistical Quality Control (SQC). He views statistics as a management tool and relies on statistical process control as means in managing variations in a process.
Total Quality Management (TQM) W Edwards Deming placed great importance and responsibility on management, at both the individual and company level, believing management to be responsible for 94% of quality problems. His fourteen point plan is a complete philosophy of management, that can be applied to small or large organizations in the public, private or service sectors: • Create constancy of purpose towards improvement of product and service • Adopt the new philosophy. We can no longer live with commonly accepted levels of delay, mistakes and defective workmanship • Cease dependence on mass inspection. Instead, require statistical evidence that quality is built in • End the practice of awarding business on the basis of price • Find problems. It is management’s job to work continually on the system • Institute modern methods of training on the job • Institute modern methods of supervision of production workers, The responsibility of foremen must be changed from numbers to quality • Drive out fear, so that everyone may work effectively for the company • Break down barriers between departments • Eliminate numerical goals, posters and slogans for the workforce asking for new levels of productivity without providing methods • Eliminate work standards that prescribe numerical quotas • Remove barriers that stand between the hourly worker and their right to pride of workmanship • Institute a vigorous program of education and retraining • Create a structure in top management that will push on the above points every day
Total Quality Management (TQM) Armand V Feigenbaumwas the originator of “total quality control”, often referred to as total quality. He defined it as: “An effective system for integrating quality development, quality maintenance and quality improvement efforts of the various groups within an organization, so as to enable production and service at the most economical levels that allow full customer satisfaction”. He saw it as a business method and proposed three steps to quality: • Quality leadership • Modern quality technology • Organisational commitment
Total Quality Management (TQM) Japanese who developed new concepts in response to the Americans Dr Kaoru Ishikawa Dr Genichi Taguchi Shigeo Shingo
Dr Kaoru Ishikawa made many contributions to quality, the most noteworthy being his total quality viewpoint, company wide quality control, his emphasis on the human side of quality, the Ishikawa diagram and the assembly and use of the “seven basic tools of quality”: • 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?
Total Quality Management (TQM) Ishikawa Diagram (Cause & Effects Diagram) Also known as Fishbone Analysis
Total Quality Management (TQM) Shigeo Shingo Shingo is strongly associated with Just-in-Time manufacturing, and was the inventor of the single minute exchange of die (SMED) system, in which set up times are reduced from hours to minutes, and the Poka-Yoke (mistake proofing) system. In Poka Yoke, defects are examined, the production system stopped and immediate feedback given so that the root causes of the problem may be identified and prevented from occurring again.
Total Quality Management (TQM) Poka Yoke: Fail Safe/Mistake Proofing System
Total Quality Management (TQM) Dr Genichi Taguchi Taguchibelieved it is preferable to design product that is robust or insensitive to variation in the manufacturing process, rather than attempt to control all the many variations during actual manufacture. “Taguchi methodology” is fundamentally a prototyping method that enables the designer to identify the optimal settings to produce a robust product that can survive manufacturing time after time, piece after piece, and provide what the customer wants.
Total Quality Management (TQM) Western gurus who followed the Japanese industrial success Philip B Crosby Tom Peters
Total Quality Management (TQM) Philip B Crosby Crosby is known for the concepts of “Quality is Free” and “Zero Defects”, and his quality improvement process is based on his four absolutes of quality: • Quality is conformance to requirements • The system of quality is prevention • The performance standard is zero defect • The measurement of quality is the price of non-conformance
Total Quality Management (TQM) Tom Peters Tom Peters identified leadership as being central to the quality improvement process, discarding the word “Management” for “Leadership”. The new role is of a facilitator, and the basis is “Managing by walking about” (MBWA), enabling the leader to keep in touch with customers, innovation and people, the three main areas in the pursuit of excellence. He believes that, as the effective leader walks, at least 3 major activities are happening: • Listening suggests caring • Teaching values are transmitted • Facilitating able to give on-the-spot help
The Trends Accelerating Use of TQM: 1970s the era of Hue & Cry! “If Japan Can… Why Can’t We?” • At first U.S. manufacturers held onto to their assumption that Japanese success was price-related, and thus responded to Japanese competition with strategies aimed at reducing domestic production costs and restricting imports. • This, of course, did nothing to improve American competitiveness in quality. • As years passed, price competition declined while quality competition continued to increase. • By the end of the 1970s, the American quality crisis reached major proportions, attracting attention from national legislators, administrators and the media. • A 1980 NBC-TV News special report, “If Japan Can… Why Can’t We?” highlighted how Japan had captured the world auto and electronics markets. Finally, U.S. organizations began to listen.
The American Response The US Business Community Wakes up in 1980s from Deep Slumber • The chief executive officers of major U.S. corporations stepped forward to provide personal leadership in the quality movement. • The U.S. response, emphasizing not only statistics but approaches that embraced the entire organization, became known as Total Quality Management (TQM). • Several other quality initiatives followed. The ISO 9000 series of quality-management standards, for example, were published in 1987.
Total Quality Management (TQM) The American Response The USBusiness Community Wakes up in 1980s from Deep Slumber Several other quality initiatives followed. The ISO 9000 series of quality-management standards, for example, were published in 1987. The Baldrige National Quality Program and Malcolm Baldrige National Quality Award were established by the U.S. Congress the same year. American companies were at first slow to adopt the standards but eventually came on board. • The major rationale behind establishment of this law was intense foreign competition especially from Japan. • The award has set a national standard for quality, and hundreds of major corporations used the criteria in application form as a basic management guide for quality improvement programs. • Meeting criteria is not an easy matter. A perfect score is 1000
Baldrige Award Points Scale Examination Categories/Items _____ Point Values 1.0 Leadership95 1.1 Senior Executive Leadership 45 1.2 Management for quality 25 1.3 Public Responsibility and corporate citizenship 25 2.0 Information and Analysis75 2.1 Scope and management of quality and performance data 15 information. 2.2 Competitive comparisons and benchmarking 20 2.3 Analysis and uses of company-level data 40 3.0 Strategic Quality Planning60 3.1 Strategic quality and company performance planning process 35 3.2 Quality performance plans 25
Total Quality Management (TQM) Examination Categories/Items Point Values 4.0 Human Resource Development and Management 150 4.1 Human resource planning and management 20 4.2 Employee involvement 40 4.3 Employee education and training 40 4.4 Employee performance and recognition 25 4.5 Employee well-being and satisfaction 25 5.0 Management of Process Quality 140 5.1 Design and introduction of quality products and services 40 5.2 Process management: product and service production and 35 delivery processes 5.3 Process management: business processes and support services 30 5.4 Supplier quality 20 5.5 Quality assessment 15
Total Quality Management (TQM) Examination Categories/Items Point Values 6.0 Quality and Operational Results 180 6.1 Product and service quality results 70 6.2 Company operational results 50 6.3 Business process and support service results 25 6.4 Supplier quality results 35 7.0 Customer Focus and Satisfaction 300 7.1 Customer expectation: current and future 35 7.2 Customer relationship management 65 7.3 Commitment to customer 15 7.4 Customer satisfaction determination 30 7.5 Customer satisfaction results 85 7.6 Customer satisfaction comparison 70
Total Quality Management (TQM) Why Apply for Baldrige Award? We applied for the Award, not with the idea of winning, but with the goal of receiving the evaluation of the Baldrige Examiners. That evaluation was comprehensive, professional, and insightful...making it perhaps the most cost-effective, value-added business consultation available anywhere in the world today. Bob Barnett Executive Vice President Motorola, Inc. 2003 Baldrige Award Ceremony
Total Quality Management (TQM) Some Visuals of the Coveted Baldrige National Quality Awards
Total Quality Management (TQM) Winners of Baldrige National Quality Awards
Total Quality Management (TQM) Winners of Baldrige National Quality Awards
Total Quality Management (TQM) Chief Guest Speaking During National Quality AwardsCeremony
Total Quality Management (TQM) Some Visuals of Baldrige National Quality Awards
Total Quality Management (TQM) TQM Beyond 2000 As the 21st century begins, the quality movement has matured. The new quality systems have evolved beyond the foundations laid by Deming, Juran and the early Japanese practitioners of quality • In 2000 the ISO 9000 series of quality management standards was revised to increase emphasis on customer satisfaction. Sector-specific versions of the ISO 9000 series of quality management standards were developed for such industries as automotive (QS-9000), aerospace (AS9000) and telecommunications (TL 9000 and ISO/TS 16949) and for environmental management (ISO 14000). • Six Sigma, a methodology developed by Motorola to improve its business processes by minimizing defects, evolved into an organizational approach that achieved breakthroughs – and significant bottom-line results. When Motorola received a Baldrige Award in 1988, it shared its quality practices, like Toyota Motor Corporation, with others.
Total Quality Management (TQM) • Quality function deployment was developed by Yoji Akao as a process for focusing on customer wants or needs in the design or redesign of a product or service. • Quality has moved beyond the manufacturing sector into such areas service, healthcare, education and government. • The Malcom Baldridge National Quality Award has added education and healthcare to its original categories: manufacturing, small business and service. Many advocates are pressing for the adoption of a “nonprofit organization” category as well.
Total Quality Management (TQM) END OF CHAPTER 1