This action might not be possible to undo. Are you sure you want to continue?
is to produce quality product or services efficiently. As a result of this, many firms embraced TQM • TQM History – TQM began in 1970s when Japan had to rebuilt its industrial base as a result of WWII. With the help of American consultants Edward Deming and Joseph Juran, Japan began making quality as a competitive priority. • Deming believed that quality is the responsibility of the management, not the worker • Juran believed that quality depends on continuous improvement, hands-on management, and training • TQM Definition – a philosophy that stresses three principles – customer satisfaction, employee involvement, and continuous improvements in quality. TQM also involves benchmarking, product and service design, process design, purchasing, and problem solving tools. Customer Satisfaction • Quality has multiple dimensions in the mind of the customer, and one or more of the following definitions may apply at any one time • Conformance to specification • Customers expect products/services they buy to meet or exceed certain advertised levels of performance • Example: quality = if online order comes within specified delivery time • Value • How well the product/service serves its intended purpose at a price customers are willing to pay • Depends on customers’ expectations before purchase • Example: quality = if a $2 pen serves for a year • Fitness for use • How well the product/service performs its intended purpose • Based on mechanical features of the product, convenience of service, appearance, style, durability, reliability, craftsmanship, and serviceability • Example: quality = if it was easy to assemble a desk and if it served well • Support • Product or service support provided by the company • Good support reduces the consequences in quality failures • Example: quality = computer repair free of charge • Psychological impression • Customers evaluate the quality on the basis of atmosphere, image, or aesthetics • Example: quality = nicely dressed, friendly and sympathetic employees
Katerina Stecova Nakia Madry Employee Involvement • A complete program in employee involvement includes changing organizational culture, encouraging teamwork, fostering individual development through training, and establishing awards and incentives • Cultural Change – if TQM is to be achieved, the organizational culture should stress the importance of: • Defining customer for each employees • All employees must do a good job of serving their internal customers if external customers are to be satisfied • External – people/firms buying the product/service • Internal – employees in the firm who rely on the output of other employees • Practicing the philosophy of “quality at source” • Errors should be caught and corrected at source, not passed along to an internal customer • Teams – small groups of people who have a common purpose, set their own performance goals and approaches, and hold themselves accountable for success. • There are three approaches to teamwork • Problem-solving teams – small groups of supervisors and employees who meet to identify, analyze, and solve production and quality problems • Special purpose teams – groups that address issues of paramount concern to management, labor, or both • Self-managing teams – small group of employees who work together to produce a major portion, or sometimes all, of a product or service • Individual Development – on-job training programs help improve quality • Teaching new work methods to experienced workers • Teaching current practices to new employees Continuous Improvement • Philosophy of continually seeking ways to improve operations, based on a Japanese concept called kaizen • Steps for Achieving Continuous Improvement • Train employees in the methods of statistical process control and other tools in improving quality and performance • Make SPC method a normal aspect of daily operations • Build work teams and employee involvement • Utilized problem-solving tools within the work teams • Develop a sense of operator ownership in the process Improving Quality Through TQM
Katerina Stecova Nakia Madry • • Purchasing Considerations – successful company with TQM must identify suppliers with high-quality products/services at a reasonable price because the quality of supplied products/services affects the quality of firm’s work Product/Service Design – design changes increase defect rates; therefore, in order to keep quality high, the firm needs to carefully test new designs and redesigns. In addition, while designing or redesigning the product/service, the firm needs to focus on the market in order to satisfy the customers Process Design – operations managers must work closely together with designers in the initial phase of product/design to ensure that production requirements and process capabilities are synchronized, which results in a better quality and shorter development time Benchmarking – it is a continuous, systematic procedure that measures a firm’s products, services, and processes against those of industry leaders. It is done through planning, analysis, integration, and action Problem-Solving Tools – in order to improve the quality of operations, data must be collected and analyzed. This can be done with the help of checklists, histograms, bar charts, pareto charts, scatter diagrams, cause-and-effect diagrams, and graphs
Quality Awards and Standards • Malcolm Baldridge National Quality Award – an award named for the late secretary of commerce, who was a strong proponent of enhancing quality as a means of reducing the trade deficit. • The award promotes, recognizes, and publicizes quality strategies and achievements • Up to two awards are given each year in three categories – large manufacturers, large service companies, and small businesses (manufacturing or service) • Recipients include Motorola, 3M, Federal Express, and Merrill Lynch • ISO 9000 – a set of standards governing documentation of a quality program • Certified companies indicate to customers that they can provide documentation to support claims they make about quality • ISO 14000 – documentation standards that required participating companies to keep track of their raw materials use and their generation, treatment, and disposal of hazardous waste Example of TQM • Parkroyal Hotel in New Zeland • Luxury hotel with 297 guest rooms, three restaurants, three lounges, and 338 employees serving 2,250 guests each week • Prior to guests arrival, reservation staff gathers information about the guest’s likes and dislikes in order to customize the service that each guests receives. Receptionists, servers, cooks and other employees live up to the standards of quality that distinguishes Parkroyal from its competition
Katerina Stecova Nakia Madry • Level of quality is sustained through: • Empowering employees to take preventive or corrective actions without management approval • Use of charts, histograms, and other graphs to track performance and identify areas needing improvement • In the restaurants, photos of finished dishes remind employees of presentation and content • Employee recruiting, training, and motivation