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Date: 11-03-2011
ASSIGNMENT: TOTOAL QUALITY MANAGEMENT
Topic:
5 QUALITY GURU’S AND THEIR CONTRIBUTION. QUALITY POLICY, REASONS FOR SUCCESS, SCOPE OF IMPROVEMENT AND
SUGGESTIONS OF HDFC BANK.
Submitted by:
Mohammed Shareef M.K
Roll No: 082600192
Section A
3rd year BBM (e-banking &finance)
INTRODUCTION
Total quality management is considered as a management approach that
was first used during the 1950’s and has become popular during the early of
1980’s. Total quality is considered as a total description of the culture, attitude as
well as the organization of the company that is in focus of providing their
customers with their products or services that will meet the demands and
preferences of their customers. Furthermore, the culture requires quality in all
aspects of the company’s operations, with the different processes that are being
done right the first time and defects as well as the waste eradicated from the
different operations.
TQM is a method that is used where in the management as well as the
employees are all involved in their continuous improvement of the production of
goods as well as services. It can also be considered as the combination of quality as
well as the different management tools that focus at the increasing the growth of
the business as well as reducing the losses that was caused by different
unimportant or useless practices
FIVE QUALITY GURU’S:
Philip Crosby – “Zero Defects” and “Right
First Time”
Philip Crosby is an American who promoted the phrases “zero defects” and “right
first time”. “Zero defects” doesn’t mean mistakes never happen, rather that there is
no allowable number of errors built into a product or process and that you get it
right first time.
Philip Crosby believes management should take prime responsibility for quality,
and workers only follow their managers’ example. He defined the Four Absolutes
of Quality Management.
The Four Absolutes of Quality Management
1. Quality is conformance to requirements
2. Quality prevention is preferable to quality inspection
3. Zero defects is the quality performance standard
4. Quality is measured in monetary terms – the price of non-conformance.
Crosby's 14 Steps to Quality Improvement
1. Management is committed to quality – and this is clear to all
2. Create quality improvement teams – with (senior) representatives from all
departments.
3. Measure processes to determine current and potential quality issues.
4. Calculate the cost of (poor) quality
5. Raise quality awareness of all employees
6. Take action to correct quality issues
7. Monitor progress of quality improvement – establish a zero defects
committee.
8. Train supervisors in quality improvement
9. Hold “zero defects” days
10.Encourage employees to create their own quality improvement goals
11.Encourage employee communication with management about obstacles to
quality
12.Recognize participants’ effort
13.Create quality councils
14.Do it all over again – quality improvement does not end
Five characteristics of an “Eternally Successful Organization”
1. People routinely do things right first time
2. Change is anticipated and used to advantage
3. Growth is consistent and profitable
4. New products and services appear when needed
5. Everyone is happy to work there
Dr Kaoru Ishikawa (1915 – 1989)
Dr Kaoru Ishikawa, amongst other things, gave his name to the Ishikawa
diagram. The Ishikawa diagram is also known as the “fishbone diagram” or
“cause and effect diagram” and is a problem-solving tool used in Quality Circles.
Kaoru Ishikawa received many esteemed quality awards including the Deming
Prize. He led the “Total Quality Control” movement with focus on statistical
quality control techniques such as control charts and Pareto charts.
Quality Circles
Kaoru Ishikawa led the concept and use of Quality Circles. The intended purpose
of a Quality Circle is to;
Support the improvement and development of the company
Respect human relations in the workplace and increase job satisfaction
Draw out employee potential
He believed quality must be company wide – including the product, service,
management, the company itself and the people. Quality improvement must be
company wide in order to be successful and sustainable.
Many, including Juran and Crosby, consider Kaoru Ishikawa’s teachings to be
more successful in Japan than in the West. Quality circles are effective when
management understand statistical quality management techniques and
are committed to act on their recommendations.
Genichi Taguchi - Quality Loss Function and
Robust Design
Genichi Taguchi is a Japanese quality expert, known for the Quality Loss Function
and for methodologies to optimize quality at the design stage – “robust design”.
Taguchi received formal recognition for his work including Deming Prizes and
Awards.
Genichi Taguchi considers quality loss all the way through to the customer,
including cost of scrap, rework, downtime, warranty claims and ultimately reduced
market share.
Genichi Taguchi's Quality Loss Function
The Quality Loss Function gives a financial value for customers'
increasing dissatisfaction as the product performance goes below the desired target
performance.
Equally, it gives a financial value for increasing costs as product performance goes
above the desired target performance. Determining the target performance is an
educated guess, often based on customer surveys and feedback.
The quality loss function allows financial decisions to be made at the design
stage regarding the cost of achieving the target performance.
Quality through Robust Design Methodology
Taguchi methods emphasized quality through robust design, not quality through
inspection. Taguchi breaks the design process into three stages:
1. System design - involves creating a working prototype
2. Parameter design - involves experimenting to find which factors influence
product performance most
3. Tolerance design - involves setting tight tolerance limits for the critical
factors and looser tolerance limits for less important factors.
Taguchi’s Robust Design methodologies allow the designer through experiments to
determine which factors most affect product performance and which factors are
unimportant.
The designer can focus on reducing variation on the important or critical factors.
Unimportant or uncontrollable “noise” factors have negligible impact on the
product performance and can be ignored.
Robust Design of Cookies
This is easier explained by example. If your business makes cookies from raw
ingredients, there are many possible factors that could influence the quality of the
cookie - amount of flour, number of eggs, temperature of butter, heat of oven,
cooking time, baking tray material etc.
With Genichi Taguchi’s Robust Design methodologies you would set up
experiments that would test a range of combinations of factors - for example, high
and low oven temperature, with long and short cooking time, 1 or 2 eggs, etc. The
cookies resulting from each of these trials would be assessed for quality.
A statistical analysis of results would tell you which the most important factors are,
for example oven temperature affects cookie quality more than the number of
eggs.
With this knowledge you would design a process that ensures the oven maintains
the optimal temperature and you would be able to consistently produce good
cookies.
Shigeo Shingo - Poka yoke, source inspection,
mistake proofing and SMED ( 1919 – 1990)
Shigeo Shingo’s work is better known than his name. His work includes; Poka
yoke, source inspection, mistake proofing, SMED (single minute exchange of die)
and contribution to Just In Time (JIT) production.
Shigeo Shingo's quality teachings were successful as they were practical and action
oriented.
Poka Yoke
“Poka yoke” is about stopping processes as soon as a defect occurs, identifying
the defect source and preventing it from happening again. Statistical quality
inspection will ultimately no longer be required, as there will be no defects to
detect – “zero defects”.
Poka yoke relies on source inspection, detecting defects before they affect the
production line and working to eliminate the defect cause.
Mistake Proofing
Mistake proofing is also a component of poka yoke. Shingo introduced simple
devices that make it impossible to fit a part incorrectly or make it obvious when
a part is missing. This means that errors are prevented at source, supporting a zero
defects process.
SMED (single minute exchange of die)
Shigeo Shingo developed SMED (single minute exchange of die) techniques
for quick changeovers between products. By simplifying materials, machinery,
processes and skills, changeover times could be reduced from hours to minutes.
Quick changeovers meant products could be produced in small batches or even
single units, with minimal disruption. This enabled Just In Time production, as
pioneered by the Toyota company.
Just in Time Production
Just In Time production is about supplying the customer with what they want,
exactly when they want it. Traditional manufacturing tended to large batch
production as this gave economies of scale, however required large inventories of
raw materials and finished goods. Orders are “pushed” through the system.
The aim of Just In Time is to minimise inventories by only producing what is
required, when it is required. Orders are “pulled” through the system, triggered by
a customer order. This reduces costs and waste throughout the production process.
In summary, Shigeo Shingo focused on practical differences that made immediate
differences, rather than theory.
Tom Peters
Tom Peters is a hugely successful management guru, considered by some to be
the gurus' guru. Peters best known book “In Search of Excellence”, co-authored
with Robert Waterman, presents 8 common themes of successful corporations:
1. A bias for action - getting on with it.
2. Close to the customer - learning from the customer.
3. Autonomy and entrepreneurship.
4. Productivity through people.
5. Hands-on, value-driven - management walk the talk.
6. Stick to the knitting – do what you know.
7. Simple form, lean staff.
8. Simultaneous loose-tight properties – have autonomy in some areas, central
ideas/values in others.
These themes were based on consultant company McKinsey’s 7-S model and from
analysis of 43 fortune-500 companies. Peters emphasizes the role of people,
customers and action and the need to move away fromTaylor-ist “bean-
counters”.
QUALITY POLICY OF TOYOTA
Toyota Turkey is a TOYOTA's production base for European market including
Turkey. Our mission is to contribute to Turkish society through producing high
quality vehicles in Turkey.
Customers are seeking high quality vehicles with lower costs delivered to them in
the specifications they need and in time with their demands.
As customer satisfaction is our primary objective, and quality is the prerequisite for
that, it is our mandate to deliver what our customers demand and maintain our
competitiveness.
We have to accomplish this mission constructed on following principles:
- Total Quality Control, based on mutual trust among ourselves and involvement
of every single member of our organization is our Company life style. We cannot
compromise for quality in anything we do.
- We are committed to continuous improvement ( Kaizen ) in all our activities and
practices.
- We shall cooperate with and assist our suppliers tro for continuous improvement
in their products, services and practices.
- Our quality target is to be always better than competitors and also to be better
than other Toyota Motor Corporation plants, producing CS No. 1 vehicles.
REASONS FOR SUCCESS
Ford and Chevy dominated the market when Toyota , a virtually unknown
importer, opened its first American car dealership in California in 1957. More than
50 years later, Toyota is now the world's biggest carmaker, earning top marks from
experts and customers alike for quality and innovation. U.S. News asked David
Magee, author of How Toyota Became # 1 , to highlight some of the reasons
for Toyota's success:
Long-term planning. Instead of responding to trends, fads, and quarterly
numbers, Toyota looks far down the road and tries to develop products that will
resonate for a long time. The best example is the Prius hybrid—which debuted
eight years ago, when a gallon of gas in the United States cost a mere $1.50, and
the average car buyer cared more about cup holders than gas mileage. The iconic
hybrid, of course, turned out to be a breakthrough vehicle, and Toyota sold its 1
millionth Prius this month. With gas prices and fuel economy now a top concern,
the Prius has helped Toyota take a commanding lead in hybrid technology.
Studious speediness. Suppliers sometimes complain that Toyota takes forever to
make a decision. But that's usually because the company exhaustively researches
all its options, then makes sure all the major stakeholders agree on a course of
action. Once Toyota decides to build a car, however, the turbocharger kicks in:
Toyota can move a product to market faster than almost all of its competitors.
An open mind. Toyota learned many of its early lessons from Americans,
studying Ford Motor Co.'s production lines and the theories of management guru
W. Edwards Deming. That helped Toyota gain a foothold in the United States, the
world's biggest car market, even though the company was an outsider whose home
market of Japan was vastly different. Decades later, Toyota still shows a knack for
figuring out what customers want, sometimes predicting American tastes better
than the Detroit automakers that supposedly have home-field advantage.
Obsession with waste. Toyota's "continuous improvement" ethos is legendary
throughout industry, but Magee believes the real secret is a profound disdain for
inefficiency—whether it's wasted time, excess material, or a scrap of trash on a
factory floor. "At a lot of companies, if something's going well and it's profitable,
they'll move on to something else," Magee says. "But if Toyota can attach a hood
in eight minutes, they'll find a way to whittle that down to four minutes, then two
minutes, then who knows..."
Humility. Quick, name a famous Toyota executive. Can't? Well, here's why:
Toyota's company culture emphasizes teamwork over individual stars. "Toyota
executives don't see themselves as bigger than the company or the customer or the
product," Magee says. "It's the most humble company I've been in." At Toyota
factories, the plant manager doesn't even get a reserved parking space, a perk that
is practically universal among manufacturing companies
SCOPE OF IMPROVEMENT
TMS is currently documenting its contract management processes in
preparation to extend these across other Toyota business units.
Since deploying contract management to IT, procurement, Toyota
Financial Services, and NAPO, TMS has opened up the application
to Toyota Canada, and Toyota Motor Manufacturing North America
as well. The goal is to identify software and IT contracts and negotiate
volume discounts and service levels across Toyota’s businesses. Barton
expects that contract management will better support Toyota’s sourcing
strategies, portfolio management, and project prioritizations and
delivery goals. In short, standardizing and automating contract
management operations fosters the continuous improvement spirit
of Toyota’s kaizen culture.
SUGGESTIONS FOR IMPROVEMENT
Toyota has started a new way for improving their product and services by giving
the public to give opinions and suggestions for improvements. Some of them are
given below.
1. The brand image is meaningless. It is the consumer's image that matters. To
be a Toyota driver today is to display that you are willing to put children in
harm's way-your children, the children of friends, and strangers' children
too. People are abandoning Toyota because this display jeopardizes their
ability to belong in society. This is the real problem the company must
solve.
2. Electricity generated from coal or oil will not make electric cars
environment friendly - the dirt is produced elswhere. But it will help big
cities to promote clean air. So think about the best size, price and range for a
popular car for all those big cities.
3. I think the main issue for Toyota is the perception that quality has suffered
over the years, as Toyota has banked on its reputation while relentlessly
cutting costs and doing away with whatever they can - which has resulted in
a product which just isn't as good, and won't last as long, as older models.
Many recent buyers complain that the fit and finish are not what they
expected, and of course the safety issues cannot be minimized. This is an
exercise beyond 'get-back-to-basics' and involves value for money and
paying more attention to what is important to consumers, in an era of
increasing competition not just from other Asian makes but also the
resurgent Ford and European manufacturers. They need to reevaluate the
brand promise and what they're willing to give up in terms of profits to
restore their reputation in the US with middle class new car buyers
4. There is a rapidly growing electric car market. Their major weakness is
range anxiety. But not having to carry around a fuel tank and engine of a
hybrid is a benefit as well as a liability.
5. The brake pedal should slow down and stop your cars.
The accelerator should speed it up when called upon.
Stick with the basics.