tqm

1. What is TQM?
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 Meeting quality expectations as defined
by the customer
 Integrated organizational effort
designed to improve quality of
processes at every business level

2. TQM is an approach to improve the effectiveness
and flexibilities of business as a whole. It is
essentially a wayof organizing and involving the
whole organization, every department, everyactivity
and every single person at every level.
TQM ensures that the management adopts a
strategic overview of the quality and focuses on
prevention rather than inspection.

3. Competition is getting harder and becoming global.
Companies now have to be more responsive, offer a better
product and keep improving.
Total quality management (TQM) increases customer
satisfaction by boosting quality. It does this by motivating the
workforce and improving the way the company operates. In
an increasingly competitive market, firms with a continuous
improvement culture and external focus are more likely to
survive and prosper.
TQM is considered an important catalyst in this
context.

4. Defining Quality – 5 Ways
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 Conformance to specifications
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Does product/service meet targets and tolerances defined
by designers?
Fitness for use
 Evaluates performance for intended use
 Value for price paid
 Evaluation of usefulness vs. price paid
 Support services
 Quality of support after sale
 Psychological
 e.g. Ambiance, prestige, friendly staff

5. Manufacturing Quality vs.
Service Quality
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 Manufacturing quality focuses on
tangible product features
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Conformance, performance, reliability, features,
durability, serviceability
Service organizations produce intangible
products that must be experienced
 Quality often defined by perceptional factors like
courtesy, friendliness of staff, promptness in
resolving complaints, atmosphere, waiting time,
consistency

6. Dimensions of Quality for Manufacturing
vs. Service Organizations
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 Conformance to
specifications
Performance
Reliability
Features
Durability
Serviceability
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 Manufacturing Service
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 Tangible factors
Consistency
Responsiveness to
customer needs
Courtesy /
friendliness
Timeliness /
promptness
Atmosphere

7. Quality in Practice
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Motorola and GE attribute their success to
having one of the best quality management
programs in the world.
Six-Sigma was implemented
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 Levels of defects is reduced to 3.4 parts per
million
Everyone is trained in quality improvement
principles and techniques
Black-Belt – their full time job is to identify and
solve quality problems

8. Cost of Quality
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Quality effects all aspects of the organization and have dramatic
cost implications
Most obvious consequence of poor quality is dissatisfied
customers and eventual loss of business
Prevention costs – cost of preparing and implementing a quality
plan
Appraisal costs – cost of testing, evaluating and inspecting
quality
Internal failure costs – cost of scrap, rework, and material
losses
External failure costs – cost of failure at customer site, including
returns, repairs and recalls
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External failures can sometimes put a company out of business
almost overnight
External failure costs tend to be particularly high for service
organizations

9. Cost of Defects
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10. The Evolution of TQM
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Early 20th century – Quality meant inspection.
Reactive in nature
1980s – Quality began to have strategic
meaning. Proactive in nature
Successful companies understand that quality
provides a competitive advantage
Put customer first, and define quality as
meeting or exceeding customers expectation
Quality excellence has become a standard for
doing business

11. Evolution of TQM – New Focus
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12. Quality Gurus
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 Walter A. Shewhart (1920s & 1930s)
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Grandfather of quality control
Contributed to understand the process of variability
Developed concept of statistical control charts
 W. Edwards Deming (1940s & 1950s)
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Father of quality control
Stressed management’s responsibility for quality
Developed “14 points” to guide companies in quality
improvement
Japanese established “Deming Prize” in his name
15% of quality problems are actually due to worker error
85% of quality problems are caused by systems and errors

13. Quality Gurus – contd.
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 Joseph M. Juran (1950s)
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Defined quality as “fitness for use”
Developed concept of cost of quality
Originated idea of quality triology
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Quality planning
Quality control
Quality improvement
 Armand V. Feigenbaum (1960s)
 Introduced the concept of total quality control
 Philip B. Crosby (1970s)
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Coined phrase “quality is free”
Introduced concept of zero defects
Developed the phrase “Do it right the first time”

14. Quality Gurus – contd.
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 Kaoru Ishikawa
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Developed cause-and-effect diagrams
Identified concept of “internal customer”
Introduced the concept of “quality circles”
 Genichi Taguchi
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Focused on product design quality
Developed Taguchi loss function
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Costs of quality increase as a quadratic function as
conformance values move away from target
Robust Design
 A design that results in a product that can perform over a
wide range of conditions

15. TQM Philosophy – What’s Different?
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TQM attempts to embed quality in every aspect of the
organization
Focus on Customer
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Identify and meet customer needs
Stay tuned to changing needs, e.g. fashion styles
 Continuous Improvement
 Continuous learning and problem solving, e.g. Kaizen, 6 sigma
 Quality at the Source
 Inspection vs. prevention & problem solving
 Employee Empowerment
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Empower all employees; external and internal customers
Team approach, quality circle

16. TQM Philosophy– What’s Different?
(continued)
Certifying suppliers vs. receiving inspection
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 Understanding Quality Tools
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Ongoing training on analysis, assessment, and
correction, & implementation of quality tools
Team Approach
 Teams formed around processes – 8 to 10 people
 Meet weekly to analyze and solve problems
 Benchmarking
 Studying practices at “best in class” companies
 Managing Supplier Quality

17. 19
Four Dimensions of Quality
 Quality of design
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Determining which features to include in the final
design
Quality of conformance to design
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Production processes are set up to meet design
specifications
Ease of use
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 Instructions, operation, maintenance, safety
Post-sale service
 Responsiveness, rapid repair, p.m., spare parts

18. Cost of Quality – 4 Categories
 Early detection/prevention is less costly
 May be less by a factor of 10
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19. Ways of Improving Quality
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 Plan-Do-Study-Act Cycle (PDSA)
 Also called the Deming Wheel after its originator
 Circular, never ending problem solving process
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Quality Function Deployment
 Used to translate customer preferences to design
Seven Tools of Quality Control
 Tools typically taught to problem solving teams

20. 22
PDSA Details
 Plan
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 Evaluate current process
Collect procedures, data, identify problems
Develop an improvement plan, performance
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objectives
Do
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 Implement the plan – trial basis
Study
 Collect data and evaluate against objectives
Act
 Communicate the results from trial
 If successful, implement new process

21. PDSA (continued)
 Cycle is repeated
 After act phase, start planning and repeat process
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22. Quality Function Deployment
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A tool used to translate the preferences of the
customer into specific technical requirements
QFD begins by identifying customer requirements,
coming from marketing department
These requirements are numerically scored, based on
their importance, and scores are translated into
specific product characteristics
Comparison of product is made with its competitors,
relative to identified characteristics
Specific goals are set to address identified problems
The resulting matrix looks like a picture of house and
is often called the “house of quality”

23. QFD – Contd.
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 Customer requirements
 Survey customers to find out what they
specifically need in our product
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Focus groups, telephonic interviews, directly talk to
customers
Competitive Evaluation
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 How our product compares to those of
competitors
Evaluation scale is from one to five
Higher the rating, the better

24. QFD – Contd.
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 Product Characteristics
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Specific product characteristics are on top of relationship
matrix
The Relationship Matrix
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The strength of relationship between customer requirements
and product characteristics is shown in the relationship
matrix
A negative relationship means that as we increase the
desirability of one variable, we decrease the desirability of
other
A positive relationship means that as increase in desirability
of one variable is related to an increase in the desirability of
another

25. QFD – Contd.
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 The Trade-off Matrix
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 The roof of house is put through trade-off matrix
Shows how each product characteristics is related
to the others
What trade-offs we need to make
 Setting Targets
 The bottom row of the house is the output of QFD
 These are specific, measurable product
characteristics that have been formulated from
general customer requirements

26. Seven Problem Solving Tools
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Cause-and-Effect Diagrams
Flowcharts
Checklists
Control Charts
Scatter Diagrams
Pareto Analysis
Histograms

27. Cause-and-Effect Diagrams
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Called Fishbone Diagram
Focused on solving identified quality problem
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28. A general cause-and-effect
diagram
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29. Flowcharts
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Used to document the detailed steps in a
process
Often the first step in Process Re-Engineering
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30. Checklist
 Simple data check-off sheet designed to
identify type of quality problems at each work
station; per shift, per machine, per operator
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31. Control Charts
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Important tool used in Statistical Process
Control – Chapter 6
The UCL and LCL are calculated limits used to
show when process is in or out of control
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32. Scatter Diagrams
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A graph that shows how two variables are
related to one another
Data can be used in a regression analysis to
establish equation for the relationship
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33. Pareto Analysis
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Technique that displays the degree of importance for each
element
Named after the 19th century Italian economist
Often called the 80-20 Rule
Principle is that quality problems are the result of only a few
problems e.g. 80% of the problems caused by 20% of causes
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34. Histograms
 A chart that shows the frequency distribution of
observed values of a variable like service time
at a bank drive-up window
 Displays whether the distribution is symmetrical
(normal) or skewed
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35. Reliability
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The probability that a product, service. Or part will perform, as
intended.
No product is guaranteed with 100% certainty to function
properly
High reliability is an important part of customer-oriented quality
The reliability of a product is a direct function of the reliability of
its component parts.
If all the parts in a product must work for the product to
function, then the reliability of the system is computed as
product of the reliabilities of the individual components:
Rs = (R1)(R2)(R3)……(Rn)
Where Rs = reliability of the product or system
R1…n = reliability of components 1 through n

36. Reliability – contd.
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The more components a product has, the lower its
reliability
The failure of certain products can be very critical.
One way to increase product relaibility is to build
redundancy into product design in the form of
backup parts
Redundancy is built into the system by placing
components in parallel.
When one component fails, the other takes over
Rs = (Reliability of 1st component) +
{(reliability of 2nd component) x (probability of
needing 2nd component)}

37. Process Management
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A quality product comes from a quality
process
Quality at source
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 The belief that it is best to uncover the source of
quality problems and eliminate it
Managing Supplier quality
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 The philosophy of TQM extends to concept of
quality suppliers and ensures that they engage in
the same quality practices
If suppliers meet quality standards, materials do
not have to be inspected upon arrival

38. Quality Awards and
Standards
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Malcolm Baldrige National Quality
Award
The Deming Prize
ISO 9000 Certification
ISO 14000 Standards

39. MBNQA- What Is It?
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Award named after the former Secretary of
Commerce – Regan Administration
Intended to reward and stimulate quality
initiatives
Given to no more that two companies in each
of three categories; manufacturing, service,
and small business
Past winners; FedEx, 3M, IBM, Ritz-Carlton
Typical winners have scored around 700
points

40. MBNQA Criterion
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Categories
Total Points
Points
2. Leadership 120
3. Strategic Planning 85
4. Customer and Market Focus 85
5. Information and Analysis 90
6. Human Resource Focus 85
7. Process Management 85
8. Business Results 450
1000

41. The Deming Prize
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Given by the Union of Japanese Scientists and
Engineers since 1951
Named after W. Edwards Deming who worked
to improve Japanese quality after WWII
Not open to foreign companies until 1984
Florida P & L was first US company winner

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ISO Standards
 ISO 9000 Standards:
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 Certification developed by International
Organization for Standardization
Set of internationally recognized quality standards
Companies are periodically audited & certified
ISO 9000:2000 QMS – Fundamentals and
Standards
ISO 9001:2000 QMS – Requirements
ISO 9004:2000 QMS - Guidelines for Performance
 More than 40,000 companies have been certified
 ISO 14000:
 Focuses on a company’s environmental
responsibility

43. Why TQM Efforts Fail
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 Lack of a genuine quality culture
 Lack of top management support and
commitment
 Over- and under-reliance on SPC
methods

44. Highlights
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TQM focuses on serving the customer’s quality needs
TQM uses continuous improvement, quality at the
source, employee empowerment, quality tools, teams,
benchmarking, and supplier certification
Four dimensions: product/service design, conformance,
easy of use, post-sale support
Quality costs; prevention, appraisal, internal & external
failures
QFD and Seven Quality Tools used in managing quality
The MBNQA, Deming Prize, and ISO Certification help
focus on quality improvement and excellence
The seven Quality Gurus all made key contributions