Department of Public
University of Sindh jamshoro
Cost Of Quality
The Evolution Of Total Quality Management
The Philosophy Of Total Quality Management
Quality Awards & Standards
Total Quality Management Across The Organization
The standard of something
as measured against other
things of a similar kind; the
degree of excellence of
Quality can be quantified as:
Q = P/E
Q = Quality
P = Performance
E = Expectations
The Dimensions of
Quality is divided into two
The Dimensions of
Manufacturing Organizations is
divided into 8 dimensions which
are as follows:
7) Perceived Quality
8) Conformance to Standards
Performance refers to a product's primary operating
characteristics. This dimension of quality involves
measurable attributes; brands can usually be ranked
objectively on individual aspects of performance.
The performance of a product often influences the
profitability or reputation of the end user.
Reliability is the likelihood that a product will not
fail within a specific time period. This is a key
element for users who need the product to work
with out fail. This dimensions reflects the
profitability of a product malfunctioning or
failing within a specific time period.
Durability measures the length of a
product life. When the product can be
repaired, estimating durability is more
The speed with which the product
can be put into service when it
breaks down as well as the
competence & behavior of the
Aesthetics referring to
how the products looks.
For instance, the painted
finish on a piece of
Features are additional characteristics
that enhance the appeal of the product or
service to the user. Similar thinking can
be applied to features, it is a dimension of
quality that is often a secondary aspects
Perceived Quality is the quality attributed to a
good or service based on indirect measures.
An equally important dimension of quality is
the perception of the quality of the product in
the mind of the consumer.
The dimension of Conformance depicts to what
extent a product design & operating characteristics
meet established standards.
DIMENSIONS OF SERVICE
There are 5 Dimensions of Service
Organization or Quality which are
It is the ability to perform the promised
service dependably and accurately.
Reliability means that the company
delivers on its promises-promises about
delivery, service provision, problem
resolutions and pricing. Customers want
to do business with companies that keep
their promises, particularly their
promises about the service outcomes
and core service attributes. All
companies need to be aware of
customer expectation of reliability. Firms
that do not provide the core service that
customers think they are buying fail their
customers in the most direct way.
IT IS THE WILLINGNESS TO HELP CUSTOMERS AND PROVIDE
PROMPT SERVICE. THIS DIMENSION EMPHASIZES ATTENTIVENESS
AND PROMPTNESS IN DEALING WITH CUSTOMER'S REQUESTS,
QUESTIONS, COMPLAINTS AND PROBLEMS. RESPONSIVENESS IS
COMMUNICATED TO CUSTOMERS BY LENGTH OF TIME THEY
HAVE TO WAIT FOR ASSISTANCE, ANSWERS TO QUESTIONS OR
ATTENTION TO PROBLEMS. RESPONSIVENESS ALSO CAPTURES
THE NOTION OF FLEXIBILITY AND ABILITY TO CUSTOMIZE THE
SERVICE TO CUSTOMER NEEDS.
It means to inspire trust and
confidence. Assurance is defined as
employees' knowledge of courtesy and
the ability of the firm and its employees
to inspire trust and confidence. This
dimension is likely to be particularly
important for the services that the
customers perceives as involving high
rising and/or about which they feel
uncertain about the ability to evaluate.
It means to provide caring individualized
attention the firm provide its customers. In
some countries, it is essential to provide
individual attention to show to the customer
that the company does best to satisfy his
needs. Empathy is an additional plus that the
trust and confidence of the customers and at
the same time increase the loyalty.
SINCE SERVICES ARE TANGIBLE, CUSTOMERS DERIVE
THEIR PERCEPTION OF SERVICE QUALITY BY
COMPARING THE TANGIBLE ASSOCIATED WITH THESE
SERVICES PROVIDED. IT IS THE APPEARANCE OF THE
PHYSICAL FACILITIES, EQUIPMENT, PERSONNEL AND
COMMUNICATION MATERIALS. IN THIS SURVEY, ON
THE QUESTIONNAIRE DESIGNED, THE CUSTOMERS
RESPOND TO THE QUESTIONS ABOUT THE PHYSICAL
LAYOUT AND THE FACILITIES THAT THE FIRM OFFERS
TO ITS CUSTOMERS.
Cost of quality Cost of quality = Cost of conformance + Cost of non-
• Cost of conformance is the cost of providing products or services as per the required standards.
This can be termed as good amount spent. (Prevention & Appraisal costs)
• Cost of non-conformance is the failure cost associated with a process not being operated
to the requirements. This can be termed as unnecessary amount spent.( Internal & External
“Prevention cost support activities
whose purpose is to reduce a number
The costs incurred to avoid or
minimize the number of defects at
first place are known as prevention
The most effective way to manage
quality costs is to avoid having
defects in the first place. Much less
costly to prevent a problem from
ever happening than it is to find
and correct the problem after it has
Market survey Quality Audit
Process control Process planning
“Appraisal costs support activities
categories whose purpose is to
determine the of quality degree of
conformance to the quality
Appraisal costs (also known as inspection costs) are
those cost that are incurred to identify defective
products before they are shipped to customers. All
costs associated with the activities that are
performed during manufacturing processes to ensure
required quality standards are also included in this
category. Identification of defective products involve
the maintaining a team of inspectors. It may be very
costly for some organizations.
INTERNAL FAILURE COST
“ The costs of deficiencies discovered before delivery
which are associated with the failure
(nonconformities) to meet explicit requirements or
implicit needs of external or internal customers.”
“ The costs associated with the
deficiencies that is found after product
is received by the customer.”
These are the costs incurred by a
business due to failure of product
or service at the customer end.
These costs results into warranty
claims and loss of reputation.
It is also includes the lost
opportunities for sales revenue.
If defective products have been
shipped to customers, external
failure costs arise.
THE EVOLUTION OF TOTAL QUALITY MANAGEMENT
Total Quality Management (TQM)
comprehensive and structured approach to
organizational management that seeks to
improve the quality of products and services
through ongoing refinements in response to
QUALITY GURUS & THEIR CONTRIBUTION
The quality GURUS have made a significant impact on the world
through their contributions to improving not only business but all
organizations including state & national government military
organizations educational institutions health care organizations & many
other establishments & organizations. There are main seven GURUS of
Total Quality Management (TQM) which are as follows:
Walter A. Shewhart
W. Edwards Deming
Dr. Joseph M. Juran
Armand V. Feiganbaum
Philip B. Crosby
Dr. Genichi Taguchi
WALTER A.SHEWART PHD. Spent his professional career at western electric
& Bell Telephone laboratories. In 1931, he authored Economic control of
quality of manufactured product which is regarded as a complete & thorough
work of basic principles of quality control.
WALTER A. SHEWHART
W. EDWARDS DEMINGS
Edwards Deming, PHD, was a protégé of shewhart, in
1950, he taught statistical process control & the importance
of quality to the leading CEOs of Japanese industry, he is
credited with providing foundation for the Japanese quality
miracle & resurgence as an economic power. Deming is the
best-known quality expert in the world.
There are four ideas of Deming which are as follows:
Better design for products to improve services.
Higher level of uniform product quality.
Improvement of products testing in the workplace & in research centers.
Greater sales through side (global) marketers.
JOSEPH M. JURAN
Worked at western electric from 1924 to 1941.Juran
traveled to japan in 1954 to teach quality management. The
Juan trilogy for managing quality is carried out by three
PLANNING CONTROL IMPROVEMENT
ARMAND V. FEIGANBAUM
PHD argues that total quality control is necessary to achieve
productivity, market penetration & competitive advantage.
Quality begins by identifying the customer requirements
&ends with a product or service in the hands of a satisfied
Kaoru Ishikawa, studied under Deming, Juran & Feigenbaum. He
borrowed the total quality control & adopted it for Japanese. He is
best known for the development of Cause & Effect diagram which
is sometime called an “Ishikawa Diagram” or “Fish Bone Diagram”.
He was known for popularizing the seven basic tools of quality &
philosophy of tool quality.
PHILIP B. CROSBY
Philip B. Crosby was the quality guru that developed the idea of “Quality is
Free” which asserts that implementing quality improvement pays for itself
through the savings from the improvements, increased revenue from
greater customer satisfaction & the improved competitive advantage that
results. He popularized “Zero Defects” to define the goal of a quality
program as the elimination of all defects & not the education of defects to
an acceptable quality level.
Dr. Genichi Taguchi developed his loss function concept that combines
cost target & variation into one metric because the loss function is
reactive. He developed the signal to noise ratio as a proactive equivalent.
He developed the “Taguchi Methodology” of robust design which
focused on making the design less sensitive to variation in the
manufacturing process, instead of trying to control manufacturing
variation. This idea of “Designing in Quality” has become an important
tenant of six sigma today.
The Philosophy of TQM is based on the
following 4 components which are as follows:
Customer focus is an essential part of any
successful business. And that focus has to be
integral to the culture of the business, not
bolted on. Customer service is a series of
activities designed to deliver customer
satisfaction. The process of providing
customer satisfaction is based on an
understanding of what customers want and
Continuous improvement is an
ongoing effort to improve
products, services or processes.
These efforts can seek
“incremental” improvement over
time or “breakthrough”
improvement all at once.
The basic Plan- Do-Study-Act (PDSA) Cycle was developed by
Shewart & then modified by Deming. This is a 4 step process
which is stated as:
STEP # 1:
Plan carefully what is to be done.
STEP # 2:
Carry out the Plan (DO IT).
STEP # 3:
Study the results.
STEP # 4:
Act on the results by identifying what worked as planned & what
Employee empowerment is giving employees a
certain degree of autonomy and responsibility
for decision-making regarding their specific
organizational tasks. Employee empowerment
should lead to increased organizational
responsiveness to issues and problems.
Products are need to be
designed to meet customer
expectations. This means a
company should structure all of
its systems to create products
and services that satisfy its
The Malcolm Baldrige National Quality
The Malcolm Baldrige National Quality
Award was established in 1987 when
Congress passed the Malcolm Baldrige
National Quality Improvement Act. The
award is named after the former
Secretary of Commerce Malcolm
Baldrige, and is intended to reward
and stimulate quality initiatives. It is
designed to recognize companies that
establish and demonstrate high-quality
standards and is given to no more than
two companies in each of three
categories: manufacturing, service,
and small business.
Malcolm Baldrige Quality Award Malcolm Balridge quality
award symbolizes the highest standards of total quality
management. The award is evaluated on the basis of
seven sections in attaining global quality standards .
These sections are:-•
2.Information and analysis
3.Strategic quality planning
4.Human Resource development and management
5.Management of process quality
6.Quality & operational result
7.Customer focus and satisfaction
The Deming Prize is a global quality award that recognizes
both individuals for their contributions to the field of Total
Quality Management (TQM) and businesses that have
successfully implemented TQM.
It is the oldest and most widely recognized quality award in
It was established in 1951 to honor W. Edwards
Deming who contributed greatly to Japan’s proliferation of
statistical quality control after World War II. His teachings
helped Japan build its foundation by which the level of
Japan’s product quality has been recognized as the highest
in the world.
ISO, founded in 1947, is a worldwide
federation of national standards bodies from
some 100 countries, with one standards body
representing each member country. The
American National Standards Institute (ANSI),
for example, represents the United States.
Member organizations collaborate in the
development and promotion of international
standards. Among the standards the ISO
fosters is Open Systems Interconnection (OSI),
a universal reference model for
According to ISO, "ISO" is not an abbreviation.
It is a word, derived from the Greek isos,
The name ISO is used around the world to
denote the organization, thus avoiding the
assortment of abbreviations that would result
from the translation of "International
Organization for Standardization" into the
different national languages of members.
Whatever the country, the short form of the
organization's name is always ISO.
The ISO 9000 family of standards is related to
quality management systems and designed to
help organizations ensure that they meet the
needs of customers and other stakeholders
while meeting statutory and regulatory
International standards promote international
trade by providing one consistent set of
requirements recognized around the world.
ISO 9000 can help a company satisfy its
customers, meet regulatory requirements and
achieve continual improvement. It provides the
base level of a quality system, not a complete
guarantee of quality.
Originally published in 1987 by the
International Organization for Standardization
(ISO), a specialized international agency for
standardization composed of the national
standards bodies of 90 countries.
Explains fundamental quality concepts and provides
guidelines for the selection and application of each standard
Model for quality assurance in design,
development, production, installation and
Model for quality assurance in the production
and installation of manufacturing systems
Quality assurance in final inspection and testing
Guidelines for the applications of standards in quality
management and quality systems.
ISO 9000 and ISO 9004 are guidance standards. They describe what is
necessary to accomplish the requirements outlined in standards 9001,
9002 or 9003.
ISO 14000 is a series of environmental management standards
developed and published by the International Organization for
Standardization ( ISO ) for organizations. The ISO 14000
standards provide a guideline or framework for organizations
that need to systematize and improve their environmental
management efforts. The ISO 14000 standards are not designed
to aid the enforcement of environmental laws and do not
regulate the environmental activities of organizations.
Adherence to these standards is voluntary.
Is an EMS (environmental management system) standard.
Is about environmental labeling.
Series of standards are about Auditing.
Is standard on environmental performance evaluation.
Series are on environmental life cycle assessment (LCA).
TOTAL QUALITY MANAGEMENT ACROSS THE ORGANIZATION
TQM consists of organization-wide efforts to install &make permanent a climate in which an
organization continuously improves its ability to deliver high products & services to
TOTAL QUALITY MANAGEMENT IN MARKETING
Porter’s 1985 description of the value chain of
activities (processes or collection of processes) that
an organization performs in order to deliver a
valuable product or service for the market
TQM IN FINANCE & ACCOUNTING
TQM is the solution for finance & accounting is to apply holistic thinking to
finance applications. The primary measures for a TQM view of finance &
accounting are throughput operating expenses & investment. Throughput is
calculated from sales minus “totally variable cost” where totally variable
cost is usually calculated as the cost of raw materials
TQM IN HRM
HRM is a function of organization design to maximize employee performance in
service of employee strategic objective. HR is primary concerned with the
management of people with in organizations focusing on policies on systems.
HRM covers these areas which are as follows:
Job design & analysis
recruitment & selection
Training & development
Compensation (remuneration) & legal issues.
TQM is the help of these areas to developed high
TQM IN INFORMATION TECHNOLOGY
Advance the business Information Technology over the years,
have changed business processes within & between business
enterprises. In the 1960s operating system holds limited
functionality & any workflow. The 1970s-1980s saw the
development of data driven approaches, as data storage &
retrieval technologies improved. Data modeling rather than
process modeling was the starting point for system
Total Quality Management (TQM) is
the art of managing the whole to
achieve the excellence. TQM integrates
fundamental management techniques,
existing improvements efforts &
technical tools under a disciplined