Total Quality Management Implementation in Cosmetic SME

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1 Total Quality Management Implementation in Cosmetic SME Puntaree Watcharavittayakul Fukuoka Institute of Technology, Japan Abstract: This study is about how to implement TQM (Total Quality Management) in case of SME (Small and Medium Enterprise). The cosmetic company is chosen because of quality strictness. TQM is one of the most widely used quality management strategy in the world. This study will find the proper step by step that can bring SME success in TQM implementation. In the other hand, Goetsch-Davis 20 step is picked to be model. This study like a guideline for the company to follow, and it is a long-term project that may spend time for 3-5 years. But it will be the long last management, and can be updated all the time. And for the mainly labor production liked in this study, TQM also consider about employee satisfaction that is good for human resource management. Key Words: TQM, Total Quality Management, SME 1. Introduction In cosmetic production, the most considered factor is quality. Because the cosmetic is identified to be the same category with food and drug that consumed directly. For above reasons, most of big companies decide to use the automatic machine to operate in production line. It is easy to control the production quality. In the other hand, SME (Small and Medium Enterprise) cannot support for this. So SME always decides to use labor instead. Especially, those are in the developing countries liked Thailand. In quality management study, the most variable factor is human error. So the company has to find the strategy that can manage both production and administration related to employee to cause the least fault. TQM is chosen. TQM (Total Quality Management) is widely used in manufacturing organization. Big companies mostly succeed in TQM implementation. In the other hand, only few of SMEs can fully succeed it. That results SMEs are disadvantage in the competition in market. The major reason is lacking of training in both upper and lower level. So this is emphasized in this study[1]. 2. Study Background 2.1 TQM philosophy TQM is abbreviated from Total Quality Management. It is to build quality into product and process design. It is proactive procedure to solve the quality problem. It is not only for production process, but it encompasses the entire organization. It also stresses the quality is customer driven. TQM is consisted of 7 concepts as following; Customer Focus The goal is to identify and meet customer needs. TQM identifies that customer need is the most important thing to conduct the specifications of product. But the customer need is uncertainty. It is continually to gather information, market surveys, and customer interviews Continuous Improvement It means never-ending improvement. It requires that the company continually try to better learning and problem solving. There are 2 approaches that can help company with continuous improvement; PDCA (Plan-Do-Check-Act) cycle and Benchmarking Employee empowerment It is to empower all employees to seek out quality problems and correct them. And it is to encourage the employees to identify the problem by rewarding not punishing. That means cooperation of employee have to be mainly considered, so employee satisfaction is significant.

2 Fig.1 Plan-Do-Check-Adjust (PDCA) Cycle Use of quality tool It is to identify the tool to the step of evaluation and discussion. Which tool should be used which kind of step? There are 7 tools widely used: cause-and-effect diagram, flow chart, checklist, control chart, scatter diagram, petro chart, and histogram Product design It is about use of QFD (Quality Function Deployment). It is the set of matrices that used to translate the preferences of the customer into specific technical requirements. And it is also related to reliability of the product. Reliability is probability that a product service or part will perform as intended for a specified period of time under normal conditions Process management It is from the concept Quality at the source. It is the belief that it is far better to undercover the source of quality problem and correct it than discard defective items after production Managing supplier quality It is about supplier quality. Traditionally the quality is checked when the good from supplier is arrived. In TQM philosophy, the company s representative residing at the supplier checks the quality of good since before leave from supplier. It is the other way to save time and cost[2]. 2.2 The Goetsch-Davis 20-Step Total Quality Implementation Process This process is concluded by David L.Goetsch and Stanley B.Davis[3]. These 20-step total quality implementation process can work for any organization with some adjustment that accommodate to the specific organization. The implementation model has three phases: preparation, planning, and execution Preparation Phase The preparation phase is necessary for any organization and the steps are listed in the appropriate order. (1) Commitment to total quality The top executive must make the commitment of time and resources. (2) Formation of the total quality steering committee Top executive find the staff to be the total quality steering committee. If a union is involved, the senior union official should be also a member of the steering committee. (3) Steering committee team building The steering committee needs to go through a team-building session before it starts any quality work. It may require the outside consultant. (4) Steering committee total quality training The steering committee will require training in total quality philosophy, techniques, and tools. (5) Creation of the vision statement and guiding principles Total quality steering committee will create the organization s vision statement and putting on papers the guiding principles under which the company is to operate. (6) Establishment of broad (strategic) objectives The broad company objectives are set following the company s vision statement. (7) Communication and publicity It is to make sure that everyone in the organization

3 knows about the vision, the guiding principles, the objectives, and total quality. It is very important that they have to know why total quality is being implemented. (8) Identification of organizational strengths and weaknesses It is to identify the strengths and weaknesses of organization. This information will help guide it to the best total quality implementation approach and may also highlight deficiencies that must be corrected. (9) Identification of advocates and resisters It is to survey for who are likely to be total quality advocated, or who are resisters. This will help in selecting the early projects and team members. (10) Baseline employee satisfaction and attitude The steering committee should attempt to gauge the current state of employee satisfaction and attitude. It should carry out with help of the human resource department. (11) Baseline customer satisfaction It is carried out with help of the department that closest with the customers. It is always sale department. It is to obtain objective feedback from customers to determine their level satisfaction. In other hand, it can judge for the effectiveness of your TQ efforts Planning Phase (1) Plan the implementation approach then use PDCA cycle It is to start planning the implementation of total quality. This step becomes continuous because after initial projects are under way, information will be fed back to this step to accommodate course correction, adjustment, and so on. It is also to continue to spin out new projects and teams. (2) Identification of projects The steering committee is responsible for selecting the initial total quality projects, based on the strengths and weaknesses of the company, the personalities involved, the vision and objectives, and the probability of success. (3) Establish team composition After the projects selected, the steering committee establishes the composition of the teams that will execute them. Most teams will be cross function, having representative from multiple departments. (4) Provide team training Before new team can go to work, it must be trained. Training should cover basics of total quality and tools appropriate to the project Execution phase (1) Team activation and direction (use PDCA cycle) The steering committee gives each team its direction and activates it. Teams work on their assigned projects using the total quality techniques they have learned. They use the PDCA cycle as their total quality process model. (2) Team feedback loop to the steering committee The project team closes the loop with the steering committee by providing feedback information on progress and results. The steering committee uses this feedback to determine if adjustments or changes in direction are required. And then, the changes will be back to the project teams again, which will carry out the new instructions. (3) Customer satisfaction feedback loop Special project teams are deployed to obtain customer feedback information, covering both external and internal customers. This information is digested in the steering committee s PDCA cycle and influences direction changes issued to the project teams and also the formation of new project teams. (4) Employee satisfaction feedback loop Another special project team periodically takes the pulse of employee attitude and satisfaction. It is necessary for the steering committee and other managers to stay close to the employees to develop rather accurate information on attitude and satisfaction. This information is fed to the steering committee as another stream of data on which to evaluate progress and determine any necessary course corrections. (5) Modify infrastructure as necessary Feedback obtained from previous steps will guide the steering committee to address necessary changes in the corporate infrastructure procedures and processes, organization structure, awards and recognition programs, union rule, and etc. It may be steering committee do the authorization itself, or there is the other project team to do it. 3. Methodology The methodology mainly followed the Goetsch-Davis 20-step total quality implementation process. But the steps are simplified and combined to easy for understanding. Before start the implementation, there must be the studying for overall of company. It

4 Fig2. The Goetsch-Davis 20-Step Total Quality Implementation Process includes production process, administration, and human resource management. The rearrangement implementation steps are following; 3.1 Preparation phase Prepare steering committee According to the company structure, the steering committee is consisted of the manager of the department; production department, quality control department, human resource department, and sale department. And all of members have to participate the team building activity and be trained about total quality concepts Prepare guiding principle and developing goal It is usually that the company has already the vision of the company. That can bring to strategic objective and guiding principle Communication Total quality policy has to been promoted to all of companies. Everyone have to know that now there is something new to be implemented Survey for organization member satisfaction and customer After promotion, there will be feedback that will get form the member. There are both advocates and resisters. It is more comfortable to find the team member for sub-implementation plan. In the other hand, the feedback includes employee satisfaction or attitude to company, and customer satisfaction. It is liked the company assessment, for the employee should be done by anonymous. From the results, it can bring to organization strengths and weakness that is useful to the further plan. 3.2 Planning Phase Plan the approach The approach must be based on PDCA cycle and the survey that found in preparation phase Select the team project It may be according from the survey from the preparation phase. This team project has to be trained to be able to implement the plan efficiently. 3.3 Execution Phase Team Direction The steering team gives team direction and activates team to implement the plan. Then the steering

5 team has to consult the plan implementation results with the project team. If there is any fault, it has to be fixed and re-implement again. It would be repeated this loop until all plan is completed Customer feedback loop After full implementation, there will get the product. Then it will be able to get the feedback about the product from the customer. Feedback will bring to the other solution develop the plan. Organizational Excellence Introduction to Total Quality, 6 th ed., Pearson Educational International (2010) Biography Miss Puntaree Watcharavittayakul Thailand, Bangkok, 31 Oct Fukuoka Institute of Technology System Management Engineering Professor: Fumio Akagi After implementation, the implemented part will fully implemented to all of department. The provided step is only to implement one policy. In total quality management, there are many policies or points in each department. And each plan implementation is based on the PDCA cycle bring to continuous improvement. 4. Conclusion and Discussion Total quality implementation is long-term project in every size of company. However, the big company is able to implement more efficiency than the smaller one. There is many factors cause this; such as: the amount of staffs, type of production, human resource management, and etc. So SME has to find the method that can implement TQM efficiency. It may be spend time more than the bigger one, but it is still advantage. The key point of this method is steering committee training. If they understand well, they can guide for all. But the most of committee is manager level that has important responsibility and has no time to be trained full-time. It may be take an hour per day but it is long for 2-3 months. In the other hand, there are still many obstacles that need to be solved. In this study, there is still no the exact statistical result because it is the long-term plan. It may spend 3-5 years for fully implementation. But after the implementation started for a while, it will show the change in the management. It is not only the company gets the advantage the employee is also too. Reference [1] Salman,K.: TQM Implementation in Textile Manufacturing Industry to Success: Review and Case Study, International Business Research, Vol.4, No.4 (October 2011) [2] Reid, D.S., Nada, R.S.: Operations Management, 2 nd ed., Wiley (2005) [3] David, L.G., Stanley B.D.: Quality Management for