Quality Management – Introduction

Relevance of Quality Concept

Nothing would drive home the relevance of quality in cost management than the
major instances of defective products in the recent past.

a) Nokia branded BL-5C Battery : 100 incidents of over- heating of the battery
were reported worldwide which could result in short circuit while charging,
causing the battery to dislodge. Nokia deemed it fi t to recall all such
batteries and issued a product advisory offering to replace the batteries
free of cost. 46 million batteries were estimated to be replaced and the
cost to Matsushita which manufactured the batteries was dollars 172
million.
b) In 2006 Sony was hit by hefty cost for the recall of 9.6 million PC batteries
that could overheat and catchfire.
c) In May 2001 Ford had to recall 1.3 million tyres at a cost of $ 2.1 billion,
marking the end of its 100 year relationship with US tyre maker Firestone.
d) In December 2000 Ford recall 876,413 Explorers and Mercury
Mountaineers to replace faulty parts on the suspension system.

The magnitude of monitory losses, not to speak of the dent to the company’s
image will highlight the importance of ensuring total quality in products; nothing
short of a eternal vigilance is an imperative need.

Quality thus is Cost and Quality Control and Cost Control are in fact the obverse
and reverse of the same coin. The emphasis should be on prevention of errors
and failures through Quality Planning. Investments in Quality Control will yield
rich returns to the manufacturer through savings in materials and man-hours lost,
improving productivity and above all profitability through customer satisfaction.

Historical Review of Quality Control

With increase in technology development and the consequent diversity of

products, the need for professionalism in every function became paramount. This
led to a separate group of professionals for quality control.
a) In 1924 – Dr.W.A. Shewart of Bell Telephones, USA, introduced statistical
control charts to control product variability during process.
b) 1940’s Quality associations and societies come into being to spearhead and
promote Quality.
i) American Society for Quality Control was established in 1946.
ii) The Japanese established Union of Japanese Scientists and Engineers
(JUSE) which promoted Quality and Total Quality and Total Quality
Control in Japan and formed a Quality Control Research group under
its wing. Dr. K. Ishikawa was one of the members of that group.
iii) Though Indian Statistical Institute was established in 1931 it became
active in 1940’s thanks to the efforts of Prof. Mahalanobis, who
served as Director of ISI.

c) In 1950s Dr. W. E. Edwards, one of the Statistical experts was invited to

Japan and he taught the captains of Industry there Statistical Quality
Control and the grateful Japanese instituted a medal in his name called
“Deming Medal” be awarded every year for the best organizations
practicing Quality and TQC.

d) In 1954 Dr. J. M. Juran went to Japan of the invitation of JUSE. He

emphasized that Quality control should be a part of management control
and that top management’s leadership is essential for achievement of
Quality. In fact, that was the beginning of development of Japanese
company wide quality control (CWQC) which they have now christened as
Company Wide Total Quality Management (CWTQM).

e) 1950’s saw revolution in nation wide promotion of Quality control in Japan

and JUSE, under the leadership of Dr. K. Ishikawa conceived a concept
called Quality Control Circles, a team concept, to educate and train bottom
line workers and enable them to build Quality into the products and take
care of quality problems solvable by them. This system had world-wide
acceptance.

f) 1970’s – After the Japanese Quality revolution, the American Company’s

started to have a new look at Dr. Deming’s and Dr. Juran’s teachings on
Quality.
 g) 1980’s – This period saw a renaissance of Quality and promotion of Quality
awareness and education. This period also had been credited with the
development of TQM and its promotion world wide. In the late 1980s
automotive industries, on seeing the fierce competition from the Japanese
automobile industries, adopted application of Statistical Quality Control
Techniques to improve quality.

In 1987 ISO 9000 Quality Systems Standards came into being and it was
accepted as a global Quality Systems Standard and from 1990s certifi cation
become a necessity among trading countries for their products.

h) 1990’s – ISO 9000 came to be accepted as global model for Quality

management system and this followed by Environmental Management
System (EMS) ISO 14000 and occupational safety and hazard system
(OSHAS) ISO 18000.

i) 2000 – In the new millennium Quality has become the key to success of any
organization. Many awards for Quality come into being (i) Malcolm Bald
ridge Award (ii) European Quality Award and (iii) Deming Award.

Quality Gurus

Joseph Juran

Joseph Juran is an internationally acclaimed quality guru, strongly infl uencing

Japanese manufacturing practices. Joseph Juran’s belief that “quality does not
happen by accident” gave rise to the quality trilogy:
• Quality planning
• Quality control
• Quality improvement

The key steps in implementing company-wide strategic goals are:

• Identify customers and their needs – both internal and external – and work
to meet those needs
• Create measures of quality, establish optimal quality goals and organise to
meet them.
 • Create processes capable of meeting quality goals in “real” operating
conditions.

Joseph Juran recognised that the common approach to total quality management
- quality awareness campaigns and slogans - was not effective as they did not
have substance, and there is no short cut to quality. He believes quality must start
at the top.

Juran’s Trilogy could be better understood with the following expansion:

Quality Planning Quality Control Quality Improvement

• Determine who are • Choose control subjects • Establish the
the customers – what to control? infrastructure needed to
• Determine the needs • Choose units of secure annual quality
of the customers measurements–Evaluate improvement
• Develop product Measurements • Identify the specific needs
features that respond • Establish standards of for improvement – the
to the customers’ performance improvement projects
needs. • Measure actual • For each project establish
• Develop processes performance a project team with clear
that are able to product • Interpret the difference responsibility for bringing
those product features (actual versus standard) the project to a successful
• Transfer the resulting • Take action on conclusion
plans to the operating difference • Provide the resources,
forces. motivation, and training
needed by the teams to:
• Diagnose the causes
• Stimulate establishment
of a remedy
• Establish controls to hold
the gains

Deming Philosophy or Deming’s Fourteen Points for Top Management

1. Create Constancy of purpose towards improvement of products and

services, with the aim to become competitive and stay in business and to
 provide jobs. Decide to whom the top management is responsible (all the
stake holders, of course).

2. Adopt the new philosophy – we are in a new economic age. We can no

longer live with the commonly accepted levels of delays, mistakes,
defective materials and defective workmanship.

3. Cease dependence on inspection to achieve quality - Eliminate the need of

inspection on a mass basic (i.e. 100% inspection) by building quality into the
product in the fi rst place. (This is possible by educating task performers in
the use of Quality control tools and techniques to eliminate mistakes from
happening and involving them in quality control in their work areas).

4. End the practice of amending business (contract for material supplies) on

the basis of price tag. (i.e. lowest tenders against a tender). Instead depend
on meaningful measures of quality along with price. (evaluate venders
against a set of norms fi rst and consider price later).

5. Constantly improve the system of production and service. (i.e. constantly

and periodically review design and technological processes and build in
customer requirements and improve the economic costs of management).

6. Institute training on the job. (technologies are fast changing and therefore,
people are to be trained continuously to update their knowledge and skills).

7. Institute leadership (Management should build a superior vision to bring

out the best in people by facilitation). The supervision should be to help
people, machines and gadgets to do a better job (Practice of preventive
maintenance). Supervision of management is in need of improvement, as
well as supervision of hourly workers.

8. Drive out fear so that everyone will work effectively for the company. (Fear
thwarts people from giving their ideas. On the contrary empowerment will
enable employees to freely come up with creative ideas for the
improvement of their jobs).
9. Breakdown barriers between departments. (not seeing eye to eye between
departmental managers has led to water-tight compartment working
instead of common objectives and goals of the organization). People in
research, design, sales and production must work as a team to foresee
problems of production that may be encountered with various materials
and specifications.

10.Eliminate slogans; exhortations and targets for the work force asking for
zero defects and new levels of productivity with providing maps. (instead,
the suggestion is to involve them in the planning process and setting goals
of the company jointly so that their commitment is obtained).

11.Eliminate work standards that prescribe numerical quotas for the day.
(Dr.Deming is of the opinion that work standards and quotas of production
for day curbs initiative and creativity of the work force, who may give much
better, qualitative out-put).

12.The barriers that stand between hourly worker and his pride to
workmanship. The responsibility of the foremen should be changed from
sheer quantity to quality.

Do the same thing for people in management. This can be accomplished by

the elimination of the rating on performance. (Instead, enhance their
performance capabilities through continuous education and training and
motivate them to higher levels of performance).

13.Institute vigorous programme of education and training and retraining

(continual basis, periodically).

14.Create a structure in management to accomplish the transformation

(create a top management care group to bring about the transformation).
Kaoru Ishikawa - Quality Circles

Kaoru Ishikawa led the concept and use of Quality Circles. The intended purpose
of a Quality Circle is to;
• Support the improvement and development of the company
• Respect human relations in the workplace and increase job satisfaction
• Draw out employee potential

He believed quality must be company wide – including the product, service,

management, the company itself and the people. Quality improvement must be
company wide in order to be successful and sustainable.

He led the “Total Quality Control” movement with focus on statistical quality
control techniques such as control charts and Pareto charts.

Many, including Juran and Crosby, consider Kaoru Ishikawa’s teachings to be

more successful in Japan than in the West. Quality circles are effective when
management understand statistical quality management techniques and are
committed to act on their recommendations.

Philip Crosby – “Zero Defects” and “Right First Time”

Philip Crosby is an American who promoted the phrases “zero defects” and “right
first time”. “Zero defects” doesn’t mean mistakes never happen, rather that there
is no allowable number of errors built into a product or process and that you get
it right first time.

Philip Crosby believes management should take prime responsibility for quality,
and workers only follow their managers’ example. He defined the Four Absolutes
of Quality Management.

The Four Absolutes of Quality Management

1. Quality is conformance to requirements

2. Quality prevention is preferable to quality inspection
3. Zero defects is the quality performance standard
4. Quality is measured in monetary terms – the price of non-conformance
Crosby’s 14 Steps to Quality Improvement

1. Management is committed to quality – and this is clear to all

2. Create quality improvement teams – with (senior) representatives from all
departments.
3. Measure processes to determine current and potential quality issues.
4. Calculate the cost of (poor) quality
5. Raise quality awareness of all employees
6. Take action to correct quality issues
7. Monitor progress of quality improvement – establish a zero defects
committee.
8. Train supervisors in quality improvement
9. Hold “zero defects” days
10.Encourage employees to create their own quality improvement goals
11.Encourage employee communication with management about obstacles to
quality
12.Recognise participants’ effort
13.Create quality councils
14.Do it all over again – quality improvement does not end

Philip Crosby has broadened his approach to include wider improvement ideals.

He defined the:

Five characteristics of an “Eternally Successful Organisation”

1. People routinely do things right first time

2. Change is anticipated and used to advantage
3. Growth is consistent and profi table
4. New products and services appear when needed
5. Everyone is happy to work there