4.3.1: Lesson: Review of Total Quality Management

Module 4: Review of Total Quality Management

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Total Quality Management

  • Total Quality Management refers to the management of an entire organization so that it excels in all aspects of products and services that are important to the customer (Heizer, Render and Munson, 2017).
  • “TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction and benefits to all members of the organization and to the society.” - International  Organization for Standards

Principles of TQM

  1. Produce quality work the first time and every time.
  2. Focus on the customer.
  3. Have a strategic approach to improvement.
  4. Improve continuously.
  5. Encourage mutual respect and teamwork

Benefits of TQM

  • Improved quality.
  • Employee participation.
  • Team work.
  • Working relationships.
  • Customer satisfaction.
  • Employee satisfaction.
  • Productivity
  • Communication
  • Profitability
  • Market share.

 

Advantages of TQM

  • Improves reputation- faults and problems are spotted and sorted quicker.
  • Higher employee morale- workers motivated by extra responsibility ,team work and involvement in decisions of TQM.
  • Lower cost.
  • Decrease waste as fewer defective products and no need for separate

Disadvantages of TQM

  • Initial introduction cost.
  • Benefits may not be seen for several years.
  • Workers may be resistant to change

Obstacles to Implementing TQM

  1. Lack of company-wide definition of quality
  • efforts are not coordinated
  • people are working at cross-purposes
  • addressing different issues
  • using different measures of success
  1. Lack of strategic plan for change
  • without such a plan the chance of success is lessened
  • the need to address strategic implications of change is ignored
  1. Lack of customer focus
  • Without customer focus, there is a risk of customer dissatisfaction
  1. Poor intraorganizational communication
  • The left hand doesn’t know what the right hand is doing; frustration, waste and confusion ensue
  1. Lack of employee empowerment
    •             Not empowering employees, gives the impression of not trusting employees to fix problems and delays solutions
  1. View of quality as a “quick fix”
    • needs to be a long-term, continuing effort
  1. Lack of strong motivation
    • Managers need to make sure employees are motivated
  1. Lack of time to devote to quality initiatives
    •             Don’t add more work without adding additional
  1. Lack of Leadership
    •             Managers need to be leaders

 

Seven Concepts of TQM

1. Continuous improvement

2.  Six Sigma

3.  Employee empowerment

4.  Benchmarking

5. Just-in-time (JIT)

6. Taguchi concepts

7. Knowledge of TQM tools

Continuous Improvement

  • Represents continual improvement of all processes
  • Involves all operations and work centers including suppliers and customers
    • People, Equipment, Materials, Procedures
  • Walter Shewhart, another pioneer in quality management, developed a circular model known as PDCA (plan, do, check, act) as his version of continuous improvement.
  • The PDCA cycle (also called a Deming circle or a Shewhart circle)
    • As a circle - stress the continuous nature of the improvement process.

 

Shewhart’s PDCA Model

  1. Plan - Identify the improvement and make a plan
  2. Do - Test the plan
  3. Check - Is the plan working?
  4. Act - Implement the plan

Six Sigma

  • Originally developed by Motorola, adopted and enhanced by Honeywell and GE
  • Six Sigma
    • A program to save time, improve quality, and lower costs.
  • Two meanings
    • Statistical definition of a process that is 99.9997% capable, 3.4 defects per million opportunities (DPMO)
    • A program designed to reduce defects, lower costs, and improve customer satisfaction
  • Highly structured approach to process improvement
    • A strategy because it focuses on total customer satisfaction.
    • A discipline - DMAIC
  • Six Sigma is a comprehensive system— a strategy, a discipline, and a set of tools—for achieving and sustaining business success:

DMAIC Approach

  1. Defines the project’s purpose, scope, and outputs then identifies the required process information, keeping in mind the customer’s

     definition of quality.

  1. Measures the process and collects data;
  2. Analyzes the data, ensuring repeatability (the results can be duplicated) and reproducibility (others get the same result);
  3. Improves, by modifying or redesigning, existing processes and procedures;
  4. Controls the new process to make sure performance levels are maintained.

Employee Empowerment

  • Getting employees involved in product and process improvements
    • Research suggests that 85% of quality problems are due to process and material not with employee performance
  • Therefore, the task is to design equipment and processes that produce the desired quality.
  • This is best done with a high degree of involvement by those who understand the shortcomings of the system.
  • Techniques
    • Building communication networks
      that include employees
    • Developing open, supportive supervisors
    • Moving responsibility from both managers and staff to production employees;
    • Building high-morale organization
    • Creating such formal organization structures as teams and quality circles

Benchmarking

  • Selecting a demonstrated standard of performance of products, services, costs, or practices that represent the very best performance for processes or activities very similar to your own.
  • The idea is to develop a target at which to shoot and then to develop a standard or benchmark against which to compare your performance

The steps for developing benchmarks are:

  • Determine what to benchmark
  • Form a benchmark team
  • Identify benchmarking partners
  • Collect and analyze benchmarking information
  • Take action to match or exceed the benchmark

When an organization is large enough to have many divisions or business units, a natural approach is the internal benchmark.

  • Data are usually much more accessible than from outside firms.
  • Typically, one internal unit has superior performance worth learning from.

Just-in-Time (JIT)

  • The philosophy behind just-in-time (JIT) is one of continuing improvement and enforced problem solving.
  • JIT systems are designed to produce or deliver goods just as they are needed
  • Relationship to quality:
  1. JIT cuts the cost of quality
    • This occurs because scrap, rework, inventory investment, and damage costs are directly related to inventory on hand. Because there is less inventory on hand with JIT, costs are lower. In addition, inventory hides bad quality, whereas JIT immediately exposes bad quality.
  1. JIT improves quality
  • As JIT shrinks lead time, it keeps evidence of errors fresh and limits the number of potential sources of error. JIT creates, in effect, an early warning system for quality problems, both within the firm and with vendors
  1. Better quality means less inventory and better, easier-to-employ JIT system
  • Often the purpose of keeping inventory is to protect against poor production performance resulting from unreliable quality. If consistent quality exists, JIT allows firms to reduce all the costs associated with inventory.

Taguchi Concepts

  • Most quality problems are the result of poor product and process design.
  • Genichi Taguchi has provided us with three concepts aimed at improving both product and process quality
  • Taguchi Concepts
    • Quality robustness
      • Ability to produce products uniformly in adverse manufacturing and environmental conditions
      • Remove the effects of adverse conditions
      • Small variations in materials and process do not destroy product quality
    • Quality loss function
      • Shows that costs increase as the product moves away from what the customer wants
      • Costs include customer dissatisfaction, warranty and service, internal scrap and repair, and costs to society
      • Traditional conformance specifications are too simplistic
    • Target-oriented quality
      • A philosophy of continuous improvement to bring a product exactly on target

Knowledge of TQM Tools

  • To empower employees and implement TQM as a continuing effort, everyone in the organization must be trained in the techniques of TQM.
  • Tools of TQM, which are helpful in the implementation of the program, include: check sheets, scatter diagrams, cause-and-effect diagrams, Pareto charts, flow charts, histograms, and statistical control charts