TOTAL QUALITY MANAGEMENT

BY

EMMANUEL NELSON BASSEY

A TERM PAPER WRITEN IN PARTIAL FULFILLMENT FOR THE

COURSE PRODUCTION MANAGEMENT

HND 11, BUSINESS ADMINISTRATION, DEPARTMENT OF BUSINESS

STUDIES. AKWA IBOM STATE POLYTECHNIC.

IKOT OSURUA- IKOT EKPENE.

AKWA IBOM STATE.

JULY 2009

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ABSTRACT

Today's competitive market, in almost every category of products and services, is

characterised by accelerating changes, innovation, and massive amounts of new

information. Much of this rapid evolution in markets is fueled by changing customer

needs. Significant customer behavior and market changes happen almost overnight.

Changes in market preference or technology, which used to take years, may now

take place in a few months.

As the pace of change accelerates, it becomes more difficult to maintain stable

relationships with suppliers, customers, brokers, distributors, and even your own

company personnel. "Putting out fires" and reacting to new emergencies is

unfortunately the norm for many large and small companies caught in the whirlpool

of technological change.

Total Quality Management (TQM) is a business management strategy aimed at

embedding awareness of quality in all organizational processes. There are several

keys to a successful TQM program for business organisation:

Quality work and customer satisfaction must be a commitment of all

employees.

Improving quality and customer satisfaction must also be a commitment of all

employees.

Every company activity must incorporate quality and customer satisfaction,

including all communications with customers and suppliers.

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It doesn't have to cost more to make quality and customer satisfaction your

priority.

Significant changes may be required to make quality and customer

satisfaction improvements.

Small advantages in all company functions can set your quality and customer

satisfaction apart from the competition.

In this term paper, the writer began with introduction, followed with the review of the

related literature on the relevant materials on the subject matter. The summary and

conclusion brought the write-up the end.

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TABLE OF CONTENTS

Abstract….2

Table of content…..4

Unit 1……..5

Introduction…5

Definition………5

Origins……7

Customer-driven quality…..9

Continuous improvement…….10

Fast response……..11

Unit 2…….14

Literature review……14

Total quality management……14

TQM as a foundation…….16

Ten steps to total quality management…….17

Key to quality…….18

Six questions six graphs for planning a change….19

Company philosophy ….21

Quality methods…..24

Unit 3 ……..25

Summary…..25

Unit 4…….26

Conclusion…..26

References……27

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UNIT 1

INTRODUCTION

Total Quality Management is an approach to the art of management that originated

in Japanese industry in the 1950's and has become steadily more popular in the

West since the early 1980's.

1.1 DEFINITION

Total Quality Management is the organization-wide management of quality.

Management consists of planning, organizing, directing, control, and

assurance. Total quality is called total because it consists of two qualities:

quality of return to satisfy the needs of the shareholders, or quality of

products.

As defined by the International Organization for Standardization (ISO):

"TQM is a management approach for an organization, centered on quality,

based on the participation of all its members and aiming at long-term success

through customer satisfaction, and benefits to all members of the organization

and to society." ISO 8402:1994

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One major aim is to reduce variation from every process so that greater

consistency of effort is obtained. (Royse, D., Thyer, B., Padgett D., & Logan

T., 2006)

In Japan, TQM comprises four process steps, namely:

1. Kaizen – Focuses on "Continuous Process Improvement", to make processes

visible, repeatable and measurable.

2. Atarimae Hinshitsu – The idea that "things will work as they are supposed to"

(for example, a pen will write).

3. Kansei – Examining the way the user applies the product leads to

improvement in the product itself.

4. Miryokuteki Hinshitsu – The idea that "things should have an aesthetic quality"

(for example, a pen will write in a way that is pleasing to the writer).

TQM requires that the company maintain this quality standard in all aspects of

its business. This requires ensuring that things are done right the first time

and that defects and waste are eliminated from operations.

Total Quality Management continues to evolve in the form of the Criteria for

Performance Excellence which was first published in 1988. The criteria

provide the basis for the Baldrige National Quality Program (BNQP) that is

administered by the National Institute of Standards and Technology (NIST).

Organizations benchmark against the criteria to assess how well their actions

are aligned with their strategies. Results are examined to determine the

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effectiveness of their approaches and deployment of these strategies. Dr.

Juran once stated that the Criteria for Performance Excellence is the

embodiment of those philosophies and practices we call TQM.

1.2 ORIGINS

The origin of the expression Total Quality Management is unclear. Bill Creech

claims to have coined the phrase in his book The Five Pillars of TQM[3],

comparing the functionally centralised approach to organisation (with examples

from America) with the team-oriented, decentralised approach pioneered in

Japan after World War II.

"Total Quality Control" was the key concept of Armand Feigenbaum's 1951

book, Quality Control: Principles, Practice, and Administration[4]. In a chapter

titled "Total Quality Control" Feigenbaum grabs on to an idea that sparked

many scholars' interest in the following decades. The expression Total Quality

Control existed together with the Japanese expression "Company Wide Quality

Control" (CWQC) and the differences between the two expressions were

unclear. Major influencers for both expressions were W. Edwards Deming,

Joseph Juran, Philip B. Crosby, and Kaoru Ishikawa, known as the big four.

The expression Total Quality Management started to appear in the 1980s and

there are two theories of its origin:

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One theory is that Total Quality Management was created as a

misinterpretation from Japanese to English since no difference exists between

the words "control" and "management" in Japanese. [5]. According to William

Golomski (American quality scholar and consultant, 1924-2002) TQM was first

mentioned by Koji Kobayashi at NEC (Nippon Electrical Company) in his

speech when he received the Deming Prize in 1974.

The American Society for Quality says that the term Total Quality Management

was used by the U.S. Naval Air Systems Command in 1984 to describe its

Japanese-style management approach to quality improvement since they did

not like the word control in Total Quality Control. The word management should

then have been suggested by one of the employees, Nancy Warren.[7][8] This is

consistent with the story that the United States Navy Personnel Research and

Development Center began researching the use of statistical process control

(SPC), the work of Juran, Crosby, and Ishikawa, and the philosophy of W.

Edwards Deming to make performance improvements in 1984. This approach

was first tested at the North Island Naval Aviation Depot.

Total Quality is a description of the culture, attitude and organization of a

company that aims to provide, and continue to provide, its customers with

products and services that satisfy their needs. The culture requires quality in all

aspects of the company's operations, with things being done right first time, and

defects and waste eradicated from operations.

Many companies have difficulties in implementing TQM. Surveys by consulting

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firms have found that only 20-36% of companies that have undertaken TQM

have achieved either significant or even tangible improvements in quality,

productivity, competitiveness or financial return. As a result many people are

sceptical about TQM. However, when you look at successful companies you

find a much higher percentage of successful TQM implementation.

Some useful messages from results of TQM implementations:

if you want to be a first-rate company, don't focus on the second-rate

companies who can't handle TQM, look at the world-class companies that

have adopted it

the most effective way to spend TQM introduction funds is by training top

management, people involved in new product development, and people

involved with customers

Important aspects of TQM include customer-driven quality, top management

leadership and commitment, continuous improvement, fast response, actions

based on facts, employee participation, and a TQM culture.

1.3 Customer-driven quality. TQM has a customer-first orientation. The

customer, not internal activities and constraints, comes first. Customer

satisfaction is seen as the company's highest priority. The company

believes it will only be successful if customers are satisfied. The TQM

company is sensitive to customer requirements and responds rapidly to

them. In the TQM context, `being sensitive to customer requirements' goes

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beyond defect and error reduction, and merely meeting specifications or

reducing customer complaints. The concept of requirements is expanded to

take in not only product and service attributes that meet basic

requirements, but also those that enhance and differentiate them for

competitive advantage.

Each part of the company is involved in Total Quality, operating as a

customer to some functions and as a supplier to others. The Engineering

Department is a supplier to downstream functions such as Manufacturing

and Field Service, and has to treat these internal customers with the same

sensitivity and responsiveness as it would external customers.

1.4 TQM leadership from top management. TQM is a way of life for a company.

It has to be introduced and led by top management. This is a key point.

Attempts to implement TQM often fail because top management doesn't lead

and get committed - instead it delegates and pays lip service. Commitment

and personal involvement is required from top management in creating and

deploying clear quality values and goals consistent with the objectives of the

company, and in creating and deploying well defined systems, methods and

performance measures for achieving those goals. These systems and

methods guide all quality activities and encourage participation by all

employees. The development and use of performance indicators is linked,

directly or indirectly, to customer requirements and satisfaction, and to

management and employee remuneration.

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1.5 Continuous improvement. Continuous improvement of all operations and

activities is at the heart of TQM. Once it is recognized that customer

satisfaction can only be obtained by providing a high-quality product,

continuous improvement of the quality of the product is seen as the only way

to maintain a high level of customer satisfaction. As well as recognizing the

link between product quality and customer satisfaction, TQM also recognizes

that product quality is the result of process quality. As a result, there is a focus

on continuous improvement of the company's processes. This will lead to an

improvement in process quality. In turn this will lead to an improvement in

product quality, and to an increase in customer satisfaction. Improvement

cycles are encouraged for all the company's activities such as product

development, use of EDM/PDM, and the way customer relationships are

managed. This implies that all activities include measurement and monitoring

of cycle time and responsiveness as a basis for seeking opportunities for

improvement.

Elimination of waste is a major component of the continuous improvement

approach. There is also a strong emphasis on prevention rather than

detection, and an emphasis on quality at the design stage. The customer-

driven approach helps to prevent errors and achieve defect-free production.

When problems do occur within the product development process, they are

generally discovered and resolved before they can get to the next internal

customer.

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1.6 Fast response. To achieve customer satisfaction, the company has to

respond rapidly to customer needs. This implies short product and service

introduction cycles. These can be achieved with customer-driven and

process-oriented product development because the resulting simplicity and

efficiency greatly reduce the time involved. Simplicity is gained through

concurrent product and process development. Efficiencies are realized from

the elimination of non-value-adding effort such as re-design. The result is a

dramatic improvement in the elapsed time from product concept to first

shipment.

1.7 Actions based on facts. The statistical analysis of engineering and

manufacturing facts is an important part of TQM. Facts and analysis provide

the basis for planning, review and performance tracking, improvement of

operations, and comparison of performance with competitors. The TQM

approach is based on the use of objective data, and provides a rational rather

than an emotional basis for decision making. The statistical approach to

process management in both engineering and manufacturing recognizes that

most problems are system-related, and are not caused by particular

employees. In practice, data is collected and put in the hands of the people

who are in the best position to analyze it and then take the appropriate action

to reduce costs and prevent non-conformance. Usually these people are not

managers but workers in the process. If the right information is not available,

then the analysis, whether it be of shop floor data, or engineering test results,

can't take place, errors can't be identified, and so errors can't be corrected.

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1.8 Employee participation. A successful TQM environment requires a

committed and well-trained work force that participates fully in quality

improvement activities. Such participation is reinforced by reward and

recognition systems which emphasize the achievement of quality objectives.

On-going education and training of all employees supports the drive for

quality. Employees are encouraged to take more responsibility, communicate

more effectively, act creatively, and innovate. As people behave the way they

are measured and remunerated, TQM links remuneration to customer

satisfaction metrics.

1.10 A TQM culture. It's not easy to introduce TQM. An open, cooperative culture

has to be created by management. Employees have to be made to feel that

they are responsible for customer satisfaction. They are not going to feel this

if they are excluded from the development of visions, strategies, and plans.

It's important they participate in these activities. They are unlikely to behave in

a responsible way if they see management behaving irresponsibly - saying

one thing and doing the opposite.

1.11 Product development in a TQM environment. Product development in a

TQM environment is very different to product development in a non-TQM

environment. Without a TQM approach, product development is usually

carried on in a conflictual atmosphere where each department acts

independently. Short-term results drive behavior so scrap, changes, work-

arounds, waste, and rework are normal practice. Management focuses on

supervising individuals, and fire-fighting is necessary and rewarded.

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Product development in a TQM environment is customer-driven and focused

on quality. Teams are process-oriented, and interact with their internal

customers to deliver the required results. Management's focus is on

controlling the overall process, and rewarding teamwork.

UNIT 2

LITERATURE REVIEW

The latest changes coming up for the ISO 9001:2000 standard’s "Process

Model" seem to complete the embodiment. TQM is the concept that quality

can be managed and that it is a process. The following information is provided

to give an understanding of the key elements of this process.

Total Quality Management (TQM)

Total = Quality involves everyone and all activities in the company.

Quality = Conformance to Requirements (Meeting Customer Requirements).

Management = Quality can and must be managed.

TQM = A process for managing quality; it must be a continuous way of life; a

philosophy of perpetual improvement in everything we do.

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At its core, Total Quality Management (TQM) is a management approach to

long-term success through customer satisfaction.

In a TQM effort, all members of an organization participate in improving

processes, products, services and the culture in which they work.

The methods for implementing this approach come from the teachings of such

quality leaders as Philip B. Crosby, W. Edwards Deming, Armand V.

Feigenbaum, Kaoru Ishikawa and Joseph M. Juran.

A core concept in implementing TQM is Deming’s 14 points, a set of management

practices to help companies increase their quality and productivity:

1. Create constancy of purpose for improving products and services.

2. Adopt the new philosophy.

3. Cease dependence on inspection to achieve quality.

4. End the practice of awarding business on price alone; instead, minimize total

cost by working with a single supplier.

5. Improve constantly and forever every process for planning, production and

service.

6. Institute training on the job.

7. Adopt and institute leadership.

8. Drive out fear.

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9. Break down barriers between staff areas.

10.Eliminate slogans, exhortations and targets for the workforce.

11.Eliminate numerical quotas for the workforce and numerical goals for

management.

12.Remove barriers that rob people of pride of workmanship, and eliminate the

annual rating or merit system.

13. Institute a vigorous program of education and self-improvement for everyone.

14.Put everybody in the company to work accomplishing the transformation.

The term “Total Quality Management” has lost favor in the United States in recent

years: “Quality management” is commonly substituted. “Total Quality

Management,” however, is still used extensively in Europe.

2.1 TQM COMPARED TO ISO 9001

ISO 9000 is a Quality System Management Standard.  TQM is a philosophy

of perpetual improvement.  The ISO Quality Standard sets in place a system

to deploy policy and verifiable objectives.  An ISO implementation is a basis

for a Total Quality Management implementation. Where there is an ISO

system, about 75 percent of the steps are in place for TQM.  The

requirements for TQM can be considered ISO plus.  Another aspect relating

to the ISO Standard is that the proposed changes for the next revision (1999)

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will contain customer satisfaction and measurement requirements.  In short,

implementing TQM is being proactive concerning quality rather than reactive.

2.2 TQM AS A FOUNDATION

TQM is the foundation for activities which include;

Meeting Customer Requirements

Reducing Development Cycle Times

Just In Time/Demand Flow Manufacturing

Improvement Teams

Reducing Product and Service Costs

Improving Administrative Systems Training

2.3 TEN STEPS TO TOTAL QUALITY MANAGEMENT (TQM)

The Ten Steps to TQM are as follows:

1. Pursue New Strategic Thinking

2. Know your Customers

3. Set True Customer Requirements

4. Concentrate on Prevention, Not Correction

5. Reduce Chronic Waste

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6. Pursue a Continuous Improvement Strategy

7. Use Structured Methodology for Process Improvement

8. Reduce Variation

9. Use a Balanced Approach

10.Apply to All Functions

2.4 PROCESSES

Processes must be managed and improved!  This involves:

Defining the process

Measuring process performance (metrics)

Reviewing process performance

Identifying process shortcomings

Analyzing process problems

Making a process change

Measuring the effects of the process change

Communicating both ways between supervisor and user

2.5 KEY TO QUALITY

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The key to improving quality is to improve processes that define, produce and

support our products. All people work in processes.

People

Get processes "in control"

Work with other employees and managers to identify process problems and

eliminate them

Managers and/or Supervisors Work on Processes

Provide training and tool resources

Measure and review process performance (metrics)

Improve process performance with the help of those who use the process

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2.6 PLANNING A CHANGE

TQM Process Improvement and Problem Solving Sequence

PLAN

(PLAN A CHANGE)

DO

(IMPLEMENT THE CHANGE)

CHECK

(OBSERVE THE EFFECTS)

ACTION(EMBED THE

FIX INTO THE PROCESS

FOR GOOD)DEFINE

THE PROBLEM

IDENTIFY POSSIBLE

CAUSES

EVALUATE POSSIBLE

CAUSES

MAKE A

CHANGE

TEST THE

CHANGE

TAKE PERMANENT

ACTION1. Recognize that what you are doing is a "PROCESS"

2. Identify the commodity being processed.- Process Inference

3. Define some measurable characteristics

6. "BRAINSTORM" what is causing the problem.7. Determine what past data shows.o Frequency distributiono Pareto chartso Control charts- sampling

8. Determine the relationship between cause and effecto Scatter diagramso Regression analysis 9. Determine what the process is doing now

10. Determine what change would help

Your knowledge of the process

Scatter diagrams

Control Charts- sampling

Pareto

11. Determine what change worked (confirmation).

Histograms Control charts

- sampling

Scatter diagrams

12. Ensure the fix is embedded in the process and that the resulting process is used.

Continue to monitor the process to ensure:

A. The problem is fixed for

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of value to the commodity.

4. Describe the "PROCESS"o Process Flow Analysis'so Flow chartso List of steps

5. Identify the "Big"  problemo Brainstormingo Checklistso Pareto analysis

o Control charts- sampling

analysis

****Then make the change.

good.

and

B. The process is good enough

o Control charts- sampling

****To ensure continuous improvement, return to step 5.

2.7 BASIC PRINCIPLES OF TOTAL QUALITY MANAGEMENT (TQM)

by Ron Kurtus (28 May 2001)

The basic principles for the Total Quality Management (TQM) philosophy of doing

business are to satisfy the customer, satisfy the supplier, and continuously improve

the business processes.

Questions you may have include:

How do you satisfy the customer?

Why should you satisfy the supplier?

What is continuous improvement?

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Satisfy the customer

The first and major TQM principle is to satisfy the customer--the person who pays for

the product or service. Customers want to get their money's worth from a product or

service they purchase.

Users

If the user of the product is different than the purchaser, then both the user and

customer must be satisfied, although the person who pays gets priority.

Company philosophy

A company that seeks to satisfy the customer by providing them value for what they

buy and the quality they expect will get more repeat business, referral business, and

reduced complaints and service expenses.

Some top companies not only provide quality products, but they also give extra

service to make their customers feel important and valued.

Internal customers

Within a company, a worker provides a product or service to his or her supervisors. If

the person has any influence on the wages the worker receives, that person can be

thought of as an internal customer. A worker should have the mind-set of satisfying

internal customers in order to keep his or her job and to get a raise or promotion.

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Chain of customers

Often in a company, there is a chain of customers, -each improving a product and

passing it along until it is finally sold to the external customer. Each worker must not

only seek to satisfy the immediate internal customer, but he or she must look up the

chain to try to satisfy the ultimate customer.

Satisfy the supplier

A second TQM principle is to satisfy the supplier, which is the person or organization

from whom you are purchasing goods or services.

External suppliers

A company must look to satisfy their external suppliers by providing them with clear

instructions and requirements and then paying them fairly and on time.

It is only in the company's best interest that its suppliers provide it with quality goods

or services, if the company hopes to provide quality goods or services to its external

customers.

Internal suppliers

A supervisor must try to keep his or her workers happy and productive by providing

good task instructions, the tools they need to do their job and good working

conditions. The supervisor must also reward the workers with praise and good pay.

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Get better work

The reason to do this is to get more productivity out of the workers, as well as to

keep the good workers. An effective supervisor with a good team of workers will 

certainly satisfy his or her internal customers.

Empower workers

One area of satisfying the internal suppler is by empowering the workers. This

means to allow them to make decisions on things that they can control. This not only

takes the burden off the supervisor, but it also motivates these internal suppliers to

do better work.

Continuous improvement

The third principle of TQM is continuous improvement. You can never be satisfied

with the method used, because there always can be improvements. Certainly, the

competition is improving, so it is very necessary to strive to keep ahead of the game.

Working smarter, not harder

Some companies have tried to improve by making employees work harder. This may

be counter-productive, especially if the process itself is flawed. For example, trying to

increase worker output on a defective machine may result in more defective parts.

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Examining the source of problems and delays and then improving them is what is

needed. Often the process has bottlenecks that are the real cause of the problem.

These must be removed.

Worker suggestions

Workers are often a source of continuous improvements. They can provide

suggestions on how to improve a process and eliminate waste or unnecessary work.

Quality methods

There are also many quality methods, such as just-in-time production, variability

reduction, and poka-yoke that can improve processes and reduce waste.

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UNIT 3

SUMMARY

The principles of Total Quality Management are to seek to satisfy the

external customer with quality goods and services, as well as your

company internal customers; to satisfy your external and internal

suppliers; and to continuously improve processes by working smarter and

using special quality methods.

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UNIT 4

CONCLUSION

Unlike other management approaches such as "Management by

Objectives (MBO), TQM manages by both objectives and the way in which

we achieve them. It is as important to follow the standards as it is to

achieve the results. Why? Let's say a business objective is achieved (such

as reduced costs) because of outside uncontrollable influences such as

the price of oil going down. Competitors will receive the same benefit and

so there will be no net market gain. If both process and results are

pursued, than the company might actually realize a better cost reduction

that the competition. Conversely, if the cost of oil goes up, all competitors

will be effected, but the TQM company will have offsetting gains from

following the business process as well.

In conclusion, every organization must be willing to adopt the Principles that:-

1. Quality can and must be managed.

2. Everyone has a customer and is a supplier.

3. Processes, not people are the problem.

4. Every employee is responsible for quality.

5. Problems must be prevented, not just fixed.

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6. Quality must be measured.

7. Quality improvements must be continuous.

8. The quality standard is defect free.

9. Goals are based on requirements, not negotiated.

10.Life cycle costs, not front end costs.

11.Management must be involved and lead.

12.Plan and organize for quality improvement.

REFERENCES

http://www.asq.org/learn-about-quality/total-quality-management/overview/overview.html

http://home.att.net/~iso9k1/tqm/tqm.html

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