QM Final

Quality Management
Kenya Institute of Management

Stanley Cheruiyot
2011/2012
Quality Management
Prepared By: Stanley Cheruiyot
Contents
Contents...............................................................................................................................................2 QUALITY MANAGEMENT..............................................................................................................5 TOPIC 1: SOCIETY AND ITS INSTITUTIONS..........................................................................5 Introduction..................................................................................................................................5 Quality and Quality Management................................................................................................7 Principles of Quality Management..............................................................................................7 The Role of Society in Sustaining Quality Practices.................................................................11 Government................................................................................................................................11 Citizens/Consumers...................................................................................................................12 Civil Society...............................................................................................................................12 Employees .................................................................................................................................12 Management...............................................................................................................................13 Stakeholders (Anybody who has interest).................................................................................13 Media.........................................................................................................................................13 Impact of Quality Services on Institutions/Society...................................................................13 TOPIC 2: QUALITY AND THE ENVIRONMENT....................................................................15 Environmental Policies on Quality Management......................................................................15 Environmental Management Systems .......................................................................................16 Business and Environment.........................................................................................................16 Basic Concepts of Environmental Management........................................................................16 ISO 14000 Family of Standards.................................................................................................17 Benefits of Implementing ISO 14000 EMS ..............................................................................18 Topic 3: WORKPLACE CULTURE.............................................................................................23 Culture and Quality Paradigm...................................................................................................23 Workplace Culture and Quality.................................................................................................24 Importance of Culture to Quality Management.........................................................................25 History of Quality Management Paradigms..............................................................................26 Workplace Ergonomics and Quality..........................................................................................29 TOPIC 4: QUALITY MANAGEMENT AND LAW...................................................................30 Legal aspects in enforcing quality practices..............................................................................30 Business laws governing supply of goods and services.............................................................31 Quality and Product Liability.....................................................................................................33 Enforcement of Quality Laws in Kenya....................................................................................34 TOPIC 5: UNDERSTANDING COMPLEXITY IN QUALITY..................................................35 Systems Approach to Quality....................................................................................................41 Effects of Complex Systems on Management of Quality..........................................................43 Integrating organization structure and quality...........................................................................44 Quality Management and Organizational Productivity.............................................................46 TOPIC 6: THE MEDIA ON PUBLIC PERCEPTION..................................................................47 TOPIC 7: ORGANIZATIONS SELF-CONCEPT.......................................................................51 Self Perception and Quality.......................................................................................................51 Self Esteem ...............................................................................................................................53 Topic 8: COMMITMENT AND LEADERSHIP IN QUALITY MANAGEMENT....................54 Quality and Competitiveness.....................................................................................................55 Quality Chains...........................................................................................................................56 Managing Quality Processes......................................................................................................57 Commitment and Policy in Quality Management.....................................................................58 Policies.......................................................................................................................................59 2
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....................................................................................................................................................60 Topic 9: Historical Perspectives to Quality Management.............................................................60 The Evolution of Quality Management.....................................................................................60 The Elements of Total Quality Management.............................................................................63 Quality Gurus.............................................................................................................................67 Juran's QualityTrilogy. ..............................................................................................................74 Crosby's Cost Of Quality. .........................................................................................................75 Crosby's Four Absolutes of Quality. .........................................................................................75 Topic 10: The Future Quality Management...................................................................................83
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Chance Favors the Prepared Mind- Marie Sklodowska Curie (1867-1934)
Quality Management
QUALITY MANAGEMENT
TOPIC 1: SOCIETY AND ITS INSTITUTIONS
Introduction
A society is a group of individuals sharing the same behavior and environment. It is groups bound together by social, political, economic, cultural ecological/technical factors. The groups of individuals are unified by a common objective to be attained. Such objectives includes profits, harmony leadership etc. In any given society, there are institutions created to form a framework/the structure of the society. Such institutions include cultural, political social and economic & Business institutions. These societies are bound by ideological components which consist of ideas, values and beliefs which will define and shape the type of organization. What is an Organization? An entity where two or more persons work together to achieve a goal or a common purpose is called Organization. There are so many organizations around us. Daily we visit and see many organizations including hospitals, colleges, factories, farms and Government offices. Mosque/Church is also an example of an organization. People go there and say prayers. Activities of praying are to achieve a certain goal. Similarly, any unit in which two or more persons are working together for some purpose is called an organization. Unit of Organization: People Purpose Process POLCA If there is an organization, then there must be some people. They work as whole for a common purpose, so there must be a defined purpose. If an organization doesnt have any purpose, it will not survive for long run. To achieve the purposes by using people, the processes are needed. Without any process, you cannot achieve any type of purpose or goal. If we see in our daily life, we have some goals. For achieving these goals, we use some processes. So that process is also obvious and important for an organization. The last important thing for any organization is that it requires main pillars of management I.e. POLCA: Planning 5
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Organizing Leading Controlling A business (also known as enterprise or firm) is an organization designed to provide goods, services, or both to consumers. Businesses are predominant in capitalist economies, in which most of them are privately owned and formed to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit or state-owned. A business owned by multiple individuals may be referred to as a company, although that term also has a more precise meaning. It is a sum total of all those activities carried out by the enterprise to produce market goods and services with the objective of earning profits through satisfaction of human wants .It is worthy to note that business although created to generate profits may actually make losses! Business Environment A business does not function in a vacuum. It has to act and react to what happens outside the factory and office walls. These factors that happen outside the business are known as external factors or influences. These will affect the main internal functions of the business and possibly the objectives of the business and its strategies. Main Factors The main factor that affects most business is the degree of competition how fiercely other businesses compete with the products that another business makes. The other factors that can affect the business are: Social how consumers, households and communities behave and their beliefs. For instance, changes in attitude towards health, or a greater number of unemployed youth in a population. Legal the way in which legislation in society affects the business. E.g. changes in employment laws on working hours. Economic how the economy affects a business in terms of taxation, government spending, general demand, interest rates, exchange rates and regional and global economic factors. Political how changes in government policy might affect the business e.g. a decision to subsidize building new houses in an area could be good for a local brick works. Technological how the rapid pace of change in production processes and product innovation affect a business. Ethical what is regarded as morally right or wrong for a business to do. For instance should it trade with countries which have a poor record on human rights? Changing External Environment Markets are changing all the time. It does depend on the type of product the business produces, however a business needs to react or lose customers. 6
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Some of the main reasons why markets change rapidly: Customers develop new needs and wants and better quality offering New competitors enter a market. New technologies mean that new products can be made. Government introduces new legislation e.g. increases minimum wage.
Quality and Quality Management

Although quality and quality management does not have a formal definition, most agree that it is an integration of all functions of a business to achieve high quality of products through continuous improvement efforts of all employees. Quality revolves around the concept of meeting or exceeding customer expectation applied to the product and service. Achieving high quality is an ever changing, or continuous, process therefore quality management emphasizes the ideas of working constantly toward improved quality. It involves every aspect of the company: processes, environment and people. The whole workforce from the CEO to the line worker must be involved in a shared commitment to improving quality. Therefore, in brief, quality and quality management in particular can be defined as directing (managing) the whole (total) production process to produce an excellent (quality) product or service. It differs from other management techniques in the attitude of management toward the product and toward the worker. Older management methods focused on the volume of production and the cost of the product. Quality was controlled by using a detection method (post production inspection), problems were solved by management and management's role was defined as planning, assigning work, controlling the production. Quality management, in contrast, is focused on the customer and meeting the customer's needs. Quality is controlled by prevention, i.e., quality is built in at every stage. Teams solve problems and everyone is responsible for the quality of the product. Management's role is to delegate, coach, facilitate and mentor.
Principles of Quality Management

Quality management is becoming increasingly important to the leadership and management of all organisations. It is necessary to identify Quality Management as a distinct discipline of management and lay down universally understood and accepted rules for this discipline.
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The ISO technical committee working on the ISO9000 standards had published a document detailing the quality management principles and application guidelines. The latest revision (version 2008) of ISO 9000 standards are based on these principles.
Definition of Quality Management Principle: "A quality management principle is a comprehensive and fundamental rule / belief, for leading and operating an organisation, aimed at continually improving performance over the long term by focusing on customers while addressing the needs of all other stake holders". The eight principles are... 1. Customer-Focused Organisation 2. Leadership 3. Involvement of People 4. Process Approach 5. System Approach to Management 6. Continual Improvement 7. Factual Approach to Decision Making and 8. Mutually Beneficial Supplier Relationships. Now let us examine the principles in detail. Principle 1 - Customer-Focused Organisation : "Organisations depend on their customers and therefore should understand current and future customer needs, meet customer requirements and strive to exceed customer expectations". Steps in application of this principle are... Understand customer needs and expectations for products, delivery, price, dependability, etc. Ensure a balanced approach among customers and other stake holders (owners, people, suppliers, local communities and society at large) needs and expectations. Communicate these needs and expectations throughout the organisation. Measure customer satisfaction & act on results, and Manage customer relationships.
Principle 2 - Leadership: "Leaders establish unity of purpose and direction of the organisation. They should create and maintain the internal environment in which people can become fully involved in achieving the organisation's objectives." Steps in application of this principle are... Be proactive and lead by example. 8
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Understand and respond to changes in the external environment. Consider the needs of all stake holders including customers, owners, people, suppliers, local communities and society at large. Establish a clear vision of the organisation's future. Establish shared values and ethical role models at all levels of the organisation. Build trust and eliminate fear. Provide people with the required resources and freedom to act with responsibility and accountability. Inspire, encourage and recognise people's contributions. Promote open and honest communication. Educate, train and coach people. Set challenging goals and targets, and Implement a strategy to achieve these goals and targets.
Principle 3 - Involvement of People: "People at all levels are the essence of an organisation and their full involvement enables their abilities to be used for the organisation's benefit". Steps in application of this principle are... Accept ownership and responsibility to solve problems. Actively seek opportunities to make improvements, and enhance competencies, knowledge and experience. Freely share knowledge & experience in teams. Focus on the creation of value for customers. Be innovative in furthering the organisations objectives. Improve the way of representing the organisation to customers, local communities and society at large. Help people derive satisfaction from their work, and Make people enthusiastic and proud to be part of the organisation.
Principle 4 - Process Approach: "A desired result is achieved more efficiently when related resources and activities are managed as a process." Steps in application of this principle are... Define the process to achieve the desired result. Identify and measure the inputs and outputs of the process. Identify the interfaces of the process with the functions of the organisation.
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Evaluate possible risks, consequences and impacts of processes on customers, suppliers and other stake holders of the process. Establish clear responsibility, authority, and accountability for managing the process. Identify internal and external customers, suppliers and other stake holders of the process, and When designing processes, consider process steps, activities, flows, control measures, training needs, equipment, methods, information, materials and other resources to achieve the desired result.
Principle 5 - System Approach to Management: "Identifying, understanding and managing a system of interrelated processes for a given objective improves the organisation's effectiveness and efficiency." Steps in application of this principle are... Define the system by identifying or developing the processes that affect a given objective. Structure the system to achieve the objective in the most efficient way. Understand the interdependencies among the processes of the system. Continually improve the system through measurement and evaluation, and Estimate the resource requirements and establish resource constraints prior to action.
Principle 6 - Continual Improvement: "Continual improvement should be a permanent objective of the organisation." Steps in application of this principle are... Make continual improvement of products, processes and systems an objective for every individual in the organisation. Apply the basic improvement concepts of incremental improvement and breakthrough improvement. Use periodic assessments against established criteria of excellence to identify areas for potential improvement. Continually improve the efficiency and effectiveness of all processes. Promote prevention based activities. Provide every member of the organisation with appropriate education and training, on the methods and tools of continual improvement such as the Plan-Do-Check-Act cycle, problem solving, process re-engineering, and process innovation. Establish measures and goals to guide and track improvements, and Recognize improvements.
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Principle 7 - Factual Approach to Decision Making: "Effective decisions are based on the analysis of data and information." Steps in application of this principle are... Take measurements and collect data and information relevant to the objective. Ensure that the data and information are sufficiently accurate, reliable and accessible. Analyse the data and information using valid methods. Understand the value of appropriate statistical techniques, and Make decisions and take action based on the results of logical analysis balanced with experience and intuition. Principle 8 - Mutually Beneficial Supplier Relationships: "An organisation and its suppliers are interdependent, and a mutually beneficial relationship enhances the ability of both to create value." Steps in application of this principle are... Identify and select key suppliers. Establish supplier relationships that balance short-term gains with long-term considerations for the organisation and society at large. Create clear and open communications. Initiate joint development and improvement of products and processes. Jointly establish a clear understanding of customers' needs. Share information and future plans, and Recognize supplier improvements and achievements.
The Role of Society in Sustaining Quality Practices

Quality should always be everybodys responsibility within the society. Each institution therefore should be an agent that advocate for better quality goods and services in order to create better living standards. Each group within the society has a distinct role in developing and sustaining a quality system. Some of the specific institutions include:
Government.
Being the appointed authority to provide services to citizens, the business of the government of the day is having the interest of citizens at heart. Their main role include Providing legislative framework that creates a system roving quality services Establish and empower institutions that are to enforce quality improvements/Protection efforts e.g. N.E.M.A ( National Environment Management Authority) To promote the use of quality practices in production of goods and services in an economy. 11
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To set up institutions that monitors and promotes the development of new technologies in product service provision To encourage the use of quality oriented technologies by setting up special entities that promotes such practices To enforce rules and regulations that advocates for quality utilization of natural resources
Citizens/Consumers.
Being the biggest entity in the society and the consumer of goods and services produces in an economy, they are entrusted with the following roles To demand for better quality goods and services at all times To provide the necessary information about their quality preference to the government and producers of goods and services To propose new approaches to the government and producers on quality improvement and value enhancement To make informed quality based decisions regarding the product and services that they consume e.g. low cholesterol diet foods.
Civil Society
This is a social entity that advocates for the vulnerable in the society. Being an advocate, they are required to mobilize social interest so as to fight for their rights. Their role includes To act on behalf of the vulnerable group to protect their interest and rights Organize for effective representation at the various levels of decision making To educate the public on the importance of quality products and services and the use of quality practices. To mobilize resources in order to support programs directed towards better quality
Employees
Being members of a business entity, employees are requires to play the following roles: To act at all times with full interest to provide quality products and services. To work with the management towards improving their work environments To support the organization by contributing ideas and creativity that leads to production of better quality goods and services. To endeavor to improve their skills by acquiring the necessary knowledge and expertise through continuous training and empowerment. To inhibit any unethical practices used by the organization and always advocate for quality practices. 12
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Management
Based on the authority entrusted on the management, they are required to play the following roles: To adopt management practices that advocate for quality systems and procedures e.g. Adoption of ISO certification such ISO 14000 for Environment Management System (E.M.S) To provide the necessary leadership that is quality focused. Allocate resources towards the development and enhancement of practices that support quality. To be a leader of change by setting roles that are quality oriented and improvement focused. To develop and enhance quality culture within the organization by providing the necessary cultural framework that is built on quality.
Stakeholders (Anybody who has interest)

Being the group that has direct/indirect interest in the entity, their role in quality enhancement will include the following To impose on the entity the need to use ethical and quality practices To provide ideas and information to the management board that promotes the use of quality practices To ensure that quality sustainability interest are put ahead of financial gains To demand for accountability in quality services by business organization.
Media
Being an information provider and source of knowledge, the media should play the following roles Disseminate information that supports quality systems To provide information on new technologies To educate the public on their rights regarding quality of products/services they consume To adequate and unbiased information about quality issues To expose any non-quality/non-ethical practices.
Impact of Quality Services on Institutions/Society

Quality is a strategic factor that works through cycles and systems with its effect self evident on institutions within the society. Good/poor products/service will have a direct impact on entities through several ways including: A) The Organization/Business 13
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Increased customer satisfaction Enhances profitability Lower costs Enhanced competitiveness Improved responsiveness to organizations environment and customer requirements Reduces legal liabilities Improved reputation of the organization Less wastage Increased morale Increased productivity Enhances their interest on the job It provides them with an avenue of being good corporate citizens Provides and promote a positive culture and responsibility It allows procreation of better quality goods and services Better utilization of resources Improved quality of life Protecting the society against harmful practices Enhances value creation Creation of employment They will receive better quality goods and services Better living standards Higher value for money Protection against exploitation and harm Protection against harmful environmental hazards
B) Employees
C) The Society
D) The Consumer
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TOPIC 2: QUALITY AND THE ENVIRONMENT

Environmental Policies on Quality Management
The intent of an environmental policy is to state the organizations commitment to continuous improvement in environmental performance. A strong, clear environmental policy can serve as both a starting point for developing the Environment Management System and a reference point for maintaining continuous improvement. The policy should be evaluated regularly and modified, as necessary, to reflect changing environmental priorities. The policy should function in two ways: (1) within the company, the policy should focus attention on environmental issues associated with company activities, products, and services; and (2) outside the company, the policy is a public commitment to addressing environmental issues and continuously improving environmental performance. The environmental policy must address: Commitment to compliance with relevant environmental legislation and regulations Pollution prevention Continuous improvement Tips for Developing an Environmental Policy: 1. Develop a policy that reflects perspectives of various employees within the company (for example, line worker, owner, wastewater treatment operator, quality inspector, compliance/legal manager, production manager). 2. Display the policy statement in view of all employees; the policy should be available to the public and customers if requested and be printed in languages other than English, as appropriate. 3. Include top management signatures on the policy to demonstrate understanding and commitment. Environmental Policy Example The E.P.ZA (The Export Processing Zones Authority)
The Export Processing Zones Authority (EPZA) is an investment promotion agency of the Kenya government responsible for catalyzing export oriented investments in economic zones. At EPZA we recognize our responsibility for protection of the environment. To meet this commitment, we shall: Control our services and operational activities in order to minimize their negative environment impacts. Comply with relevant applicable environmental laws and other requirements that apply to the activities of the Organisation.
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Set up and strive to achieve our environmental objectives and targets. These targets shall be monitored and periodically reported for review. To train and motivate members of the staff to carry out their tasks in an environmentally responsible manner. Continuously improve our environmental performance by minimizing pollution, adopt waste management best practice, and minimize water and energy use. Achieve these by establishing, implementing and maintaining effective processes for environmental management as required by ISO 14001:2004 Environmental Management System.
SIGNED: JOSEPH N. KOSURE AG. CHIEF EXECUTIVE OFFICER
Environmental Management Systems

Environmental Management: Environmental Management is not, as the phrase could suggest, the Management of the environment as such but rather the management of man's interaction with and impact upon the environment. The need for environmental management can be viewed from a variety of perspectives. Environmental management is therefore not the conservation of the environment solely for the environments sake but rather the conservation of the environment for human kinds sake. As with all management functions, effective management tools, standards and systems are required. An 'environmental management standard or system or protocol attempts to reduce environmental impact as measured by some objective criteria. The ISO 14001 standard is the most widely used standard for environmental risk management.
Business and Environment

All kinds of businesses are directly or indirectly related with the environment. It is generally agreed that environmental sustainability must be build on long-term economic and social sustainability and that the challenge of sustainable development requires integration of economy and environment in all sectors and at all levels. The objectives of private sector led economic growth in a globally competitive world are not necessarily compatible with the state and community led objectives of social equity and environmental protection. If one can properly apply the environmental management system in business, the business could be benefited by several ways. Such as: Cost savings. Minimized commercial risks and liabilities Improved competitive advantage Improved employee satisfaction
Basic Concepts of Environmental Management

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Man-made changes in the environment have continued through most historical epochs. However, the last two centuries following the industrial revolution have witnessed accelerated environmental changes due to the exploitation of natural resources on an unprecedented scale. Extensive burning of fossil fuels, release of various chemical pollutants into the air, the water and soil, clearing of forests for agriculture and extensive exploitation of all natural resources are now threatening to destroy the very environment on which human existence depends. Fortunately, awareness of environmental problems is growing in most countries of the world. It is felt by many people that to continue development patterns that cannot be sustained in the long term is a recipe for disaster. Governments are now listening more to the advice of environmentalists and increasingly enacting legislation aiming at protecting the environment from the negative impacts of economic activities. However, the enforcement of environmental legislation is proving to be difficult in most cases. A new approach to environmental protection is now available thanks to the development of new international standards on environmental management, in particular, ISO 14001. This approach relies less on command-and-control dictates from the Government and more on proactive efforts by all workers in the company. The implementation of the environmental management system prescribed by ISO 14001 can lead to good compliance with environmental legislation and tangible, continual improvement in the environmental performance of enterprises thanks to the commitment and evolvement of top management and all workers. Widespread implementation of these standards can go a long way toward improving the environmental performance of industry and promoting sustainable development in the countries of the world.
ISO 14000 Family of Standards

ISO 14000 is a group of standards covering the following areas: Environmental Management Systems (14001,14002, 14004) Environmental Auditing (14010, 14011, 14012) Evaluation of Environmental Performance (14031) Environmental Labeling (14020, 14021, 14022, 14023, 14024, 14025) Life-Cycle Assessment (14040, 14041, 14042, 14043)
ISO 14001 is the only standard intended for registration by third parties. All the others are for guidance. ISO 14001 is a management standard, it is not a performance or product standard. The underlying purpose of ISO 14001 is that companies will improve their environmental performance by implementing ISO 14001, but there are no standards for 17
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performance or the level of improvement. It is a process for managing company activities that impact the environment. Some unique and important characteristics of ISO 14001 are: It is comprehensive: all members of the Organization participate in environmental protection, the environmental management system considers all stakeholders, and there are processes to identify all environmental impacts. It is anticipative: it focuses on forward thinking and action instead of reacting to command and control policies. It is a systems approach: it stresses improving environmental protection by using a single environmental management system across all functions of the Organization. The Environmental Management System contains the following elements: Identification of environmental aspects and significant impacts. Identification of legal and other requirements. Environmental goals, objectives, and targets that support the policy. An environmental management program. Definition of roles, responsibilities, and authorities. Training and awareness procedures. Process for communication of the EMS to all interested parties. Document and operational control procedures. Procedures for emergency response. Procedures for monitoring and measuring operations that can have a significant impact on the environment. Procedures to correct nonconformance. Record management procedures. A program for auditing and corrective action. Procedures for management review.
Benefits of Implementing ISO 14000 EMS

Environmental Management Systems (EMS) is the foundation of the ISO 14000 group of international environmental management standards. An EMS can be registered as meeting the ISO 14001 EMS standard. Since the ISO 14001 EMS includes everyone in the Organization and all aspects of the Organization that affect the environment, it can improve an organization's environmental
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performance in many ways. This improved performance comes at a cost to the Organization, a cost that can be recovered by aggressively seeking benefits. The benefits of an EMS and registration of the EMS to ISO 14000 are organized into the following categories: Increased Profits Operations Marketing Regulatory Compliance Social
The benefits gained in each category are briefly described below. Increased Profits Implementing ISO 14001 today can provide a basis for implementing the other standards in the ISO 14000 series. This incremental approach can reduce overall costs to implement ISO 14000 because of lessons learned in each phase. The quantity of materials and energy required for manufacturing a product may be reduced, thereby reducing the cost of the product, material handling costs, and waste disposal costs. Some companies have found that it costs more to run a compliance-driven system than an EMS An EMS can help reduce incidents of pollution and the associated expense of recovery. Recycling manufacturing waste and unused inputs could increase revenues. Recycling need not be within the same facility, but with another one that can use the waste as input to their production. Employee health and safety can be improved, thereby improving productivity, decreasing sick days, and reducing insurable risk. Insurance claims may be reduced, thus reducing the costs of coverage and settlements. Meeting the standards of different countries can be expensive. ISO 14000 can reduce this effort by providing one standard Operations The EMS standards can define "best practices" and create a foundation for the next level of improvement. An EMS integrated with all other business systems improves management's ability to understand what is going on in their Organization, determine the effect on the company, and provide leadership.
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The standards build consensus throughout the world that a common terminology for environmental management systems is needed. A common terminology for all locations of a multinational Organization will increase efficiency of communication and improve results. An EMS can identify instances of redundancy in day-to-day efforts for regulatory compliance. These can be eliminated, thus making the Organization more efficient. An EMS includes procedures and metrics for measuring and evaluating wastes and the costs of environmental emissions. This information can help organizations implement the best practices and determine their results.
The environmental staff can help employees and management understand and use environmental systems to improve organizational performance and benefits. A management system can lead to more reliable and predictable environmental performance, which can reduce or limit the severity of incidents. ISO 14000 requires a common terminology, which improves the communication of goals, procedures, impacts, and solutions.
Improved communications can mean greater efficiency in decision making. For example, the severity of an environmental impact can increase with time, so an efficient notification system can reduce the time it takes to respond and thus the impact, risk and liability to the Organization. ISO 14000 provides feedback on the operations of the Organization that can be used for daily action and to determine the appropriateness of pollution prevention strategies. Problems that could be expensive to resolve and damaging to the environment can be identified earlier. Early management awareness of problems would offer the best opportunity for efficient resolution.
Management awareness of environmental impacts provides the opportunity for planning to reduce negative impacts. As ISO 14000 is accepted internationally, organizations will need to meet only one standard, thus simplifying environmental management.
A unified approach to environmental management provides the opportunity for sharing ideas among facilities. This can increase the efficiency and benefits of an EMS. Spreading environmental responsibility throughout the Organization places it with those directly associated with environmental impacts and pollution prevention. This improves the effectiveness and efficiency of pollution prevention programs
Marketing When environmental risks are reduced, the company becomes a more attractive investment to potential and current stockholders. Three factors contribute; and corporate environmental management, environmental 20 performance, environmental
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communications. Establishing a strong environmental image can help attract environmentally conscious customers and create pressure on competitors. This image must be carefully marketed to receive these benefits. Employees see ISO 14000 as good for their Organization and for them personally. Companies can receive credit for existing systems and accomplishments. Customers might favor companies with an EMS. These customers could be the ultimate consumer or industrial customers. As large, multinational manufacturers register to ISO 14000, they may favor suppliers with ISO 14000 registration. Community support for a facility could be increased by demonstrating concern for the local environment through an EMS. Workers may be attracted to a company with a plan to protect the immediate work environment and the surrounding community. A company's products may appeal to customers seeking green products. ISO 14000 registration demonstrates that the EMS meets international standards. Since registration requires third party auditing, it validates the EMS and the claims made by the Organization. Regulatory Compliance ISO 14000 requires evidence of working processes to maintain compliance with laws and regulations. These processes can help companies identify where they are out of compliance and take action. Regulators may favor organizations with an ISO 14000 registered EMS. Improved compliance with legislative and regulatory requirements could reduce penalties and redemption costs. An ISO 14000 EMS demonstrates to regulatory agencies that the organization is proactive about reducing pollution and committed to continual improvement. Social ISO 14000 helps create: A common language and way of thinking about environmental aspects which can help companies, communities, governments, and organizations communicate and work together. Cleaner air, waters, and soils. Longer resource life through reduced usage. Progress toward a sustainable culture.
Conclusion
Protecting the environment by coming into compliance or, ideally, going beyond compliance reduces waste and reduces costs and inefficiencies. It preserves natural resources and reduces the cost of finding new and more resources. It makes greater use of materials already purchased and 21
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reduces purchasing costs. It makes for cleaner emissions and reduces the severity of spills, leaks, and other accidents. Reducing these events reduces permitting costs, remediation costs, worker comp costs, insurance costs, lawsuit costs and fines, and many other costs and fees. Protecting the environment involves purchasing smaller amounts of materials or purchasing less toxic materials. These choices improve worker safety and morale, leading to more productive workers. Purchasing less hazardous materials reduces the need for and the costs associated with the need for special equipment, special training, and specially designed storage areas. These purchasing practices also reduce the cost of disposal. Protecting the environment by going beyond compliance helps keep regulators and inspectors out of the plant.
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Topic 3: WORKPLACE CULTURE

Culture and Quality Paradigm.
There are many different definitions of corporate culture. Culture is defined as the way we do things around here. The way employees actually behave, think and believe determines the culture. Culture is the personality of the organization. Culture is what employees do when no one is watching. It is a walk the talk. Consistent talking and actions matters much. Culture is the basic pattern of shared beliefs, behaviors, attitudes and assumptions acquired over time by members of an organization. Attitude shows the outlook and thoughts from which the work habits emerge. It reflects attitudes and practices related to quality systems application. Formal policies, procedures, behaviors and habits operate as the ground rules and guidelines. Vision, mission, values, goals and strategy are the guiding principles of a corporation and culture culminates from them. Corporate culture is changing fast. Everyone is expected to move at much faster speed. Operational principles for the corporations are Slim, Speed and Simple. Corporate culture is people in action. Quality culture refers to the degree of awareness, commitment, collective attitude, and behavior of the organization with respect to quality. Quality culture is basically incorporation of quality in the overall system of an organization which leads to a positive internal environment and creation of delighted customers. A changed mindset at all the levels of management is the basic tool for implementation of such a culture. As the process of initiating quality culture starts with managers who understand the value of the system's view and also believe in its implications. So in order to create such a culture a changed mindset was important. It can be achieved either through self realization at the top level or through trainings and workshops or following of benchmark organizations. Enemies of Quality Culture: Its the best we can do There is not enough time There is not enough money There are not enough people It is not in my budget It is not my responsibility 23
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Let someone else worry about it It is too late to change it The customer does not understand-It is not really a problem It is not my fault The quality control only applies to manufacturing It is as good as it can be Relax, we hit the goal The customer is first Continual improvement is essential to the success Quality does not take time, it saves time What gets measured gets managed Problems are opportunities in disguise The only bad mistake is a hidden mistake Training saves money It is the process, not the people Better is better than best
Friends of Quality Culture:
In the quality culture environment focus is on customer and quality becomes everyones responsibility. Employees are empowered to do their job. Customer expectations are exceeded and customer gets delighted. Creative quality culture involves: Pursuit of solving unidentified problems Surprising and delighting customers Goal of customer loyalty instead of satisfaction only Changes with stability and control Process focus
Workplace Culture and Quality

In order to inculcate quality culture at the workplace: 1. Effective Communication: People in organizations typically spend over 75% of their time in an interpersonal situation; thus it is no surprise to find that at the root of a large number of organizational problems is poor communications. Effective communication is an essential component of organizational success whether it is at the interpersonal, intergroup, intragroup, organizational, or external levels. 24
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2. Changing Mindset. 3. Better to better: Always endeavor to make thing better. Chinese proverb, Be not afraid of going slowly, be afraid only of standing still. 4. Creativity. 5. Management Commitment. It is just purely a management system that will help us to run our business in a more organized and systematic manner which will lead to a more consistent quality of the service that we deliver to customers. The quality of any organization is determined by the satisfaction of its customers who get the services. We should not only focus on external customers, but also focus on internal customers. Any quality improvement is achieved by improving the processes of an organization. It is a continuous activity in which we have to search for a much better way. It focuses more on opportunities for improvement, rather than waiting for a problem to reveal opportunities. Elimination of a problem will reduce any future occurrence, thus improve the processes of an organization.
Importance of Culture to Quality Management

Supportive work culture has been associated with a variety of benefits most of which are associated with the final products/service: High level of commitment to the organization High level of job satisfaction Low level of industrial stress Less conflict between employees and management High level of output and efficiency Ease of embracing new technologies and minimal resistance to change
A quality culture which is important to any serious organization will be manifested in the following ways: Customer driven excellence Valuing employees and partners Management by facts 25
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Clear and focused leadership Preventive/pro-active approach Continuous improvement Team approach Quality based and recognition systems
History of Quality Management Paradigms

The Evolution of Quality Approaches The shift to Quality Management may be revolutionary for many managers because the tenets of the new paradigms are so radically different from past managerial practices. It will require both a thought revolution and a behavioral revolution. Approaches to quality have evolved through a series of gradual refinements over the last century. The shift seems dramatic and revolutionary to many managers because they have not kept up with the evolving approaches over the years. However, they have not defined their managerial roles in terms of the latest advancements or they feel skeptical about its success. The Four Major Quality Eras are as follows 1. Customer-Craft OR the Inspection Era Until the nineteenth century, skilled craftsmen manufactured goods in small volume. They handcrafted and fit together parts to form a unique product that was only informally inspected. Population growth and industrialization brought about production in larger volume. Manufacturing in the industrialized world tended to follow this craftsmanship model till the factory system, with its emphasis on product inspection, started in Great Britain in the mid-1750s and grew into the Industrial Revolution in the early 1800s. The factory system, a product of the Industrial Revolution in Europe, began to divide the craftsmens trades into specialized tasks. This forced craftsmen to become factory workers and forced shop owners to become production supervisors, and marked an initial decline in employees sense of empowerment and autonomy in the workplace. Quality in the factory system was ensured through the skill of laborers supplemented by audits and/or inspections. Defective products were either reworked or scrapped. In the 1800s, increased specialization, division of labor, and mass production required more formal inspection. Parts had to be interchangeable. Inspectors examined products to detect flaws and separate the good from the bad. They used gauges to catch deviant parts and make sure parts fit together at final assembly. The gauging system made inspections more consistent than those conducted solely by eye, and gave inspection a new respectability. 26
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2. The Statistical Quality Control Era In 1931, Walter A. Shewhart gave quality a scientific footing with the publication of his book Economic Control of Quality of Manufactured Product. Shewhart was one of a group of people at Bell Laboratories investigating problems of quality. The statistical quality control approach that Shewhart advocated is based on his views of quality. Statistical quality control requires that numbers derived from measures of processes or products be analyzed according to a theory of variation that links outcomes to uses. Shewhart offered a pragmatic concept of quality: The measure of quality is a quantity which may take on different numerical values. In other words, the measure of quality, no matter what the definition of quality may be, is a variable. Shewharts emphasis on measurement in his definition of quality obviously relates to his prescriptions for statistical quality control, which requires numbers. Shewhart recognized that industrial processes yield data. For example, a process in which metal is cut into sheets yields certain measurements, such as each sheets length, height and weight. Shewhart determined this data could be analyzed using statistical techniques to see whether a process is stable and in control, or if it is being affected by special causes that should be fixed. In doing so, Shewhart laid the foundation for control charts, a modern-day quality tool. Shewharts concepts are referred to as statistical quality control (SQC). They differ from product orientation in that they make quality relevant not only for the finished product but also for the process that created it. 3. The Quality Assurance Era During the quality assurance era, the concept of quality in the United States evolved from a narrow, manufacturing-based discipline to one with implications for management throughout a firm. Statistics and manufacturing control remained important, but coordination with other areas, such as design, engineering, planning, and service activities, also became important to quality. While quality remained focused on defect prevention, the quality assurance era brought a more proactive approach and some new tools. The quality assurance era significantly expanded the involvement of all other functions through total quality control, and inspired managers to pursue perfection actively. However, the approaches to achieving quality remained largely defensive. Controlling quality still meant acting on defects. Quality was something that could hurt a company if ignored, rather than a positive characteristic necessary in obtaining competitive advantage. This view started to change in the 1970s and 1980s, when managers started to recognize the strategic importance of quality. 4. The Strategic Quality Management Era
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The present quality era, Strategic Quality Management, incorporates elements of each of the preceding eras, particularly the contributions of Shewhart, Deming, Juran, and Feigenbaum. So many elements of previous eras are incorporated into Strategic Quality Management that the last two decades may at first appear to be just a repackaging of old ideas. There are, however, dramatic differences from earlier eras. For the first time, top managers began to view quality positively as a competitive advantage, and to address it in their strategic planning processes, which are focused on customer value. Because quality started to attract the attention of top managers, it impacted management throughout the organization. Quality was not just for the inspectors or people in the quality assurance department to worry about. This era marks the emergence of a new paradigm for management. A number of developments were brought together and reconfigured into a new approach to management in all departments and specialties. A variety of external forces brought quality to the attention of top managers. They began to see a link between losses of profitability and poor quality. The forces that brought this connection to their attention included a rising tide of multimillion-dollar product liability suits for defective products and constant pressures from the government on several fronts, including closer policing of defects, product recalls. Perhaps the most salient external force was the growing market share incursions from foreign competitors, particularly the Japanese, in such diverse industries as semiconductors, automobiles, machine tools, radial tires, and consumer electronics. Producing products with superior quality, lower cost, and more reliable delivery, Japanese firms gained market shares and achieved immense profitability. The onslaught of these events in the mid1970s and 1980s seemed rather sudden; However, Japanese firm had been building their industrial capabilities for decades, developing and refining approaches to quality grounded in the principles taught to them by Americans after World War II. Manager and theorists have been captivated by Japanese management over the last two decades. Indeed, the Strategic Quality Management era borrows a number of its elements from the developments that quality took place in Japan at the same time as the quality assurance era in the United States. Factors that influence paradigm shifts in quality include; Globalization-dealing with customers with a lot of varieties Speed of innovation Outsourcing Quality evolution Quality ethics/business ethics e.g. business allocating resources to conserve the environment 28
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The changes that have taken place in the practice of quality can be seen in the following ways;
Quality has moved from being the responsibility of quality department to be the responsibility of all in the organization Product quality has shifted from being a product differentiator to being a necessity to compete in the marketplace The importance of quality has extended beyond the physical product to service and cultural frameworks Issues of learning, training, education and self management are important in quality practice more than before. Organizations have recognized the importance of focusing all the activities on the customer and their requirements Best practices have been developed and are flourishing
Workplace Ergonomics and Quality

Ergonomics is the study of designing equipment and devices that fit the human body, its movements, and its cognitive abilities. The International Ergonomics Association defines ergonomics as follows: Ergonomics (or human factors) is the scientific discipline concerned with the understanding of interactions among humans and other elements of a system, and the profession that applies theory, principles, data and methods to design in order to optimize human well-being and overall system performance. Ergonomics is employed to fulfill the two goals of health and productivity. It is relevant in the design of such things as safe furniture and easy-to-use interfaces to machines. Proper ergonomic design is necessary to prevent repetitive strain injuries, which can develop over time and can lead to long-term disability. Ergonomics is important to quality Management for the following reasons;

It allows for the matching of the human attributes with the work. It allows optimization of operations performed by a human being. It provides an understanding of the best practices affecting quality of output. It allows for introduction of the rest cycles for maximum concentration. It allows for matching of motivational factors.
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TOPIC 4: QUALITY MANAGEMENT AND LAW

Legal aspects in enforcing quality practices
Purchase/sale of goods and services are governed by the legal system. It is important that managers understand features of the law that govern the goods and services in a country. Most organizations however consider consulting a legal expert in matters relating to law. In Kenya, the following laws are closely associated to quality, Sale of goods Act(Cap 31,Laws of Kenya) The law of Contract Insurance law The law relating to carriage of goods The Negotiable instruments Act
These laws are further detailed and explained in your Business Law course. Rapid increase in liability suits in business has made the knowledge of legal services an important aspect of quality Management and assurance. An organization must attempt to fully guarantee that it fully complies with the laws and regulation pertaining to quality. The most common aspects of quality associated with the law include; Product label A label is an identity of a product and will in most cases include the name of the product, identity of the manufacturer, contents of the product and any other information. They have a direct relationship to quality Management through the doctrine of caveat emptor, warranty of disclosing the dangerous nature of goods, Conditions of fitness of use, conditions for sale (description, implied), patents rights, trademarks and copyrights. Packaging This refers to materials used in wrappings for protecting products from damage. Materials used in packaging have a direct impact on the quality of the products. Some of the legal aspects
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relating to packaging include carriage of goods, the law of contact and law relating to the environment and consumer protection. Safety This relates to the damage that the product may have on the environment and consumers during its use. Safety of product use is executed through the Law of contract, Sale of goods Act consumer and environmental protection laws. Transportation Quality is affected by movement of goods and the law protects all parties depending on their involvement. This is through the law of agency and contract. Design Patents, copyright and trademarks laws safe guide any design from any exploitation. Design quality is a key attribute and therefore should be protected by law Wording of warranties Any expressed/implied warranty of a product/service should be done with the guidance of a legal expert so as to ensure protection and enforceability. Contractual agreements Any contract entered into should have a legal framework that incorporates legal interpretation and universal understanding to both parties in a contract. Procedures and documentation All procedures and documents required in a process should be developed and facilitated based on a sound legal approach. All quality issues need to be documented to provide a basis for countering liability claims.
Business laws governing supply of goods and services

The scope of the law relating to quality governs the following areas of business: all commercial enterprises, all manufacturers for commercial end products, importers, exporters, and merchants; service providers of products and goods, advertisers of products, goods and services; and civic associations and non governmental agencies engaged in manufacturing, commerce, or humanitarian relief. Consumers' Rights and Business Obligations 1. Manufacturers and service providers are required to indicate on their products, goods, and service in English and Kiswahili language the ingredients, composition, users guidelines, manufacturing date, and expiration date along with other requirements which guarantee the safety and health of consumers prior to their commercialization. 31
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2. Manufacturers and services providers must comply with the general requirements of providing accurate information of their composition or configuration of the products, goods, or services so as to prevent confusion by consumers or damage competition. 3. Merchants, traders and services providers responsible for products, goods, or services first placed in the stream of commerce in Kenya will be required to ensure that their products or services are in compliance with the provisions of the law. 4. Importation of products or goods not found in compliance with the custom laws can be authorized provided they are ONLY transited for re-exportation e.g. the everpower brand of batteries from China to Uganda. 5. Importation of products and goods which are of humanitarian status or non-commercialized purposes can be allowed provided there is a special prior authorization from the Ministry of trade on behalf of the Kenya Government. 6. Presentation of proper compliance certificate, for exportation and importation, will be required for certain products which may be harmful to the health or safety of consumers, may affect fair commercial practices, may preserve and enhance the quality of locally manufactured products, are required by international trade or international conventions. 7. A quality label is a separate mark to identify the quality of a product, good, or service that the manufacturers or service providers voluntarily affix to their products or services. The affixing of the quality label is done for the purpose of meeting the consumers demand for information, to improve the manufacturers and service provider's production performance, and to enhance the quality products. Manufacturers and service providers must affix the quality label in strict compliance with the conditions stipulated by law. 8. It is prohibited to put in the stream of commerce food products which are known to be contaminated or toxic or do not meet bacteriological or sanitary requirement as stipulated by regulations of the ministries concerned. 9. It is prohibited to put into the stream of commerce products and instruments used for falsifying and counterfeiting products. 10. All forms of commercial advertising is prohibited if they are deceitful, misleading, false, or likely to cause confusion on the quality and safety of products, goods, and services .Advertisers placing commercial advertisements for their own account shall be held principally accountable in their capacity as an initiator. 11. For manufacturing, processing, and commercialization of products, goods, and services which can cause grave or imminent danger to consumers' health or safety, the competent ministries and departments can take the following actions: temporarily or permanently
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banning from sale; temporarily or permanently closing down the manufacturing facilities; or if necessary, withholding, confiscating, or destroying the products in question.
Quality and Product Liability

This refers to the responsibility of a manufacturer or vendor of goods to compensate for injury caused by defective merchandise that it has provided for sale. When individuals are harmed by an unsafe product, they may have a Cause of Action against the persons who designed, manufactured, sold, or furnished that product. The law has changed from caveat emptor ("let the buyer beware") to Strict Liability for manufacturing defects that make a product unreasonably dangerous. A manufacturer can be held liable for negligence if lack of reasonable care in the production, design, or assembly of the manufacturer's product caused harm. For example, a manufacturing company might be found negligent if its employees did not perform their work properly or if management sanctioned improper procedures and an unsafe product was made. Breach of warranty refers to the failure of a seller to fulfill the terms of a promise, claim, or representation made concerning the quality or type of the product. The law assumes that a seller gives certain warranties concerning goods that are sold and that he or she must stand behind these assertions. Misrepresentation in the advertising and sales promotion of a product refers to the process of giving consumers false security about the safety of a particular product, ordinarily by drawing attention away from the hazards of its use. An action lies in the intentional concealment of potential hazards or in negligent misrepresentation. The key to recovery on the basis of misrepresentation is the plaintiff's ability to prove that he relied upon the representations that were made. Misrepresentation can be argued under a theory of breach of express warranty or a theory of strict tort liability. Strict liability involves extending the responsibility of the vendor or manufacturer to all individuals who might be injured by the product, even in the absence of fault. Injured guests, bystanders, or others with no direct relationship to the product may sue for damages caused by the product. An injured party must prove that the item was defective, the defect proximately caused the injury, and the defect rendered the product unreasonably dangerous. Remedies to Product Liability 1. Attention to design to reduce the possibility of defects and errors 2. Documentation of design processes to provide supportive evidence in case of any liability claims 33
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3. Record evidence of all tests and procedures of critical product characteristics 4. Examination of all possible areas of defects and errors so as to eliminate and reduce their chances of occurrences 5. Attach all relevant warning and instructions labels in all products at all times. 6. Testing the products in all extreme and possible scenarios to identify and rectify problems 7. Designing for environmental considerations during the design of the product.
Enforcement of Quality Laws in Kenya

Quality policies in Kenya are mainly established through the legislature creating Acts of Parliament. Several institutions have been created to engage in management of quality in the Kenya. They include; 1. Kenya Bureau of Standards 2. National Environment Management Authority 3. Ministry of Industrialization 4. Kenya Plant Inspectorate Services (KEPHIS) 5. Kenya legal System and other Acts of Parliament such as Public Procurement and regulation Act. All entities formed through the Acts of parliament will enforce and execute their mandate through the Kenyan Court system in case of violations. The challenges faced in enforcing quality practices in Kenya include; 1. Corruption 2. Lack of adequate resources 3. Lack of awareness on legal quality issues 4. Capacity challenges 5. Political challenges 6. Poor policies from the government
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TOPIC 5: UNDERSTANDING COMPLEXITY IN QUALITY

People define quality in many ways. Some think of quality as superiority or excellence, others view it as a lack of manufacturing or service defects, still others think of quality as related to product features or price. Followings are some of many ways to look at quality. 1. perfection 2. consistency 3. eliminating waste 4. speed of delivery 5. compliance with policies and procedures 6. providing a good, usable product 7. doing it right the first time 8. delighting or pleasing customers 9. total customers service and satisfaction Today most managers agree that the main reason to pursue quality is to satisfy customers. The American National Standards Institute (ANSI) and the American Society for Quality (ASQ) define quality as "the totality of features and characteristics of a product or service that bears on its ability to satisfy given needs. The view of quality as the satisfaction of customer needs is often called fitness for use. In highly competitive markets, merely satisfying customer needs will not achieve success. To beat the competition, organizations often must exceed customer expectations. Thus, one of the most popular definitions of quality is meeting or exceeding customer expectations. Quality in Manufacturing Well-developed quality systems have existed in manufacturing for some time. However, these systems focused primarily on technical issues such as equipment reliability, inspections, defect 35
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measurement, and process control. The transition to a customer-driven organization has caused fundamental changes in manufacturing practices, changes that are particularly evident in areas such as product design, human resource management, and supplier relations. Product design activities, for example, now closely integrate marketing, engineering, and manufacturing operations. Human resource practices concentrate on empowering workers to collect and analyze data, make critical operations decisions, and take responsibility for continuous improvements, thereby moving the responsibility for quality from the quality control department onto the factory floor. Suppliers have become partners in product design and manufacturing efforts. Many of these efforts were stimulated by the automobile industry, which forced their network of suppliers to improve quality. Manufactured products have several quality dimensions including the following: Performance: a products primary operating characteristics measured in specific quantitative terms which allows comparison and ranking e. g speed, power, acceleration etc Feature: the bells and whistles of a product. The non-operating characteristics of a product that accompany a product offering. They are nonetheless very important to the customer. Reliability: the probability of a products surviving over a specified period of time under stated Conditions of use Conformance: the degree to which physical and performance characteristics of a product match pre-established standards. Durability: the amount of use one gets from a product before it physically deteriorates or until replacement is preferable. Serviceability: the ability to repair a product quickly and easily. Aesthetics: how a product looks, feels, sounds, tastes, or smells. Perceived quality: subjective assessment resulting from image, advertising, or brand names.
Most of these dimensions revolve around the design of the product. Quality in Services Service can be defined as any primary or complementary activity that does not directly produce a physical productthat is, the non goods part of the transaction between buyer (customer) and seller (provider). A service might be as simple as handling a complaint or as complex as approving a home mortgage. Service organizations include hotels; health, legal, engineering, and other professional services; educational institutions; financial services; retailers; transportation; and public utilities. Today services account for nearly 80 percent of the U.S., Singapore and Sweden workforce. The importance of quality in services cannot be underestimated, as statistics from a variety of studies reveals: 36
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The average company never hears from more than 90 percent of its unhappy customers. For every complaint it receives, the company has at least 25 customers with problems, about one-fourth of which are serious.
Of the customers who make a complaint, more than half will do business again with that organization is their complaint is resolved. If the customer feels that the complaint was resolved quickly, this figure jumps to about 95 percent.
The average customer who has had a problem will tell nine or ten others about it. Customers who have had complaints resolved satisfactorily will only tell about five others. It costs six times more to get a new customer than to keep a current customer.
So why do many companies treat customers as commodities? In Japan the notion of customer is equated with honored guest. Service clearly should be at the forefront of a firms priorities. The service sector began to recognize the importance of quality several years after manufacturing had done so. This can be attributed to the fact that service industries had not confronted the same aggressive foreign competition that faced manufacturing. Another factor is the high turnover rate in service industry jobs, which typically pay less than manufacturing jobs. Constantly changing personnel makes establishing a culture for continuous improvement more difficult. The production of services differs from manufacturing in many ways, and these differences have important implications for managing quality. The most critical differences are: 1. Customer needs and performance standards are often difficult to identify and measure, primarily because the customers define what they are, and each customer is different. 2. The production of services typically requires a higher degree of customization than does manufacturing. Doctors, lawyers, insurance salespeople, and food-service employees must tailor their services to individual customers. In manufacturing, the goal is uniformity. 3. The output of many service systems is intangible, whereas manufacturing produces tangible, visible products. Manufacturing quality can be assessed against firm design specifications, but service quality can only be assessed against customers subjective, nebulous expectations and past experiences. Manufactured goods can be recalled or replaced by the manufacturer, but poor service can only be followed up by apologies and reparations. 4. Customers often are involved in the service process and present while it is being performed, whereas manufacturing is performed away from the customer. For example, customers of a quick-service restaurant pace their own orders, carry their food to the table, and are expected to clear the table when they have finished eating. 5. Services are produced and consumed simultaneously, whereas manufactured goods are produced prior to consumption. This gives little room for correction of errors as opposed to 37
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the manufacturing sector where corrective action can be taken even before the product reaches to the customer Challenges involved in Service offering include the following; 1. Services are generally labor intensive, whereas manufacturing is more capital intensive. The quality of human interaction is a vital factor for services that involve human contact. For example, the quality of hospital care depends heavily on interactions among the patients, nurses, doctors, and other medical staff. Hence, the behavior and morale of service employees is critical in delivering a quality service experience. 2. Many service organizations must handle very large numbers of customer transactions. For example, on a given business day, Equity Bank of Kenya might process more than 2 million transactions for 4.5 million customer through its branches and cash machines, or Fed Ex might handle more than 1.5 million shipments across the globe. Such large volumes increase the opportunity for error. These differences have made it difficult for many service organizations to apply total quality principles. Many service organization have well-developed quality assurance systems. Most of them, however, are based on manufacturing analogies and tend to be more product-oriented than service-oriented. Many of the key dimensions of product quality apply to services. For instance, on time arrival for an airline is a measure of service performance; frequent flyer awards and business class sections represent features. A typical hotels quality assurance systems focus on technical specifications such as properly made-up rooms. However, service organizations have special requirements that manufacturing systems cannot fulfill. The most important dimensions of service quality include the following; you may remember the most important ones by RATTER: 1. Reliability: How much reliable is the service provider? 2. Accessibility and convenience: Is the service easy to obtain? 3. Timeliness: Will a service be performed when promised? 4. Completeness: Are all items in the order included? 5. Consistency: Are services delivered in the same fashion for every customer, and every time for the same customer? 6. Tangibility: after the service is over, is there anything to take home to remind the service experience? 7. Empathy or Courtesy: Do frontline employees greet each customer cheerfully? 8. Responsiveness: Can service personnel react quickly and resolve unexpected problems? Service organizations must look beyond product orientation and pay significant attention to 38
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customer transactions and employee behavior. Several points that service organizations should consider are as follows: The quality characteristics that a firm should control may not be the obvious ones. Customer perceptions are critical although it may be difficult to define what the customer wants. For example, speed of service is an important quality characteristic, yet perceptions of speed may differ significantly among different service organization and customers. Marketing and consumer research can play a significant role. Behavior is a quality characteristic. The quality of human interaction is vital in every transaction that involves human contact. For example, banks have found that the friendliness of tellers is a principal factor in retaining depositors. Image is a major factor in shaping customer expectations of a service and in setting standards by which customers evaluate that service. Establishing and measuring service levels may be difficult. Service standards, particularly those relating to human behavior, are often set judgmentally and are hard to measure. In manufacturing, it is easy to quantify output, scrap, and rework. Customer attitudes and employee competence are not as easily measured. Quality control activity may be required at times or in places where supervision and control personnel are not present. Often work must be performed at the convenience of the customer. This calls for more training of employees and self-management. These issues suggest that the approach to managing quality in services differs from that used in manufacturing. However, manufacturing can be seen as a set of interrelated services, not only between the company and the ultimate consumer, but within the organization. Manufacturing is a customer of product design; assembly is a customer of manufacturing; sales are a customer of packaging and distribution. If quality is meeting and exceeding customer expectations, then manufacturing takes on a new meaning, far beyond product orientation. Total quality provides the umbrella under which everyone in the organization can strive to create customer satisfaction. Cost of Quality The reason quality has gained such prominence is that organizations have gained an understanding of the high cost of poor quality. Quality affects all aspects of the organization and has dramatic cost implications. The most obvious consequence occurs when poor quality creates dissatisfied customers and eventually leads to loss of business. However, quality has many other costs, which can be divided into two categories. The first category consists of costs necessary for achieving high quality, which are called quality control costs. These are of two types: prevention costs and appraisal costs. The second category consists of the cost consequences of poor quality, which are 39
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called quality failure costs. These include external failure costs and internal failure costs. The first two costs are incurred in the hope of preventing the second two. Prevention costs are all costs incurred in the process of preventing poor quality from occurring. They include quality planning costs, such as the costs of developing and implementing a quality plan. Also included are the costs of product and process design, from collecting customer information to designing processes that achieve conformance to specifications. Employee training in quality measurement is included as part of this cost, as well as the costs of maintaining records of information and data related to quality. Appraisal costs are incurred in the process of uncovering defects. They include the cost of quality inspections, product testing, and performing audits to make sure that quality standards are being met. Also included in this category are the costs of worker time spent measuring quality and the cost of equipment used for quality appraisal. Internal failure costs are associated with discovering poor product quality before the product reaches the customer site. One type of internal failure cost is rework, which is the cost of correcting the defective item. Sometimes the item is so defective that it cannot be corrected and must be thrown away. This is called scrap, and its costs include all the material, labor, and machine cost spent in producing the defective product. Other types of internal failure costs include the cost of machine downtime due to failures in the process and the costs of discounting defective items for salvage value. External failure costs are associated with quality problems that occur at the customer site. These costs can be particularly damaging because customer faith and loyalty can be difficult to regain. They include everything from customer complaints, product returns, and repairs, to warranty claims, recalls, and even litigation costs resulting from product liability issues. A final component of this cost is lost sales and lost customers. For example, manufacturers of lunch meats and hot dogs whose products have been recalled due to bacterial contamination have had to struggle to regain consumer confidence. Other examples include auto manufacturers whose products have been recalled due to major malfunctions such as problematic braking systems and airlines that have experienced a crash with many fatalities. External failure can sometimes put a company out of business almost overnight. Companies that consider quality important invest heavily in prevention and appraisal costs in order to prevent internal and external failure costs. The earlier defects are found, the less costly they are to correct. For example, detecting and correcting defects during product design and product production is considerably less expensive than when the defects are found at the customer site. External failure costs tend to be particularly high for service organizations. The reason is that with a service the customer spends much time in the service delivery system, and there are fewer opportunities to correct defects than there are in 40
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manufacturing. Examples of external failure in services include an airline that has overbooked flights, long delays in airline service, and lost luggage.
Systems Approach to Quality
Diagram depicting an organization as a system
Systems theory fundamentals An organization is a complex relationship involving people, physical assets, funds and processes, all aligned to achieving predetermined goals and objectives. An organization takes the inputs and adds value to them by means of processes and procedures, which transforms them into outputs. The effectiveness of this transformation is measured by the outcomes. Systems theory and continuous improvement Systems theory holds that an organization can get better outputs, and as a result, better outcomes, by controlling the quality of both inputs and the transformation process (the first two columns in the diagram). Therefore, emphasis should be on continually improving the inputs and transformation process, which are under the control of the organization. These efforts usually result in incremental improvement over time although there can be breakthrough improvements. Organizational capability 41
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This refers to the organizations ability to perform using the available resources (the inputs on the diagram above). Three dimensions that must be aligned and support each other to build organizational capability that will deliver results are: Human capital: people skills and knowledge Social capital: relationships between people Organizational capital: organizations processes
Defining a quality system A quality system is a structured and documented approach that covers the structure, procedures, processes, responsibilities and resources needed to implement a system wide approach to ensuring quality in work processes, products and services. It usually consists of a philosophy, a framework, a methodology and a set of tools. Most organizations are made up of individual functional units that are represented as departments that ultimately provide customer satisfaction in their own unique way. Management of quality should be performed using systems approach where independent functional areas are unified with the aim of satisfying both the internal and external customers. In a typical functional area, quality contributions can be achieved in the following ways; Manufacturing/production Development of quality processes Instituting quality assurance systems in the processes Participating in product designs activities Instituting process control systems Developing quality inspection and measurement systems Establishing customer requirements Identify product features as determined by the customer Establishing the price the customer is willing to pay for a given level quality To continuously obtain feedback on product quality for continuous improvement Ensuring customer satisfaction by providing quality and after sale services Develop technical specifications for the products Provide measures and specifications on product services required to produce a quality product. To translate information collected from the customer into product requirement Develop ways of continuously improving product or service offering 42
Sales and Marketing
Research and Development
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Develop standards for evaluating product and service quality Selecting suppliers who are able to deliver quality materials and parts Establish products requirements in line with specifications developed by the research department Establish long term supplier relationships based on trust Informing supplier of any problems/defects encountered in the use of the product Measuring quality of products as they are received from suppliers.
Purchasing Department
Human Resource Recruitment of qualified staff Developing training to continuously empower employees Initiate a reward and recognition system based on quality performance Carry out job design and work measurements to ensure high quality output. Allocation of resource to quality management Measurement of cost of quality i.e. cost of compliance and cost of non-conformance Evaluation of quality investment
Finance and Accounting
In summary, each functional area therefore has a unique role to play the quality chain. The ultimate goal is to produce products and services that are of high quality that meet and exceed customer expectations.
Effects of Complex Systems on Management of Quality

In organizations where systems approach to quality management is used there is increased complexity and the need to bring together complex systems into the process of creating satisfied customers. Managers must therefore be able to analyze the linkages in order to develop approaches that will allow customer satisfaction. Quality management has increased due to the following: Increased customization of product and services to meet individual needs and requirements of the customer. The realization of direct relationship between internal and external customer satisfaction and therefore the need to develop systems that best satisfies this relationship. The increased reliance on long term customer relationship extending the mandate of management beyond the organizational structure.
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The need to continuously manage quality based on the realization that Q.M is achieved through the systems approach. The ever changing definition of quality has created a new role that permeates throughout the organization. Quality is taking a more strategic role as opposed to operational and tactical/functional strategy. Increased globalization due to the internet, shifting in trade politics and new collaborations creating more pressure on managers
The above complexity has brought about the following effects on management of quality 1. Increased impact on quality management services on profitability 2. Quality cost and the management of costs associated with quality has increased significantly 3. Increased focus on internal customer satisfaction in order to achieve external customer satisfaction 4. Increased appreciation of quality as a strategic component of competitiveness 5. Creation of more partnership with suppliers leading to increased use of standardization and quality assurance 6. Customer satisfaction is a focal point of every activity and systems.
Integrating organization structure and quality

During the past 20 years, the global marketplace has become increasingly competitive. Managers are contending with rapid changes in technology, shorter product life-cycles, new markets, and a demand for higher quality products. Companies trying to gain a competitive edge in this marketplace have realized the importance of raising the quality of goods and services, and have implemented programs such as TQM (Total Quality Management).Quality Management concept is now well established in U.S. and Western Europe, and is increasingly implemented in emerging economies (China, India, Brazil and Russia) and in the developing Countries of Central and Eastern Europe and part of Africa. An organizational structure is the pattern or arrangement of jobs and groups of jobs within an organization. This pattern pertains to both reporting and operational relationships, provided they have some degree of permanence. The individual elements of an organization structure typically include a variety of components that Portable MBA in Management contributors Phyllis and Leonard Schlesinger termed organizational "building blocks": 1) departments or divisions; 2) management hierarchy; 3) rules, procedures, and goals; and 4) temporary building blocks such as task forces or committees.
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Traditionally, organizations developed structures that maintain stability and were therefore highly rigid with rules and regulations. However, this has changed due to the rapid changes in the environmental characteristics of modern organizations which are highly flexible and complex due to level of competition. The following factors are considered to affect/determine the organization structure to be used when managing quality; Organizations operating guidelines/standard practices that have been developed to guide how organizations work. Management style depending on whether the management is formal/informal, democratic/autocratic as this will affect organization structure. Customer influence-in certain circumstances customers will dictate the functions required and therefore the structure to be used. Company style: large organizations will demand a formal structure as opposed small organizations Complexity and diversity of production line. An organization producing large volumes of standardized products will use a vertical structure whereas an organization with diverse production line will more likely require a horizontal structure. There are several types of organizational structure that exist for effective management of quality. They include the following A) Functional Organization Organization by function brings together in one department everyone engaged in one activity or several related activities that are called functions. For example, an organization divided by function might have separate manufacturing, marketing, and sales departments. A sales manager in such an organization would be responsible for the sale of all products manufactured by the firm. Functional organization is perhaps the most logical and basic from of departmentalization. It is used mainly by smaller firms that offer a limited line of products because it (1) makes efficient use of specialized resources. Another major advantage of a functional structure is that (2) it makes supervision easier, since each manager must be expert in only a narrow range of skills and quality delivery and processes are easy to monitor. In addition, (3) a functional structure makes it easier to mobilize specialized skills and bring them to bear where they are most needed. B) Product/Market Organization Structure (Product Or Market Organization) Often referred to as organization by division, it brings together in one work unit all those involved in the production and marketing of a product or a related group of products, all those in a certain geographic area, or all those dealing with a certain type of customer. Most large, multi product companies, such as General Motors, have a product or market organization structure. At some point in an organizations existence, sheer size and diversity of products make functional departments too 45
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unwieldy. When a companys departmentalization becomes too complex for coordinating the functional structure, top management will generally create semiautonomous division for flexibility in decision making. In each division, management and employees design, produce, and market their own products. Product quality is also managed at each level and at all subsequent divisions. Unlike a functional department a division resembles a separate business. The division head focuses primarily on the operations of his or her division, is accountable for profit or loss, and may even compete with other units of the same firm. But a division is unlike a separate business in one crucial aspect: the division manager must still report to central headquarters. C) Matrix Organization Structure/Multiple Command System. The matrix structure, sometime referred to as a multiple command system, is a hybrid that attempts to combine the benefits of both types of designs while avoiding their drawbacks. An organization with a matrix structure has two types of structure existing simultaneously. Employees have in effect two bosses-that is, they work in two chains of command. One chain of command is functional or divisional, the type diagrammed to run vertically. The second is a horizontal overlay that combines people from various divisions or functional department into a project or business team led by a project or group manager who is an expert in the teams assigned area of specialization. In summary, each of the quality management structure have their own advantage and disadvantage and therefore a structure that an organization will select must allow for flexibility and ability to change and respond to environmental changes. What is important is for the management to adapt structures that will drive quality and performance, excellence through the organization by using effective communication and role modeling.
Quality Management and Organizational Productivity.

There is a close relationship between quality levels and productivity of processes and employees. Improved quality has a positive effect on overall productivity while poor quality reduces the level of productivity. Poor quality leads to 1. Stoppage of processes to make corrections 2. Extra time is wasted on re-works 3. Handling of sub -standard products leading to additional costs. 4. Wasted time on corrections rather than innovations 5. Low capacity utilization 6. Loss of customers leading to loss of sales 7. High economies of scale 46
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8. Low employee motivation 9. High operating cost 10. Litigation and compensation costs increases 11. Injuries and accidents hampering employee performance.
TOPIC 6: THE MEDIA ON PUBLIC PERCEPTION

The pressure to maintain quality in product or service quality has become a milestone around the neck of organizations? Quality management has become crucial more than ever especially in an era where outsourcing of product production has spread everywhere like a wide fire. Consumer products now travel across multiple strands of logistics outlet before getting to final consumers. The battle of the will is now the struggle to seal the preferred supplier status because of consumer perception on services or product quality is unpredictable. We now live in an increasingly complex society where consumers needs, priorities as well as perception are integrated in to product and service process. With wide array of reduced amount of distinguishable products, expectation and power of consumer rose. Consumers are now loyal to quality product and superior performance. Product failure and defect does not only result to negative perception, it can lead to loss of customer and lawsuit. Furthermore, repeated failure can lead to damage to organizational reputation and position in the market place. David Aaker author of the book Managing brand equity defined perceived quality as the customers perception of the overall quality and superiority of a product or service with respect to its intended purpose, relative to alternative. 'Media' is the plural of the Latin word medium, which means "middle ". It is a medium for disseminating information; this constitutes both, as a means of expression and an intermediary who transmits a message to a group. The media may include radio, television, print media, books or the Internet. Business must offer quality service to customers and clients if they want to maintain a positive public image. Setting customer service standards help to ensure that companies reach, and exceed, customers' expectations. When it comes to customer satisfaction, it all comes down to public 47
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perception: How the customer sees and experiences the product and service provided by a company. It's not what you believe or think, not what your studies or focus groups tell you, but what your actual customers feel, experience and say. The following are some of the ways a company can use the media to shape favorable public opinion; The Benefits of favorable public opinions- A managers perspective Transparency: This is exactly what consumers and buyers want in their partners and brands. They dont expect you to be perfect, but they expect you to tell it like it is. Accept your weaknesses, admit to your faults, say youre sorry when you do something wrong. Do that in realtime (have the courage to do so!) and not only will your current customers be more loyal to you, but youll be surprised how quickly transparency will convert the cautious and skeptical to your side. Credibility: By exposing yourself to the good, bad and ugly of the marketplace, you make everything else you do more sincere and credible. By enabling and embracing transparency, you by definition create credibility for yourself and your brand. Even those who still dont completely accept you, or prefer your competitors, cant help but admire your position and openness. And credibility (a close cousin of trust) is the foundation of any strong, long-term relationship. Humanity: Guess what? Behind every strong company, every brand, every building are people. Real people build the product, provide the service, and innovate what you see today into the products, services and solutions of tomorrow. Show the humanity of the people behind your brand through your media outlets directly in front of and in exchanges with your customers and theyll be attracted to you all the more. Community: Perhaps the best part of medias opportunity for customer service is that were no longer talking at our customers. Every interaction is an opportunity to not only facilitate a two-way conversation, but open that conversation to other customers to foster and enhance the feeling of community. Combine transparency and humanity with community, and the bonds get stronger. How to shape favorable public opinion 24-7 Monitoring: You have to watch, all the time. If something blows up on a Friday night, its not OK to wait to respond until Monday morning. This mentality worked when communication was both interruptive and one-way, and when the call center shut down in the evening hours. But media doesnt work that way. Your customers (and detractors) will talk whenever they feel like it (Via facebook, tweeter etc). You (and your team, and your fans) need to pay closer and wider attention to whats going on and whats being said so you can address, correct and/or amplify messages as appropriate. 48
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Fast Response Time: Even if youre just saying let me check & Ill get back to you, respond quickly. Dont let open-ended questions and opinions hang out there without a response. Customers Helping Customers: You (and your team) dont need to be the only respondent when someone asks a question. Your customers can help each other as well. Give customers access to your media channels, and encourage them to self-support each other with answers, best practices, usage tips and more. Empower Customers as Community Leaders: If you know who your most active, supportive customers are, why not promote them to community leaders? Give them a discount or special consideration with your product, service or brand in exchange for actively participating in forums on your behalf. Customers helping customers will always work more credibly than brands helping customers, plus it takes more of the load off of your shoulders (particularly important for resourceconstricted companies). Throw a Party for New Customers: Do your new customers feel welcome, or are they intimidated by their lack of experience and knowledge? Make them feel welcome in your community. Invite them to introduce themselves, and share a story (or two) about what theyre doing and how theyre using what youre selling. This sharing alone will make them feel a part of the community, will immediately help you (and your community leaders) understand how they might be able to help, and will increase their likelihood to come back to you first if they have questions, concerns or complaints. Publicize Availability in All Channels: Do your customers know where your communities are? Do they know how to find you at 1:00 in the morning? How are you helping brand new customers discover these channels & resources? The more customers discover and engage these customer service opportunities, the more likely theyll engage with the community and accelerate their satisfaction and loyalty (not to mention decrease cost of your more traditional, resource-intensive customer service options). Its Not Just About Twitter! Know your customers, and know which channels theyre more likely to engage with. Twitter is valuable, sure, but so is Facebook, LinkedIn, discussion forums, wikis, blogs and more. Find out where your customers are more likely to engage, and put your focus there (at least initially). Organizational Implementation Advice Customer Service is the New Marketing: Lets face it, if you successfully implement customer service, your customer service organization will be engaged with your customer more often and more frequently than traditional marketing channels. Doesnt that mean customer service is now as 49
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if not more important to shaping customer perceptions, brand preference and purchase activity? If you started your organization from scratch, I bet customer service and marketing would be the same thing, and in the same organization. Treat it that way now and things work better, more smoothly and more successfully. Executive Support is Key: They dont need to be involved every day (although their active presence in your channels can accelerate credibility & humanity), but your executive team needs to strongly and publicly endorse what youre doing. Many others are likely to want to slow down or limit how transparent and pervasive channels are executed in your customer service plan. Active executive sponsorship can nip that in the bud, quickly. Choose & Train Participants: Dont assume everyone in your customer service organization will know how to best engage customers in these open channels. Dont go overboard with rules and brand restrictions, but give participants some training, guidelines and even some role-playing to show whats expected and whats possible. Reward Engagement & Behavior: This applies both to your internal staff as well as your loyal customers. Encourage, recognize and reward positive interactions, speedy responses to issues, and success stories where your newly-leverage customer service channels have won over a skeptic, saved a fading customer, or created a new brand loyalist for life. An organization can shape public opinion on quality issues by implementing the following strategies; Using integrity and fairness as criteria for all business decisions; Maintaining an emphasis on quality of products or services; Openly sharing truthful information with all publics; Actively seeking input from publics and being responsive to concerns; Renewing a commitment to local communities; and Creating forums to encourage dialogue with constituencies.
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TOPIC 7: ORGANIZATIONS SELF-CONCEPT

A major determinant of a firms success is the extent to which it can relate functionally to its external environment. To achieve its proper place in a competitive situation, the firm realistically must evaluate its competitive strengths and weaknesses. This ideathat the firm must know itself is the essence of the company self-concept. The idea is not commonly integrated into theories of strategic management; its importance for individuals has been recognized since ancient times. Both individuals and firms have a crucial need to know themselves. The ability of either to survive in a dynamic and highly competitive environment would be severely limited if they did not understand their impact on others or of others on them. In some senses, then, firms take on its members in other ways than their individual interactions. Thus, firms are entities whose personality transcends the personalities of their members. As such, they can set decision-making parameters based on aims different and distinct from the aims of their members. These organizational considerations have pervasive effects. Ordinarily, descriptions of the company self-concept per se do not appear in mission statements. Yet such statements often provide strong impressions of the company self concept.
Self Perception and Quality

Leaders make decisions based on how they perceive, that is sense and understand, the events, people, and things around them. Yet most of us have experienced instances where our perceptions were clearly erroneous and the events, people and things around us were not what they appeared to be. While more accurate perceptions should obviously provide a stronger base for decision making, some leaders may argue that problems resulting from inaccurate perceptions are infrequent 51
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and often minor. Of course, most of us do perceive reasonably accurately most of the time, but effective executives know that, as in sports or any other professional field, the difference between top and mediocre performance is often measured in millimeters and microseconds. Since most leaders strive to be that little bit better than their peers, they must seek to understand the perceptual process better in order to develop the skill to perceive events and people more accurately and thus have a better base for making decisions. Like manufacturing, perception involves a process leading to a product output. In psychology these two are usually called perceiving, the process, and percept, the product, respectively. The product is the conclusions, inferences, or judgments we reach about an event or situation while the process involves all the steps that take us there.
How to Perceive quality issues More Accurately There are a number of things that an organization can do that will assist us in perceiving reflectively and more accurately on quality issues: Thorough self analysis to understand our own motives, needs, beliefs and biases towards quality. Reflectively create a climate of openness between the organization and others in order to be able to discuss quality issues. Reflectively generate valid information, avoid premature attribution, and focus on the particular behavior in the situation. Seek feedback from other stakeholders on our perceptions; how do they see the situation. Give feedback to others about our perceptions. But be sure the feedback is intended to be and is phrased to be helpful and not intended to boost our own ego. Broaden the organization perspective by reading about, listening to, and observing people, things and events affecting quality. Look at, and learn at least a little bit about, literature, art, politics, behavior, humanities, ethics, science, etc.; as opposed to looking only at one area of specialization or interest. This broadens the organization experiences. Perceptual Issues on Quality which Need to be Determined Uniqueness: What makes our product or service different from others Image of self: How do we see ourselves? What do we like best and least about ourselves? Past experience: What are the most important past experiences that made an impression on us? Learning: What are the important things we have learned? What are our belief systems? 52
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Values: Do we know what values we cherish? would we surrender last?
What possession, tangible or intangible,
Familiarity: In what area of activity are we most familiar and secure? Wants: What one thing would we most want to be able to do? Focus: To what activity should we give most of the attention on the job to attain quality improvement?
Although the perceptual process is a very difficult and complex one, leaders who understand it and develop the skills to improve the accuracy of their perceptions have a stronger base for decision making and thus have that critical small edge over their competitors.
Self Esteem
'Self refers to the personality of an individual as viewed by that person himself. According to personality theory, "self-concept" refers to the efforts made by an individual to understand his own self. Self-concept is closely related to the concepts of self-esteem and self-efficacy. Traditionally, more attention was given to the concept of self-esteem than to the concept of self-efficacy. However, recently, the concept of self-efficacy has begun to attract great attention in the field of organizational behavior Self-esteem refers to the self-perceived competence and self-image of people working in a particular organization. Behavioral scientists have conducted extensive research on the role of selfesteem in influencing organizational behavior. These studies have shown that self-esteem has a moderating influence on employees' emotional and behavioral responses to various situations and the stress experienced by them. These studies have also proved that employees with high selfesteem perceive themselves as unique, competent, secure and empowered. That is, they possess the ability to positively influence situational factors in order to accomplish the assigned tasks. Moreover, such people are able to confidently and freely interact with people around them and are likely to produce high quality. Self-efficacy refers to a person's perception of his ability to cope with different situations as they arise. People with high self-efficacy have the capability and the required confidence to rise to the occasion. Though self-efficacy is closely related to self-esteem, there are certain differences. One major difference between the two concepts is that self-esteem is a generalized trait (it is present in all situations) whereas self-efficacy is situation-specific. The self-efficacy of a person can be measured along three dimensions - level, strength and generality. 'Level' refers to the number of 53
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tasks a person can effectively perform, 'strength' refers to how firmly a person believes he is capable of performing a task and 'generality' refers to the extent to which the self- efficacy expectations of an individual can be generalized (instead of varying from situation to situation). Researchers found that self-efficacy and employee performance are highly correlated. The relationship between self-efficacy and performance is cyclical. Self-efficacy affects performance which in turn affects self- efficacy. The role of self-efficacy is vital in helping an individual cope with tough jobs, make a career choice, learn and achieve something, and adapt to new technology. Organizations can enhance the self- efficacy of employees by training them.
Topic 8: COMMITMENT AND LEADERSHIP IN QUALITY MANAGEMENT

Introduction What defines and differentiates leadership in quality management? What is 'Quality Leadership'? The fundamental foundations of Quality, the teachings of the Gurus, are all based on organizational leadership with an ethical core focusing on people, social responsibility and quality of work life. Leadership is fundamental to management and organizational behavior and is on just about everyones short list of prerequisites for organizational success. Thus it is not surprising that leadership plays a crucial role in the total quality organization. Virtually every article and book written about quality emphasizes leadership. Teach and institute leadership is one of W.E. Demings 14 Points. Leadership is recognized as the driver of successful quality systems. In practice, the notion of leadership can be as elusive as the notion of quality itself. Most definitions of leadership reflect an assortment of behaviors, for example: Vision that stimulates hope and mission that transforms hope into reality; Radical servant hood that saturates the organization; Stewardship that shepherds its resources; Integration that drives its economy; The courage to sacrifice personal or team goals for the greater community good; Communication that coordinates its efforts; Consensus that drives unity of purpose; Empowerment that grants permission to make mistakes, encourages the honesty to admit them, and gives the opportunity to learn from them; and 54
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Conviction that provides the stamina to continually strive toward business excellence. The roles of a Quality Leader Underlying the concept of quality leadership are some clear imperatives for managers who aspire to quality leadership. First, they must establish a vision. Second, they must live the values. Third, they must lead the improvement efforts. Let examine each of these in turn. Establish a Vision A vision is a vivid concept of what an organization could be. It is a striking depiction of possibilities, of potential. It is a dream, both in the sense of being desirable and in the sense of being a long way from the current reality, but it is not an impossible dream. A vision should be clear and exciting to an organizations employees. It should be linked to customers needs and convey a general strategy for achieving the mission. Live the Values. Pursuing the quality vision commits the organization to living by a set of values such as devotion to customers, continuous improvement, and teamwork. A manager who hopes the organization will embrace and live by these values must live them to the utmost. Managers actions can symbolize their commitment to quality-oriented values in many concrete ways. For example, they can attend training programs on various aspects of quality, instead of just sending others. They can practice continuous improvement in processes that they control, such as strategic planning and capital budgeting. Perhaps most importantly, they can provide adequate funding for quality efforts. So that QM will not be the poor cousin to other business issues. Lead Continuous Improvement. Beyond establishing vision for the organization and expressing quality values through their decisions and actions, quality-oriented leaders must lead the continuous process improvement efforts that are the meat and potatoes of total quality management. All of the vision and values in the world are worthless if the organization is not continuously making strides to improve its performance in the eyes of customers. Visions of world-class quality and competitiveness can only be achieved if an organization keeps finding ways to do things a little better and a little faster. Leaders must be at the center of these efforts.
Quality and Competitiveness

The fundamentals of quality still exist and are important despite the tremendous changes in product, processes environment and customer management. All industries face competition for customers and resources and as such a company must remain competitive. Quality is now taking 55
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precedent over price, reliability and availability and organization must now realize that quality can be utilized as a competitive tool. Currently quality is considered a key instrument in creating competitive advantage in the following ways: Being used as a strategic weapon together with reliability and price It takes a great deal of effort to rectify any poor reputation arising from competition. Quality is an attribute that can be learned and used in turn to improve performance of the organization Reputation on quality can spread very quickly and can make or break an organization It cost less to retain customers than to acquire new ones as a result damage due to poor quality Long term relationship is based on quality which is associated with profitability Loyal customers are likely to spend more time and money on an organization offering quality products and services A good proportion of customers come through referrals High quality prices are usually accompanied by premium prices.
Competitiveness denotes the ability of an organization to achieve market superiority and leadership .Competitiveness in quality is defines by the following characteristics 1. Its quality must be driven by customer needs and wants 2. The quality offering provides value that competitors cannot imitate 3. The quality has a significant contribution to the success of the organization 4. It allows the organization to match its unique resources and opportunities in the environment 5. It is durable and long lasting and difficult for competitors to achieve it. 6. It provides a basis for further improvements 7. It provides motivation for the entire organization
Quality Chains
Throughout and beyond the organization is a series of customer and supply relationship that are core to quality management. In any organization, there are both internal and external customers and suppliers who are interlinked. Effective management of quality in an organization therefore calls for the understanding of the quality chains and the following concepts should be considered: The organization should identify and treat its processes as a chain of suppliers and customers Quality should be managed throughout the organization and does not just happen 56
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Everyone must be involved in the process of managing quality Failure to meet customer requirements at any point in the organization chain has a multiplier effect Failure in any point in the chain creates problems elsewhere
Managing Quality Processes

Management of quality processes involves critical evaluation of activities with the aim of satisfying customers. A process is transformation of inputs into outputs that satisfies customer wants and needs. Process management therefore must be developed to developed deliver products /services and therefore should meet the following objectives: Satisfaction of customer wants Control of processes Continuous improvement
Processes can be classified into 1. Value creating processes: These are activities that are important to the success of an operation and thus create competitive advantage. They transform outputs into outputs of higher value. 2. Design processes: Sets of activities that are performed to incorporate customer requirements, new technologies and previous experiences into the functional specifications of the product or service 3. Product/Service delivery processes: are activities that converts inputs into outputs in form of products or service 4. Support Processes: Are activities that do not add value to the product/services but nonetheless provide infrastructure for value creation processes. Effective management of quality requires effective leadership. Any quality leader should have the following characteristics: They should give priority to both internal and external customers They empower rather than control subordinates They should emphasize prevention than correction They should encourage collaboration than competition They should train and couch rather direct and supervise Learn from mistakes and past experiences Continually communicate to the organization Demonstrate their commitment to the organization 57
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Use the systems approach to managing quality efforts Encourage and recognize team efforts.
The tasks of a quality leader therefore will include the following; 1. Defining and communicating the quality direction 2. Ensuring goals and expectations are met 3. Reviewing business/quality performance and taking any appropriate action 4. Creating a quality work environment that promotes creativity, innovation and continuous improvement. 5. Soliciting inputs and feedback from customers and employees 6. Encouraging everyone to contribute to quality improvement 7. Motivating, inspiring and energizing the employees 8. Recognizing and rewarding employees 9. Providing honest feedback. Leaders will therefore execute their tasks in the following areas Planning : Creation of the vision and mission statements Performance: Reviewing of results and taking corrective action Process: Encouraging the systems approach to management Leadership skills in people :Motivation, innovation, rewards Customers: identification of their needs and focus Commitment: Through commitment Culture: Creating value and ethics Communication : Encouraging organization wide understanding
Commitment and Policy in Quality Management

Effective promotion of quality in an organization in order to achieve effectiveness and efficiency must be through commitment which can be seen through the following; 1. Making quality management a truly organization wide activity 2. All senior managers must demonstrate their seriousness about quality e.g through time 3. The middle managers must understand the principles of quality management and must extend to explaining them to employees to whom they are responsible 4. Recognition, rewards and acknowledgement of subordinates is done when they deserve 5. The top management must accept responsibility for and be committed to the quality policy 6. The senior management commitment should be objective and not a lip service.
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Policies
A quality policy is a document jointly developed by management and quality experts to express the quality objectives of the organization, the acceptable level of quality and the duties of specific departments to ensure quality. Quality policies are general guidelines put in place by an organization to guide the quality of the organizations products and services. They should be stated clearly together with specifications on how they will be implemented, must be circulated to all employees and must provide a framework thet allows for regular improvements. A quality policy should be directed towards; Identification of customer wants Assessment of the organizations ability to meet customer needs Ensure that materials and services meets the required standard of performance and efficiency Concentrates on prevention rather than detection Educate and train for quality improvement Measure customer satisfaction Review quality management system to maintain quality processes.
A Quality Policy Statement as described by the University of Nairobi
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Topic 9: Historical Perspectives to Quality Management

The Evolution of Quality Management
Along with many other modern management practices QM originated and was developed within Japanese industry after the Second World War. Japan was a defeated nation with few natural resources and an inability to feed a population of 90 million, by its self. The future lay in successfully exporting consumer products across the world
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market, yet it had a reputation for shoddy goods and management systems that were described as "feudal" and "despotic". General Douglas McArthur realized the need for radical change and was responsible for the regeneration of the Japanese economy. Key to this was the dismissal of the old management and their systems, replacing them with younger men capable of making the changes needed to develop their economy. As a result the Union of Japanese Scientists and Engineers (JUSE) was formed, one of their first actions was to invite a well-known American statistician Dr. W. Edwards Deming, to present his ideas to them. Deming addressed the top business leaders in Japan, including managers from Companies which are now household names, Sony, Nissan, Mitsubishi and Toyota. They introduced new management methods, TQM being a key one. This led to Japan being the world leader in quality and productivity. Total Quality Management History: The tools and methods comprising TQM are not a new discovery. They have been around since Frederick Taylor developed the Principles of Scientific Management in 1911. TQMs key players and events: 1918: Dr. Franklin Bobbitt incorporates Taylors Principles of Scientific Management into his education model. Dr. Walter Shewhart, the Grandfather of TQM, is credited for development of the PDSA Cycle; Plan, Do, Study, Act, and Statistical Process Control; using statistics to determine the health of a process (Marshall 176). W. Edwards Deming, the quality guru, was the key to Japans economic comeback after World War II. The Japanese still use his version of the PDSA developed by Shewhart, and Demings 14 Points.
1930s TQM history The history of TQM starts with Elton Mayos Hawthorne experiments from 1927 through 1932. These experiments showed that workers participation in decision making improves productivity. In the 1930s, the Hawthorne plant of the Western Electric Company studied lighting levels, workday lengths, and rest period lengths to maximize productivity. During the lighting level studies, researchers found that when the lights were brighter, worker productivity increased. However when lighting level was decreased worker productivity also increased. 61
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This change in behavior from the employees is now called the Hawthorne effect. It basically states that when workers are involved in studies or decision making, productivity increases. Also during the 1930s, Walter Shewhart developed control charts. This is a statistical method to control processes. 1940s TQM History In the 1940s US was in World War II. Click here to review the History of the ISO 9001 standard. WWII pushed standardization, statistical control, and best manufacturing practices. 1950s History of Total Quality Management In the 1950s Edward Deming taught statistical methods and Dr Juran taught quality management techniques to the Japanese. Armand Feigenbaun wrote Total Quality Control. This became the first work that started many Total Quality Management theories. In 1954 Abraham Maslow created a pyramid of self actualization needs. In terms of work productivity, the lower levels of needs must be met prior to employees performing at higher levels. The needs in order are 1. Physiological which is to eat, sleep, and have shelter 2. Safety which is to have economic and physical security 3. Belonging which is to be accepted by family and friends 4. Esteem which is to be held in high regard 1. Self actualization which is to achieves ones best 1960s TQM History In the 1960s Douglas McGregor formed the Theory X and Theory Y leadership models. A Theory X leader applies a negative approach to management. They assume most workers really do not like to work and try to avoid work. A Theory Y leader believes workers want to do a good job. They believe workers will offer solutions to problems and participate in problem solving events. An involved employee is a productive employee.
1970s History of TQM In 1968 the Japanese shaped the phrase Total Quality Control. TQC is a companywide quality control philosophy. This philosophy drove Japan to the world quality leader in the 1970s. For the most part, Japan remains the quality leader. However the world has significantly closed the gap. 1980s History of TQM In the 1980 the U.S. Naval Air Systems coined the TQM phrase. The Navy based most of the principles on the Japanese Total Quality Control philosophy. Many companies adopted TQM 62
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during the 80s. TQM spread like wild fire. Many companies saw significant gains in productivity. However many companies started the program and failed miserably because they weren't willing to change. 1990s History of Total Quality Management In the 1990s' TQM evolved. Experts introduce new methods that supported TQM. These include Lean Manufacturing and Six Sigma. 2000s History of Total Quality Management In the 2000s, ISO revised ISO 9001 to focus more on business planning, quality management and continuous improvement. Other certification standards were created including AS9100 for aerospace, TS16949 for automotive, ISO 14001 for environmental, TL9000 for electronics, and ISO 17025 for laboratories. These standards all include the ISO 9001 elements.
The Elements of Total Quality Management

Total Quality Management is a management approach that originated in the 1950's and has steadily become more popular since the early 1980's. Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with processes being done right the first time and defects and waste eradicated from operations. To be successful implementing TQM, an organization must concentrate on the eight key elements: 1. Ethics 2. Integrity 3. Trust 4. Training 5. Teamwork 6. Leadership 7. Recognition 8. Communication KeyElements TQM has been coined to describe a philosophy that makes quality the driving force behind leadership, design, planning, and improvement initiatives. For this, TQM requires the help of those eight key elements. These elements can be divided into four groups according to their function. The 63
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groups are: I. Foundation -It includes: Ethics, Integrity and Trust. II. Building Bricks - It includes: Training, Teamwork and Leadership. III. Binding Mortar - It includes: Communication. IV. Roof - It includes: Recognition. I.Foundation TQM is built on a foundation of ethics, integrity and trust. It fosters openness, fairness and sincerity and allows involvement by everyone. This is the key to unlocking the ultimate potential of TQM. These three elements move together, however, each element offers something different to the TQM concept. 1. Ethics - Ethics is the discipline concerned with good and bad in any situation. It is a two-faceted subject represented by organizational and individual ethics. Organizational ethics establish a business code of ethics that outlines guidelines that all employees are to adhere to in the performance of their work. Individual ethics include personal rights or wrongs. 2. Integrity - Integrity implies honesty, morals, values, fairness, and adherence to the facts and sincerity. The characteristic is what customers (internal or external) expect and deserve to receive. People see the opposite of integrity as duplicity. TQM will not work in an atmosphere of duplicity. 3. Trust - Trust is a by-product of integrity and ethical conduct. Without trust, the framework of TQM cannot be built. Trust fosters full participation of all members. It allows empowerment that encourages pride ownership and it encourages commitment. It allows decision making at appropriate levels in the organization, fosters individual risk-taking for continuous improvement and helps to ensure that measurements focus on improvement of process and are not used to contend people. Trust is essential to ensure customer satisfaction. So, trust builds the cooperative environment essential for TQM. II. Bricks Basing on the strong foundation of trust, ethics and integrity, bricks are placed to reach the roof of recognition. It includes: 4. Training - Training is very important for employees to be highly productive. Supervisors are solely responsible for implementing TQM within their departments, and teaching their employees the philosophies of TQM. Training that employees require are interpersonal skills, the ability to function within teams, problem solving, decision making, job management performance analysis 64
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and improvement, business economics and technical skills. During the creation and formation of TQM, employees are trained so that they can become effective employees for the company. 5. Teamwork - To become successful in business, teamwork is also a key element of TQM. With the use of teams, the business will receive quicker and better solutions to problems. Teams also provide more permanent improvements in processes and operations. In teams, people feel more comfortable bringing up problems that may occur, and can get help from other workers to find a solution and put into place. There are mainly three types of teams that TQM organizations adopt: Quality Improvement Teams or Excellence Teams (QITS) - These are temporary teams with the purpose of dealing with specific problems that often re-occur. These teams are set up for period of three to twelve months. Problem Solving Teams (PSTs) - These are temporary teams to solve certain problems and also to identify and overcome causes of problems. They generally last from one week to three months. Natural Work Teams (NWTs) - These teams consist of small groups of skilled workers who share tasks and responsibilities. These teams use concepts such as employee involvement teams, self-managing teams and quality circles. These teams generally work for one to two hours a week. 6. Leadership - It is possibly the most important element in TQM. It appears everywhere in organization. Leadership in TQM requires the manager to provide an inspiring vision, make strategic directions that are understood by all and to instill values that guide subordinates. For TQM to be successful in the business, the supervisor must be committed in leading his employees. A supervisor must understand TQM, believe in it and then demonstrate their belief and commitment through their daily practices of TQM. The supervisor makes sure that strategies, philosophies, values and goals are transmitted down throughout the organization to provide focus, clarity and direction. A key point is that TQM has to be introduced and led by top management. Commitment and personal involvement is required from top management in creating and deploying clear quality values and goals consistent with the objectives of the company and in creating and deploying well defined systems, methods and performance measures for achieving those goals. III. Binding Mortar
7. Communication - It binds everything together. Starting from foundation to roof of the TQM house, everything is bound by strong mortar of communication. It acts as a vital link between all elements of TQM. Communication means a common understanding of ideas between the sender 65
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and the receiver. The success of TQM demands communication with and among all the organization members, suppliers and customers. Supervisors must keep open airways where employees can send and receive information about the TQM process. Communication coupled with the sharing of correct information is vital. For communication to be credible the message must be clear and receiver must interpret in the way the sender intended. There are different ways of communication such as: A. Downward communication - This is the dominant form of communication in an organization. Presentations and discussions basically do it. By this the supervisors are able to make the employees clear about TQM. B. Upward communication - By this the lower level of employees are able to provide suggestions to upper management of the affects of TQM. As employees provide insight and constructive criticism, supervisors must listen effectively to correct the situation that comes about through the use of TQM. This forms a level of trust between supervisors and employees. This is also similar to empowering communication, where supervisors keep open ears and listen to others. C. Sideways communication - This type of communication is important because it breaks down barriers between departments. It also allows dealing with customers and suppliers in a more professional manner. IV.Roof 8. Recognition - Recognition is the last and final element in the entire system. It should be provided for both suggestions and achievements for teams as well as individuals. Employees strive to receive recognition for themselves and their teams. Detecting and recognizing contributors is the most important job of a supervisor. As people are recognized, there can be huge changes in self-esteem, productivity, quality and the amount of effort exhorted to the task at hand. Recognition comes in its best form when it is immediately following an action that an employee has performed.
Recognition comes in different ways, places and time such as, Ways - It can be by way of personal letter from top management. Also by award banquets, plaques, trophies etc. Places - Good performers can be recognized in front of departments, on performance boards and also in front of top management. Time - Recognition can given at any time like in staff meeting, annual award banquets, etc. 66
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Conclusion We can conclude that these eight elements are key in ensuring the success of TQM in an organization and that the supervisor is a huge part in developing these elements in the work place. Without these elements, the business entities cannot be successful TQM implementers. It is very clear from the above discussion that TQM without involving integrity, ethics and trust would be a great remiss, in fact it would be incomplete. Training is the key by which the organization creates a TQM environment. Leadership and teamwork go hand in hand. Lack of communication between departments, supervisors and employees create a burden on the whole TQM process. Last but not the least, recognition should be given to people who contributed to the overall completed task. Hence, lead by example, train employees to provide a quality product, create an environment where there is no fear to share knowledge, and give credit where credit is due is the motto of a successful TQM organization.
Quality Gurus.
Quality GurusDr. W. Edwards Deming, Dr. Joseph Juran, Philip Crosby, Armand V. Feigenbaum, Dr. H. James Harrington, Dr. Kaoru Ishikawa, Dr. Walter A. Shewhart, Shigeo Shingo, Frederick Taylor, and Dr. Genichi Taguchihave made a significant impact on the world through their contributions to improving not only businesses, but all organizations including state and national governments, military organizations, educational institutions, healthcare organizations, and many other establishments and organizations. Dr. W. Edwards Deming (19001993) Dr. W. Edward Deming is best known for reminding management that most problems are systemic and that it is management's responsibility to improve the systems so that workers (management and non-management) can do their jobs more effectively. Deming argued that higher quality leads to higher productivity, which, in turn, leads to long-term competitive strength. The theory is that improvements in quality lead to lower costs and higher productivity because they result in less rework, fewer mistakes, fewer delays, and better use of time and materials. With better quality and lower prices, a firm can achieve a greater market share and thus stay in business, providing more and more jobs. When he died in December 1993 at the age of ninety-three, Deming had taught quality and productivity improvement for more than fifty years. His Fourteen Points, System of Profound Knowledge, and teachings on statistical control and process variability are studied by people all
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over the world. His books include: Out of the Crisis (1986), The New Economics (1993), and Statistical Adjustment of Data (1943). In emphasizing management's responsibility, Deming noted that workers are responsible for 10 to 20 percent of the quality problems in a factory, and that the remaining 80 to 90 percent is under management's control. Workers are responsible for communicating to management the information they possess regarding the system. Deming's approach requires an organization-wide cultural transformation. Deming's philosophy is summarized in his famous fourteen points, and it serves as a framework for quality and productivity improvement. Instead of relying on inspection at the end of the process to find flaws, Deming advocated a statistical analysis of the manufacturing process and emphasized cooperation of workers and management to achieve high-quality products. Deming's quality methods centered on systematically tallying product defects, analyzing their causes, correcting the causes, and recording the effects of the corrections on subsequent product quality as defects were prevented. He taught that it is less costly in the long-run to get things done right the first time then fix them later. The Rise of Deming's Influence The son of a small-town lawyer, Deming (a teacher and consultant in statistical studies) attended the University of Wyoming, University of Colorado, and Yale University, where he earned his Ph.D. in mathematical physics. He then taught physics at several universities, worked as a mathematical physicist at the U.S. Department of Agriculture and was a statistical adviser for the U.S. Census Bureau. From 1946 to 1993 he was a professor of statistics at New York University's graduate school of business administration, and he taught at Columbia University. Deming became interested in the use of statistical analysis to achieve better quality control in industry in the 1930s. In 1950 Deming began teaching and consulting with Japanese industrialists through the Union of Japanese Scientists and Engineers (JUSE). In 1960, he received the Second Order Medal of the Sacred Treasure from the Emperor of Japan for improvement of quality and the Japanese economy. In 1987 he received the National Medal of Technology from U. S. President Ronald Reagan because of his impact on quality in the United States.
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From 1946 to 1993, he was an international teacher and consultant in the area of quality improvement based on statistics, leadership, and customer satisfaction. The Deming Prize for quality was established in 1951 in Japan by JUSE and in 1980 in the United States by the Metropolitan Section of the American Society for Quality. American companies ignored Deming's teachings for years. In 1980, NBC aired the program "If Japan Can, Why Can't We?" highlighting Deming's contributions in Japan and American companies began to discover Deming. His ideas were used by major U.S. corporations as they sought to compete more effectively against foreign manufacturers. As a consultant, Deming continued to conduct Quality Management seminars until just days before his death in 1993. Deming's Fourteen Points Deming formulated the following Fourteen Points to cure (eliminate) the Seven Deadly Diseases and help organizations to survive and flourish in the long term: 1. Create constancy of purpose toward improvement of product and service. Develop a plan to be competitive and stay in business. Everyone in the organization, from top management to shop floor workers, should learn the new philosophy. 2. Adopt the new philosophy. Commonly accepted levels of delays, mistakes, defective materials, and defective workmanship are now intolerable. We must prevent mistakes. 3. Cease dependence on mass inspection. Instead, design and build in quality. The purpose of inspection is not to send the product for rework because it does not add value. Instead of leaving the problems for someone else down the production line, workers must take responsibility for their work. Quality has to be designed and built into the product; it cannot be inspected into it. Inspection should be used as an information-gathering device, not as a means of "assuring" quality or blaming workers. 4. Don't award business on price tag alone (but also on quality, value, speed and long term relationship). Minimize total cost. Many companies and organizations award contracts to the lowest bidder as long as they meet certain requirements. However, low bids do not guarantee quality; and unless the quality aspect is considered, the effective price per unit that a company pays its vendors may be understated and, in some cases, unknown. Deming urged businesses to move toward single-sourcing, to establish long-term relationships with a few suppliers (one supplier per purchased part, for example) leading to loyalty and opportunities for mutual improvement. Using multiple suppliers has been long justified for reasons such as providing protection against strikes or natural disasters or making the 69
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suppliers compete against each other on cost. However, this approach has ignored "hidden" costs such as increased travel to visit suppliers, loss of volume discounts, increased set-up charges resulting in higher unit costs, and increased inventory and administrative expenses. Also constantly changing suppliers solely on the base of price increases the variation in the material supplied to production, since each supplier's process is different. 5. Continuously improve the system of production and service. Management's job is to continuously improve the system with input from workers and management. Deming was a disciple of Walter A. Shewhart, the developer of control charts and the continuous cycle of process improvement known as the Shewhart cycle. Deming popularized the Shewhart Cycle as the Plan-Do-Check-Act (PDCA) or Plan-Do-Study-Act (PDSA) cycle; therefore, it is also often referred to as the Deming cycle. In the planning stage, opportunities for improvement are recognized and operationally defined. In the doing stage, the theory and course of action developed in the previous stage is tested on a small scale through conducting trial runs in a laboratory or prototype setting. The results of the testing phase are analyzed in the check/study stage using statistical methods. In the action stage, a decision is made regarding the implementation of the proposed plan. If the results were positive in the pilot stage, then the plan will be implemented. Otherwise alternative plans are developed. After full scale implementation, customer and process feedback will again be obtained and the process of continuous improvement continues. 6. Institute training on the job. When training is an integral part of the system, operators are better able to prevent defects. Deming understood that employees are the fundamental asset of every company, and they must know and buy into a company's goals. Training enables employees to understand their responsibilities in meeting customers' needs. 7. Institute leadership (modern methods of supervision). The best supervisors are leaders and coaches, not dictators. Deming high-lighted the key role of supervisors who serve as a vital link between managers and workers. Supervisors first have to be trained in the quality management before they can communicate management's commitment to quality improvement and serve as role models and leaders. 8. Drive out fear. Create a fear-free environment where everyone can contribute and work effectively. There is an economic loss associated with fear in an organization. Employees try to please their superiors. Also, because they feel that they might lose their jobs, they are hesitant to ask questions about their jobs, production methods, and process parameters. If a supervisor or manager gives the impression that asking such questions is a waste of time, then employees will be more concerned about pleasing their supervisors than meeting long-
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term goals of the organization. Therefore, creating an environment of trust is a key task of management. 9. Break down barriers between areas. People should work cooperatively with mutual trust, respect, and appreciation for the needs of others in their work. Internal and external organizational barriers impede the flow of information, prevent entities from perceiving organizational goals, and foster the pursuit of subunit goals that are not necessarily consistent with the organizational goals. Barriers between organizational levels and departments are internal barriers. External barriers are between the company and its suppliers, customers, investors, and community. Barriers can be eliminated through better communication, cross-functional teams, and changing attitudes and cultures. 10. Eliminate slogans aimed solely at the work force. Most problems are system-related and require managerial involvement to rectify or change. Slogans don't help. Deming believed that people want to do work right the first time. It is the system that 80 to 90 percent of the time prevents people from doing their work right the first time. 11. Eliminate numerical goals, work standards, and quotas. Objectives set for others can force sub-optimization or defective output in order to achieve them. Instead, learn the capabilities of processes and how to improve them. Numerical goals set arbitrarily by management, especially if they are not accompanied by feasible courses of action, have a demoralizing effect. Goals should be set in a participative style together with methods for accomplishment. Deming argued that the quota or work standard system is a short-term solution and that quotas emphasize quantity over quality. They do not provide data about the process that can be used to meet the quota, and they fail to distinguish between special and common causes when seeking improvements to the process. 12. Remove barriers that hinder workers (and hinder pride in workmanship). The direct effect of pride in workmanship is increased motivation and a greater ability for employees to see themselves as part of the same team. This pride can be diminished by several factors: (1) management may be insensitive to workers' problems; (2) they may not communicate the company's goals to all levels; and (3) they may blame employees for failing to meet company goals when the real fault lies with the management. 13. Institute a vigorous program of education and self improvement. Deming's philosophy is based on long-term, continuous process improvement that cannot be carried out without properly trained and motivated employees. This point addresses the need for ongoing and continuous education and self-improvement for the entire organization. This educational investment serves the following objectives: (1) it leads to better motivated employees; (2) it communicates the company goals to the employees; (3) it keeps the employees up-to-date 71
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on the latest techniques and promotes teamwork; (4) training and retraining provides a mechanism to ensure adequate performance as the job responsibilities change; and (5) through increasing job loyalty, it reduces the number of people who "job-hop." 14. Take action to accomplish the transformation. Create a structure in top management that will promote the previous thirteen points. It is the top management's responsibility to create and maintain a structure for the dissemination of the concepts outlined in the first thirteen points. Deming felt that people at all levels in the organization should learn and apply his Fourteen Points if statistical process control is to be a successful approach to process improvement and if organizations are to be transformed. However, he encouraged top management to learn them first. He believed that these points represent an all-or-nothing commitment and that they cannot be implemented selectively. The Deming Cycle Known as the Deming Plan-Do-Check-Act (PDCA) Cycle, this concept was invented by Shewhart and popularized by Deming. This approach is a cyclic process for planning and testing improvement activities prior to full-scale implementation and/or prior to formalizing the improvement. When an improvement idea is identified, it is often wise to test it on a small scale prior to full implementation to validate its benefit. Additionally, by introducing a change on a small scale, employees have time to accept it and are more likely to support it. The Deming PDCA Cycle provides opportunities for continuous evaluation and improvement. The steps in the Deming PDCA or PDSA Cycle as shown in Figure 1 are as follows: 1. Plan a change or test (P). 2. Do it (D). Carry out the change or test, preferably on a small scale. 3. Check it (C). Observe the effects of the change or test. Study it (S). 4. Act on what was learned (A). 5. Repeat Step 1, with new knowledge. 6. Repeat Step 2, and onward. Continuously evaluate and improve.
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Dr. Joseph Juran (B. 1904) Dr. Juran was born on December 24, 1904 in Braila, Romania. He moved to the United States in 1912 at the age of 8. Juran's teaching and consulting career spanned more than seventy years, known as one of the foremost experts on quality in the world. A quality professional from the beginning of his career, Juran joined the inspection branch of the Hawthorne Co. of Western Electric (a Bell manufacturing company) in 1924, after completing his B.S. in Electrical Engineering. In 1934, he became a quality manager. He worked with the U. S. government during World War II and afterward became a quality consultant. In 1952, Dr. Juran was invited to Japan. Dr. Edward Deming helped arrange the meeting that led to this invitation and his many years of work with Japanese companies. Juran founded the Juran Center for Quality Improvement at the University of Minnesota and the Juran Institute. His third book, Juran's Quality Control Handbook, published in 1951, was translated into Japanese. Other books include Juran on Planning for Quality (1988), Juran on Leadership for Quality (1989), Juran on Quality by Design (1992), Quality Planning and Analysis (1993), and A History of Managing for Quality (1995). Architect of Quality (2004) is his autobiography. Selected Juran Quality Theories Juran's concepts can be used to establish a traditional quality system, as well as to support Strategic Quality Management. Among other things, Juran's philosophy includes the Quality Trilogy and the Quality Planning Roadmap.
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Juran's QualityTrilogy.
The Quality Trilogy emphasizes the roles of quality planning, quality control, and quality improvement. Quality planning's purpose is to provide operators with the ability to produce goods and services that can meet customers' needs. In the quality planning stage, an organization must determine who the customers are and what they need, develop the product or service features that meet customers' needs, develop processes which are able to deliver those products and services, and transfer the plans to the operating forces. If quality planning is deficient, then chronic waste occurs. Quality control is used to prevent things from getting worse. Quality control is the inspection part of the Quality Trilogy where operators compare actual performance with plans and resolve the differences. Chronic waste should be considered an opportunity for quality improvement, the third element of the Trilogy. Quality improvement encompasses improvement of fitness-for-use and error reduction, seeks a new level of performance that is superior to any previous level, and is attained by applying breakthrough thinking. While up-front quality planning is what organizations should be doing, it is normal for organizations to focus their first quality efforts on quality control. In this aspect of the Quality Trilogy, activities include inspection to determine percent defective (or first pass yield) and deviations from quality standards. Activities can then focus on another part of the trilogy, quality improvement, and make it an integral part of daily work for individuals and teams. Quality planning must be integrated into every aspect of the organization's work, such as strategic plans; product, service and process designs; operations; and delivery to the customer. Philip Crosby (19262001) Philip Bayard Crosby was born in Wheeling, West Virginia, in 1926. After Crosby graduated from high school, he joined the Navy and became a hospital corpsman. In 1946 Crosby entered the Ohio College of Podiatric Medicine in Cleveland. After graduation he returned to Wheeling and practiced podiatry with his father. He was recalled to military service during the Korean conflict, this time he served as a Marine Medical Corpsman. In 1952 Crosby went to work for the Crosley Corp. in Richmond, Indiana, as a junior electronic test technician. He joined the American Society for Quality, where his early concepts concerning Quality began to form. In 1955, he went to work for Bendix Corp. as a reliability technician and quality engineer. He investigated defects found by the test people and inspectors. 74
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In 1957 he became a senior quality engineer with Martin Marietta Co. in Orlando, Florida. During his eight years with Martin Marietta, Crosby developed his "Zero Defects" concepts, began writing articles for various journals, and started his speaking career. In 1965 International Telephone and Telegraph (ITT) hired Crosby as vice president in charge of corporate quality. During his fourteen years with ITT, Crosby worked with many of the world's largest industrial and service companies, implementing his pragmatic management philosophy, and found that it worked. After a number of years in industry, Crosby established the Crosby Quality College in Winter Park, Florida. He is well known as an author and consultant and has written many articles and books. He is probably best known for his book Quality is Free (1979) and concepts such as his Absolutes of Quality Management, Zero Defects, Quality Management Maturity Grid, 14 Quality Improvement Steps, Cost of Quality, and Cost of Nonconformance. Other books he has written include Quality Without Tears (1984) and Completeness (1994). Attention to customer requirements and preventing defects is evident in Crosby's definitions of quality and "non-quality" as follows: "Quality is conformance to requirements; non-quality is nonconformance."
Crosby's Cost Of Quality.

In his book Quality Is Free, Crosby makes the point that it costs money to achieve quality, but it costs more money when quality is not achieved. When an organization designs and builds an item right the first time (or provides a service without errors), quality is free. It does not cost anything above what would have already been spent. When an organization has to rework or scrap an item because of poor quality, it costs more. Crosby discusses Cost of Quality and Cost of Nonconformance or Cost of Nonquality. The intention is spend more money on preventing defects and less on inspection and rework.
Crosby's Four Absolutes of Quality.

Crosby espoused his basic theories about quality in four Absolutes of Quality Management as follows: 1. Quality means conformance to requirements, not goodness. 2. The system for causing quality is prevention, not appraisal. 3. The performance standard must be zero defects, not "that's close enough." 75
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4. The measurement of quality is the price of nonconformance, not indexes. To support his Four Absolutes of Quality Management, Crosby developed the Quality Management Maturity Grid and Fourteen Steps of Quality Improvement. Crosby sees the Quality Management Maturity Grid as a first step in moving an organization towards quality management. After a company has located its position on the grid, it implements a quality improvement system based on Crosby's Fourteen Steps of Quality Improvement. Crosby's Absolutes of Quality Management are further delineated in his Fourteen Steps of Quality Improvement as shown below: Step 1. Management Commitment Step 2. Quality Improvement Teams Step 3. Quality Measurement Step 4. Cost of Quality Evaluation Step 5. Quality Awareness Step 6. Corrective Action Step 7. Zero-Defects Planning Step 8. Supervisory Training Step 9. Zero Defects Step 10. Goal Setting Step 11. Error Cause Removal Step 12. Recognition Step 13. Quality Councils Step 14. Do It All Over Again
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Armand V. Feigenbaum Feigenbaum was still a doctoral student at the Massachusetts Institute of Technology when he completed the first edition of Total Quality Control (1951). An engineer at General Electric during World War II, Feigenbaum used statistical techniques to determine what was wrong with early jet airplane engines. For ten years he served as manager of worldwide manufacturing operations and quality control at GE. Feigenbaum serves as president of General Systems Company, Inc., Pittsfield, Massachusetts, an international engineering firm that designs and installs integrated operational systems for major corporations in the United States and abroad. Feigenbaum was the founding chairman of the International Academy for Quality and is a past president of the American Society for Quality Control, which presented him its Edwards Medal and Lancaster Award for his contributions to quality and productivity. His Total Quality Control concepts have had a very positive impact on quality and productivity for many organizations throughout the industrialized world. Dr. H. James Harrington An author and consultant in the area of process improvement, Harrington spent forty years with IBM. His career included serving as Senior Engineer and Project Manager of Quality Assurance for IBM, San Jose, California. He was President of Harrington, Hurd and Reicker, a well-known performance improvement consulting firm until Ernst & Young bought the organization. He is the international quality advisor for Ernst and Young and on the board of directors of various national and international companies. Harrington served as president and chairman of the American Society for Quality and the International Academy for Quality. In addition, he has been elected as an honorary member of six quality associations outside of North America and was selected for the Singapore Hall of Fame. His books include The Improvement Process, Business Process Improvement, Total Improvement Management, ISO 9000 and Beyond, Area Activity Analysis, The Creativity Toolkit, Statistical Analysis Simplified, The Quality/Profit Connection, and High Performance Benchmarking. Dr. Kaoru Ishikawa (19151989) A professor of engineering at the University of Tokyo and a student of Dr. W. Edwards Deming, Ishikawa was active in the quality movement in Japan, and was a member of the Union of Japanese Scientists and Engineers. He was awarded the Deming Prize, the Nihon Keizai Press Prize, and the 77
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Industrial Standardization Prize for his writings on quality control, and the Grant Award from the American Society for Quality Control for his educational program on quality control. Ishikawa's book, Guide to Quality Control (1982), is considered a classic because of its in-depth explanations of quality tools and related statistics. The tool for which he is best known is the cause and effect diagram. Ishikawa is considered the Father of the Quality Circle Movement. Letters of praise from representatives of companies for which he was a consultant were published in his book What Is Total Quality Control? (1985). Those companies include IBM, Ford, Bridgestone, Komatsu Manufacturing, and Cummins Engine Co. Ishikawa believed that quality improvement initiatives must be organization-wide in order to be successful and sustainable over the long term. He promoted the use of Quality Circles to: (1) Support improvement; (2) Respect human relations in the workplace; (3) Increase job satisfaction; and (4) More fully recognize employee capabilities and utilize their ideas. Quality Circles are effective when management understands statistical techniques and act on recommendations from members of the Quality Circles. Dr. Walter A. Shewhart (18911967) A statistician who worked at Western Electric, Bell Laboratories, Dr. Walter A. Shewhart used statistics to explain process variability. It was Dr. W. Edward Deming who publicized the usefulness of control charts, as well as the Shewhart Cycle. However, Deming rightfully credited Shewhart with the development of theories of process control as well as the Shewhart transformation process on which the Deming PDCA (Plan-Do-Check or Study-Act) Cycle is based. Shewhart's theories were first published in his book Economic Control of Quality of Manufactured Product (1931). Shigeo Shingo (19191990) One of the world's leading experts on improving the manufacturing process, Shigeo Shingo created, with Taiichi Ohno, many of the features of just-in-time (JIT) manufacturing methods, systems, and processes, which constitute the Toyota Production System. He has written many books including A Study of the Toyota Production System From An Industrial Engineering Viewpoint (1989), Revolution in Manufacturing: The SMED (Single Minute Exchange of Die) System (1985), and Zero Quality Control: Source Inspection and the Poka Yoke System (1986).
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Shingo's greatness seems to be based on his ability to understand exactly why products are manufactured the way they are, and then transform that understanding into a workable system for low-cost, high quality production. Established in 1988, the Shingo Prize is the premier manufacturing award in the United States, Canada, and Mexico. In partnership with the National Association of Manufacturers, Utah State University administers the Shingo Prize for Excellence in Manufacturing, which promotes world class manufacturing and recognizes companies that excel in productivity and process improvement, quality enhancement, and customer satisfaction. Rather than focusing on theory, Shingo focused on practical concepts that made an immediate difference. Specific concepts attributed to Shingo are:
Poka Yoke requires stopping processes as soon as a defect occurs, identifying the source of the defect, and preventing it from happening again. Mistake Proofing is a component of Poka Yoke. Literally, this means making it impossible to make mistakes (i.e., preventing errors at the source). SMED (Single Minute Exchange of Die) is a system for quick changeovers between products. The intent is to simplify materials, machinery, processes and skills in order to dramatically reduce changeover times from hours to minutes. As a result products could be produced in small batches or even single units with minimal disruption.
Just-in-Time (JIT) Production is about supplying customers with what they want when they want it. The aim of JIT is to minimize inventories by producing only what is required when it is required. Orders are "pulled" through the system when triggered by customer orders, not pushed through the system in order to achieve economies of scale with the production of larger batches.
Frederick Taylor (18561915) An industrial (efficiency) engineer, manager, and consultant, Frederick Taylor is known as the Father of Scientific Management. In 1911, he published The Principles of Scientific Management. Taylor believed in task specialization and is noted for his time and motion studies. Some of his ideas are the predecessors for modern industrial engineering tools and concepts that are used in cycle time reduction. While quality experts would agree that Taylor's concepts increase productivity, some argue that his concepts are focused on productivity, not process improvement and as a result could cause less emphasis on quality. Dr. Joseph Juran said that Taylor's concepts made the United States the world leader in productivity. However, the Taylor system required separation of planning work from 79
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executing the work. This separation was based on the idea that engineers should do the planning because supervisors and workers were not educated. Today, the emphasis is on transferring planning to the people doing the work. Dr. Genichi Taguchi (B. 1924) Dr. Genichi Taguchi was a Japanese engineer and statistician who defined what product specification means and how this can be translated into cost effective production. He worked in the Japanese Ministry of Public Health and Welfare, Institute of Statistical Mathematics, Ministry of Education. He also worked with the Electrical Communications Laboratory of the Nippon Telephone and Telegraph Co. to increase the productivity of the R&D activities. In the mid 1950s Taguchi was Indian Statistical Institute visiting professor, where he met Walter Shewhart. He was a Visiting Research Associate at Princeton University in 1962, the same year he received his Ph.D. from Kyushu University. He was a Professor at Tokyo's Aoyama Gakuin University and Director of the Japanese Academy of Quality. Taguchi was awarded the Deming Application prize (1960), Deming awards for literature on quality (1951, 1953, and 1984), Willard F. Rockwell Medal by the International Technologies Institute (1986). Taguchi's contributions are in robust design in the area of product development. The Taguchi Loss Function, The Taguchi Method (Design of Experiments), and other methodologies have made major contributions in the reduction of variation and greatly improved engineering quality and productivity. By consciously considering the noise factors (environmental variation during the product's usage, manufacturing variation, and component deterioration) and the cost of failure in the field, Taguchi methodologies help ensure customer satisfaction. Robust Design focuses on improving the fundamental function of the product or process, thus facilitating flexible designs and concurrent engineering. Taguchi product development includes three stages: (1) system design (the non-statistical stage for engineering, marketing, customer and other knowledge); (2) parameter stage (determining how the product should perform against defined parameters; and (3) tolerance design (finding the balance between manufacturing cost and loss).
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The Use of These Gurus Theories And Principles To An Organization & Examples The principles and theories of the all the gurus are very useful to every organization today in the following ways:1. It will help Organization Management's function to optimize the whole system, not just your components. E.g., Western-style management: Reward-punishment performance appraisal systems optimize components of the system. E.g., Deming-style management: A better way is to evaluate an individual long-term virtue, to know if they are in the system or out of the system, and to understand the performance issues as special or common cause. According to statistical research by Deming, Ishikawa, and Juran over 80% of problems are related to common cause or system problem of the organization 2. It help Organization to Cooperation - works better than competition E.g., Western-style management: Internal competition to recognize the top 10% sales people in an organization creates a system where 90% of the population is labeled substandard performers or worse yet losers for those on the bottom half. E.g. In any distribution curve, 50% of the population is going to be below average, and only 10% are going to be top performers. It does not make sense to grow an organization of malcontents because nobody wants to label a loser. If the system is stable and has good hiring policies in place, a better way to manage is to have a goal to shift the distribution curve to the right by continuous improvement and removing common causes of variation. All employees in the system should be recognized for the accomplishments of the enterprise rather than just the top 10%. 3. It will help Organization to Manage using both a process and results orientation, not only a results orientation .E.g., Western-style management: Asking to sell 30% more (by a MBO goal) without understanding the process that allows that goal to be attained, or providing a process for goal attainment, creates a fail syndrome (demanding unreasonable greater results has the opposite effect that contradict the Pygmalion effect). E.g. A better way is to analyze historical performance using statistics. Then basing sales growth goals within +/- 3 standard deviations from the mean, where 99% of the sample population is predicted to attain the goal, and shifting the curve to the right by improving 81
Quality Management
the sales process. If a stable system is pushed beyond its limits, the system typically breaks down. 4. Organization will be able to motivated by a mix of intrinsic and extrinsic motivation E.g., Western-style management: Recognizing people solely through extrinsic motivation by giving plaques, letters of commendation, bonuses, and pats in the back to motivate employees. E.g. Joseph Juran styles of management, a better way is for management to combine extrinsic and intrinsic motivation to increase quality and pride in the work. Intrinsic motivation is the enthusiasm and positive stimulation an individual experiences from the sheer joy of an endeavor. Management can release intrinsic motivation by creating a culture that encourages employee involvement in using process improvement tools such as the Deming wheel (SDSA and PDSA) to innovate and improve quality. Other Usefulness of This Theories and Principles Are:
It will help an organization to attain total commitment from his management and to form a quality improvement team and thereby, creating metrics for each quality improvement activities.
An organization will be able to set is goals and objective on days schedule and determines the roots causes of the error and deal/remove that process. Help an organization to create a better reward system and to improve and innovate the condition of the society they operating in. To help an organization to create organization where workers will be able to enjoy in their working place and pride in the outcome of their works.
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Topic 10: The Future Quality Management

The quality movement provided a solid foundation on which many companies managed their return to strong growth following the difficult 1980s and early 1990s. These quality systems and processes have subsequently become major influences in businesses throughout Asia, Europe, Latin America, the Middle East and Africa. At the same time; however, powerful new global economic forces are radically changing the concepts of quality and how it was managed. These forces now make it essential that quality managers face the future with quality-based management programs that fit the new business era, rather than continuing with systems that may have worked in the recent past. Several trends will impact quality management future namely. Demanding customers By 2020, well over 1.5 billion men and women, and the companies that provide products and services to them, will make up an increasingly demanding customer base in common markets or regional trade alliances throughout the Americas, Asia, Europe and Africa. Moreover, this figure probably will increase as we proceed into the mid 21st century, now almost within the practical time horizon for realistic corporate business planning. At the heart of accelerating sales and market shares that pacesetter international companies enjoy today is an unflagging responsiveness to the demanding global customer. Surveys conducted by General Systems Co. indicate that when a global market consumer is satisfied with quality, he or she tells six others about the product or service; if that person is dissatisfied, 22 others hear about it. When it comes to transactions within industries, data show that a satisfied industrial customer is seven to eight times more likely to buy again from the same supplier than from its competitors. That is the power of complete quality satisfaction in todays markets. As this global economy reaches out to world businesses, it becomes clear that quality is becoming not only the international business language for worldwide trade networks but also that worldwide economic and social forces are fundamentally changing quality concepts and management. Improved quality now means an increase in value as well as right performance, service, design and economy for global customers. This differs from quality controls former focus on defect reduction alone. Understanding and speaking this new quality language -- and transforming quality processes accordingly -- is a principal goal of successful companies that are becoming sales growth and earnings profitability leaders in the new global economy. A closer look at the global economic, social and trade forces upon which these companies have been built can offer some insight into their success. 83
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Shifting customer value expectations Perhaps most important is the fundamental shift in customer value expectations in the global marketplace. Ongoing surveys of customer buying patterns throughout major international markets indicate that nine out of 10 buyers make quality their primary purchasing standard, as compared with three or four out of 10 two decades ago. As customers, they increasingly approach quality as a buying discipline, which they measure by their total-value perception of the product as well as the organization that produces it. This means that the quality of the steel or the merchandising service customers receive is an important part -- but just a part -- of the complete support, billing accuracy and delivery reliability package they expect to buy. For example, routinely and properly washing automobiles as part of a dealer service call is a simple but nonetheless expected service that many customers identify as a value differentiator. The service shows that the dealer cares, and customers appreciate saving the time and effort. They assume, correctly or incorrectly, that a responsible dealer can accomplish any technical action. Similarly, the voluntary elimination by a mobile communications company of a few dead spots on a main trucking route is one of the primary buyer-value reasons customers cite for their return sales with that company rather than with its competitors. For consumers, this attitude is driven by a need to improve their standard of living. For business buyers, its driven by economic pressures that demand reliable, predictable equipment and services without time-consuming failures or other hidden costs. These buyers expect a level of quality that is essentially perfect for their needs, affordable and user-determined. This demand for complete customer satisfaction indicates a profound social shift for both global consumers and business buyers. Organizations that continue to concentrate solely on defect reduction overlook their customers new buyer-value expectations. This is most evident in the disparity between many companies quality satisfaction measurements. Some companies point proudly to their quality improvement data -- i.e., defect reduction -- even as customer surveys indicate that buyers believe quality has not improved -- i.e., increased in quality value -- and they are therefore curtailing their business with these companies. Economic pressures Another force is the overwhelming economic pressure on organizations. Like a giant pair of scissors, the pressure closes in on many of them from opposing directions. One is the strong upward pressure due to increasing costs despite concerted containment efforts; the other is a severe 84
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downward pressure on the price of goods due to market changes. To compound matters, even after years of cost accounting, many organizations still dont know what things really cost as a foundation for true cost reduction. For example, some companies have adopted a slash-and-burn cost-reduction approach. However, unless its synchronized with specific improvements in process, cost reduction produces the same results as weight reduction without a change in lifestyle: It does not stick. Instead, it leads to more cost reduction, more restructuring and corporate-navel contemplating. As a result, these companies become out of touch with rapid changes in new markets, new employee attitudes and new management approaches. The key is to directly link customer value enhancement with cost. Improving quality also improves an organization overall -- from marketing and design to operations and distribution. Therefore, cost must include not only operations and sales but also delivering customer satisfaction. General Systems survey data show that, at many companies, this accounts for as much as 25 percent of sales, much of it for quality failures. For companies in which total quality has been correctly managed, the figure is 10 percent or less. Total quality initiatives have established teamwork processes that, by improving quality for customers, have greatly reduced the costs accrued from failing to deliver customer satisfaction. These reductions help support quality value-enhancement programs as well as bottom-line net operating income. Shareholders and investors can understand such reductions. New management approaches These two forces -- the shift in customer value expectations and new economic pressures -- lead to a third force: innovative management approaches to human leadership. These approaches reject the notion that good management and successful improvement means getting the ideas out of the bosss head and into the workers hands. Organizations that embrace this approach to business improvement become increasingly estranged from their customers, employees and suppliers. Top-down planning only serves to isolate organizations from their customers buying habits. It encourages an atmosphere of intimidation with suppliers rather than a partnership. Under the old-school management regime, human resource improvement programs hardly fare better. They are keyed to flashy motivational seminars, combined with regular doses of management speech making. But when employees return to their jobs to apply what they have 85
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heard, they face the same old ambiguous management practices and continue to thread their way through autonomous departmental islands without any bridges between them. A very different foundation for business success will characterize competitive organizations in the future. These quality leadership companies will: Make quality the epicenter of increasing revenue growth and competitive leadership. Achieve complete customer satisfaction by offering essentially perfect goods and services whose quality the customer determines. Accelerate sales and earnings growth through quality failure reduction. Innovate in product and service leadership and cycle-time management. Restore jobs by using tools and resources to encourage employee participation in quality improvement. Develop effective supplier partnerships. Create a seamless quality value network among customer, producer and supplier relationships. Provide environmental and safety leadership. Ensure that quality remains the companys international business language.
Companies that cant implement these processes wont travel under any single national passport nor any particular cultural or social identity. But they will share certain quality management characteristics. In particular, they will: Consider their basic objective as continuously accelerating value for customers, investors and employees. Emphasize that a market-driven means quality according to what their customers, not the company, say it is. Lead by a combination of passion, discipline and populism, with a bias for improvement and an emphasis on communication. Recognize that sustained growth demands increasing customer satisfaction, cost leadership, human resource effectiveness and integration with their supplier base -- all four, all the time. 86
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Foster a deep commitment to fundamental business improvement through knowledge, skills, democratic problem solving and teamwork.
These characteristics will provide improved quality to customers and help organizations successfully face the social and economic changes that are ushering in a new global business climate.
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Quality Management

Kenya Institute of Management

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Chance Favors the Prepared Mind- Marie Sklodowska Curie (1867-1934)

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Quality and Quality Management

Principles of Quality Management

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

The Role of Society in Sustaining Quality Practices

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Stakeholders (Anybody who has interest)

Impact of Quality Services on Institutions/Society

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

TOPIC 2: QUALITY AND THE ENVIRONMENT

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

SIGNED: JOSEPH N. KOSURE AG. CHIEF EXECUTIVE OFFICER

Environmental Management Systems

Business and Environment

Basic Concepts of Environmental Management

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

ISO 14000 Family of Standards

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Benefits of Implementing ISO 14000 EMS

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Topic 3: WORKPLACE CULTURE

Kenya Institute of Management

Prepared By: Stanley Cheruiyot

Friends of Quality Culture: