165396513 Total Quality Management Project 140509051236 Phpapp01

TOTALQUALITYMANAGEMENT

AProject report

on

Hamdard Institute of Management ScienceMBA Executive Page 1


ACKNOWLEDGEMENT

One of the pleasant aspects of preparing a project report is the opportunity to thank those who have contributed to make this project possible.

We are extremely thankful to Dr. Yasin of HIMS, whose active interest in the project & insight helped us to formulate, redefine implement our approach to the project.

We are also thankful to our College Library & other seen unseen hands which have given us direct & indirect help in completion of this project.

THANK YOU.



CONTENTS Introduction of TQM pg # 4

Characteristics of TQM pg # 6

Fundamental Elements of TQM pg # 6

Classification of TQM pg # 7

Guideline to Improve Product Quality pg # 14

Dr W. Edward Deming's 14 Principles pg # 18

DMAIC Six Sigma approach pg # 20

Advantages of TQM pg # 21

Problems & Solutions pg # 23

Case # 1 Mahindra Group pg # 24



Case # 2 G.C.M.M.F. LTD. (AMUL) pg # 44

Story on TQM pg # 57

Recommendations on TQM pg # 60

Introduction of Total Quality Management

Major Project objectives are to:

1. Understand what Total Quality Management (TQM) is and why it is important.

2. Outline various definition of quality and project TQMS viewpoint about quality.

3. Trace the various ways TQM has been defined and give its comprehensive definition.

4. Bring Out the characteristic features of TQM.

5. Give special attention to the way TQM has been presented as a model.

6. Explain the benefits of TQM.

7. Discuss the evolution of TQM in its present from thought the four phases of inspection, SQC, Quality Assurance & TQM.

Although the concept of quality is very old, today it is perhaps the major preoccupation of organization world-wide. However, in the recent years, Total Quality Management (TQM) has captured the world-wide attention and is being adopted in many organizations, both profit & non-profit. TQM is being accepted as a management philosophy. Many organizations around the globe are conduction Organizational Development (OD) program to enhance quality awareness and change the attitudes of their employees. These efforts towards understandings, adopting and promoting TQM are primarily because of the changes taking place in the global economy, changing market conditions and customers expectations and increasing competitive pressure. Many large organizations have recognized the important contributions that TQM can make in dealing with these challenges.

The objective of this chapter it to trace the evolution of TQM, as general philosophy and a set of paradigms; Attempt is also made to discuss the significant contributions of various pioneering promoters of TQM philosophy towards the design, development and application of TQM systems. Various definitions and models of TQM are also outlined is this chapter to have a preliminary but fundamental grasp over the subject.

MEANING OF TQM


TOTALQUALITYMANAGEMENTTQM, thus, can be considered as being constituted of two composite elements namely Quality Management meaning that aspect of the overall function that determines and implements the quality policy ; and Quality Systems meaning the collective plans, activities and events that are provided to ensure that a product, Process or service will satisfy given needs.

TQM means many things to much organization. It has evolved itself to be associated more often with statistical tools and process control, than with a method of management. In its essential sense, TQM is a means of operating a business that seeks to maximize an organizations value through maximizing customer satisfaction at the lowest possible cost and is achieved by continuously improving all processes within the organization and collaborating with people.

Total Quality Management is thus based on the concepts and philosophies advocated by Juran, Deming, Crossby, and Feigenbaum. Conceptually, TQM emphasizes on:

Top management commitment and support for quality improvement.

Creating a production oriented total quality culture.

Creating a Customer-oriented manufacturing environment.

Improving participation and teamwork

Prevention of errors at source.

Respect for humanity.

Recongnition and reward for improvement efforts.

QUALITY DEFINED

Quality though familiar to everyone has a variety of uses and meanings. The classic perception of quality is the position of a product attitude on a good-bad scale. Most people associate it with defects in products. However, quality relates not only to the product but also to the instruction for its use, to installations, to service, to marketing and so on. Quality has been defined in various ways, Some of the important definitions of quality are presented below :

1. Quality is fitness for use (Juran, 1974).

2. Quality is conformance to requirements (Crossby, 1984).

3. Quality means The actual use and the selling price of the product (Feigenbaum, 1961).

4. Quality is the capability composite of products or services to knowingly satisfy those preconceived composite wants of the user(s) that are intelligently related to the characteristics of performance, and do not cause major overt or convert reaction or actions by other people (Johnson, 1987).


TOTALQUALITYMANAGEMENT5. The Totality of features and characteristics of products or services that bears on its ability to satisfy given needs (ANSI & ASAC, 1978).

Quality is, thus, both a user-oriented and a production-oriented expression. From the users point of view, quality is an expression of the products/services usefulness in meeting the needs and expectations and its reliability, safety, durability and so on. From the production point of view, the quality of a product is measured by the quality of its performance which depends on the quality of design and the quality of conformance. Quality of design is concerned with the stringency of the specifications for manufacturing the product. The quality of conformance is concerned with how well the manufactured product conforms to the original requirements.

Different views of quality are held by marketing, engineering and manufacturing departments. Garvin (1988) outlines these as :

Transcendent Qualtiy as a Simple analyzable property recognized only though experience.

Product based Quality as a precise and measurable variable.

User based Quality lies in the eyes of the beholder

Manufacturing based Quality as conformance to the requirements.

Value based Quality as performance or conformance at acceptable price or cost.

Quality, therefore, is

Defined by the customers

A measure of achievement of customer satisfaction

Fulfilling the customers needs/requirements

Value for money

Keeping ones word

Ensuring no defects

Image of the company and customer confidence in the organization

A precise and measuring variable

Utility to the society

CHARACTERISTICS OF TQM:

The Characteristics of TQM, as revealed from the above definitions and models are as follows:


TOTALQUALITYMANAGEMENT1. TQM is customer oriented.

2. TQM requires a long term commitment for continuous improvement of all processes.

3. The success of TQM demands the leadership of top management and continuous involvement.

4. Responsibility for establishment and improvement of system lies with the management of an organisation.

5. TQM is a strategy for continuously improving performance at all levels and in all areas of responsibility.

FOLLOWING AS THE FOUNDATIONAL ELEMENTS OF TQM.

1. People: TQM aims at empowering people so as to accomplish optimal business results through teamwork. This involves training that focuses on communication skills, interactive skills and effective meeting skills. Such training enables people to be actively involved in the continuous improvement of products and processes and leads to improved teamwork.

2. Continuous improvement: It involves the fundamental principle of quality, the Daming cycle and th4e PDCA (Plan, Do, Check, Action) cycle. The iteration of cycle is the never ending pursuit of excellence.

3. Process : The use of problem solving process as a guide to analyze a problem, choose a solution, develop an action plan and evaluate implementation results ; and the use of quality improvement process for reducing customer requirements to a specification and specification to a defined work process so as to focus attention on the customer and customer requirements.

4. Customer: TQMs primary focus is the customer and customer satisfaction. Customer perceptions of quality that correlates with customers satisfaction are expected quality, satisfying quality, delightful quality, indifferent quality and reverse quality. These must be aimed at to prevent customer dissatisfaction, to meet customers expectations and delighted them.

CLASSIFICATION OF TOTAL QUALITY MANAGEMNT

Quality management evolution

Quality management is not a recent phenomenon. Advanced civilizations that supported the arts and crafts allowed clients to choose goods meeting higher quality standards than normal goods. In societies where art and craft (and craftsmanship) were valued, one of the responsibilities of a master craftsman (and similarly for artists) was to lead their studio, train and supervise the work of their craftsmen and apprentices. The master craftsman set standards, reviewed the work of others and ordered rework and revision as necessary. One of the limitations of the craft approach was that relatively few goods could be produced, on the other hand an advantage was that each item produced could be individually shaped to suit the client. This craft based approach to quality and the practices used were major inputs when quality management was created as a management science.

During the industrial revolution, the importance of craftsmen was diminished as mass production and repetitive work practices were instituted. The aim was to produce large numbers of the same goods. The first proponent in the US for this approach was Eli Whitney who proposed (interchangeable) parts manufacture for muskets, hence producing the identical components and creating a musket assembly


TOTALQUALITYMANAGEMENTline. The next step forward was promoted by several people including Frederick Winslow Taylor a mechanical engineer who sought to improve industrial efficiency. He is sometimes called "the father of scientific management." He was one of the intellectual leaders of the Efficiency Movement and part of his approach laid a further foundation for quality management, including aspects like standardization and adopting improved practices. Henry Ford also was important in bringing process and quality management practices into operation in his assembly lines. In Germany, Karl Friedrich Benz, often called the inventor of the motor car, was pursuing similar assembly and production practices, although real mass production was properly initiated in Volkswagen after world war two. From this period onwards, north American companies focused predominantly upon production against lower cost with increased efficiency.

Walter A. Shewhart made a major step in the evolution towards quality management by creating a method for quality control for production, using statistical methods, first proposed in 1924. This became the foundation for his ongoing work on statistical quality control. W. Edwards Deming later applied statistical process control methods in the United States during World War II, thereby successfully improving quality in the manufacture of munitions and other strategically important products.

Quality leadership from a national perspective has changed over the past five to six decades. After the Second World War, Japan decided to make quality improvement a national imperative as part of rebuilding their economy, and sought the help of Shewhart, Deming and Juran, amongst others. W. Edwards Deming championed Shewhart's ideas in Japan from 1950 onwards. He is probably best known for his management philosophy establishing quality, productivity, and competitive position. He has formulated 14 points of attention for managers, which are a high level abstraction of many of his deep insights. They should be interpreted by learning and understanding the deeper insights and include:

Break down barriers between departments Management should learn their responsibilities, and take on leadership Improve constantly Institute a programme of education and self-improvement

In the 1950s and 1960s, Japanese goods were synonymous with cheapness and low quality, but over time their quality initiatives began to be successful, with Japan achieving very high levels of quality in products from the 1970s onward. For example, Japanese cars regularly top the J.D. Power customer satisfaction ratings. In the 1980s Deming was asked by Ford Motor Company to start a quality initiative after they realized that they were falling behind Japanese manufacturers. A number of highly successful quality initiatives have been invented by the Japanese (see for example on this page: Taguchi, QFD, Toyota Production System. Many of the methods not only provide techniques but also have associated quality culture aspects (i.e. people factors). These methods are now adopted by the same western countries that decades earlier derided Japanese methods.

Customers recognize that quality is an important attribute in products and services. Suppliers recognize that quality can be an important differentiator between their own offerings and those of competitors (quality differentiation is also called the quality gap). In the past two decades this quality gap has been greatly reduced between competitive products and services. This is partly due to the contracting (also called outsourcing) of manufacture to countries like India and China, as well internationalization of trade and competition. These countries amongst many others have raised their own standards of quality in order to meet International standards and customer demands. The ISO 9000 series of standards are probably the best known International standards for quality management.

There are a huge number of books available on quality. In recent times some themes have become more significant including quality culture, the importance of knowledge management, and the role of leadership in promoting and achieving high quality. Disciplines like systems thinking are bringing more


TOTALQUALITYMANAGEMENTholistic approaches to quality so that people, process and products are considered together rather than independent factors in quality management.

Quality improvement

There are many methods for quality improvement. These cover product improvement, process improvement and people based improvement. In the following list are methods of quality management and techniques that incorporate and drive quality improvement

1. ISO 9004 :2000 Guidelines for performance improvement. 2. ISO 15504 -4: 2005 Information technology Process assessment Part 4: Guidance on use

for process improvement and process capability determination. 3. QFD Quality Function Deployment, also known as the House of Quality approach. 4. Kaizen Japanese for change for the better; the common English usage is continual

improvement. 5. Zero Defect Program created by NEC Corporation of Japan, based upon Statistical Process

Control and one of the inputs for the inventors of Six Sigma. 6. Six Sigma 6, Six Sigma combines established methods such as Statistical Process Control,

Design of Experiments and FMEA in an overall framework. 7. PDCA Plan, Do, Check, Act cycle for quality control purposes. (Six Sigma's DMAIC method

(Design, Measure, Analyze, Improve, Control) may be viewed as a particular implementation of this.)

8. Quality circle a group (people oriented) approach to improvement. 9. Taguchi methods statistical oriented methods including Quality robustness, Quality loss

function and Target specifications. 10. The Toyota Production System reworked in the west into Lean Manufacturing. 11. Kansei Engineering an approach that focuses on capturing customer emotional feedback about

products to drive improvement. 12. TQM Total Quality Management is a management strategy aimed at embedding awareness of

quality in all organizational processes. First promoted in Japan with the Deming prize which was adopted and adapted in USA as the Malcolm Baldrige National Quality Award and in Europe as the European Foundation for Quality Management award (each with their own variations).

13. TRIZ meaning "Theory of inventive problem solving" 14. BPR Business process reengineering, a management approach aiming at 'clean slate'

improvements (That is, ignoring existing practices).

Proponents of each approach have sought to improve them as well as apply them to enterprise types not originally targeted. For example, Six Sigma was designed for manufacturing but has spread to service enterprises. Each of these approaches and methods has met with success but also with failures.

Some of the common differentiators between success and failure include commitment, knowledge and expertise to guide improvement, scope of change/improvement desired (Big Bang type changes tend to fail more often compared to smaller changes) and adaption to enterprise cultures. For example, quality circles do not work well in every enterprise (and are even discouraged by some managers), and relatively few TQM-participating enterprises have won the national quality awards.

There have been well publicized failures of BPR, as well as Six Sigma. Enterprises therefore need to consider carefully which quality improvement methods to adopt, and certainly should not adopt all those listed here.

It is important not to underestimate the people factors, such as culture, in selecting a quality improvement approach. Any improvement (change) takes time to implement, gain acceptance and


TOTALQUALITYMANAGEMENTstabilize as accepted practice. Improvement must allow pauses between implementing new changes so that the change is stabilized and assessed as a real improvement, before the next improvement is made (hence continual improvement, not continuous improvement).

Improvements that change the culture take longer as they have to overcome greater resistance to change. It is easier and often more effective to work within the existing cultural boundaries and make small improvements (that is Kaizen) than to make major transformational changes. Use of Kaizen in Japan was a major reason for the creation of Japanese industrial and economic strength.

On the other hand, transformational change works best when an enterprise faces a crisis and needs to make major changes in order to survive. In Japan, the land of Kaizen, Carlos Ghosn led a transformational change at Nissan Motor Company which was in a financial and operational crisis. Well organized quality improvement programs take all these factors into account when selecting the quality improvement methods.

Quality standards

The International Organization for Standardization (ISO) created the Quality Management System (QMS) standards in 1987. These were the ISO 9000:1987 series of standards comprising ISO 9001:1987, ISO 9002:1987 and ISO 9003:1987; which were applicable in different types of industries, based on the type of activity or process: designing, production or service delivery.

he standards have been regularly reviewed every few years by the International Organization for Standardization. The version in 1994 and was called the ISO 9000:1994 series; comprising of the ISO 9001:1994, 9002:1994 and 9003:1994 versions.

The last revision was in the year 2000 and the series was called ISO 9000:2000 series. However the ISO 9002 and 9003 standards were integrated and one single certifiable standard was created under ISO 9001:2000. Since December 2003, ISO 9002 and 9003 standards are not valid, and the organizations previously holding these standards need to do a transition from the old to the new standards.

The ISO 9004:2000 document gives guidelines for performance improvement over and above the basic standard (ISO 9001:2000). This standard provides a measurement framework for improved quality management, similar to and based upon the measurement framework for process assessment.

The Quality Management System standards created by ISO are meant to certify the processes and the system of an organization and not the product or service itself. ISO 9000 standards do not certify the quality of the product or service.

Recently the International Organization for Standardization released a new standard, ISO 22000, meant for the food industry. This standard covers the values and principles of ISO 9000 and the HACCP standards. It gives one single integrated standard for the food industry and is expected to become more popular in the coming years in such industry.

ISO has a number of standards that support quality management. One group describes processes (including ISO 12207 & ISO 15288) and another describes process assessment and improvement ISO 15504.

The Software Engineering Institute has its own process assessment and improvement methods, called CMMi (Capability Maturity Model integrated) and IDEAL respectively.


TOTALQUALITYMANAGEMENTBusiness benefits of ISO 14000

This section identifies typical benefits for organizations of implementing ISO 14000 standards.

Most managers will try to avoid pollution that could cost the company a fine for infringing environmental legislation. But better managers will agree that doing only just enough to keep the company out of trouble with government inspectors is a rather weak and reactive approach to business in today's environment-conscious world.

The ISO 14000 standards are practical tools for the manager who is not satisfied with mere compliance with legislation which may be perceived as a cost of doing business. They are for the proactive manager with the vision to understand that implementing a strategic approach can bring return on investment in environment-related measures.

The systematic ISO 14001:2004 approach requires the organization to take a hard look at all areas where its activities have an environmental impact. And it can lead to benefits like the following:

reduced cost of waste management savings in consumption of energy and materials lower distribution costs improved corporate image among regulators, customers and the public framework for continual improvement of environmental performance.

The manager who is "too busy managing the business" to listen to good sense about environmental management could actually be costing the business, instead of achieving benefits like those above.

Certification

Certification is not a requirement of any of ISO's management system standards. This section provides a basic understanding of what certification and related terms mean.

Certification, registration and accreditation

In the context of ISO 9001:2000 or ISO 14001:2004, certification refers to the issuing of written assurance (the certificate) by an independent external body that it has audited a management system and verified that it conforms to the requirements specified in the standard.

Registration means that the auditing body then records the certification in its client register. So, the organizations management system has been both certified and registered.

Therefore, in the ISO 9001:2000 or ISO 14001:2004 context, the difference between the two terms is not significant and both are acceptable for general use. Certification is the term most widely used worldwide, although registration is often preferred in North America, and the two are used interchangeably.

On the contrary, using accreditation as an interchangeable alternative for certification or registration is a mistake, because it means something different.

In the ISO 9001:2000 or ISO 14001:2004 context, accreditation refers to the formal recognition by a specialized body an accreditation body that a certification body is competent to carry out ISO 9001:2000 or ISO 14001:2004 certification in specified business sectors.


TOTALQUALITYMANAGEMENTIn simple terms, accreditation is like certification of the certification body. Certificates issued by accredited certification bodies may be perceived on the market as having increased credibility.

Quality terms

Quality Improvement can be distinguished from Quality Control in that Quality Improvement is the purposeful change of a process to improve the reliability of achieving an outcome.

Quality Control is the ongoing effort to maintain the integrity of a process to maintain the reliability of achieving an outcome.

Quality Assurance is the planned or systematic actions necessary to provide enough confidence that a product or service will satisfy the given requirements for quality.

Implementation of Total Quality Management (TQM)

Total Quality Management is a management approach that originated in the 1950's and has steadily become more popular since the early 1980's. Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with processes being done right the first time and defects and waste eradicated from operations.

Total Quality Management, TQM, is a method by which management and employees can become involved in the continuous improvement of the production of goods and services. It is a combination of quality and management tools aimed at increasing business and reducing losses due to wasteful practices.

Some of the companies who have implemented TQM include Ford Motor Company, Phillips Semiconductor, SGL Carbon, Motorola and Toyota Motor Company.

The Concept of Continuous Improvement by TQM

TQM is mainly concerned with continuous improvement in all work, from high level strategic planning and decision-making, to detailed execution of work elements on the shop floor. It stems from the belief that mistakes can be avoided and defects can be prevented. It leads to continuously improving results, in all aspects of work, as a result of continuously improving capabilities, people, processes, technology and machine capabilities.

Continuous improvement must deal not only with improving results, but more importantly with improving capabilities to produce better results in the future. The five major areas of focus for capability improvement are demand generation, supply generation, technology, operations and people capability.

A central principle of TQM is that mistakes may be made by people, but most of them are caused, or at least permitted, by faulty systems and processes. This means that the root cause of such mistakes can be identified and eliminated, and repetition can be prevented by changing the process.1

There are three major mechanisms of prevention:

1. Preventing mistakes (defects) from occurring (Mistake - proofing or Poka-Yoke). 2. Where mistakes can't be absolutely prevented, detecting them early to prevent them being passed

down the value added chain (Inspection at source or by the next operation). 3. Where mistakes recur, stopping production until the process can be corrected, to prevent the

production of more defects. (Stop in time).


TOTALQUALITYMANAGEMENTImplementation Principles and Processes

A preliminary step in TQM implementation is to assess the organization's current reality. Relevant preconditions have to do with the organization's history, its current needs, precipitating events leading to TQM, and the existing employee quality of working life. If the current reality does not include important preconditions, TQM implementation should be delayed until the organization is in a state in which TQM is likely to succeed.

If an organization has a track record of effective responsiveness to the environment, and if it has been able to successfully change the way it operates when needed, TQM will be easier to implement. If an organization has been historically reactive and has no skill at improving its operating systems, there will be both employee skepticism and a lack of skilled change agents. If this condition prevails, a comprehensive program of management and leadership development may be instituted. A management audit is a good assessment tool to identify current levels of organizational functioning and areas in need of change. An organization should be basically healthy before beginning TQM. If it has significant problems such as a very unstable funding base, weak administrative systems, lack of managerial skill, or poor employee morale, TQM would not be appropriate.5

However, a certain level of stress is probably desirable to initiate TQM. People need to feel a need for a change. Kanter (1983) addresses this phenomenon be describing building blocks which are present in effective organizational change. These forces include departures from tradition, a crisis or galvanizing event, strategic decisions, individual "prime movers," and action vehicles. Departures from tradition are activities, usually at lower levels of the organization, which occur when entrepreneurs move outside the normal ways of operating to solve a problem. A crisis, if it is not too disabling, can also help create a sense of urgency which can mobilize people to act. In the case of TQM, this may be a funding cut or threat, or demands from consumers or other stakeholders for improved quality of service. After a crisis, a leader may intervene strategically by articulating a new vision of the future to help the organization deal with it. A plan to implement TQM may be such a strategic decision. Such a leader may then become a prime mover, who takes charge in championing the new idea and showing others how it will help them get where they want to go. Finally, action vehicles are needed and mechanisms or structures to enable the change to occur and become institutionalized.

Process Oriented Management V/S Result Oriented Management:

Lets consider this, said the professor. How is Process Oriented Management (PROM) different from Result Oriented Management (ROM)? Is it that in Process Oriented Management, you dont bother about the result? No. That is not the case.

Process oriented management is based on the paradigm (mindset) that the result is the effect of a number of causes, If we concentrate on the causes an ensure that the causes operate exactly as the way we want to, the result is bound to happen (barring a random element that is uncontrollable by its very nature, such as major earthquake.) Since results are bound to happen when the causes are perfected, Process Oriented Management recommends that we stop worrying about the result. (Incidentally, the philosophy of karmanye wadhikaraste ma phaleshu kadachana implies the same thing; concentrate on perfecting the causes in the process and the result is bound to come since the result is bouondto be achieved, we can therefore, forget about it. This philosophy is often misunderstood as keep working without caring for the result)

Process oriented management is deeply concerned about the result. An analogy might help. A student is told Get good marks, I dont care how. What kind of management is it Is it good?


TOTALQUALITYMANAGEMENTAnother student is told, You must get the marks, so find out the correct way to study, and study

with regularity and diligence. Would this policy work? Which kind of management would you like to use in your organization? Western management has gone too far with result oriented management; managers find that they have to produce result by hook or by crook. Naturally they find that producing result is a marathon exercise every time.

In Process Oriented Management, you first study the process.

What is the difference between a process and an operation?

A Process is summation of activities such as operations, inspections, delays, storage, transports, and everything else that happens between the beginning and the end of the process. In contrast, an Operation does not include inspection, delays an all the other aspects. There are two types operations: Do and Make ready. For instance, warming up an electric iron till it reaches the desired temperature is a make ready operation, while ironing is a do operation.

There are tow types of activities: Value Adding Activities (VA) and Non Value Adding Activities (NVA).

By definition, Value Adding Activities are those that add value to product as seen from the customers point of view. All others are Non Value Adding activities. Even make ready operations are NVAs.

Process oriented management first classifies all activities performed as VA or NVA and attacks Non Value Adding activities first! This is because if you conduct actual studies on any process, you are most likely to find that the amount of time spent of Non Value Adding activities exceeds the amount of time spent of Value Adding activities.

Typically, result oriented management attacks Value Adding activities and tries to make them more efficient in the belief that it is only the VA activities that matter. They often end up making VA more efficient and losing more than what was gained because the NVA, that were ignored, increased enormously.

Many companies have increased production rate; simultaneously increasing inventories (storage, delays and transports). They often find that the bottom line does not improve; though the production rate has increase. They cant understand why. Now, having learned about process oriented management, we can understand the reason.

We should first have a clear understanding of the entire process in terms of all those activities, which are Value Adding and Non Value Adding. Normally the NVA activities are much more in number and the time taken for the NVA activities is also very large as compared to the VA activities.

The NVA activities should be eliminated be eliminated or mad efficient in terms of time taken, till they become equivalent to the VA activities in terms of time taken. Now, both the VA and NVA activities should be simultaneously considered for improvement.

GUIDELINES TO BE FOLLOW TO IMPROVE QUALITY OF PRODUCT.

This document introduces the eight quality management principles on which the quality management system standards of the revised ISO 9000:2000 series are based. These principles can be


TOTALQUALITYMANAGEMENTused by senior management as a framework to guide their organizations towards improved performance. The principles are derived from the collective experience and knowledge of the international experts who participate in ISO Technical Committee ISO/TC 176, Quality management and quality assurance , which is responsible for developing and maintaining the ISO 9000 standards.

The eight quality management principles are defined in ISO 9000:2000, Quality management systems Fundamentals and vocabulary, and in ISO 9004:2000, Quality management systems Guidelines for performance improvements.

This document gives the standardized descriptions of the principles as they appear in ISO 9000:2000 and ISO 9004:2000. In addition, it provides examples of the benefits derived from their use and of actions that managers typically take in applying the principles to improve their organizations' performance.

Principle 1: Customer focus

Organizations depend on their customers and therefore should understand current and future customer needs, should meet customer requirements and strive to exceed customer expectations.

Key benefits:

Increased revenue and market share obtained through flexible and fast responses to market opportunities.

Increased effectiveness in the use of the organization's resources to enhance customer satisfaction. Improved customer loyalty leading to repeat business.

Applying the principle of customer focus typically leads to:

Researching and understanding customer needs and expectations. Ensuring that the objectives of the organization are linked to customer needs and expectations. Communicating customer needs and expectations throughout the organization. Measuring customer satisfaction and acting on the results. Systematically managing customer relationships. Ensuring a balanced approach between satisfying customers and other interested parties (such as

owners, employees, suppliers, financiers, local communities and society as a whole).

Principle 2: Leadership

Leaders establish unity of purpose and direction of the organization. They should create and maintain the internal environment in which people can become fully involved in achieving the organization's objectives.

Key benefits:

People will understand and be motivated towards the organization's goals and objectives. Activities are evaluated, aligned and implemented in a unified way. Miscommunication between levels of an organization will be minimized.

Applying the principle of leadership typically leads to:


TOTALQUALITYMANAGEMENT Considering the needs of all interested parties including customers, owners, employees, suppliers,

financiers, local communities and society as a whole. Establishing a clear vision of the organization's future. Setting challenging goals and targets. Creating and sustaining shared values, fairness and ethical role models at all levels of the

organization. Establishing trust and eliminating fear. Providing people with the required resources, training and freedom to act with responsibility and

accountability. Inspiring, encouraging and recognizing people's contributions.

Principle 3: Involvement of people

People at all levels are the essence of an organization and their full involvement enables their abilities to be used for the organization's benefit.

Key benefits:

Motivated, committed and involved people within the organization. Innovation and creativity in furthering the organization's objectives. People being accountable for their own performance. People eager to participate in and contribute to continual improvement.

Applying the principle of involvement of people typically leads to:

People understanding the importance of their contribution and role in the organization. People identifying constraints to their performance. People accepting ownership of problems and their responsibility for solving them. People evaluating their performance against their personal goals and objectives. People actively seeking opportunities to enhance their competence, knowledge and

experience. People freely sharing knowledge and experience. People openly discussing problems and issues.

Principle 4: Process approach

A desired result is achieved more efficiently when activities and related resources are managed as a process.

Key benefits:

Lower costs and shorter cycle times through effective use of resources. Improved, consistent and predictable results. Focused and prioritized improvement opportunities.

Applying the principle of process approach typically leads to:

Systematically defining the activities necessary to obtain a desired result.


TOTALQUALITYMANAGEMENT Establishing clear responsibility and accountability for managing key activities. Analysing and measuring of the capability of key activities. Identifying the interfaces of key activities within and between the functions of the organization. Focusing on the factors such as resources, methods, and materials that will improve key activities

of the organization. Evaluating risks, consequences and impacts of activities on customers, suppliers and other

interested parties.

Principle 5: System approach to management

Identifying, understanding and managing interrelated processes as a system contributes to the organization's effectiveness and efficiency in achieving its objectives

Key benefits:

Integration and alignment of the processes that will best achieve the desired results. Ability to focus effort on the key processes. Providing confidence to interested parties as to the consistency, effectiveness and efficiency of the

organization.

Applying the principle of system approach to management typically leads to:

Structuring a system to achieve the organization's objectives in the most effective and efficient way.

Understanding the interdependencies between the processes of the system. Structured approaches that harmonize and integrate processes. Providing a better understanding of the roles and responsibilities necessary for achieving common

objectives and thereby reducing cross-functional barriers. Understanding organizational capabilities and establishing resource constraints prior to action. Targeting and defining how specific activities within a system should operate. Continually improving the system through measurement and evaluation.

Principle 6: Continual improvement

Continual improvement of the organization's overall performance should be a permanent objective of the organization.

Key benefits:

Performance advantage through improved organizational capabilities. Alignment of improvement activities at all levels to an organization's strategic intent. Flexibility to react quickly to opportunities.

Applying the principle of continual improvement typically leads to:

Employing a consistent organization-wide approach to continual improvement of the organizations performance.

Providing people with training in the methods and tools of continual improvement.


TOTALQUALITYMANAGEMENT Making continual improvement of products, processes and systems an objective for every

individual in the organization. Establishing goals to guide, and measures to track, continual improvement. Recognizing and acknowledging improvements.

Principle 7: Factual approach to decision making

Effective decisions are based on the analysis of data and information

Key benefits:

Informed decisions. An increased ability to demonstrate the effectiveness of past decisions through reference to factual

records. Increased ability to review, challenge and change opinions and decisions.

Applying the principle of factual approach to decision making typically leads to:

Ensuring that data and information are sufficiently accurate and reliable. Making data accessible to those who need it. Analysing data and information using valid methods. Making decisions and taking action based on factual analysis, balanced with experience and

intuition.

Principle 8: Mutually beneficial supplier relationships

An organization and its suppliers are interdependent and a mutually beneficial relationship enhances the ability of both to create value

Key benefits:

Increased ability to create value for both parties. Flexibility and speed of joint responses to changing market or customer needs and expectations. Optimization of costs and resources.

Applying the principles of mutually beneficial supplier relationships typically leads to:

Establishing relationships that balance short-term gains with long-term considerations. Pooling of expertise and resources with partners. Identifying and selecting key suppliers. Clear and open communication. Sharing information and future plans. Establishing joint development and improvement activities. Inspiring, encouraging and recognizing improvements and achievements by suppliers.

Dr W. Edward Deming's 14 Principles


TOTALQUALITYMANAGEMENT1. Constancy of purpose: Create constancy of purpose for continual improvement of products and service to society, allocating resources to provide for long range needs rather than only short term profitability, with a plan to become competitive, to stay in business, and to provide jobs.

2. The new philosophy: Adopt the new philosophy. We are in a new economic age, created in Japan. We can no longer live with commonly accepted levels of delays, mistakes, defective materials and defective workmanship. Transformation of Western management style is necessary to halt the continued decline of business and industry.

3. Cease dependence on mass inspection: Eliminate the need for mass inspection as the way of life to achieve quality by building quality into the product in the first place. Require statistical evidence of built in quality in both manufacturing and purchasing functions.

4. End lowest tender contracts: End the practice of awarding business solely on the basis of price tag. Instead require meaningful measures of quality along with price. Reduce the number of suppliers for the same item by eliminating those that do not qualify with statistical and other evidence of quality. The aim is to minimize total cost, not merely initial cost, by minimizing variation. This may be achieved by moving toward a single supplier for any one item, on a long term relationship of loyalty and trust. Purchasing managers have a new job, and must learn it.

5. Improve every process: Improve constantly and forever every process for planning, production, and service. Search continually for problems in order to improve every activity in the company, to improve quality and productivity, and thus to constantly decrease costs. Institute innovation and constant improvement of product, service, and process. It is management's job to work continually on the system (design, incoming materials, maintenance, improvement of machines, supervision, training, retraining).

6. Institute training on the job: Institute modern methods of training on the job for all, including management, to make better use of every employee. New skills are required to keep up with changes in materials, methods, product and service design, machinery, techniques, and service.

7. Institute leadership: Adopt and institute leadership aimed at helping people do a better job. The responsibility of managers and supervisors must be changed from sheer numbers to quality. Improvement of quality will automatically improve productivity. Management must ensure that immediate action is taken on reports of inherited defects, maintenance requirements, poor tools, fuzzy operational definitions, and all conditions detrimental to quality.

8. Drive out fear: Encourage effective two way communication and other means to drive out fear throughout the organization so that everybody may work effectively and more productively for the company.

9. Break down barriers: Break down barriers between departments and staff areas. People in different areas, such as Leasing, Maintenance, Administration, must work in teams to tackle problems that may be encountered with products or service.

10. Eliminate exhortations: Eliminate the use of slogans, posters and exhortations for the work force demanding Zero Defects and new levels of productivity, without providing methods. Such exhortations only create adversarial relationships; the bulk of the causes of low quality and low productivity belong to the system, and thus lie beyond the power of the work force.

11. Eliminate arbitrary numerical targets: Eliminate work standards that prescribe quotas for the work force and numerical goals for people in management. Substitute aids and helpful leadership in order to achieve continual improvement of quality and productivity.

12. Permit pride of workmanship: Remove the barriers that rob hourly workers, and people in management, of their right to pride of workmanship. This implies, among other things, abolition of


TOTALQUALITYMANAGEMENTthe annual merit rating (appraisal of performance) and of Management by Objective. Again, the responsibility of managers, supervisors, foremen must be changed from sheer numbers to quality.

13. Encourage education: Institute a vigorous program of education, and encourage self improvement for everyone. What an organization needs is not just good people; it needs people that are improving with education. Advances in competitive position will have their roots in knowledge. 14. Top management commitment and action: Clearly define top management's permanent commitment to ever improving quality and productivity, and their obligation to implement all of these principles. Indeed, it is not enough that top management commit themselves for life to quality and productivity. They must know what it is that they are committed to-that is, what they must do. Create a structure in top management that will push every day on the preceding 13 Points, and take action in order to accomplish the transformation. Support is not enough: action is required!

DMAIC, six sigma approach.

The six sigma approach for projects is DMAIC (define, measure, analyze, improve and control). These steps are the most common six sigma approach to project work. Some organizations omit the D in DMAIC because it is really management work. With the D dropped from DMAIC the Black Belt is charged with MAIC only in that six sigma approach. We believe define is too important be left out and sometimes management does not do an adequate job of defining a project. Our six sigma approach is the full DMAIC.

Define (DMAIC).

Define is the first step in our six sigma approach of DMAIC. DMAIC first asks leaders to define our core processes. It is important to define the selected project scope, expectations, resources and timelines. The definition step in the six sigma approach identifies specifically what is part of the project and what is not, and explains the scope of the project. Many times the first passes at process documentation are at a general level. Additional work is often required to adequately understand and correctly document the processes. As the saying goes The devil is in the details.

Measure (DMAIC).

Many think when they start a journey the most important thing to know is where they are going. While we agree knowing where you want to go is very important, we believe some of the first information you need before starting any journey is your current location. The six sigma approach asks the Black Belt project manager to quantify and benchmark the process using actual data. At a minimum consider the mean or average performance and some estimate of the dispersion or variation (maybe even calculate the standard deviation). Trends and cycles can also be very revealing. The two data points and extrapolate to infinity is not a six sigma approach. Process capabilities can be calculated once there is performance data,

Analyze (DMAIC).

Once the project is understood and the baseline performance documented and verified that there is real opportunity, it is time with the six sigma approach to do an analysis of the process. In this step, the six sigma approach applies statistical tools to validate root causes of problems. Any number of tools and tests can be used. The objective is to understand the process at a level sufficient to be able to


TOTALQUALITYMANAGEMENTformulate options for improvement. We should be able to compare the various options with each other to determine the most promising alternatives. As with many activities, balance must be achieved. Superficial analysis and understanding will lead to unproductive options being selected, forcing recycle through the process to make improvements. At the other extreme is the paralysis of analysis. Striking the appropriate balance is what makes the six sigma Black Belt highly valuable.

Improve (DMAIC).

During the improve step of the six sigma approach ideas and solutions are put to work. The six sigma Black Belt has discovered and validated all known root causes for the existing opportunity. The six sigma approach requires Black Belts to identify solutions. Few ideas or opportunities are so good that all are an instant success. As part of the six sigma approach there must be checks to assure that the desired results are being achieved. Some experiments and trials may be required in order to find the best solution. When making trials and experiments it is important that all project associates understand that these are trials and really are part of the six sigma approach.

Control (DMAIC)

Many people believe the best performance you can ever get from a process is at the very beginning. Over time there is an expectancy that slowly things will get a little worse until finally it is time for another major effort towards improvement. Contrasted with this is the Kaizen approach that seeks to make everything incrementally better on a continuous basis. The sum of all these incremental improvements can be quite large. As part of the six sigma approach performance tracking mechanisms and measurements are in place to assure, at a minimum, that the gains made in the project are not lost over a period of time. As part of the control step we encourage sharing with others in the organization. With this the six sigma approach really starts to create phenomenal returns, ideas and projects in one part of the organization are translated in a very rapid fashion to implementation in another part of the organization.

POTENTIAL BENEFITS OF TQM:

The advantages of adopting TQM system compared to conventional quality system are numerous and are outlined below:

1. TQM helps to focus clearly on the needs of the market. The traditional approach of quality 2. control focuses on the technical details of a product so as to satisfy the customer. However, the customer longs for different satisfaction perspectives which are generally overlooked in the traditional approach. The needs change from person to person and also from place to place. As TQM focuses on the concept of universality, it tries to abstract the satisfaction perceptions of market and thus helps the organisation to identify and meet the requirements of the market in a better way.

3. TQM facilitates to aspire for a top quality performer in every sphere of activity. It is a well accepted fact that the negative attitudes of employees and non-participative culture of the organisations success, growth and prosperity. TQM emphasises, on bringing about attitudinal and cultural change through promotion of participative work culture and effective team-work. This serves to satisfy the higher human needs of recognition and self-development and enhances employees interest in the job. The employees performance, thus, is not restricted to the product or service areas but reflects in other spheres as well.

4. It channelizes the procedures necessary to achieve quality performance. Quality in its true sense cannot be achieved instantly. It requires a systematic and a long-term planning and strategic approach. By


TOTALQUALITYMANAGEMENTfocusing on defining the quality policies, goals and objectives, and communicating these properly to one and all in the organisation, adopting SQC and SPC techniques and developing and using a system of evaluation, the organisations can channelize their efforts to achieve the desired and objectivated quality performance.

5. It helps examine critically and continuously all processes to remove non-productive activities and waste. The organisations always aim at improving productivity as it leads to reduction in cost resulting in increase in profitability. The efforts in this direction are contributed because of the formation of quality improvement teams which meet regularly and through a systematic approach which tries to remove non-productive activity. A continuous effort to identify the problems and resolve them helps to reduce the waste. The culture of well being thus improves housekeeping, cost-effectiveness and safety.

6. It gears organisations to fully understand the competition and develop an effective combating strategy. The dynamic changes in the global market and the open market policies adopted by a large number of organisations ha resulted in increased competition and for many organisations the survival has become a key issue. For this cause, it is essential for the organisations to understand the competitions and develop and adopt suitable strategies to meet the challenge. As TQM helps to understand the pulse of the customer and thus the market, it gives an edge to the organisation to meet the competition.

7. It helps to develop good procedures for communication and acknowledging good work. Improper procedure and inadequate communication are yet another bane of many organisations, which result in misunderstanding, confusion, low productivity, duplication of efforts, poor quality, low morale and so on. TQM brings together members of various related sections, departments and different levels of management thereby providing an effective vehicle of communication and interaction.

8. It helps to review the process needed to develop the strategy of never ending improvement. Quality improvement efforts cannot be restricted to any time period. They nee to be continuous to meet the dynamic challenges. TQM emphasises on a continuous and periodic review so as to make the required changes.

9. The benefits derived by the organisations, therefore, are many and multi-faceted. Many of these can be measured in quantitative terms. However, the intangible benefits, which include enrichment of the quality of the worklife and many more are not quantifiable. At the same time, it has to be established whether they do occur or not in order to prove or disprove the efficacy of the concept. This can be assessed by a well-planned research project or by carrying out an opinion survey periodically. The tangible and intangible benefits of TQM are as presented ADVANTAGES OF TOTAL QUALITY MANAGEMENT.

TQM is a collaborative system. It can be conceptualized as a network of processes and activities through which various people in the organization can see different aspects of a problem and can constructively explore their own limited vision of what is possible.

TQM thus is an interdepartmental and inter organizational effort to address problems of improvement.

TQM provides a foundation for moving towards answering the questions of why, how and with what consequences people participate in multiple dimensional problem solving.

TQM does not rely solely on the chain of command; it develops multi-channel interactive networks throughout the organizations.


TOTALQUALITYMANAGEMENTTQM is essential to establish cooperative links within the organization that can span the various

gaps among people to enable coordinate the action.

TQM can be viewed to play a transformational role within the organization. Transformational changes occur only when hard issues like budget, manufacturing marketing, disturbing and so on are blended with soft issues like values, culture, vision, leadership style, innovative behavior and so on.

THE ISSUES ARE ( MAY BE USE FOR PRESENTATION)

HOW DO WE GET EVERYBODY TO WORK TOGETHER ( Team Player) HOW DO WE MAINTIN THEIR INVOLVEMNT (Interest/Motivation) HOW DO WE MAKE THEM CONTIBUTE THEIR BEST (10% stretch game) HOW DO WE CREATE THEIR SATISFACTION HOW DO WE CONTINUOUSLY IMPROVE Problems/Issues

Situation

ABC bank is one of the biggest banks in Asia established 85 years back. Recently it was faced with some problems such as increased. Customer complaints, inconsistent service at the front counter, unbalanced investment resulting in reduced profit margins and a significant drop in customers.

Solution:

The Organization, therefore, set up a quality improvement team which took up a Customer Care program to bring about a change in managing customer service. The program primarily focused on trouble shooting, customer service improvement and improving the management and staff relations. In building quality this, the groups were composed of people from all levels and no status titles were assigned. Groups were set up keeping in view the group dynamics and small group bonding principles in mind. The workshops were arranged for the groups focusing on a super ordinate goal to put the Customer First as a philosophy.

The workshops opened with personal value searching session so as to create a motive for action. To further the value motive the prospects of personal growth were reviewed. A congruence between personal value and organizational goal was established. The workshop programmes emphasized on creative problem solving approach to permit innovation, and challenge the existing cultural norms. During the workshops the culture, work environment and attitudes towards customers in the banking section were discussed openly, resulting in developing a sense of trust and commitment amongst participants.

Through these workshops a network of committed people was established across the branches. To promote commitment and strong bonding, the rewards were given. The process percolated downwards and the cultural change upwards. Thus, by stepping outside the system and focusing on motivation and reward, the organization brought about a necessary cultural change to keep the satisfaction of the customer as a primary goal of all the employee.

TQM FAILURES CASE EXAMPLE:

Mr. Pandit, President of G.T. Electronics, read a lot about the TQM. He instructed the subordinates to arrange a meeting with all department heads and plan to implement TQM in G.T.


TOTALQUALITYMANAGEMENTElectronics. Mr. Pandit personally addressed the meeting and subsequently also wrote an enthusiastic article about TQM in the company newsletter. He sent the top managers for TQM training programs and declared that the TQM be initiated. However, he himself later got involved with joint ventures in Europe. The TQM program was forgotten. When he returned to the country. After few months, he found that very few people showed interest in TQM. The earlier initiative and interest waned out because of the CEOs lack of convication.

Academic resources

International Journal of Productivity and Quality Management, ISSN 1746-6474, Inderscience

International Journal of Quality & Reliability Management, ISSN: 0265-671X, Emerald Publishing Group

OUT OF THE CRISES-WRITTEN BY EDWARDS W. DEMINGS

THE TOYOTA WAY -WRITTEN BY STEPHEN R. COVEY

CASE NO 1.

COMPANYS NAME

MAHINDRA & MAHINDRA GROUP. [Farm Equipment Sector]

Mission Statement

Our core values are influenced by our past, tempered by our present and are designed to shape our future. They are an amalgam of what we have been, what we are and what we want to be.

These values are the compass that will guide our actions, both personal and corporate. They are:

Good corporate citizenshipAs in the past, we will continue to seek long term success that is in alignment with our country's needs. We will do this without compromising on ethical business standards. ProfessionalismWe have always sought the best people and given them the freedom and the opportunity to grow. We will continue to do so. We will support innovation and well-reasoned risk-taking, but will demand performance. Customer first We exist and prosper only because of our customers. We will respond to their changing needs and expectations speedily, courteously and effectively. Quality focusQuality is the key to delivering value for money to our customers. We will make quality a driving value in our work, in our products and in our interactions with others. We will do it "first time right".

Dignity of the individualWe value individual dignity, uphold the right to express disagreement and respect the time and efforts of others. Through our actions, we nurture fairness, trust and transparency.

Objective


TOTALQUALITYMANAGEMENTOur Core Purpose

Indians are second to none in the world. The Founders of our nation and of our company passionately believed this. We will prove them right by believing in ourselves and by making Mahindra & Mahindra Ltd. known worldwide for the quality, durability and reliability of its products and services.

Goals

1. The Core Purpose and Core Values of M & M

A. The Core Purpose

"The Indians are second to none in the World. The founders of our Nation and of our Company passionately believed this. We will prove them right by believing in ourselves and making Mahindra and Mahindra Ltd known Worldwide for Quality, Durability and reliability of its Products and Services".

B. The Core values

1. Good Corporate Citizenship 2. Professionalism 3. Customer First 4. Quality Focus 5. Dignity of the Individuals

2. M & M organization

Since 1994 M & M is organized into six Sectors, each a Strategic Business Unit, as Follows -

1. Automotive Sector 2. Farm Equipment Sector (FES) 3. Automotive Components Sector 4. Infrastructure Sector 5. Trade and Financial Sector 6. Telecom and Software Sector

INTROUDUCTION OF CO. & THEIR PRACTICES

The US $6.7 billion Mahindra Group is among the top 10 industrial houses in India. Mahindra & Mahindra is the only Indian company among the top tractor brands in the world. Mahindras Farm Equipment Sector has recently won the Japan Quality Medal, the only tractor company worldwide to be bestowed this honour. It also holds the distinction of being the only tractor company worldwide to win the Deming Prize. Mahindra is the market leader in multi-utility vehicles in India. It made a milestone entry into the passenger car segment with the Logan.


TOTALQUALITYMANAGEMENTThe Group has a leading presence in key sectors of the Indian economy, including the financial

services, trade and logistics, automotive components, information technology, after-market and infrastructure development.

With over 62 years of manufacturing experience, the Mahindra Group has built a strong base in technology, engineering, marketing and distribution which are key to its evolution as a customer-centric organization. The Group employs over 50,000 people and has several state-of-the-art facilities in India and overseas.

The Mahindra Group has ambitious global aspirations and has a presence on five continents. Mahindra products are today available on every continent except Antarctica. M&M has one tractor manufacturing plant in China, three assembly plants in the United States and one at Brisbane, Australia. It has made strategic acquisitions across the globe including Stokes Forgings (UK), Jeco Holding AG (Germany) and Schoneweiss & Co GmbH (Germany). Its global subsidiaries include Mahindra Europe Srl. based in Italy, Mahindra USA Inc. and Mahindra South Africa.

M&M has entered into partnerships with international companies like Renault SA, France, and International Truck and Engine Corporation, USA. The US based Reputation Institute recently ranked Mahindra among the top 10 Indian companies in its Global 200: The Worlds Best Corporate Reputations list.

Background/History of Co.

Foundation of organization

This company was founded by two Mahindra brothers - Jagdish Chandra and Kailash Chandra in the year 1945. Around this time, Independence for India was seen as a certainty and the National Leaders of that era had given a call to all Indians, especially to the youth, to contribute their best in the 'Building of a strong and self reliant Nation'. This had prompted the Mahindra brothers to leave their then existing professions and start this new venture.

Few groups can identify as closely with India's destiny and industrial progress as the Mahindra Group. In fact, Mahindra is like a microcosm of India. Both were born around the same time, had the same aspirations and both experienced the inevitable troughs

and crests in the journey towards their goals. And both continue to march on the path to progress and global recognition.

The birth of Mahindra & Mahindra began when K.C. Mahindra visited the United States of America as Chairman of the India Supply Mission. He met Barney Roos, inventor of the rugged 'general purpose vehicle' or Jeep and had a flash of inspiration: wouldn't a vehicle that had proved its invincibility on the battlefields of World War II be ideal for India's rugged terrain and its kutcha rural roads?



Swift action followed thought. The Mahindra brothers joined hands with a distinguished gentleman called Ghulam Mohammed. And, on October 2nd, 1945, Mahindra & Mohammed was set up as a franchise for assembling jeeps from Willys, USA.

Two years later, India became an independent nation and Mahindra & Mohammed changed its name to Mahindra & Mahindra. Ghulam Mohammed migrated to Pakistan post-partition and became the first Finance Minister of Pakistan.

Since then, Mahindra & Mahindra has grown steadily in size and stature and evolved into a Group that occupies a premier position in almost all key sectors of the economy. The Group's history is studded with milestones. Each one taking the Group forward. In fact, today, its total turnover is about 6 billion dollars.

These days, Mahindra is a group in a hurry, engaged in an ambitious, sustained and prolonged penetration into the global arena. Its spirit can be encapsulated in the words of the poet Robert Frost, a favourite of India's first Prime Minister, Pandit Jawaharlal Nehru:

"The woods are lovely, dark and deep,But I have promises to keep,And miles to go before I sleep, And miles to go before I sleep."

For Mahindra & Mahindra, this translates into many more milestones to be set up before it rests. If ever.

OTHER ACTIVITIES

Mr. Mahindra is the co-founder of the Harvard Business School Association of India, an association dedicated to the promotion of professional management in India. The association has grown substantially over the years.

He is Past President 2003-04 of the Confederation of Indian Industry and has also been President of the Automotive Research Association of India (ARAI).

Mr. Mahindra is a Director of The National Stock Exchange of India Limited appointed under the Public Representatives category.

He takes a keen interest in matters related to education and apart from being a Trustee of the K.C. Mahindra Education Trust, which provides scholarships to students, he is also on the Board of Governors of the Mahindra United World College of India.

Mr. Mahindra is the Founder Chairman of the Mumbai Festival, which was launched in January 2005. The event was the first comprehensive festival to celebrate the rich cultural diversity of the city.

He is the Co-Chairman of the International Council of the Asia Society, New York.

Mr. Mahindra is a Member of the following organisations:

1. Harvard Business School - AsiaPacific Advisory Board


TOTALQUALITYMANAGEMENT2. Harvard Business School - Member of the Board of Deans Advisors 3. Harvard University Asia Centre - Advisory Committee 4. Asia Business Council 5. National Sports Development Fund (NSDF), Government of India Council and Executive

Committee 6. The Nehru Centre, Mumbai - Executive Committee 7. National Council of Applied Economic Research 8. National Institute of Bank Management, Pune Governing Board

How are the organizations implements Quality Management.

Title: - 1. QUALITY MANAGEMENT SYSTEMS

1.1. General Requirements

FES has established and documented a Quality Management System which is implemented, maintained and continuously improved for effectiveness in accordance with requirements of International Standards ISO / TS - 16949:2002 and Japan Quality Medal Guidelines.

For this the organization has identified the following processes for application throughout the organization. The list of processes is as follows:-

LIST OF PROCESSES IN FES

S #

Process Number Main Process Process Owner

1 Business Planning1 1a Strategy Formulation Strategic Planning Head

2 1b Annual President Policy formulation Strategic Planning Head

3 1c Key Assumptions Documentation and Tracking

Strategic Planning Head

2 Human Resource Management (Officers)

4 2a Capability Building & Training HR & PMS Head5 2b Staffing & Compensation HR & PMS Head6 2c Employee Care HR & PMS Head7 2d Improving Employee Morale HR & PMS Head8 2e Policy Deployment HR & PMS Head9 2f Performance Management HR & PMS Head


TOTALQUALITYMANAGEMENTS #


3 Sales & Customer Operations10 3a Dealer Appointment Process Channel Development Head11 3b Dealer Planning, Monitoring and

RecognitionChannel Development Head

12 3c Service Provision Process Customer Care Operations Head13 3d Spares Management Process Customer Care Operations Head14 3e Product Launch PMMS Head15 3f Sales process (Mahindra Sales System

- MSS)Special Projects, Sales Zonal Heads

16 3g Customer Satisfaction Measurement Process

Customer Care Operations Head

17 3h Marketing Planning Process PMIS Head

4 International Operations18 4a Identification of New Market Regional Head International

Operations19 4b Appointment of Distributors Regional Head International

Operations20 4c Sales Management Regional Head International

Operations21 4d Product Complaint resolution Process Regional Head International

Operations22 4e Spares Management Regional Head International

Operations

5 Product Quality23 5a Field Quality Assurance Head PQPU- Field Quality 24 5b Supplier Quality Assurance Head PQPU- Supplier Quality25 5c In-house Quality Assurance Head PQPU- In-House Quality26 5d IQS Head PQPU- In-House Quality27 5e Material Testing Head PQPU- Laboratory28 5f Improving DR Preparedness Head PQPU- NPD29 5g Receipt Inspection Head PQPU Receipt Inspection 6 Manufacturing

30 6a Manufacturing Process Head- Manufacturing31 6b Supply Module Process Head- SCPC32 6c Manufacturing Support (Maintenance) Head- Manufacturing33 6d Manufacturing Engineering Support Head- Manufacturing34 6e MSA Head- Manufacturing35 6f Production Planning Head- SCPC




36 6g Logistic Processes (Inbound and Stock yard)

Head- SCPC

37 7 Control of non conforming products

Head- PQPU, Manufacturing, SCPC,CDMM, PDRDS

8 Human Resource -Cell Members38 8a Competency Building & Training Head- ER & D39 8b ER & D services to employees Head- ER & D40 8c Improving Employee Moral Head- ER & D

41 9a Safety Head- Central Maintenance & Safety

42 9b Central Maintenance Head- Central Maintenance & Safety

43 9c Statutory Compliance Head- ER & D, Central Maintenance & Safety

10 New Product Development44 10a MNPD- Integration process Head- Horizons.45 10b Project Management Head - Program Office46 10c CAE Head- CAE47 10d Testing & Evaluation Head- T & E48 10e Technology Support (Aggregates) Head- Technology49 10f Product Improvement Head - Product Improvement

11 Component Development50 11a New Component Development Head- Component Development51 11b Target costing Head- Component Development52 11c Supplier Quality Assurance and

Handover of componentsHead- Component Development

12 Manufacturing Engineering 53 12a Capital Resource planning &

Installation processHead- ME

54 12b Calibration Head Strategic Manufacturing55 12c Tooling Management Head- Strategic Manufacturing56 12d New Product Productionizing Head- ME57 12e Tooling Design Head- ME58 12f Strategic Manufacturing Head Strategic manufacturing




13 SSBU59 13a Supplier Up gradation Head- Supplier Up gradation

14 Business Excellence60 14a Continuous Improvement process Head- Business Excellence61 14b Control of documents process Head- Business Excellence62 14c Control of Records Head- Business Excellence63 14d Establishing, Implementing &

continually improving the QMSHead- Business Excellence

64 15 Purchase of Indirect Material Head- Capital Purchase

16 Information Technology65 16a Provision of IT resources Head IT66 16b Helpdesk - IT services Head IT67 16c Software Development Head IT68 16d Asset Management Head IT69 17 ER Implementation process (Cross Functional Team )

The sequence of activities in each process is shown in the process flow chart with references of respective procedures, formats and work instructions. The Interrelationships between processes are shown in the attached Annexure.

Criteria and methods needed to ensure both the operation and control of these processes are specified in the process matrix and flow diagrams of the processes, procedures, formats etc. wherever applicable. These are available in the documented system.

Resources are made available to support all the processes and procedures through the determination of required infrastructure for each of the processes.

Monitoring, Measurement and analysis of Main processes is done through various measures as listed in Policy Deployment Documents of the ELs, PULs and PGLs & Sub Processes will be monitored. All processes shall be reviewed once in a year in the month of April and modified if necessary.

Actions are implemented to achieve planned results and continual improvements of these processes. The outsourced processes under the scope of this manual are- The Strategic Sourcing Business Unit

(SSBU) processes. The supplier is selected by this unit and is formally approved for supplying components to FES which suffice the delivery and quality requirements.

However, the inter phase of SSBU with various PUs at FES is as follows -- The PQPU is responsible for monitoring & improving supplier Quality and is responsible

for Quality Assurance of existing Supplier Component combination. Process No.5b.- Supply Modules from SCPC PU are responsible for procurement of material from the

suppliers approved by SSBU with SOB and Pricing guidelines. The order is put on supplier as per production plan and market requirements. Supplier Module is responsible for monitoring and improving the delivery schedule adherence performance of the suppliers. Process No.6b.


TOTALQUALITYMANAGEMENT- CD PU is responsible for development of new components at suppliers and Quality

Assurance of such suppliers. Once Quality Assured, those suppliers are handed over to Supplier Modules for regular buying. Process No.11c.

- The Supplier Up gradation PU from SSBU is responsible for providing support to FES suppliers for up gradation of their quality systems and improves QCD performance. Process No.13a.

1.2. Documentation requirements

1.2.1 General -

The quality management documentation includes-

a. Documented statement of Quality Policy b. Quality System Manual (Level 1) c. Documented Processes/ procedures required by International Standard ISO/TS 16949:2002

(Level 2 documents)

d. Documents like Standard operating procedures, Work Instructions etc required for ensuring effective planning, operation and control of processes by those, who actually implement the processes (Level 3 documents)

e. Records required for monitoring the results of the processes

1 .2.2 Quality Policy



1.2.3 Scope of Documentation


TOTALQUALITYMANAGEMENTThe documentation methodology is as follows-

Mahindra & Mahindra Ltd; FES has prepared, documented and implemented procedures and processes in consistence with requirements of ISO/TS-16949:2002. The procedures make reference to other documents.

The Manual includes the Policy and describes the Quality Management System, of Mahindra & Mahindra Ltd; FES. The scope of the documented system is Design, Manufacturing, Marketing and Servicing of Tractors, Aggregates & Components.

It also consists of organization structure, responsibilities and authorities of the management personnel with executive responsibility.

The manual briefly explains methodology adopted for meeting the requirements of the various clauses of ISO/TS 16949:2002 QMS, and also includes some broad procedures.

References of critical departmental procedures are given in the Manual at appropriate places in each section.

The procedures, flow charts and listing of processes is applicable to each area. These are decision oriented, management activities. These documents give the information related to the sequence of activities, control points and different agencies involved at different stages of a process.

Control Plans, SOPs and Work Instructions are working documents and these include guidelines for performing a task/ set of activities, which are repetitive in nature.

1.2.3.1 The Document control methodology is as follows

1. The Management Representative is responsible for documenting and maintaining this manual as well as the policy document which is signed and approved by the Chief Operating Officer. The Management Representative is also responsible for maintaining, revising and updating the various management systems standards.

2. Management Representative is responsible for maintaining and improvement of Quality Management Systems at FES. The various external national & international standards for Product Design and materials are controlled by BM group from Technology PU at PDRDS.

3. Approval mechanism for various types of documents is as follows


TOTALQUALITYMANAGEMENTSr.N

o. Level of Document Approval Authority

1 Quality Manual - Level I MR office2 Common Procedures and Formats MR office3 Process Flow Diagram & Process maps Respective Process Owner

4 Work Instructions / SOPs PGL/Manager of respective Processes

5 Formats PGL/Manager of respective Processes

The numbering of the documents shall be as follows:-

Sr. No. Level of Document Methodology

1 Quality Manual Level I as per clause numbers

2 Procedures Common Procedure - QAP14.1 Common MQS Manual - C._ Supplier QA Manual - PQ/S

3Process Flow

Diagram & Process maps

Main Process no. code. - *Sub Process no code .- *a, * b.*c --(*-> Ref. Table X for those nos.)

4 Work Instructions / SOPsQAP AA.1,----

(AA stands for sub process no code)

5 FormatsCommon Formats:- TQM 1/----

Other Formats: - To be decided by respective process owner. Generally starts with PU name abbreviation.

The above documents are available in the companys ERP System with Read Access to all and the new documents shall be numbered by the next serial no. for all types of documents.Also regarding documentation the following shall be ensured-

1. The changes and current revision status of documents will be identified as per the document control procedure.

2. The relevant version of applicable documents shall be made available at appropriate points of use. 3. The documents shall be ensured to be legible and readily identifiable. 4. The identification and distribution of documents of external origin is ensured by KM and BM

group of Technology PU from PDRDS. 5. Obsolete documents shall be destroyed and suitably identified if required to be retained for any

purpose.

Title: - 2. MANAGEMENT RESPONSIBILITY

2.1. Management Commitment Top Management i.e. the President and Chief Operating Officer and the respective ELs and PULs

along with respective PGLs directly or indirectly through the PU Managers provide evidence of its commitment to the development and implementation of the quality, system and continually improving its effectiveness through the process of Policy D