Quality Management

TQM, Six Sigma, ISO

Quality

• Quality is concerned with quality assurance and process improvement in manufacturing and service sectors (including the public sector).

• the use of sound measurement methods, statistical analysis and process improvement techniques to significantly improve quality on the shop floor and in manufacturing and service (etc) planning.

Quality management

• Quality management is concerned with compliance with quality standards, certification and compliance

Total Quality Management - TQM

• popular "quality management" concept.

• assuring product or service quality.

• business philosophy - a way of doing business.

• describes ways to managing people and business processes to ensure complete customer satisfaction at every stage.

• often associated with the phrase - "doing the right things right, first time".

Main features of TQM:

• views “quality” entirely from the point of view of “the customer”.

• All businesses have many types of customer.

• customer can be someone "internal" to the business (e.g. a production employee working at the end of the production line is the "customer" of the employees involved earlier in the production process).

Customers...

• customer can also be “external to the business”.

• ‘normal’ customers.

• When you fly with an airline you are their customer.

• When Tesco's buys products from food manufacturers, it is a customer.

• TQM recognises that all businesses require "processes" that enable customer requirements to be met.

TQM focus...

• TQM focuses on the ways in which these processes can be managed - with two key objectives:

• 1 100% customer satisfaction

• 2 Zero defects

Importance of Customer - Supplier Relationships -

‘Quality Chains’• TQM focuses on importance of relationship between

customers (internal and external) and supplier. • These are "quality chains” which can be broken at

any point by one person or one piece of equipment not meeting the requirements of the customer.

• Failure to meet requirements in any part of quality chain multiplies, and failure in one part of system creates problems elsewhere, leading to yet more failure and problems, and so the situation is exacerbated.

Customers

• ability to meet customers’ (external and internal) requirements is vital.

• To achieve quality throughout organisation, every person in quality chain needs training to ask following questions about every customer-supplier chain:

• Customers• Who are my customers?• What are their real needs and expectations?• How can I measure my ability to meet their needs and expectations?

Questions...

• Do I have the capability to meet their needs and expectations? (If not, what must I do to improve this capability?)

• Do I continually meet their needs and expectations? (If not, what prevents this from happening when the capability exists?)

• How do I monitor changes in their needs and expectations?

Suppliers:

• Who are my internal suppliers?• What are my true needs and expectations?• How do I communicate my needs and

expectations to my suppliers?• Do my suppliers have the capability to

measure and meet these needs and expectations?

• How do I inform them of changes in my needs and expectations?

Main Principles of TQM

• The main principles underlying TQM are summarised below:

• Prevention Prevention is better than cure. In the long run, it is cheaper to stop products defects than trying to find them

• Zero defectsThe ultimate aim is no (zero) defects - or exceptionally low defect levels if a product or service is complicated

• Getting things right first time Better not to produce at all than produce something defective

Quality/CI/Involvement

• Quality involves everyone Quality not just concern of production or operations department - involves everyone, including marketing, finance and human resources

• Continuous improvement Businesses always looking for ways to improve processes to help quality

• Employee involvement Those in production and operations have vital role to play in spotting improvement opportunities for quality and identifying quality problems

Introducing TQM into a Business

• TQM not an easy concept to introduce into businesses - particularly those not traditionally concerned with understanding customer needs and business processes.

• In fact - many attempts to introduce TQM fail!

• One of reasons for challenge of introducing TQM is that it has significant implications for the whole business.

Involvement, but...

• For example, it requires that management give employees a say in the production processes that they are involved in.

• In a culture of continuous improvement, workforce views are invaluable.

• The problem is - many businesses have barriers to involvement.

• For example, middle managers may feel that their authority is being challenged.

Empowerment

• So "empowerment" is a crucial part of TQM.

• The key to success is to identify the management culture before attempting to install TQM and to take steps to change to the new required management style.

• Since culture is not the first thing that managers think about, this step has often been missed or ignored with resultant failure of a TQM strategy.

TQM focus...

• TQM also focuses the business on the activities of the business that are closest to the customer - e.g. the production department, the employees facing the customer.

• This can cause resentment amongst departments that previously considered themselves ‘above’ the shop floor.

ASQ...

• The American Society for Quality (ASQ) is an association for quality professionals.

• The organization focuses on customer satisfaction, root cause analysis and continual improvement

• The organization teaches the importance of stable top management support to drive continual improvement

• They are pushing Six Sigma and ISO 9000

ASQ...

• ASQ membership steeply rose from 1984 to 1995.

• during the Total Quality Management (TQM) movement.

• Times have changed, and the TQM movement probably does not fit anymore,

• but the ideas generated by the quality visionaries are timeless

ASQ focus...

• ASQ has a manufacturing focus

• It has developed programs to deploy quality in the healthcare industry with great success.

• Other areas such as engineering, project management, marketing and customer support offer opportunities for ASQ

ISO 9000

• ISO 9000 is the international standard for quality management,

• It is becoming a worldwide standard.

• December 2001: there were more than 510,616 businesses certified in 161 countries.

• The 10 industrialized nations accounted for nearly 62% of that total

ISO 9000 certification

• Certification/registration takes place when an independent and competent body certifies that a product, process, service or system conforms to specific requirements.

• With ISO 9000, registration and certification are used interchangeably, and bodies that issue conformity certificates are referred to as registrars in the USA, and elsewhere as certification or registration bodies.

ISO 9000 registration

• Since the registrar is independent of both the organization seeking certification (the first party) and its customers (second parties),

• the registration process is known as third-party assessment,

• and its value is based on the proven competence of the registrar.

Known brands...

• multinational organizations normally prefer known brand names such as Bureau Veritas (France), Lloyd's Register (UK), SGS (Switzerland), T¿ (Germany) or American National Standards Institute (United States)

• smaller companies may prefer local registrar, able to provide a more personalized service.

• organizations shopping for a registrar should consider the following factors:

Factors in choosing a registrar

• Price. Some registrars base their rates on the organization size while others may charge a daily rate.

• Location. Registrar located close to the organization preferred to a distant registrar.

• Compatibility. Is registrar familiar with nature of organization's business and comfortable with its culture?

Prior to Audit

• prior to an on-site audit:

• a review of the company's quality manual to see whether it meets requirements.

• Organisations need to ensure any issues raised by the auditor are addressed by either changing procedures or documents

• Preassessment. Organisation pays for practice audit. Registrar can be directed to areas that the company wants covered to address potential weak points.

European and US documentation

• European documentation procedures tend to be more elaborate, so organisations spend more, on average, on ISO 9000 implementation than American companies.

• Approx 3 times more…?

• For many years, the Japanese evinced little interest in ISO 9000 registration, preferring the total quality management (TQM) approach with a focus on continuous improvement.

Revised ISO 9000

• ISO's revised ISO 9000: 2000 incorporated TQM principles and is changing the thinking process.

• Intended to be applicable to all organizations, regardless of type, size or product category.

• Is a move from conformance thinking to performance thinking.

• Old standard: presence of 20 elements was evaluated; now it must be determined whether the processes are effective.

ISO and Deming

• It has been recommended that companies use Dr. W. Edwards Deming's built-in "plan-do-check-act" cycle in the procedure

• to establish a plan and then take corrective measures when quality results such as warranty costs or defects exceed set objectives.

• Thus, the standard is moving organizations toward Japanese-style continuous improvement.

Measuring customer satisfaction

• Another requirement is measuring customer satisfaction.

• Most US companies developing questionnaires to assess whether customers are satisfied with products and services.

• European registrars are wary of paperwork created by questionnaires, and some prefer instead to develop a set of indices to measure customer satisfaction.

Objective evidence

• "I just need objective evidence that customers have processes for assessing customer satisfaction, even if it means that they just record telephone calls made to customers,” Cwiekowski, Great Western Registrar LLC (Phoenix)

• 90% of registered companies indicated they would make the transition to ISO 9001: 2000 before the December 2003 deadline.

Malcolm Baldrige National Quality Award

• the Baldrige Program has produced a widespread positive impact on the quality performance of U.S. companies.

• The quality literature-- for example, J.M. Juran -- feel that the criteria used for judging the Baldrige competition have become the leading model defining the concepts of continuous improvement and total quality management (TQM).

Baldrige criteria

• the Baldrige criteria are widely used by companies nationwide to conduct self-audits, and to develop and guide their own TQM policies,

• whether they enter the competition or not.

• Been nearly two million requests for Baldrige application forms and criteria.

Successful companies’ tactics

• With a focused, rapid deployment of a Six Sigma plan, a major (US) financial services company was able to save $75 million in productivity benefits, reduce customer complaints by 29% and increase stock value by 52%.

Leading companies...

• Leading companies establish internal quality awards to promote the benchmarking function.

• For example, one company honours an employee annually with its Quality Award.

• Recipients receive a celebration within their organization.

Top companies

• Top companies divide benchmarking data according to audience.

• For example, a leading telecom equipment manufacturer separates benchmarking information into administrative and technical categories.

• The administrative information is then posted on internal electronic message boards, whereas the technical information is more specifically targeted to key stakeholders.

The quality journey...

• The great leaders of the quality revolution of the 1980s focused on improving the competitiveness of American organizations and did all they could to spread the word.

• Many companies start a quality journey by latching onto a quality trend.

• Such as TQM…

Quality trends, circles, ISO, ...

• Quality trends: part of US business culture.

• But...

• Quality circles, total quality management (TQM),

• ISO, QS, Baldrige and now Six Sigma,

• have all had their day as the quality solution.

• Employees are tired of this year’s solution.

• Quality programs constantly change.

Difficult...

• Difficult to develop quality system that can show significant results—and without significant results, management loses support from employees.

• This is the case with Six Sigma, as with all previous repackaged quality programs

Quality-improvement methods and techniques

• There are tried-and-true quality-improvement methods and techniques

• Companies need to make them a part of the company’s culture and stay focused on the tasks that lead to a healthier business, not the certificate on the wall or the colour of the belt.

Taguchi: the Loss Function.

• Quality is the gap between how good something is and how good it possibly could be,

• and we should continually focus on narrowing that gap.

• the state of the quality profession: is there a gap between what quality professionals are contributing and what they could be contributing to their organizations ?

Quality gap...

• focus of quality movement shifted away from the great quality visionaries.

• in their place is inappropriate level of attention to things such as ISO

• -- marketing driven, time consuming standard doing poor job assuring that companies meet a relatively low quality hurdle.

• Has quality profession evolved from being change agents to compliance officers?

Any QuestionsTaken from:

‘Quality Initiatives Increase Savings’, Quality Magazine:http://www.qualitymag.com/CDA/ArticleInformation/news/news_item/0,6407,119529,00.html

‘About Quality’, Quality Magazine:http://www.qualitymag.com/FILES/HTML/QTY_about_us/1,6446,,00.html

‘Probing the Limits: Could Deming Have Been Wrong?’ , Quality Magazine :http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,102404,00+en-uss_01dbc.html

‘Six Sigma? No Thanks’, Quality Magazine:: http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,99484,00+en-uss_01dbc.html

‘Probing the Limits: Wake Up ASQ!’, Quality Magazine:: http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,105764,00+en-uss_01dbc.html

‘ISO 9000 for a Small Planet’, http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,98551,00+en-uss_01dbc.html

‘No Respect’, Quality Magazine :http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,99000,00+en-uss_01dbc.html

‘Still Passionate for Quality?’, Quality Magazine :http://www.qualitymag.com/qty/cda/articleinformation/features/bnp__features__item/0,,98570,00+en-uss_01dbc.html

tutur2u: total quality management -tqmhttp://www.tutor2u.net/business/production/quality_tqm.htm