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The role of

Quality and
productivity in
achieving
world class
competitiveness

a company with a laurel of world class excellence is expected to offer best quality products and service with total customer delight.  Thus. calls for one thing alone. and that is the world class excellence. . motivating and empowering people.  All companies strive to increase productivity. and internally to be able to embrace the best practices of management techniques such as total quality management. being “world-class” is an indicator that an organization is performing at the top level in the world for a specific market. and expand business opportunities . drive costs lower. social responsibility and etc.  Simply put. international benchmarking.  The world class excellence defines the highest business performance at a global level that stood the test of time. continuous improvement.Introduction  To achieve long lasting business success.

demand declines.THE PRODUCTIVITYQUALITY CONNECTION  The more we can produce while using fewer resources.  Productivity : measured as a ratio of outputs to inputs  Quality: A product’s fitness for use plus its success in offering features that consumers want  Quality drives productivity  Improved productivity is a source of greater revenues. profits decline  Country that improves its ability to make something out of its existing resources can increase the wealth of all its inhabitants. the more productivity grows and the more profitable businesses are. . employment opportunities and technological advances PRODUCTIVITY CHALLENGE  Quality declines.

having world-class quality will deliver 99% defect free products to an organization's customers. which will build its reputation and bring additional businesses. .  Secondly. they affect the bottom line. Having worldclass quality improves customer satisfaction and drives rapid market penetration. they affect the top line. Having worldclass productivity allows projects to be finished in significantly less time and reduces total cost.why strive for world-class productivity and world-class quality?  First.  Additionally.

engineering. and business management.  Quality function deployment(QFD): is a method to transform user demands into design quality.Techniques of quality management  Total quality management (TQM): consists of organization-wide efforts to install and make permanent a climate in which an organization continuously improves its ability to deliver high-quality products and services to customers. refers to philosophy or practices that focus upon continuous improvement of processes in manufacturing. and ultimately to specific elements of the manufacturing process.  Kaizen : Japanese for "improvement" or "change for the best". and to deploy methods for achieving the design quality into subsystems and component parts. . to deploy the functions forming quality.

 Business process re-engineering(BPR): is a business management strategy. Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes. cut operational costs and become world-class competitors.Cntd…  Six Sigma: is a set of techniques and tools for process improvement. BPR aimed to helps organizations to fundamentally rethink how they do their work in order to dramatically improve customer services. . focusing on the analysis and design of workflows and processes within an organization.

and food assembly processes--all with the objective of faster service.Example  McDonald's has a reputation for high-quality service resulting from its application of established TQM principles.  Restaurant managers meet with customer groups on a regular basis and use questionnaires to identify quality "defects" in its operation.  It empowers all employees to make spot decisions to dispose of unfresh food or to speed service. food inventory.  It provides fresh food promptly on demand.  The McDonald's work force is flexible so that changes in customer traffic and demand can be met promptly by moving employees to different tasks. which is essentially an inventory situation. . It monitors all phases of its process continuously from purchasing to restrooms to restaurant decor and maintenance in a total quality approach.  Extensive use is made of IT for scheduling. cooking procedures. cash register operation.

.  With QFD. Toyota reported 20% reduction in start-up costs.example  After four years of training and preparation.  Upon introducing four new van-type vehicles. It requires a shift from traditional manufacturing quality control to product design quality control.  This is where QFD is so effective at reducing costs. designed-in quality is stressed which means designing quality into the products and their manufacturing processes so that the products are produced error free.  The QFD system challenges status quo thinking. the product development cycle was reduced by a third with a corresponding improvement in quality because of a reduction in engineering changes. the QFD system has been used by Toyota and has reported impressive results. further a 38% reduction. and a cumulative 61% reduction in further periods.  Also during this period. the remaining 20 percent are in the implementation/manufacturing phase.  It has been seen that typically 80 percent of overall costs occur in the design phase.

rather than merely operating like machines.  This involvement creates responsibility for the success of the process.example  The philosophy of kaizen is one of Toyota’s core values. . skills and experience of the people working directly in the process.  Every morning a meeting is held to discuss quality deviations and eliminate their causes. relying on the extensive knowledge.  Kaizen involves everybody.000 proposals for improvements are made each year.  The Toyota Production System invites team members to think about the process and make timely decisions in order to keep it running smoothly. about 3.  And at Toyota Material handling Europe’s production sites. increasing both morale and quality.

process and personnel development by using Six Sigma as a tool for innovation. Korea. efficiency and quality.  SEC saw the universal adoption of Six Sigma throughout the company’s 16 businesses worldwide as the way to perfect its fundamental approach to product. SEC has integrated Six Sigma into its entire business process. (SEC) of Seoul. process and personnel development. is perfecting its fundamental approach to product. .example  Samsung Electronics Co.  To achieve the goal of efficiency and timeliness.

meat. and stadiums. beans. airport.  Currently they are redefining how to deliver their food services. big savings and more time to focus on the customer business processes. universities.  Taco Bell cites the following results: greater quality control. schools.example  Taco Bell as a part of BPR created the K-Minus program (Kitchen less restaurant) based on their belief that they are a retail service company. . corn shells. not a manufacturing company. fewer employee accidents and injuries. tomatoes and cheese for their products are prepared outside of the restaurant in central commissaries.  At the Taco Bell restaurants. by taking their food service to places where people gather such as dining centers.  In the new process. lettuce. better employee morale. the food ingredients are prepared when ordered for customer consumption.

 Lean manufacturing : is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful.  Material requirements planning (MRP): is a production planning and inventory control system used to manage manufacturing processes.Techniques of production management  Just in time (JIT): is a production strategy that strives to improve a business‘ return on investment by reducing in-process inventory and associated carrying costs. . and thus a target for elimination.

 In addition. as well as helps to improve business‘ return on investment by reducing in-process inventory and associated carrying costs.M.example  JIT helps to reduce waste and add value.  Dell Computer Corporation has tuned its Just-in-Time system so that an order for a customized personal computer that comes in over the internet at 9 AM. . can be on a delivery truck to the customer by 9 P. Dell's low cost production system allows it to under price its rivals by 10% to 15%.

And it's one that requires a seismic culture shift away from the old ways of designing and manufacturing products. continue winning new business across the enterprise. and at the lowest possible cost. but a philosophy of growth.example  Lean. a concept that designs. . manufactures.  It uses a "just-in-time" system that gives internal and external customers what they want. Lean is about remaining competitive in a rapidly changing global marketplace.  At its root. delivers and supports products more efficiently and at lower costs — while systematically identifying and eliminating waste — all the way through the product life cycle. it constantly finds ways to make its products cost-competitive. and create and sustain jobs. when they want it.  In order for Boeing to survive as an aerospace leader.  The implementation of Lean tactics across Boeing isn't merely a costcutting strategy. executing business processes — and of managing and developing people.

servicing more than 65 countries.example  Asian Paints is India's largest paint company. for which they used the technique of MRP wherein they could do production planning and inventory control. Asian Paints needed an integrated solution that would address variable demand and determine which products should be produced at which manufacturing plants.  In order to ensure optimum raw materials selection across its complex. multi-site manufacturing operations.  Business Benefits  Reduced finished goods inventory from 56 days to 30 days  Achieved 87-90 percent service levels for sales at the location level  Dramatically improved debt-to-asset ratio . It operates in 18 countries and has 26 paint manufacturing facilities.

those who don’t are doomed to failure” .“The name of the game is competition. The playing field is global. Those who understand how to play the game will succeed.