EVOLUTION OF

TQM
 Which is more Important?

Quality of Management?
Or
Management of Quality?

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2
 What is Quality?
– Merriam Webster’s Collegiate Dictionary, 10th Edition(1994)
defines quality as
“an inherent feature; degree of excellence; and
superiority in kind
 Some definitions that have gained wide acceptance in the
corporate world
 “Meeting or exceeding customer expectations”
 Juran, one of the quality gurus, defined quality as;
 Fitness for Use
 Introduction
 Based on Juran‘s definiton, quality
therefore does not only have to be
perceived by the customer, but the
customer experience of quality of a
product or service is more important.
 Quality does not mean an
expensive product
 The American National Standards
Institute (ANSI) and the American
Society for Quality (ASO) defined quality
as;
 The totality of features and
characteristics of a product or service
that bears on its ability to satisfy
customer’s stated and implied needs.
 The Importance of Quality: The Japanese Chain Reaction
The Importance of Quality: The Japanese Chain Reaction

Improve Quality

Costs decreases due to fewer defects,

Lesser rework, fewer delays and better use
Of Men, Machine and Materials

Improve Productivity

Capture market with better quality

and lower price

Stay in business

Provide more jobs

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6
What is a customer?
Anyone who is impacted by the
product or services delivered by
an organization
External customer- the end user

Internalcustomer- other divisions

of the company that receive the
processed product.
 What is a product?
 the output of a process
carried by the organization. It
may be goods (e.g.
cellphones), software(e.g. a
computer code, a report) or
service (e.g. banking,
insurance
 How is customer satisfaction achieved?
Two Dimensions of Quality:
 Product feature- refers to the quality of
design.
 Ina manufacturing industry, it includes
performance, reliability, durability, ease of
use, esthetics, etc
 In a service industry, customer satisfation is
gained through accuracy, timeliness,
friendliness and courtesy, knowledge of
server, etc.
Freedom from deficiencies –
refers to quality of conformance
 Conformance to standards-
ability of the product or service to
conform to the stated and implied
requirements of customers.
 Higher conformance means
fewer complaint and increased
customer satisfaction
Why Quality?
Reasons why quality is a cardinal
priority for most organizations.
Competition
Changing customer-the new
customer is not only commanding
priority based on volume but is
more demanding about the “quality
system”
Changing product mix – the
shift from low volume high
price to high volume, low
price resulted in a need to
reduce the internal cost of
poor quality.
Product complexity- as systems
have become more complex the
reliability requirments for suppliers of
components have bome more tough

Higher level of customer satisfaction-

higher customer expectations are
getting spawned by increasing
competition.
History of quality management
…To know the future, know the
past!
 Before Industrial Revolution, skilled
craftsmen served both as
manufacturers and inspectors, building
quality into their products through their
considerable pride in their workmanship.
§ Industrial Revolution
changed this basic concept
– F. W. Taylor (“scientific
management” fame)
emphasized on the use of
scientific standards equitably to
managers as well as workers.
History of quality management
 …To know the future, know the past

Adam Smith who advocated

dividing the labor required to
make a product into simple,
repetitive tasks in order to
develop workers’ skills, save
time and use specialized
tools
Frank and Lilian Gilbreth’s
Time and Motion economy,
they believed that a way a task
is performed is as important
as the time it takes to do it.
History of quality management
 Statisticalapproaches to quality control
started at Western Electric with the separation
of inspection division. Pioneers like Dr.
Walter Shewhart, Deming W.Edwards and
Joseph M. Juran were all employees of
Western Electric.
– Dr.Walter Shewart (1891-1967) developed
the Plan, Do, Check Act (PDCA) cycle for
continuous improvement which is in use
even today
 After World War II, under General
MacArthur's Japan
rebuilding plan, Deming and Juran went
to Japan.
- Deming W, Edwards (1900-1993)
modified PDCA cycle of Shewart to the
Plan, Do, Study and Act (PDSA). He
also advocated the extensive used of
statistical quality control theory to
Japanese industry along with Juran.
Deming stressed the importance of
suppliers and customers for the business
development and improvement.
 He believed that people do their best and it
is the system that must change to improve
quality.
– His 14 Points for Management formed
the basis for his advise to top Japanese
management.
Joseph M. Juran (1904),
developed the Statistical
Quality Handbook for
Western Electric Company.
He identified Fitness of
quality and popularized
the same
Juran travelled to Japan to teach his own
theories- that hands-on management was
necessary at all levels of corporation to
ensure quality control and that problems are
opportunities to make improvements.
– His approach is still known today as the
Juran Trilogy;
quality planning, quality control and quality
improvement
In
Japan the following individual took
seed from this training and went on to
developed their own major
contributions to what is now Total
Quality Management:
 Shigeo Shingo worked with Ohno on
the TPS process and developed some
of its popular concepts including poka-
yoke (which means “mistake-proof in
Japanese and refers to taking human
judgement out of some types of
production, thereby minimizing human
errors)
Kaoru Ishikawa (1915-1989), strongly
advocated the use of cause and effect
diagram to provide a true representation of
the organizational impact and procedures.
He developed Fishbone or Ishikawa
diagram for cause and effect analyis.
Taichi Ohno, known as the father of just-
inTime production. He is also the co-
creator of Toyota Production System (TPS)
 Shigeo Shingo worked with Ohno on
the TPS process and developed some of
its popular concepts including poka-
yoke (which means “mistake-proof in
Japanese and refers to taking human
judgement out of some types of
production, thereby minimizing human
errors)
Next 20 odd years, when top managers
in USA focused on marketing, production
quantity and financial performance,
Japanese managers improved quality at
an unprecedented rate.
Market started preferring Japanese
products and American companies
suffered immensely.
America woke up to the quality revolution in
early 1980s. Ford Motor Company
consulted Dr. Deming to help transform its
operations.
(By then, 80-year-old Deming was virtually
unknown in USA. Whereas Japanese
government had instituted The Deming
Prize for Quality in 1950.)
Managers started to realize that “quality of
management” is more important than
“management of quality.” Birth of the term
Total Quality Management (TQM).
– TQM – Integration of quality
principles into organization’s
management systems.
Early 1990s: Quality management
principles started finding their way in
service industry. FedEx, The Ritz-Carton
Hotel Company were the quality leaders.
TQM recognized worldwide: Countries
like Korea, India, Spain and Brazil are
mounting efforts to increase quality
awareness.
The Deming 14 Point Philosophy

 The Deming Philosophy

Definition of quality, “A product or a service possesses quality if it helps somebody and enjoys a
good and sustainable market.”
Decrease cost because
Improve quality of less rework, fewer Productivity improves
mistakes.

Capture the market

Long-term Stay in with better quality
competitive business and reduced cost.
strength
 The Deming 14 Point Philosophy
1. Create and publish to all employees a
statement of the aims and purposes of the
company. The management must demonstrate
their commitment to this statement.
2. Learn the new philosophy.
3. Understand the purpose of inspection – to
reduce the cost and improve the
processes.
 The Deming 14 Point Philosophy
4. End the practice of awarding business on the
basis of price tag alone.
5. Improve constantly and forever the system of
production and service.
6. Teach and institute leadership.
7. Drive out fear. Create an environment of innovation.
8. Optimize the team efforts towards the aims and
purposes of the company.
 The Deming 14 Point Philosophy
9. Optimize the team efforts towards the aims
and purposes of thecompany.
10. Eliminate exhortations for the workforce.
11. Eliminate numerical quotas for production.
12. Remove the barriers that rob pride of
workmanship.
13. Encourage learning and self-improvement.
14. Take action to accomplish the transformation.
 Juran’s Quality Trilogy
Quality Trilogy –
1. Quality planning: Process of preparing to meet quality
goals. Involves understanding customer needs and
developing product features.
2. Quality control: Process of meeting quality goals during
operations. Control parameters. Measuring the deviation
and taking action.
3. Quality improvement: Process for breaking through to
unprecedented levels of performance. Identify areas of
improvement and get the right people to bring about the
change.
Major Quality Concepts
1. Balance Scorecard – Robert Kaplan and David Norton, suggest that
a business’s executive team measure progress in four areas that are
equally important
knowledge

 financial performance
 Internal business process and
 Learning / growth
 Major Quality Concepts
2. ISO Standards - The International Standardization (ISO).
 headquartered in Switzerland
more than 100 nations are “members”, that define and agree
on, and abide by a wide rang of product and process safety and
quality standards
the idea behind ISO certification is that products made in
different nations be compatible for use in others.
thisallows manufacturers to buy parts from suppliers in
other countries.
 Major Quality Concepts
The Quality Management Systems
(QMS) standards are know as “ISO
9000” family of standards; (ISO 9000-
2000, ISO 9001-2000, ISO 9004-2000);
the environmental management system
are ISO 14000 and so on.
Major Quality Concepts

3. Just-in-Time – a manufacturing theory of

producing just enough product to fill current
orders as they are due. “just –in time for
them to be used”
 Major Quality Concepts
4. Kaizen – a Japanese term fro “unending
improvement”
-Kaizen represents a system in which management
encourages and implements small, incremental
improvements, involving employees as team members
and creating a culture of workers who all striving to do
better
- it focuses on simplifying complex process and training
employees to measurable improve them.
Major Quality Concepts

5. Quality Circles – based on a Japanese

method of grouping people together in
“Quality Control” (QC), meetings where they
shared their expertise and worked to solved a
problem or improve process.
 Major Quality Concepts

6. Six Sigma – created by Motorola in 1980s. The name

refers to a scientific way of describing quality based on
variations that occur in any Greek letter that signifies the
standard deviations in a mathematical formula.
-the“sigma level” quantifies defects per million
opportunities (DPMO)
 Major Quality Concepts
 7. TOTAL QUALITY MANAGEMENT – a
comprehensive, organization-wide effort to improve
the quality of products and services, applicable to all
organizations.
- TQM quality is managed by the total effort of an
organization, and that each department or phase of
production is responsible for making its part of
the product or services as flawless as possible
before passing it on the next user or phase.