Aiou MBA: Total Quality Management

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?

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.

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.

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.

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.

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.

Total quality management is an intensive long-term effort to transform all parts of the organization in order to produce the best product and service possible to meet customer needs. TQM is a business management philosophy, which recognizes that customer needs and business goals are inseparable.TQM is an intensive, long-term effort directed at creation and maintenance of high standard of product quality and services expected by customers. As such, it can operate as a major influence in developing the culture and processes of the organization. The object is significantly to increase the awareness of all employees that quality is vital to the organization’s success and their future. The business must be transformed into an entity that exists to deliver value to customers by satisfying their needs.

Elements of TQM

Commitment and leadership of senior management.
Focus on the customer.
Planning and organization
Prevention rather than detection of defects.
Quality measurement
Using quality management tools and techniques.
Bench marking
Education and training.
Involvement----workers participation in management.
Synergy of teams
Quality measurement and feedback.

Need & Importance/ Advantages of TQM

Improving customer satisfaction
Enhancing quality
Reduction in waste
Reduction in inventory
Improving productivity
Reducing product development time.
Flexibility
Motivates human resource
Enhances competitiveness.

The Six Steps to TQM

Demonstrate top management commitment
Establish the current state of quality
Determine the quality strategies
Educate management in TQM
Raise quality awareness everywhere
Institute never-ending improvement

Quality Circles

Quality circle is technique for improving quality based on Japanese quality control method. Quality circle is the management style that involves workers in quality analysis and quality improvement. The concept of this is originated in Japan in the early 1960.
Quality circle is a voluntary group of workers who have a shared area of responsibility. They meet together weekly to discuss, analyze and propose solutions to quality problems. They are taught group communication process, quality strategies and measurement and problem-analysis technique. They are encouraged to draw on the resources of the company’s management and technical personnel to help them to solve problems. In fact they take responsibility for solve quality problems and they generate and evaluate their own feedback. In this way they are also responsible for quality of communication. The supervisor becomes the leader in the circle and is trained to work as a group member and not as a boss.
In short, Quality Circle is a small group of employees doing the similar work, voluntarily meet for an hour each week to discuss their quality problems, investigate causes, recommend solutions and take corrective actions.

Steps in Quality Circle

Identification of problems
Prioritization
Discussion and investigation
Solution
Action if authorized
Presentation to manager
Decision and implementation

KAIZEN ( P-D-C-A )

Kaizen is a form of quality circle based on the cycle of planning, doing, checking and actioning.
The concept of continuous improvement is based on the assumption that continually striving to reach higher and higher standard in every part of organization will provide a series of incremental gains that will build a superior performance. In Japan, this process is called KAIZEN, kai means change and zen means good or for better i.e. change for better.

KAIZEN Principles

Focus on customer
Make improvement continuously
Acknowledge problems openly
Promote openness
Create work team
Manage projects through cross-functional teams
Maintain right relationship process
Develop self-discipline
Inform every employee.
Enable every employee.

Quality Control

Quality control is the continuing process of evaluating performance, comparing the performance with the laid down standard and taking corrective action when necessary.

Two types of quality control

On-line quality control-----during the production cycle of a product.
Off-line quality control-----conducting externally to the production process i.e. improving the product design, control on incoming materials and special process studies.

Objectives of Quality Control

To assess the quality at various stages of the production process.
It helps in ensuring that production process operates by desired standards.
To increase the standard of the goods.
To reduce the cost of inspection.
To minimize the waste.
Customer satisfaction.

TQM

Basic Principles of Total Quality Management (TQM)