TOTAL 

QUALITY MANAGEMENT
Dr.N.SHANTHI
PROFESSOR/CSE
 UNIT - I
Quality (Basic concepts and principles) :
Definition of Quality, Dimensions of Quality, 
Quality Planning, Quality costs, Basic concepts 
of Total Quality Management, Historical 
Review. Principles of TQM, Leadership – 
Concepts, Quality Council, Quality Statements, 
Strategic Planning, Deming Philosophy, 
Barriers to TQM Implementation. 
 Definition of Quality
• What is quality?
Dictionary has many definitions: “Essential
characteristics,” “Superior,” etc.
• Deming - “non-faulty systems” Quality is a predictable 
degree of uniformity and dependability
• Juran - “fitness for use”
• Crosby - “conformance to requirements”
• Taguchi – Minimum loss imparted by a product to society 
from the time the product is shipped
• Feigenbaum – Way of managing the organization
• Hoshin - correcting and preventing  loss not living with 
loss 3
 Stout’s View
• ISO – Quality is the totality of characteristics 
of an entity that bear on its ability to satisfy 
stated and implied needs
Performance
Quality  = Expectation

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 Dimensions of Quality

• Performance- Primary product characteristics 
• Features- secondary characteristics 
• Reliability- consistency of performance over time
•  Conformance –meeting specifications
• Durability –useful life
•  Serviceability – ease of repair
• Aesthetics – sensory characteristics 
• Response- human-to-human interface
• Reputation- past performance
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Product Selected
Dimensions of Quality
Dimensions of Quality
Dimensions of Quality
Dimensions of Quality
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History of TQM
History of Quality management

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History of Quality management

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History of Quality management

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History of Quality management

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 Historical  Review
• In 1924, Shewart developed a statistical chart for the
control of product variables(SQC).
• In 1931,Shewart gave a clear definition of TQC(Total
quality control), how to measure and control it.
• In 1946, the American Society for quality control was
formed.(ASQ) – promoting the use of quality for all
types of production and service.
• In 1950, Deming,who learned SQC from Shewart,
gave a series of lectures to Japanese engineers and
CEOs.

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 Historical Review

• In 1954, Juran made his first trip to Japan and further

emphasised management’s responsibility to achieve
quality.
• By 1960, Quality control circles were formed for the
purpose of quality improvement.
• During 1970 to 1980, American visited Japan to learn
about the quality miracles.
• In middle 1980s, the concepts of TQM were evolved
and published.

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 Historical Review

• In Late 1980s, the implementation of SPC

started.
• In 1990s, ISO 9000 became the worldwide
model for QMS.
• ISO 14000 followed as a model for EMS.

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 The Quality Hierarchy
Incorporates QA/QC activities
Total Quality into company-wide system
Prevention Management
aimed at satisfying the
SPC customer
Actions to insure products or
Quality Assurance
services conform to company
requirements

Quality Control Operational techniques to make

inspection more efficient and to
Detection SQC reduce the costs of quality.
Inspection
Inspect products

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 Total Quality Management
• Total - made up of the whole
• Quality - degree of excellence a product or
service provides
• Management - act, art or manner of planning,
controlling, directing,….
Therefore, TQM is the art of managing the
whole to achieve excellence.

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 TQM definition

• A management approach of 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
the members of the organization and to
society.
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 Basic concepts of TQM
• A committed and involved management to provide long term top-to-
bottom organizational support : LEADERSHIP

• An unwavering focus on the customer, both internally and externally :

CUSTOMER SATISFACTION

• Effective involvement and utilization of the entire work force :

EMPLOYEE INVOLVEMENT

• Continuous improvement of the business and production process :

CONTINUOUS PROCESS IMPROVEMENT

• Treating suppliers as partners : SUPPLIER PARTNERSHIP

• Establish performance measures for the processes : PERFORMANCE

MEASURES
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Benefits of TQM

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 Obstacles in implementation of 
TQM
• Lack of management commitment
• Inability to change organizational culture
• Improper planning
• Lack of continuous training & education
• Incompatible organizational structure and isolated individuals 
and departments
• Ineffective measurement techniques and lack of access to data 
& results
• Paying inadequate attention to internal & external customers
• Inadequate use of empowerment and teamwork
• Failure to continually improve
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 Principles of TQM
1. A committed and  involved management to provide 
long-term top-to-bottom organizational support.
2. An unwavering focus on  the customer, both 
internally and externally.
3. Effective involvement and utilization of the entire 
workforce.
4. Continuous improvement of the business and 
production process.
5. Treating suppliers as partners.
6. Establish performance measures for the processes.
TQM SYSTEM
Cost of quality 
 Quality costs
• Quality cost are defined as those cost associated with 
the non achievement  of  product and service quality 
as  defined  by  the  requirements  established  by  the 
organization  and  its  contracts  with  customer  and 
society. 
• Simply  stated,  quality  cost  is  the  cost  of  poor 
products or services.
– Cost of quality failure is calculated as a percentage of
profit or annual turnover

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 Examples
• Every time work is redone, the cost of quality 
increases. Obvious example include
v The reworking of a manufactured item
vThe retesting of an assembly
vThe correction of a bank statement
vThe rebuilding of a tool.
Hidden Costs of Poor Quality

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 Why calculate Quality costs?
• Quality Costs represent 15-25% of sales
• Management will give special attention if quality is measured in 
monetary terms
• Quality costing is one of the tools to provide initial assessments 
and hard evidence that improvement is needed or had been made
• To monitor the effectiveness of quality improvement initiatives
• To be used in a generic term by senior management, shareholders 
and financial institutions, so that they can readily understand 
implication of quality in term of money
• Cost of quality failure is calculated as a percentage of profit or 
annual turnover
• It is easy to understand
– By front-line operator
– By middle management
 Categories
• Preventive Costs
• Appraisal Costs
• Internal Failure cost
• External Failure cost

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Cost of Quality
 Preventive Costs
• Costs of activities that are specifically
designed to prevent poor quality.
• No defect occur in any stage such as design,
development, production and delivery of a
product or service
• 10% of total cost
• Elements involved in this category
– Quality planning
– Preventive maintenance
– Training cost
– Vendor appraisal
– Setting up procedures 35
Examples of preventive Cost
 Application screening  Job descriptions
 Capability studies  Market analysis
 Pilot projects
 Controlled storage
 Procedure writing
 Design review  Prototype testing
 Equipment   Procedure reviews
maintenance & repair  Quality incentives
 Field testing  Safety reviews
 Fixture design and   Time and motion studies
fabrication  Survey
 Quality training
 Forecasting
 Vendor evaluation and
 Housekeeping selection
 Personnel reviews
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 Reducing Cost
• Reduction of preventive cost
 1. Preventive activity should have been pre-
planned.
2. Periodically, top management devote time to 
prevent problems from occurring.
 Appraisal Costs
• Costs incurred in the detection of defects.
• Cost incurred in verifying, checking or
evaluating of a product or service at various
stages during manufacturing or delivering
• 40% of total cost
Design review
Code inspection
Training testers
Test automation
Usability testing
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 Examples of appraisal cost
• Audit • Laboratory test
• Document checking • Personnel testing
• Drawing checking • Procedure testing
• Equipment calibration • Prototype inspection
• Final inspection • Receiving inspection
• In-process inspection • Shipping inspection

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 Reducing Cost
Reduction of Appraisal cost

• Inspection is essential before assessing a new 
vendor, a new process or new product.
 Failure Costs
Costs that result from poor quality, such as the cost of
fixing bugs and the cost of dealing with customer
complaints
• Internal Failure Costs: Failure costs that arise before
your company supplies its product or service to the
customer.
ex: cost of scrap, rework and all internal activities
incurred through ‘not getting it right first time’.
• External Failure Costs: Failure costs that arise after
your company supplies the product or service to the
customer.
ex: customer service costs, warranty claims, complaints,
field repair. 41
 Examples of internal failure cost
• Scrap (cost of product that cannot be reworked or reused)
• Scrap disposal (cost of getting rid of product that cannot be 
reworked or reused)
• Rework (costs of correcting quality issues on existing product)
• Rework inspection (cost of inspecting a product after rework)
• Additional material procurement (cost to replace defective or 
missing material)
• Variability in product quality (cost of product give-away and 
mislabeling)
• Downgrading (cost of lower price point of product with quality 
issue)
• Supplier rework (costs attributed to supplier defects)

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 Examples of external failure cost
• Cost of field servicing and handling complaints
• Warranty repairs and replacement costs
• Liability arising from defective products
• Lost sales arising from a reputation of poor 
quality
• Returns and allowances arising from quality 
problems
• Product recalls
• Cost of concessions offered to customers due 
to substandard products
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 Reducing Cost
• Reduction of Failure  cost

    Everything should be done right the first time 
and every time.
Cost of Quality
 Total Cost of Quality
•  Prevention and Appraisal cost-Price of conformance
     Quality  of  conformance  is  the  ability  of  a  product, 
service,  or  process  to  meet  its  design  specifications. 
Design  specifications  are  an  interpretation  of  what  the 
customer needs.
• Internal Failure and External Failure cost-
Price of Non-conformance (Non-fulfillment of 
specified requirements)
• The sum of costs: Prevention + Appraisal + Internal
Failure + External Failure
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 Traditional Model

Total quality costs

Failure costs
unit of product
Cost per good

Cost of appraisal
plus prevention

0% Quality of conformance 100%

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 Emerging COQ Model

Total quality costs

Failure costs
unit of product
Cost per good

Cost of appraisal
plus prevention

0% Quality of conformance 100%

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 Benefits of using quality costing
• Greater accuracy in the evaluation and forecasting of
resource utilization
• Quantify the size of the quality problem.
• Align quality goals with organizational goals.
• Justification for investment in the prevention and
appraisal of failures
• Ability to cost and compare performance across all
departments functions and activities
• Set cost reduction targets

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LEADERSHIP
 Definition
• Daimler Chrysler's CEO :
• Leader -“ ….someone who can take a group of
people to a place they don’t think they can go.”
• Leadership is we, not me; mission, not my
show ; vision, not division; and community, not
domicile
 Definition….
James M.Burns –Book titled “Leadership”
A leader is one who instills purposes, not one who
controls by brute force.
“ Leaders & Followers raise one another to higher
levels of motivation and morality…leadership
becomes moral in that it raises the level of human
conduct and ethical aspiration of both the leader
and the led, and thus has a transforming effect on
both”
 Definition….
Narayana Murthy ( Former chairman INFOSYS)
“A great leader is one who is not only good in creating
vision, creating the big picture, but also ensuring that he
goes into the nitty-gritty, into the details of making sure
that his vision is actually translated into reality through
excellence. In other words, great leaders have great vision,
great imagination, great ideas but they also implement
these ideas through hard work, commitment and flawless
execution. In doing so, they motivate thousands of people”
Characteristics of quality leaders
(12 behaviors)
• Priority to customers - external & internal
• Empower subordinates
• Emphasize improvement rather than
maintenance
• Emphasize prevention
• Encourage collaboration rather than competition
• Train and coach, rather than direct and supervise
• Learn from problems
 Characteristics of quality leaders……
• Try to improve communications
• Demonstrate the commitment to quality
• Choose suppliers on the basis of quality not
price
• Establish organizational systems to
support quality effort
• Encourage and recognize team effort
 7 habits of highly effective people
- Stephen R.Covey
• Be proactive – the ability to choose the response to a
situation
• Begin with end in mind
• Put first things first
• Think win-win
• Seek first to understand, then to be understood
• Synergy
• Sharpen the saw (renewal)
 Role of senior management
Senior management must
–actively participate in the implementation process and the
Quality Council
–practice the philosophy of management by wandering about - to
get out of the office and visit customers, departments and plants
within the organization, and suppliers and talk to people
–stay informed on the topic of quality improvement
–find time to celebrate the success of their organization's quality
effort - award and recognition ceremonies
–Actively and visibly engaged in the quality effort by coaching
teams and teaching seminars
 Role of senior management ……
– listen to internal and external customers and suppliers
and translate this information into core values and
process improvement projects
– communicate to create awareness of the importance of
TQM and provide TQM results in an ongoing manner,
i.e., newsletters, posters, TQM bulletin boards,
departmental information meetings, memos and
organization-wide meetings
– Promote external communication activities with
customers and suppliers, the media, advertising in trade
magazines and interaction with the quality community
– Change the culture
 Ten strategies for top management
Proactive management
Adventurous & bold change management
Do It Right First Time (DIRFT)
Continuous preventive action
Care for little things and accumulate gains
Ensure economic performance
Practice management by walking around
Measure success
Never rest on laurels, continue to improve
Build a virtual organization
 The Deming philosophy
-14 points for management
1. Create and publish to all employees a statement of the
aims and purposes of the company. The management
must demonstrate their commitment to this statement.
2. Learn the new philosophy.
3. Understand the purpose of inspection –to reduce the
cost and improve the processes.
4. End the practice of awarding business on the basis of
price tag alone.
5. Improve constantly and forever the system of
production and service.
 The Deming philosophy
6. Institute training
7. Teach and institute leadership.
8. Drive out fear. Create an environment of innovation.
9. Optimize the team efforts towards the aims and purposes
of the company.
10. Eliminate exhortations for the workforce.
11. Eliminate numerical quotas for production.
12. Remove the barriers that rob pride of workmanship.
13. Encourage learning and self-improvement.
14. Take action to accomplish the transformation.
 Quality council
Driver for TQM engine.
CEOs, senior managers of the functional areas such
as design, marketing, finance, production & quality
and a co-ordinator or a consultant. Representation
from union.
The individual selected for the co-ordinator’s
position should be a bright young person with
executive potential.
 Duties of the quality council….
1. Develop core values, vision statement, mission and quality
policy statement
2. Develop the strategic long-term plan with goals
3. Create the total education and training plan
4. Determine and continually monitor COQ
5. Determine performance measures and monitor them
6. Continually determine those projects that improve the
processes
7. Establish multifunctional project – work teams and monitor
their progress
8. Establish or revise the recognition and reward system
 Agenda for quality council meeting

Progress report on teams

Customer satisfaction report
Progress on meeting goals
New project teams
Recognition dinner
Benchmarking report
 Core values, concepts & framework
Based on Malcolm Baldrige National Quality Award:
• Visionary leadership
• Customer driven excellence
• Organizational & personal learning
• Valuing employees & partners
• Agility
• Focus on the future
• Managing for innovation
• Management by fact
• Public responsibility & citizenship
• Focus on results and creating value
• Systems perspective
 Quality Statement
Vision Statement • Vision Statement of KEC
–A declaration of what an – To be a centre of excellence for
organization should look like five to development and dissemination
ten years in the future. of knowledge in Applied
science,technology, engineering
–It is a realistic picture of what it & management for the nation &
wants to become and what is possible. beyond.
Mission Statement • Mission Statement of KEC
– Answers the questions of who we – We are committed to value based
are, who are the customers, what education, research &
we do and how we do it. consultancy in Engineering &
Management and to bring out
– Provides a clear statement of technically competent, ethically
purpose for employees, customers strong and quality professionals
and suppliers. to keep our Nation ahead in the
competitive knowledge
intensive world.
 BMW Vision & Mission
Vision
The fact that we are in business since 1956 and are family-owned is the
cornerstone of who we are and why we are different from the competition.
"We Treat You Like F.A.M.I.L.Y."
Family Treatment
Attitude is Key
More than the Customer Expects
Individual Attention with Enthusiasm
Like an Honored Guest
You make the Difference
Mission Statement
We will provide our clients with the best customer treatment experience. We will
under-promise and over-deliver in all we do. We will sell and service our products
with the highest quality and integrity. We recognize that the greatest asset in
achieving our Mission is the individual effort of each employee.
All of our staff will be indoctrinated with our vision. Further, they will be asked to
define, and therefore to understand, what their role in the accomplishment of that
mission is. Their own definition, from a customer's point of view, can then be
applied in their own personal job description on a daily basis.
 Quality Statement ….
Quality Policy Statement
• A guide for everyone in the organization as to how they should provide
products and service to the customers.
• Written by the CEO with feedback from the workforce and approved by the
Quality Council
Some examples
–Quality Policy Statement
• ABC is committed to a continuous improvement approach to provide
quality services to our customers, with an ultimate goal to better satisfy
their needs and expectations. All staff of the ABC will strive to conform to
this Quality Policy.
• ABC is committed to the provision of quality services to our customers.
The objective of ABC is continuous improvement in our services to strive
for sustained quality excellence, and to better satisfy the needs and
expectations of our customers.
Common characteristics for 
quality policy

Quality is first among equals

Meet the needs of the internal & external
customers
Equal or exceed competition
Continually improve the quality
Include business and production practices
Utilize the entire work force
Strategic planning
 Goals & objectives
Goals Objectives
• Long- term planning • Short term- planning
• Need a concrete focus • They are operational
• Based on statistical evidence • approaches to attain the goals
• Definitive, specific and
understandable
• Measurable
• To achieve goals, resources &
time should be provided.
• Goals must be challenging yet
achievable
Seven steps to strategic planning
 References
Besterfield Dale H. et al, “Total Quality Management”,
Third edition, Pearson Education, 2011.
Subburaj Ramasamy, “Total Quality Management”,
Tata McGraw Hill, New Delhi, 2012.
Evans James R. and Lindsay William M., “The
Management and Control of Quality”, eighth Edition,
South-Western (Thomson Learning), 2012.
https://www.iso.org/home.html