TOPIC 4: TQM (MEM605)

TQM – The Implementation

(Part 1)

Prepared By: Dr Shahriman Adenan

Revised by: Ir Dr Noriah Yusoff

09/06/2020
1
 TOPIC 4: CONTENT
The content of this topic includes:
1. Deming Cycle, continuous improvement,
employee empowerment, benchmarking,
JIT and Taguchi Concept
2. Implementation Strategy: Hoshin Kanri
3. Common Implementation Mistakes

09/06/2020

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 Implementation of TQM by using
Deming’s philosophy
The Fourteen Points For The Transformation
Of Management (Deming’s 14 points)
• 14 key principles for management to follow
for significantly improving the effectiveness of
a business or organization. Many of the
principles are philosophical. Others are more
programmatic. All are transformative in
nature.
 Deming’s 14 points
1. Create constancy of purpose toward
improvement of product and service, with
the aim to become competitive and to stay
in business, and to provide jobs.
2. Adopt the new philosophy. We are in a
new economic age. Western management
must awaken to the challenge, must learn
their responsibilities, and take on
leadership for change.
3. Cease dependence on inspection to
achieve quality. Eliminate the need for
inspection on a mass basis by building
quality into the product in the first place.
4. End the practice of awarding business on
the basis of price tag. Instead, minimize
total cost. Move toward a single supplier
for any one item, on a long-term
relationship of loyalty and trust.
5. Improve constantly and forever the system
of production and service, to improve
quality and productivity, and thus
constantly decrease costs.
 Deming’s 14 points…
6. Institute training on the job.
7. Institute leadership. The aim of
supervision should be to help
people and machines and gadgets
to do a better job. Supervision of
management is in need of overhaul,
as well as supervision of production
workers.
8. Drive out fear, so that everyone may
work effectively for the company
9. Break down barriers between
departments. People in research,
design, sales, and production must
work as a team, to foresee problems
of production and in use that may
be encountered with the product or
service.
 Deming’s 14 points…
10. Eliminate slogans, exhortations, and
targets for the work force asking for zero
defects and new levels of productivity.
Such exhortations only create
adversarial relationships, as the bulk of
the causes of low quality and low
productivity belong to the system and
thus lie beyond the power of the work
force.
– Eliminate work standards (quotas)
on the factory floor. Substitute
leadership.
– Eliminate management by
objective. Eliminate management
by numbers, numerical goals.
Substitute leadership.
11. Remove barriers that rob the hourly
worker of his right to pride of
workmanship. The responsibility of
supervisors must be changed from sheer
numbers to quality.
12. Remove barriers that rob people in
management and in engineering of their
right to pride of workmanship. This
means, inter alia, abolishment of the
annual or merit rating and of
management by objective (see Ch. 3).
13. Institute a vigorous program of
education and self-improvement.
14. Put everybody in the company to work
to accomplish the transformation. The
transformation is everybody's job.
Deming’s 14 points…summary
Employee Empowerment
 Employee Empowerment…
• Giving people throughout the organisation the
power to make a difference, contributes greatly
to providing quality products and services to their
customers
• Empowerment is a natural extension of employee
involvement
• Empowerment represents a high degree of
involvement in which employees make decisions
themselves and are responsible for their
outcomes
 Employee Empowerment…
Empowerment can be defined as a
multidimensional social process that helps
people gain control over their own lives. It is a
process that fosters power in people for use in
their own lives, their communities and in their
society, by acting on issues they define as
important.
 Employee Empowerment…
Empowerment can also be defined in terms
of management as giving someone power-
granting the authority to do whatever is
necessary to satisfy customers, and trusting
employees to make the right choices without
waiting for management approval.
 Employee Empowerment…
The possibility of empowerment depends on
two things.
• First, empowerment requires that power can
change. If power cannot change, if it is
inherent in positions or people, then
empowerment is not possible, nor is
empowerment conceivable in any meaningful
way. In other words, if power can change,
then empowerment is possible.
 Employee Empowerment…
• Second, the concept of empowerment
depends upon the idea that power can
expand. This second point reflects our
common experiences of power rather than
how we think about power.
 THE IMPORTANCE OF EMPOWERMENT

• Giving employees responsibility for their own

work has led to improvement in quality,
productivity, motivation, customer service,
speed of decision making and morale
• Employee involvement creates the
organisational context need to support quality
Improvement processes
 THE IMPORTANCE OF EMPOWERMENT

• Empowerment led to greater levels of

satisfaction among the workforce
• Empowered employees give faster and
friendlier service to their customers
• Employee satisfaction strongly related to
customer satisfaction
• Maintaining an enjoyable work environment
frees people to concentrate solely to the
needs of their client
HOW EMPOWERMENT LEADS TO QUALITY
 PRINCIPLES OF EMPOWERMENT

Empower sincerely and completely

• Empower for improvement value, not for
public relations value
• Semi empowerment does not work,
• Set clear guidelines on responsibility and
authority
• Managers need to be patient on results
 PRINCIPLES OF EMPOWERMENT…
Establish mutual trust
• Trust must be backed up by
actions.
• Managers must not take
advantage from increased
productivity by cutting the
workforce.
• Provide employees with
business information.
Sharing business
information with employee
relates directly to quality,
customer services and
competitiveness.
 PRINCIPLES OF EMPOWERMENT…

Ensure that employees

are capable:
• To operate in an
empowered
environment, the
employees need the
technical and
interpersonal skills
• Ensure employee
capability by selecting
and training employees
 PRINCIPLES OF EMPOWERMENT…

Do not ignore middle management

• Roles for middle managers:
– Maintain focus on the organization‘s values
• Manage solutions to system-level problems
• Act as teachers and coaches
 PRINCIPLES OF EMPOWERMENT…
Change the reward system
• Intrinsic rewards – that are part of the job
itself and the personal satisfaction of
accomplishing something worthwhile i.e.
responsibility, challenge, autonomy, purpose
and feedback or rewards that are self-
administered
• Extrinsic rewards, including pay for skills and
profit sharing
 BENCHMARKING
HISTORY:
• 1979, Xerox Corp. initiated a process called
‘competitive benchmarking’ due to stiff
competition from the Japanese.
• By 1981, benchmarking was adopted
• Benchmarking then moved from
manufacturing aspects to service and from
competitor benchmarking to other methods
of benchmarking
 BENCHMARKING…
• Term benchmarking was first used by cobblers to
measure people's feet for shoes. They would
place someone's foot on a "bench" and mark it
out to make the pattern for the shoes.
• used to measure performance using a specific
indicator (cost per unit of measure, productivity
per unit of measure, cycle time of x per unit of
measure or defects per unit of measure)
resulting in a metric of performance that is then
compared to others.
 What is Benchmarking?
• Benchmarking is the process of comparing
one's business processes and performance
metrics to industry bests and/or best practices
from other industries.
• Dimensions typically measured are quality,
time, and cost. Improvements from learning
mean doing things better, faster, and cheaper.
 What is Benchmarking?...
Benchmarking involves management
identifying the best firms in their industry, or
any other industry where similar processes
exist, and comparing the results and processes
of those studied (the "targets") to one's own
results and processes to learn how well the
targets perform and, more importantly, how
they do it.
 What is Benchmarking?...
A number of reasons for benchmarking,
including to:
• improve productivity and lower costs,
• accelerate and manage change,
• achieve breakthroughs and innovation,
• set performance targets, and
• create a sense of urgency.
 What is Benchmarking?...
Definition;
• According to David T Kearnes (former CEO of
Xerox):
• Benchmarking is the continuous process of
measuring products, services and practices
against the toughest competitors or those
companies recognised as industry leaders.
 What is Benchmarking?...
• Benchmarking Clearinghouse defines
benchmarking as:
• “Benchmarking is the practice of being
humble enough to admit that someone else is
better at something, and being wise enough
to learn how to match and even surpass them
at it”.
 What is Benchmarking?...
• Grinyer and Goldsmith said that
benchmarking is:
• “ the ongoing structured process ofmeasuring
and improving products, services, practices
and processes against the best that can be
identified worldwide to achieve and
sustaincompetitive advantage”.
 Benchmarking Methodology
• Phase 1: Plan—establish the project scope,
develop the data collection approach and
requirements, and set the criteria for peer
groups.
• Phase 2: Collect—collect data.
• Phase 3: Analyze—analyze and validate
information collected to identify performance
levels, leading practices, enablers, and proven
templates and other tools.
• Phase 4: Adapt—report and develop action plan
for change.
 Types of Benchmarking
• 1. Competitive Benchmarking – comparisonof
the organisation’s performance againstone or
more competitors.
• 2. Functional Benchmarking – a variation of
process benchmarking that compares a
function of the organisation to the same
function in other organisations.
 Types of Benchmarking…
• 3. Generic Benchmarking – a variation of
process benchmarking that compares like
processes of two or more organisations
without limitation to competition of the same
industry.
• 4. Industry Benchmarking – comparison of
processes within organisation in the same
industry, but not necessarilycompetitors
 Benefits of Benchmarking
1. Defines the gap between the organisation’s
performance and other organisations’
performance creating a desire to change for the
better.
2. Integrates the best policies into the
organisation.
3. Creates a culture of continuous improvement.
4. Gives positive impact on employee pride and
morale.
 Benefits of Benchmarking…
5. Develops effective measurement systems
6. Improve individual and team creativity
7. Identifies strengths and weaknesses of an
organisation.
8. Helps in setting realistic targets and
implementation plans.
 Just-in-Time (JIT)
Relationship to quality:
• JIT cuts cost of quality
• JIT improves quality
• Better quality means less inventory and better,
easier-to-employ JIT
 Just-in-Time (JIT)…
• ‘Pull’ system of production/purchasing
– Customer starts production with an order
• Involves ‘vendor partnership programs’ to
improve quality of purchased items
• Reduces all inventory levels
– Inventory hides process & material problems
JIT Example
END Part 1