TQM Chapter 1

Chapter 1
Introduction to
Quality
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing 1
Modern Importance of Quality
“The first job we have is to turn out quality
merchandise that consumers will buy and
keep on buying. If we produce it efficiently
and economically, we will earn a profit, in
which you will share.”
- William Cooper Procter
Key Idea
Building—and maintaining—quality into

an organization’s goods and services,
and more importantly, into the
infrastructure of the organization itself, is
not an easy task.
Quality Assurance
...is any action directed toward providing
customers with goods and services of
appropriate quality.
History of Quality Assurance
(1 of 3)
 Skilled craftsmanship during Middle Ages

 Industrial Revolution: rise of inspection
and separate quality departments
 Early 20th Century: statistical methods at
Bell System
 Quality control during World War II
 Post-war Japan: evolution of quality
management
(2 of 3)
 Quality awareness in U.S.

manufacturing industry during 1980s:
from “Little Q” to “Big Q” - Total
Quality Management
 Malcolm Baldrige National Quality
Award (1987)
 Disappointments and criticism
Key Idea
Although quality initiatives can lead to

business success, they cannot guarantee
it, and one must not infer that business
failures or stock price dives are the result
of poor quality.
(3 of 3)
 Emergence of quality management in service

industries, government, health care, and education
 Evolution of quality to performance excellence
 Growth and adoption of Six Sigma
 Current and future challenge: continue to apply the
principles of quality and performance excellence.
Quality is “a race without a finish line.”
Contemporary Influences on
Quality
 Globalization
 Innovation/creativity/change
 Outsourcing
 Consumer sophistication
 Value creation
 Changes in quality
Defining Quality
Perfection Fast delivery
Providing a good, usable product
Consistency
Eliminating waste
Doing it right the first time
Delighting or pleasing customers
Total customer service and satisfaction

Compliance with policies and procedures
Formal Definitions of Quality
 Transcendent definition: excellence
 Product-based definition: quantities of
product attributes
 User-based definition: fitness for intended
use
 Value-based definition: quality vs. price
 Manufacturing-based definition:
conformance to specifications
Quality Perspectives
transcendent &
product-based user-based
needs
Marketing
Customer
products value-based Design

and manufacturing-
services based
Manufacturing
Distribution
Information flow
Product flow
Key Idea
Because individuals in different business

functions speak different “languages,”
the need for different views of what
constitutes quality at different points
inside and outside an organization is
necessary to create products of true
quality that will satisfy customers’ needs.
Customer-Driven Quality
 “Meeting or exceeding customer

expectations”
 Customers can be...
 Consumers
 External customers
 Internal customers
Total Quality
 People-focused management system
 Focus on increasing customer satisfaction
and reducing costs
 A systems approach that integrates
organizational functions and the entire
supply chain
 Stresses learning and adaptation to change
 Based on the scientific method
Principles of Total Quality
 Customer and stakeholder focus

 Participation and teamwork
 Process focus supported by continuous
improvement and learning
…all supported by an integrated organizational

infrastructure, a set of management practices,
and a set of tools and techniques
Customer and Stakeholder
Focus
 Customer is principal judge of quality
 Organizations must first understand
customers’ needs and expectations in
order to meet and exceed them
 Organizations must build relationships
with customers
 Customers include employees and
society at large
Key Idea
To meet or exceed customer expectations,

organizations must fully understand all
product and service attributes that
contribute to customer value and lead to
satisfaction and loyalty.
Participation and Teamwork
 Employees know their jobs best and
therefore, how to improve them
 Management must develop the systems and
procedures that foster participation and
teamwork
 Empowerment better serves customers, and
creates trust and motivation
 Teamwork and partnerships must exist both
horizontally and vertically
Key Idea
In any organization, the person who

best understands his or her job and
how to improve both the product and
the process is the one performing it.
Process Focus and Continuous
Improvement
A process is how work creates value for
customers
 Processes transform inputs (facilities,
materials, capital, equipment, people,
and energy) into outputs (goods and
services)
 Most processes are cross-functional
Key Idea
A process is a sequence of activities

that is intended to achieve some result
Continuous Improvement
 Enhancing value through new products
and services
 Reducing errors, defects, waste, and costs
 Increasing productivity and effectiveness
 Improving responsiveness and cycle time
performance
Key Idea
Major improvements in response time may

require significant simplification of work
processes and often drive simultaneous
improvements in quality and productivity.
Deming’s View of a
Production System
Suppliers of
Design and
materials and
Redesign
equipment Consumer
Receipt and test research
of materials
A Consumers
Production, assembly
B inspection
C Distribution
D Tests of processes, machines, methods
INPUTS PROCESSES OUTPUTS
Feedback
Learning
 The foundation for improvement …
Understanding why changes are successful
through feedback between practices and
results, which leads to new goals and
approaches
 Learning cycle:
 Planning
 Execution of plans
 Assessment of progress
 Revision of plans based on assessment findings
Infrastructure, Practices, and
Tools
Infrastructure
Leadership Strategic HRM Process Information and knowledge
Planning mgt. management
Practices Performance Training

appraisal
Tools Trend chart
TQ Infrastructure
 Customer relationship management
 Leadership and strategic planning
 Human resources management
 Process management
 Information and knowledge management
Competitive Advantage
 Is driven by customer wants and needs
 Makes significant contribution to business
success
 Matches organization’s unique resources with
opportunities
 Is durable and lasting
 Provides basis for further improvement
 Provides direction and motivation
Quality supports each of these characteristics

Quality and Profitability
Improved quality Improved quality

of design of conformance
Higher perceived Higher Lower

value prices manufacturing and
service costs
Increased market Increased
share revenues
Higher profitability
Key Idea
Considerable evidence exists that

quality initiatives positively impact
bottom-line results.
Quality and Business Results
Studies
 General Accounting Office study of Baldrige

Award applicants
 Hendricks and Singhal study of quality
award winners
 Performance results of Baldrige Award
recipients
Key Idea
An organization that is committed to total

quality must apply it at three levels: the
organizational level, the process level, and
the performer/job level.
Three Levels of Quality
 Organizational level: meeting external
customer requirements
 Process level: linking external and
internal customer requirements
 Performer/job level: meeting internal
customer requirements
Quality and Personal Values
 Personal initiative has a positive impact on
business success
 Quality-focused individuals often exceed
customer expectations
 Quality begins with personal attitudes
 Attitudes can be changed through awareness and
effort (e.g., personal quality checklists)
 Unless quality is internalized at the personal
level, it will never become rooted in the culture of
an organization. Thus, quality must begin at a
personal level (and that means you!).
Key Idea
In the daily attempt to bring about change in the
individual parts of the organizational universe,
managers, employees, professors, and students
can find that personal quality is the key to unlock
the door to a wider understanding of what the
concept really is all about.

TQM Chapter 1

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TQM Chapter 1

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Chapter 1

Building—and maintaining—quality into

 Skilled craftsmanship during Middle Ages

 Quality awareness in U.S.

Although quality initiatives can lead to

 Emergence of quality management in service

Total customer service and satisfaction

products value-based Design

Because individuals in different business

 “Meeting or exceeding customer

 Customer and stakeholder focus

…all supported by an integrated organizational

To meet or exceed customer expectations,

In any organization, the person who

A process is a sequence of activities

Major improvements in response time may

Practices Performance Training

Tools Trend chart

Quality supports each of these characteristics

Improved quality Improved quality

Higher perceived Higher Lower

Considerable evidence exists that

 General Accounting Office study of Baldrige

An organization that is committed to total

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