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NAME: Carlos Manuel S.

Abalos DATE: August 14, 2017


SUBJECT: BEC102 – Total Quality Management SECTION: III-BSBA-H

CHAPTER 1 TQM Evolution

Introduction

 Total Quality Management (TQM) is a customer oriented management philosophy and strategy.
It is centered on quality so as to result in customer delight. The word “total” implies that all
members of the organization make consistent efforts to achieve the objective of customer delight
through systematic efforts for improvement of the organization
 The TQM Philosophy was evolved in Japan after World War II. Deming Edwards, an American
quality expert helped the Japanese to apply the concept of TQM. They concentrated on customer
satisfaction and focused on understanding customer needs and expectations.
 The TQM philosophy was adapted by the Americans in the 1980s to look for new ways to survive
in an environment of deregulation, a growing trade deficit, low productivity , recession,
downsizing, and increasing consumer awakening.
 In 1985, the American Navy coined the term TQM to represent broadly the Japanese way of
quality management
 Quality gurus – experts who spearheaded the evolution of methodologies for assuring quality in
products and services.
 TQM – culmination of the teachings of the Quality gurus
 TQM – it addresses the concepts of product quality, process control, quality assurance, and
quality improvement, all of which at aimed at customer delight.

Definition of Quality

 Juran: Defined quality as fitness for use.


 Quality of a product or service in simple terms is its suitability for use by the customer. Quality
has to be perceived by the customer. Perception of the supplier is also important, but the customer
experience of quality of a product or service is more important. Quality does not mean an expensive
product; on the contrary it is fitness for use of the customer.
 International Organization for Standardization (ISO), founded in year 1946 is the world body for
standards formulation and its headquarters is in Geneva Switzerland. It is known all over the world
for its path breaking ISO 9000, released for the first time in the year 1987.
 ISO: The totality of features and characteristics of a product or service that bear on its ability to
satisfy a given or implied need
 Standard definition: it is essentially satisfying the customer needs, both stated and unstated
.(implied)

Chain Reaction
 Quality improvement results in improved productivity. By eliminating defects, non-value adding
activities, and rework, additional resource capacity is created. Improved quality also reduces the
production cycle time and machine time.
 The Japanese success is the best case study for TQM. Understanding the chain reaction
transformed them from a shattered economy to a successful nation challenging the USA after World
War II.

Improve Quality

Costs decrease due to fewer


defects, lesser rework, fewer delays
and better use of men, machine, and
materials

Improved Productivity

Capture market with better quality


and lower prices

Stay in business

Provide more jobs

Dimensions of Quality

 Dimensions of quality differ for products and services. There are also dimensions which can be applicable
for both products and services

Product quality dimensions

Dimension Definition
It refers to the core features and characteristics of a product.

Functionality The definition as per ISO/IEC9126:1991: “A set of attributes that bear


on the existence of a set of functions and their specified properties. The
functions are those that satisfy stated or implied needs”
It is measured by mean time between failures. It is an indicator of
Reliability
durability
It can be measured by the time taken for training an operator for error-
Usability
free operation of a system
It refers to the ease with which a product can be maintained in the
original condition. It is measured as mean time to repair (MTTR)
Maintainability
For software, maintainability is defined in the Standard ISO9126:1991
as “ A set of attributes that bear on the effort needed to make specified
modifications”
Efficiency It is the ratio of output to input.
This is a dimension that applies more to software. It is defined as a set
Portability of attributes that bear on the ability of software to be transferred from
one environment to another.

Service quality dimensions

Dimension Definition
This include but not limited to:
 How well the customer is received?
Quality of customer service
 How well the implied requirements are elucidated?
 How well the customer is treated/handled/satisfied?
It is important that the service is designed as per the requirements of
Quality of service design
the specific customer.
Quality of delivery It is important in any sector, but more crucial in case of services.

Attributes of quality which are applicable to both products and services

Dimension Definition
Timeliness Delivery on schedule as per requirements of the customer
a product or service should look attractive. It may include but not
Aesthetics
limited to the appearance of the product, the finish, color, etc.
Regulatory requirements Stipulated by the local and federal governments
The products should fulfill both stated and implied requirements
Requirements of society
imposed by society
Products and services should conform to the stated and implied
Conformance to standards
requirements of customers

Evolution of Quality

Quality guru Contribution


He worked in Western Electric Company and AT&T USA. He
Dr. Walter A. Shewhart
advocated Statistical Quality Control (SQC) and Acceptable Quality
Level (AQL). AQL is the foundation of today’s Six Sigma. He is
considered to be the father figure of SQC, who developed control
charts for quality assessment and improvement. He also developed the
Plan, Do, Check, Act (PDCA) cycle for continuous improvement
which is in use even today. He is the author of the following books:
 Economic Control of Quality of Manufactured Products
 Statistical Method from the Viewpoint of Quality Control
An associate of Shewhart, worked in Western Electric Company as a
statistician. He was invited to Japan to lead the quality movement. He
modified PDCA cycle of Shewhart to the Plan, Do, Study and Act
(PDSA). He also advocated extensive use of statistics and control
charts and focused on product improvement and service conformance
by reducing variations in the process. He joined the US census Bureau
in 1939 and proved that quality control methods could lower costs even
Deming W. Edwards
in an exclusive service organization. During the 1950s, he visited
Japan 18 times, held seminars and worked with the Japanese Union of
Scientists and Engineers (JUSE). He stressed on the importance of
suppliers and customers for the business development and
improvement. His 14 points formed the basis for his advice to Japanese
top management. The 14 points are applicable to every industry in
product and service sector
He also joined Western Electric Company and developed Western
Electric Statistical Quality Control Handbook. JUSE invited him to
Japan in 1954.

Juran’s fitness of quality:


 Quality of design – through market research, product, and concept
 Quality of conformance – through management, manpower, and
technology
 Availability – through reliability, maintainability, and logistic
support
Joseph M. Juran
 Full service – through promptness, competence, and integrity

Juran’s quality planning roadmap


 Identify your customers
 Determine their needs
 Translate them into your language
 Develop a product that can respond to the needs
 Develop processes which are able to produce those product features
 Prove that the process can produce the product
 Transfer the resulting plans to the operating forces
The Vice President of International Telephone & Telegraph (ITT). His
Philip B. Crosby
4 absolutes of quality are very relevant to TQM:
 Quality is conformance to requirements, nothing more or nothing
less and certainly not goodness or elegance.
 Quality has to be achieved by prevention and not by appraisal
 The performance standard must be zero defect and not something
close to it
 The measurement of quality is the price of non-conformance, i.e.
how much the defects in design, manufacture, installation and service
cost the company. It is not indexes, grade one or grade two.
He was the President of American Society of Quality Control (1961-
1963). He said, “Quality is in its essence a way of managing the
organization.” He suggested the following methodology for cycle time
reduction:
 Define process
Armand V. Feigenbaum
 List all activities
 Flowchart the process
 List the elapsed time for each activity
 Identify non-value adding tasks
 Eliminate all possible non-value adding tasks
A quality guru from Japan, he strongly advocated the use of causes and
effect diagrams to provide a true representation of the organizational
Kaoru Ishikawa
impacts and procedures. He developed Fishbone or Ishikawa diagram
for cause and effect analysis.

Other quality gurus include James Harrington, Taguchi, and Shingo.

Basic Terms Related to Quality

Term Definition
It may be defined as: The operational techniques and activities that are
used to fulfill the requirements for quality. Juran gives 3 steps of QC:
 Evaluate actual operating performance
 Compare actual performance to goals
Quality control
 Act on the difference

It is the inspection or appraisal of products and services to ensure that


the stated requirements are fulfilled.
It can be defined as: all the planned and systematic activities
implemented within the quality system, and demonstrated as needed,
to provide adequate confidence that an entity will fulfill the
Quality Assurance requirements for quality. Its purpose is to fulfill the quality
requirements of an entity with adequate confidence by the supplier.

Requirements for building quality into the products:


 Quality of Design – it refers to how well the product or service has
been designed to meet the current and future requirements of
customers and add value to stakeholders. It involves all activities that
will result in a successful design. It necessarily includes finding out the
customers’ requirements. The stakeholders for any organization are:
o Customers
o Employees
o Suppliers
o Owners
o Society
 Quality of Conformance – this indicates the consistency in
delivering the designed product. It involves all activities that will
ensure the conformance of the products to its requirements consistently
 Quality of Performance – it is an indicator of the performance of
the end product. This in turn depends on the quality of design and
quality of conformance
 Quality of Service – it involves all activities that will enable the
customer to procure and use the product without any hassles.
It refers to the activities that establish the objectives and requirements
for quality. It involves planning for the following with regard to a
product or service or project or a contract:
 Quality objectives to be met
Quality Planning  Specific of QA/QC practices
 Resources needed
 Sequence of QA/QC activities

4Ms: Man, Machine, Material, and Methods


This process aims at attaining unprecedented levels of performance
Quality improvement
which are significantly better than the past level.
It involves making plans for the following:
 Business value
 Investment in machinery and equipment
 Manpower to be hired
 Budget
 Product diversification
Strategic planning  Markets to be served
 Strategies for improving profits, etc.

Malcolm Baldrige National Quality Awards (MBNQA) – The


prestigious quality award in the USA calls for integration of quality
planning and improvement planning as a part of strategic planning.
Quality Improvement Planning – It should focus on the needs of the
current and future customers and support the strategic and business
goals of the organization
ISO9000 standards: “Quality management comprises all activities of
the overall management function that determine the quality policy,
objectives, and responsibilities and implement them by means such as
quality planning, quality control, quality assurance and quality
improvement within the quality system

Quality system – consists of the organizational structure, procedures,


processes, and resources needed to implement quality management.

Quality management Effects of having a quality system:


 The company must have an objective and policy for quality of the
products and services
 The organization should plan for meeting the objective
 The plan should include QA, QC, and methodology for improvement
 There must be a clear organizational structure for building quality
into the products and services with necessary resources
 The quality management should be implemented formally with well-
defined processes and procedures and trained resources.
It was Feigenbaum who coined the phrase, “Total Quality Control”.
The concept was known in Japan as Company Wide Quality Control
(CWQC). In 1985, Americans came up with the term Total Quality
Management (TQM) to represent essentially the Japanese way of
Quality Management

Just-In-Time (JIT) – an idea refined by Tai-ichi Ohno of Toyota


Motors. This means that at no stage of manufacturing nobody or
nothing waits for anything. This is to ensure that there is no wastage of
machinery, materials, and manpower. It focuses on right scheduling so
as to keep inventory as low as possible. This requires a perfect
Total Quality Management
partnership between supplier and consumer.

ISO 9000 Standards – it was released for the first time in the year
1987 to bring in system for quality in every organization. The standard
was revised in 1994 and later in the year 2000. The standard in the
latest version advocates TQM and continuous process improvement.

Deming Award for Quality – A quality award instituted by the


Japanese in the name of Deming in the year 1951. The award is now
given not only to companies in Japan, but even overseas who excel in
quality