Topic 12 Total Quality Management. From Control to Management. Deming s Fourteen Points for TQM

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1 Topic 12 Total Quality Management From Control to Management 1 Inspection Error detection of finished goods Rectification Reading guide: Chapter 20 (Slack et al, 2004) and MGT326 Slides/Handout 1 2 Quality Control Statistical Methods applied to processes Quality standards Process improvement 2 From Control to Management continued Deming s Fourteen Points for TQM 3 Quality Assurance Quality Systems Quality Costing Quality Planning Problem solving 4 Quality Management Everyone involved; teamwork; staff empowerment Involves customers and suppliers Quality strategy Create consistency of purpose Lead to promote change Build quality into the products Build long term relationships Continuously improve product, quality, and service Start training Emphasize leadership 3 4

2 Deming s Points - continued Drive out fear Break down barriers between departments Stop haranguing workers Support, help, improve Remove barriers to pride in work Institute a vigorous program of education and selfimprovement Put everybody in the company to work on the transformation Other Quality Gurus Juran move from conformance to specification to fitness for purpose motivation and involvement of workforce Ishikawa quality circles cause and effect diagrams 5 6 Other Quality Gurus continued Costs of Quality Taguchi engineering in quality through product design poor quality is a loss to society Crosby quality is free zero defects Prevention Costs New product quality planning Product improvement Process improvement Staff training and development Appraisal Costs Incoming materials inspection Monitoring production for quality issues Customer surveys Quality laboratories Finished goods inspection 7 8

3 Costs of Quality continued Cost of Quality Model Internal Failure Costs Scrap Reworking / correcting Downgrading Retest Plant downtime Investigation / troubleshooting External Failure Costs Warranty / guarantees Returned goods Handling complaints Allowances / litigation Loss of goodwill Costs Total Cost Make P+A more effective Prevention + Appraisal costs Internal + External Failure Costs 9 Quality Effort 10 Some Concepts for TQM Continuous improvement Benchmarking Employee empowerment Just-in-time as a production philosophy TQM tools Tools for TQM Quality Function Deployment Taguchi technique Quality loss function Pareto charts Process charts Cause-and-effect diagrams Statistical process control 11 12

4 Quality Function Deployment (QFD) Determines what will satisfy the customer Translates those customer desires into the target design Product design process uses cross-functional teams Marketing, engineering, manufacturing Taguchi Techniques Experimental design methods (statistical) Identify key component & process variables which affect product variation Taguchi Concepts Quality robustness Ability to produce products uniformly regardless of manufacturing conditions Quality loss function Target specifications Aim to produce bang on target rather than just anywhere in acceptable range Quality Loss Function Shows social cost ($) of deviation from target value Assumptions Most measurable quality characteristics (e.g., length, weight) have a target value Deviations from target value are undesirable Equation: L = D 2 C L = Loss ($); D = Deviation; C = Cost 15 Frequency (number) Pareto Analysis of Wine Glass Defects Scratches Porosity Nicks Contamination Misc 72% 16% 5% 4% 3% Causes, by percent of total defects 16

5 Process Chart Fishbone Chart - Problems with Airline Customer Service SUBJECT: Request tool purchase Dist (ft) Time (min) Symbol Description D Write order On desk 75 D To buyer D Examine = Operation; = Transport; = Inspect; D = Delay; = Storage Quality Awards Prizes to companies that have shown excellence in quality management leadership strategic quality planning human resources quality assurance of products and services quality results and customer feedback, etc Deming, Malcolm Balbridge, European Foundation for Quality Management, etc. Malcom Baldrige National Quality Award Established in 1988 by the U.S. government Designed to promote TQM practices Some criteria Senior executive leadership; strategic planning; management. of process quality Quality results; customer satisfaction 19 20

6 Leadership 10% People management 9% Policy and strategy 8% Resources 9% Quality awards Processes 14% People satisfaction 9% Customer satisfaction 20% Impact on society 6% Enablers - 50% Results - 50% The European Quality Award model Business results 15% Quality Systems Supplier Approval and Evaluation Schemes Major purchasers (e.g. Ford, M&S) have detailed approval schemes for suppliers The scheme may cover aspects including Human resources: management capabilities and style Technical capabilities: product knowledge, equipment used Quality systems, records, quality record Finance and pricing: financial strength, cost conscious Helpfulness ISO9000 A system for certification by approved bodies that an organisation has and uses satisfactory quality systems. A customer may accept ISO9000 rather than their own approval scheme. IS0O9000 may be more or less demanding. ISO9000 is not in itself a guarantee of quality products ISO9000 is not the same as TQM: it is only a part. ISO9000 continued ISO9000 variations ISO9001: design / development, production, installation and servicing ISO9002: production and installation Each requires the design, documentation and implementation of quality systems Certification is provided by independent assessors 23 24

7 ISO9001 Clauses Benefits of Implementing ISO Management responsibilities 2 Quality Systems 3 Contract review 4 Design control 5 Document control 6 Purchasing 7 Customer supplied material 8 Product identification and traceability 9 Process control 10 Inspection and testing 11 Inspection, measuring and test equipment 12 Inspection and test status of products 13 Control of non-conforming product 14 Corrective action 15 Handling, storage, packaging, delivery 16 Quality records 17 Internal quality audit 18 Training 19 After sales servicing 20 Statistical techniques 25 Reduction in errors, complaints, defects, costs Retention of customers / gaining customers Reduced need for customer audits Improved controls, procedures, identification and solution of problems PERA survey - respondents claims 89% improved efficiency 48% increased profitability 76% improved marketing 26% improved export sales 26 Problems of Implementing ISO9000 Extremely time consuming and can be expensive Terminology difficult to follow Consultants usually required Result can be managing by manual ISO9000 does not encourage continuous improvement No evidence that companies with ISO9000 exhibit better quality performance (Dale) 27 Implementing TQM TQM failures (the Economist, quoted by Slack) One third of US companies felt that TQM had improved their competitiveness One fifth of UK companies believed their quality programmes had produced tangible results Of those quality programmes that had been in place for more than two years, two thirds grind to a halt because of their failure to produce hoped for results. 28

8 Conclusions about TQM There has clearly been a quality revolution, particularly in manufactured goods such as cars, televisions. TQM and ISO9000 have not necessarily produced tangible benefits. Has the cost outweighed the benefits? 29