STRATEGIC MANAGEMENT

Continuous Improvement Strategy

T Q M : Definition, Concept &
Pillars of TQM

Breakthrough Improvement Strategy

Business Process Reengineering (BPR)

Prof Bharat Nadkarni

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Total Quality Management (TQM)

TQM is a technique developed by Edward Deming to improve

the efficiency of flexible work teams.

“Total quality management is defined as an integrated

approach in delighting customers (both internal and external)
by meeting their expectations on a continuous basis, through
everyone involved with the organization, working on
continuous improvement along with proper problem solving
methodology.”
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Pillars of TQM

1. Customer Satisfaction
2. Continuous improvement
3. Company-wide quality culture
4. Leadership & strategic planning
5. Employee involvement and focus
6. Stakeholder involvement and Focus
7. Top management committment
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Total Quality Management (TQM) . . . Contd.

1. Broad Goal of TQM is continuous improvement.

2. Aims to impress upon workers the importance of
continuously improving the efficiency of the production
process in order to a) Reduce Cost b) Improve Quality
c) Reduce Waste
3. Workers in a TQM system are expected to make
suggestions for improving all aspects of the work process
and are expected to share their specialized knowledge
with management so that it can be communicated through
out the organization.
TQM is a rational technique which is driven by hard statistical
data on the need for improvement.
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TQM seeks to introduce improvements through four key
components.
1. Systems
The need for improvement in the system is revealed by
statistical process control and benchmarking. Statistical
process control is the accurate and continuous
measurement of quality and is typified by the
measurement of frequency of failures – how often and
where failures are concentrated and the analysis of cause
and effect. Benchmarking is the activity of using the
achievements of some other organization that is very
successful in delivering quality as a model of what
company can achieve. TQM demands constant monitoring
and awareness of best practices.
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After improvement has taken place in the system, TQM
ensures the quality of operations through constant quality
assurance and quality control.
2. Processes
TQM regards every activity of the organization as a point
of a process. In so doing, it encourages the constant
review of processes through project improvement, waste
elimination, and process chain re-engineering. (revisiting
the process from improvement angle)
3. People
Yet another component of TQM is people. TQM
organizations value their employees both as individuals as
well as for their contribution to the growth of the
organization. The value placed on the quality of individuals
is demonstrated through hiring the best, enabling life-long
learning, elimination of specialization,
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instituting suggestion schemes, and establishing quality

circles.
4. Management
TQM requires at the top management vision and mission
for the organization, commitment for quality, empowering
employees, and open mind for recognizing and
appreciating achievers.
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New & Old Cultures
Quality Element Previous State TQM

Definition Product oriented Customer oriented

Priorities Second to service & cost First among equals of service

& cost
Decisions Short - Term Long - Term

Emphasis Detection Prevention

Errors Operations System

Responsibility Quality control Everyone in organization

Problem solving Managers Teams

Procurement Price Life-cycle costs, partnership

Manager’s role Plan, Assign, Control, Delegate, Coach, Facilitate,

Enforce Mentor
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Deming’s Chain Reaction in TQM
Improve Quality

Cost Decreases

Productivity Improves

Capture market with better quality and lower prices

Stay in business

Expand, Provide jobs and more jobs

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Six Sigma
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Business Process Reengineering (BPR)

Definition by M Hammer.
BPR is defined as the critical analysis or fundamental
rethinking and radical redesign of existing business processes
to achieve breakthrough or dramatic improvements in
performance measures such as cost, quality, service and
speed.
BPR has often been confused with the quality movement.
Quality specialists tend to focus on incremental change and
gradual improvement of processes, while proponents of
reengineering seek radical redesign and drastic improvement
of processes.
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It is based on four key words:

1. Fundamental
Why do we do what we do? And Why do we do it the way
we do?
Why the old rules and assumptions exist?
2. Radical
Disregard all existing structures and procedures, and
inventing completely new ways of accomplishing work.
3. Dramatic
Not about making marginal improvements.
4. Processes
a. Dysfunctional b. Importance c. Feasibility
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Systematic redesign of Processes

1. Eliminate

2. Simplify

3. Integrate

4. Automate
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1. Eliminate
• Over production
• Waiting time
• Transport
• Processing
• Inventory
• Defects/ Failures
• Duplication
• Reformatting
• Inspection
• Reconciling
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2. Simplify
•Forms
•Procedures
•Communication
•Technology
•Problem areas
•Flows
•Processes
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3. Integrate
•Jobs
•Teams
•Customers
•Suppliers
4. Automate
•Dirty
•Difficult
•Dangerous
•Boring
•Data capture
•Data transfer
•Data analysis
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Thank You
 Total Quality Management : Prof Bharat Nadkarni
Management Game : Expectations from Taxi or Taxi Driver
• Safe driving
• Polite and decent
• Clean Taxi
• Driver in uniform
• Well maintained taxi
• Comfortable seats
• Knowledge of roads
• Keeping enough change
• Enough space for keeping luggage
• Newspaper
• Thought pad & pen
• Yellow page directory
• Railways/ Airline timetable
• First Aid Box
• Music
• Calendar
• Driver not having any vices
• Suggestion / Complaint book
• Air conditioner
• Fan
• Paper napkins
• Film / Business magazine
MURA (Discrepancy)
Inconsistencies in the system
• Happens sometimes
• Happens at some places
• Happens to some people
Mura principle is applied to
innovations.
MURI (Physical strain)
• Bend to work
• Push hard
• Lift weight
• Repeat tiring action
• Wasteful walk
MUDA (Waste)
• Wasteful activity (non value
creation)
• Obstruction to smooth flow of an
activity
Activity = Work + Muda
Expenditure = Cost + Waste
Less Muda means more happy
clients
MUDA (Waste)
• Due to over production

• Due to waiting time

• Due to unwarranted transportation

• Due to inventory

• Due to process wastage

• Due to lost opportunity

• Due to defects