Lec # 3, 4, 5 (Total Quality Management) (Compatibility Mode)

2/19/2014
Quality Control
Chapter 2- Total Quality
Management and Principles
PowerPoint presentation to accompany
Besterfield
Quality Control, 8e
PowerPoints created by Rosida Coowar
Besterfield: Quality Control, 8th ed.. © 2009 Pearson Education, Upper Saddle River, NJ 07458.
All rights reserved
Outline
Introduction
Basic Approach
Leadership
Customer Satisfaction
Employee Involvement
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Outline-Continued
Continuous Process Improvement
Supplier Partnership
Performance Measures
Deming’s 14 Points
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Learning Objectives
When you complete this chapter, you should:
Know the six basic concepts, the purpose and
benefits of TQM.
Understand the twelve characteristics of a
leader.
Describe the necessary management activities to
implement a TQM program.
Know the importance of customer satisfaction
and how to achieve it.
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Learning Objectives-cont’d.
When you complete this chapter, you should:
Describe the process necessary for effective
employee involvement.
Describe continuous process improvement and
the problem-solving method.
Know the importance of supplier partnership and
techniques to measure effectiveness.
Be able to describe the measures of
performance.
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Introduction
Total Quality Management (TQM) is the
application of quantitative methods and
human resources to improve all the
processes within an organization and
exceed customer needs now and in the
future.
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TQM
The purpose of TQM is to provide a quality
product to customers, which will, in turn,
increase the productivity and lower cost
TQM allows the organization to achieve the
business objectives of profit and growth
Job Security. TQM creates a satisfying place
to work
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TQM
A company will not begin the transformation
to TQM until it is aware that the quality of the
product or service must be improved
TQM requires a cultural change
TQM is mandated by the customer
TQM is better way to run a business and
compete in domestic and word markets
Quality is first among equal cost and service
Improvements in quality lead directly to
increased productivity
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TQM
Basic Approach:
1. A committed and involved management to
provide long-term top-to-bottom
organizational support
2. An unwavering focus on the customer
3. Effective involvement and utilization of the
entire work force
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TQM
Basic Approach cont’d:
4. Continuous improvement of the business
and production processes
5. Treating suppliers as partners
6. Establishing performance measures for
the processes
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TQM
The Road to Business Growth
Business Growth
Continuous Improvement
Supplier Partnering
Focus on Quality
Process Orientation
Leadership
th
Besterfield: Quality Control, 8 ed..
Clear Vision 11
© 2009 Pearson Education, Upper Saddle River, NJ 07458.
All rights reserved
TQM
Quality Element Previous State TQM
Definition Product-Oriented Customer-oriented
Priorities Second to service First among
and cost service and cost
Decisions Short-term Long-term
Emphasis Detection Prevention
Errors Operations System
Responsibility Quality Control Everyone
Prob. Solving Managers Teams
Procurement Price Life-cycle costs
Manager’s Role Plan, enforce etc Delegate, facilitate
Table2.1 New and Old Cultures

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TQM
Quality involves the design of the product
and the process
TQM is not something that will occur
overnight, it takes a long time to build the
appropriate emphasis and techniques into the
culture
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Leadership
The ability to positively influence people and
systems to have a meaningful impact and
achieve results
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Leadership
Recognize that the quality function is no more
responsible for product quality….Quality is the
responsibility of everyone in the organization
Commitment to quality becomes part of the
corporation’s business strategy and leads to
enhanced profit and an improved competitive
position
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Leadership
Leadership System:
Refers to how decisions are made,
communicated, and carried out at all levels;
mechanisms for leadership development, self-
examination, and improvement
Effectiveness of leadership system depends in
part on its organizational structure
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Leadership
Leadership Characteristics:
1. Give priority attention to external and internal
customers and their needs
2. Empower, rather than control, subordinates
3. Emphasize improvement rather than maintenance
4. Emphasize prevention
5. Encourage collaboration rather than competition
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Leadership
Leadership Characteristics Cont’d:
6. Train and coach, rather than direct and supervise
7. Learn from problem
8. Improve communications
9. Demonstrate their commitment to quality
10.Choose suppliers on the basis of quality, not price
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Leadership
Leadership Characteristics Cont’d:
11. Establish organizational systems to support the
quality effort
12. Encourage and recognize team effort
Leadership is essential during every phase of the

implementation process and particular at the
start!!!!!
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TQM Implementation
Begins with the Senior Management’s and the CEO’s
commitment
Involvement is required
Requires the education of Senior Management in TQM
concepts
Timing of the implementation process can be very
important
Formation of the Quality Council
Development of Core Values, Vision Statement, Mission
Statement, Quality Policy Statement
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TQM Implementation
Quality Council:
Composed of: CEO, the Senior Managers of
the functional areas, such as design,
marketing, finance, production, and quality;
and a coordinator or consultant
The coordinator will ensure that the team
members are empowered and know their
responsibilities
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TQM Implementation
Quality Council Duties:
1. Develop the core values, vision, mission, and
quality policy statements
2. Develop the strategic long-term plan with
goals and the annual quality improvement
program with objectives
3. Create the total education and training plan
4. Determine and continually monitor the cost
of poor quality
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TQM Implementation
Quality Council Duties:
5. Determine the performance measures for the
organization
6. Determine projects that improve the processes
7. Establish multifunctional project and
departmental or work group team
8. Establish or revise the recognition and reward
system
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TQM Implementation
Core Values for the Malcolm Baldrige
National Quality Award:
Visionary Leadership
Customer-driven Excellence
Organizational & Personal Learning
Valuing Employees & Partners
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TQM Implementation
National Quality Award Cont’d:
Agility
Focus on the Future
Management for Innovation
Management by Fact
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TQM Implementation
National Quality Award Cont’d:
Social Responsibility
Focus on Results and Creating Value
Systems Perspective
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TQM Implementation
Quality Statements:
Include the Vision Statement, Mission
Statement, and Quality Policy Statement
They are part of the strategy planning
process, which includes goals and objectives
Develop with input from all personnel
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TQM Implementation
Seven Steps to Strategy Planning:
Customer Needs
Customer Positioning
Predict the Future
Gap Analysis
Closing the Gap
Alignment
Implementation
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Who is the Customer?
External Customer -- those who receive the final products.
Occurs normally at the organizational level
Internal Customers -- occur at the process and cross-
departmental levels within the company
Identifying Customers:
What parts or products are produced?
Who uses our parts or products?
Who do we call, correspond/interact with?
Who supplied the inputs to the process?
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Customer Satisfaction – Cont’d.

Checklist to improve satisfaction:
1. Who are my customers?
2. What do they need?
3. What are their measures and expectations?
4. How is my product or service?
5. Does my product or service exceed expectations?
6. How do I satisfy those needs?
7. What corrective action is necessary?
8. Are customers included on teams?
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Customer Feedback:
1. Comment cards and formal surveys
2. Focus groups
3. Direct customer contacts
4. Field Intelligence
5. Study complaints
6. Monitoring the Internet
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Customer Complaints:
Dissatisfied customers rarely complain
Opportunity for quality improvement
Procedure for customer complaints, such as:
Accept complaints
Feedback complaint information to all people
Analyze complaints by doing effective work
Eliminate the root cause
Report results of all investigations and solutions to
everyone involved
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Basic Elements of Service Quality:
Organization
Customer
Communication
Front-Line People
Leadership
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……. any activity by which employees participate
in work-related decisions and improvement
activities, with the objectives of tapping the
creative energies of all employees and improving
their motivation
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Employee Involvement – Cont’d.

Education and Training:
The cost of education and training for all
personnel is enormous and the time to achieve
it is lengthy
Educational needs vary by function area,
department and job
Quality Council may want to establish a project
team for the planning of the program
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The Goal is to achieve perfection:
View work as a process
Make all processes effective, efficient, and
adaptable
Anticipate changing customer needs
Control in-process performance using measures
such as scrap reduction…
Maintain constructive dissatisfaction with the
present level of performance
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The Goal is to achieve perfection:
Eliminate waste and rework
Investigate non-value added activities
Eliminate nonconformities
Use benchmarking to stay competitive
Hold gains
Lessons learned
Use tools such as SPC, design of experiments etc.
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FEEDBACK
PROCESS OUTPUT
INPUT People Information
Materials Equipment Data OUTCOMES
Money Method
Procedures
Product
Information Environment Service, etc.
Data, etc Materials
CONDITIONS
Figure 2-3 Input/output process model
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Problem-Solving Method:
1. Identify the opportunity
2. Analyze the current process
3. Develop the optimal solution(s)
4. Implement changes
5. Study the results
6. Standardize the solution
7. Plan for the future
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Problem-Solving Method – Phase I:
Identify the opportunity
Identify and prioritize opportunities for
improvement
1. Is the problem important and not superficial
and why?
2. Will the problem solution contribute to the
attainment of goals?
3. Can be problem be defined clearly using
numbers? 40
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Form a team
Select the team leader and determine goals
and deadlines
Define the Scope
Develop a good problem statement that states
the facts, focuses on what is known and
emphasizes the impact on the customer.
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Develop a comprehensive charter that
specifies
Authority
Objective and scope
Composition
Direction and control
General
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Problem-Solving Method – Phase II:
Analyze the current process
Develop a process flow
Define the target performance measures
Collect all available data and information
Determine the root cause
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Problem-Solving Method – Phase III:
Develop the optimal solution
Determine possible solutions
Judge possible solutions for greatest
potential for success
Categorize solutions as short range
or long range
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Problem-Solving Method – Phase IV:
Implement Changes
Prepare the implementation plan
Obtain approval for the plan
Develop implementation plan report
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Problem-Solving Method – Phase V:
Study the results
Take measurements
Evaluate results
Identify unforeseen problems as a result of
the changes
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Problem-Solving Method – Phase VI:
Standardize the Solution
Institutionalize the change
Certify the quality peripherals
Certify operators
Cross-training
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Problem-Solving Method – Phase VII:
Plan for the Future
Conduct regular scheduled reviews
Establish systems to identify areas for future
improvement
Incorporate process measurement and team
problem solving in all work activities
Reduce complexity, variation and out-of-
control processes
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On average 40% or more of product or service
cost is due to procurement. The supplier should
be treated as an extension of the process.
This requires:
Long term relationship with supplier(s)
Good supplier management
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Supplier Selection Criteria:
Quality of parts/raw materials Certified?
On-time delivery
100% delivery
Technology
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Performance Measurements
Service
Billing Errors
Sales per square feet
Activity time
Production
Yield
Inventory turns
On-time delivery
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Cost of Poor Quality:
Prevention Costs:
Costs of minimizing failure and appraisal
costs
Appraisal Costs:
Costs of determining the degree of
conformance to quality requirements
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Cost of Poor Quality:
Internal Failure Costs:
Costs resulting from defects found before the
customer receives the product or service
External Failure Costs:
Costs resulting from defects found after the
customer receives the product or service
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Optimum Cost of Poor Quality
Total Quality Costs = Internal and External
Failure Costs + Prevention and Appraisal Costs
Poor quality usually is a result of low investment
in prevention and appraisal
This results in an increase in the failure costs
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Optimum Cost of Poor Quality
As more money/effort is invested in
prevention and appraisal, the quality
improves which in turn drives the failure
costs down.
The total costs of poor quality is at its lowest
when the failure costs are non existent.
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Malcolm Baldrige National Quality Award
The Baldrige Award is given by the President of
the United States to businesses —
manufacturing and service, small and large —
and to education and health care organizations
that apply and are judged to be outstanding in
seven areas
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Core Values/Concepts
Visionary leadership
Customer-driven excellence
Org. and personal learning
Valuing employees and partners
Agility
Focus on the future
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Core Values/Concepts
Managing for innovation
Management by fact
Social Responsibility
Focus on results and creating value
Systems perspective
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Taguchi’s Loss Function

High loss L = D2C
Unacceptable where
Loss (to
producing L = loss to society
organization,
Poor D = distance from
customer, Good target value
and society) C = cost of deviation
Best
Low loss Target-oriented quality
yields more product in
the “best” category
Target-oriented quality
brings product toward
the target value
Frequency
Conformance-oriented
quality keeps products
within 3 standard
deviations
Lower Target Upper
Specification
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1. Create consistency of purpose
2. Lead to promote change
3. Build quality into the product; stop
depending on inspection
4. Build long term relationships based on
performance, not price
5. Continuously improve product, quality, and
service
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6. Start training
7. Emphasize leadership
8. Drive out fear
9. Break down barriers between departments
10. Stop haranguing workers
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11. Support, help, improve
12. Remove barriers to pride in work
13. Institute a vigorous program of education
and self-improvement
14. Put everybody in the company to work on
the transformation
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Lec # 3, 4, 5 (Total Quality Management) (Compatibility Mode)

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2/19/2014

PowerPoints created by Rosida Coowar

Table2.1 New and Old Cultures

Leadership is essential during every phase of the

Customer Satisfaction – Cont’d.

Customer Satisfaction – Cont’d.

Customer Satisfaction – Cont’d.

Customer Satisfaction – Cont’d.

Employee Involvement – Cont’d.

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Figure 2-3 Input/output process model

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Continuous Process Improvement

Taguchi’s Loss Function

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