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Chapter 6 -Chapter 6 -
Total Quality Total Quality ManagementManagement
TQM WheelTQM Wheel
Customer satisfaction
TQM emphasizes three main principles: customer satisfaction, employee involvement, and continuous improvement.
Total Quality Management
Total quality management is defined as managing the entire organization so that it excels on all dimensions of products and services that are important to the customer.
Factors that can impede TQM: Managers are frequently evaluated, rewarded, and
promoted on basis of short-term financial performance
Decisions that are made to generate short-term gains can overpower TQM commitments
Customer-DrivenCustomer-DrivenDefinitions of QualityDefinitions of Quality
Conformance to SpecificationsConformance to Specifications ValueValue Fitness for UseFitness for Use SupportSupport Psychological ImpressionsPsychological Impressions
Relate each dimension to products and services
The Costs of Poor QualityThe Costs of Poor Quality
Prevention CostsPrevention Costs Appraisal CostsAppraisal Costs Internal Failure CostsInternal Failure Costs External Failure CostsExternal Failure Costs
Costs of Detecting DefectsCosts of Detecting Defects
Process Final testing CustomerWhere defect is detected
Co
st
of
de
tec
tio
n a
nd
co
rre
cti
on
Employee InvolvementEmployee Involvement
Cultural ChangeCultural Change TeamsTeams Individual DevelopmentIndividual Development Awards and IncentivesAwards and Incentives
PlanPlan
DoDo
CheckCheck
ActAct
Deming WheelDeming Wheel1. Plan a change
aimed at improvement.
2. Execute the change.
3. Study the results; did it work?
4. Institutionalize the change or abandon or do it again.
ReliabilityReliability
Product reliabilityProduct reliability
rrss = (= (rr11)()(rr22) . . . () . . . (rrnn))
wherewhere
rrss = = reliability of the reliability of the
complete productcomplete product
nn = = number of subsystemsnumber of subsystems
rrnn = = reliability of the reliability of the
subsystem or component subsystem or component nn
ReliabilityReliability
Product reliabilityProduct reliability
rrss = (= (rr11)()(rr22) . . . () . . . (rrnn))
wherewhere
rrss = = reliability of the reliability of the
complete productcomplete product
nn = = number of subsystemsnumber of subsystems
rrnn = = reliability of the reliability of the
subsystem or component subsystem or component nnrrss = (0.99)(0.90)(0.85) = 0.76 = (0.99)(0.90)(0.85) = 0.76
BenchmarkingBenchmarking
PlanningPlanning AnalysisAnalysis IntegrationIntegration ActionAction
Benchmarking
1. Identify those processes needing improvement.
2. Identify a firm that is the world leader in performing the process.
3. Contact the managers of that company and make a personal visit to interview managers and workers.
4. Analyze data.
Tools for Improving QualityTools for Improving Quality
Step 1—ChecklistStep 1—Checklist Step 2—Pareto chartStep 2—Pareto chart Step 3—Cause-and-effect diagramStep 3—Cause-and-effect diagram Step 4—Bar chart and HistogramsStep 4—Bar chart and Histograms
Bar Chart and Histogram - Can be used to identify the frequency of quality defect occurrences and display quality performance.
Bar Chart and Histogram - Can be used to identify the frequency of quality defect occurrences and display quality performance.
Cause and Effect Diagram - Can be used to systematically track backwards to find a possible cause of a quality problem (or effect).
Cause and Effect Diagram - Can be used to systematically track backwards to find a possible cause of a quality problem (or effect).
Pareto ChartsPareto Charts
Can be used to find when 80% of the problems may be attributed to 20% of thecauses.
Can be used to find when 80% of the problems may be attributed to 20% of thecauses.
Cause-and-Effect DiagramsCause-and-Effect Diagrams
EffectEffect
PersonnelPersonnelMachinesMachines
ProcessProcessMaterialsMaterials
Checker Board AirlinesChecker Board Airlines
Passenger processing at gate
Late cabin cleaners
Unavailable cockpit crew
Late cabin crew
Personnel
Weather
Air traffic delays
Other
Aircraft late to gate
Mechanical failures
Equipment
Materials Procedures
Waiting for late passengers
Weight/balance sheet late
Poor announcement of departures
Delayed check-in procedure
Delayed flight departures
Late food service
Late fuel
Late baggage to aircraft
Contractor not provided updated schedule
Figure 6.6Source: Adapted from D. Daryl Wyckoff, “New Tools for Achieving Service Quality.” The Cornell Hotel and Restaurant Administration Quarterly, November 1984, pg. 89. © 1984 Cornell H.R.A. Quarterly. Used by permission. All rights reserved.
Wellington Fiber Board Co.Wellington Fiber Board Co.
ChecklistsChecklists
Headliner Defects
Defect type Tally Total
A. Tears in fabric //// 4
B. Discolored fabric /// 3
C. Broken fiber board //// //// //// //////// //// //// / 36
D. Ragged edges //// // 7
Total 50
Can be used to keep track of defects or used to make sure people collect data in a correct manner.
Can be used to keep track of defects or used to make sure people collect data in a correct manner.
ISO 9000
Series of standards agreed upon by the International Organization for Standardization (ISO)
Adopted in 1987
More than 100 countries
A prerequisite for global competition?
ISO 9000 directs you to "document what you do and then do as you documented."
ISO 9000 vs. Baldrige Award
The Baldrige AwardU.S. national quality awardhighlights performance of firms that have
attained excellence in quality managementISO 9000 Certification
series of standardsprovides market access
ISO 14000standards for environmental management
Leadership—Leadership—Leadership system, values, expectations, and public responsibilities (second highest percentage of points)
Strategic Planning—Strategic Planning—The effectiveness of strategic and business planning and deployment of plans, focusing on performance requirements
Customer and Market Focus—Customer and Market Focus—How the company determines customer and market requirements and achieves customers satisfaction
Information and Analysis—Information and Analysis—The effectiveness of information systems to support customer driven performance excellence and marketplace success
Human Resource Focus—Human Resource Focus—The success of efforts to realize the full potential of the work force to create a high-performance organization
Process Management—Process Management—The effectiveness of systems and processes for assuring the quality of products and services
Business Results—Business Results—Performance results and competitive benchmarking in customer satisfaction, financials, human resources, suppliers, and operations (Highest percentage of points)
Criteria for Performance Criteria for Performance ExcellenceExcellence