Unit 1

Principles and Practices

Total Quality Management (TQM) is an enhancement to the traditional way of doing business. It is a
proven technique to guarantee survival in world-class competition. Only by changing the actions of
management will the culture and actions of an entire organization be transformed. TQM is for the most
part common sense. Analyzing the three words, we have
Total—Made up of the whole.
Quality—Degree of excellence a product or service provides.
Management—Act, art, or manner of handling, controlling, directing, etc.
Therefore, TQM is the art of managing the whole to achieve excellence. The Golden Rule is a simple
but effective way to explain it: Do unto others as you would have them do unto you.
TQM is defined as both a philosophy and a set of guiding principles that represent the foundation of a
continuously improving organization.

Basic Approach
TQM requires six basic concepts:
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 work force.
4. Continuous improvement of the business and production process.
5. Treating suppliers as partners.
6. Establish performance measures for the processes.
1. Management must participate in the quality program. A quality council must be established to develop
a clear vision, set long-term goals, and direct the program. Quality goals are included in the business
plan. An annual quality improvement program is established and involves input from the entire work
force. Managers participate on quality improvement teams and also act as coaches to other teams.
2. The key to an effective TQM program is its focus on the customer. An excellent place to start is by
satisfying internal customers. We must listen to the “voice of the customer” and emphasize design
quality and defect prevention. Do it right the first time and every time, for customer satisfaction is the
most important consideration.
3. TQM is an organization-wide challenge that is everyone’s responsibility. All personnel must be
trained in TQM, statistical process control (SPC), and other appropriate quality improvement skills so
they can effectively participate on project teams. Including internal customers and, for that matter,
internal suppliers on project teams is an excellent approach.
4. There must be a continual striving to improve all business and production processes. Quality
improvement projects, such as on-time delivery, order entry efficiency, billing error rate, customer
satisfaction, cycle time, scrap reduction, and supplier management, are good places to begin.
5. On the average 40% of the sales dollar is purchased product or service; therefore, the supplier quality
must be outstanding. A partnering relationship rather than an adversarial one must be developed. Both
parties have as much to gain or lose based on the success or failure of the product or service. The focus
should be on quality and life-cycle costs rather than price. Suppliers should be few in number so that
true partnering can occur.
6. Performance measures such as uptime, percent nonconforming, absenteeism, and customer
satisfaction should be determined for each functional area. These measures should be posted for
everyone to see. Quantitative data are necessary to measure the continuous quality improvement
activity.

Gurus of Total Quality Management

Shewhart
Walter A. Shewhart, PhD, spent his professional career at Western Electric and Bell Telephone
Laboratories, both divisions of AT&T. He developed control chart theory with control limits, assignable
and chance causes of variation, and rational subgroups. In 1931, he authored Economic Control of
Quality of Manufactured Product, which is regarded as a complete and thorough work of the basic
principles of quality control. He also developed the PDSA cycle for learning and improvement.
Ronald Fisher
In the conventional sense, Fisher is not known as a quality guru. However, he created a solid foundation
of statistical methods, such as design of experiments (DOE) and analysis of variance (ANOVA) in the
1930s. DOE is one of the most powerful tools used by many organizations in problem solving and
process improvements. Analysis of variance became widely known after being included in his book
Statistical Methods for Research Workers in 1925. Fisher also published The Design of Experiments in
1935 and Statistical Tables in 1947.
Deming
W. Edwards Deming, PhD, was a protégé of Shewhart. In 1950, he taught statistical process control and
the importance of quality to the leading CEOs of Japanese industry. He is credited with providing the
foundation for the Japanese quality miracle and resurgence as an economic power. Deming is the best-
known quality expert in the world. His 14 points provide a theory for management to improve quality,
productivity, and competitive position. He has authored a number of books including Out of the Crisis
and Quality, Productivity, and Competitive Position as well as 161 scholarly studies.
Juran
Joseph M. Juran, PhD worked at Western Electric from 1924 to 1941. There he was exposed to the
concepts of Shewhart. Juran traveled to Japan in 1954 to teach quality management. He emphasized the
necessity for management at all levels to be committed to the quality effort with hands-on involvement.
He recommended project improvements based on return on investment to achieve breakthrough results.
The Juran Trilogy for managing quality is carried out by the three interrelated processes of planning,
control, and improvement. In 1951, the first edition of Juran’s Quality Control Handbook was
published.
Feigenbaum
Armand V. Feigenbaum, PhD, argues that total quality control2 is necessary to achieve productivity,
market penetration, and competitive advantage. Quality begins by identifying the customer’s
requirements and ends with a product or service in the hands of a satisfied customer. In addition to
customer satisfaction, some of Feigenbaum’s quality principles are genuine management involvement,
employee involvement, first-line supervision leadership, and company-wide quality control. In 1951,
he authored Total Quality Control.
Ishikawa
Kaoru Ishikawa, PhD, studied under Deming, Juran, and Feigenbaum. He borrowed the total quality
control concept and adapted it for the Japanese. In addition, he authored SPC texts in Japanese and in
English. Ishikawa is best known for the development of the cause and effect diagram, which is
sometimes called an Ishikawa diagram. He developed the quality circle concept in Japan, whereby work
groups, including their supervisor, were trained in SPC concepts. The groups then met to identify and
solve quality problems in their work environment.
Crosby
Phillip B. Crosby authored his first book, Quality is Free, in 1979, which was translated into 15
languages. It sold 1.5 million copies and changed the way management looked at quality. He argued
that “doing it right the first time” is less expensive than the costs of detecting and correcting
nonconformities. In 1984, he authored Quality Without Tears, which contained his four absolutes of
quality management. These absolutes are: quality is conformance to requirements, prevention of
nonconformance is the objective not appraisal, the performance standard is zero defects not “that’s close
enough,” and the measurement of quality is the cost of nonconformance.

Taguchi
Genichi Taguchi, PhD, developed his loss function concept that combines cost, target, and variation
into one metric. Because the loss function is reactive, he developed the signal to noise ratio as a
proactive equivalent. The cornerstone of Taguchi’s philosophy is the robust design of parameters and
tolerances. It is built on the simplification and use of traditional design of experiments.

TQM Framework
Figure 1 shows the framework for the TQM system. It begins with the knowledge provided by gurus of
quality: Shewhart, Deming, Juran, Feigenbaum, Ishikawa, Crosby, and Taguchi. As the figure shows,
they contributed to the development of principles and practices and/or the tools and techniques. Some
of these tools and techniques are used in the product and/or service realization activity. Feedback from
internal/external customers or interested parties provides information to continually improve the
organization’s system, product and/or service.
Fig 1

Awareness
An organization will not begin the transformation to TQM until it is aware that the quality of the product
or service must be improved. Awareness comes about when an organization loses market share or
realizes that quality and productivity go hand-in-hand.

 Automation and other productivity enhancements might not help a corporation if it is unable to
market its product or service because the quality is poor.
 Until recently, corporations have not recognized the importance of quality. However, a new
attitude has emerged—quality first among the equals of cost and service. The customer wants
value. Quality and productivity are not mutually exclusive.
 Improvements in quality can lead directly to increased productivity and other benefits. As seen
in the table, the improved quality results in a 5.6% improvement in productivity, capacity, and
profit.
 Many quality improvement projects are achieved with the same work force, same overhead,
and no investment in new equipment. Recent evidence shows that more and more corporations
are recognizing the importance and necessity of quality improvement if they are to survive
domestic and world-wide competition.
 Quality improvement is not limited to the conformance of the product or service to
specifications; it also involves the inherent quality in the design of the system. The prevention
of product, service, and process problems is a more desirable objective than taking corrective
action after the product is manufactured or a service rendered.
Defining Quality
It is defined as the degree to which a set of inherent characteristics fulfills requirements. Degree
means that quality can be used with adjectives such as poor, good, and excellent. Inherent is defined
as existing in something, especially as a permanent characteristic. Characteristics can be
quantitative or qualitative. Requirement is a need or expectation that is stated; generally implied by
the organization, its customers, and other interested parties; or obligatory.
The Dimensions of Quality

 Performance
Does the product or service do what it is supposed to do, within its defined tolerances? Performance
is often a source of contention between customers and suppliers, particularly when deliverables are
not adequately defined within specifications. The performance of a product often influences the
profitability or reputation of the end-user. As such, many contracts or specifications include
damages related to inadequate performance.

 Features
Does the product or services possess all of the features specified, or required for its intended
purpose? While this dimension may seem obvious, performance specifications rarely define the
features required in a product. Thus, it’s important that suppliers designing products or services
from performance specifications are familiar with their intended uses, and maintain close
relationships with the end-users.

 Reliability
Will the product consistently perform within specifications? Reliability may be closely related to
performance. For instance, a product specification may define parameters for up-time or acceptable
failure rates. Reliability is a major contributor to brand or company image and is considered a
fundamental dimension of quality by most end-users.

 Conformance
Does the product or service conform to the specification? If it’s developed based on a performance
specification, does it perform as specified? If it’s developed based on a design specification, does
it possess all of the features defined?

 Durability
How long will the product perform or last, and under what conditions? Durability is closely related
to warranty. Requirements for product durability are often included within procurement contracts
and specifications. For instance, fighter aircraft procured to operate from aircraft carriers include
design criteria intended to improve their durability in the demanding naval environment.

 Serviceability
Is the product relatively easy to maintain and repair? As end users become more focused on the
Total Cost of Ownership than simple procurement costs, serviceability (as well as reliability) is
becoming an increasingly important dimension of quality and criteria for product selection.

 Aesthetics
The way a product looks is important to end-users. The aesthetic properties of a product contribute
to a company’s or brand’s identity. Faults or defects in a product that diminish its aesthetic
properties, even those that do not reduce or alter other dimensions of quality, are often causes for
rejection.

 Perception
Perception is reality. The product or service may possess adequate or even superior dimensions of
quality but still fall victim to negative customer or public perceptions.

HISTORY OF TOTAL QUALITY MANAGEMENT

 1920s
Some of the first seeds of quality management were planted as the principles of scientific
management swept through U.S. industry.
The Hawthorne experiments in the late 1920s showed how worker productivity could be impacted
by participation.

 1930s
Walter Shewhart developed the methods for statistical analysis and control of quality.

 1950s
W. Edwards Deming taught methods for statistical analysis and control of quality to Japanese
engineers and executives. This can be considered the origin of TQM.
Joseph M. Juran taught the concepts of controlling quality and managerial breakthrough.
Armand V. Feigenbaum’s book Total Quality Control, a forerunner for the present understanding
of TQM, was published.
Philip B. Crosby’s promotion of zero defects paved the way for quality improvement in many
companies.

 1968
The Japanese named their approach to total quality "companywide quality control." It is around this
time that the term quality management systems arises.
Kaoru Ishikawa’s synthesis of the philosophy contributed to Japan’s ascendancy as a quality leader.

BENEFITS OF TOTAL QUALITY MANAGEMENT

 Strengthened competitive position
 Adaptability to changing or emerging market conditions and to environmental and other
government regulations
 Higher productivity
 Enhanced market image
 Elimination of defects and waste
 Reduced costs and better cost management
 Higher profitability
 Improved customer focus and satisfaction
 Increased customer loyalty and retention
 Increased job security
 Improved employee morale
 Enhanced shareholder and stakeholder value
 Improved and innovative processes

OBSTACLES OF TQM
Once an organization embarks on TQM, there will be obstacles to its successful implementation.

 Lack of Management Commitment

In order for any organizational effort to succeed, there must be a substantial management
commitment of management time and organizational resources. The purpose must be clearly and
continuously communicated to all personnel. Management must consistently apply the principles
of TQM.

 Inability to Change Organizational Culture

Changing an organization’s culture is difficult and will require as much as five years. Individuals
resist change—they become accustomed to doing a particular process and it becomes the preferred
way. Management must understand and utilize the basic concepts of change. They are:
1. People change when they want to and to meet their own needs.