CONCEPTS & PRINCIPLES OF QUALITY MANAGEMENT

Concept of Quality Management

The concept of ‘quality’ has existed for many years, though the meaning has changed
and evolved over time. In the early twentieth century, quality management meant inspecting
products to ensure that they met specifications. In the 1940s, during World War II, quality
became more statistical in nature.
Statistical sampling techniques were used to evaluate quality, and quality control
charts were used to monitor the production process. In the 1960s, with the help of so-
called ‘quality gurus’, the concept took on a broader meaning.
Quality began to be viewed as something that encompassed the entire organization,
not only the production process. Since all functions were responsible for product quality and
all shared the costs of poor quality and finally quality was considered as a concept that
affected the entire organization.
Today, successful companies understand that quality provides a competitive
advantage. They put the customer first and define quality as meeting or exceeding
customer expectations. Since the 1970s, competition based on quality has grown in
importance and has generated tremendous interest, concern, and enthusiasm.
Companies in every line of business are focusing on improving quality in order to be
more competitive. In many industries quality excellence has become a standard for doing
business. Companies that do not meet this standard simply will not survive.
The term used for today’s new concept of quality is total quality management or
TQM. One can see that the old concept is reactive, designed to correct quality problems after
they occur. The new concept is proactive, designed to build quality into the product and
process.
QUALITY MANAGEMENT
Quality management deals with the management of product or service quality in every
step of the process from planning and initiation to delivery and maintenance. When it comes
to project management, the goal is to achieve the desired level of quality in the project.
Quality does not necessarily mean zero defects which is impractical in real world
problems solving methods, but it does strive maintain consistency and include measures
to reduce undesired behavior of systems across projects. There are four stages of Quality
Management in general:

Quality Planning Quality Assurance Quality Control Quality Improvement

 QUALITY MANAGEMENT & QUALITY MANAGEMENT SYSTEM

Quality Management is simply an act of setting guidelines and implementing

them in the process of manufacturing, developing, testing, and delivering a product or
service, in order to maintain the desired level of standard in the product or service. On the
other hand, Quality management can be seen as act of standardizing every aspect of
product development or service to achieve minimum deviation from the ideal state or form
and behavior of the desired product.
Simply put, quality is an important attribute of all the things we intend to buy and
services we use in our lives. Quality is not just a label or a feature of some sort that you could
add at the end to the product. This is an act of diligence put in every decision that is made
in the aspect of selection, manufacturing and testing the product before it reaches the
consumer.
QUALITY MANAGEMENT SYSTEM
Quality Management System, also referred to as QMS is simply defined as a
formalized system that documents the guidelines, processes, procedures, and
responsibilities for achieving policies and objectives that control, maintain or bring in
quality in the product or service as per the agreed upon standards. The Quality Management
System coordinates and guides, monitors and continually tracks the organizations day
to day activities and tasks in a way to meet customer needs and regulatory
requirements of desired quality standards
IMPORTANCE OF QUALITY MANAGEMENT SYSTEMS
QMS will provide a systematic and sustainable approach with a framework to the
product development or project process improvement to achieve the desired quality as
per the organization’s objectives and customer’s evolving business needs. It will identify
quality issues in the early stage and eliminate redundant activities of no value to overall
quality management of the project and ensure performance improvement is constantly
monitored and tracked to achieve the desired results through all stages until the delivery
of the end-product.
ELEMENTS AND REQUIREMENTS OF QMS

We now know that Quality Management Systems simply helps the organization to meet
its quality promise and quality goals.
The basic elements or requirements of Quality Management System can be listed
as the following:
1. Organization Policy on Quality
The QMS should be aligned to Quality Policy of the Organization. As the QMS is the tool
to achieve quality, Organization policy will work as a framework on what needs to be achieved
by implementing a QMS.
2. Quality Manual
This is a manual of standardized practices to enhance quality.
3. Procedures, Instructions and Data Records
Documenting procedures, instructions and data records in quality manual will help by
being a guideline for subsequence iterations to come.
4. Quality Analysis and Testing
The QA teams often function as a first customer for a product or service. A strong QMS
often warrants a strong QA strategy and team to better manage the quality of the product.
5. Improvement Opportunities
The customer needs are constantly evolving. A fundamentally strong Quality Management
System is also expected to periodically review and improve the overall process in order to stay
relevant to the contemporary customer needs and competition. The QMS is needed to
continually evaluate and evolve by identifying improvement opportunities.

7 QUALITY MANAGEMENT PRINCIPLES:

1. CUSTOMER FOCUS
“There is only one boss. The customer. And he can fire everybody in the company from the chairman on down,
simply by spending his money somewhere else.” - Sam Walton

Sustained success is achieved when an organization attracts and retains the confidence
of customers and other interested parties. Every aspect of customer interaction provides an
opportunity to create more value for the customer. Understanding current and future needs
of customers and other interested parties contributes to sustained success of the
organization.
But the challenge of this principle is to satisfy the customer, to build loyalty. This is even
more important as nowadays, with social networks and the internet in general, the customer
can express his dissatisfaction / his delight and be heard by all, immediately. This can either
destroy an organization's image or, on the contrary, give it an excellent reputation.
To strengthen its customer focus, the organization must work on its customers’
expectations: identify them (and even anticipate them) and do everything possible to ensure
that the products or services offered meet them.
Key benefits
➢ Increased customer value
➢ Increased customer satisfaction
➢ Improved customer loyalty
➢ Enhanced repeat business
➢ Enhanced reputation of the organization
➢ Expanded customer base
➢ Increased revenue and market share
2. LEADERSHIP
“Leadership is the art of getting someone else to do something you want done because he wants to do it.” - Dwight
Eisenhower

Leaders at all levels establish unity of purpose and direction and create conditions in
which people are engaged in achieving the organization’s quality objectives. Because creation
of unity of purpose and direction and engagement of people enable an organization to align
its strategies, policies, processes and resources to achieve its objectives.
Management is expected to:
➢ Define the objectives of the organization
➢ Ensure the availability of resources to achieve the objectives
➢ Involve staff
Key benefits
➢ Increased effectiveness and efficiency in meeting the organization’s quality objectives
➢ Better coordination of the organization’s processes
➢ Improved communication between levels and functions of the organization
➢ Development and improvement of the capability of the organization and its people to
deliver desired results

3. ENGAGEMENT OF PEOPLE
“Tell me and I forget. Teach me and I remember. Involve me and I learn.” - Benjamin Franklin

It’s about looking at the individual beyond the worker. The added value of the work of
the staff and the initiatives taken must me recognized. Personal skills must be developed,
which will improve the skills of the organization as a whole.
Competent, empowered, and engaged people at all levels throughout the organization
are essential to enhance its capability to create and deliver value.
To manage an 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 competence facilitate the engagement of people in achieving the
organization’s quality objectives.
Key benefits
➢ Improved understanding of the organization’s quality objectives by people in the
organization and increased motivation to achieve them
➢ Enhanced involvement of people in improvement activities
➢ Enhanced personal development, initiatives and creativity
➢ Enhanced people satisfaction
➢ Enhanced trust and collaboration throughout the organization
➢ Increased attention to shared values and culture throughout the organization
4. PROCESS APPROACH
“A civilization that proves unable to solve the problems that its functioning creates is a decadent civilization” -
Aime Cesaire

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 consists of interrelated processes. Understanding how
results are produced by this system enables an organization to optimize the system and its
performance.
To have a process approach is to consider the activity of the organism as a set of
correlated sub-activities. In this model, each process uses input data and produces output
data. This data can flow from one process to another.
This approach makes it easier to deal with the various activities, their management,
their needs, their objectives… It is moreover natural for a company to organize itself into
services, each managing one (or even several) processes.
Key benefits
➢ Enhanced ability to focus effort on key processes and opportunities for improvement
➢ Consistent and predictable outcomes through a system of aligned processes
➢ Optimized performance through effective process management, efficient use of
resources, and reduced cross-functional barriers
➢ Enabling the organization to provide confidence to interested parties as to its
consistency, effectiveness and efficiency

5. IMPROVEMENT
“Life is like riding a bicycle. To keep your balance, you must keep moving.” – Albert Einstein

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.
The organization must constantly seek to improve itself (continuous improvement), at
a minimum to maintain its performance levels, ideally to progress.
Improvement applies to principles already stated: improving customer satisfaction,
improving process performance. In ISO 9001:2015, reducing the risks, seizing opportunities
or correcting non-conformities are all sources of improvement.
Key benefits
➢ Improved process performance, organizational capabilities and customer satisfaction
➢ Enhanced focus on root-cause investigation and determination, followed by prevention
and corrective actions
➢ Enhanced ability to anticipate and react to internal and external risks and
opportunities
➢ Enhanced consideration of both incremental and breakthrough improvement
➢ Improved use of learning for improvement
➢ Enhanced drive for innovation
6. EVIDENCE-BASED DECISION MAKING
“What can be asserted without evidence can be denied without evidence.” – Euclid

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 decision making.
A very cartesian approach that can only be appealing, except that it requires work. The
idea is to reduce the uncertainty that is inevitable when making decisions, by relying on
objective data, where you look at causes to understand effects.
Key benefits
➢ Improved decision-making processes
➢ Improved assessment of process performance and ability to achieve objectives
➢ Improved operational effectiveness and efficiency
➢ Increased ability to review, challenge and change opinions and decisions
➢ Increased ability to demonstrate the effectiveness of past decisions

7. RELATIONSHIP MANAGEMENT
“Relationships are the mirror in which we discover ourselves.” – Jiddu Krishnamurti

The stakeholders encompass all actors who influence or are influenced by the activities
of the organization. It is by communicating with the interested parties and taking their
requirements into account that the organization will be able to improve its performance.
For sustained success, an organization manages its relationships with interested
parties, such as suppliers. Interested parties influence the performance of an organization.
Sustained success is more likely to be achieved when the organization manages relationships
with all of its interested parties to optimize their impact on its performance. Relationship
management with its supplier and partner networks is of particular importance.
Key benefits
➢ Enhanced performance of the organization and its interested parties through
responding to the opportunities and constraints related to each interested party
➢ Common understanding of goals and values among interested parties
➢ Increased capability to create value for interested parties by sharing resources and
competence and managing quality-related risks
➢ A well-managed supply chain that provides a stable flow of goods and services
 EVOLUTION OF QUALITY MANAGEMENT

Quality of a production process involves perfection, fast delivery, consistency,

providing a good usable product, eliminating waste, ensuring fitness for use and total
customer service and satisfaction.
Various methods for controlling quality of the products have evolved over the past 100
years.
Any one of the following methods should definitely be followed to ensure excellent &
outstanding quality of the production or manufacturing process.

1. INSPECTION
The first basic method of quality management was inspection. This involved
inspection of the correctness & quality of the process output at the producer's end or the
receiver's end. This method did not involve controlling the factors influencing the
process such as the process inputs or noise disturbances.
2. STATISTICAL PROCESS CONTROL
The next method that was adopted for quality management was SPC (Statistical
Process Control) This method involves verifying and measuring the fluctuations in the
output data of the process. This measure was provided as control feedback to the process,
thus controlling and bringing the inputs within a specific range that will give the
desired output. This method ensures that all the output products lie between the LSL
(Lower Specification Limit) and the USL (Upper Specification Limit).
3. DESIGN OF EXPERIMENTS
The next method that was followed for quality management was DOE (Design of
Experiments). This method focuses on identifying the cause and the effect of the quality
errors in the process under review. A process may involve the use of several inputs to obtain
an output. Each input may have a different impact on the quality of the output. This method
identifies the factors that cause severe fluctuations in the quality of the output through an
experimental method. Once the causative factors have been identified, this method will
involve controlling those factors to bring the output within the desired range.
DOE PROCESS
1. Define Problem
2. Determine Objectives
3. Brainstorm
4. Design Experiment
5. Verify Predicted Results
6. Interpret Results
7. Analyze Data
8. Conduct Experiment & Collect Data
4. TAGUCHI METHOD
The next method was introduced by a Japanese researcher named Taguchi. The
Taguchi method involves optimization of the design process involved in designing the
product and the process. Taguchi found that most of the errors and defects that occurred
in the products obtained as the outputs of a process were largely due to design errors. The
motive of the Taguchi method was to find which of the factors influence the product and the
process design. One of the design methods suggested by Taguchi was Robust Design. A
product designed in this method will maintain its performance regardless of the
surrounding disturbances like dust, humidity, high temperature, high pressure, etc.
“Cost is more important than quality but quality is the best way to reduce cost.” -Genichi Taguchi

5. QUALITY MANAGEMENT SYSTEMS

The next method that evolved for maintaining quality was quality management
systems. Some of the most popular quality management systems are TQM (Total Quality
Management), ISO 9000, ISO 14000, US 9000. These quality management systems cannot
directly control quality. Instead, they provide a framework that should be followed while
designing a process to ensure best quality output.
6. SIX SIGMA
The latest, most popular method for quality management is Six Sigma. This method
seeks to find and eliminate the causes of defects and errors in manufacturing and
service processes. It focusses on outputs that are critical to customers and necessary to
provide a clear financial return for the organization. It aims at producing no more than 3 to
4 PPM (parts per million) defects in the output of the process. This is a benchmark method
for maintaining the quality of the products of a process.
DMAIC
➢ Define
➢ Measure
➢ Analyze
➢ Improve
➢ Control
 COST OF QUALITY

What is Quality?
Quality is the degree of excellence of a product or service. It includes both tangible and
intangible factors such as reliability, durability, customer service, and overall satisfaction.
Investing in quality ensures that a product or service meets or exceeds customer
expectations.
It is the totality of characteristics of a particular product or service that has the ability
to satisfy the needs of the customers.
Measures of Quality
➢ A defect (or nonconformity) is the nonfulfillment of a quality characteristic from its
intended level.
➢ Defect is the specific point at which a specification is not satisfied.
➢ If an item does not conform to the requirement on one or more of several
characteristics, then the item is classified as a defective (or nonconforming item).
➢ Hence, a defective (nonconforming item) is a unit of product or service that does not
satisfy one or more of the specifications for that product.
➢ A defective may contain more than one defect.
What will happen if our product does not conform to requirements?

What it we wanted to stop the external failure cost?

The Cost of Poor Quality
Poor quality can lead to increased costs such
as rework, scrap, and warranty claims. It can
also damage a company's reputation and lead
to lost business. The cost of poor quality is
not just financial, it can also impact employee
morale and customer satisfaction. It is the
totality of characteristics of a particular
product or service that bears an ability to
satisfy the needs of the customers.
 COST OF NON-CONFORMANCE TO REQUIREMENTS COST OF POOR QUALITY

INTERNAL FAILURE COST EXTERNAL FAILURE COST

PREVENTION COSTS

PREVENTION COST
The cost of all the activities specifically designed to prevent poor quality in products or
services; preventing non- conformance to requirements.
1. Quality Planning
2. Training
3. Design Review
4. Design, development, and installation of quality measurements and test equipment
5. Quality auditing
6. Quality improvement programs and quality engineering (preparation of quality
manual, quality plans, standards and procedures)
APPRAISAL COSTS

Appraisal Cost
The cost associated with measuring, evaluating or auditing products or services to
assure conformance to quality standard performance requirements. Examples: source, in-
process inspections, calibration & audits
IMPLEMENTATION OF COQ FINANCIAL SYSTEM
1. Define your COQ Categories and data collection method.
2. Define your data collection method and the responsible person.
3. Collect, analyze and report Quality Cost Data and drive improvements.
The Main Objective of the COQ Program
The ultimate goal of a COQ System is to reduce the total cost of quality - which will
result in increased profitability & quality for the organization.
The Advantages of the COQ Program
➢ A COQ Program provide cost-benefit justification for needed Corrective Actions &
Improvement projects.
➢ A COQ Program assists you in quantifying the costs associated with inefficient or
incapable processes that result in unwanted variation & waste.
➢ A COQ Program highlights the importance of Prevention activities as an investment in
cost avoidance, and as a method to reducing quality costs.
The Advantages of the COQ Program
➢ A COQ Program highlights strengths & weaknesses of the Quality & Manufacturing
System.
➢ A COQ Program reframes improvement opportunities into financial benefits for ROI
analysis.
➢ A COQ Program exposes waste & other opportunities for improvement.
➢ A COQ Program reminds all employees that their actions are always contributing to
the organizations Bottom Line, either positively or negatively.
➢ A COQ Program drives a holistic perspective to Continuous Improvement by ensuring
that the overall benefits of an improvement project do not result in unintended
consequences somewhere else in the business.
The Limitations of the COQ Program
➢ Your COQ program it is merely a scoreboard for your current performance. You will
still need to analyze your problems to determine what the root cause is and then take
action to fix those problem.
➢ Inability to quantify the Hidden Quality Costs that every company experiences.

DOWNTIME

➢ Defects
➢ Overproduction-worst waste
➢ Waiting
➢ Non-utilized talent
➢ Transportation- 2nd worst waste
➢ Inventory
➢ Motion
➢ Extra-processing