Self Assessment Practice with a TQM Model (A Case Study)

Transcription

1 CASE STUDY Self Assessment Practice with a TQM Model (A Case Study) PAKISTAN INSTITUTE OF QUALITY CONTORL 304, 3 rd Floor, Eden Centre, 43 Jail Road Lahore Pakistan Ph: (+92 42) Fax: piqc@brain.net.pk; Web Site: Pakistan Institute of Quality Control (ICQI'1999) 1

2 SELF ASSESSMENT PRACTICE WITH A TQM MODEL (A CASE STUDY) by Major Nawar Khan The Corps of Electrical and Mechanical Engineering The Pakistan Army ABSTRACT Self assessment is a useful tool to determine the strengths and weaknesses of a company s practices on Total Quality Management (TQM). Such an assessment is conducted by an established organization in industrialized countries mostly against the criteria set of their National Quality Award (NQA) models. The self assessment case study presented in this paper is based on a newly developed International Quality Award (IQA) model. The model was used for the first time in a developing country like Pakistan for self assessment of an ISO 9002 certified manufacturing company. The analysis showed a clear indication of the strengths and weaknesses of the company for its TQM practices. Other companies are urged to follow this example of self assessment practice to find the strengths and weaknesses of their companies and plan for improvement projects. KEYWORDS: Self Assessment, ISO 9000 Certification, Quality Strengths and weaknesses, TQM Practices, NQA and IQA Models. 1. INTRODUCTION Self assessment practices against a TQM model is a relatively new concept in the less and non industrialized countries of the world. In the industrialized countries such an assessment is in practice since long. Dedicated well known public or private institutes like US Department of Commerce, National Institute of Standards and Technology (NIST) and American Society for Quality (ASQ) in United States of America (USA), European Foundation for Quality Management (EFQM) in Europe, British Quality Foundation (BQF) in United Kingdom (UK) and Union of Japanese Scientists and Engineers (JUSE) in Japan besides other numerous organizations conducts such assessment for companies on their request. A number of methods are available for such assessments. However, the facilitator lead workshop assessment method was found suitable for this case study. Self assessment of a company is mostly carried out against the criteria set of their national TQM award model. For example, self assessments in the USA are carried out against the Malcolm Baldrige National Quality Award (MBNQA) model. In Europe, such an assessment is conducted against the European Quality Award (EQA) model and in Japan against the Deming Prize (DP). The special features of the self assessment case study presented in this paper are: Pakistan Institute of Quality Control (ICQI'1999) 2

3 This self assessment was carried out against the criteria set of a newly developed International Quality Award (IQA) model; This was the first self assessment practice on the TQM IQA model in an ISO 9002 certified manufacturing company in Pakistan. The criteria used for selection of company to be assessed against the TQM IQA model was that it should be ISO 9000 certified. ISO 9000 certification was taken as an authenticated evidence of the TQM practices in that company as compared to a non certified company. In this case study, the company prepared a self assessment application against a questionnaire based on the criteria set of TQM IQA model. The application was then analyzed for its strengths and weaknesses of the TQM practices. The results achieved from the self assessment case study has confirmed the view point that ISO 9000 certification isa stepping stone for the TQM practices. Other companies are urged to follow such self assessment practice against the TQM IQA model and find out their strengths and weaknesses of quality practices. Improvement plans are then made to convert these weaknesses in quality practices into strengths of the company. 2. ASSESSMENT SCENARIO Assessment for national quality award competitions is being carried out by organized bodies with full technical (assessors and a panel of jurors) and administrative support. For the purpose of this research study, the complete self assessment case study was carried out by the author due to non existence of such organization in Pakistan. The study was carried out in a manufacturing company because it encompassed a majority of the business and manufacturing activities. This was in line with the work of HO and FUNG (1994, pp. 26) who stated that The manufacturing industry is chosen because it encompasses most business functions encountered in other industries like the service sector, public sector, education and training etc. Established sound Quality Management and Assurance Systems (QMS) in a company can be taken into consideration in order to obtain accurate and reliable results from the assessment. To meet this requirement, an ISO 9000 QMS certified manufacturing company was needed for the self assessment case study. ISO 9000 QMS certification indicate that sound QMS practices are already established in a company. ISO 9000 certification was also considered to be the foundation of a continuous improvement philosophy for TQM (KHAN and SHEIKH, 1997). WIELE et al. (1995 pp. 16) also presented a similar view on ISO 9000 QMS certification that ISO 9000 series registration is a good first step towards total quality management and registration helps to move the company forward in its self assessment against award model. WIELE et al. (1996 pp. 104) concluded, that in order to start the self assessment process, the organization should have a history of quality practices. They mentioned that an organization has to be fairly advanced to be able to start self assessment. HO and FUNG (1994 pp. 29) concluded that since ISO 9000 is an integral part of TQM, it is useful to record how a registered company use ISO 9000 as a stepping stone to TQM. They tested their TQMEX model, in a company in the construction sector, which had recently registered for ISO 9002 QMS. From their work HO and FUNG (1995 pp. 32) concluded that therefore, the underlying assumption of Pakistan Institute of Quality Control (ICQI'1999) 3

4 this research is that the registered firms are geared toward TQM and therefore the perception of the quality management on TQM could be considered as a significant measures of the state of development for TQM. Hence, an ISO 9000 QMS certified manufacturing company was selected for the case study in order to obtain accurate data. This view is also supported by FIGLALIC and KOC (1995). However, a company, that is certified for ISO 9000 QMS, does not necessarily have the experience for self assessment against a TQM model. This study was the first to use the TQM IQA model criteria set, as shown in table1 and its framework shown in figure1, for self assessment of a manufacturing company. SEQUENCE TQM FACTORS SCORE % EQUIVALENT MARKS 1. Top Management Role Customer and Market Focus Policy Planning Quality Assurance Resources Management Quality Culture Protection Continuous Improvement Satisfaction of the Stakeholders TOTAL SCORE Table 1 TQM IQA Model Factors with Scoring Scheme T H E S T A K E H O L D E R S S A T I S F A C T I O N O F QUALITY ASSURANCE QUALITY CULTURE PROTECTION CONTINUOUS IMPROVEMENT CUSTOMER AND MARKET FOCUS POLICY PLANNING RESOURCES MANAGEMENT T O P M A N A G E M E N T R O L E CBP Figure 1 Framework of the TQM IQA model Detailed scoring scheme for the TQM factors and elements is shown in Appendix A. The study also provided an opportunity for the company to gain experience and knowledge of preparing application for self assessment, based on the TQM IQA model. Pakistan Institute of Quality Control (ICQI'1999) 4

5 Analysis of the application also provide feed back on its strengths and areas that needed improvement in quality. A pro-forma of questionnaire was prepared and used for self assessment. Due to space limitations, the complete application can not be reproduced here. However, only one of the factors 10. SATISFACTION OF THE STAKEHOLDERS is reproduced in Appendix B. The structure of the pro-forma was explained to the management of the company before the start of the assessment case study. The company prepared an application based upon this assessment pro-forma. 3. ASSESSMENT METHODS Assessment methods are used for data collection on TQM practices maintained by the company (CONTI, 1991 pp. 169; SHERGOLD and REED, 1996 pp. 51; GEORGE, 1992; HAKES, 1996 and WIELE et al pp. 87). Any company can use the TQM IQA model criteria set to carry out self assessment. A number of assessment methods are available. These are: Award Style Method This is a detailed data based assessment method. It is time and resources consuming. However, this method is more in line with the assessment exercise undertaken in a quality award competition. It is also called as award simulation method. Quality expert, Hakes (1996 p. 27, 30),has written that This type of self assessment method is not typically a starter and This is not a process for beginner. Shergold and Reed (1996 pp. 5) maintained that This is a very comprehensive and accurate approach but is potentially very time consuming and resources intensive. In this approach, the assessment document is examined by external assessor(s). Facilitator Led Workshop Method This is also a data collection method. Here nominated facilitator(s) lead an assessment workshop for the senior executives and management of a company. It is more conceptual and less of a data base assessment exercise when compared to the award style assessment method. It is a short and quick method for assessment. Questionnaire Survey Method This is also a data collection method in which an assessment questionnaire is prepared. The questions are based on the assessment model criteria set. Questionnaires are forwarded to the company for preparing the application. In this assessment there are no physical contact between the company and the assessor(s). However, for the purpose of this case study, the facilitator led workshop method was found suitable and favored because: Facilitator led workshops are suitable for newcomers. The company selected was in the manufacturing sector and was the first company to undergo an assessment exercise with the newly developed TQM IQA model. It is also a live assessment to be conducted in the presence of the facilitator (author) in order to provide guidance for the difficulties faced in the assessment. This case study required that the company executives and management were led and guided in the use of the TQM IQA model criteria set. This approach was in line with DAVIS et al. (1996 pp. 6) who stated that usually, an initial self assessment needs to be carried out as a starting phase before an in-depth assessment, especially if the organization is undergoing the process for the first time. Pakistan Institute of Quality Control (ICQI'1999) 5

6 4. METHODOLOGY AND CONDUCT OF THE SELF ASSESSMENT CASE STUDY 4.1 Methodology. Following are the main steps of self assessment methodology: Explanation of the TQM IQA model and questionnaire based on it to the top management of the company in a workshop. Data collection by managers of the respective department against the questionnaire. Compilation of the company self assessment application. Analysis of the application by the facilitator while keeping in view the concept of each element/factor, the approach adopted for deployment and the results achieved. Site visit(s) of the company by the facilitator to verify/confirm certain facts mentioned in the application. Feed back report to the top management on the company s achievement (results) of TQM initiatives. Company management to prepare improvement plan based on the feed back report. 4.2 Conduct. A number of companies were contacted but the response was disappointingly poor. Through personal efforts rather than official channels, a willing collaborator was found. This was a manufacturing company already certified to ISO 9002 QMS. The Management Representative (MR) was nominated as the local coordinator by the Chief Executive Officer (CEO) for this assessment case study. The self assessment application prepared is bulky, so it cannot be reproduced completely here. However, response to the same factor presented in questionnaire in Appendix B 10. SATISFACTION OF THE STAKEHOLDERS is reproduced in Appendix C. 5. ANALYSIS OF THE SELF ASSESSMENT APPLICATION Analysis of the self assessment application has been carried out to determine the strengths and weaknesses in the operating practices employed by the company. As this is very detailed analysis, so it cannot be reproduced completely here. Hence, analysis of the same factor 10. SATISFACTION OF THE STAKEHOLDERS has been placed in Appendix D. The scoring system took account of the following: The approach adopted by the company s management. The deployment of the approach in the company. The results of the approach adopted. In order to add validity to the study a number of site visits, by the author, were carried out to clarify and verify the information and data provided in the self assessment application. The overall result of the assessment case study is that the company has obtained 26.44% score (264.4 marks out of 1000 total allotted marks). This meant that the company was at the initial stage of TQM implementation and large areas for improvement existed. 6. SUMMARY AND CONCLUSIONS The summary and conclusions of the assessment case study are: An assessment scenario was discussed that would enable self assessment by other companies to proceed smoothly; Pakistan Institute of Quality Control (ICQI'1999) 6

7 Assessment methods were mentioned and a suitable method was selected for the present assessment case study. In this case, the facilitator lead workshop method was found to be most appropriate and useful. The assessment case study was conducted in a manufacturing company which was certified to ISO 9002 QMS, in Pakistan. The company s assessment application was analyzed for its strengths and weaknesses. The overall result of the analysis that the company was in the early stages of TQM initiatives (26.44% score was obtained) and there existed many areas for improvement. The overall conclusion drawn was that a very comprehensive, complete and successful self assessment case study of a manufacturing company had been carried out for the first time with the TQM IQA model. 7. LESSONS LEARNT Other companies are expected to follow this case study to carry out self assessment to determine the strengths and weaknesses in their TQM practices. Improvement plans can then be made to convert these weaknesses into quality strengths. Also TQM IQA model can be adopted as Pakistan National Quality Award model. Pakistan Institute of Quality Control (ICQI'1999) 7

8 APPENDIX A DETAILED SCORES OF THE TQM IQA MODEL CRITERIA SET (FACTORS AND ELEMENTS ) S. No TQM FACTORS TQM ELEMENTS SCORE % EQUIVALENT MARKS 1 Top Management Role Leadership Vision Style Driving Force Commitment Involvement and 1 10 Participation 1.4 Team Work Communication Customer and Market Focus Customer Focus Marketing Policy Quality Policy Quality Mission and Objectives Planning Long Term Quality Planning 4.2 Short Term Quality Planning Quality Assurance Quality Management System 5.2 Information and Data Management 5.3 Quality Losses Cross Functional Management 5.5 Processes Standardization Products and Services Measurement and Control Measurement Control Audit Integrated System Approach Suppliers Pakistan Institute of Quality Control (ICQI'1999) 8

9 5.10. Company Distributors Customers Resources Management Human Resource Human Resource 2 20 management Education Training Quality Training Job Training Involvement Participation Team Work Empowerment Reward and 1 10 Recognition Motivation Financial Resources Material Resources Technology and Equipment Support and Maintenance 7 Quality Culture Quality Awareness Corporate Quality Culture 8 Protection Health and Safety Environment Continuous Improvement Review Improvement Activities Creativity, Innovation and Design 10 Satisfaction of the Stakeholders Customers Employees (Including Management) 10.3 Society Shareholders Government TOTAL SCORE Pakistan Institute of Quality Control (ICQI'1999) 9

10 APPENDIX B THE ASSESSMENT PRO-FORMA USED WITH THE TQM IQA MODEL (OBJECTIVES AND EVIDENCE) The assessment of each factor and element was to be carried out in order to investigate how TQM philosophy could lead a company into a Competitive Business Position (CBP). This appendix sets out the design of the questionnaire which was used with the model. This enabled a company to provide evidence for confirmation and verification of the existence of TQM practices. 10. SATISFACTION OF THE STAKEHOLDERS (27 % SCORE) OBJECTIVE: This factor assesses how the needs, expectations, welfare and legal liabilities of stakeholders are fulfilled to achieve their satisfaction and CBP Customers 14.2 Employees 14.3 Society 14.4 Shareholders 14. Satisfaction of the Stakeholders CBP 14.5 Government Figure 2. Stakeholders satisfaction contribution to a CBP 10.1 CUSTOMERS (14.3 % SCORE) OBJECTIVE: This element evaluates how the needs and expectations of the most important stakeholders of a company are fulfilled in order to achieve their satisfaction and a CBP. EVIDENCE NEEDED a. How are the customer needs and expectations for quality products and services matched to the company s capabilities? b. How are smooth, efficient and effective communications and good relationships established with the customer? c. How are customer complaints and claims, regarding products or services, efficiently and effectively resolved? d. How are customer satisfaction indices designed, used and recorded for monitoring improvement? e. How are the targets for achievements and comparison with the competitors set and the results and trends disclosed? Pakistan Institute of Quality Control (ICQI'1999) 10

11 SELF ASSESSMENT APPLICATION BY THE COMPANY APPENDIX C The application utilized the approach set out in Appendix B. The MR, besides other members of the top management (a designation used in a ISO certified company for the local coordinator of the company) provided the main source of EVIDENCE for company s quality practices, that were pertinent to the TQM IQA model factors and elements. The CEO and MR were the only authorized persons in the company to issue and amend the controlled document for the ISO 9000 QMS. The top management of the company was briefed initially on the nature of the research study and the TQM IQA model criteria set. Then the EVIDENCE for each element of a factor in the TQM IQA model criteria set was obtained from the them in the order on the questionnaire proforma as set out in Appendix B. The replies received are presented as follows. 10. SATISFACTION OF THE STAKEHOLDERS 10.1 CUSTOMERS a. As the company was a vendorized supplier of plastic components, it received contracts from all its customers. Fulfilling the requirements of these contracts was the sole aim in satisfying the customer. b. The company has installed the latest means of communication, , fax, mobile and conventional telephones. All these facilitated easy, reliable and smooth communications with the customer. The CEO and the MR also made regular visits to customers to establish personal links and good relations. c. The quality objectives (mentioned in the quality manual) of the company provided a clear indication for resolving customer complaints. Acknowledgement of these was within two days and actions taken within seven days. It was intended to reduce these times even further. d. The company has produced a customer evaluation form to assess customer response to its performance. The major evaluation criteria were delivery times, correct quantity and quality of the products. A pro-forma was sent out every three months, to the customer for this purpose. Action plans were made for the weak areas being identified from the surveys. Customer satisfaction has been categorized as Excellent, Good, Satisfactory and Poor. These surveys had shown that the trend was from Satisfactory to Good for the last quarter s survey. The company has also won the Best Performance Award as a vendor from Toyota Motors. e. The target was to move to a higher position on the customer satisfaction scale from Good to Excellent. No competitive comparison has been set as yet Pakistan Institute of Quality Control (ICQI'1999) 11

12 ANALYSIS AND SCORING OF THE SELF ASSESSMENT APPLICATION. APPENDIX D This appendix describes the scoring guidelines, process of analysis, scoring and summarized scores achieved, in the self assessment case study of the manufacturing company, based on TQM IQA model criteria set. 1. SCORING GUIDELINES The scores obtained were in response to the TQM IQA model criteria set and based on the following three areas: 1.1 Approach This describes the method used by the applicant to address the areas of an element of a factor. 1.2 Deployment This means the extent to which the approach was applied to all the requirements of an element of a factor. 1.3 Results This means the outcomes in achieving the purpose given in the element of a factor (EFQM, 1997) and (NIST, 1998). The scoring guidelines for APPROACH, DEPLOYMENT, RESULTS and SCORE (range) are given in the following table: APPROACH DEPLOYMENT RESULTS SCORE (Range) No systematic Little effective use. No results or poor 0 0 % approach evident; results in the area anecdotal information. reported; anecdotal evidence. Beginning of a Major gaps Early stages of the 1 25 % systematic existed in development of approach to the deployment that trends; some primary purposes of would slow the improvements and the element of a progress in early signs of good factor. achieving the performance levels Early stages of purpose of the in a few areas. transition from element of a Some favorable reacting to factor. comparison with problems to a Elements were their own targets. general applied to improvement. approximately one-quarter of the total potential when considering all the relevant areas and activities. A sound and No major gaps in Improvement systematic deployment, trends and good % Pakistan Institute of Quality Control (ICQI'1999) 12

13 approach responsive to the primary purpose of the element of a factor. A fact-based improvement processes in place in key areas; more emphasis placed on improvement rather than reaction to problems. A sound and systematic approach; responsive to the overall purpose of the element of a factor. A fact-based improvement process and where the company is learning. Clear evidence of refinement and improvement as a result of improvement cycles. A sound and systematic approach fully responsive to all the requirements of an element of a factor. A very strong factbased improvement process and extensive company learning. Strong evidence of refinement. though some areas or work units may be in the early stages of deployment. Elements were applied to about half of the total potential when considering all relevant areas and activities. Approach was well deployed with no major gaps; deployment may vary in some areas or work units. Elements were applied to about three-quarters of the total potential when considering all relevant areas and activities. Approach was fully deployed without any significant weaknesses or gaps in any areas or work units. Elements were applied in full when considering all relevant areas and activities. performance levels reported for many to most of the improvement areas of the company s key business requirements. Favorable comparison with their own targets in many areas. Some comparison with external companies. Most results show strong positive trends. Most trends or currents performance levels were sustained. Favorable comparison with their own targets in most areas. Favorable comparison against other companies in most areas. Strong positive trends and sustained excellent performance in all areas. Excellent comparison with own targets and other companies in most areas. Best in class in many areas of activities % % Pakistan Institute of Quality Control (ICQI'1999) 13

14 2. ANALYSIS Analysis of the self assessment case study application has been carried out and site visits conducted. Analysis is sequenced as: 1. STRENGTHS (+) 2. WEAKNESSES (-) 3. SITE VISITS ISSUES Each element has been shown with the score achieved (range). S TQM Factors ANALYSIS NO.. and Elements 10. SATISFACTION OF THE STAKEHOLDERS 10.1 Customers (40-50 %) 1. STRENGTHS (+) a. The company reviewed all contracts in order to ensure they had the capability of manufacture. b. The company received the precise needs and requirements of the customers (specifications and samples) in the form of contracts. c. The latest means of communications were available in the company for good communication with customers. Visits by customers and visits by company s top management to customers took place. d. Good working relations with the customers have been established. d. Quality objectives were a clear indication for solving customer complaints and claims within the specified time. e. The customer evaluated the company quarterly. It has progressed from the satisfactory to the good category. e. Currently, the company has obtained the best performance award from an OEMs customer. 2. WEAKNESSES (-) a. No detailed evidence was provided of a matching process of the company s capability against customer needs. b. No evidence was provided of the claim for good communications with customers. c. No evidence was provided of the good relationships with customers. d. No evidence was provided to support the claim that the objectives set for clearing complaints, were acceptable to the customers. e. No evidence was provided of the customer evaluation process and its contents. e. No detailed evidence was provided on the Best Performance Award criteria. f. No evidence was provided for the setting of targets for achievement and comparison with competitors. 3. SITE VISITS ISSUES a. To check the capability matching process. Normally the contract documents were circulated to the concerned departments for evaluation. Then a review meeting was held, for the managers and the top management team, to discuss capability against customer demand. b. To check who set the objectives for resolving customer complaints. Such objectives have been set but no documentary evidence was found. Pakistan Institute of Quality Control (ICQI'1999) 14

15 f. Targets for achievement have been set in order to move from good to the excellent category. c. To check the customer satisfaction report for the last quarter. This was checked out and it was found that the status awarded by the customer was good. 8. REFERENCES CONTI, T. June Company Quality Assessment. The TQM Magazine DAVIS, J.; KHODABOCUS, F. and OBRAY, C. March Self Assessment: A Path to Business Excellence. Quality World - Technical Supplement 4-11 EFQM 1997 The European Quality Award 1998 Information Brochure Brussels, EFQM Brussels Representative Office pp FIGLALI, A. and KOC, V The Effects of Total Quality Management on Human Side Performance Criteria. In: Kanji, G. K. ed. Total Quality Management, Proceeding of the First World Congress. London: Chapman and Hall GEORGE, S The Baldrige Quality System. New York: John Wiley and Sons Inc. HAKES, C The Corporate Self Assessment Hand Book for Measuring Business Excellence 3rd ed. London: Chapman and Hall. HO, S. K. and FUNG, C. K Developing a TQM Excellence Model. The TQM Magazine 6(6): HO, S. K. and FUNG, C. K Developing a TQM Excellence Model - Part 2. The TQM Magazine 7(1): HOLLOWAY, B. June Gaining the Benefits of Self Assessment. London: Quality World KHAN, N. and SHEIKH, M. A. R. October ISO The Core of TQM for a Developing Country. In: Proceedings of Pakistan s Third International Convention on Quality Control. Lahore: Ibrahim Publisher NIST 1998 Malcolm Baldrige National Quality Award 1998 Criteria for Performance Excellence Gaithberg Maryland, NIST pp SHERGOLD, K. and REED, D. M Striving for Excellence: How Self Assessment Using Business Excellence Model can Result in Step Improvement in All Areas of Business Activities. The TQM Magazine 8(6): WIELE, T. V.; DALE, B.; WILLIAM, R.; KOLB, F.; LUZON, D. M.; SCHMIDT, A. and WALLACE, M State-of-the-Art Study on Self Assessment. The TQM Magazine 7(4): WIELE, A. V.; WILLIAM, A. R. T.; DALE, B. G.; CARTER, G.; KOLB, F.; LUZON, D. M.; SCHMIDT, A. and WALLACE, M Self Assessment-A Study of Progress in Europe s Leading Organizations in Quality Management Practice. International Journal of Quality and Reliability Management 13(1): Pakistan Institute of Quality Control (ICQI'1999) 15

16 BIODATA Major Nawar Khan is a Mechanical Engineer. He has graduated from the University of Engineering of Engineering and Technology Peshawar in He did his MSc Mechanical Engineering (Specialized in Production Engineering) from the University of Engineering of Engineering and Technology Lahore in Mr Khan has completed his Ph. D under a split Ph. D program from the University of Engineering of Engineering and Technology Lahore and De Montfort University Leicester UK in His field of specialization is Total Quality Management (TQM). He is author of a number of national and international papers. Presently he is serving in one of the unit of the Corps of Electrical and Mechanical Engineering of the Pakistan Army. Pakistan Institute of Quality Control (ICQI'1999) 16