PAMANTASAN NG LUNGSOD NG MAYNILA

College of Engineering and Technology

Graduate School of Engineering

Assignment No. 1 on

GEM 870-1: TOTAL QUALITY MANAGEMENT

Submitted by:

GLENN A. HERNANDEZ
202061083
MEM-CM

Submitted to:

DR. MANUEL L. OCAMPO

Professor

Date: July 23, 2021

TOTAL QUALITY MANAGEMENT
Assignment No. 1

I. Quality means meeting or exceeding the set standard specification requirements with
minimal or zero errors and defects. I am currently working as an Assistant Materials
Engineer at Department of Public Works and Highways and quality of work is very
important in my line of work. My duty or responsibility is to make sure that the
quality of materials to be use for DPWH projects or the project itself meet the
specified standard requirement. The end user of our projects is the public, that is
why we have to make sure that it is safe and environment-friendly.

II. I believe that we at the Department of Public Works and Highways are practicing
Quality Management. Although we acknowledge that there is always room for
improvement and development. We continuously improve the quality of our service
though feedbacks. And our goal is to minimize or if possible is to eliminate errors so
that our resources are not wasted by fixing mistakes.

III. The ISO 9000:2015 and ISO 9001:2015 standard is based on the following Seven
Principles of Quality Management.

1 – Customer Focus
The primary focus of quality management is to meet customer requirements
and to strive to exceed customer expectations. Sustained success is achieved when
an organization attracts and retains the confidence of customers and other interested
parties on whom it depends. Every aspect of customer interaction provides an
opportunity to create more value for the customer. Understanding the current and
future needs of customers and other interested parties contributes to the sustained
success of an organization

Key Benefits (As per ISO 9000:2015)

 There is an increase in customer value and customer satisfaction;
 There is an improvement in customer loyalty;
 It enhances in repeat business;
 It enhances in reputation of the organization;
 There is an expansion of the customer base;
 There is an increase in revenue and market share.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take to increase Customer
Focus can include:
 To identify and recognize the direct and indirect customers of the
organization who receive value from the organization.
 To understand customers’ current and future needs and expectations;
 The organization must link its objectives to customer needs and expectations;

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  It must communicate customer needs and expectations throughout the
organization;
 It must plan, design, develop, produce, deliver and support products and
services to meet customer needs and expectations;
 It must measure and monitor customer satisfaction and take appropriate
actions;
 It must determine and take action on relevant interested parties’ needs and
appropriate expectations that can affect customer satisfaction;
 It must actively manage relationships with customers to achieve sustained
success.

2 – Leadership
Leaders at all levels establish unity of purpose and direction and create
conditions in which people are engaged in achieving the quality objectives of the
organization. The creation of unity of purpose, direction, and engagement enables
an organization to align its strategies, policies, processes, and resources to achieve
its objectives.

Key Benefits (As per ISO 9000:2015)

 It increases the effectiveness and efficiency in meeting the organization’s
quality objectives;
 There is better coordination of the organization’s processes;
 There is an improvement in communication between levels and functions of
the organization;
 It develops and improves the capability of the organization and its people to
deliver the desired results.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take includes:
 It can communicate the organization’s mission, vision, strategy, policies, and
processes throughout the organization;
 It can create and sustain shared values, fairness and ethical models for
behavior at all levels of the organization;
 It can establish a culture of trust and integrity;
 It can encourage an organization-wide commitment to quality;
 It can ensure that leaders at all levels are positive examples to people in the
organization;
 It can provide people with the required resources, training and authority to
act with accountability;
 It can inspire, encourage and recognize the contribution of people.

3 – Engagement of People
It is essential for the organization that all people are competent, empowered
and engaged in delivering value. Competent, empowered and engaged people
throughout the organization enhance its capability to create value. To manage an

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organization effectively and efficiently, it is important to involve all people at all
levels and to respect them as individuals. Recognition, empowerment, and
enhancement of skills and knowledge facilitate the engagement of people in
achieving the objectives of the organization.

Key Benefits (As per ISO 9000:2015)

 It improves understanding of the organization’s quality objectives by people
in the organization and increased motivation to achieve them;
 It enhances the involvement of people in improvement activities;
 It enhances personal development, initiatives, and creativity;
 It enhances people satisfaction;
 It enhances trust and collaboration throughout the organization;
 It increases attention to shared values and culture throughout the
organization.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take includes:
 It can communicate with people to promote understanding of the importance
of their individual contribution;
 It can promote collaboration throughout the organization;
 It can facilitate open discussion and sharing of knowledge and experience;
 It can empower people to determine constraints to performance and to take
initiatives without fear;
 It can recognize and acknowledge people’s contribution, learning, and
improvement;
 It can enable self-evaluation of performance against personal objectives;
 It can conduct surveys to assess people’s satisfaction, communicate the
results and take appropriate actions.

4 – Process Approach
Consistent and predictable results are achieved more effectively and
efficiently when activities are understood and managed as interrelated processes that
function as a coherent system. The quality management system is composed of
interrelated processes. Understanding how results are produced by this system,
including all its processes, resources, controls and interactions, allows the
organization to optimize its performance.

Key Benefits (As per ISO 9000:2015)

 It enhances the ability to focus effort on key processes and opportunities for
improvement;
 There are consistent and predictable outcomes through a system of aligned
processes;
 It can optimize performance through effective process management, efficient
use of resources and reduced cross-functional barriers;

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  It enables the organization to provide confidence to interested parties related
to its consistency, effectiveness, and efficiency.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take includes:
 It can define the objectives of the system and processes necessary to achieve
them;
 It can establish authority, responsibility, and accountability for managing
processes;
 It can understand the organization’s capabilities and determine resource
constraints prior to action;
 It can determine process interdependencies and analyze the effect of
modifications to individual processes on the system as a whole;
 It should manage processes and their interrelations as a system to achieve
the organization’s quality objectives effectively and efficiently;
 It can ensure the necessary information is available to operate and improve
the processes and to monitor, analyze and evaluate the performance of the
overall system;
 It should manage risks which can affect outputs of the processes and overall
outcomes of the QMS.

5 – Improvement
Successful organizations have an ongoing focus on improvement.
Improvement is essential for an organization to maintain current levels of
performance, to react to changes in its internal and external conditions and to create
new opportunities.

Key Benefits (As per ISO 9000:2015)

 There are improved process performance, organizational capability, and
customer satisfaction;
 There is an enhanced focus on root cause investigation and determination,
followed by prevention and corrective actions;
 There is an enhanced ability to anticipate and react to internal and external
risks and opportunities;
 There is enhanced consideration of both incremental and breakthrough
improvement;
 There is improved use of learning for improvement; There is an enhanced
drive for innovation.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take includes:
 It can promote the establishment of improvement objectives at all levels of
the organization;
 It can educate and train people at all levels on how to apply basic tools and
methodologies to achieve improvement objectives;

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  It can ensure people are competent to successfully promote and complete
improvement projects;
 It can develop and deploy processes to implement improvement projects
throughout the organization;
 It can track, review and audit the planning, implementation, completion, and
results of improvement projects;
 It can integrate improvement consideration into the development of new or
modified products and services and processes;
 It can recognize and acknowledge improvement.

6 – Evidence-based Decision Making

Decisions based on the analysis and evaluation of data and information are
more likely to produce desired results. Decision-making can be a complex process,
and it always involves some uncertainty. It often involves multiple types and sources
of inputs, as well as their interpretation, which can be subjective. It is important to
understand cause-and-effect relationships and potential unintended consequences.
Facts, evidence, and data analysis lead to greater objectivity and confidence in
decisions made.

Key Benefits (As per ISO 9000:2015)

 There is an improvement in decision-making processes;
 There is an improvement in the assessment of process performance and
ability to achieve objectives;
 There is an improvement in operational effectiveness and efficiency;
 There is an increased ability to review, challenge and change opinions and
decisions;
 There is an increased ability to demonstrate the effectiveness of past
decisions.

Possible actions (As per ISO 9000:2015)

Some of the possible actions that an organization can take includes:
 It should determine, measure and monitor key indicators to demonstrate the
organization’s performance;
 It can make all data needed available to the relevant people;
 It should ensure that data and information are sufficiently accurate, reliable
and secure;
 It can analyze and evaluate data and information using suitable methods;
 It should ensure people are competent to analyze and evaluate data as
needed;
 It can make decisions and take actions based on evidence, balanced with
experience and intuition.

7 – Relationship Management
For sustained success, organizations manage their relationships with
interested parties, such as suppliers. Interested parties influence the performance of

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 an organization. Sustained success is more likely to be achieved when an
organization manages relationships with its interested parties to optimize their
impact on its performance. Relationship management with its supplier and partner
network is often of particular importance

Key Benefits (As per ISO 9000:2015)

 There is enhanced performance of the organization and its relevant interested
parties through responding to the opportunities and constraints related to
each interested party;
 There is a common understanding of objectives and values among interested
parties;
 There is an increased capability to create value for interested parties by
sharing resources and competence and managing quality-related risks;
 There is a well-managed supply chain that provides a stable flow of products
and services.

Possible actions (As per ISO 9000:2015

Some of the possible actions that an organization can take includes:
 It can determine relevant interested parties (such as providers, partners,
customers, investors, employees or society as a whole) and their relationship
with the organization;
 It can determine and prioritize interested party relationships that need to be
managed;
 It can establish relationships that balance short-term gains with long-term
considerations;
 It can gather and share information, expertise, and resources with relevant
interested parties;
 It can measure performance and provide performance feedback to interested
parties, as appropriate, to enhance improvement initiatives; It can establish
collaborative development and improvement activities with providers,
partners, and other interested parties;
 It can encourage and recognize improvements and achievements by
providers and partners.

IV. Of all the quality gurus, Mr. Philip Crosby is the one I admire the most. His response
to the quality crisis was the principle of “doing it right the first time” (DIRFT) and he
is widely known for promoting the concept of “zero defects” and for defining quality
as conformance to the requirements. Going back to my answer from question No. 1,
I believe we share the same principle with regards to quality that is why I admire
him.

V. The following are the cost of quality of a certain manufacturer of construction

materials:

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 a. Appraisal Cost – Php 91,000.00
1. Design Review – Php 18,000.00
2. Inspection of units produced – Php 35,000.00
3. Testing of procured goods & services – Php 20,000.00
4. Maintenance of Testing equipments – Php 18,000.00

b. Prevention Cost – Php 155,000.00

1. Quality planning workshop – Php 15,000.00
2. Documentation workshop – Php 12,500.00
3. Documentation workshop – Php 12,500.00
4. Purchase of new production equipment – Php 32,500.00
5. Quality audits – Php 28,000.00
6. Training and Education – Php 23,000.00
7. Quality improvement projects – Php 20,000.00
8. Quality circle cost – Php 12,000.00
c. Internal-Failure Cost – Php 225,000.00
1. Downtime due to defective units – Php 85,000.00
2. Scrapped units – Php 62,000.00
3. Reworking of defective units – Php 78,000.00
d. External-Failure Cost – Php 615,000.00
1. Warranty cost of returned defective products – Php 75,000.00
2. Estimated loss of market share due to delivery of defective products
– Php 250,000.00
3. Delays in delivery of finished goods – Php 55,000.00
4. Replacement of returned defective products – Php 85,000.00
5. Legal fees due to returned defective products – Php 50,000.00
6. Product recall cost – Php 18,000.00
e. Cost of Conformance – Php 246,500.00
= Appraisal Cost + Prevention Cost
= Php 91,000.00 + Php 155,000.00
f. Cost of Non-Conformance – Php 840,000.00
= Internal-Failure Cost + External-Failure Cost
= Php 225,000.00 + Php 615,000.00
g. Cost of Quality – Php 1,086,500.00
= Cost of Conformance + Cost of Non-Conformance
= Php 246,500.00 + Php 840,000.00

a. Appraisal Cost ₱ 91,000.00

b. Prevention Cost ₱ 155,500.00
c. Internal-Failure Cost ₱ 225,000.00
d. External-Failure Cost ₱ 615,000.00
e. Cost of Conformance ₱ 246,500.00
f. Cost of Non-Conformance ₱ 840,000.00
g. Cost of Quality ₱ 1,086,500.00

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