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EMMANUEL NELSON BASSEY
A TERM PAPER WRITEN IN PARTIAL FULFILLMENT FOR THE COURSE PRODUCTION MANAGEMENT HND 11, BUSINESS ADMINISTRATION, DEPARTMENT OF BUSINESS STUDIES. AKWA IBOM STATE POLYTECHNIC. IKOT OSURUA- IKOT EKPENE.
AKWA IBOM STATE.
ABSTRACT Today's competitive market, in almost every category of products and services, is characterised by accelerating changes, innovation, and massive amounts of new information. Much of this rapid evolution in markets is fueled by changing customer needs. Significant customer behavior and market changes happen almost overnight. Changes in market preference or technology, which used to take years, may now take place in a few months. As the pace of change accelerates, it becomes more difficult to maintain stable relationships with suppliers, customers, brokers, distributors, and even your own company personnel. "Putting out fires" and reacting to new emergencies is unfortunately the norm for many large and small companies caught in the whirlpool of technological change. Total Quality Management (TQM) is a business management strategy aimed at embedding awareness of quality in all organizational processes. There are several keys to a successful TQM program for business organisation: Quality work and customer satisfaction must be a commitment of all
Improving quality and customer satisfaction must also be a commitment of all
Every company activity must incorporate quality and customer satisfaction,
including all communications with customers and suppliers.
It doesn't have to cost more to make quality and customer satisfaction your
Significant changes may be required to make quality and customer
Small advantages in all company functions can set your quality and customer
satisfaction apart from the competition. In this term paper, the writer began with introduction, followed with the review of the related literature on the relevant materials on the subject matter. The summary and conclusion brought the write-up the end.
TABLE OF CONTENTS Abstract….2 Table of content…..4 3
Unit 1……..5 Introduction…5 Definition………5 Origins……7 Customer-driven quality…..9 Continuous improvement…….10 Fast response……..11 Unit 2…….14 Literature review……14 Total quality management……14 TQM as a foundation…….16 Ten steps to total quality management…….17 Key to quality…….18 Six questions six graphs for planning a change….19 Company philosophy ….21 Quality methods…..24 Unit 3 ……..25 Summary…..25 Unit 4…….26 Conclusion…..26 References……27
Total Quality Management is an approach to the art of management that originated in Japanese industry in the 1950's and has become steadily more popular in the West since the early 1980's.
Total Quality Management is the organization-wide management of quality. Management consists of planning, organizing, directing, control, and assurance. Total quality is called total because it consists of two qualities: quality of return to satisfy the needs of the shareholders, or quality of products. As defined by the International Organization for Standardization (ISO): "TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organization and to society." ISO 8402:1994 One major aim is to reduce variation from every process so that greater consistency of effort is obtained. (Royse, D., Thyer, B., Padgett D., & Logan T., 2006) In Japan, TQM comprises four process steps, namely:
1. Kaizen – Focuses on "Continuous Process Improvement", to make processes
visible, repeatable and measurable.
2. Atarimae Hinshitsu – The idea that "things will work as they are supposed to"
(for example, a pen will write).
3. Kansei – Examining the way the user applies the product leads to
improvement in the product itself.
4. Miryokuteki Hinshitsu – The idea that "things should have an aesthetic quality"
(for example, a pen will write in a way that is pleasing to the writer). TQM requires that the company maintain this quality standard in all aspects of its business. This requires ensuring that things are done right the first time and that defects and waste are eliminated from operations. Total Quality Management continues to evolve in the form of the Criteria for Performance Excellence which was first published in 1988. The criteria provide the basis for the Baldrige National Quality Program (BNQP) that is administered by the National Institute of Standards and Technology (NIST). Organizations benchmark against the criteria to assess how well their actions are aligned with their strategies. Results are examined to determine the effectiveness of their approaches and deployment of these strategies. Dr. Juran once stated that the Criteria for Performance Excellence is the embodiment of those philosophies and practices we call TQM.
ORIGINS The origin of the expression Total Quality Management is unclear. Bill Creech claims to have coined the phrase in his book The Five Pillars of TQM,
comparing the functionally centralised approach to organisation (with examples from America) with the team-oriented, decentralised approach pioneered in Japan after World War II. "Total Quality Control" was the key concept of Armand Feigenbaum's 1951 book, Quality Control: Principles, Practice, and Administration. In a chapter titled "Total Quality Control" Feigenbaum grabs on to an idea that sparked many scholars' interest in the following decades. The expression Total Quality Control existed together with the Japanese expression "Company Wide Quality Control" (CWQC) and the differences between the two expressions were unclear. Major influencers for both expressions were W. Edwards Deming, Joseph Juran, Philip B. Crosby, and Kaoru Ishikawa, known as the big four. The expression Total Quality Management started to appear in the 1980s and there are two theories of its origin: One theory is that Total Quality Management was created as a
misinterpretation from Japanese to English since no difference exists between the words "control" and "management" in Japanese.
. According to William
Golomski (American quality scholar and consultant, 1924-2002) TQM was first mentioned by Koji Kobayashi at NEC (Nippon Electrical Company) in his speech when he received the Deming Prize in 1974. The American Society for Quality says that the term Total Quality Management was used by the U.S. Naval Air Systems Command in 1984 to describe its Japanese-style management approach to quality improvement since they did not like the word control in Total Quality Control. The word management should
then have been suggested by one of the employees, Nancy Warren. This is consistent with the story that the United States Navy Personnel Research and Development Center began researching the use of statistical process control (SPC), the work of Juran, Crosby, and Ishikawa, and the philosophy of W. Edwards Deming to make performance improvements in 1984. This approach was first tested at the North Island Naval Aviation Depot. Total Quality is a description of the culture, attitude and organization of a company that aims to provide, and continue to provide, its customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with things being done right first time, and defects and waste eradicated from operations.
Many companies have difficulties in implementing TQM. Surveys by consulting firms have found that only 20-36% of companies that have undertaken TQM have achieved either significant or even tangible improvements in quality, productivity, competitiveness or financial return. As a result many people are sceptical about TQM. However, when you look at successful companies you find a much higher percentage of successful TQM implementation.
Some useful messages from results of TQM implementations:
if you want to be a first-rate company, don't focus on the second-rate companies who can't handle TQM, look at the world-class companies that have adopted it
the most effective way to spend TQM introduction funds is by training top management, people involved in new product development, and people involved with customers
Important aspects of TQM include customer-driven quality, top management leadership and commitment, continuous improvement, fast response, actions based on facts, employee participation, and a TQM culture.
Customer-driven quality. TQM has a customer-first orientation. The customer, not internal activities and constraints, comes first. Customer satisfaction is seen as the company's highest priority. The company believes it will only be successful if customers are satisfied. The TQM company is sensitive to customer requirements and responds rapidly to them. In the TQM context, `being sensitive to customer requirements' goes beyond defect and error reduction, and merely meeting specifications or reducing customer complaints. The concept of requirements is expanded to take in not only product and service attributes that meet basic requirements, but also those that enhance and differentiate them for competitive advantage.
Each part of the company is involved in Total Quality, operating as a customer to some functions and as a supplier to others. The Engineering Department is a supplier to downstream functions such as Manufacturing and Field Service, and has to treat these internal customers with the same sensitivity and responsiveness as it would external customers.
TQM leadership from top management. TQM is a way of life for a company. It has to be introduced and led by top management. This is a key point. Attempts to implement TQM often fail because top management doesn't lead and get committed - instead it delegates and pays lip service. 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. These systems and methods guide all quality activities and encourage participation by all employees. The development and use of performance indicators is linked, directly or indirectly, to customer requirements and satisfaction, and to management and employee remuneration.
Continuous improvement. Continuous improvement of all operations and activities is at the heart of TQM. Once it is recognized that customer satisfaction can only be obtained by providing a high-quality product, continuous improvement of the quality of the product is seen as the only way to maintain a high level of customer satisfaction. As well as recognizing the link between product quality and customer satisfaction, TQM also recognizes that product quality is the result of process quality. As a result, there is a focus on continuous improvement of the company's processes. This will lead to an improvement in process quality. In turn this will lead to an improvement in product quality, and to an increase in customer satisfaction. Improvement cycles are encouraged for all the company's activities such as product development, use of EDM/PDM, and the way customer relationships are
managed. This implies that all activities include measurement and monitoring of cycle time and responsiveness as a basis for seeking opportunities for improvement. Elimination of waste is a major component of the continuous improvement approach. There is also a strong emphasis on prevention rather than detection, and an emphasis on quality at the design stage. The customerdriven approach helps to prevent errors and achieve defect-free production. When problems do occur within the product development process, they are generally discovered and resolved before they can get to the next internal customer. 1.6 Fast response. To achieve customer satisfaction, the company has to respond rapidly to customer needs. This implies short product and service introduction cycles. These can be achieved with customer-driven and process-oriented product development because the resulting simplicity and efficiency greatly reduce the time involved. Simplicity is gained through concurrent product and process development. Efficiencies are realized from the elimination of non-value-adding effort such as re-design. The result is a dramatic improvement in the elapsed time from product concept to first shipment. 1.7 Actions based on facts. The statistical analysis of engineering and manufacturing facts is an important part of TQM. Facts and analysis provide the basis for planning, review and performance tracking, improvement of operations, and comparison of performance with competitors. The TQM approach is based on the use of objective data, and provides a rational rather
than an emotional basis for decision making. The statistical approach to process management in both engineering and manufacturing recognizes that most problems are system-related, and are not caused by particular employees. In practice, data is collected and put in the hands of the people who are in the best position to analyze it and then take the appropriate action to reduce costs and prevent non-conformance. Usually these people are not managers but workers in the process. If the right information is not available, then the analysis, whether it be of shop floor data, or engineering test results, can't take place, errors can't be identified, and so errors can't be corrected. 1.8 Employee participation. A successful TQM environment requires a committed and well-trained work force that participates fully in quality improvement activities. Such participation is reinforced by reward and recognition systems which emphasize the achievement of quality objectives. On-going education and training of all employees supports the drive for quality. Employees are encouraged to take more responsibility, communicate more effectively, act creatively, and innovate. As people behave the way they are measured and remunerated, TQM links remuneration to customer satisfaction metrics. 1.10 A TQM culture. It's not easy to introduce TQM. An open, cooperative culture has to be created by management. Employees have to be made to feel that they are responsible for customer satisfaction. They are not going to feel this if they are excluded from the development of visions, strategies, and plans. It's important they participate in these activities. They are unlikely to behave in
a responsible way if they see management behaving irresponsibly - saying one thing and doing the opposite. 1.11 Product development in a TQM environment. Product development in a TQM environment is very different to product development in a non-TQM environment. Without a TQM approach, product development is usually carried on in a conflictual atmosphere where each department acts independently. Short-term results drive behavior so scrap, changes, workarounds, waste, and rework are normal practice. Management focuses on supervising individuals, and fire-fighting is necessary and rewarded. Product development in a TQM environment is customer-driven and focused on quality. Teams are process-oriented, and interact with their internal customers to deliver the required results. Management's focus is on controlling the overall process, and rewarding teamwork.
UNIT 2 LITERATURE REVIEW The latest changes coming up for the ISO 9001:2000 standard’s "Process Model" seem to complete the embodiment. TQM is the concept that quality can be managed and that it is a process. The following information is provided to give an understanding of the key elements of this process. Total Quality Management (TQM) Total = Quality involves everyone and all activities in the company.
Quality = Conformance to Requirements (Meeting Customer Requirements). Management = Quality can and must be managed. TQM = A process for managing quality; it must be a continuous way of life; a philosophy of perpetual improvement in everything we do.
At its core, Total Quality Management (TQM) is a management approach to long-term success through customer satisfaction. In a TQM effort, all members of an organization participate in improving processes, products, services and the culture in which they work. The methods for implementing this approach come from the teachings of such quality leaders as Philip B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Kaoru Ishikawa and Joseph M. Juran. A core concept in implementing TQM is Deming’s 14 points, a set of management practices to help companies increase their quality and productivity: 1. Create constancy of purpose for improving products and services. 2. Adopt the new philosophy. 3. Cease dependence on inspection to achieve quality. 4. End the practice of awarding business on price alone; instead, minimize total cost by working with a single supplier. 5. Improve constantly and forever every process for planning, production and service.
6. Institute training on the job. 7. Adopt and institute leadership. 8. Drive out fear. 9. Break down barriers between staff areas. 10. Eliminate slogans, exhortations and targets for the workforce. 11. Eliminate numerical quotas for the workforce and numerical goals for management. 12. Remove barriers that rob people of pride of workmanship, and eliminate the annual rating or merit system. 13. Institute a vigorous program of education and self-improvement for everyone. 14. Put everybody in the company to work accomplishing the transformation. The term “Total Quality Management” has lost favor in the United States in recent years: “Quality management” is commonly substituted. “Total Quality
Management,” however, is still used extensively in Europe.
TQM COMPARED TO ISO 9001 ISO 9000 is a Quality System Management Standard. TQM is a philosophy of perpetual improvement. The ISO Quality Standard sets in place a system to deploy policy and verifiable objectives. An ISO implementation is a basis for a Total Quality Management implementation. Where there is an ISO system, about 75 percent of the steps are in place for TQM. The
requirements for TQM can be considered ISO plus. Another aspect relating to the ISO Standard is that the proposed changes for the next revision (1999)
will contain customer satisfaction and measurement requirements. In short, implementing TQM is being proactive concerning quality rather than reactive. 2.2 TQM AS A FOUNDATION
TQM is the foundation for activities which include;
• • • • • •
Meeting Customer Requirements Reducing Development Cycle Times Just In Time/Demand Flow Manufacturing Improvement Teams Reducing Product and Service Costs Improving Administrative Systems Training
TEN STEPS TO TOTAL QUALITY MANAGEMENT (TQM)
The Ten Steps to TQM are as follows: 1. Pursue New Strategic Thinking 2. Know your Customers 3. Set True Customer Requirements 4. Concentrate on Prevention, Not Correction 5. Reduce Chronic Waste 6. Pursue a Continuous Improvement Strategy 7. Use Structured Methodology for Process Improvement 8. Reduce Variation 9. Use a Balanced Approach
10. Apply to All Functions
Processes must be managed and improved! This involves:
• • • • • • • •
Defining the process Measuring process performance (metrics) Reviewing process performance Identifying process shortcomings Analyzing process problems Making a process change Measuring the effects of the process change Communicating both ways between supervisor and user
KEY TO QUALITY
The key to improving quality is to improve processes that define, produce and support our products. All people work in processes. People
Get processes "in control" Work with other employees and managers to identify process problems and eliminate them
Managers and/or Supervisors Work on Processes
• • •
Provide training and tool resources Measure and review process performance (metrics) Improve process performance with the help of those who use the process
PLANNING A CHANGE
TQM Process Improvement and Problem Solving Sequence PLAN (PLAN A CHANGE) DEFINE THE PROBLEM 1. Recognize that what you are doing is a "PROCESS" IDENTIFY POSSIBLE CAUSES DO (IMPLEMENT THE CHANGE) CHECK (OBSERVE THE EFFECTS) TEST THE CHANGE 11. Determine what change worked (confirmation). ACTION (EMBED THE FIX INTO THE PROCESS FOR GOOD) TAKE PERMANENT ACTION 12. Ensure the fix is embedded in the process and that the resulting process is used.
EVALUATE MAKE POSSIBLE A CAUSES CHANGE 6. 8. Determine 10. Determine what "BRAINSTORM" the change would help what is causing relationship the problem. between • Your cause and knowledge effect 2. Identify the 7. Determine of the o Scatter commodity what past data process diagrams being shows. • Scatter o processed. o Frequency diagrams Regression - Process distribution • Control Inference o Pareto charts analysis Charts o Control charts - sampling 3. Define some - sampling 9. Determine • Pareto measurable what the analysis characteristics process is of value to the doing now commodity. o Control ****Then make charts the change. 4. Describe the - sampling
• • •
Histograms Control charts - sampling
Continue to Scatter diagrams monitor the process to ensure: A. The problem is fixed for good. and B. The process
"PROCESS" o Process Flow Analysis's o Flow charts o List of steps 5. Identify the "Big" problem o Brainstorming o Checklists o Pareto analysis
is good enough o Control charts - sampling ****To ensure continuous improvement, return to step 5.
BASIC PRINCIPLES OF TOTAL QUALITY MANAGEMENT (TQM)
by Ron Kurtus (28 May 2001) The basic principles for the Total Quality Management (TQM) philosophy of doing business are to satisfy the customer, satisfy the supplier, and continuously improve the business processes. Questions you may have include:
• • •
How do you satisfy the customer? Why should you satisfy the supplier? What is continuous improvement?
Satisfy the customer
The first and major TQM principle is to satisfy the customer--the person who pays for the product or service. Customers want to get their money's worth from a product or service they purchase. Users If the user of the product is different than the purchaser, then both the user and customer must be satisfied, although the person who pays gets priority. Company philosophy A company that seeks to satisfy the customer by providing them value for what they buy and the quality they expect will get more repeat business, referral business, and reduced complaints and service expenses. Some top companies not only provide quality products, but they also give extra service to make their customers feel important and valued. Internal customers Within a company, a worker provides a product or service to his or her supervisors. If the person has any influence on the wages the worker receives, that person can be thought of as an internal customer. A worker should have the mind-set of satisfying internal customers in order to keep his or her job and to get a raise or promotion.
Chain of customers
Often in a company, there is a chain of customers, -each improving a product and passing it along until it is finally sold to the external customer. Each worker must not only seek to satisfy the immediate internal customer, but he or she must look up the chain to try to satisfy the ultimate customer. Satisfy the supplier A second TQM principle is to satisfy the supplier, which is the person or organization from whom you are purchasing goods or services. External suppliers A company must look to satisfy their external suppliers by providing them with clear instructions and requirements and then paying them fairly and on time. It is only in the company's best interest that its suppliers provide it with quality goods or services, if the company hopes to provide quality goods or services to its external customers. Internal suppliers A supervisor must try to keep his or her workers happy and productive by providing good task instructions, the tools they need to do their job and good working conditions. The supervisor must also reward the workers with praise and good pay.
Get better work
The reason to do this is to get more productivity out of the workers, as well as to keep the good workers. An effective supervisor with a good team of workers will certainly satisfy his or her internal customers. Empower workers One area of satisfying the internal suppler is by empowering the workers. This means to allow them to make decisions on things that they can control. This not only takes the burden off the supervisor, but it also motivates these internal suppliers to do better work. Continuous improvement The third principle of TQM is continuous improvement. You can never be satisfied with the method used, because there always can be improvements. Certainly, the competition is improving, so it is very necessary to strive to keep ahead of the game. Working smarter, not harder Some companies have tried to improve by making employees work harder. This may be counter-productive, especially if the process itself is flawed. For example, trying to increase worker output on a defective machine may result in more defective parts. Examining the source of problems and delays and then improving them is what is needed. Often the process has bottlenecks that are the real cause of the problem. These must be removed. Worker suggestions
Workers are often a source of continuous improvements. They can provide suggestions on how to improve a process and eliminate waste or unnecessary work. Quality methods There are also many quality methods, such as just-in-time production, variability reduction, and poka-yoke that can improve processes and reduce waste.
The principles of Total Quality Management are to seek to satisfy the external customer with quality goods and services, as well as your company internal customers; to satisfy your external and internal suppliers; and to continuously improve processes by working smarter and using special quality methods.
Objectives (MBO), TQM manages by both objectives and the way in which we achieve them. It is as important to follow the standards as it is to achieve the results. Why? Let's say a business objective is achieved (such as reduced costs) because of outside uncontrollable influences such as the price of oil going down. Competitors will receive the same benefit and so there will be no net market gain. If both process and results are pursued, than the company might actually realize a better cost reduction that the competition. Conversely, if the cost of oil goes up, all competitors will be effected, but the TQM company will have offsetting gains from following the business process as well. In conclusion, every organization must be willing to adopt the Principles that:1. Quality can and must be managed. 2. Everyone has a customer and is a supplier. 3. Processes, not people are the problem. 4. Every employee is responsible for quality. 5. Problems must be prevented, not just fixed. 6. Quality must be measured. 7. Quality improvements must be continuous. 8. The quality standard is defect free. 9. Goals are based on requirements, not negotiated. 10. Life cycle costs, not front end costs. 11. Management must be involved and lead.
12. Plan and organize for quality improvement.
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