Total Quality Management (TQM) Introduction and Evolution PDF

TOTAL QUALITY SCHOOL OF BUSINESS AND MANAGEMENT MANAGEMENT Instructor: Stephanie A. Moises  This course aims to discuss the following:. 1. Definition of Total Quality Management (TQM) 2. Definition of Quality 3. Importance of TQM 4. Evolution of TQM 5. Quality...

TOTAL QUALITY SCHOOL OF BUSINESS AND MANAGEMENT MANAGEMENT Instructor: Stephanie A. Moises  This course aims to discuss the following:. 1. Definition of Total Quality Management (TQM) 2. Definition of Quality 3. Importance of TQM 4. Evolution of TQM 5. Quality Gurus WOODGROVE 2 BANK  WHAT IS TOTAL QUALITY An Introduction MANAGEMENT? WOODGROVE 3 BANK TOTAL QUALITY MANAGEMENT Meeting quality expectations as defined by the customer. Integrated organizational effort designed to improved quality of processes at every business level. WOODGROVE 4 BANK WHAT IS QUALITY? Ways to define Quality WOODGROVE 5 BANK QUALITY Quality can be defined in 5 ways: Conformance to Specification Value for Price Use Does product or service meet Evaluation of usefulness versus target and tolerances defined by price paid. designers? Fitness for Use Support Services Evaluates performance for Quality of support after sale. intended use. Psychological Ambiance, prestige, friendly staff. WOODGROVE 6 BANK MANUFACTURING QUALITY VS SERVICE QUALITY Manufacturing Quality Quality can be defined in 5 ways: Service Quality Manufacturing quality focuses on Service organizations focuses on tangible product features such as: intangible products that must be 1. Conformance (Functionality) experienced. 2. Performance (Efficiency) Quality often defined by perceptional factors such as: 3. Reliability 1. Courtesy 4. Features (Portability) 2. Friendliness of staff 5. Durability (Maintainability) 3. Promptness in solving complaints, 6. Serviceability (Usability) 4. Atmosphere 5. Waiting time 6. Consistency WOODGROVE 7 BANK PRODUCT QUALITY 1) Functionality – core features and characteristics of a product. 2) Reliability – measured by mean (average) time between failures (MTBF). It is the indicator of durability of products. 3) Usability – a product should be easily usable. 4) Maintainability -ease with which a product can be maintained in the original condition. 5) Efficiency – the ratio of output to input. 6) Portability – set of attribute that bear on the ability of software to be transferred from one environment to another. WOODGROVE 8 BANK SERVICE QUALITY 1) Quality of Customer Service 2) Quality of Service Design 3) Quality of Service Delivery WOODGROVE 9 BANK ADDITIONAL ATTRIBUTES OF QUALITY For Product or Service Organizations ❑ Timeless ❑ Requirements of Society Delivery on schedule as per the The product should fulfil both REQUIREMENTS of the customer is a the stated and implied requirements must both in the product sector as well as imposed by society. in service sector. ❑ Aesthetics ❑ Conformance to Standards A product or service should not Product or service should only perform well but also appear conform to the stated and implied attractive. requirements of customers. ❑ Regulatory Requirements As stipulated by the local and federal governments should be fulfilled by the product or service. WOODGROVE 10 BANK QUALITY IN PRACTICE ❑ Motorola and GE attribute their success to having one of the best quality programs in the world. ❑ Six Sigma was implemented: a. Levels of Defects is reduced to 3.4 parts per million. b. Everyone is trained in quality improvement principles and techniques. c. Black-belt. Their full time job is to identify and solve quality problems. WOODGROVE 11 BANK COST OF QUALITY ✓ Quality effects all aspects of the organization and have dramatic cost implications. ✓ Most of obvious consequences of poor quality is dissatisfied customers and eventual loss of business. ❑ Prevention Cost – cost of preparing and implementing quality plan. ❑ Appraisal Cost – cost of testing, evaluating, and inspecting quality. ❑ Internal Failure Costs – cost of scrap, rework, and material loses. ❑ External Failure Costs – cost of failure at customer site, including return, repairs, and recalls. WOODGROVE 12 BANK COST OF DEFECTS WOODGROVE 13 BANK  EVOLUTION OF TOTAL Journey to Quality QUALITY MANAGEMENT WOODGROVE 14 BANK EVOLUTION OF TQM ❑ Early 20th Century – Quality meant inspection. Reactive in nature. ❑ 1980’s – Quality began to have strategic meaning. Proactive in nature. ❑ Successful companies understand that quality provides a competitive advantage. ❑ Put customer first, and define quality as meeting or exceeding customers expectation. ❑ Quality excellence has become a standard for doing business. WOODGROVE 15 BANK EVOLUTION OF QUALITY New Focus WOODGROVE 16 BANK  People behind Quality QUALITY GURUS WOODGROVE 17 BANK HISTORY OF TOTAL QUALITY MANAGEMENT (TQM) TIMELINE WOODGROVE 18 BANK  Quality Gurus Walter Shewhart (1920s & 1930s) ▪ Bell Telephone Engineer ▪ Grandfather of Statistical Quality Control (SQC) ▪ Contributed to understand the process of variability ▪ Developed concept of statistical control charts WOODGROVE 19 BANK William Edwards Deming (1940s & 1950s) ▪ Father of Statistical Quality Control ▪ Deming’s Cycle (PDCA) ▪ Stressed management’s responsibility for quality ▪ Developed “14” points to guide companies in quality improvement. ▪ Japanese established “Deming Prize” in his name ▪ 15% of quality problems are actually due to worker error ▪ 85% of quality problems are caused by systems and errors. WOODGROVE 20 BANK DEMING CYCLE (PDCA) WOODGROVE 21 BANK JOSEPH M. JURAN (1950) ▪ Defined quality as “fitness for use” ▪ Developed concept of cost of quality ▪ Originated idea of quality trilogy o Quality planning o Quality control o Quality improvement WOODGROVE 22 BANK JURAN’S QUALITY PLANNING ROADMAP 1) Identify your customers. 2) Determine their needs. 3) Translate them into your language. 4) Develop a product that can respond to the needs. 5) Develop processes, which are able to produce those product features. 6) Prove that the process can produce the product. 7) Transfer the resulting plans to the operating forces. WOODGROVE 23 BANK  ARMAND V. FEIGENBAUM (1960S) ▪ Introduced the concept of total quality control later called Total Quality Management (TQM) ▪ Total Quality Control is an effective system for integrating the quality development, quality maintenance, and quality improvement efforts of the various groups in an organization so as to enable production and service at the most economical levels which allow full customer satisfaction. ▪ Together with Deming and others ideas became basis for ISO:9000 WOODGROVE 24 BANK FEIGENBAUM’S CYCLE TIME REDUCTION METHODOLOGY 1) Define process. 2) List all activities. 3) Flowchart the process. 4) List the elapsed time for each activity. 5) Identify non-value adding tasks. 6) Eliminate all possible non-value adding tasks. WOODGROVE 25 BANK  PHILIP B. CROSBY (1970S) ▪ Coined phrase “quality is free” ▪ Introduced concept of “Zero Defects” ▪ Developed the phrase “Do it right the first time” ▪ He scorned the idea that a small number of defects is a normal part of the operating process because systems and workers are imperfect. ▪ He stressed the idea of prevention. WOODGROVE 26 BANK CROSBY’S FOUR ABSOLUTES OF QUALITY Quality is conformance to requirements, nothing more and nothing less and certainly not goodness or elegance. Quality has to be achieved by prevention and not by appraisal. The performance standard must be zero defect and not something close to it. The measurement of quality is the price of non- conformance. (How much the defect in design, manufacture, installation, and service cost the company). WOODGROVE 27 BANK  KAORU ISHIKAWA ▪ Developed cause-and –effect diagrams (also called Fishbone Diagram) ▪ Identified concept of “internal customer” ▪ Introduced the concept of “Quality Circles” WOODGROVE 28 BANK WOODGROVE 29 BANK WOODGROVE 30 BANK  GENICHI TAGUCHI ▪ Focused on Product Design Quality ▪ Developed Taguchi Loss Function o Cost of quality increase as a quadratic function as conformance value move away from target. ▪ Robust Design o A design that results in a product that can perform over a wide range of conditions. WOODGROVE 31 BANK QUALITY CONTROL How do we control quality? Is the operational techniques and activities that are used to fulfil the requirements for quality. 3 Steps of Quality Control 1) Evaluate actual performance. 2) Compare actual performance to goals. 3) Act on the difference. WOODGROVE 32 BANK QUALITY ASSURANCE All planned and systematic activities implemented within the quality system, and demonstrated as needed, to provide adequate confidence that an entity will fulfill the requirements for quality. WOODGROVE 33 BANK REQUIREMENTS FOR BUILDING PRODUCT QUALITY ❑Quality of Design – it refers how well the product or service has been designed to meet the current and future requirements of customers and add value to all the stakeholders (customers, employees, suppliers, owners and society). ❑Quality of Conformance – this indicate the consistency in delivering the designed product. ❑Quality of Performance – it is a indicator of the performance of the end product. ❑Quality of Service – It is the quality of associated services rendered that adds value to the product. It involves all the activities that will enable the customer to procure and use the product without any hassles. WOODGROVE 34 BANK QUALITY OF PLANNING The quality of 4 M’s (Man, Machine, Material and Methods). Involves planning for the following with regard to a product or service: ✓ Quality of objectives to be met. ✓ Specific of QA/QC practices. ✓ Resources needed. ✓ Sequence of QA/QC activities. WOODGROVE 35 BANK QUALITY IMPROVEMENT This process aims at attaining unprecedented levels of performance, which are significantly better than the past level. WOODGROVE 36 BANK STRATEGIC PLANNING It involves making plans for business value, investment in machinery and equipment, manpower to be hired, budget, product diversification, markets to be served and strategies for improving profits. WOODGROVE 37 BANK JUST-IN-TIME (JIT) Tai-ichi Ohno of Toyota motors refined an idea for Just-in-time. This means that no stage of manufacturing nobody or nothing waits for anything. This is to ensure that there is no wastage of machinery, materials, and manpower. WOODGROVE 38 BANK ISO 9000 STANDARDS Standards were released for the first time in the year 1987 to bring in system for quality in every organization. ISO stands for International Organization for Standardization. Worldwide federation of standard bodies with headquarter in Geneva, Switzerland. WOODGROVE 39 BANK DEMING AWARD FOR QUALITY (DEMING PRIZE) To express their gratefulness, Japanese instituted a Quality Award in the name of Deming in the year 1951. The award is now given not only to companies in Japan, but even overseas who excel in quality. OTHER QUALITY AWARDS AND STANDARDS ❑ Malcolm Baldrige National Quality Award (MBNQA) ❑ ISO 9000 Certification ❑ ISO 14000 Standards WOODGROVE 40 BANK QUALITY MANAGEMENT (QM) According to ISO 9000, quality management comprises “ all activities of the overall management function that determine the quality policy, objectives and responsibilities and implement them by means such as quality planning, quality control, quality assurance and quality improvement within the quality system. WOODGROVE 41 BANK  WOODGROVE BANK THANK YOU [email protected]