Approaches of Total Quality & Cost of

Quality
Content

1.1. Learning objectives

1.2. Approaches to Total Quality Management: An Introduction
1.3. The Deming Management Philosophy
1.4. System of Profound Knowledge
1.5. Deming’s 14 Points for Management
1.6. The Juran Philosophy
1.7. Juran’s Quality Trilogy
1.8 Juran’s 10 Points for Management
1.9. The Crosby Philosophy
1.10. Four Absolutes of Quality Management
1.11. Crosby’s 14 Points for Management
1.12. The Kaoru Ishikawa Philosophy
1.13. Framework for Quality and Performance Excellence
1.14. Just-in-Time (JIT)
1.15. Business Process Reengineering
1.16. Kaizen Approach – A Continuous Improvement Tool
1.17. SO-9000 Standards
1.18. Quality Audit
1.19. Principles of Quality Management
1.20. Seven Principles by Gerald F. Smith
1.21. International Quality Award Programs
1.22. The Deming Prize
1.22 The Malcolm Baldrige National Quality Award
1.23 The European Quality Award
1.24 The Rajiv Gandhi National Quality Award
1.25 Cost of Quality
1.26 Examples of ‘Cost of Quality’

Learning Objectives

Upon successful completion of this course, the students will be able to demonstrate,
Practice and:

1. Understand the different approaches to Total Quality Management.

2. Know the importance of Framework for Quality and Performance Excellence.
3. Understand the Principles of Total Quality Management.
4. Familiar with the concept of Quality Cost.
5. Know the basics of International Quality Award Programs
Introduction

Approaches to Total Quality Management: An Introduction

Total Quality Management is mainly concerned with continuous improvement in all

works and functional activities of an organization. It is a long-term planning. It is the
consistent improvement in the quality. It is a never-ending process. It describes a
management approach to long–term success through customer satisfaction. In a TQM
effort, all members of an organization are involved in improving processes, products,
services, and create a culture in which they work. The success of the TQM depends on
the significant changes in organization design, work processes, and culture. There are
various approaches to TQM. Some organizations give importance to the use of quality
programmed like statistical process control and some organizations give importance to
the tool like quality function deployments. Sometimes, the organizations fail to realize
quality improvements because of lack of holistic understanding of the quality tool(s) or
concept(s) by the entire organization.
“Total Quality Management (TQM) is a comprehensive and structured approach to
organizational management that seeks to improve the quality of products and services
through ongoing refinements in response to continuous feedback. TQM requirements
may be defined separately for a particular organization or may be in adherence to
established standards, such as the International Organization for Standardization's ISO
9000 series. TQM can be applied to any type of organization; it originated in the
manufacturing sector and has since been adapted for use in almost every type of
organization imaginable, including schools, highway maintenance, hotel management,
and churches. As a current focus of e-business, TQM is based on quality management
from the customer's point of view.” (www. searchcio.techtarget.com)i

Total Quality Management is a management approach for an organization, centered on

quality, based on the participation and commitment of all the internal and external
customers and aiming at strategically long-term success through customer satisfaction,
and benefits to all members of the organization and to society. It uses strategy, data,
and
effective communications to integrate the quality discipline into the culture and activities
of the organization. So, some organizations adopt a problem-solving focus and
concentrate on production as well as customer service processes. They adopt quality
circles and team approaches. Some organizations concentrate on error prevention
through continuous process improvement and business process reengineering. Most of
the successful companies have adopted unique approaches of total quality
management according to their own requirements because one approach suitable for
one organization may be not suitable for another organization. The reason is the
difference in the culture.

Every organization has different culture.

Total Quality Management requires a set of guiding principles and concepts. The all-
over world-famous quality gurus like Deming, Juran, Crosby, Ishikawa, as well as many
others, have made substantial contribution to the theory and practice of quality
management. Their philosophies, concepts, principles have helped to shape the
framework for quality management. Quality management as a discipline is incomplete
without their contribution and approaches to total quality.

A discussion of their philosophies which are more about management of quality as

follows:

The Deming Management Philosophy

William Edwards Deming (1900-1993) was an American engineer, statistician,

professor, author, lecturer, and management consultant. He developed some sampling
techniques which are still used by the U.S. Department of the Census and the Bureau of
Labor Statistics. He always advocated that there is no substitute for knowledge. He
found great inspiration in the work of Walter Shewhart like Statistical Process Control,
Operational Definitions, and the PDSA (Plan-Do-Study-Act) Cycle. The Deming called
PDSA as ‘The Shewhart Cycle’. He taught statistical process controls to the Japanese
engineers and managers and the message was very much clear that the improvement
in quality will reduce expenses while increasing productivity and market share. Deming
is best known for his 14 Points for quality and his system of thought called the System
of Profound Knowledge. He stressed that the system of profound knowledge is very
important because it helps the managers to transform within their organizations which
improves the outcomes in the form of quality.

System of Profound Knowledge

The four parts of the System of Profound Knowledge are:

 Appreciation of a System
 Knowledge of Variation
 Theory of Knowledge
 Knowledge of Psychology
Deming’s 14 Points for Management

The Deming’s fourteen principles are named as:

1. Constancy of Purpose
2. Adopt the New Philosophy
3. End Lowest Tender Contracts
4. Improve Every Process
5. Institute Training on the Job
6. Drive Out Fear
7. Break-down Barriers
8. Eliminate Exhortations
9. Eliminate Arbitrary Numerical Targets
10. Permit Pride in Workmanship
11. Encourage Education
12. Top Management Commitment to Action
13. Cease the Need for Mass Inspection
14. Institute Leadership

The Juran Philosophy

Joseph M. Juran was an industrial engineer. He Joined Western Electric in the 1920s.
He authored ‘The Quality Control Handbook’ which is often referred to as the quality
bible and is a classic reference for quality engineers. Juran proposed a simple definition
of quality: “fitness for use.” This definition of quality suggests that it should be viewed
from both external and internal perspectives; that is, quality is related to “(a) product
performance that results in customer satisfaction; (b) freedom from product deficiencies,
which avoids customer dissatisfaction.” He believed that quality improvement should be
achieved through projects. He revolutionized the Japanese philosophy on quality
management. Dr. Juran was the first to incorporate the human aspect of quality
management which is referred to as Total Quality Management. He focused on three
major quality processes, called the:

Juran’s Quality Trilogy. According to Juran, quality processes are summed up by the
Tribology. It means that the management of quality consists of three inter-related
quality-oriented processes namely:

 Quality Planning.
 Quality Control; and
 Quality Improvement.

Juran’s 10 Points for Management. Juran has given 10 Points for Quality
Improvement:

1. Build awareness of need and opportunity for improvement to realize that all
processes are improvable.
2. Set goals for improvement
3. Organize to reach goals
4. Provide training
5. Carryout projects to solve problems
6. Report progress
7. Give recognition
8. Communicate results
9. Keep score
10. Maintain momentum by making annual improvement part of the regular systems
and processes of the company.

The Crosby Philosophy

Philip Bayard Crosby, (1926 –2001) was a businessman and author who contributed to
management theory and quality management practices. He is best known in relation to
the concepts of ‘Zero Defects’ and ‘Do it Right First Time’. He authored a number of
books, of which the book entitled ‘Quality is Free’ is the most popular in which he stated
that “Quality is free. It’s not a gift, but it is free. What costs money are the unqualify
things -all the actions that involve not doing jobs right the first time.” His two other books
are ‘Quality without Tears’ and ‘The Art of Getting Your Own Sweet Way’.

Four Absolutes of Quality Management

Crosby’s TQM approach is based on his four absolutes of Quality Management:

 First absolute: Quality is defined as conformance to requirements
 Second absolute: Problems are functional in nature
 Third absolute: There is no optimum level of defects
 Fourth absolute: Cost of quality is the only useful measurement

Crosby’s 14 Points for Management

Philip Crosby developed 14 steps for an organization to follow in building an effective

quality program:

1. Management Commitment
2. Quality Improvement Team
3. Quality Measurement
4. Calculate the Cost of Quality
5. Raise Quality Awareness among Employees
6. Instigate Corrective action
7. Monitor Progress of Quality Improvement – establish a ‘Zero Defects’ Committee
8. Train Supervisors in Quality Improvement
9. Zero Defects Day
10. Encouraging Employees to Create Quality Improvement Goals
11. Error-cause Removal
12. Recognize Participants’ Effort
13. Create Quality Councils
14. Do it over again

The Kaoru Ishikawa Philosophy

This approach was given by Kaoru Ishikawa was born on July 13, 1915. He graduated
in applied chemistry in 1939. He was a Japanese organizational theorist, Professor at
the Faculty of Engineering at The University of Tokyo. He is one of the Japan’s quality
control pioneers. He is considered a key figure in the development of quality initiatives
in Japan, particularly ‘the quality circles’ in which small group of employees meet
regularly to improve quality and productivity. He developed the Ishikawa or cause and
effect diagram or fishbone diagram often used in the analysis of industrial processes.
He emphasized the development of participation and bottom-up of quality which is now
main philosophy of the Japanese approach to quality management. He advocated that
the first concern for management is the happiness of the people connected with it. If
people are not happy then it does not deserve to survive.