Total Quality Management.pdf

for BBA and Commerce students

1. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
CHAPTER 1
Introduction
Total Quality Management (TQM)
It is an enhancement to the traditional way of doing business.
Total: made up of whole.
Quality: degree of excellence a product or service provides.
Management: an art, science and manner of handling, controlling, directing
etcetera.
Basic Approach—TQM requires Six basic Concepts
1-A committed and involved management to provide long-term top to bottom
organizational support: management must participate in the quality program,
quality improvement teams and also act as coaches to other teams. A quality
council must be established to develop a clear vision, set long-term goals, and
direct the program. TQM is continual activity and must be communicated to all
people.
2-Focus on Customer: effective TQM program is its focus on the customer. We
must listen to the “voice of the customer” and emphasize design quality and defect
prevention, do it right the first time and every time, for customer satisfaction is
important consideration.
3-Effective involvement and utilization of the entire workforce: all personnel
must be trained in TQM and other appropriate quality improvement skills so they
can effectively participate on project teams. Those affected by the plan must be
involved in its development and implementation. People must come to work not
only to do their jobs, but also to think about how to improve their jobs.
4-Continuous improvement of business and production process: Quality
improvement projects, such as on-time delivery, order entry efficiency, billing
error rate, customer satisfaction, cycle time, scrap reduction, and supplier
management, are good places to begin. Technical techniques such as SPC,
benchmarking, quality function development, ISO 9000, and designed experiments
are excellent for problem solving.
5-Treating suppliers as partners: On the average 40% of the sales dollar is
purchased product or service, therefore the supplier quality must be outstanding.
Both parties have as much to gain or lose based on the success or failure of the

2. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
product or service. Focus should be on quality or life-cycle costs rather than price
and supplier should be few in number as true partnering can occur.
6-Establish performance measure for process: Performance measures such as
uptime, percent nonconforming, absenteeism, and customer satisfaction should be
determined for each functional area. These measures should be posted for everyone
to see. Quantitative data are necessary to measure the continuous quality
improvement activity.
New and Old Culture
Quality Element Previous State TQM
Definition Product Oriented Customer-oriented
Priorities Second to service and
Cost
First among equals of
service and Cost
Decisions Short-term Long-term
Emphasis Detection Prevention
Errors Operations System
Responsibility Quality Control Everyone
Problem Solving Managers Teams
Procurement Price Life-cycle costs,
partnership
Manager’s Role Plan, assign, control,
enforce
Delegate, coach,
facilitate, mentor

History of Total Quality Management or Gurus in TQM
Shewhart (1891 to 1967)
Walter A. Shewhart, PhD, spent his professional career at Western Electric and
Bell Telecommunication phone laboratories, both division of AT & T. He
developed control chart theory with control limits, assignable and chance causes of
variation, and rational subgroups. In 1931, he authored Economic Control of
Quality of Management Product, which regarded as a complete and thorough work
of the basic principles of quality control. He also developed the Plan, Do, Check,
Act (PDCA) cycle for learning and improvement.

Deming (1900 to 1993)
W. Edwards Deming, PhD. In 1950, he taught statistical process control and the
importance of quality to the leading CEOs of Japanese Industry. Deming is best-

3. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
known quality expert in the world. His 14 points provide theory for management to
improve quality, productivity, and competitive position. He has authored a number
of books including Out of The Crisis and Quality, Productivity, and Competitive
Position as well as 161 scholarly studies.

Juran
Joseph M.Juran PhD worked at Western Electric from 1924 to 1941. Juran
Travelled to Japan in 1954 to teach quality management. He recommended project
improvements based on return on investment to achieve breakthrough results. The
Juran Trilogy for managing quality is carried out by the three interrelated processes
of planning, control, and improvement. In 1951, the first edition of Juran’s Quality
Control Handbook was published.

Feiganbaum
Armand V. Feiganbaum, PhD, argues that total quality control is necessary to
achieve productivity, market penetration, and competitive advantage. Quality
begins by identifying the customer’s requirements and ends with a product or
service in the hands of a satisfied customer. In addition to customer satisfaction,
some of Feiganbaum’s quality principles are genuine management involvement,
employee involvement, first-line supervision leadership, and company-wide
quality control. In 1951, he authored Total Quality Control.

Ishikawa
Kaoru Ishikawa, PhD, studied under Deming, Juran, and Feiganbaum. He
borrowed total quality control concept and adapted it for the Japanese. In addition,
he authored SPC texts in Japanese and in English. He is best-known for the
development of the cause and effect diagram, which is sometimes called an
Ishikawa diagram. He developed the quality circle concept in Japan, whereby work
groups, including their supervisor, were trained in SPC concepts. The groups then
met to identify and solve quality problems in their work environment.

Crosby
Philip B. Crosby authored his first book, Quality is Free, in 1979, which was
translated into 15 languages and sold 1.6 million copies. He argued that “doing it
right the first time” is less expensive than the costs of detecting and correcting
nonconformities. These absolutes are: quality is conformance to requirements,
prevention of nonconformance is the objective not appraisal, the performance

4. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
standard is zero defects not “that’s close enough,” and the measurement of quality
is the cost of nonconformance.

Taguchi
Genichi Taguchi, PhD, developed his loss function concept that combines cost,
target, and variation into one metric. Because the loss function is reactive, he
developed the signal to noise ratio as proactive equivalent. The cornerstone of
Taguchi’s philosophy is the robust design of parameters and tolerances. It is built
on the simplification and use of traditional design of experiments.
Chain Reaction
In 1950, Chain Reaction became helpful to understand importance of quality.

















Improve Quality

Cost decrease due to fewer defects, leaser rework, fewer delays and better use
of man, machine, and materials.

Improved Productivity

Capture market will better quality and lower Prices

Stay in Business

Provide More Jobs

5. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
Quality Control: The operational techniques activities that are used to fulfill the
requirement for quality.
Quality Assurance: All the planned and systematic activities, implemented
within, the quality system and demonstrated as headed to provide adequate
confidence that an entity will fulfill the requirement for quality.
The purpose of Quality Assurance is to fulfill the quality requirement of an entity.
Quality Control is subpart of Quality Assurance.
Quality Planning: It is subpart of quality assurance.
Quality Improvement: It is continuous enhancement in the quality.
Quality Management: All activities of the overall management function that
determine the quality, policy, objectives and responsibilities and implement them
by means such as quality planning, quality control, quality assurance and quality
improvement within the quality system.
Building Quality into the products required the following
1. Quality of Design
2. Quality of Conformance
3. Quality of Performance
4. Quality of Services
Quality Planning involves the planning of the:
a) Quality of objectives to be met.
b) Specific of Quality Assurance and control practices.
c) Resources needed.
d) Sequence of Quality Assurance and control activities
Dimensions of Quality
Product Quality Service Quality
Functionality Quality of Customer Service
Reliability Quality of services design
Usability Quality by delivery
Maintainability Timeliness
Efficiency Aesthetics
Problem Regulatory requirement
Conformance to standard

6. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
Requirement for society

Historical Review
The history of quality control is undoubtedly as old as industry itself. This training
instilled pride in workers for quality of a product. The concept of specialization of
labor was introduced during the industrial Revolution. As a result, a worker no
longer made the entire product on a portion. During that period were not
complicated, quality was not greatly affected. As products became more
complicated and jobs more specialized, it became necessary to inspect products
after manufacture. In 1924, W.A. Shewhart of Bell Telephone Laboratories
developed a statistical chart for the control of product variables. In 1946, the
American Society for Quality Control was formed. Recently, the name was
changed to American Society for Quality (ASQ). 1960, the first quality control
circles were formed for the purpose of quality improvement. By the middle of
1980 the concepts of TQM were being publicized. In the late 1980s the automotive
industry began to emphasize statistical process control. The Malcolm Baldrige
National Quality Award was established and became the means to measure TQM.
Genechi Taguchi introduced his concepts of parameter and tolerance design and
brought about a design of experiments as valuable quality improvement tool.
Emphasis on quality continued in the auto industry in the 1990s when the Saturn
automotive ranked first in customer satisfaction (1996). In addition, ISO 9000
became the worldwide model for a quality management system, ISO 14000 was
approved as the worldwide for environmental management system.
Obstacles In Implementation of TQM
1-Lack of Management Commitment: there must be a substantial management
commitment of management time and organizational resources. The purpose must
be clearly and continuously communicated to all workers and employees;
management must consistently apply the principles of TQM.
2-Inability of Change Organizational Culture: management must understand and
utilize the basic concepts of change, like people change when they want to and
have need.
3-Improper Planning: all the employees and management must be involved in the
development of the implementation plan and any changing that occur as the plan
needs. Customer satisfaction should be the goal rather than financial or sales goals.

7. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
4-Lack of continuous Training and Education: training and education is an
ongoing process for everyone in the organization. training and education are most
effective when senior management conducts the training on the principles of TQM.
5-Incompatible Organizational Structure and Isolated Individual and
Departments: difference between departments and individuals can create
implementing problems. The use of multifunctional teams will help to break down
long-standing barriers. Restructuring to make the organization more responsive to
customer needs may leave the organization.
6-Ineffective Measurement Techniques and Lack of Access to Data and
Results: key characteristics of the organization should be measured so that
effective decisions can be made. In order to improve a process, you need to
measure the effect of improvement ideas. Access to data and quick answers is
necessary for effective processes.
7-Paying Inadequate Attention to Internal and External Customers: organization
need to understand the changing needs and expectations of their customer.
Effective feedback mechanism that provide data for decision making are necessary
for this understanding.
8-Inadequate Use of Empowerment and Teamwork: individual should be
empowered to make the decision that affect the efficiency of their process or the
satisfaction of their customer.
9-Failure of Continually Improve: a lack of continuous improvement of the
processes, product or service will even leave the leader of the pack in the dust. Will
Rogers said it best, “Even if you are on the right track, you will get run over if you
just sit there.”
Quality means Cost Effectiveness
Cost of Quality (COQ)

8. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
CHAPTER 2—Leadership
Definition (Leader)
James MacGregor Burns describes “a leader as one who instills purposes, not one
who controls by brute forces.”

• Characteristics of Quality Leader
• The 7 Habits of Highly Effective People
• Elements of TQM
• Ethics in TQM
• Ethical Management Program
• The Deming Philosophy
• Ten Strategies for Top Management
CHAPTER 3—Customer Satisfaction
• Traditional View
• Modern View
• Taboul Model
• PDSA implementation in TQM
• Customer and its types (internal and external)
• Customer Perception of Quality
• Customer Feedback
• D.H Stamatis COMFORT
CHAPTER 4—Employee Involvement
• Motivation
• Haslow’s Hierarchy of Needs
• Herzberg’s Two-Factor Theory
• X ,Y and Z Theory

9. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
• Team work
• Communication
• Training and mentoring
• Recognition and Reward
• Feedback and Performance appraisal
• Empowerment
Chapter 5—Continuous Process Improvement
• Process
• Input/Out Process Model
• Entry-Task-Exit (EXT) Model*
• Subhuraj’s 6s Model for Process Improvement*
• Supply Chain Management (SCM)*
• Major 4 cases of SCM*
• The Juran Trilogy
• Improvement Strategies
• The PDSA Cycle
• Problem Solving Method
• Kaizen
Chapter 6—Supplier Partnership
• Principles of Customer/Supplier Relations
• Partnering
• Supplier Selection
• Supplier Standards
1. Quality
2. Preventing defects

10. Total Quality Management Prof. Saima Tabassum
Composed by: Seetal Daas University of Sindh Laar Campus, Badin
BBA(Hons)-2k13
([email protected])
3. Built-in Quality
4. Delivery
5. Reliable Delivery
6. Flexible Delivery
7. Technology
8. Payment Terms
• Relationship Development
• Supplier Rating
1. Quality*
2. Price*
3. Delivery*
4. Services*
Problems: Quality Rating, Price Rating, Delivery Rating.*
Chapter 7—Benchmarking
• Benchmarking
• Concept of benchmarking
• Triggers for benchmarking
• Types of benchmarking
• Benchmarking Process
Chapter 10—Quality Management System (assignment)