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Total Quality Management

Total Quality Management



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Published by Mahanthu

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Published by: Mahanthu on Jul 30, 2009
Copyright:Attribution Non-commercial


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Katerina Stecova Nakia Madry
The challenge for business today is to produce quality product or servicesefficiently. As a result of this, many firms embraced TQM
TQM History
– TQM began in 1970s when Japan had to rebuilt its industrial baseas a result of WWII. With the help of American consultants Edward Deming andJoseph Juran, Japan began making quality as a competitive priority.
Deming believed that quality is the responsibility of the management, notthe worker 
Juran believed that quality depends on continuous improvement, hands-onmanagement, and training
TQM Definition
– a philosophy that stresses three principles – customer satisfaction
employee involvement, and continuous improvements in quality.TQM also involves benchmarking, product and service design, process design, purchasing, and problem solving tools.
Customer Satisfaction
Quality has multiple dimensions in the mind of the customer, and one or more of the following definitions may apply at any one time
Conformance to specification
Customers expect products/services they buy to meet or exceed certainadvertised levels of performance
 Example: quality = if online order comes within specified delivery time
How well the product/service serves its intended purpose at a pricecustomers are willing to pay
Depends on customers’ expectations before purchase
 Example: quality = if a $2 pen serves for a year 
Fitness for use
How well the product/service performs its intended purpose
Based on mechanical features of the product, convenience of service,appearance, style, durability, reliability, craftsmanship, and serviceability
 Example: quality = if it was easy to assemble a desk and if it served well 
Product or service support provided by the company
Good support reduces the consequences in quality failures
 Example: quality = computer repair free of charge
 Psychological impression
Customers evaluate the quality on the basis of atmosphere, image, or aesthetics
 Example: quality = nicely dressed, friendly and sympathetic employees
Katerina Stecova Nakia Madry
Employee Involvement
A complete program in employee involvement includes changing organizationalculture, encouraging teamwork, fostering individual development throughtraining, and establishing awards and incentives
Cultural Change
– if TQM is to be achieved, the organizational culture shouldstress the importance of:
Defining customer for each employees
All employees must do a good job of serving their internalcustomers if external customers are to be satisfied
External – people/firms buying the product/service
Internal – employees in the firm who rely on the output of other employees
Practicing the philosophy of 
“quality at source”
Errors should be caught and corrected at source, not passed alongto an internal customer 
– small groups of people who have a common purpose, set their own performance goals and approaches, and hold themselves accountable for success.
There are three approaches to teamwork 
Problem-solving teams – small groups of supervisors andemployees who meet to identify, analyze, and solve production andquality problems
Special purpose teams – groups that address issues of paramountconcern to management, labor, or both
Self-managing teams – small group of employees who work together to produce a major portion, or sometimes all, of a productor service
 Individual Development 
– on-job training programs help improve quality
Teaching new work methods to experienced workers
Teaching current practices to new employees
Continuous Improvement
Philosophy of continually seeking ways to improve operations, based on aJapanese concept called
 Steps for Achieving Continuous Improvement 
Train employees in the methods of statistical process control and other tools in improving quality and performance
Make SPC method a normal aspect of daily operations
Build work teams and employee involvement
Utilized problem-solving tools within the work teams
Develop a sense of operator ownership in the process
Improving Quality Through TQM
Katerina Stecova Nakia Madry
 Purchasing Considerations
 – successful company with TQM must identifysuppliers with high-quality products/services at a reasonable price because thequality of supplied products/services affects the quality of firm’s work 
 Product/Service Design
 – design changes increase defect rates; therefore, in order to keep quality high, the firm needs to carefully test new designs and redesigns.In addition, while designing or redesigning the product/service, the firm needs tofocus on the market in order to satisfy the customers
 Process Design
 – operations managers must work closely together with designersin the initial phase of product/design to ensure that production requirements and process capabilities are synchronized, which results in a better quality and shorter development time
 – it is a continuous, systematic procedure that measures a firm’s products, services, and processes against those of industry leaders. It is donethrough planning, analysis, integration, and action
 Problem-Solving Tools
– in order to improve the quality of operations, data must be collected and analyzed. This can be done with the help of checklists,histograms, bar charts, pareto charts, scatter diagrams, cause-and-effect diagrams,and graphs
Quality Awards and Standards
 Malcolm Baldridge National Quality Award 
– an award named for the latesecretary of commerce, who was a strong proponent of enhancing quality as ameans of reducing the trade deficit.
The award promotes, recognizes, and publicizes quality strategies andachievements
Up to two awards are given each year in three categories – largemanufacturers, large service companies, and small businesses(manufacturing or service)
Recipients include Motorola, 3M, Federal Express, and Merrill Lynch
 ISO 9000
– a set of standards governing documentation of a quality program
Certified companies indicate to customers that they can providedocumentation to support claims they make about quality
 ISO 14000
documentation standards that required participating companies tokeep track of their raw materials use and their generation, treatment, and disposalof hazardous waste
Example of TQM
 Parkroyal Hotel in New Zeland 
Luxury hotel with 297 guest rooms, three restaurants, three lounges, and338 employees serving 2,250 guests each week 
Prior to guests arrival, reservation staff gathers information about theguest’s likes and dislikes in order to customize the service that each guestsreceives
Receptionists, servers, cooks and other employees live up to thestandards of quality that distinguishes Parkroyal from its competition

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