ME-381: Total Quality Management

Chapter-3:
Organization Structure in TQM

By-
Dr. Niharika Gupta
Assistant Professor,
Department of Mechanical Engineering,
NIT Hamirpur
Contact no. 9958114561
 ROLE OF TOP MANAGEMENT IN TQM
❑Top management is generally a team of individuals at the highest level
of organizational management who have the day to-day
responsibilities of managing a corporation.
❑There are most often higher levels of responsibility, such as a board of
directors and those who own the company (shareholders), but they
focus on managing the senior management instead of the day-to-day
activities of the business.
❑They are sometimes referred to, within corporations, as senior
management, upper management, or simply seniors.
❑The first thing which top management must realise from the outset is
that TQM is a long-term business strategy.
❑The top management should start TQM implementation because they
are the primary internal change agent for quality improvement.
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❑In this situation, the top management has two major roles; they are
shaping organizational values and establishing a managerial
infrastructure to bring about change.
❑They must prepare themselves with knowledge about the criteria of
TQM and put in their mind the TQM agenda.
❑TQM is the management process used to make continuous
improvement to all functions in organizations.
❑The ideal continuous improvement process is the ones that begin with
and have genuine senior management involvement.
❑TQM implementation needs commitment to quality and continuously
improving from all levels of staff.

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 QUALITY COUNCIL

The quality council includes CEO and Senior

managers of the functional areas - research,
manufacturing, finance, sales, marketing etc. and
one coordinator and a union representative

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 Coordinator
❑ Coordinator’s position should be a bright young person with
executive potential.
❑ That person will report to the CEO.
❑ Responsibilities:
1.Build two-way trust, propose team needs to the council, share
council expectations with the team, and brief the council on team
progress.
2.Ensure that the teams are empowered and know their
responsibilities
❑ Activities: To assist the team leaders, share lessons learned among
teams, have regular leader’s meetings in smaller organization where
managers may be responsible for more than one functional area, the
number of members will be smaller
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 Duties of the quality council
❑ Develop with input from all personnel, the core values, vision
statement, mission statement, and quality policy statement.
❑ Develop the strategic long-term plan with goals and the annual
quality improvement with objectives.
❑ Create the total education and training plan.
❑ Determine and continually monitor the cost of poor quality.
❑ Determine the performance measure for the organization and
monitor them.
❑ Continually determine those projects that improve the processes,
particularly those that affect external and internal customer
satisfaction.

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 Continued..
❑ Establish multifunctional project and departmental or work group
teams and monitor their progress.
❑ Establish or revise the recognition and reward system to account for
the new way of doing business.
❑ Once the TQM program is well established, a typical meeting agenda
might have the following items; Progress report on teams, Customer
satisfaction report, Progress on meeting teams, Recognition dinner,
Benchmarking report

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 Quality Statements
❑VISION STATEMENTS - what an organization aspires to be tomorrow -
Successful visions are timeless, inspirational and become deeply
shared within an organization -criteria for decision making. E.g.:-
FLORIDA POWER & LIGHT Co- The Preferred Provider of Safe, Reliable,
and cost – effective products and services that satisfy the electric
related needs of all customers
❑MISSION STATEMENTS - who we are, who are the customers, what
we do, and how we do it - A Clear Statements of purpose For
Employees, Customers and Suppliers -one paragraph or less in length,
is easy to understand, and described the function of the organization
Eg.:- CANDIAN NATIONAL RAILWAYS- To Meet Customers’
transportation and distribution needs by being the best at moving
their goods on time, safely and damage Free.
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 Quality Statements
❑Quality Policy Statements: It is a Guide For Everyone in the organization as
to how they should provide products and services to the customer, written
by the CEO with feedback from the work face and be approved by the
quality council. Eg:-JOHNSON & JOHNSON To Make the Product Right First
Time and Every Time
➢ Common characteristics are: Quality is first among equals Meet the needs
of the internal and external customers. Equal or exceed the competition
Continually improve the quality. Include business and production practices
Utilize the entire work force.
➢ “Xerox is a quality company quality is the basic business principle for
Xerox. Quality means providing our external and internal customers with
innovative products and services that fully satisfy their requirements.
Quality is the job of every employee.” -XEROX CORPORATION
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 QUALITY CIRCLES
❑ Quality Circle is a small group of 6 to 12 employees doing similar work
who voluntarily meet on a regular basis to identify improvements in their
respective work areas using proven techniques for analyzing and solving
work related problems coming in the way of achieving and sustaining
excellence leading to mutual upliftment of employees as well as the
organization.
❑ It is "a way of capturing the creative and innovative power that lies within
the work force".
❑ An ideal size of quality circle is seven to eight members. But the number
of members in a quality circle can vary.
❑ “Quality Circles are (informal) groups of employees who voluntarily meet
together on a regular basis to identify, define, analyze and solve work
related problems.”
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 CONCEPT OF QUALITY CIRCLES
❑ The concept of Quality Circle is primarily based upon recognition of
the value of the worker as a human being, as someone who willingly
activates on his job, his wisdom, intelligence, experience, attitude and
feelings.
❑ It is based upon the human resource management considered as one
of the key factors in the improvement of product quality &
productivity.
❑ Quality Circle concept has three major attributes:

✓Quality Circle is a form of participate management.

✓Quality Circle is a human resource development technique.
✓Quality Circle is a problem-solving technique.
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OTHER NAMES OF QUALITY CIRCLES

• Small Groups
• Action Circles
• Excellence Circles
• Human Resources Circles
• Productivity Circles

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 NATURE OF QUALITY CIRCLES
❑ The generally regarded ideal size of a Q.C. is around ten members. As
every member of the Circle is expected to actively participate in the Q.C.
meetings, a large number is not good. Too small a few members would
tend to make the circle dormant.
❑ Ideally members of a particular Circle should be from the same work-
area or who do similar work, so that the problems they discuss will be
familiar to all of them.
❑ An organization may have a number of Q.Cs. If the number of workers of
any particular department/section who volunteer to join the Q.C. is more
than the ideal number that one Q.C. can accommodate, two or more
circles may be formed in the same area. Thus, an organization could have
one or more Q.C. in every department or section. There are organizations
where all the workers have become members of Q.Cs.
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 ORIGIN OF QUALITY CIRCLES
❑ Quality circles were first established in JAPAN in 1962; Kaoru Ishikawa has been
credited with their creation. The movement in Japan was coordinated by the
Japanese Union of Scientists and Engineers (JUSE).
❑ The first circles were established at the Nippon Wireless and Telegraph Company but
then spread to more than 35 other companies in the first year. By 1978 it was claimed
that there were more than one million quality circles involving some 10 million
Japanese workers. They are now in most East Asian countries; it was recently claimed
that there were more than 20 million quality circles in China.
❑ Quality circles have been implemented even in educational sectors in India, and QCFI
(Quality Circle Forum of India) is promoting such activities. However, this was not
successful in the United States, as it (was not properly understood and) turned out to
be a fault-finding exercise although some circles do still exist. ref Don Dewar who
together with Wayne Ryker and Jeff Beardsley first established them in 1972 at the
Lockheed Space Missile Factory in California.

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 OBJECTIVES OF QUALITY CIRCLES
❑ Promote job involvement
❑ Create problem solving capability
❑ Improve communication
❑ Promote leadership qualities
❑ Promote personal development
❑ Develop a greater awareness for cleanliness
❑ Develop greater awareness for safety
❑ Improve morale through closer identity of employee objectives with
organization's objectives
❑ Reduce errors.
❑ Enhance quality
❑ Inspire more effective team-work
❑ Build an attitude of problem prevention
❑ Promote cost reduction

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 CONTINUED…
❑ Develop harmonious manager, supervisor and worker relationship
❑ Improve productivity
❑ Reduce downtime of machines and equipment
❑ Increase employee motivation
❑ Change in Attitude from "I don’t care" to "I do care” Continuous improvement in
quality of work life through humanization of work.
❑ Self Development Bring out ‘Hidden Potential’ of People get to learn additional
skills.
❑ Development of Team Spirit Individual vs. Team – "I could not do but we did it"
Eliminate inter departmental conflicts.
❑ Improved Organizational Culture Positive working environment.
❑ Total involvement of people at all levels.
❑ Higher motivational level.
❑ Participate Management process.

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 THE ELEMENTS INVOLVED IN QCS
❑ It is a group effort and not an individual effort.
❑ The participating members are volunteers.
❑ Their efforts are directed to improve quality within their shops or
places of work.
❑ They meet frequently, often at company cost.
❑ They represent a cross-section of age, Gender and positions in
the organization.

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 IMPORTANCE OF QUALITY CIRCLE
❑ Rise in organization morale.
❑ Inspire more effective work.
❑ Promote job involvement.
❑ Create problem solving capability by member of quality circle
themselves.
❑ Promote personal and leadership activity.
❑ Improve communication within organization.
❑ Promote cost reduction.
❑ Increase employees’ motivation.

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 STRUCTURE OF QUALITY CIRCLE
1. A steering committee: This is at the top of the structure. It is headed by a senior
executive and includes representatives from the top management personnel
and human resources development people. It establishes policy, plans and
directs the program and meets usually once in a month.
2. Coordinator: He may be a Personnel or Administrative officer who co-ordinates
and supervises the work of the facilitators and administers the program.
3. Facilitator: He may be a senior supervisory officer. He co-operation the works of
several quality circles through the Circle leaders.
4. Circle leader: Leaders may be from lowest level workers or Supervisors. A Circle
leader organizes and conducts Circle activities.
5. Circle members: They may be staff workers. Without circle members the
program cannot exist. They are the lifeblood of quality circles.

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 PROCESS OF QUALITY CIRCLES
1. Problem identification: Identify several problems that need to be solved pertaining to
their work area.
2. Problem selection: Decide the priority and select the problem to be taken up first.
3. Problem Analysis: Problem is clarified and analyzed by basic problem-solving methods.
4. Generate alternative solutions: Identify and evaluate causes and generate number of
possible alternative solutions.
5. Select the most appropriate solution: Discuss and evaluate the alternative solutions by
comparison in terms of investment and return from the investment. This enables to
select the most appropriate solution.
6. Prepare plan of action: Prepare plan of action for converting the solution into reality
which includes the considerations "who, what, when, where, why and how" of solving
problems.
7. Present solution to management circle: members present solution to management fore
approval
8. Implementation of solution: The management evaluates the recommended solution.
Then it is tested and if successful, implemented on a full scale 20
 TECHNIQUES OF QUALITY CIRCLE
1. BRAIN-STORMING: The objective is to stimulate creativity and free
interaction among its members and a restraint of criticism.

2. CAUSE AND EFFECT DIAGRAMS: After a problem has been identified,

members are called to present cause for the same. Through discussions cause
and effect relationships can be arrived at after a number of meetings. A fish-
bone diagram can be drawn for the same.

3. SAMPLING & CHARTING METHODS: QC members are trained to observe key

events at the work-place and chart them in the specific sequence and
interrelationships. A pareto diagram is an example of events with a higher
frequency being highlighted.

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CONDITIONS FOR SUCCESS OF QUALITY CIRCLES
1. Active support and commitment from the part of top
management
2. Proper coordination.
3. Commitment and ability of facilitators and leaders.
4. Proper education about the quality circle philosophy and sufficient
training for facilitators, leaders, and members.
5. Systematic development of the quality circle movement. Only
limited number of circles shall be started initially, and the number
should be increased gradually. Starting many circles initially or
increasing the number very rapidly may cause problem of lack of
concentration, coordination etc.
6. The first circles to start should be in those areas with scope for
quick, tangible and easily visible results.
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 Quality Policy
➢ Clause 5.2 of ISO 9001 lays out the requirements for your quality
policy.
➢ As defined by ISO, a quality policy is simply a general statement of
your organization’s commitment to quality.
➢ It states your commitment to customer requirements, legal
requirements, and the requirements of the standard.
➢ It also contains your pledge to work toward continual
improvement
➢ A Quality Policy is a requirement of any formalized quality
management system (QMS), and its purpose is to set the
framework for the commitment of the scope of the QMS for
internal and external stakeholders.
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 Continued…
➢ A Quality Policy is typically a brief statement that aligns with an
organization’s purpose, mission, and strategic direction. It provides
a framework for quality objectives and includes a commitment to
meet applicable requirements (ISO 9001, customer, statutory, or
regulatory) as well as to continually improve.
➢ But a Quality Policy can be so much more. It can become a way to
drive passion for cultural change within an organization by
incorporating pieces of it into routine meetings and embedding it
into employee objectives and performance measurement.
➢ For example, some companies will incorporate a quality objective
directly into an employee’s annual goals. Examples could include
being involved in a continual improvement project or simply
maintaining compliance.
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 Continued…
➢ Most companies will post their Quality Policy on their websites
and within company buildings as a visual reminder to employees,
customers, and suppliers about their commitment to quality.
➢ Here is Quality Policy that believes, reflects the everyday way of
life and commitment to quality practiced at Thermo Fisher
Scientific:
❑ We fulfill our Mission to enable our customers to make the world
healthier, cleaner, and safer by continuously improving the quality
of our products and services and by ensuring global regulatory
compliance.

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 Continued…
❑ Quality for our customers means they can rely on our products
and services to consistently meet their specifications and
requirements.
❑ Quality for our colleagues means we take personal ownership to
ensure our work meets customer requirements and is error free
from design through use.
❑ Quality for regulatory authorities means that we operate at the
highest ethical standards and meet or exceed all applicable
regulatory requirements.
❑ Quality for our company means we drive a continuous
improvement culture that is enabled by practical process
improvement (PPI) and our company’s quality system.
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Levels of Management - Top, Middle and Lower
❑ The term “Levels of Management” refers to a line of demarcation between
various managerial positions in an organization.
❑ The number of levels in management increases when the size of the business and
work force increases and vice versa.
❑ The level of management determines a chain of command, the amount of
authority & status enjoyed by any managerial position.
❑ The levels of management can be classified in three broad categories:
1. Top level/Administrative level
2. Middle level/Executory
3. Low level/Supervisory/Operative
/First-line managers

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Top Level of Management
❑ It consists of board of directors, chief executive or managing director.
❑ The top management is the ultimate source of authority, and it manages goals
and policies for an enterprise.
❑ It devotes more time on planning and coordinating functions.
❑ The role of the top management can be summarized as follows -
✓ Top management lays down the objectives and broad policies of the enterprise.
✓ It issues necessary instructions for preparation of department budgets,
procedures, schedules etc.
✓ It prepares strategic plans & policies for the enterprise.
✓ It appoints the executive for middle level i.e. departmental managers.
✓ It controls & coordinates the activities of all the departments.
✓ It is also responsible for maintaining a contact with the outside world.
✓ It provides guidance and direction.
✓ The top management is also responsible towards the shareholders for the
performance of the enterprise.
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 Middle Level of Management
❑ The branch managers and departmental managers constitute middle level.
❑ They are responsible to the top management for the functioning of their
department.
❑ They devote more time to organizational and directional functions.
❑ In small organization, there is only one layer of middle level of management but
in big enterprises, there may be senior and junior middle level management.
❑ Their role can be emphasized as –
✓ They execute the plans of the organization in accordance with the policies
and directives of the top management.
✓ They make plans for the sub-units of the organization.
✓ They participate in employment & training of lower-level management.
✓ They interpret and explain policies from top level management to lower
level.
✓ They are responsible for coordinating the activities within the division or
department.
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 Middle Level of Management
✓ It also sends important reports and other important data to top level
management.
✓ They evaluate performance of junior managers.
✓ They are also responsible for inspiring lower-level managers towards better
performance.

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 Lower Level of Management
❑ Lower level is also known as supervisory/operative level of management. It
consists of supervisors, foreman, section officers, superintendent etc.
❑ Supervisory management refers to those executives whose work has to be largely
with personal oversight and direction of operative employees.
❑ In other words, they are concerned with direction and controlling function of
management.
❑ Their activities include –
✓ Assigning of jobs and tasks to various workers.
✓ They guide and instruct workers for day-to-day activities.
✓ They are responsible for the quality as well as quantity of production.
✓ They are also entrusted with the responsibility of maintaining good relation in
the organization.
✓ They communicate workers problems, suggestions, and recommendatory
appeals etc. to the higher level and higher-level goals and objectives to the
workers.
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 Lower Level of Management
✓ They help to solve the grievances of the workers.
✓ They supervise & guide the sub-ordinates.
✓ They are responsible for providing training to the workers.
✓ They arrange necessary materials, machines, tools etc for getting the things
done.
✓ They prepare periodical reports about the performance of the workers.
✓ They ensure discipline in the enterprise.
✓ They motivate workers.
✓ They are the image builders of the enterprise because they are in direct contact
with the workers.

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 PROBLEM SOLVING TECHNIQUES
❑ Problem solving is the act of defining a problem; determining the cause of the
problem; identifying, prioritizing, and selecting alternatives for a solution; and
implementing a solution.
❑ The Problem-solving Process: To effectively manage and run a successful
organization, leadership must guide their employees and develop problem-solving
techniques.
1. Define the problem:
✓ Diagnose the situation so that your focus is on the problem, not just its
symptoms.
✓ Helpful problem-solving techniques include using flowcharts to identify the
expected steps of a process and cause-and-effect diagrams to define and analyze
root causes.
✓ These steps support the involvement of interested parties, the use of factual
information, comparison of expectations to reality, and a focus on root causes of
a problem.
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 PROBLEM SOLVING TECHNIQUES
✓It should begin by:
I. Reviewing and documenting how processes currently work (i.e., who does
what, with what information, using what tools, communicating with what
organizations and individuals, in what time frame, using what format).
II. Evaluating the possible impact of new tools and revised policies in the
development of your "what should be" model.

2. Generate alternative solutions:

✓ Postpone the selection of one solution until several problem-solving
alternatives have been proposed.
✓ Considering multiple alternatives can significantly enhance the value of your
ideal solution.
✓ Once you have decided on the "what should be" model, this target standard
becomes the basis for developing a road map for investigating alternatives.
✓ Brainstorming and team problem-solving techniques are both useful tools in
this stage of problem solving. 34
 PROBLEM SOLVING TECHNIQUES
✓ Many alternative solutions to the problem should be generated before final
evaluation.
✓ A common mistake in problem solving is that alternatives are evaluated as
they are proposed, so the first acceptable solution is chosen, even if it’s not
the best fit.
✓ If we focus on trying to get the results we want, we miss the potential for
learning something new that will allow for real improvement in the problem-
solving process.

3. Evaluate and select an alternative

✓ Skilled problem solvers use a series of considerations when selecting the best
alternative.
✓ They consider the extent to which:
➢ A particular alternative will solve the problem without causing other
unanticipated problems.
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 PROBLEM SOLVING TECHNIQUES
➢ All the individuals involved will accept the alternative.
➢ Implementation of the alternative is likely.
➢ The alternative fits within the organizational constraints.

4. Implement and follow up on the solution

✓ Leaders may be called upon to direct others to implement the solution, "sell"
the solution, or facilitate the implementation with the help of others.
✓ Involving others in the implementation is an effective way to gain buy-in and
support and minimize resistance to subsequent changes.
✓ Regardless of how the solution is rolled out, feedback channels should be built
into the implementation.
✓ This allows for continuous monitoring and testing of actual events against
expectations.
✓ Problem solving, and the techniques used to gain clarity, are most effective if
the solution remains in place and is updated to respond to future changes.
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 TQM Tools for Effective Problem Solving and
Root Cause Analysis
❑ TQM tools have been around for more than 50 years and revolutionized the
concept of quality and process conformity.
❑ They are still used today, and successful companies appreciate that building quality
into the process is the only way to be competitive.

1. More than just quality control

Quality control traditionally focused on 100% inspection. That is, the Inspection
process catches the rejects at the end of the line or process, before the product gets
shipped to the customer. The problem is, 100% inspection is only 70% efficient. There
are guaranteed to be parts that get through the net and passed onto the customer.

2. Prevention is better than cure

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3. Strategic
❑ TQM tools and their implementation, capitalizes on the involvement of
management, workforce, suppliers, and even customers, to meet or exceed
customer expectations, building quality into the process.
❑ Some specialists highlight nine common TQM practices being:
• cross-functional product design,
• process management,
• supplier quality management,
• customer involvement,
• information and feedback,
• committed leadership,
• strategic planning,
• cross-functional training,
• Employee involvement.

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 TQM Tools
❑ In true nature of preventing rather than curing problems, some of the most
popularly used TQM Tools are as follows:
✓ Checklists
✓ Fishbone Diagrams
✓ Histogram charts
✓ Pareto Diagrams
✓ PDCA Cycle (Which TQM is built around)
✓ Process Flow Charts
✓ Process Control Chart

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