Productivity and Quality Management

Question Bank
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What is TQM? State the objectives and benefits of TQM (ppt 27,29) What are Quality management systems? State eight building blocks of TQM (ppt28)

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State 10 steps of TQM (ppt 26)

What is TPM and explain TPM awards (32-34) 14 points of Deming‟s philosophy(chpt7 &39-40 14 points of Crosby‟s philosophy (chpt 7 &41,42) Explain eight Principles of TQM (ppt17-25) What is Juran‟s Triology

Question Bank
What are Quality circles and how do they differ from Kaizen?  What are 5 „S‟ practices? (ppt 30)  What is BPR? Why is it necessary to initiate this before we start ISO 9000?  What is COQ? How do we bring down the COQ?  What is six sigma? (Ppt -10)

Question Bank
Explain Malcolm Baldrige award (ppt74,77)  what are the Techniques used in TQM (ppt 57)  State the factors affecting product and service Quality seperately (ppt78,79)

Improve Profit Increase Sales Volume (Increase Market share)  Increase Sale Price  Reduce Purchase cost of Input  Reduce cost of production  Improve quality (Reduce cost of Quality)  Improve productivity  .

Productivity and Quality Mgmt Differentiate  Production and Productivity  Inspection and Quality Control  System. Procedures and Processes  Quality Control and Total Quality Mgmt (TQM)  TQM and Six Sigma .

equipment. • Number of products / No. of hours taken to produce them • Revenue generated by employee / Salary of employee .Definition (Productivity is a ratio) The amount of output per unit of input (labor. and capital).Productivity.

Procedure and Process  System is a set of interactive elements corresponding to the given inputs to produce the desired output  Procedure is a set of activities which have to follow in a systematic format without taking any shortcuts Process is a set of activities/operations which follow the procedures and systems with right RM and intermittent checking to avoid any lapses.  .System.

transportation and everything else that happens between the beginning and the end of the process . inspection. delays. storage.Process  Process is a summation of activities such as operations.

Six Sigma      Six Sigma. TQM and Zero Defect When a process attains six sigma level it means that there is no room for the product to fail Six sigma is professionalizing of the Quality Management functions . which helps the organization in the improvement of their Quality Six Sigma is a systematical process which helps the organization to eleminate the defects which prevent it from reaching perfection Six Sigma ensures the QC.(The statistical Representation) is a process of Quality measurement.

999999 8 0.25% 5 .15% 6 99.45 99.999943 63 0.002 Less than 1% .Sigma Level 2 3 % Good PPM/DP MO 45500 2700 Cost of Quality as % of Sales Over 40% 25 .40% 95.9937 99.57 15 .73 4 5 99.

as well as NASA space and science programs . call centers. TQM has been widely used in manufacturing. and service industries.What is TQM ?  Total quality management (TQM) is a business management strategy aimed at embedding awareness of quality in all organizational processes. hospitals. education. government.

What is TQM ?  Total Quality Management (TQM) is a structured system for meeting and exceeding customer needs and expectations by creating organization-wide participation in the planning and implementation of improvement (continuous and breakthrough) processes .

mission and values to all employees and creating continuous improvement culture   .Total Quality Management  Total: Involve all functions to have customer focus and give reliable delivery of product+service in line with customer‟s expectations at lowest cost Quality: Design and manufacture the product+service to achieve zero defect and 100% customer satisfaction Management: Lead to achieve quality for customers by communicating the vision.

supplier Partnership   Just in Time/ Waste Elemination : (206) Total Quality Control: (207) TQC is aplicable to all functions. ISO 9000. Training  TPM. ISO 14000. use of SPC/SQC and PDCA. understand the processes critical to quality (CTQ) . Six Sigma. Small Group Acitvity. Key Business Process /Biz Process Re-engineering. customer satisfaction surveys. Zero Defect. use of 7 QC Tools.Techniques for TQM  Total Employee Involvement : (205) Kaizen. Quality Circles.

product and service.Why TQM ? In a global marketplace a major characteristic that will distinguish those organizations that are successful will be the quality of leadership. costeffective. innovative. they must be provided in a continuously improving. and productive manner . timely. work processes. management. This means that products must not only meet customer’s community needs for value. employees.

Principles of TQM 1. 3. 5. 2. 8. 7. 6. 4. Customer-Focused Organisation Leadership Involvement of People Process Approach System Approach to Management Continual Improvement Factual Approach to Decision Making Mutually Beneficial Supplier Relationships .

people. Ensure a balanced approach among customers and other stake holders‟ (owners. suppliers. Measure customer satisfaction & act on results. Communicate these needs and expectations throughout the organisation. etc. Manage customer relationships . delivery.Customer Focussed Organization      Understand customer needs and expectations for products. dependability. local communities and society at large) needs and expectations.1. price.

Understand and respond to changes in the external environment. and Implement a strategy to achieve these goals and targets. Promote open and honest communication. Educate. owners. Leadership             Be proactive and lead by example. encourage and recognise people's contributions. Consider the needs of all stake holders including customers. train and coach people. Establish a clear vision of the organisation's future. Provide people with the required resources and freedom to act with responsibility and accountability. Establish shared values and ethical role models at all levels of the organisation. .2. people. Inspire. Build trust and eliminate fear. Set challenging goals and targets. suppliers. local communities and society at large.

Focus on the creation of value for customers. local communities and society at large. Freely share knowledge & experience in teams.3. and enhance competencies. Involvement of People         Accept ownership and responsibility to solve problems. and Make people enthusiastic and proud to be part of the organisation. . Help people derive satisfaction from their work. knowledge and experience. Be innovative in furthering the organisation‟s objectives. Improve the way of representing the organisation to customers. Actively seek opportunities to make improvements.

and accountability for managing the process. Establish clear responsibility.4. Identify and measure the inputs and outputs of the process. consider process steps. Process Approach        Define the process to achieve the desired result. training needs. equipment. control measures. methods. suppliers and other stake holders of the process. materials and other resources to achieve the desired result. Identify the interfaces of the process with the functions of the organisation. activities. information. . Identify internal and external customers. Evaluate possible risks. flows. authority. suppliers and other stake holders of the process When designing processes. consequences and impacts of processes on customers.

. and Estimate the resource requirements and establish resource constraints prior to action. System Approach to Management      Define the system by identifying or developing the processes that affect a given objective. Continually improve the system through measurement and evaluation. Structure the system to achieve the objective in the most efficient way.5. Understand the interdependencies among the processes of the system.

processes and systems an objective for every individual in the organisation.and Recognise improvements. Promote prevention based activities. Use periodic assessments against established criteria of excellence to identify areas for potential improvement. Continual Improvements         Make continual improvement of products. on the methods and tools of continual improvement such as the Plan-Do-Check-Act cycle . process re-engineering. Provide every member of the organisation with appropriate education and training. Continually improve the efficiency and effectiveness of all processes. Apply the basic improvement concepts of incremental improvement and breakthrough improvement. and process innovation. Establish measures and goals to guide and track improvements. problem solving .6. .

reliable and accessible. Ensure that the data and information are sufficiently accurate. and Make decisions and take action based on the results of logical analysis balanced with experience and intuition. Understand the value of appropriate statistical techniques. . Analyse the data and information using valid methods.7. Factual Approach to Decision Making      Take measurements and collect data and information relevant to the objective.

8. Initiate joint development and improvement of products and processes. Jointly establish a clear understanding of customers' needs. Create clear and open communications. . Establish supplier relationships that balance short-term gains with long-term considerations for the organisation and society at large. Share information and future plans. Supplier Relationship        Identify and select key suppliers. and Recognise supplier improvements and achievements.

10. 6. 7. 9. 5.Ten Steps to TQM 1. Set company strategy. 8. 2. 4. values and culture Identify the customers and understand their expectations Define their specific needs Build the quality in the process from the begining(advocate prevention & not correction) Reduce chronic waste Reduce variation All levels of the organization must be involved/trained Continually improve the quality of product or service Use structured methodology for process improvement Use a balanced approach . 3.

Objectives of TQM   100% Customer Satisfaction Zero Defects Continuous Improvement Culture  .

6. Ethics Integrity Trust Training Teamwork Leadership Recognition Communication .Eight Building Blocks of TQM 1. 5. 7. 3. 4. 2. 8.

Benefits of TQM Ability to be more competitive  Improved market share  Cost reduction  Increased flexibility and responsiveness  Simplified processes  Improved communications  More satisfaction among the workforce  .

5 „S‟ Practices 1. Seiketsu: keep everything clean for constant state of readiness 5. 2. Shitsuke: Everyone must understand and practice the rules in the plant Seiri : separate out needed items Seiton: organize workplace for faster . retrieval (fix place for each item) 3. Seison: sweeping/cleaning around work area 4.

Predictive maintenance ( High tech analysis )  . Preventive maintenance (planned) 3.Maintenance Maintenance is done on the equipments to keep them running as efficiently as possible for as long as possible  There are three types of maintenance : 1. Breakdown maintenance (unplanned) 2.

developed in Japan. is a scientific company wide approach in which every employee is concerned about the maintenance .Total Productive Maintenance TPM . quality and efficiency of the equipment  The objective is to reduce the whole life cost of equipment through more efficient maintenance management and to integrate the maintenance and manufacturing functions  Teamwork is a key element of TPM  Analysis of each equipment focuses on reduction of manufacturing losses and costs  .

Total Productive Maintenance TPM aims to achieve improvements in cost. quality and speed (productivity)  This is equivalent to TQM (reduces variations due to automation)  TPM addresses six big losses reduced yield process defects reduced speed idling and minor stoppages setup and adjustment equipment failure  .

TPM Awards Effective 1971. the factories which have achieved company-wide efficiency & productivity by adopting company-wide TPM are given this award  . the factories which displayed remarkable achievement in plant maintenance were given this award  Effective 1989.

Five Pillars of TPM 1. New Equipment Management (design) 3.Cpk) 2. Autonomous Maintenance (military like) 4. Equipment Improvement (productivity) . Planned Maintenance (reduce unplanned) 5. Quality Integration (Process capability.

2. 3.TQM 1. 4. 5. 6. 7.Seven Deadly Disasters Dr Deming. Lack of consistency of purpose Emphasis on short term profits MBO and performance Appraisal system Job hopping by managers Using only visible data for decision making Excessive medical costs Excessive cost of liability .

Deming Application Prize For organizations or divisions of organizations that manage their business autonomously  Given to organizations or divisions of organizations that have achieved distinctive performance improvement through the application of TQM in a designated year  .

Deming Wheel Sales <<<<<<<< < Production I I  Research Design I I  Design Research I I  Production>>>>>>>>>>>SALES  .

6. 2. 7. 3. 5. 4.Dr Deming ( 1900-1993) 14 points 1. Create and publish statement of the aims and purpose for improvements Adopt new philosophies Do not depend on inspection for quality End the practice of contract to lowest bidder Continuously improve the system of production and service Institute training on the job Teach and institute leadership .

Dr Deming‟s 14 points 8. Encourage education and self improvement 14. create trust and climate for innovation 9. Estimate targets for workforce 11. Drive out fear. Eliminate annual rating and merit system 13. Eliminate quotas and institute methods of improvements 12. 10. Action to accomplish the transformation . Direct all efforts to aims and purposes of co.

4. 6. 5.Crosby‟s 14 steps (Born 1926) 1. 7. 3. 2. Commitment of top Management Quality improvement teams Establish Quality measurement Estimate Cost of quality Spread Quality Awareness Identify opportunities for improvement Committee for Zero defect monitoring .

13. 11. 10. Employee education Zero defect day Goal setting Error cause removal Recognition Quality councils Do it all again .Crosby‟s 14 steps (contd) 8. 9. 14. 12.

price of nonconformance (COQ)  .prevention  Performance standard.Crosby‟s 4 Absolutes of QM Crosby‟s philosophy: “Do it right the first time” The Four absolutes are:  Quality – conformance to requirements  System for causing defect  Measurement of quality.

Juran‟s Philosophy(1904-2008)  Quality = fitness for use by the customer Juran’s Triology: (Quality oriented Principles) Quality Planning Quality Control Quality improvement  1. . 2. 3.

Steps of Quality Control  Setting Quality standards Apraising conformance to these standards Acting when standards are exceeded Planning for improvements in standards    .

the manufacturer has to give assurance and also give evidence that the product will not fail .Quality Assurance  Definition : For the customer to buy the product/service with confidence and use it for a long time with ease and satisfaction.

Steps of Quality Assurance Develop quality plans  Carryout vendor quality surveys  Carryout product quality audits  Review disposition of non-conforming products  Initiate customers‟ future needs  Co-ordinate document control activity  Upgrade inspection records  .

Concepts of Quality      Variation is the main reason of poor Quality There is no such thing as Quality Problem. the first time The only performance measurement is the cost of Quality The only Performance standard is “ZERO DEFECT” . it is an opportunity to improve There is nothing like economics of is cheaper to do the job right .

Cost Of Quality Prevention Cost…….investment cost  Appraisal Cost……Inspection & Analysis  Internal Cost……Scrap and rework  External Cost……Customer Complaints Product Recalls and Returns  .

Cost of Quality .

Contribution of Quality Costs Prevention costs…..sharply decline as the product becomes stable  .High throughout  Appraisal costs……low/same throughout  Internal costs…….initially high. gradually declining  External costs……initially high. sharply decline (stability period)  Total Cost………..

the prevention cost will sharply go up and the total cost will also go up  Hence we have to find an economic Balance of Cost and Quality (six sigma)  . the total Cost of Quality keeps coming down  However if we improve the Quality beyond a certain point.Economic Balance of Quality and Costs As we keep improving the Quality.

Audit of COQ        Set an annual target of COQ Monitor the actual expenses of COQ All departments to control COQ Evaluate COQ every month/Quarter Compute COQ as a percentage of Sales At the start of TQM activity COQ and COQ as % of Sales is high. but gradually this comes down if TQM is implemented in the scientific manner Revise the annual target of COQ downwards year after year .

etc .The Customer Delight Customer awareness = keeping customer‟s requirements in mind These requirements are: Right Quality. Telephone directory. Railway Timetable. Right time & Right Cost The customer delight is far beyond customer satisfaction e.g: Taxi keeping newspapers. Right Quantity.

Repeat Orders Why customers Quit ? 1% die natural death  3% relocate  5% move away due to friends contact  9% due to competitive reasons  14% poor quality of product  68% indifferent attitude towards customers  .

on a continuous basis .Definition Of TQM  Old Definition of Quality: Products and services are provided exactly as per the specifications already laid down  New definition of TQM: Products and services that totally satisfy the customer needs and expectations in every respect.

SGA. use of SPC/SQC and PDCA .Techniques of TQM  Total Employee Involvement : Kaizen. use of 7 QC Tools. Quality Circles. material comes in the factory and directly goes for assembly instead of storing in stores  Total Quality Control: TQC is applicable to all functions. KBP/BPR  Just in Time/ Waste Elemination: No waiting.

Facilitator Steering Committee : For Pain Areas Shared Leadership : Develop the company objectives Communication : Annual Reward Policy : collectively Throughout the organisation Annual apraisals and recognition to performers  .Implementation Process of TQM          Training : Team Leaders. Facilitators and other employees Decision Style : Democratic firm decision Vision : Long Term Dream Mission : Short term objectives to achieve vision Quality Policy : Culture to be followed TQM Team Structure : Team Leader.

Elements of TQM              Commitment by senior management and all employees Meeting customer requirements Reducing development cycle times Just In Time/Demand Flow Manufacturing Improvement teams Reducing product and service costs Systems to facilitate improvement Line Management ownership Employee involvement and empowerment Recognition and celebration Challenging quantified goals and benchmarking Focus on processes / improvement plans Specific incorporation in strategic planning .

4. 3. Bill Gates:There will be a personal computer on every desk running microsoft software Vision Statement should answer: Why did I start this business When I move on from this business. what do I leave behind What am I providing for my customers beyond product/service If my business could be everything I dreamed how would it be .Vision Statement   1. 2.

it states why your organization is in business and what you are hoping to achieve Components of Mission Statement: The overall purpose of your business What is your business: product/service What is important for your businessthe values your business lives by . 2. Mission statement describes the WHAT of your business. 3.Mission Statement   1.

Expectations from the Mission Statement Mission draws on your belief statements  Mission must be future oriented and portray your organization as it will be  Mission must focus on one common purpose  Mission must be specific to the organization. not generic  Mission statement must be short. two sentences max  .

Quality Systems ( Quality Mgmt systems) The quality of the product is checked to see the variation  The control in variation wrt the design spec/dimension is aimed at  More the variation. poorer the quality  Less the variation better the quality  The analysis of variations ( control charts) give direction for the action to be taken to control the variation  .

Quality Management System  Quality Plan (Quality Assurance Plan) A Quality plan is a document specifying the quality management system elements and the resources to be applied in a specific case Product spec.quality verification and records to be kept to demonstrate conformity Activities to be considered are: .quality and delivery requirements. how the product/service is created and resources required.

Road Map of Quality Plan         Identify who the customers are Determine the needs of those customers Translate those needs into our language Develop a product that can respond to those needs Optimise the product features so as to meet our needs and customer‟s needs Optimise the process Prove that the process can produce the product under operating conditions Transfer the process to operation .

wanting to implement in house quality systems  These stds are developed by international organization for standardization (ISO)  These promote international trade by providing one consistent set of requirements recognized around the world  .ISO 9000 Standards ISO 9000 is a series of International stds  To be used by the cos.

g. BVQI for obtaining ISO 9000 certificate They guide the organization to make the quality manual of inhouse procedures and systems Management representatives are appointed to look after ISO requirements Any deviation is termed as NC and recorded in NCR (non conformity report) which needs to be resolved Then the certifying agency awards ISO 9000 certificate .ISO 9000 Certificate      Any organization in any business field can make application to the certifying agencies e.

Product identification and traceability 6. Quality records 11. Process control 7. Internal quality audits 12. Contract review 4. Quality system 3. Purchasing 5. Control of non conforming products 9. Statistical techniques . packing and delivery 10. Storage.This is an important document and covers the following areas of business: Quality Manual 1. Training 13. Management responsibility 2. Inspection and test equipments 8.

installation and services ISO 9002 covers Mfg and Mktg ISO 9003 covers installation and testing   .ISO 9000 Series  ISO 9001 covers product design. Mfg. marketing.

All organizations have to control the impact of their activities.ISO 14000      ISO 14001-1996 is a part of Quality Management system pertaining to environment management. products and services on the environment Most countries have stringent norms for control on pollution The company has to audit to assess their performance and ensure that it is within limits This system needs to be integrated with overall quality management system of the organization .

 QS-9000 helps companies to stay ahead of their competition. It does this by filling gaps in the quality systems that can cause problems  QS 9000 tells current and potential customers that the product has consistent quality and is manufactured under controlled conditions. Ford & General Motors and the companies having QS-9000 are considered to have higher standards and better quality products.  .QS 9000 (Now known as TS 16949) QS 9000 issued in 1994 is the name given to the Quality System Requirements of the automotive industry which were developed by Chrysler.

Business Process Re-engineering (BPR) BPR is a management approach aiming at improvements by identifying and implementing new ways of carrying out work. Thus elevating efficiency and effectiveness of the processes that exist within and across the organization .

Identify the business processes to be redesigned (challenge old processes) Evaluate old processes to avoid repetition of old mistakes Identify IT levers: awareness of IT capabilities can influence BPR process Design and build new process . time reduction.Steps of BPR      Develop the business Vision and process objectives such as cost reduction. output quality imrovement etc.

Malcolm Baldrige Award  1. 2. This annual award was introduced in US in 1987 to recognize US companies for Business Excellence and Quality achievement. The objectives were : To promote awareness of Quality To understand requirements for Performance Excellence Sharing of successful practices with other companies . 3.

Sharing of best practices 3. Improvement of overall co. training and assessment 4. planning. Improve performance practices and capabilities 2.Malcolm Baldrige Award Important Roles: 1. Serve as a working tool for managing performance. performance .

Process Management (Improvements) 6. Leadership 2.Malcolm Baldrige Award Award examines the quality of the organization in 7 categories: (100 marks each) 1. Customer Focus and Satisfaction . Strategic Planning 4. Human Resource Development & mgmt 5. Information and Analysis 3. Business Results (Improvements) 7.

strategic plans and trends of improvements in last 5 years in all areas of criteria (categories) The application shall be assessed and marks will be given to individual company The site visits shall be made by the examiners to verify the trends and practices . 2.Malcolm Baldrige Award  1. Steps for Examination Write the application with the overview of co . the vision and mission. 3.

5. 7. 8. 2. 3.Product and Service Quality Factors affecting Product Quality 1. 4. 9. 6. Men Materials Machines Manufacturing conditions Manufacturing process Capability to invest money Management commitment to Quality Product design (Tangible and *Intangible) After sales service (*Safety and Reliability) .

10. 8. 3. Security Competence Courtesy Understanding Access . 2. 5. 4. Quality Tangibility Reliability Responsiveness Communication 6. 9. 7.Product and Service Quality Ten Dimensions of Service Quality 1.

Some examples of Service Quality Answer the phone  Don‟t overpromise  Listen to your Customers  Deal with Complaints  Be helpful and knowledgeable  Train the staff to be courteous  Take the extra step  Throw in something extra  .

saved and resold later  The actual performance of service differs from provider to provider  .Service Quality Service quality has high level of intangibility  Most services are intangible as there are performances and not objects  Services are perishable . they can not be inventoried.

Quality Circles
QC is a small group of employees working on similar jobs, mostly at worker level to perform quality control and improvement activities within their workplace  These groups work on continuous improvements as a part of company wide activity  This was started in Japan in 1962 in line with the conviction of Ishikawa that the workers can significantly contribute to improve quality and productivity  Japan attributes phenomenal growth in 19601970 to QC

Quality Circles

2. 3.

Basic Objectives: Wider contribution towards improvement and development of the enterprise Respecting humanity and building a happy and cheerful workplace Exploiting human capabilities fully and drawing out infinite possibilities

Quality Circles Components of QC
1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Decide on the theme Establish the goals Clarify reasons and their importance Access the current situation Probe the causes and analyze them Establish corrective measures Implement the measures Evaluate results Standardize to prevent slipups Reflection of the results

Structure of Quality Circle
Top management (monitor progress)  Steering committee (Evaluate progress)  Facilitator (eliminate hurdles)  Leader and Dy Leader (guide members)  Members (study cause and effect)  Non members (give additional inputs)

Sequence of TQM Operational Management 5 „S‟ BPR  Quality Management QC ( Quality Circles) ISO TPM ( Total Productive Maintenance) Six Sigma ( For Processes CTQ )  .

Books For Reference Quality Mgmt Systems Devendra Kumar Bhatt / Aparna Raj  Productivity and Quality Mgmt Shashikant D Aphale Vipul Prakashan  .

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