GE3752 TQM-Course Material

Course Material
Programme B.E. ECE& CIVIL

Course Total Quality Management
Course Code GE3752 Semester 7 Regulation AU R21 / JIT R24
Course Outcomes
CO
Statement Blooms Level
Code
C702.1 Explain various TQM concepts in a selected enterprise Level 2
C702.2 Explain the TQM principles in a selected enterprise Level 2
C702.3 Identify the Six Sigma and apply Traditional tools, New tools,Benchmarking and FMEA. Level 2
Identify the Taguchi's Quality Loss Function, Performance Measures and
C702.4 apply QFD, TPM, COQ and BPR.
Level 2
Identify the QMS and EMS in any organization
C702.5 Level 2
Syllabus
Introduction - Need for quality - Evolution of quality - Definition of quality - Dimensions

Unit I of product and service quality -Definition of TQM-- Basic concepts of TQM - Gurus of
TQM (Brief introduction) -- TQM Framework- Barriers to TQM -Benefits of TQM.
Leadership - Deming Philosophy, Quality Council, Quality statements and Strategic

planning- Customer Satisfaction -Customer Perception of Quality, Feedback, Customer
complaints, Service Quality, Kano Model and Customer retention - Employee
Unit II involvement - Motivation, Empowerment, Team and Teamwork, Recognition & Reward
and Performance Appraisal-- Continuous process improvement -Juran Trilogy, PDSA
cycle, 5S and Kaizen - Supplier partnership - Partnering, Supplier selection, Supplier
Rating and Relationship development.
The seven traditional tools of quality - New management tools - Six-sigma Process
Capability-Bench marking - Reasons to benchmark, Benchmarking process, What to
Unit III Bench Mark, Understanding Current Performance, Planning, Studying Others, Learning
from the data, Using the findings, Pitfalls and Criticisms of Benchmarking - FMEA
Intent, Documentation, Stages: Design FMEA and Process FMEA
Unit IV
Quality circles Quality Function Deployment (QFD) Taguchi quality loss function - TPM
Concepts, improvement needs - Performance measures- Cost of Quality - BPR.
Introduction-Benefits of ISO Registration-ISO 9000 Series of Standards-Sector-Specific

Standards - AS 9100, TS16949 and TL 9000-- ISO 9001 Requirements-Implementation-
Unit V Documentation- Internal Audits-Registration-Environmental management SYSTEM:
Introduction-ISO 14000 Series Standards-Concepts of ISO 14001-Requirements of ISO
14001-Benefits of EMS.
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Course Code & Name GE3752-Total Quality Management
Resources and Recommended Readings:
Text Books:
1.Dale H.Besterfiled, Carol B.Michna, Glen H. Besterfield, Mary B.Sacre,Hemant Urdhwareshe and Rashmi
Urdhwareshe, "Total Quality Management", Pearson Education Asia, Revised Third Edition, Indian Reprint, Sixth Impression,2013
References Books:
1. Joel.E. Ross, "Total Quality Management - Text and Cases", Routledge.,2017
2. R2.Kiran.D.R, "Total Quality Management: Key concepts and case studies, Butterworth - Heinemann Ltd, 2016
3. R3.Oakland, J.S. "TQM Text with Cases", Butterworth-Heinemann Ltd., Oxford, Third Edition, 2003
4. R4.Suganthi,L and Anand Samuel, "Total Quality Management", Prentice Hall (India) Pvt. Ltd., 2006.
e-resources Links:
1. W1.https://www.allaboutcircuits.com/textbook/semiconductors/chpt-8/the-instrumentation-amplifier/
2. W2.https://www.youtube.com/watch?v=dEbmk4yALA8
3. W3.https://www.youtube.com/watch?v=Iv4Cj2A3ldw
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Unit I – INTRODUCTION
INTRODUCTION
TOTAL = Made up of the whole
QUALITY = Degree of excellence a product or service provides
MANAGEMENT = Act, art or science /manner of handling,

controlling, directing etc
TQM is a structured system for satisfying internal and external customers

and suppliers by integrating the business environment, continuous improvement
and breakthrough with development, improvement and maintenance cycles while
changing organizational culture.
Need for Quality

1. Increasing demands of customers
2. Increasing competition
3. Technological changes
Evolution of Quality
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Definitions of quality
Quality is defined in the following ways:
1. “The ability of a product or service to meet customer needs”
2. “The totality of features and characteristics of a product or service that bears on its ability
to satisfy stated or implied needs”,a definition by ISO American Society for Quality.
3. “Quality is meeting or exceeding customer’s expectation”.
Quality is quantified as
Q = P / E Q = Quality
P = Performance
E = Expectations
Dimensions of product and service quality
When it comes to measuring the quality of your services, it helps to understand the
concepts of product and service dimensions. Users may want a key board that is durable and
flexible for using on the wireless carts. Customers may want a service desk assistant who is
empathetic and resourceful when reporting issues.
Quality is multidimensional. Product and service quality are comprised of a number of dimensions
which determine how customer requirements are achieved. Therefore it is essential that you
consider all the dimension that may be important to your customers.
Product quality has two dimensions.
 Physical dimension - A product's physical dimension measures the tangible product itself
and includes such things as length, weight, and temperature.
 Performance dimension - A product's performance dimension measures how well a
product works and includes such things as speed and capacity.
While performance dimensions are more difficult to measure and obtain when compared to
physical dimensions, but the efforts will provide more insight into how the product satisfies the
customer.
Like product quality, service quality has several dimensions.
 Responsiveness - Responsiveness refers to the reaction time of the service.

 Assurance - Assurance refers to the level of certainty a customer has regarding the quality
of the service provided.
 Tangibles - Tangibles refers to a service's look or feel.
 Empathy - Empathy is when a service employee shows that she understands and
sympathizes with the customer's situation. The greater the level of this understanding, the
better. Some situations require more empathy than others.
 Reliability - Reliability refers to the dependability of the service providers and their ability
to keep their promises.
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The quality of products and services can be measured by their dimensions. Evaluating all
dimensions of a product or service helps to determine how well the service stacks up against
meeting the customer requirements.
IMPORTANT POINTS TO BE NOTED WHILE QUALITY PLANNING :

1.Business, having larger market share and better quality, earn returns
much higher than their competitors.
2.Quality and Market share each has a strong separate relationship to profitably.
3.Planning for product quality must be based on meeting customer needs, not
just meeting product specifications.
4.For same products. We need to plan for perfection. For other products, we
need to plan for value.
BASIC CONCEPT OF TQM
A committed and involved management to provide ling term, top to bottom

organizational support.
It is useless to embark on a quality journey without the top management‘s commitment to quality.
Top management must participate in the quality programme. They must also participate on quality
improvement teams and also act as coaches to other teams.
An un – wavering focus on the customer both internally and externally.
The employees of the organization in the first place. Mangers must listen to the suggestions
and recommendations made by the employees to improve quality.
This aspect of listening to the voice of customers leads to the emphasis of design
quality and defect the prevention.
Effective involvement and utilization of entire workforce.
TQM is everyone‘s responsibility in an organization. All workers in and organization must be

oriented towards TQM and all personnel must be trained in TQM, statistical process control and
other appropriate quality improvement skills.
Continuous improvement of the business and production process.
Continuous improvement refers to constant refinement and improvement of products,

services and organizational systems to yield improved value to consumers.
Areas such as on-time delivery, scrap reduction, supplier management, customer satisfaction,
etc. are good quality projects to begin continuous improvement.
Treating suppliers as partner
The traditional relationship between the buyer and the supplier has been adversarial in nature.
Each tried to extract the maximum out of each other. There was lack of trust on each other.
To ensure good relationship with suppliers, frequent change of suppliers should be avoided
and suppliers should be few in number so that true partnering can occur.
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Establishing performance measures for the process.
Performance measure is an integral part of the quality process. If an organization cannot

measure its progress, it is useless for it to go on a quality journey. Performance measures such as
percentage of non conformance, absenteeism, customer satisfaction, etc., should be determined for
each functional area.
Gurus of TQM (Brief introduction)
THE DEMING PHILOSOPHY
In 1950 he taught SPC concepts and the importance of quality to the leading CEO‘s of
Japanese industry. He developed the following fourteen points as a theory for management for
improvement of quality productivity and competitive position.
1.Create and publish the aims and purposes of the organization
Organization must develop a long term view at least 10 yrs Plan to stay in business by setting
long range goals.
Resources must be allocated for research, training and continuing education to achieve the goals
Innovation in promoted to ensure that the product or services does not become absolute
Organizational philosophy is developed to send the message that everyone is part of the
organization
2.Learn the new philosophy
Organization must seek never-ending improvement and refuse to accept non- conformance.
Customer satisfaction is the number one priority
The organization must concentrate on defect prevention rather that defect detection.
Everyone should involved in the quality journey and change his or her attitude about quality
Supplier must help to improve quality
Share the information relative to customer expectations
3.Understand the purpose of inspection
Mass inspection is costly and un reliable it is replace by statistical techniques It is required for
self and supplier
Mass inspection is managing for failure and defect prevention is managing for success.
4.Stop awarding business based on price alone
Awarding business based on the low bid, because price has no meaning without quality
To examine how customer expectations are affected and provide feedback to the supplier
regarding the quality
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5.Improve constantly and forever the system
Management must have take more responsibility for problems by actively finding and
correcting problemsSo that quality and productivity are continually and permanently improved
and costs are reduced.
The focus is preventing problems before they happen.
Responsibility is assigned to teams to remove the causes of problems and continually improve
the process.
6.Institute training
Employee must be oriented Management must allocate resources to train employee to perform
their jobs .Everyone should be trained in statistical methods and monitor the need for further
training.
7.Teach and institute leadership
Improving supervision is management‘s responsibility Training in statistical methods

Supervisors not focusing on negative fault findings,
He create positive supportive Communication must be clear from the top management to
supervisor and to operators
8.Drive out fear, create trust and create a climate for innovation.
By providing workers with adequate training, good supervision and proper tools to do the job as
well as removing physical dangerous.
When people are treated with dignity fear can be eliminated and people will work for the
general good of the organization.
This climate will provide ideas for innovations and improvement.
9.Optimize the efforts of teams, groups, and staff areas.
Barriers internally like levels of management among department within department etc. Barriers
externally like with customers and suppliers The barriers exist because of poor communication,
ignorance of the organization mission, completion, fear and personal grudges. To overcome these
attitudes need to be changed communication channel opened, project teams organized, training for
teamwork.
10.Eliminate exhortations for the work force
Exhortations that ask for increased productivity without providing specific improvements
methods .They do not produce a better product or service, because the workers limited by the
system Improvements in the process cannot be made unless the tools and methods are available.
11.a) Eliminate numerical quotas for the work force
Instead of quotas,management must learn and institute methods for improvements.

Quotas and work standards focus on quality rather that quality.
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Quotas should be replaced with statistical method of process control.
b.) Eliminate management by objectives
Management must learn the capabilities of the processes and how to improve them
Management by numerical is an attempt to manage without knowledge of what to do
12.Remove barriers that rob people of pride of workmanship
Loss of pride in workmanship exists throughout organization because Workers do not know
how to relate the organization mission
They are being blamed for system problems
Poor designs lead to the production of ―Junk‖ In adequate training is provided
In adequate or in-efficient equipment is provided for Performing the required work.
13.Encourage Education and self-improvement for everyone
What an organization need is people who are improving with education
A long term commitment to continuously train and educate people must be made by
management
Everyone should be retained as the organization requirements change to meet the changing
environment
14.Take action to accomplish the transformation
Management has to accept the primary responsibility for the never ending improvement of the
process.
Management must be committed, involved and accessible if the organization is to succeed in

implementing the new philosophy.
Contribution of Juran
His lectures introduced the management dimensions of planning, organizing, and controlling and
focused on the responsibility of management to achieve quality and the need for setting goals
Juran defines quality as fitness for use in terms of design, conformance, availability, safety, and
field use He is prepared to measure everything and relies on systems and problem-solving
techniques. Unlike Deming, he focuses on top-down management and technical methods rather
than worker pride and satisfaction.
•The Trilogy consists of three sequential and logical groups of activities:
•Quality Planning
- discover customer needs and deficiencies and design adequate processes
•Quality Control
- compare actual performance to goals and take action on the differences

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•Quality Improvement
- the attainment of unprecedented levels of performance
QUALITY PLANNING
• Identify the customers
• Determine the customer’s needs
• Develop product features
• Establish quality goods
• Develop a process
•Prove process capability
QUALITY CONTROL
• Choose control subjects
•Choose units of measurement
•Establish measurement
• Establish standards of measurement
•Measure actual performance
• Interpret the difference
•Take action on the difference
QUALITY IMPROVEMENT
•Prove need for improvement
•Identify specific projects for improvement
•Organise to guide the projects
•Organise for diagnosis – for discovery of causes
•Diagnose to find the causes
•Provide remedies
•Prove that remedies are effective under the operating conditions provide for control to hold gains
JURAN’S 10 STEPS TO QUALITY IMPROVEMENT
•1. Build awareness of opportunity to improve.
•2. Set-goals for improvement.
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•3. Organize to reach goals.
•4. Provide training
•5. Carryout projects to solve problems.
•6. Report progress.
•7. Give recognition.
•8. Communicate results.
•9. Keep score.
•10.Maintain momentum by making annual improvement part of the regular systems and
processes of the company
Contribution of Crosby
•CROSBY IS KNOWN FOR HIS FOLLOWING CONTRIUBUTIONS
1. FOUR ABSOLUTES OF QUALITY
2. FOURTEEN STEPS TO QUALITY MANAGEMENT
3. CROSBY’S QUALITY VACCINE
FOUR ABSOLUTES OF QUALITY
•Quality is defined as conformance to requirements, not “goodness”
• The system for achieving quality is prevention, not appraisal.
•The performance standard is zero defects, not
“that’s close enough”
•The measurement of quality is the price of non conformance ,not indexes.
14 Principles of Crosby for Improvement of quality
1. Establish and ensure management commitment
2. Form quality improvement teams for quality improvement process planning and administration
3. Establish quality measurements
4. Evaluate the cost of quality and explain its use as a management tool to measure waste.
5. Raise quality awareness among all employees.
6. Take actions to correct problems identified through previous steps
7. Establish a zero defects committee and programme
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8. Train supervisors and managers on their role and responsibilities in the quality improvement
process
9. Hold a zero defects day to reaffirm management commitment.
10. Encourage individuals and groups to set improvement goals.
11. Obstacle reporting
12. Recognize and appreciate all participants
13. Establish quality councils to discuss quality matters on a regular basis
14. Do it all over again to demonstrate that the improvement process never ends.
TQM Framework
Total Quality Management (TQM) is a comprehensive and structured approach to organizational

management that seeks to improve the quality of products and services through ongoing
refinements in response to continuous feedback.
HISTORICAL REVIEW
The concept of specification of labour was introduced during the industrial revolution
As a result a worker no longer made the entire product, only a portion. This change brought
about a decline in workmanship
Because productivity increased there was a decrease in cost, which result in lower customer
expectations
As products become more complicated and jobs more specialized, it became necessary to
inspect product after manufacturing
In 1942 W.A. Shewhart of Bell Telephone Laboratories developed a statistical chart for the
control of product variables. This is beginning of SQC
In some decade H.F. Dodge and H.G. Romig both of Bell telephone laboratories developed the
area of acceptance sampling as a substitute for 100% inspection. It is recognized by 1942
In 1946 the American society for Quality Control was formed. Now it is American Society for
Quality
In 1950 W. Edwards Deming who learned SQC from shewhart, gave a series of lectures on
statistical methods to Japanese Engineers
Un 1954 Joseph M. Juran made his first trip to Japan and further he emphasized management‘s
responsibility to achieve quality
By this concept the Japanese set the quality standard for the rest of the world In 1960 the first
quality circles were formed for quality improvement by Japanese workers
By 19770‘s and 80‘s U.S. managers were making frequent trips to Japan to learn about the
Japanese miracle
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In 1980‘s the automotive industry began to emphasizes statistical process control (SQC)
Emphasis on quality continued in the auto industry in the year 1990‘s. when the Saturn
automobile ranked first in customer satisfaction in 1996
ISO 9000 became the world wide model for quality system.
TQM FRAMEWORK
PRINCIPLES OF TQM
Customer focus
Leadership
Involvement of people
Continuous improvement/ long-term
Systematic improvement/ approach
Problem prevention
Quality as everyone‘s job
Mutually beneficial
BARRIERS / OBSTACLES IN IMPLEMENTATION OF TQM
1..TQM program is not properly sold to top management
2. Supervision and involvement by the management is inadequate

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3. Inadequate support/ encouragement/direction by top management
4. Lack of follow up
5. A budget insufficient to continue with the TQM program
6. The management may feel that too much Paper work is taking away much of the workers time
7. The management may feel that the scope of the TQM program is too broad
8. Poor attention given to customer feedbacks and complaints
9. Poor supply chain management can hinder TQM
10. Race to get there, in order to satisfy the bosses and to keep up with time
Lack of management commitment
The management commitment should be clearly communicated both verbally and in action to the
organization.If the workers feel that the management is doing only the talking about no action is
initiated on TQM then they too will lack necessary commitment and motivation to implement
TQM principles.
Inability to change organizational culture
The past culture should be unlearned and the new culture should be learnt. This gives rise to
enormous resistance to change from the employees.
It is very difficult for an organization to make a culture change.
Improper planning
When planning for TQM all the constitutes should be involved in the development of the
implementation plan and any modification that occur as the plan evolves. Rapid planning will
ensure that the TQM fails.
Planning should be done on the customer front, employee‘s front and the supplier front.
Lack of continuous training and education
Training and education is an ongoing process for everyone in the organization. The training needs
of the employees must be determined and a plan should be developed to satisfy those needs.
Training and education are most effective when senior management conducts the training
programme based on the principles of TQM
Incompatible organizational structures and isolated individuals and department
Lack of co ordination and difference of opinion among departments and individuals in an

organization will create implementation problems.
The use of multifunctional teams can help to break this barrier.
Restructuring of the organization may be needed to make the organization more responsive to the
needs of the customers.
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Ineffective measurement techniques and lack of access to data and results
In order to improve the process, one has to measure the present position. Mechanisms to measure
the present position should be available in the organization.Once the measurement is done the data
should be made available to the necessary mangers to make decisions.
Any clogging of data to the managers will become a barrier to TQM implementation.
Playing inadequate attention to internal and external customers
Organizations have to understand the changing needs and expectations of the customers both
internal and external.
Effective feedback mechanisms that provide data for decision making are necessary for this
understanding.
One way to overcome this is to give the right people in the organization, a direct access to the
customers.
Inadequate use of empowerment and teamwork
Individuals should be empowered to make decisions and take responsibility to make decisions that
affect the efficiency of the process of production.
Teams should be formed and need to have proper training. The team‘s
recommendations should be adopted whenever possible.
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Unit II – TQM PRINCIPLES
LEADERSHIP DEFINED
Leadership is interpersonal influence exercised in a situation and directed through communication process, towards the
attainment of a specialized goal or goals. Thus leadership is a process of influencing the activities of an individual or a
group for goal achievement in a given situation.
LEADERSHIP CONCEPT
Leadership requires in order to become successful as a leader , he needs an intimate and insightful understanding of human
nature – the basic needs, wants and abilities people, a leader needs to know and understand the following;
1.People need both security and independence at the same time.
2.People are sensitive and do respond to external rewards or punishments. They are also strongly self-motivated.
3.Peoples sometime value a kind word of praise more than any monetary reward.
4.They trust their gut reaction more than statistical data.
5.A leader should simplify the task
ROLE OF SENIOR MANGEMENT
Senior management must practice the philosophy of Management By Wandering Around (MBWA). They should get out
of the office and visit customers, departments, and plants within the organization and suppliers
Encourage subordinates to write only important messages that need to be part of the permanent record.
Senior management role is no longer to make the final decision, but to make sure the teams decision is aligned
with the quality statement of the organization
Problem solving and decision making to the lowest appropriate level by delegating authority and responsibility.
Senior managers must stay informed on the topic of quality improvement by reading books and articles attending
seminars and talking to other TQM leaders.
The needed resources must be provided to train employees in the TQM tools and techniques, the technical requirements
of the job and safety.
Must be visibly and actively engaged in the quality effort by serving on teams, coaching teams and teaching seminars.
They should lead by demonstrating, communicating, and re-in forcing the quality statements.
They should spend about one third of their time on quality
Senior managers are listening to internal and external customers and supplies through visits, focus groups and surveys.
To create awareness of the importance of TQM and provide TQM results in an ongoing manner.
Senior managers should be able to drive fear out of the organization, break down barriers, remove system roadblocks,
anticipating and minimize resistance to change and in general change the culture.
PDSA CYCLE
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STEWART developed the plan-do-check-act (PDCA) cycle and late Deming modified it to plan-do-study-act (PDSA) cycle.
Plan: By management. Do: By the operator. Study: quality manager Act: management
Plan
It is important to establish the stage of the change to be introduced.
Plan on how you are going to collect the information about the differences that occur after the implementation of the plan.
What is to be done and how to achieve.
Put the plan into practice.
There may be changes that should only be measured over long periods.
Record any unexpected event, problems and other observations. Star analyzing the data.
Study
Review and reflect on the data collected in the previous step
Find out whether there has been any improvement in the process. Did your expectations match the reality of what
happened?
Find out what could have been done differently.
Act
Carry out an amended version of what happened during the ―Do" stage and measure any differences
PROBLEM SOVING METHOD FOR PROCESS IMPROVEMENT.
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5s-concept
1.Seiko (Proper arrangements)
This is the proper identification of materials, equipments and tools, data and information which are necessary or not
necessary,.
Provide the necessary space for the required or necessary items which you require to perform the necessary task.
2.Seiton (orderliness)
Every equipment or data or anything should be placed in its appropriate and unique place.
So that a simple eraser or pencil can be found at the same place every time by everybody in the organization.
This reduces confusion and avoids wastages of time.
The place in which it is stored should be easily accessible and appropriate.
3.Seiso (Cleanliness)
The shop floor should be free of wastage, oil spills, cotton wastes etc.,
The tools also should be clean, the machines should be clean and the entire organization should be free from dirt and any
unexpected objects lying around.
Keep the work place clean and make data and information easily available and constantly updated in order to support
decision making.
4.Seiketsu (personal cleanliness).
A person should be clean and his cloths should be clean. Only a clean person can be conscious about keeping his
workplace clean and neat.
Moreover unclean person present a work situation were co-workers become uncomfortable to work in.
Personal cleanliness automatically creates a favourable condition at work place for physical and mental health, free from
dirt, pollutants etc.
5.Shitsuke (Discipline).
This may not only be the jobs related to the organization but also personal work.
Job discipline is the habit and skill development to perform the job according to standards, to observe company rules and
policies at all times.
KAIZEN REQUIRES THE USE OF THE FOLLOWING:
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1.The data about value adding and non-value adding activities.
2.The knowledge about various types of waster (Muda). Over production, delay, transportation, processing, inventory,
wasted motion and defective parts.
3.Documentation of the operating procedure.
4.Principles of time study.
5.Following the 5s concept.
6.Fewer inventories – use JIT.
7.Mistake proofing- to prevent or detect errors.
8.Effective use of teams to solve problems and to improve the performance.
CUSTOMER SATISFACTION
1. What is customer satisfaction?
A. Customer satisfaction model
2. Who are the customers?
A. Types of customers
B. Customer - supplier chain
3. Customer perception of quality
4. Identifying customers needs
5. Kano model of customer satisfaction
6. Customer complaints (Feedback)
7. Service quality or customer service
8. Customer retention
CUSTOMER SATISFACTION MODEL
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• IN TODAY‟S BUYERS MARKET “THE CUSTOMER IS THE KING”

• The customers are:
- the most important people in the business
- not dependent on the organization. The organization depends on them.
- not an interruption to work but are the purpose it.
- doing a favor when they seek business and not vice- versa
- a part of business, not outsiders
- life blood of the business
- people who come with their needs and jobs
- deserve the most courteous and attentive treatment.
TYPES OF CUSTOMERS
• INTERNAL CUSTOMERS
Each functional area
• EXTERNAL CUSTOMERS
1) Purchaser
2) End user / Ultimate customer
3) Merchants
4) Processors
5) Suppliers
6) Potential Customers
7) Hidden customers
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CUSTOMER – SUPPLIER CHAIN
CUSTOMER – SUPPLIER CHAIN

• CUSTOMER PERCEPTION OF QUALITY
1. Performance
2. Features
3. Service
4. Warranty
5. Price
6. Reputation
FACTORS INFLUENCING CUSTOMER PERCEPTION OF
QUALITY
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INDENTIFYING CUSTOMER NEEDS

• Customer surveys, focus groups, and market research programs and studies
• Routine communications, such as sales and service calls and reports, management reviews,
house publications
• Tracking customer complaints, incident reports, letters, and telephone
contacts
• Customer meetings
• User conferences for the end user
• Information on competitor’s products
• Personal visits to customer location
• Personal experience dealing with the customer and the product
• Employees with special knowledge for the customer
• Government or independent laboratory data
• Simulated use experiments and planning processes that involve the customer
KANO MODEL OF CUSTOMER SATISFACTION
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1. THRESHOLD / BASIC ATTRIBUTES

(BASIC NEEDS)
Characteristics that must exist in order for the product to achieve success. The customer can
remain neutral in attitude toward the product even with improved execution of the attributes.
2. ONE-DIMENSIONAL ATTRIBUTES
(PERFORMANCE/LINEAR): (PERFORMANCE NEEDS)
Characteristics that directly correlate to customer satisfaction. Increased functionality or quality of
execution will result in increased customer satisfaction. Conversely, decreased functionality will
result in greater dissatisfaction.
3. ATTRACTIVE ATTRIBUTES (EXCITERS/DELIGHTERS):
(EXCITEMENT NEEDS)
Characteristics that give customers greater satisfaction and for which they are willing to pay a
price premium. Satisfaction will not decrease below neutral if the product lacks the feature.
CUSTOMER COMPLAINTS / FEEDBACK
• To focus on customer, an effective feedback program is necessary, objectives of program
are to:
1. Discover customer dissatisfaction
2. Discover priorities of quality, price, delivery
3. Compare performance with competitors
4. Identify customer’s needs
5. Determine opportunities for improvement
• CUSTOMER COMPLAINTS RELATED TO PRODUCT
1. Product is defective / non – functioning
2. Product is unreliable
3. Product did not meet the basic requirements
4. Customer expectation was higher than what the product could deliver
5. Frequent breakdown of product
6. Product has defective parts
7. Product provided with defective accessories
• CUSTOMER COMPLAINTS RELATED TO AFTER SALES SERVICE
1. Service department responding to the problem
2. Speed of response to a customer call
3. Basic behaviour and courteousness of the service personnel
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4. Competence of the service personnel

5. Product complaint not resolved even after repairs
• TOOLS USED FOR COLLECTING CUSTOMER FEEDBACK / COMPLAINT:
1. Comment cards
2. Customer questionnaire
3. Post-transaction surveys
4. Report cards
5. Focus group
6. Social media
7. Toll-free telephone numbers
8. Customer visits
9. Employee feedback
CUSTOMER COMPLAINTS FLOWCHART
SERVICE QUALITY / CUSTOMER SERVICE
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CUSTOMER RETENTION
• Customer retention is the process of retaining the existing customers.
• It is obvious that customer retention is more powerful and effective than customer
satisfaction
• Over 60% of an organisation’s future revenue will come from existing customers
• A 2% increase in customer retention has an equivalent impact upon profitability as a 10%
reduction in operating costs
• Up to 96% of unhappy customers do not in fact complain. But they are three times more
likely to communicate a bad experience to other customers than good one.
• 91% of the unhappy customers will never purchase goods and services from you again
• If you make an effort to remedy customer’s complaints, 82 to 95% of them will stay on
with You
• It costs 5 times as much to attract a new customer as it costs to keep an old one.
• For Customer Retention, we need to have both
“Customer satisfaction & Customer loyalty”.
• CUSTOMER RETENTION
The following steps are important for customer retention.
1. Top management commitment to the customer satisfaction.
2. Identify and understand the customers what they like and dislike about the organization.
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3. Develop standards of quality service and performance.

4. Recruit, train and reward good staff.
5. Always stay in touch with customer.
6. Work towards continuous improvement of customer service and customer retention.
7. Reward service accomplishments by the front-line staff.
8. Customer Retention moves customer satisfaction to the next level by determining what is truly
important to the customers.
9. Customer satisfaction is the connection between customer satisfaction and bottom line.
EMPLOYEE INVOLVEMENT
TQM requires everybody‘s involvement in the process and everyone should feel that the company
belongs to them. Employee involvement results in improved quality and productivity.
MOTIVATION:
MEANING/DEFINITION:
Motivation is a process that starts with a physiological or psychological deficiency or need
that activates behavior or a derive that is aimed at a goal or an incentive.
Motivation is the result of processes internal and external to the individual that arouse enthusiasm
and persistence to pursue a certain course of actor.
THEORIES OF MOTIVATION
MASLOW THEORY
According to this theory every individual is depicted as a wanting organism with a desire to rise
from one level to another level in the society. Maslow suggests five levels for every individual
with differing needs at every level.
1.Basic or physiological needs
The first need of a person is physiological in nature. physiological needs are the necessities for
survival. Once this need is satisfied, they no longer act as motivators for the employee. These
factors when available are taken for granted and employees look for the next level as motivators.
2.Security or safety needs.
Employees now strive to achieve the next level which is safety needs. These needs include safe
place of work and job security, which are very important for employees.
3.Social needs.
Since a man is social being, he has a need to belong and to be accepted by the various
groups.When social needs are dominant, a person will strive for meaningful relationship with
others. He gets a fear of being rejected.
Conversely when an individual has an opportunity to be a part of a group by feeling important and
needed will motivate that person.
4.Esteem needs.
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Self esteem needs are concerned with self respect, recognition, self worth and feeling of being
unique.
5.Self-actualization.
Individuals in an organization must be given the opportunity to go as far as their abilities will take
them. Many organizations have a policy of promoting employees from within. This motivates
employees to contribute their maximum to the organization.
MOTIVATION DISSATIFACTION
(YGINE FACTOR)
HERZBERG‟S TWO-FACTOR THEORY:
He identified that people were motivated by recognition, responsibility, achievement and job
advancement. He labels these factors as motivation.
He also identified that bad feelings were associated with low salary, minimal fringe benefits.
Power working environment and ineffective supervision.
These factors were labeled as dissatisfaction or hygiene factor
It should note that the presence of extrinsic (hygiene factors) results in dissatisfaction, but the
absence of motivating factor does not make employee dissatisfied.
EMPLOYEE EMPOWERMENT
MEANING:
Employee empowerment is making a person completely responsible for a particular task; the
individual who is empowered becomes the process owner.
In the empowerment the individual in given complete authority required to execute the process
and ownership is created.
Condition:
Every one should understand the need for change in culture and attitude.
The system must change to the new paradigm.
People should be provided with necessary resources.
Empowerment is an environment in which people have the ability the confidence and the
commitment to take the responsibility and ownership to improve the process and initiate the
necessary steps to satisfy customer requirements within well-defined boundaries in order to
achieve organizational values and goals
TEAMS
T-together E-everyone A-achieve M-more
A team is defined as a group of people working together to achieve common objectives or goals.
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Teamwork is the cumulative actions of the team during which each member of the team
subordinates his individual interests and opinions to fulfill the objectives or goals of the group.
TYPES OF TEAM
1.Process improvement team.
Here, five to six members from various disciplines of the organization are brought together to
solve a problem. Usually the scope of the team is limited to the work unit.
The life cycle of the team is usually temporary. The team is disbanded after the problem (process
improved) is solved.
2.Cross-functional team.
Here the team is constituted by the number of different functional areas such as production,
engineering, marketing, finance, e etc. it may also include customers and suppliers.
3.Natural team.
This type of team is not voluntary in nature as it was with other teams. Here all members of the
work unit are in the team and the manger is also part of the team.
4.Self-management work groups.
They are an extension of natural work team without the supervisor. These teams are the essence of
the empowered organization. These teams not only do the work but also manage it.
STAGES OF TEAM DEVELOPMENT:
1.Forming.
Forming is the fist and beginning stage of the life cycle of a team.
A facilitator is appointed by the quality council and he meets with the senior management to
charter the path the solution of the problem should take.
Once team is assembled, a meeting is called and the facilitator briefs the problem to the team,
and then determine the type of training the team members may need and identify an appropriate
team leader.
2.Storming.
In this stage all members of the team are fully aware of the quality problem they are faced with.
They will be interested in proving themselves by exhibiting their individual skills.
3.Norming.
In this stage members have understood each other well. Everyone knows each others strengths
and weakness and capabilities and limitations.
The roles of the members are clearly defined, mission and objectives are clear and the course to
be taken to solve the problem is also clear.
4.Performing.
In this stage, the team members have understood the project better and begin performing by
diagnosing and solving problems and choosing and implementing changes.
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BARRIES OF TEAM PERFORMING:

1.Poor training for the group members.
2.Improper reward schemes.
3.Lack of planning.
4.Lack of management commitment in monitoring the team program.
5.Poor communication.
6.Too many members in team.
Role of team leader:
1.Ensure the smooth and effective operation of the team.
2.Handling and assigning the responsibilities.
3.Good record keeping.
4.Preparing and presenting the report.
5.Prevents other members from dominating.
6.Use positive interpersonal dominating.
7.Serve as a contact point between the team and qty council.
8.Monitors the status and accomplishments of member assuming firmly completion of
assignments.
9.Prepares the meeting agenda i.e. time, date, location.
Role of team member:
1.Contributes best.
2.Sharing knowledge.
3.Listen carefully and ask question.
4.Negotiate important points.
5.Supports the decisions of the team.
6.Trust support concern for other team members.
7.Understands and is committed to team objectives.
8.Respects and is tolerant of individual differences.
9.Acknowledges and worker through conflict openly.
10.Carries out assignments between meetings such as connecting data observing charting data and
returning report.
11.Gives honest sincere appreciation.
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Recognition and reward:

Recognition and reward are basic motivational tools used to motivate employees to encourage
them to maintain and improve their present level.
Publicly acknowledging the contributions of an individual is called recognition.
This acknowledgement may be in the form of a certificate or a verbal praise.
On the other hand the rewards are tangible such as cash reward, gold coins etc
Reward can be delayed but the recognition of the contributions must be done immediately.
Purposes:
1.Reward system reminds the continual improvement required for the TQM journey.
2.Serves as a platform for encouraging the super performances.
3.Serve as a goal for the employee.
4.Serve as a morale booster.
Performance appraisal
Performance appraisal is the judgement of employee‘s performance in the organization.
Performance appraisal is defined to show the employees how they are doing. This serves as a basis
for promotion, salary increases etc those who are rated poorly should be allowed to undergo
special counseling and skill up-grading programmer.
It should help people to assess themselves and improve.
Appraisal format:
1.Ranking- compares employees by ranking from highest to lowest.
2.Narrative- gives a written description of employee‘s strength and weakness.
3.Graphic-indicate the major duties performed by the employees and rate each duty with a sale,
which is usually from 1(poor) to 5(excellent).
4.Forced choice-places each employee‘s in a category with a predetermined percentage for
example excellent 10%, very poor 25%, grave 30%, fair 25%, poor10%.
BENEFITS
1.PROMOTION
2.SALARY INCREASE
3.BONUS
4.INCENTIVES
5.INDENTIFYING TRAINING NEEDS
6.IMPRORING SKILLS OF THE EMPLOYEE‘S
7.TO IMPROVE EMPLOYEE PERFORMANCE
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8.TO RATING THE CUSTOMERS.

CONTINUOUS PROCESS IMPROVEMENT
CPI is the care of TQM. CI in the business process as war as production process is desired for the
growth of the organization.
CPI is possible by
1.Making all process effective and adaptative.
2.Accepting the change in the customer requirements and tuning ourselves to meet demand.
3.Improving the productivity by eliminating waste.
4.Permanently eliminating the ‗non-value adding activities‘.
5.Our self with the best player in the field.
6.Using advanced tool like DOE(design of experiments), SPC, quality function development etc .
JURAN‟S TRILOGY
Juran‘s trilogy consists of three managing process quality planning, quality control and quality
improvement.
Quality planning:
The quality planning starts with identifying external customers of a business.
Identify who are the customers.
Determine the needs of those customers
Translate those needs into the business possibility Develop a product that can respond to
those needs
Optimize the product features so as to meet the organizations needs and customer‘s needs.
Quality Improvement
Develop a process which is able to produce the Product.
Optimize the process.
Quality control:
Prove that the process can be producing the producet under operating conditions with minimal
inspection.
Transfer the process to operations.
The quality control involves checking the products produced with specification.
QUALITY IMPROVEMENT STRAREGIES
1.REPAIR:
There are two levels of repair.
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a)In the first level the team or an individual working in the process identifies the problem and
eliminates the root cause of the problem. This brings in permanent solution for the problem.
b)In the next level the faulty product reaches the customer. The customer then indicates that he has
received a bad product and the product is either replaced or repaired. This is temporary solution to
the problem.
c)It is important to note that the repair strategy will not make the process better than the original
design.
2.CONTINUOUS IMPROVEMENT/ REFINEMENT:
Refinement is doing things a little bit, faster, better, easier, or with less waste.
It is the process products and services are required to keep the quality improvement process alive.
But management may fail to notice the small improvement and influence fail to reward the
improvement efforts. This will result in dissatisfaction and loss of involvement.
3.INNOVATION:
The processes and products by innovative methods.
For example: automation of process.
4.PARADIGM SHIFT (RE-INVENTION):
When a company understand that the existing processes cannot ensure the customer satisfaction it
is better to reinvent the process.
SUPPLIER PARTNERSHIP
The relationship between customer (company) and the supplier. Customer and supplier have the same goal to satisfy the
end user. Both the customer and the supplier have limited resources they must have work together as partners to maximize
their return on investment.
Principles of customer-supplier relations:
1.Both the customer and supplier are responsible for the quality control.
2.Supplier and customer should be independent of each other.
3.The customer must communicate to the supplier about his requirements.
4.There should be agreement with respect to quality, price, mode of delivery and payment mode.
5.The supplier should supply quality materials that will result in customer satisfaction.
6.Provisions for the easy settlement of the disputes.
7.Mutual exchange of information.
QUALITY COUNCIL
Meaning
Quality council is composed of the chief executive officer, the senior managers of the functional areas, such as design,
marketing, finance, production and quality and a coordinator or consultant. Individual selected for the coordinated
position should be bright young person with execution potential.
Objectives of quality council:
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To raise the quality consciousness in the organization through seminars, study tours and using forms of promotion.
To ensure effective functioning of the organization on the quality statement and plan.
To encourage basic and applied research and development in the field of quality and dissemination of its results to the
organization.
To raise the level of training of personnel engaged in quality activities including the assessors and trainees.
To facilitate upgradation of testing and calibration facilities and laboratories as well as to encourage the overall quality of
the organization.
DUTIES OF QUALITY COUNCIL
Develop with input from all personnel; the core values Vision statement, Mission statement, and Quality policy statement.
Develop the strategic long term with goals and the annual quality improvement program with objectives
Determine and continually monitor the cost of poor quality.
Create the total education and training plan.
Determine the programme measures for the organization.
Continually determine those projects that improve the process.
( internal and external customers)
Establish or revise the recognition and reward system to account for the new way of doing business.
QUALITY STATEMENT
In addition to the core values and concepts, the quality statement includes the Vision statement, Mission statement and
Quality policy statement. Once developed they are occasionally revised and updated. They are part of the strategic planning
process, which included goals and objectives.
VISION STATEMENT
The vision statement is a clear declaration of what an organization aspires to be in the future (in long term). Its purpose is
to provide a platform for the managers for thinking strategically. A vision statement is usually an ideal condition, that might
never be reached but that will inspire the people to achieve.
Example: “THE HAPPIEST PLACE ON EARTH” - Disney Theme park.
MISSION STATEMENT
The mission statement answers the following questions. Who we are, who are the customers, what we do and how we do it.
This statement is usually one paragraph or less. It is easy to understand and describe the functions of the organization. It
provides a clear statement of purpose for employees, customers and supplies.
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EXAMPLE: BEN & JERRY‟S ICE CREAM – MISSION STATEMENT
PRODUCT MISSION: TO make, distribute and sell the finest quality natural ice cream and related products in a wide
variety of innovative flavors made from Vermont dairy products.
QUALITY POLICY STATEMENT
QPS serve as a guide for everyone in the organization. This statement clarifies the employees about how the products and
services must be provided to the customers. The CEO of the company writes quality policy
statement after a careful study and analysis of the feedback from the workforce. Finally the quality council must approve
the statement.
EXAMPLE:
Meet the requirements of the customers (both internal and external) Go ahead competition
Complete utilization of the entire workforce.
STRATEGIC PLANNING
Organizations are finding that strategic quality plans and business plans are inseparable. The strategic planning is three to
ten years and short term planning is one year or less. It consists of goals and planning.
SEVEN STEPS TO STRATEGIC PLANNING.
1.Identification of customer needs.
2.Determination of customer positioning
3.Predict the future.
4.Gap analysis.
5.Closing the gap.
6.Aligning the plan to the mission and vision.
7.Implementation of the plan.
1.Identification of customer needs.
This steps provides a focus on customer satisfaction.
There needs and wants have to be identified and satisfied.
The profile of the customers are identified. Questions like who are our customers? Will they change in future? What
will they want in future?.
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2.Determination of customer positioning
The planners determine where the organization wants to be in relation to the customers.
Expand the customer base products or services.
Products with poor quality performance should be removed or eliminated and replaced by better ones.
The organization needs to concentrate its efforts on areas of excellence
3.Predict the future
Predict the future conditions that will affect their product or service Using effective tools for analyzing and
predicting future
Some products or services have become absolute because it failed to foresee the changing technologies.
The mangers in the organization anticipate a change in the first place, and then they can make necessary arrangements
by making investments on resources and be prepared to take on the future.
The rate of change is continuously increasing.
4.Gap Analysis
The planners to identify the gaps between the current state and future state. The present position of the
organization in the market in relation to competition, profits, customer satisfaction employee satisfaction, etc. to the
intended position.
If any there is gap identified future strategies must be formulated taking this gap in to consideration.
5.Closing the Gap
After gap analysis plans must be formulated to reduce or close the strategic gap.
To close the gap by establishing goals and responsibilities.
All stakeholders should be included in the development of the plan.
6.Alignment
It must be aligned with the mission, vision, and core values and concepts of the organization.
7.Implementation
a.Resources must be allocated to collecting data, designing changes and overcoming resistance to change.
b.To monitoring activities to ensure that progress is being made.
Monitoring by the steering committee and periodical assessments are required for an effective and speedy implementation
CUSTOMER SATISFACTION
CUSTOMER SATISFACTION MODEL:
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CUSTOMER:
A customer can be defined as one who purchases a product or service.
There are two distinct type of customer.
Customer satisfaction is achieved when their expectations are matched by what is offered to them by the organization. It is
important for the organization to listen to the voice of the customers to ensure that is marketing, production, R&D ,
distribution and service truly meet the expectations of the customers.
There are two distinct types of customers; they are external and internal customers.
A)External Customers:
External customers can be defined as the one who purchases the product of the organization for end usage or for reselling
or to use the product in his production process as raw material.
B)Internal customers:
Internal customers are the employees of the organization. As far as the top management in concerned they have an
obligation to keep internal customers satisfied.
CUSTOMER PERCEPTION OF OUALITY:
An American society for quality (ASO) survey on end user perception of
important factors that influenced purchases showed the following ranking.
1.Performance
2.Features
3.Service
4.Warranty
5.Price
6.Reputation
1.PERFORMANCE
Performance of the product is the ―fitness‖ the product or service by the customer at the time of sale.
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It indicates that the product can be used as such without any further modification.
Availability, which is the probability that a product will operate when needed.
Reliability is the consistent performance of the product every time is used
Maintainability which is the ease of keeping the product operational is also important.
2.FEATURE
Features are the secondary characteristics or added facilities available with the core product.
FOR EXAMPLE:
Primary function of an automobile is transportation where as stereo system is a feature.
3.SERVICE:
Service is emerging as a method for organizations to give the customer added value.
The product may work fine but if the service which is attached to the product is not managed properly then it will lead
to customer dissatisfaction.
FOR EXAMPLE:
Purchase of Air conditioner, the seller has to come to your home to install and run the A/C machine. After that he must
come and service the A/C with regular internal and incase of any problem immediately come and repair the problem.
4.WARRANTY:
The warranty encourages customer to buy a product a service by reducing the risk of the purchase division.
5.PRICE:
Customer is willing to pay a higher price to obtain value. he evaluating product and services against those of its competitors
who provides the greatest value.
6.REPUTATION:
Find organizations by our overall experience with them.
Customer satisfaction is based on the entire experience with the organization not just the product.
FEEDBACK:
Customer feedback must be continually solicited and monitored. Customer continually changes. They change their
minds, their expectations and their supplies. Customer feedback is not a one-time effort it is a ongoing and active probing of
the customer‘s mind.
IT ENABLES THE ORGANIZATION:
Discover customer dissatisfaction. Discover relative priorities of quality.
Compare performance with the competition. Identify customer‘s needs.
Determine opportunities for improvement.
TOOLS USED:
1.COMMENT CARD –attach with warranty card.
Comment cards are simple cards usually in the form of prepaid postage card which can be attached with the product
manual or the warranty card. or just included with the product the time of purchase.
2.Survey.
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It is more effective and also popular tool for obtaining opinions and perceptions about an organization and its products and
services.
Customers are asked to furnish the answers related to the quality of the product and service.
3.Focus group.
The focus group is like an in depth interview, except that it involves a group rather than an individual. It is a group
interview that tries to stimulate people to talk freely about the products.in a typical focus group, a few customers are invited
to attend a group discussion at a central interviewing location.
4.Toll-free telephone numbers.
Toll free phone numbers (1600 – inIndia, /800/888 in US) are an effective technique for receiving customer feedback.
Organizations can respond faster and more cheaply to a complaint on receiving a complaint call.
5.Customer visits.
Company personnel visiting customers at their place will provide valuable information and feedback on the product.
6.The Internet
Web home pages and e-mails have become very popular these days that they are fast replacing the conventional methods of
feedback mechanism.Customers also find it very easy and cheaper to provide feedback to the supplier.
Using customer complaints:
Every single complaint should be accepted, analyzed and acted upon for its represents.
Information on customer dissatisfaction is received into
the organization at the highest level, there by providing a fast response.
Complaints can be seen as opportunity to obtain information and provide a positive service to the customers.
Activities of the customer complaints:
Investigate customer‘s experiences by actively soliciting feedback both positive and negative and then acting it
promptly.
Develop procedures for complaint resolution.
Analyze complaints but under stand that complaints do not always fit in to neat categories.
Survey response is received a senior manager should contact the customer and strive to resolve them.
Establish customer satisfaction measures and constantly monitor them.
Provide a monthly complaint report to the quality council for their evaluation and improvements.
SERVICE QUALITY
CUSTOMER SERVICE is the set of activities an organization used to win and retain customer‘s satisfaction. It can be
provided before during or after the sale of the product or exits on it‘s own.
ELEMENTS OF CUSTOMER SERVICE: ORGANIZATION:
Identify each market segment. Write down the requirements.
Communicate the requirements.
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CUSTOMER CARE:
Meet the customer expectations. Get the customer point of view. Deliver what is promised.
Make the customer feel valued. Respond to all the complaints. Over respond to the customer.
Provide a clean and comfortable customer reception area.
COMMUNICATION:
Optimize the trade-off between time and personal attention. Minimize the number of contact points.
Provide pleasant knowledgeable and enthusiastic employees. Write documents in customer friendly language.
FRONT-LINE PEOPLE:
Serve them as internal customer. Hire people who like people.
Give them the authority to solve the problem. Challenge them to develop better methods.
Be sure they are adequately trained.
Recognize and award performance.
LEADERSHIP:
Lead by example.
Listen to the front-line people.
Strive for continuous process involvement.
CUSTOMER RETENTION
Wheather retail or industrial customer, are constantly watching out for better cheaper products and when a competitor is
able to offer the product better, that the customers usually switch.
Any organization should develop a very personal relationship with individual customers, so that they do not switch over to
the competitors.
CUSTOMER RETENTION represents the activities the produce the necessary customer satisfaction that creates customers
loyalty, which actually improves the bottom line.
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Unit III – TQM TOOLS & TECHNIQUES I
SEVEN TOOLS OF QUALITY

FLOW CHARTS
It shows the process of work i.e. the flow of material or information through a
sequence of operations. These diagrams show the flow of the product or services as
it moves through the various processing operations.
The diagram makes it easy to visualize the entire system, identify potential trouble
spots and locate control activities.
Improvements can be accomplished by changing, reducing combining or

eliminating steps.
RUN CHARTS
Notify customer as to
s of process characteristics agains time or in chronological sequence. They do not have statistical basis, but are useful in
revealing.‘
Trends
Relationship between variables.
PARETO CHARTS AND ANALYSIS

 The 20% ruleVilfredo Pareto (1848-1923)
 80% of the wealth in Italy was
held by 20% of the production
 20% of customers accounted for 80% ofsales
 20% of parts accounted
for 80% of cost.. Etc. Pareto principles states that
 PARETO charts show the most frequently occurring factors
 Analysis of pareto charts help to make best
use of limited resources by targeting the most important problems to tackle.
CAUSE AND EFFECT DIAGRAMS
It was developed by Dr. Kaoru Ishikawa in 1943mand is sometimes referred to as an Ishikawa
diagram or a fishbone diagram because of its shape.
A cause and effect diagram is a picture composed of lines and symbols designed to represent a
meaningful relationship between an effect and its causes.
This tool helps to organize problem-solving efforts by identifying all the factors that might have
caused the problem. During brain storming sessions, this diagram is used to organize the ideas
generated.
A typical cause-and-effect diagram is shown. The diagram shows the various elements (cause) that
would have caused cracks on the surface, after the finishing process.
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HISTOGRAM DIAGRAMS
A histogram is a graph that displays the distribution of data. A histogram is also known as ‗frequency distribution
diagram‘. It is constructed from the data collected in a frequency table. A frequency table is a chart that divides the range
of data into several equal sections to compare the frequency of occurrence in each section.
Uses of histogram
A histogram is used to show clearly where the most frequently occurring values are located and the data is distributed. It is
also a tool for determining the maximum results. It enables the analyst to quickly visualize the features of a complete set of
data.
Construction of histogram
A histogram may be constructed using the following steps:
1.After the data collection, count the number of data values collected.
2.Determine the range of the data. Range=Highest value-lowest value.
3.Divide the data values in groups or classes and count the number of values in each class. The following table shows the
guidelines to divide the data values.
GUIDELINES TO FORM CLASSES
Number of values Number of classes Number of values Number of classes
Less than 50 5-7 100-250 7-12
50-100 6-10 More than 250 10-20
4.Now deter mine the width of the classes
Width of the classes=range/Number of classes selected from the above table
5.Draw a frequency table for all values.
6.Construct a histogram based on the frequency table. For that, mark the class limits on the horizontal axis and the
frequency on the vertical axis.
7.Finally write the title and number of values on the diagram.
CHECK SHEET
A check sheet is a form in table format prepared for recording data. Thus the necessary information can be recorded by
making a check mark on the page. Check sheets are used in following ways:
1.Check sheets for recording data and making surveys Defective item check sheet
Defect factor check sheet Defect position check sheet
Process distribution check sheet
2.Inspection and validation check sheet
CONTROL CHARTS
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A control charts is used to monitor a process to see if the process output is random.
It helps to detect the presence of controllable causes of variation. It can also
indicate when a problem occurred and give insight into what might have caused the
problem. Control charts are discussed in detail in the topic.
SCATTER DIAGRAMS
Scatter diagram is a graph that shows the degree and direction of relationship between two variables. It can be useful in
deciding whether there is a correlation between any two variables.
Relationship between the temperature and the number of errors committed per hour. High values of temperature
correspond to high number of errors and vice versa. Higher values of speed correspond to low noise and vice versa.
The higher the correlation between the two variables, the lesser will be the scatter the points will tend to line up. On the
other hand, if there were little or no relationship between two variables, the points would be completely scattered.
NEW MANAGEMENT TOOLS
1. Affinity Diagram
2. Relations Diagram
3. Matrix Diagram
4. Tree Diagram
5. Arrow Diagram
6. Process Decision Program Chart
7. Matrix Data Analysis
Three Stages in Planning for Problem Solving

1. Stage I – Problem Definition
2. Stage II – Development of Strategies
3. Stage III – Formulation of Action Plans
Relation Between the Old and New Tools
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AFFINITY DIAGRAM
• Used for Pinpointing the exact problem in a confused state.
• A diagram that is used as a method of sorting qualitative data, which usually comes in the
form of short phrases or sentences
STEPS:
• Decide on topic on which confusion exists.
• Collect verbal data from all sources related to the objective. Data may be facts, opinions
and ideas.
• Data collected should be written on separate card called Data card
• Pick out pair of cards which have natural affinity and arrange them side by side.
Combine the statements of two affinity cards and form a single sentence.
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RELATION DIAGRAM
• Used to find appropriate solutions by studying the relationship between various causes and
effects.
• The most common use of the Relations Diagram is to show the relationship between one or
more problems and their causes.
STEPS:
• Express the problem in Question form.
• Comments are written and placed in the floor with each comment in each card.
• Cards are organized in such a way that similar cards are placed together.
• Cards are divided in such a way to separate primary, secondary and tertiary cause.
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Unit IV – Unit Title IV
MATRIX DIAGRAM
Used to facilitate multidimensional thinking in analyzing problems.
• The Matrix Diagram allows a many-to-many comparison of two lists, by turning the
second list on its side to form a matrix.
Different shapes of matrix for comparing more than the basic two lists. - the L-Matrix, C-Matrix,
T-Matrix, X-Matrix and Y-Matrix.
-Identify the set of variables to be considered for analysis. It may be the cause of the problem, any
operating parameter that has influence on the problem, e.t.c.
TREE DIAGRAM
Used to obtain best strategies for an objective. First the objective is fixed.
- Objective may be Target, goal or desired result. Then a succession of strategies for achieving is
developed.
- is used to find feasible measures for problem solving to clarify the content of an area to be
improved through branching at each node or view point.
Creating a Tree diagram
• Establish the basic objective, Think primary means, Deploy secondary means and beyond,
Conform the relationship between the objectives and means and complete the tree diagram,
Evaluate the basic means
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ARROW DIAGRAM
• Used for working out optimal schedules for any process.
• Helps in identifying potential problems and discovery of overlooked information before
work starts.
STEPS:
• Decide on the objective and discuss as a team to identify all
the necessary activities required to complete the job.
• Arrange them in sequence and use appropriate symbols to draw the arrow diagram.
Symbols:
Activity, Dummy, Node, Time limit, EST, LFT.
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PROCESS DECISION PROGRAM CHART

• The Process Decision Program Chart ( PDPC) provides a simple method to help in
identifying both risks and counter measures.
• If the plan is displayed diagrammatically (typically in a Tree Diagram), then identified
risks and countermeasures are added in subsequent boxes.
• This may appear to be quite trivial, but as with many other tools, the construction and
thought involved is as important as the final diagram.
MATRIX DATA ANALYZIS

• When data to be analyzed are not many, matrix diagram can be used effectively.
• To analyze large volume of data, matrix data analysis is used.
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• Matrix data analysis deals with numerical data.
BENCH MARKING
Introduction
Benchmarking involves management identifying the best firms in their industry, or
any other industry where similar processes exist, and comparing the results and
processes of those studied (the "targets") to one's own results and processes to learn
how well the targets perform and, more importantly,how they do it
Bench marking is the comparison of the processes and systems of a given business
function across companies. It is a way for managers and employees to compare
their functional performance to that of other companies. It can be defined as
Measuring your performance against that of best in-class companies

Analyzing how (methods) the best achieve theirperformance level.
Using the information as the basis for evaluating your own targets, strategy
and applications.
Involvement and improvements are not limited to employees. In some cases,

customers and suppliers are involving group problem solving.
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DEFINITION
“Bench marking is the process of identifying, understanding, and adapting
outstanding practices from organizations anywhere in the world to help your
organization improve its performance”.
Thefollowingisanexampleofatypicalbenchmarkingmethodology:
Identify your problem areas –
Because benchmarking can be applied to any business process or function,
a range of research techniques may be required. They include: informal
conversations with customers, employees, or suppliers; exploratory research
techniques such as focus groups; or in-depth marketing research,
Reasons to Bench Marking
Its aims at a goal setting process to facilitate comparison with the best To measure the
relative performance of the organization.
To analyze and determine how the best company has achieved its performance level so
that the same strategy can be followed.
The information can be used to relatively evaluate or rank our targets and strategies
presently followed.
It aims at searching for industry best practices

Bench Marking Concept
Whatisourpresent What are others

performance level? performance levels?
Bench Marking Process
The benchmarking process consists of five phases:

Gap analysis between our own company practices and other superior practicesAssimilating and
understandingtheprevalentbestpracticesinindustries to find out ―What must be changed‖Recognizing and
identifying the ― bench marking partner‖ andstudying there bestpractices.Executing andimplementing bench
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marked practices at our own unit to achieve the target.Evaluating the results and outcomes to determine
where we stand after implementing the changes.
I.Planning.
The essential steps are those of any plan development: what, who and how.
Earmark what is to be benchmarked? Identifying the best competitor
Determine the data collection method and the start collecting data
What is to be benchmarked? Every function of an organization has or delivers a ―product‖ or output.
Benchmarking is appropriate for any output of a process or function, whether it‘s a physical good, an order,
a shipment, an invoice, a service or a report.
To whom or what will we compare? Business-to-business, direct competitors are certainly prime
candidates to benchmark. But they are not the only targets. Benchmarking must be conducted against the
best companies and business functions regardless of where they exist.
How will the data be collected? There‘s no one way to conduct benchmarking investigations.
There‘s an infinite variety of ways to obtain required data – and most of the data you‘ll need are readily and
publicly available. Recognize that benchmarking is a process not only of deriving quantifiable goals and
targets, but more importantly, it‘s the process of investigating and documenting the best industry practices,
which can help you achieve goals and targets.
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II.Analysis.
The analysis phase must involve a careful understanding of your current process and practices, as well as
those of the organizations being benchmarked. What is desired is an understanding of internal performance
on which to assess strengths and weaknesses.
Ask:
Is this other organization better than we are? Why are they better?
By how much?
What best practices are being used now or can be anticipated?
How can their practices be incorporated or adapted for use in our organization?
Answers to these questions will define the dimensions of any performance gap: negative, positive or parity.
The gap provides an objective basis on which to act—to close the gap or capitalize on any advantage your
organization has.
III.Integration.
Integration is the process of using benchmark findings to set operational targets for change. It involves
careful planning to incorporate new practices in the operation and to ensure benchmark findings are
incorporated in all formal planning processes.
Steps include:
Gain operational and management acceptance of benchmark findings. Clearly and convincingly
demonstrate findings as correct and based on substantive data.
Develop action plans.
Communicate findings to all organizational levels to obtain support, commitment and ownership.
IV.Action.
Convert benchmark findings, and operational principles based on them, to specific actions to be taken. Put
in place a periodic measurement and assessment of achievement. Use the creative talents of the people who
actually perform work tasks to determine how the findings can be incorporated into the work processes.
Any plan for change also should contain milestones for updating the benchmark findings, and an ongoing
reporting mechanism. Progress toward benchmark findings must be reported to all employees.
V.Maturity.
Maturity will be reached when best industry practices are incorporated in all business processes, thus
ensuring superiority.
Tests for superiority:
If the now-changed process were to be made available to others, would a knowledgeable businessperson
prefer it?
Do other organizations benchmark your internal operations?
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FAILURE MODE AND EFFECT ANALYSIS
Introduction
Failure Mode Effect Analysis is an analytical technique that goes in for combining Technology and Experience of people
to identify foreseen failures in a product or process and planning to eliminate the Failure.
MEANING
Failure mode and effect analysis (FMEA) also known a risk analysis is a preventive measure to systematically display the
causes, effects and possible actions regarding observed failure.
The objective of FMEA is to anticipate failures and prevent them from occurring. FMEA priorities failures and attempts to
eliminate their causes.
FMEA is an engineering technique used to define, identify and eliminate known and/ or potential failures, problems, errors
which occur in the system, design process and service ‗ before they reach the customers‘
TYPES OF FMEA
Major Classification
Design FMEA
Process FMEA Sub Classification
Equipment FMEA
Maintenance FMEA
Service FMEA
System FMEA
1.Design FMEA
Design FMEA involves the analysis of the potential failures of product or service due to component or subsystem
unreliability
Design FMEA is to establish priorities based on expected failures and severity of those failures.
2.Process FMEA
Process FMEA involves a failure analysis of a manufacturing process.
The process FMEA is used primarily to identify areas of critically of control and to emphasize the design and more
reliable.
FAILURE RATE
Products follow a pattern of failure.
There is no information about the reliability (i.e. Failure) of the product.
Failure Rate is a constant is known period of failure can be found out using Exponential Distribution
Rt = e – λt Rt = Reliability of survival
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Rt = e - t / θ t = Time for operation without failure
λ = Failure rate θ = Mean time to Failure
BENEFITS OF FMEA
Improve product/process reliability and quality Increase customer satisfaction
Early identification and elimination of potential product / process failure modes.
Prioritize product /process deficiencies
Capture engineering/ organizational knowledge
Document and track the actions taken to reduce risk Provide focus for improved testing and development. Minimize
late changes and associated cost.
FMEA PROCEDURE
1.Describe the product/process and its function
2.Create a block diagram of the product/ process:
It shows the relationship of components and establishes a structure, which the FMEA can be developed.
3.Complete the header of the FMEA form worksheet.
Changing team leader, team members if it‘s needed
4.List product/process function
5.Identify failure modes
A failure mode is defined as the manner in which a component, subsystem, system, process, etc., could potentially fail to
meet the design purpose.
Examples of potential failure modes include- corrosion, torque, fatigue, deformation, cracking, electrical short or open and
hydrogen embitterment.
6.Describe the potential failure effects:
A failure effect is defined as the result of a failure mode on the function of the product/process as perceived by the customer
Examples of failure effects include: injury to the user, impaired operation, poor appearance, odors, noise and degraded
performance.
7.Establish the numerical ranking for the severity of the effect.
8.The ClASS column is used to classify any special product characteristics for components, sub-systems, or systems that
may require additional process controls.
9.Identify the potential causes/ mechanisms of failure.
Example:- improper torque applied, improper operating conditions, improper alignment, excessive loading etc.,
10.Enter the probability factor.
A numerical weight should be assigned to each cause that indicates how likely that cause. (i.e., probability of the cause
causing)
11.Identify current control
12.Determine the likelihood of deduction
The likelihood of detection is also based on a 1 to 10 scale, with 1 being the certain of detection and 1- being the absolute
uncertainty of detection.
13.Review Risk Priority Number (RPN)
The risk priority number is defined as the product of Severity(S),
Occurrence (O), and detection (D) rankings
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i.e., RPN = Severity x Occurrence x Detection
14.Determine the recommended actions
15.Assign responsibility and a target completion date for these actions. This makes responsibility clear cut and facilities
tracking
16.Indicate actions taken..
17.Update the FMEA as the design or process changes, the assessment changes or new information becomes known.
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Unit IV – TQM TOOLS & TECHNIQUES II
QUALITY FUNCTION DEPLOYMENT
It is a structured method that is intended to transmit and translate customer requirements, that is, the
Voice of the Customer
Through each stage of the product development and production process, that is, through the product realization cycle.
These requirements are the collection of customer needs, including all satisfiers, exciters/delighters, and dissatisfies.
QFD is systematic and organized approach of taking customer needs and demands into consideration while designing new
products and services (or while improving existing products and services)
QFD focuses on the „ voice of the customer ‟ i.e. customer expectation or requirements. That‘s why QFD is sometimes as
“Customer Driven Engineering‖
Definition
Quality Function Deployment may be defined as a system for translating consumer requirements into appropriate
requirements at every stage, from research through product design and development, to manufacture, distribution,
installation and marketing sales and services.
Objectives
To identify the true voice of the customer and to use this knowledge to develop products which satisfy customers
To help in the organization and analysis of all the relevant information associated with the project.
In short the QFD aims at translating the customer voice (or) requirements into products specifications
QFD PROCESS
QFD is a team based management tool. Here customer expectations are used to drive the product development process. In a
typical QFD application, a cross functional team creates and analysis a matrix linking customer wants and needs to a set of
product and service designs metrics that the company can then measure and control.
Phase-I
Product planning
List of customer requirements (What‘s)
List technical descriptors (How‘s)
Develop a relationship matrix between What and How
Develop an interrelationship matrix between How‘s
Do competitive assessments
Develop prioritized customer requirements‘
Develop prioritized technical descriptors
Phase- II
Part Development
Deploy QFD process down to sub- components level both in terms of requirements and characteristics
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Deploy the component deployment chart. Relate the critical sub- component control characteristics
Phase – III Process Planning
Develop the relationship between the critical characteristics and process used to create the characteristics
Develop the control plan relating critical control to critical processes
Phase-IV
Production planning
Tabulate operating instructions from process requirement
Develop prototype and do testing
Launch the final product to the market
There are many benefits to be realized by using Quality Function Deployment (QFD), including the following:
Customer driven:
The focus is on customers wants, not what the company thinks the customer wants. The "Voice of the Customer" drives the
development process.
Competitive analysis:
Other products in the marketplace are examined, and the company product is rated against the competition.
Reduced development time:
The likelihood of design changes is reduced as the QFD process focuses on improvements to be made to satisfy key
customer requirements. Careful attention to customer requirements reduces the risk that changes will be required late in
the project life cycle. Time is not spent developing insignificant functions and features.
Reduced development costs:
The identification of required changes occurs early in the project life cycle. Minimizing changes following production
reduces warranty costs and product support costs.
Documentation:
A knowledge base is built as the QFD process is implemented.
A historical record of the decision-making process is developed
BENEFITS OF QFD
Promotes better understanding of customer demands Improve customer satisfaction
Promotes team work
Facilitates better understanding of design interactions Concentrates on design efforts
Introduce new design to the market faster.
Breaks down barriers between functions and departments
HOUSE OF QUALITY ( Tools of QFD)
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TAGUCHI’S QUALITY LOSS FUNCTION

Taguchi’s Quality Loss Function concept combines cost, target and variation in one
metric withspecifications being of secondary importance.
Taguchi has defined quality as the loss imparted to society from the time a product
is shipped. Societal losses include failure to meet customer requirements, failure to
meet ideal performance and harmful side effects.
USTOMERS PERCEIVE QUALITY AS MEETING THE TARGET

RATHER
THAN JUST MEETING THE SPECIFICATIONS.
There are three common quality loss functions
1. Nominal - the - best.
2. Smaller - the - better.
3. Larger - the – better
NOMINAL – THE – BEST :
Although Taguchi developed so many loss functions, many situations are

approximated by the quadratic function which is called the Nominal – the –
best type.
Quadratic Los
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The quadratic function is shown in figure. In this situation, the loss occurs as soon
as the performance characteristic, y, departs from the target τ.
At τ, the loss is Rs. 0.
At LSL (or) USL, the loss is Rs. A.
The quadratic loss function is described by the equation L = k (y - τ) 2. Where,
L = cost incurred as quality deviates from the target.

y = Performance characteristic
τ = target
k = Quality loss coefficient.

The loss coefficient is determined by setting ∆ = (y – τ), the deviation from the
target. When ∆ is the
USL (or) LSL, the loss to the customer of repairing (or) discarding the product is Rs.
A.
Thus,
K = A / (y – τ)2 = A / ∆2 .
SMALLER – THE – BETTER :
The following figure shows the smaller – the – better concepts.
The target value for smaller – the – better is 0. There are no negative values for the
performance characteristic.
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The radiation leakage from a microwave appliance, the response time for a
computer, pollution from an automobile, out of round for a hole etc. are the
performance characteristics for this concept.
LARGER – THE – BETTER :
The following figure shows the concept of the Larger – the – better.
In the Larger – the – better concept, the target value is ∞ (infinity), which gives
a zero loss. There are no negative values and the worst case is at y = 0. Actually,
larger – the – better is the reciprocal of smaller – the – better. The performance
characteristics in Larger – the – better are bond strength of adhesives, welding
strength etc.
Taguchi quality loss function
Genichi Taguchi is a Japanese quality expert, known for the Quality Loss
Function and for methodologies to optimise quality at the design stage – ―robust
design. Taguchi received formal recognition for his work including Deming Prizes
and Awards. Genichi Taguchi considers quality loss all the way through to the
customer, including cost of scrap, rework, downtime, warranty claims and
ultimately reduced market share.
Genichi Taguchi's Quality Loss Function
The Quality Loss Function gives a financial value for customers'

increasing dissatisfaction as the product performance goes below the desired target
performance. Equally, it gives a financial value for increasing costs as product
performance goes
above the desired target performance. Determining the target performance is an

educated guess, often based on customer surveys and feedback.
The quality loss function allows financial decisions to be made at the design
stage regarding the cost of achieving the target performance.
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Quality through Robust Design Methodology
Taguchi methods emphasised quality through robust design, not quality

through inspection. Taguchi breaks the design process into three stages:
1. System design - involves creating a working prototype

2. Parameter design - involves experimenting to find which factors influence
product performance most
3. Tolerance design - involves setting tight tolerance limits for the critical factors
and looser tolerance limits for less important factors.
Taguchi‗s Robust Design methodologies allow the designer through

experiments to determine which factors most affect product performance and
which factors are unimportant.
The designer can focus on reducing variation on the important or critical factors.
Unimportant or uncontrollable ―noise factors have negligible impact on the
product performance and can be
ignored.
Robust Design of Cookies This is easier explained by example. If your

business makes cookies from raw ingredients, there are many possible factors that
could influence the quality of
the cookie - amount of flour, number of eggs, temperature of butter, heat of oven,
cooking time, baking tray material etc. With Genichi Taguchi‗s Robust Design
methodologies you would set up
experiments that would test a range of combinations of factors - for example, high
and low oven temperature, with long and short cooking time, 1 or 2 eggs, etc. The
cookies resulting from each of these trials would be assessed for quality. A
statistical analysis of results would tell you which the most important factors are, for
example oven temperature affects cookie quality more than the number of eggs.
With this knowledge you would design a process that ensures the oven maintains the
optimal temperature and you would be able to consistently produce good cookies.
What Is TPM?
TPM (Total Productive Maintenance) is a holistic approach to equipment maintenance that strives
to achieve perfect production:
No Breakdowns
No Small Stops or Slow Running
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No Defects
In addition it values a safe working environment:
No Accidents
TPM emphasizes proactive and preventative maintenance to maximize the operational efficiency
of equipment. It blurs the distinction between the roles of production and maintenance by placing
a strong emphasis on empowering operators to help maintain their equipment.
The implementation of a TPM program creates a shared responsibility for equipment that
encourages greater involvement by plant floor workers. In the right environment this can be very
effective in improving productivity (increasing up time, reducing cycle times, and eliminating
defects).
The 5S Foundation
The goal of 5S is to create a work environment that is clean and well-organized. It consists of five
elements:
Sort: eliminate anything that is not truly needed in the work area
Straighten: organize the remaining items
Shine: clean and inspect the work area
Standardize: create standards for performing the above three activities
Sustain: ensure the standards are regularly applied
It should be reasonably intuitive how 5S creates a foundation for well-running equipment. For
example, in a clean and well-organized work environment, tools and parts are much easier to find,
and it is much easier to spot emerging issues such as fluid leaks, material spills, metal shavings
from unexpected wear, hairline cracks in mechanisms, etc.
The Eight TPM Pillars

The eight pillars of TPM are mostly focused on proactive and preventative techniques
for improving equipment reliability.
Pillar What Is It? How Does It Help?
Autonomous Places responsibility  Gives operators greater “ownership”

Maintenance for routine
of their equipment.
maintenance, such as
 Increases operators’ knowledge of
cleaning, lubricating,
and inspection, in their equipment.
the hands of  Ensures equipment is well-cleaned
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operators. and lubricated.

 Identifies emergent issues before they
become failures.
 Frees maintenance personnel for
higher-level tasks.
Planned Schedules  Significantly reduces instances of

Maintenance maintenance tasks
unplanned stop time.
based on predicted
 Enables most maintenance to be
and/or measured
failure rates. planned for times when equipment is not
scheduled for production.
 Reduces inventory through better
control of wear-prone and failure-prone
parts.
Quality Design error  Specifically targets quality issues

Maintenance detection and
with improvement projects focused on
prevention into
removing root sources of defects.
production
processes. Apply  Reduces number of defects.
Root Cause Analysis  Reduces cost by catching defects
to eliminate early (it is expensive and unreliable to
recurring sources of
find defects through inspection).
quality defects.
Focused Have small groups  Recurring problems are identified and

Improvement of employees work
resolved by cross-functional teams.
together proactively
 Combines the collective talents of a
to achieve regular,
incremental company to create an engine for
improvements in continuous improvement.
equipment operation.
Early Directs practical  New equipment reaches planned
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Equipment knowledge and performance levels much faster due to

Management understanding of
fewer startup issues.
manufacturing
 Maintenance is simpler and more
equipment gained
through TPM robust due to practical review and
towards improving employee involvement prior to
the design of new installation.
equipment.
Training and Fill in knowledge  Operators develop skills to routinely

Education gaps necessary to
maintain equipment and identify emerging
achieve TPM goals.
problems.
Applies to operators,
maintenance  Maintenance personnel learn
personnel and techniques for proactive and preventative
managers. maintenance.
 Managers are trained on TPM
principles as well as on employee
coaching and development.
Safety, Health, Maintain a safe and  Eliminates potential health and safety
Environment healthy working
risks, resulting in a safer workplace.
environment.
 Specifically targets the goal of an
accident-free workplace.
TPM in Apply TPM  Extends TPM benefits beyond the

Administration techniques to
plant floor by addressing waste in
administrative
administrative functions.
functions.
 Supports production through
improved administrative operations (e.g.,
order processing, procurement, and
scheduling).
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Customers
1. Number of complaints from customers.
2. Number of on-time deliveries.
3. Warranty data.
4. Dealer satisfaction.
Production
1. Inventory.
2. SPC Charts.
3. Amount of scrap / rework.
4. Machine down time.
Research and Development
1. New product time to market.
2. Design change orders.
3. Cost estimating errors
Suppliers
1. On-time delivery.
2. Service rating.
3. Quality performance.
4. Average lead time.
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Marketing / Sales
1. Sales expense to revenue.
2. New product sales to total sales.
3. New customers.
Administration
1. Revenue per employee.
2. Purchase order error.
3. Billing accuracy.
4. Cost of poor quality.
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QUALITY STATEMENT:
VISION STATEMENT:
• It is a short declaration of what an organization aspires to be tomorrow. It is an ideal state
which may never be achieved.
Satisfy 3 fundamental criteria
1. It must address all levels
2. It must be stated in such a way that every one believes in it, and
3. It should be aggressive and growth- orientated.
MISSION STATEMENT:
• Describes the function of the organization. It provides the clear statement of purpose for
the employees, customers and suppliers.
• It addresses the issues of:
1. Contribution to society,
2. Respect for environment and people,
3. Commitment to quality for customers , suppliers employees
4. Pride in workmanship, etc.
Example:
• “ Facilitating world class technical education through high quality institutions, academic
excellence and innovative research and development programmes , technology forecasting
and global manpower planning, promoting industry institute interaction , inculcating
entrepreneurship” - AICTE
QUALITY POLICY STATEMENT:
• It is a guide for everyone in the organization as to how they provide products and services
to the customer. Written by the CEO feed backfrom workforce and approved by quality
council.
1.14Business Process Reengineering
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Business process reengineering (BPR) is redesigning business processes in the organisation. BPR
brings radical changes in the processes those generate value to the customers. Business process
reengineering is a dramatic change initiative which is processed in four steps:
(i) Start from beginning / scratch;
(ii) Identification of goals and purposes;
(iii) Analysis of current processes; and
(iv) Action time. It makes the employees to be more productive for their customers not their
bosses.
It generates empowered employees who work in process teams rather in functional departments.
The controlled employees are empowered employees who are read to perform multidimensional
work. BPR helps to understand and measure the existing processes. It helps to develop a vision
and sense of belonging among employees.
It lowers cost and increases customers’ satisfaction. It helps organisation to face competitiveness
and generates excellent capability advantages. It helps to improve efficiency. It helps to develop
solution and make new processes operational. Sometimes, BPR fails because the organisation is
failed to focus on the customers’ needs and satisfaction level. The organisation may fail to
integrate information technology. Sometimes, the managers get confused and assumed that the
change will bring insecurity.
Unit V – QUALITY MANAGEMENT SYSTEM
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1.0 Objectives
After going through this lesson, you will be able to:
Elaborate the concept of JIT, pre-requisites of JIT Implementation and benefits of JIT system.
Understand the concept, meaning, importance of IS0-9000.
Know the importance, significance and process of Quality Audit.
1.1Just In Time (JIT): Introduction
Just-in-time was invented by Taiichi Ohno of Toyota Motor Company in Japan shortly after
World War II. It is a management philosophy which involves providing the right items of the right
quality and quantity at the right place and at the right time. JIT is not merely an inventory
reduction programme, but is much broader in effect so that the organization operates more
efficiently and with minimum resources. (Mukhopadhyay, 1995) JIT is an inventory strategy in
which companies increase efficiency and decrease waste by receiving materials only as they are
needed in the production process, thereby reducing inventory costs. JIT is an all-encompassing
philosophy found on eliminating waste. Anything that does not add value to process is called
waste.
The success of just-in-time (JIT) on the production floor in reducing costs, improving quality and
enhancing responsiveness has led many firms to attempt to extend the philosophy to the entire
supply chain. The application of JIT to the sourcing arena has become more important in the past
few years because the value of purchased inputs, as a percentage of costs of goods sold, has
increased steadily in many production environments. Research has indicated that a firm will
source outside its home borders if it expects to achieve dramatic and immediate improvement in
four critical areas: (Humphreys, Yeung, 1998)
Cost reduction
Quality improvement
Increased exposure to technology
Delivery and reliability improvements
1.2Definitions of JIT
Just-in-time is a philosophy which means producing only what is needed, when it is needed, not
early, not late; not less, not more. The key target is achieving high volume production using
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minimal inventories. It is an integrated but simplified system. The JIT mandate is the elimination
of all types of waste in the organisation. According to this philosophy, anything which is not
generating value is called waste.
Just-in-time (JIT) is a highly coordinated processing system in which goods move through the
system, and services are performed, just as they are needed. Supplies and components are ‘pulled’
through the system to arrive where they are needed when they are needed.
Just-in-time is defined as the production of the minimum number of units in the smallest possible
quantities at the latest possible time, which eliminates the need for inventory. It does not mean to
produce on time but to produce “just in time”.
JIT is defined as an approach for providing smoother production flows and making continual
improvements in processes and products. (Svensson, 2001)
The fundamental aim of JIT purchasing is to ensure that production is as close as possible to a
continuous process from receipt of raw materials/components through to the shipment of finished
goods. The success and resulting performance of purchasing system is based upon cooperation
between the purchaser and supplier. Some of the elements of this system are as follows: (i)
smoothed flow of materials between suppliers and buyers;
(ii) order cost reduction; (iii) stock reduction; (iv) quality; and (v) product simplification
(Gunasekaran, 1999).
JIT is more than an inventory system. It is an operational philosophy which includes:
Short lead time
A maintenance improvement system
A quality improvement system
A productivity improvement system
Minimum inventory-level
Closely coupled flow-lines
1.3Pre-requisites of JIT Implementation

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Top management is responsible for change in the organisation. For that sake, it has to create an
environment in the organisation. The management has to develop a culture in the organisation. In
order for JIT implementation to be successful, the organisation must frame these policies
regarding JIT and must get commitment from the employees to follow the guidelines lead down
in the policies by words and means. The implementation of JIT is not just for the sake of change.
Most of the organisations implement JIT just for the sake to beat the competitors. In this way they
miss the true essence of the philosophy and the results are like half-hearted. The success of JIT
philosophy lies in the commitment of the employees. This philosophy covers the whole
organisation under one umbrella. All the departments have to work with coordination and follow
the guidelines with full spirit. The top executives have to be the leaders involved in JIT and they
must be the guiding light for all the employees. So, the success of JIT philosophy depends upon
the strategic planning that runs deep in the commitment of all the departments and all the
employees. Getting everyone involved and committed is the first step to successful
implementation of JIT and the first step to an increase in continuous improvement.
JIT has an enormous impact on a company’s profitability, especially in a competitive environment

characterized by small profit margins. Furthermore, the application of JIT technologies such as
small lot size, lead time reduction and quality improvement play a significant role in achieving
JIT purchasing. (Yang & Pan, 2007) The benefits are as follows:
Part Costs – Low scrap costs; low inventory carrying costs
Quality – fast detection and correction of unsatisfactory quality, and ultimately higher quality
purchased parts
Capital requirements – reduced rework inventories of purchased parts, raw materials, work-in-
progress and finished goods.
Administrative efficiency – fewer suppliers; minimal expediting and order release work;
simplified communications and receiving activities. (Chung & Bakar, 2001)
Other financial benefits of JIT include:
Lower investments in factory space for inventories and production;
Less obsolescence risk in inventories;
Reduction in scarp and rework;
Decline in paperwork;
Reduction in direct material costs through quantity purchases. (Kootanaee, Babu, Talari, 2013)
Benefits of JIT implementation include:
Reductions in lead-time ;
Inventory-levels reduction;
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Consistent quality improvement culture;
Zero wastage in the organisation;
Involvement of employees;
Stabilize production schedules;
Increased equipment utilization; and
Reduction in customer-related problems
Applications of JIT are as follows:
Inventory Reduction as a Tool for Improvement
Inventory reduction is directly related with cost. Costs are reduced greatly if inventory is reduced.
Waste Reduction
If any activity that increases cost but does not add value to any process in an organisation is called
waste. Eliminate waste of labor, material or equipment. JIT advocates zero waste in organisation.
Supplier Relationships
There must be good relationship with suppliers. Its helps in getting raw material supply exactly
when required.
Minimum batch sizes
The batch sizes must be kept as small as possible. The defects can be observed easily in small
batches. Minimum Movements
The movements must be kept low in production plants. The computerized equipments are very
much helpful in minimising the movements in the plants.
Total Quality Assurance
The production department must control all the processes time to time to control the variation in
the production output in terms of quality. Proper training is very much in the total quality
assurance.
Preventive Maintenance
The inspection after the accident is useless. Preventive maintenance is needed to reduce variation
in the process. This requires a regular and complete examination of all the processes on a regular
basis.
1.5ISO-9000: Introduction (International Organisation for Standardisation)
Today is the world of competition and the industries require quality tools to compete and improve
the quality of their products and services. It’s a very simple to take decision by any organisation
to implement ISO-9000. However, without a set of standards it is very difficult to say from where
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to start and how to start this quality improvement programme? They need standardisation of all
the processes to deliver consistent quality to their customers. Generally, the organisations develop
standards and guidelines for quality management and quality control purposes. For the same
purpose, i.e., to standardise quality requirements, the delegates from 25 countries met at the
Institute of Civil Engineers in London in 1946. They decided to create a new international
organization for unification of industrial standards all over the world. The new organisation, ISO,
officially began operations from the very next year. ISO stands for International
Oganisation for Standardisation. It has members from 163 countries. The organisation has formed
3,368 technical bodies for standard development. ISO’s headquarter is in Geneva, Switzerland
with more than 150 official staff to facilitate the international coordination. ISO-9000 is helpful to
show the customers that the organisation have adopted quality procedures, quality processes and
quality standards. It helps external auditors to show that all the internal processes are in place and
well documented
ISO is a nongovernmental, worldwide organisation that encompasses the international standards.

ISO is derived from the Greek word ‘isos’, meaning ‘equal’. ISO is the world’s largest developer
of International Quality Standards. The organisations certified with ISO-9000 are assured to have
International Quality Standards. The ISO-9000 was developed to effectively design and
implement efficient quality systems. The quality standards given by ISO have some specifications
for standardisation of products, services and good practice. These standards are developed to help
organisation work effectively. The ISO-9000 standards provide a framework that can provide
guidance for the processes to be made auditable. These standard practices help the organisations
to be more efficient and effective. ISO has published more than 19,500 International Quality
Standards covering almost all the areas of technology, manufacturing and business. To follow ISO
standards is voluntary. It is not legally to require these standards. But, ISO standards are
recognised internationally as these are made by experts and market driven. The ISO quality
standards are frequently followed for food safety, data security, agriculture, healthcare industry,
information technology, textile, food processing industry education & training etc. Quality
Standards developed by ISO impact our lives by giving consistent & confirmed quality and
standard products. In fact, it is helpful in raising our standard of living.
1.6Meaning of Standard
A standard is a document that provides requirements, specifications, guidelines or characteristics.

It can be used consistently to ensure that materials, products, processes and services are fit for
their purpose. More than 19500 International Standards can be purchased from the ISO store.
Originally ISO-9000 standard was published in 1987. It has undergone revisions in 1994, 2000
and 2005. It covers definitions, requirements and continual improvements. The standards are
revised at least once in a five year. It can be maintained, modified, or withdrawn.
1.7Standard Format
⚫ International standards format is:
ISO[/IEC] [/ASTM] [IS] nnnnn[-p]:[yyyy] Title, where nnnnn is the number of the standard, p is
an optional part number, yyyy is the year published, and Title describes the subject.
⚫ IEC for International Electro-technical Commission is included if the standard results from the
work of ISO/IEC JTC1 (the ISO/IEC Joint Technical Committee).
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Examples:
i)ISO/IEC TR 17799:2000 Code of Practice for Information Security Management
ii)ISO/TS 16952-1:2006 Technical product documentation — Reference designation system
10
iii)ISO/IEC Guide 2:2004 Standardization and related activities — General vocabulary
1.8Eight Principles of Quality Management
ISO standards are based on eight principles of quality management that can be applied by senior
managers to improve their organisation:
i)Customer Focus
Customers are the backbone of the organisation. The organisations must have clear understanding
of the customers’ needs and do their best to meet the needs. Through regular survey the
customers’ dissatisfaction can be known.
ii)Leadership
Leaders should be ready to take the front positions at the time of problems. Only best leaders can
guide their employees the right vision.
iii)Involvement
At the time of requirement or problem, the employees can be involved and their talent as well as
skills be utilised.
iv)Process Approach
Companies’ activities are managed in the form of processes. The input, transformation and output
are managed as a process.
v)System Approach to Management
11
At this step, all the processes of the organisation are examined thoroughly.
vi)Continuous Improvements
At this step, the management should try to find the long-term and consistent solutions of the
problems.
vii)Right Approach of Decision Making
The decision making must be based on the relevant data and information subsequently.
viii)Long Term Relationships with Suppliers
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Long term relationships with the suppliers create value.
If, the company has problem(s) like high customer complains, dissatisfaction, poor employees
turnover, increased absenteeism, shrinking market share etc. these problems can be managed with
the help of having customer focus, leadership, employees’ involvement and with right process
approach.
1.9Process for Getting ISO Certificate
Organizations willing to achieve ISO-9000 certification require the following steps:
Step I: The first step is to think and decide at top management about why the organisation should
get the ISO-9000 certification, the benefits of the ISO-9000 and the quality culture required in the
organisation
12 Step II: Go through the requirements mentioned in the ISO-9000 standards. Compare the
existing work practices being followed in the company with the standards and identify gaps
against requirements mentioned in ISO-9000 standards.
Step III: Prepare action plan describing work to be done to fulfil the gap.
Step IV: Arrange trainings to all employees of organization about how to fulfil the gap and
achieve ISO-9000 certificate requirements.
Step V: Complete necessary documentation like manual, procedures preparations.
Step VI: Follow the requirements defined in the ISO-9000 standards in routine and overcome
difficulties in following the standards.
Step VII: Conduct internal audit.
Step VIII: Contact ISO certification agencies and sign a 3 years contract with them.
Step IX: After ensuring adequate preparations for audit, call certification agency for stage 1 audit.
Step X: Fulfil the gap/shortcomings given by certification agencies during stage 1 audit.
Step XI: Call certification agency for stage 2 (final) certification audit.
Step XII: Fulfil the gap/shortcomings given by certification agency during stage 2 certification
audit.
Step XIII: You will receive ISO-9000 certificate after 4-6 weeks of successful completion of stage
2 certification audit.
13.Step XIV: The organisation can use ISO-9000 logo as per recommendation of certification
agency.
1.10Benefits of ISO-9000
There are many benefits of ISO-9000 as followings:

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Standardisation Process
ISO-9000 standards are recognised internationally. It assures all the processes are standardised.
These standards help organisations to work effectively. These standards bring technological
uniformity. They help to standardise the processes of manufacturing of products and services.
Quality Purpose
ISO certification assures customers that the organisation has designed and managed its process
according to the standards led down by ISO to assure delivery of a quality product. Conformity to
ISO-9000 assures consumers that products and services are safe, reliable, efficient and meeting all
the quality parameters.
Waste Reduction
ISO certification is helpful in setting standard processes which lead to reduction in scraps, wastes
etc.
Accessibilities of New Markets
The standards help companies to access new markets. It facilitates free and fair global
trade.
Cost Reduction
The ISO-9000 is beneficial for the organisations because it is helpful in cost savings as the
operations are standardised and wastes, errors are lowered drastically.
Customers’ Satisfaction
Ultimately the customers get quality products and services which generate customer satisfaction.
Increase in customer satisfaction and increase in sales means the market size of the organisation is
increasing. ISO-9000 standards on road safety, toy safety and secure medical packaging help to
make the world a safer place for happy living.
TQM in Service Sector
American Marketing Association defines service as activities, benefits or satisfactions, which are
offered for sale, or are provided in connection with the sale of goods. “Services are economic
activities offered by one party to another: often time-based, performances bring about desired
results to receipts, objects, or other assert for which purchaser have responsibility. In exchange for
money, time, and effort, service customers expect value from access to goods, labor, professional
skills, facilities, networks, and systems; but they do not normally take ownership of any of the
physical elements involved Lovelock et al. (1996)”.
Stanton, 1986 says services are those separately identified, and essentially intangible, activities
that provide want of satisfaction and that are not necessarily tied to the sale of a product or another
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service. Kotler (1993) defines services as any kind of performance that one party can offer to
another that is essentially intangible and does not results in the ownership of anything. As
observed by Mohanty and Lekhi (2002) [11] there are four important characteristics of services i.e.,
intangibility, perishability, inseparability and heterogeneity. On the whole service sector integrates
all the above components, involving a large number of staffs working with a definite purpose to
satisfy different needs of the customers.
Depending on the above theories and facts, the application partwill be represented in this chapter.
This chapter will identify, analyze andaddress the key TQM practices in three hotels and the
difference between themin terms of their performance in TQM.
This chapter leads to a clear picture of how critical factorsof TQM are implemented in the
three hotels which have advantages to providebetter service to customers through reporting and
analyzing a paper written byIsmail Sila and Maling Ebrahimpour on An Examination of Quality
Management inLuxury Hotels. A thorough study will be done in investigating the case study.This
chapter will start with the summary of the case study, then analysis and lastlyfindings of the
selected case study.
4.1 Summary on the Case Study
The case study is an examination of quality management in 3luxury hotels in the United
States (US). The main aim of the case study is toanalyze and compare the Total Quality
Management (TQM) at the selected 3 luxuryhotels. The case study uses MBNQA principles at
analyzing and comparing the TQMat the 3 hotels and looks at the leadership, strategic planning,
customer andmarket focus, information and analysis, human resources focus, processmanagement
and business results of the 3 hotels. The case study concludes thatthe 3 most significant TQM
factors that have been successfully implemented areleadership, guest and market focus, and
information and analysis. However, thehuman resource focus factor was less successfully
integrated into Hotel A’soperations. The authors also find out that all 3 hotels implementation of
TQMis not well well-designed or complex as in many other quality-consciouscompanies and
strategic planning is the most difficult challenge that thehotels is facing especially for Hotel A.
4.2 Analysis and Findings
Concepts, Principles and Philosophies of Quality Used inthe Case Study
In the case study, the concepts,principles and philosophies are based on the practice of Total
Quality Management (TQM). TQM places a greatemphasis on customer-oriented, leadership,
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strategic planning, employeeresponsibility, continuous improvement, cooperation, statistical

methods, andtraining and education. One of the centreprinciples of TQM is the customer aim
which emphasizes the service relationshipbetween an organization/institution and its customers.
(TQM)methodology can help organizations to achieve business excellence by improvingcustomer
satisfaction (both internal and external), cost effectiveness andcompetitive advantage
(SMEToolkit, 2011). This is very important and very practical to thehospitality industries. It is
because in a hotel, quality problems will lead tocomplaint by customers and it will immediately
affect the hotel performance atevery level. The importance of the clientele is also the main focal of
MalcolmBaldrige National Quality Award (MBNQA) wheremost points a firm can obtain are
founded on enterprise outcomes which includecustomer approval especially in hospitality
industries.
According to the author, TQMquality gurus have been critical in analyzing management
principles andphilosophies and these gurus such as Crosby(1979) recommended a 14-step
program to improve quality through defectprevention, Deming (1986) prescribed 14 points
encompassing the organizationalrequirements for effective quality management, Feigenbaum
(1983, 1991)prescribed ten fundamental benchmarks as the keys to the successfulimplementation
of total quality control in the 1990s, and Juran (1989) offered a framework for TQM thatinvolves
three sets of processes including quality planning, qualityimprovement, and quality control. In this
case study, the authors are usingMBNQA, one of the principles and philosophies that is under
TQM. The MBNQA or known as the Baldrige Awardis a performance excellence award given to
any of U.S. organizations thatinvolves in business, health care, education, and nonprofit sectors. It
isgiven for their quality and excellence performance. The award promotesawareness of
performance excellence as an increasingly important element incompetitiveness. The award is
judged by an independent board of examiners andrecipients are selected based on MBNQA
Criteria for Performance Excellencewhich looks at the achievement and improvement in seven
areas. The areas are leadership,strategic planning, customer and market focus, information and
analysis, humanresources/workforce focus, process management/operation focus and
businessperformance results.
A comparative analysis of the TQM practices based on MBNQAcriteria was done by the
authors in the case study. The 2002 MBNQA criteria areused as a framework in comparing the
TQM practices of the 3 hotels. The selected 2002 MBNQA criteria areleadership, strategic
planning, customer and market focus, information and analysis,human resources focus, process
management and business results. Below is a summary of MBNQA taken fromKerzner (2009):
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Criteria 1: Leadership- Examines how senior executives guide the company, how the company
addressesits responsibilities to the public and how the company practices goodcitizenship.
Criteria2: Strategic Planning- Examines how the company sets strategic directions and how
itdetermines key action plans.
Criteria3: Customer and Market Focus- Examines how the company determinerequirements
and expectations of customers and markets.
Criteria4: Information and Analysis- Examines the management, effective use, and analysis of
data andinformation to support key company processes and the company's
performancemanagement system.
Criteria5: Human Resources Focus- Examines how the companyenables its workforce to
develop its full potential and how theworkforce is aligned with the company's objectives.
Criteria6: Process Management- Examines aspects of how key production, delivery, and
supportprocesses are designed, managed, and improved.
Criteria7: Business Performance Results- Examines the company's performance and
improvement in the key businessareas of customer satisfaction, financial and marketplace
performance, human resources, supplier and partnerperformance, and operational performance.
The category also examines how thecompany performs relative to competitors.
Usage of Holistic Approach in the Hotel Industry
Aholistic approach is an approach that looks at all aspects and components of asa whole. The
holistic approach states that parts of any whole cannot exist and cannot beunderstood except in
their relation to the whole. The selected case study (AnExamination of Quality Management in
Luxury Hotels) uses a holistic approach ininvestigating the TQM of the 3 hotels (two being
upscale and one deluxe) in the US. A holistic approach in the hotel industrymeans to look all the
operations of a hotel company and not only humanresource management (HRM) or guest
satisfaction that other researchers havefocused on (Sila & Ebrahimpour, 2008). In the case study,
the authors investigate 6 criteria that willdetermine the business results of the 3 hotels. The 6
criteria are leadership,strategic planning, guest and market focus, information and analysis,
humanresource focus, process management and these criteria are based on the MBNQA.Holistic
approach provides an opportunity for the hotels management to look attheir performance and the
performance does not based on a single criteria butit is based on overall performance of the hotels.
How Total Quality Management (TQM) Practices Effect on EachHotel Business Results.
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All 3 hotels claim that they have implemented TQM practices attheir hotel. The case study
finds out that Hotel A does not have any formalinitiative in the implementation of TQM, Hotel B
attempted to implement TQM,but with little success and has now implemented Six Sigma
initiative and themanagement is still under training for the Six Sigma and lastly Hotel C
hasformally implemented TQM and the general manager claims that quality isembedded in their
organizational culture. However, the case study reveals slightly different results. Thedifferent
TQM practices by the 3 hotels lead to different impacts on theirbusiness results.
Hotel A's TQM implementation mainly focuses on improvingfinancial results of the hotel.
They didn't place a lot of emphasis on otherimportant areas of performance especially human
resource results andorganizational effectiveness result. Hotel A TQM's practices didn't manage
tostrike a balance between the 4 business performance areas of MBNQA which arecustomer-
focused results, financial and market results, human resource results,and organizational
effectiveness results. They didn't realize that customer isthe focal of focus. The authors speculate
that the lack of focus on the othercomponents of the business performance and the inability to
create andstrengthen the balance of the 4 business performance results might negativelyaffect their
performance in the future.
Hotel B's TQM practices place leadership as the main driver intheir business results
performance. Leaders are held responsible for qualityand financial performance and it has
indirectly improved the hotel'sperformance. The hotel makes sure that all leaders have a clear
vision inhelping their hotel to improve. The end results show that it has a significantimpacts on the
customer-focused, financial and market, human resource andorganizational effectiveness results.
Hotel C's TQM practices on leadership, strategic planning,guest and market focus, information
and analysis, human resource focus andprocess management has managed in lowering the costs
and gaining high retentionguest rate. Lowering the costs is achieved by having a good long-
termrelationship with their supplier while gaining higher retention guest rate isachieved through
their commitment to improve their service based on thecustomer’s feedback.
Methodology and Framework Used at the Case Study
Case studies offer theopportunity for a holistic view of a process as opposed to

areductionist-fragmented view. According to the holistic view, the whole is notidentical with the
sum of its parts; consequently, the whole can only beunderstood by treating it as the central
objective of the study (Gummesson,1991). As a research endeavor, the case study contributes
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uniquely to ourknowledge of individual, organizational, social, and political phenomena;

thedistinctive need for case studies arises out of the desire to understandcomplex social
phenomena; in brief, case study allows an investigation toretain the holistic and meaningful
characteristics of real-life events (Yin,1984).
The main data collection is a comparative analysis based on asemi-structured interview

format which. This type of data collection is aqualitative method of inquiry that combines a pre-
fixed set of open questionswith the opportunity for the interviewer to enquire for further
informationbased on the response. Each of theinterviews is conducted using a question-answer
approach in gatheringinformation about the presence of quality management issues at the 3
luxuryhotels in which Hotel B and C are upscale luxury hotels and Hotel A has onlyrecently being
upgrade to upscale luxury hotel. For anonymity, the hotels arelisted as Hotel A, Hotel B and Hotel
C. The 3 selected hotels are chosen basedon their similarities of comparable services. The deluxe
hotel has elegant,distinctive, highest quality décor; upscale restaurants, full range of first-class
amenities and customizedservices while the upscale hotels have well integrated décor;
qualityfurnishings; premium guest room amenities and facilities; high staff-to-guestratio. The
general managers of Hotel A, Hotel B and Hotel C are chosen to bethe respondents for the semi-
structured interview. The director of qualitytraining/human resource coordinator from Hotel A is
also chosen to be one of theinterviewees.
The framework of the semi-structured interview is formulatedbased on the 2002 Malcolm

Baldrige National Quality Award (MBNQA). The 2002MBNQA criteria are used as a framework
in comparing the TQM practices of the 3hotels. The selected 2002 MBNQA criteriaare leadership,
strategic planning, customer and market focus, information andanalysis, human resources focus,
process management and business results.
4.3 Comparison and Analysis of the Results
The results of the case study are broken to 6 criteria whichare leadership, strategic planning,
guest and market focus, information andanalysis, human resource focus, process management.
Leadership
In Hotel A, the general manager is committed to thetransformation of the organizational

culture due to a brand upgrade fromeconomy to upscale. The general manager formed a group
made up of informalleaders throughout all the major departments so that they could be the
agentsof the new culture and disperse it to all the levels of the organization. Themanagement is
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also committed in implementing 20 Ritz-Carlton standards tofurther transform their hotel to an

upscale hotel. Meanwhile, Hotel B top leaders have a clearvision and view of the company vision
and mission and they are accountable forthe company’s financial and quality performance. All
leaders are also committedto the success of Six Sigma program which will indirectly improve
theirbusiness results. They constantly searchfor ways to improve the company’s performance in
terms of quality and profitsand employ successful teamwork activities within each hotel.
Compared to HotelA and Hotel B, Hotel C leaders use both top down and bottom up
communicationsconstantly and employee participation in decision making is highly
encouraged.The leaders work closely with the employees in maintaining their standard.
Strategic Planning
For Hotel A, their strategic plan is heavily influenced bytheir brand upgraded. The struggle
in cultural transformation becomes anintegral part of their long-term strategic plans. However,
Hotel A does notconsider employees input and supplier planning as part of their strategicplanning.
Their short term planning is based on a year plan while the long termplanning is set beyond 1 year.
For Hotel B, their strategic planning is set ata 5-year-long-term goal of redefining the hotels and
repositioning themselvesin the hotel industries. The plan aimsat melding all the key components
of hotel operations (quality and guestsatisfaction standpoint, financial standpoint, and employee
morale standpoint).The hotel’s strategies seem to be aptly aligned with its human resource
andcustomer satisfaction practices. Meanwhile for Hotel C, their strategic planconsists of short-
term and long term plans. Their short-term plans andstrategies are developed and implemented at
the property level by tracingshort-term trends and using various quality feedback
mechanisms.Quality-focused long-term plans are developed across the entire spectrum of
theorganization using all the resources available.
Guest and Market Focus
In Hotel A, information about guests is collected throughinformal and formal mechanisms.

Formal mechanism used by Hotel A includes guestcomment cards and the Guest Satisfaction
Tracking System (GSTS). A qualitycommittee will do a follow up action based on the information
collected. HotelB also uses informal and formal mechanisms in collecting information of
theirguests. Hotel B uses the Smithstar Travel Report, a proprietary computerizedsystem, market
conditions, guest satisfaction via JD Power and Associatesinformation, market share and revenue
as part of their data collection. Reviewsand changes are employed based on the data collected.
Hotel C also like Hotel Aand B uses various mechanisms in collecting information about their
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guests.Daily meetings are conducted to gather information and solve any problems arisefrom the
collected information. Hotel C also stimulates the 20 standards ofRitz-Carlton Hotel (receiver of
MBNQA). All the employees in each of the samebrand hotels in the chain are required to know
them by heart.
4.4 Information and Analysis
Hotel A's information is collected through a survey, qualityinspections and 1-800 complaint
numbers. Based on this data, Hotel A willevaluate their performance based on data and
information obtained from GSTSdatabase, quality inspections that are conducted by brand
representatives andthe guest relations scores obtained from the 1-800 numbers that the guests
callto report their complaints. On the otherhand Hotel B's information is based on yearly appraisal,
employee’sperformances and guest satisfaction. This information is tied to other criteriaincluding
strategic planning, customer focus, HRM and process management. Allinformation is available to
employees, so employees can perform better in theirjobs. Internal and external benchmarking of
their hotel compared to otherhotels and industries are also implemented, so best practices can be
createdwithin the hotel. The benchmarking is done at the corporate level. Similar to Hotel A and
Hotel B, Hotel C'sinformation and analysis on hotel's products and services are based on
customers'feedback. Hotel C also identifies 100-200 defects through ongoing inspectionusing the
hotel's developed and driven software and this data is printedmonthly and is used to identify
problems in a monthly, quarterly and annualbasis. The hotel also extensively tracks financial
success, guest satisfactionand associate satisfaction to facilitate improvements. Monthly
departmental meetings and employeesmeetings are used to disseminate information and decide on
improvementmeasures. Like Hotel B, Hotel C's benchmarking is also done at the corporatelevel
and Hotel C also collaborates with other hotels before they implement newproducts and services
based on the other hotels benchmarking too.
Human Resource Focus
The results show that Hotel A does reward their employees, butthey do not have an effective
mechanism in managing its human resourcesefficiently. Hotel A did not fully implement
employee involvement andempowerment type of programs that covers employee’s wellbeing
development.Trainings for employees are not emphasized and employees are not trainedformally
and states that the lack of infrastructure and qualified staff hascontributed to the lack of emphasis.
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Trainings are given to new employees,managers and supervisors only. In addition,communication

within the hotel is mostly top down rather than bottom up andcross communication and cross-
functional teams are seldom being utilized. HotelA has not made a huge progress in their human
resource area and the manageradmits that they cannot called themselves a quality focused
organization. Onlyrecently that Hotel A has created a human resource coordinator in order to
givemore emphasis on their human resource practices.
Unlike Hotel A, Hotel B recognizes the importance of havingprograms that can lead to
employees and managers superior performance. Employee participation in decision-making,
empowerment, formalized and comprehensivetraining and teamwork activities are fully
implemented and employee recognitionprograms are common too. Their human resource practices
are quarterlyemployee-leaders meetings, twice a month departmental teamwork activities
andtraining and monthly departmental meetings. Employees are also encouraged toactively
making their own decision to satisfy the customers' needs. All trainings are formalized and
centralizedand employee satisfaction is measured yearly. However, the authors’ state thatno data
is provided by the hotel concerning employee satisfaction as it isnewly implemented.
Like Hotel B, Hotel C also offers various training activitiesto its employees and this process
is called certified new-hire training (acomputer-based CD-ROM training). Each department is
provided with trainingmanuals. Training programs not only cover the aspects of technical
functions ofthe job but also on the loyalty aspect as well as overall operational information. All
types of trainings are provided for all supervisory and non-supervisory employees including part-
time employees too. A flexible reward system is implemented in Hotel C and the rewards are
based on each department achieving their targeted goals. Hotel C also conducts a yearly survey to
measure the level of its employees’ satisfaction with their jobs. The findingsfrom the survey are
used to develop a better action plans to solve the problemsidentified.
Process Management
The results under process management reveals that Hotel A ismore service-driven rather than
product driven while Hotel B and C are bothservice driven and product-driven. Both Hotel B and
C's design of products andservices is decided at the corporate level and their design of products
andservices ranges from guest rooms to food and beverages. Hotel A service-drivendecision is
based on does not use tools such customers and employees feedback.This feedback is used to be
used to improve the existing products, services andprocesses. Hotel A did not employ anyquality
framework in designing their new products, services and processes. Onthe other hand, Hotel B has
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a strong relationship with their vendors andstrengthens Hotel B's branding. The design of new
products and services isbased on employees, customers and suppliers feedback. Hotel B also
carries outyearly internal and external auditing. The auditing process covers all aspectof their
operation and management. Meanwhile, Hotel C methodically evaluatesall aspects of the design
before it produces and markets a product or service.Hotel C exploits its employees effectively, so
they can to manage the design processesefficiently. All employees will receive clear, standardized
work or processinstructions and employees need to engage in self-inspection. Hotel C
alsoregularly conducts preventive maintenance and maintenance inspections. LikeHotel B, Hotel
C also continuously carries out internal and external auditingin order to keep up with Hotel C
branding image. Hotel C also uses astandardized external auditing in maintaining the standard
required.
4.5 Action Plan for Improvement
Based on the case study, Hotel A does not have any formal TQMimplementation and they
lack focus in strategizing their strategic planning andstriking a balance on the other criteria. The
main concern of the topmanagement of Hotel A is to improve their financial status. Only after
theupgrading to upscale that Hotel A has started to implement TQM. Hotel A doesnot apply TQM
as a whole. However, they did not sacrifice on their guest andmarket focus (one of the TQM's
criteria) and this has helped Hotel A in theirbusiness result. Hotel A top leaders are also lack
commitment in viewingquality initiatives as a long-term investment. Thus, for further
improvementthey need to relook at their TQM implementation and adopt either the
MBNQAframework or other TQM framework. The top leader must be committed and have
avision that any implementation of TQM requires a long term planning which mightincur cost.
For Hotel B, they had implemented TQM before, but they were notsuccessful with the
implementation. Recently they have adopted the Six Sigma aspart of their TQM practice. Six
Sigma TQM allows companies to make improvementsin their bottom-line by designing and
monitoring everyday business activitiesin ways which minimizes all types of waste and non-value
adding activities andmaximizes customer satisfaction. On the other hand, Hotel C has proven that
asuccessful implementation of TQM can lead to a better business result. However,the case study
also reveals that the process management practices of the threehotels are not as complex as other
quality-conscious manufacturing or servicecompanies, where tools such as quality function
deployment is used extensivelyfor product or service design. Hence, more emphasis should be
placed on thisfactor.
Page 86 of 88
The MBNQA criteria have been proven to be suitable to beimplemented at the hotel
industries as how Ritz-Carlton Hotel has proven thatthey managed to receive the MBNQA twice.
MBNQA can be used as a guide by otherhotels to implement TQM successfully and achieve
excellence businessperformance. Changing customerrequirements is incorporated into production
and support processes, whichassists in prioritizing processes and each production and support
process isassigned an executive owner at the corporate office, who is responsible for
thedevelopment/improvement of these processes. Based on the success ofRitz-Carlton Hotels, the
MBNQA framework can indeed be implemented in the hotelindustry by putting the customers as
the focus of the hotel industry. To dothis, the leadership triad is implemented thoroughly with the
focus of qualitymanagement implementation.
The organizational profile sets the context for the way theorganization operates. The 3 key
elements in the organizational profile are theenvironment, relationships and strategic situation
serve as the benchmark forthe organizational performance management system. Criteria 1
(Leadership), 2(Strategic Planning) and 3 (Customer Focus) represent the leadership triad.These
categories are grouped together as it highlights the importance ofleadership focus on the 3 criteria.
Criteria 5 (Workforce Focus), 6 (OperationFocus) and 7 (Results) represent the results triad. The
workforce and itsoperations will lead to the performance results. All actions point toward
OrganizationalPerformance Results. The horizontal arrow in the center of the framework linksthe
leadership triad to the results triad, a linkage critical to organizationalsuccess. The arrow indicates
the central relationship between Criteria 1 andCriteria 7. The two-headed arrow indicates the
importance of feedback in aneffective performance management system (Ferreira, 2003).
Meanwhile, Criteria 4(Information Analysis or Measurement, Analysis and Knowledge
Management) is afoundation for the performance management system.
Page 87 of 88
Page 88 of 88

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Programme B.E. ECE& CIVIL

C702.2 Explain the TQM principles in a selected enterprise Level 2

Introduction - Need for quality - Evolution of quality - Definition of quality - Dimensions

Leadership - Deming Philosophy, Quality Council, Quality statements and Strategic

Introduction-Benefits of ISO Registration-ISO 9000 Series of Standards-Sector-Specific

Resources and Recommended Readings:

TOTAL = Made up of the whole

QUALITY = Degree of excellence a product or service provides

MANAGEMENT = Act, art or science /manner of handling,

TQM is a structured system for satisfying internal and external customers

Need for Quality

Dimensions of product and service quality

Product quality has two dimensions.

Like product quality, service quality has several dimensions.

 Responsiveness - Responsiveness refers to the reaction time of the service.

IMPORTANT POINTS TO BE NOTED WHILE QUALITY PLANNING :

BASIC CONCEPT OF TQM

A committed and involved management to provide ling term, top to bottom

An un – wavering focus on the customer both internally and externally.

Effective involvement and utilization of entire workforce.

TQM is everyone‘s responsibility in an organization. All workers in and organization must be

Continuous improvement of the business and production process.

Continuous improvement refers to constant refinement and improvement of products,

Treating suppliers as partner

Establishing performance measures for the process.

Performance measure is an integral part of the quality process. If an organization cannot

Gurus of TQM (Brief introduction)

THE DEMING PHILOSOPHY

1.Create and publish the aims and purposes of the organization

2.Learn the new philosophy

Customer satisfaction is the number one priority

Supplier must help to improve quality

Share the information relative to customer expectations

3.Understand the purpose of inspection

4.Stop awarding business based on price alone

5.Improve constantly and forever the system

The focus is preventing problems before they happen.

7.Teach and institute leadership

Improving supervision is management‘s responsibility Training in statistical methods

This climate will provide ideas for innovations and improvement.

9.Optimize the efforts of teams, groups, and staff areas.

10.Eliminate exhortations for the work force

11.a) Eliminate numerical quotas for the work force

Instead of quotas,management must learn and institute methods for improvements.

Quotas should be replaced with statistical method of process control.

b.) Eliminate management by objectives

12.Remove barriers that rob people of pride of workmanship

They are being blamed for system problems

Poor designs lead to the production of ―Junk‖ In adequate training is provided

In adequate or in-efficient equipment is provided for Performing the required work.

13.Encourage Education and self-improvement for everyone

What an organization need is people who are improving with education

14.Take action to accomplish the transformation

Management must be committed, involved and accessible if the organization is to succeed in

•The Trilogy consists of three sequential and logical groups of activities:

- discover customer needs and deficiencies and design adequate processes

- compare actual performance to goals and take action on the differences

- the attainment of unprecedented levels of performance

• Identify the customers