SATYA TQM Page 14.03 Total Quality ManagementMODULE 1IntroductionTQM is a management approach for an organization, centered on quality, based on theparticipation 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 (TQM) is a management strategy aimed at embedding awareness ofquality in all organizational processesDefinition of quality The concept and vocabulary of quality are elusive. Different peopleinterpret quality differently. Few can define quality in measurable terms that can be provedoperational zed. When asked what differentiates their product or service;The banker will answer‖ service‖The healthcare worker will answer ―quality health care‖The hotel employee will answer ―customer satisfaction‖The manufacturer will simply answer ―quality product‖Dimensions of quality,Product- TVPerformance - Primary Characteristics, such as brightnessFeatures –Secondary Characteristics, Remote ControlConformance-Meeting Specifications or StandardsReliability –Consistency of Performance over time-failDurability- Useful life includes Repair.Service-Resolution of problems, ease of repairResponse- Human relations with CustomersAesthetics-Sensory FeaturesReputation- Past performance, Company Image
SATYA TQM Page 2Inspection,• Definition: It is defined as a function whose purposes are to interpret specifications,verify conformance to these specifications and communicate the information obtained tothose responsible for making necessary corrections in the manufacturing process• Inspection is verification of conformance of goods or services to the design specifications• Inspection is a postmortem operation carried out after the product is manufactured• Inspection segregates well from the bad and defective items may be either rectified orscrapped and ensures that defective items are not sent to further stages of manufactureInspection does not add to the value or quality of the product. It only ensures thatsubstandard products are not supplied to the customer• Quality control helps to minimize the costs of inspection and rejection• and finished products with defects are not sold to customersQuality control,• Quality control refers to all those functions or activities that must be performed to fill thecompany‘s quality objectives• Inspection is one phase of quality control. It provides information required by otherphases of quality control• Quality control includes establishment of criteria for the selection of productionequipment, tooling and personnel. It often involves statistical analysis(SQC)• QC aims at investigating the root cause for defects identified by inspection and takecorrective action to overcome the defects for future production• Defects may be because of due to defective design, defective machine or defectiveworkmanship• QC is an effective system for integrating the quality development, quality maintenanceand quality improvement
SATYA TQM Page 3Quality assurance,• It is the sum total of all lab activities that are undertaken to ensure generation of accurateand reliable results.• What is the Objective?To ensure credibility of the lab and generate confidence in lab resultsQuality management,TOTAL QUALITY MANAGEMENT is a thought revolution in management where the entirebusiness is operated with customer orientation in all activities all the time by everyone in theorganization.TQM is an integrated system and methodology throughout the organization that helps to design,produce and service quality products or services which are most economical for their value, mostuseful and always satisfactory to the customerBenefits of TQM, Improved Quality Employee Participation Team Work Internal & External Customer Satisfaction Productivity ,Communication Profitability & Market Share Greater customer loyalty Market share improvement Higher stock prices Reduced service calls Higher prices Greater productivity
SATYA TQM Page 4Concept of Big QOld quality is small q New quality is Big QAbout products About organizationsTechnical StrategicFor inspectors For everyoneLed by experts Led by managementHigh grade Appropriate gradeAbout control About improvementFMEAFailure modes and effects analysis (FMEA) is a step-by-step approach for identifying all possiblefailures in a design, a manufacturing or assembly process, or a product or service.―Failure modes‖ means the ways, or modes, in which something might fail. Failures are anyerrors or defects, especially ones that affect the customer, and can be potential or actual.―Effects analysis‖ refers to studying the consequences of those failures.Failures are prioritized according to how serious their consequences are, how frequently theyoccur and how easily they can be detected. The purpose of the FMEA is to take actions toeliminate or reduce failures, starting with the highest-priority ones.Failure modes and effects analysis also documents current knowledge and actions about the risksof failures, for use in continuous improvement. FMEA is used during design to prevent failures.Later it‘s used for control, before and during ongoing operation of the process. Ideally, FMEAbegins during the earliest conceptual stages of design and continues throughout the life of theproduct or service.Begun in the 1940s by the U.S. military, FMEA was further developed by the aerospace andautomotive industries. Several industries maintain formal FMEA standards.
SATYA TQM Page 5What follows is an overview and reference. Before undertaking an FMEA process, learn moreabout standards and specific methods in your organization and industry through other referencesand training.MODULE 2Deming PDCA cycle,• Plan – Study the current system; identifying problems; testing theories of causes; anddeveloping solutions.• Do – Plan is implemented on a trial basis. Data collected and documented.• Study – Determine whether the trial plan is working correctly by evaluating the results.• Act – Improvements are standardized and final plan is implemented.Deming 14 point philosophy,1. Create and publish to all employees a statement of the aims and purposes of thecompany. The management must demonstrate their commitment to this statement.
SATYA TQM Page 62. Learn the new philosophy.3. Understand the purpose of inspection – to reduce the cost and improve the processes.4. End the practice of awarding business on the basis of price tag alone.5. Improve constantly and forever the system of production and service.6. Institute training7. Teach and institute leadership.8. Drive out fear. Create an environment of innovation.9. Optimize the team efforts towards the aims and purposes of the company.10. Eliminate exhortations for the workforce.11. Eliminate numerical quotas for production.12. Remove the barriers that rob pride of workmanship.13. Encourage learning and self-improvement.14. Take action to accomplish the transformationJuran quality trilogy,1. Quality planning: Process of preparing to meet quality goals. Involves understandingcustomer needs and developing product features.2. Quality control: Process of meeting quality goals during operations. Control parameters.Measuring the deviation and taking action.3. Quality improvement: Process for breaking through to unprecedented levels ofperformance. Identify areas of improvement and get the right people to bring about thechange.Phil Crosby 14 point philosophy,1 Management Commitment for Process Improvement .Top management must communicate ithas a zero defect strategy if it wants a quality improvment process. The primary action to
SATYA TQM Page 7accomplish this is to write and communicate a Quality Policy. In ISO 9001 all documentationcomes from the philosophy in the quality policy. This is the reason why that is so important.2 Quality Improvement Team to Create Process Improvement3 Measurement of Process Improvement4 Costs of Quality and Process Improvement5 Quality Awareness as it relates to Process Improvement6 Corrective Actions for Process Improvement7 Zero Defects Planning and Zero Defects Day impact on Process Improvement8 Employee Educations Creates Process Improvement9 Goals Setting for Process Improvement10 Error Cause Removals in Process Improvement11 Recognition of Process Improvement Efforts12 Quality Councils for Process Improvement13 Do It All Over Again for Continuous Process ImprovementCrosby’s concept quality is free,Quality is free. Its not a gift, but it is free. What costs money are the inequality things - all theactions that involve not doing jobs right the first time.""Quality is not only free, it is an honest-to-everything profit maker. Every penny you dont spendon doing things wrong, over, or instead becomes half a penny right on the bottom line. In thesedays of who knows what is going to happen to our business tomorrow there arent many waysleft to make a profit improvement. If you concentrate on making quality certain, you canprobably increase your profit by an amount equal to 5 to 10 percent of your sales. That is a lot ofmoney for free."In the 1980‘s, Philip Crosby came up with the Four Absolutes of Quality. We have used the FourAbsolutes as the foundation for planning sessions, key decision-making and processimprovement. I‘m not a big fan of how Dr. Crosby originally wrote his Absolutes, so I‘llparaphrase:
SATYA TQM Page 8• Conform to client‘s expectations• Prevention, not appraisal• Zero defects• Know the price of non-conformance• Our clients have expectations on how we represent them to their customers. They outlinethe dos and don‘ts and we train, educate and manage to those standards. The key to a goodcustomer experience is following ridged guidelines, but still sound like a human, not a robot.• My favorite is prevention, not appraisal. We say the most important person in ourorganization is the CMR, because they are the one that faces our clients‘ customer. The mostinfluential position in our company is their supervisor who spends the majority of their timemanaging our people and process to PREVENT any problems. The popular principle for thisprocess is ―do it right the first time.‖• Zero defects can be a lofty goal for any organization, especially a service business likeGCS. When you‘re dealing with human behavior, perfection is not always realistic. We still wantto expect perfection and be confident everyone knows what perfection looks and feels like.• The Price of non-conformance is a negative way of monetizing quality. I‘d rather look atthe Value of conformance. In our business, we are rewarded for results. We are penalized forquality breeches. The rewards come in the form of more business and new programs. Thepenalties come in the form of process changes, fines and ultimately lost business. Our clientsessentially have a zero tolerance stance on quality breeches. If we miss-represent their productsor show disrespect to their customers, the cost is disproportionally high. Yes, one bad apple canspoil the bunch. One bad sale or conversational meltdown can lose an entire program. We‘veseen it happen to us and to our competitors.Genichi Taguche’sconcept of customer tolerance limits,Introduction to the Taguchi MethodsAccording to Taguchi‘s Quality Engineering Handbook (Wiley-Interscience, 2004), Taguchi‘smethod differs from what the United States terms ―quality engineering.‖ His method, variouslyknown as ―the Taguchi method,‖ ―the Taguchi paradigm‖ or ―Taguchi quality engineering‖ inboth Europe and the United States, is ―robust engineering based on the following threeprocedures: (1) orthogonal array, (2) SN ratio, and (3) loss function‖Taguchi‘s DOE methodology has inspired many DOE practitioners who use his methodology,and much discussion and controversy regarding it. Some writers, such as Ranjit K. Roy in
SATYA TQM Page 9Design of Experiments Using the Taguchi Approach (Wiley-Interscience, 2001) and theAmerican Supplier Institute‘s James O. Wilkins Jr. report successes using Taguchi‘s DOEmethodology; others, such as George E. P. Box,Søren Bisgaard, and Dorian Shainin and PeterShainin, take a more critical view.Taguchi‘s design of experiments (DOE) uses orthogonal arrays. In DOE, ―orthogonal‖ means thecolumns of arrays are balanced, and ―balanced‖ means the number of levels in the columns areequal. Balancing ensures that there are an equal number of all possible combinations of factors.The signal-to-noise (SN) ratio is a key element of analyzing DOE conducted using Taguchi‘sorthogonal arrays. The SN ratio is the reciprocal of the variance of the measurement error, and ituses the logarithm of the standard deviation to separate dispersion and location effects in DOE.This is in contrast to other methods of DOE that use the more conventional analysis of variance(ANOVA) for analyzing experimental results.Taguchi‘s loss function can be illustrated with the example of a low-quality automotivecomponent (see figure 1). The component may be produced within specification, but with a largestandard deviation that will result in some customers receiving good parts, and other customersreceiving parts that will present a problem. Those customers with a problem will need to take thetime to bring their vehicles to a dealer. The dealer will need to have a large staff of mechanics ifmany vehicles are returned due to problematic components. The dealer loses money byemploying a staff dedicated to fixing problems that could have been prevented, and society as awhole experiences a loss when many people miss work to take their vehicles to a dealer forrepairs. Taguchi‘s solution is to design quality into a product as early as possible during theengineering phase.Figure 1: The Taguchi loss function
SATYA TQM Page 10According to Genichi Taguchi, Subir Chowdhury, and Shin Taguchi in Robust Engineering(McGraw-Hill Professional, 1999), robustness is ―the state where the technology, product, orprocess performance is minimally sensitive to factors causing variability (either in themanufacturing or user‘s environment) and aging at the lowest unit manufacturing cost.‖ Robustcomponents minimize the loss in the loss function because the process is at the center of thecurve in the Taguchi loss function.Taguchi quality loss function,IntroductionGenichi Taguchi provided a whole new way to evaluate the quality of a product. Traditionally, productquality has been a correlation between loss and market size for the product. Actual quality of the productwas thought of as an adherence to product specifications. Loss due to quality has usually only beenthought of as additional costs in manufacturing (i.e. materials, re-tooling, etc.) to the producer up to thetime of shipment or sale of the product. It was believed that after sale of the product, the consumer wasthe one to bear costs due to quality loss either in repairs or the purchase of a new product. It has actuallybeen proven in most cases that in the end the manufacturer is the one to bear the costs of quality loss dueto things like negative feedback from customers. Taguchi changed the perspective of quality bycorrelating quality with cost and loss in dollars not only at the manufacturing level, but also to thecustomer and society in general.Taguchi Quality Loss FunctionYou will most likely encounter Taguchi methods in a manufacturing context. They are statisticalmethods developed by Genichi Taguchi to improve the quality of products. Whereas statisticiansbefore him focused on improving the mean outcome of a process, Taguchi recognized that in anindustrial process it is vital to produce a product on target , and that the variation around themean caused poor manufactured quality. For example, car windshields that have the targetaverage mean are useless if they each vary significantly from the target specifications.What are the losses to society from poor quality?Taguchis key argument was that the cost of poor quality goes beyond direct costs to themanufacturer such as reworking or waste costs. Traditionally manufacturers have consideredonly the costs of quality up to the point of shipping out the product. Taguchi aims to quantifycosts over the lifetime of the product. Long term costs to the manufacturer would include brandreputation and loss of customer satisfaction leading to declining market share. Other costs to theconsumer would include costs from low durability, difficulty interfacing with other parts, or theneed to build in safety margins.Great, so what is the actual loss function?Think for a moment about how the costs of quality would vary with the products deviation oneither side of the mean. Now if you were to plot the costs versus the diameter of a nut, forexample, you would have a quadratic function, with a minimum of zero at the target diameter.
SATYA TQM Page 11We expect therefore that the loss (L) will be a quadratic function of the variance (σ, or standarddeviation) from the target (m). The squared-error loss function has been in use since the 1930s,but Taguchi modified the function to represent total losses. Next we will walk though thederivation of the Taguchi Loss Function.Loss functions for one piece of product:Where:L = Loss in Dollarsy = Quality Characteristic (diameter, concentration, etc)m = Target Value for yk = Constant (defined below)The cost of the counter measure, or action taken by the customer to account for a defectiveproduct at either end of the specification range, Ao, is found by substituting y = m + Δ0 into theloss function:Now we can solve for the constant k,Since we are not usually concerned with only one piece of product, the loss function for multipleunits isThe process capability index (Cp) is used to forecast the quality level of non-defective productsthat will be shipped out. The Cp has been used in traditional quality control and is defined ratherabstractly as:where represents the tolerance of the product.Substituting k into the loss function and then rearranging in terms of Cp,Taguchi Loss Function:The Taguchi quality loss function is a way to assess economic loss from a deviation in qualitywithout having to develop the unique function for each quality characteristic. As a function ofthe traditionally used process capability index, it also puts this unit less value into monetaryunits.
SATYA TQM Page 12Quality Loss Function for Various Quality CharacteristicsThere are three characteristics used to define the quality loss function:1. Nominal–the-Best Characteristic2. Smaller-the-Better Characteristic3. Larger-the-Better CharacteristicEach of these characteristic types is defined by a different set of equations, which is differentfrom the general form of the loss function equationNoriaki Kano’s concept of basic,The Kano model offers some insight into the product attributes which are perceived to beimportant to customers. The purpose of the tool is to support product specification anddiscussion through better development of team understanding. Kanos model focuses ondifferentiating product features, as opposed to focusing initially on customer needs. Kano alsoproduced a methodology for mapping consumer responses to questionnaires onto his model.Threshold or Basic AttributesOne of the main points of assessment in the Kano model is the threshold attributes. These arebasically the features that the product must have in order to meet customer demands. If thisattribute is overlooked, the product is simply incomplete. If a new product is not examined usingthe threshold aspects, it may not be possible to enter the market. This is the first and mostimportant characteristic of the Kano model.The product is being manufactured for some typeof consumer base, and therefore this must be a crucial part of product innovation. Thresholdattributes are simple components to a product. However, if they are not available, the product
SATYA TQM Page 13will soon leave the market due to dissatisfaction. The attribute is either there or not. An exampleof a threshold attribute would be a steering wheel in a vehicle. The vehicle is no good if it is notable to be steered.The threshold attributes are most often seen as a price of entry. Many products have thresholdattributes that are overlooked. Since this component of the product is a necessary guideline,many consumers do not judge how advanced a particular feature is. Therefore, many timescompanies will want to improve the other attributes because consumers remain neutral tochanges in the threshold section.Performance AttributesA performance attribute is defined as a skill, knowledge, ability, or behavioral characteristic thatis associated with job performance. Performance attributes are metrics on which a companybases its business aspirations. They have an explicit purpose. Companies prioritize theirinvestments, decisions, and efforts and explain their strategies using performance attributes.These strategies can sometimes be recognized through the company‘s slogans. Forexample Lexuss slogan is ―The Pursuit of Perfection‖ (reliability) and Walmart; ―Always lowprices. Always‖ (cost). In retail the focus is generally on assuring availability of products at bestcost.Performance attributes are those for which more is better, and a better performance attribute willimprove customer satisfaction. Conversely, a weak performance attribute reduces customersatisfaction. When customers discuss their needs, these needs will fall into the performanceattributes category. Then these attributes will form the weighted needs against the productconcepts that are being evaluated. The price a customer is willing to pay for a product is closelytied to performance attributes. So the higher the performance attribute, the higher the customerswill be willing to pay for the product. Performance attributes also often require a trade-offanalysis against cost. As customers start to rate attributes as more and more important, thecompany has to ask itself, ―how much extra they would be willing to pay for this attribute?‖ And―will the increase in the price for the product for this attribute deter customers from purchasingit.‖ Prioritization matrices can be useful in determining which attributes would provide thegreatest returns on customer satisfaction.Excitement AttributesNot only does the Kano Model feature performance attributes, but additionally incorporates an―excitement‖ attribute as well. Excitement attributes are for the most part unforeseen by theclient but may yield paramount satisfaction. Having excitement attributes can only help you, insome scenarios it is ok to not have them included. The beauty behind an excitement attribute is tospur a potential consumers‘ imagination, these attributes are used to help the customer discoverneeds that they‘ve never thought about before. The key behind the Kano Model is for theengineer to discover this ―unknown need‖ and enlighten the consumer, to sort of engage that―awe effect.‖ Having concurrent excitement attributes within a product can provide a significantcompetitive advantage over a rival. In a diverse product assortment, the excitement attributes actas the WOW factors and trigger impulsive wants and needs in the mind of the customer. Themore the customer thinks about these amazing new ideas, the more they want it. Out of all the
SATYA TQM Page 14attributes introduced in the Kano Model, the excitement ones are the most powerful and have thepotential to lead to the highest gross profit margins. Innovation is undisputedly the catalyst indelivering these attributes to customers; you need to be able to distinguish what is an excitementtoday, because tomorrow it becomes a known feature and the day after it is used throughout thewhole world.Attributes place on the model change over timeAn attribute will drift over time from Exciting to performance and then to essential. The drift isdriven by customer expectations and by the level of performance from competing products.For example mobile phone batteries were originally large and bulky with only a few hours ofcharge. Over time we have come to expect 12+ hours of battery life on slim lightweight phones.The battery attributes have had to change to keep up with customer expectations.MODULE 3Quality Control ToolsSeven QC tools-process flow chart• Pareto chart• Cause and effect diagram• Histogram• Stratification• Scatter diagram• Control charts• Check sheets
SATYA TQM Page 15Pareto chart,• Pareto Diagram is a technique of arranging data according to priority or importance andusing it into a problem solving frame work.• This concept was first coined by Alfredo Pareto who conducted extensive studies of thedistribution of wealth in Europe and came to the conclusion that approximately 80% ofthe wealth is concentrated in 20% of the population.• This was extended to the customer base where it was observed that approximately 80% ofthe business comes from 20% of the customers.• For e.g. an auto ancillary organization has 15 automobile manufacturers as its customersand their annual turnover is Rs.500 crores, applying the above principle, it means theturnover of approximately Rs.400 crores is from three of their customers.• 80% of the defectives likely to be due to 20% of the type of causes or defects.• Under this method, data relating to the causes of rejections are collected, analyzed andtabulated to find out the effect of the causes on rejections. In many cases of rejections,may be the same few causes may have resulted in major rejection. There may be othercauses the share of which in total rejection may be negligible. Therefore, to improvequality, one needs to concentrate on those few causes instead of many less importantcausesType of defect Number Percent of totalIncomplete (A)Surface Scars (B)Cracks (C)Others (D)Misshapen (E)4832238442282073
SATYA TQM Page 16Histogram,• Histogram is a tool to study the process variability. It is a graphical representation of afrequency distribution which is a summary of variation in a product or process.• The various inputs that go into a process for producing an output have their inherentvariations. The examples of such inputs are raw materials, machine condition, operatorskills, process parameters, factors in the environment etc.• Even though we accept the any process has certain variations, we still want the product tobe as close as possible to the mean value in a normal distribution curve. Hence, wecollect data by taking sample observation from the population. The data is then plotted inthe form of vertical bars with the particular parameter being measured on the x axis andthe frequency of occurrence of the parameter on the y axis.• A histogram analyses and graphically displays quantitative data rather than qualitativedata.• Histograms help managers to achieve deeper insight into the characteristics of datadistributions associated with activities.
SATYA TQM Page 17Cause & effect diagram,• Also called Fish Bone Diagram or Ishikawa Diagram or Root Cause Analysis Diagram, itis a pictorial presentation in which all possible causes and the effects are displayed.• The effect or outcome is shown on the right side of the diagram and the causes are shownalong the spine of the diagram.• The causes are broken down into detailed causes. The C.E diagram brings out thepotential causes of the problem clearly. These causes are evaluated to narrow down to thereal causes.• C.E. diagrams are sketched by the quality or problem solving teams. Brainstorming isused to arrive at possible causes• If some difficulty is experienced in starting off the diagram, use the ‗6 Ms‘ (men/people,machines, methods, materials, management, mother earth/environment) as six initial‗bones‘. Other alternatives for service operations are to use the ‗6 Ps‘ (Places,Procedures, People, Policies, Process, Plant/Machinery), or the ‗6 Ss‘ (Surroundings,Suppliers, Systems, Skills, Strategy, Service). Usually the diagram is built with oneperson writing in points on the diagram and a team contributing their ideas.
SATYA TQM Page 18Check sheets,• Check sheets provide a systematic means of collecting and analyzing data. Check sheetsare special types of data collection forms in which the results may be interpreted on theform directly without additional processing.• Check sheets facilitate systematic record keeping or data collection. Observations arerecorded as they happen which reveals patterns or trends.• The check sheets are useful for both final testing of the product/service and also fortesting during the process. Check sheets are commonly used for equipment maintenance.
SATYA TQM Page 19Stratification• Stratification is the process of separation of data into categories. It is normally done foridentifying the categories contributing to the problem being tackled.• Stratification is the process to classify large amount of data to find out whether we canget indication of problem point.• Quality is influence by multiply causes or elements. Compounding the effect of thesecauses makes it difficult to find clear relationship between element and quality i.e.between causes and result.• For this purpose, we categorized or group data in a particular way where by the group hasan identity of its own.• For example, in a company the defectives were above 10%. The training and awarenessof the operators were not helping the situation. Then they segregated the productionoperator wise and found that 5% of the operators were responsible per more than 70% ofthe defect.• The sources / bases for stratification could be material, machine, operator, time / season,supplier, customer, department etc.Scatter diagrams,• This tool is particularly useful to determine which factor or parameter can be attributed tothe occurrence of a particular defect. For example, in a factory making rubber mouldedcomponents it was initially thought that a particular defect was attributed to use of higherproportion of carbon black. The proportion was varied and different samples taken and ascatter diagram was constructed. It was found that the points were scattered and there wasno correlation i.e. the strength of correlation was very low. Hence it was clear that theproportion of carbon black was not the reason for the defect. Another variable viz processoil quantity was manipulated and again the correlation diagram was drawn. It wasobserved that the correlation was very strong i.e. all the points were close to thecenterline.
SATYA TQM Page 20Statistical quality control,• SQC is the application of statistical techniques to accept or reject products alreadyproduced or to control the processes and , therefore, product quality while the part isbeing made.
SATYA TQM Page 21• SQC for process control is based on the probability theory.• When several identical parts are manufactured, some will be on the higher side and someon the lower side. The middle or average will be the most frequent. When we plot thesize and the frequency or the count of the items, a normal or bell shaped curve results.Advantages of SQC1. Helps prevent defects. The assignable causes for deviation in quality are detected andrectified.2. It helps to avoid the risk of accepting a bad lot.3. Since only samples are inspected, SQC avoids inspecting the entire lot.4. Ensues maintenance of high quality standards and enables building up of customergoodwillControl charts-types, benefits,A Control Chart is an instrument for monitoring a process in real time with the view to predictwhether and when a process is likely to go out of control so that corrective actions can beinitiated well in time.Benefits of Control Chart• Simple to use• Enables synthesis, visualizations and interpretation of data• Enables forecasting to a large extent about what is going to happen• Helps in taking timely decisions
SATYA TQM Page 22Process capability studies,ProcessA process is the work performed with a set of inputs – raw materials, machines, and employeesthat adds value and provides a product or service for the customer (internal or external).CapabilityProcess capability is the ability of a process to produce products or services in a state ofstatistical control (predictable) for a period of time under a given set of conditions. Outsideinfluences (special causes of variation) must be eliminated from the process in order to obtainthis level of statistical control.Process Capability StudyAfter determining that our gauge(s) are capable of measuring to the level of precision necessaryand that our process is operating in a state of statistical control, we can perform the processcapability analysis. This final step is the comparison of our process spread, as defined by the +3 spread of a normal distribution (for measurement data) or the location and spread of thePoisson distribution (λ for attributes) to our product or service tolerances. We will only look atvariable data, not attributes, in this seminar.Capability indices Cp & Cpk,Numerical on Cp & Cpk
SATYA TQM Page 23MODULE 4Eight QMS principles,• Principle 1: Customer Focus• Principle 2: Leadership• Principle 3: Involvement of people• Principle 4: Process approach• Principle 5: Systems approach for management• Principle 6: Continual improvement• Principle 7: Factual approach to decision making• Principle 8: Mutually beneficial supplier relationships.Need for ISO 9000 & other quality systems,• Certification for Quality Management System (QMS)• Standards initiated by International Organization for Standardization, headquartered inGeneva, Switzerland. This organization plays a major role in setting quality standards forglobal manufacturers• These standards are in use for external quality assurance for contracts to provide thirdparty assurance to the customer of a company‘s ability to satisfy contractual requirements• International Organization for Standardization was founded in 1946. The first set ofwritten quality standards published in 1987. First revision took place in 1994 and thesecond revision in 2000.• The latest and currently in use standard is ISO 9001:2008• No guarantee of quality: It guarantees consistency of quality of output subject tofollowing the procedures• Standards are generic- they are written for all companies irrespective of the size, industry,country and sectors of company activities being measured• There are several assessing bodies all over the world. Thus, interpretation is the key tothe standard
SATYA TQM Page 24Features of ISO 9000• It is obligatory to identify non-conformities. Non-conformity is a shortfall between whatis desired to be achieved and what is actually achieved• Systematic prevention of non-conformities• The philosophy is ―Do what you say and Say what you do‖• It requires a formally documented procedure for each and every activity which is likely tohave a bearing on quality either directly or indirectly• It requires faithful implementation of procedures and their revision if called forBenefits of ISO Standards• Uniformity• Assurance of product quality• Improvement in market share.• Disciplined approach• Export advantageISO 9001:2000 & 2008 elements,• The international standard specifies requirements of a quality management system wherean organization:a. Needs to demonstrate its ability to consistently provide products / services that meetcustomer and applicable regulatory requirements.b. Aims to enhance customer satisfaction through the effective application of the systemincluding processes for continued improvement of the system.Documentation for quality systems,Implementation of quality systems,
SATYA TQM Page 25Role of MR, quality audits,TS 16949,The ISO/TS16949 is an ISO technical specification aiming to the development of a qualitymanagement system that provides for continual improvement, emphasizing defect preventionand the reduction of variation and waste in the supply chain. It is based on the ISO 9001 and thefirst edition was published in March 2002 as ISO/TS 16949:2002.It was prepared by the International Automotive Task Force (IATF) and the "TechnicalCommittee" of ISO. It harmonizes the country-specific regulations of Quality-Management-Systems.About 30 percent of the more than 100 existing automobile manufacturers affiliate therequirements of the norm but especially the large Asian manufacturers have differentiated, ownrequirements for the quality management systems of their corporate group and their suppliers.TS16949 applies to the design/development, production and, when relevant, installation andservicing of automotive-related products. It is based on ISO 9001.The requirements are intended to be applied throughout the supply chain. For the first timevehicle assembly plants will be encouraged to seek ISO/TS16949 certification.ISO 14000-standard requirements objectives & benefits
SATYA TQM Page 26MODULE 5Quality functions deployment QFD is a planning tool used to fulfill customer expectations. Focuses on Voice of the customer. Market research attempts to capture the voice of customer but they sometimes conflict,and lack clarity.This is where voice of the customer gets lost and voice of the organization entersBenefits of QFD: Improves customer satisfaction– Defines requirements in a set of basic needs and compares it to all competitiveinformation.– Management can then place resources where they will be the most beneficial inimproving quality. Reduces implementation time– Fewer engineering changes needed– Critical to quality issues are identified and monitored from product inception toproduction. Promotes team work– Horizontal deployment of communication channels– Avoids misinterpretation, opinions and miscues. Provides documentation– Database for future design or process improvements is created.– Serves as a training tool for new engineers
SATYA TQM Page 27Benchmarking, Level How do todays business leaders sustain their competitive edge? By staying abreast of the latest, best practices and learning to apply them to every aspectof their organization.Whether you work in accounts payable, travel & entertainment, planning & budgeting,inventory management or payroll, learning about, customizing and implementing the bestpractices is the surest way to enhance the efficiency and effectiveness of your work Implicit in benchmarking are two key elements: Measuring performance in numerical terms (metrics). Requires some sort of units ofmeasure.– The numbers achieved by the best in class benchmark are the target.– Organization seeking improvement plots its own performance against the target.– Think of measures of performance in your manufacturing unit? service unit? ForHR processes? Benchmarking requires that managers understand why their performance differs.– Bench markers must develop a thorough and in-depth knowledge of both theirown processes and the processes of the best-in-class organization.– An understanding of the differences allows the managers to organize theirimprovement efforts to meet the goal.Benchmarking is about setting goals and about meeting them by improving processes
SATYA TQM Page 28Types of benchmarking1. Internal– Comparison within the organization of similar activities.– Data easy to obtain2. Competitive– Organization‘s survival depends on its performance relative to competition– Through surveys, reports, customers, suppliers, buying customers product to takeapart and test.3. Process.– Many processes are common across industry boundaries, and innovations fromother types of organizations can be applied across industries.– It is relatively easy to find organizations with world class operations throughpublished information, suppliers and consultants.– For example, processes of payroll and accounts receivable, order processing,design, logistics etc..Benchmarking process, Decide what to benchmark Understand current performance Plan Study others Learn from the data Use the findings
SATYA TQM Page 29Brainstorming,Process for generating creative ideas and solutions through intensive and freewheeling groupdiscussion Every participant is encouraged to think aloud and suggest as many ideas as possible,no matter seemingly how outlandish or bizarre. Analysis, discussion, or criticism of the airedideas is allowed only when the brainstorming session is over and evaluation session begins. Seealso lateral thinking and nominal group technique.Cost of quality,• Failure costs• Appraisal costs• Prevention costs• Hidden costs Prevention Cost –Planning, Document, Control, Training Appraisal Cost –Inspection & Tests, Installation, Calibration, M/c Depreciation, Reports& Rejects. Internal Failure Cost – Scraps, Repair Rework, Design Changes, Defect Failure Analysis,Retests & Reinsertion, Downgrading, Down Time. External Failure Cost – Complaints, Goodwill, Failures, Services & Replacement,Guarantee & Warranty, Compensation, Recall, Loss of Sales, Seconds Sales.MODULE 6Word Class PracticesIntroduction to six sigma,• Six Sigma is a concept developed by Motorola and now adopted by many organizations.Motorola defined Six Sigma as a measure of goodness – a capability of a process toproduce perfect work. The Six Sigma concept is about the aim of making all processes inthe chain highly capable• Six Sigma refers to the number of standard deviation from the average setting of aprocess to the tolerance limit. In statistical terms, this translates to 3.4 defects per millionopportunities for error. For such levels of quality, both Design and Manufacturing have toplay a major role.
SATYA TQM Page 30Kaizen,Quality circles,• Teams of workers and supervisors that meet regularly to address work-related problemsinvolving quality and productivity.• Developed by Kaoru Ishikawa at University of Tokyo.• Became immediately popular in Japan as well as USA.• Lockheed Missiles and Space Division was the leader in implementing Quality circles inUSA in 1973 (after their visit to Japan to study the same).• Typically small day-to-day problems are given to quality circles. Since workers are mostfamiliar with the routine tasks, they are asked to identify, analyze and solve qualityproblems in the routine processes.TPM,• TPM: Combines TQM concept with strategic view of maintenance from process andequipment design to preventive maintenance• It is a method designed to eliminate the losses caused by breakdown of machines byidentifying and attacking all causes of equipment breakdowns and system down time• It places a high value on teamwork, consensus building and continous improvementOEE,• Overall Equipment Effectiveness (OEE) is a tool that combines multiple manufacturingissues and data points to provide information about the process.• By having a predetermined framework of the impact of machine availability, operatorperformance and quality, OEE provides a framework to track underlying issues and rootcauses.• OEE also provides a framework for improvements in the manufacturing process.• OEE takes into account the various sub components of the manufacturing process vizAvailability, Performance and Quality.
SATYA TQM Page 31• OEE = Availability x Performance x Quality.Availability = Gross operating time• Available production timePerformance = Actual productionStandard production• Quality =Parts produced –defectivesParts producedEight Piller of TPM,• Kobetsu – Kaizen (individual improvement)• Jishu –Hozen (autonomous maintenance)• Planned Maintenance• Education and Training• Quality Management System• TPM in Administration and Support Systems• Layout, Safety, Health and Environment• Development ManagementJishu hozenTangible & intangible of TPM, Productivity improvement Quality improvement Reduction in defectives
SATYA TQM Page 32 Reduction in Customer Complaints Cost Reduction Delivery Timely Safety Zero accidents Reduction in Pollution (Responsibility to society) Morale of employees Participation Suggestion schemes Increased equipment operating time Reduction in maintenance cost Reduction in inventories Better handling and layoutThe Intangible Benefits of implementing TPM• Introduction to autonomous maintenance. Operators take care of machines by themselves& no need to order or remind them. The operators‘ sense of belongingness increases asthey take ownership of the machines.• Neat and clean workplace – people find it pleasant and enjoyable to work.• Zero defects and zero breakdowns induce a new confidence in the abilities of theoperators.• Improved company image leading to more and more new customers.Five S-definition, misconceptions, benefits, how to implement Five S, The concept of Five S is a practical approach for better work place management and wasoriginally developed in Japan by Takashi Osada. The features are common to allfunctional areas and can be applied to workshop as well as offices. It also helps inpromoting teamwork. Five S and TPM go hand in hand and most organizationsimplement them simultaneously.
SATYA TQM Page 33 Five S serves as a barometer for assessing the capability of an organization and is an easyprocess to follow which can make anything to work well. Five S driven workplace enhances productivity and fosters a productivity culture througha continual process of identifying, reducing and eliminating the Mudas. Five S is a set of techniques providing a standard approach to housekeepingHow do we benefit from implementation of Five S? Defect Prevention Accident Prevention Cleanliness and good housekeeping Conducive work environmentWhat are the Five S?• SEIRI: Sorting - Organization or Reorganization• SEITON: Systematize – Location for each item• SEISO: Shine - Clean up, spic and span• SEIKETSU: Standardize – All procedures• SHITSUKE: Self discipline – Adopt as a way of life.How to make Five S work effectively?• Top management support is a must.• Proper planning – date and time to launch the activity.• Give wide publicity – create awareness at all levels.• Budget for the activity.• Work out a schedule with targets.• Not necessary to take up in all areas simultaneously. May pick up a conducive area andalso one that badly needs such an activity.• Create interest and healthy competitive spirit – awards for people who do good jobs.Poka Yoke,
SATYA TQM Page 34Poka Yoka [poka joke] is a Japanese term that means "fail-safe" or "mistake-proofing". A poka-yoke is any mechanism in a lean manufacturing process that helps an equipment operator avoid(yokeru) mistakes (poka). Its purpose is to eliminate product defects by preventing, correcting, ordrawing attention to human errors as they occur. The concept was formalized, and the termadopted, by Shigeo Shingo as part of the Toyota Production System. It was originally describedas baka-yoke, but as this means "fool-proofing" (or "idiot-proofing") the name was changed tothe milder poka-yoke.MODULE 7Supplier QualityDeveloping supplier partnership,Vender selection,Principles Applied to Vendor SelectionSeveral over-arching principles will be applied to the vendor selection process. The mostimportant of these are as follows:1. Transparency – the process of vendor selection was done and continues to be done in the openusing clearly defined selection criteria. Evaluations of the vendors and their EHRs will bedocumented and auditable MAXIMUS2. Fairness – Every vendor offering a responsible, compliant EHR product is treated fairly withselection solely dependent upon the quality of their offering and the value they offer theProviders.3. Inclusiveness – vendor selection is ultimately accomplished by a representative panel ofstakeholders, including providers, consumers, technical consultants, and Ponce School ofMedicine staff.4. Value – vendors must offer an attractive value proposition to the Providers and be best able tohelp the Providers achieve Meaningful Use standards as they begin to be applied in 2011 andbeyond.5. Protection – vendors must agree to a standard set of terms and conditions prepared by the RECfor inclusion in each vendor‘s standard contract. These assure the Providers that the contract
SATYA TQM Page 35Will protect the interests of the Providers as well as those of the vendor Although we plan tooffer a short-list of participating vendors as options to the Providers making their finalselections, every vendor will have an equal chance of qualifying through the process and ofreapplying later if they so choose.Vendor Selection CriteriaThe vendor selection criteria consist of three discrete sets of judgments applied at different stagesOf the process to arrive at a final status these criteria are listed below by the stage in the processat which they are applied.Stage 1: Initial Screening1. Full Response to RFI2. ONC certified or close (modular certification allowed if full EHR certification is expected)3. Product covers an array of specialties4. In use among Providers elsewhere5. Spanish Language capabilities6. Sure Scripts Certified7. HIPAA Privacy compliance8. Practice Management Functionality (CPT4, ICD 9-10)9. Technical Interface capability10. Manpower for Implementation11. Local staff resources12. At least one MD on staff or available as a consultant13. User Ratings or references
SATYA TQM Page 36Stage 2: Detailed Assessments1. Usability2. Demonstrations3. Customizability MAXIMUS4. Role-based security5. ONC Stage 1 CertificationStage 3: Final Agreements1. Agreement with PSM REC Standard Terms and Conditions2. Willingness to partner with the REC on promotion, implementation, and support3. Willingness to offer favored pricing to ProvidersVender development,Vendor Development can be defined as any activity that a Buying Firm undertakes to improve aSuppliers performance and capabilities to meet the Buying Firms supply needs.Person/company who sells and supplies his/its products Identifying Developing Evaluatingcontinuous appraisal Points to be considered Quantity, time, material, volume, commercialviability A list of potential suppliersAdvantages:Able to develop more competition in the supply market as well as eliminate the monopolyCompany can buy material from number of sources Reduce the risk of non availability orshortage of input materials over a number of suppliers In case of emergencies
SATYA TQM Page 37Stages of vendor developmentSurvey stage:Collecting information on different suppliers of the desired materials Trade directories: Dealer‘saddresses, regional offices, names, types and range of products including spares Trade journals:advertisements of the materials related to specific industries Telephone directories: classifiedadvertisements arranged alphabetically, item wise or group wise - easy and fast:Inquiry stage – selection of potential suppliersDetailed analysis Accreditation, FDA approval and certifications Comparison bet‘ –technological competition - service competition - price competition - time based competition(TBC), i.e., response time for delivery Internal facilities of vendors: under supervision ofqualified and experienced staff additional facilities Modern equipment, quality of inputs,maintenance, size and capacity, layout, housekeeping and cleanlinessNegotiations and selection stage:Negotiations and selection stage Finalization of vendors Credit, quantity discount, qualityspecifications etc can be decided List of approved vendors Purchase orders are placed.Experience and evaluation stage- consolidation of vendors:Experience and evaluation stage- consolidation of vendors To improve the performance ofvendors Evaluation especially on 2 counts, quality and delivery dif‘ methods: Categoricalmethod Weighted point method Cost ratio method.Factors to be considered for vender evaluation & selection,1.QUALITYWhy do companies that apparently have nothing whatsoever to do with technology invest bigamounts of money in IT projects? The bottom line is that they all want the overall efficiency andQuality of their end product or service to nourish and improve. Maintaining quality standardsand providing quality service to facilitate customers and end users is the key to win theirconfidence in the firm‘s goodwill. This would mean that while evaluating a vendor for your ITproject, make Quality your priority. You can only hope to deliver good quality through thisinvestment if your vendor delivers good quality to you.2.PRICE/COSTPrice or cost of the project quoted by the vendors has always been considered as one of the mostimportant aspect of vendor selection criteria. However, it is the ―Value-for-money‖ that matters
SATYA TQM Page 38the most. Price alone can and should never act as the governing principle or you might end uppreferring a cheap vendor selling a failed project over a costly vendor selling an excellentproduct. Value of money can thus act as a governing principle.3. FINANCIAL HEALTH/STABILITYThe financial stability of the vendor is another important criterion to consider before makingyour choice. If the vendor itself isn‘t financially sound, it can never become a reliable source foryour organization because in order to provide quality product using excellent expertise one mustalso possess such resources.4. PAST PERFORMANCE RECORDSFirms must also carefully examine the performance history of the vendor. If the vendor seems tohave shown good results, maintains a happy customer base and seems to have sustained itsquality of performance over the years it is probably a good investment to do business with such avendor. Even those vendors that are good but show inconsistency in their performance are riskybusiness partners.Numerical in vender rating,
SATYA TQM Page 39MODULE 8Strategic Quality ManagementQuality policy relation to corporate policy,Total quality & competitive advantage,Total Quality Management (TQM) has become, according to one source, ‗as pervasive a part ofbusiness thinking as quarterly financial results,‘ and yet TQMs role as a strategic resourceremains virtually unexamined in strategic management research. Drawing on the resourceapproach and other theoretical perspectives, this article examines TQM as a potential source ofsustainable competitive advantage, reviews existing empirical evidence, and report‘s findingsfrom a new empirical study of TQMs performance consequences. The findings suggest that mostfeatures generally associated with TQM—such as quality training, process improvement, andbenchmarking—do not generally produce advantage, but that certain tacit, behavioral,imperfectly imitable features—such as open culture, employee empowerment, and executivecommitment—can produce advantage. The author concludes that these tacit resources, and notTQM tools and techniques, drive TQM success, and those organizations that acquire them canoutperform competitors with or without the accompanying TQM ideology.Quality planning process,Quality Planning is the process for "identifying which quality standards are relevant to theproject and determining how to satisfy them": Quality planning means planning how-to fulfillprocess and product (deliverable) quality requirements: "Quality is the degree to which a set ofinherent characteristics fulfill requirements"By planning the quality one has to respect some principles:Customer satisfaction comes first: Quality is defined by the requirements of the customer.Prevention over inspection: Its better to avoid mistakes than to inspect the result and repair thedefects.Management responsibility: Costs of quality must be approved by the management.Continuous improvement: Becoming better is an iteratively structured process.