BBA in General Management
MGT450 TOTAL QUALITY
MANAGEMENT (TQM)
Dr. Abul PhD in Lean Manufacturing.
Bashar(LSSBB) MBA in DTM, RRU, BC, Canada
M. Eng. Sc. in IE, UM, Malaysia
Associate Professor B. Sc. in ME (BUET)
Department of 37 years experience
General -Home/abroad
Management -Teaching (31 yrs)/Industry (6 yrs)
IUB
CHAPTER 1
Total Quality
Management:
Introduction
What does the term quality
mean?
• Quality is the ability of a product or service
Quality to consistently meet or exceed customer
expectations.
Managem • Customer define quality in various ways
ent • Quality has multiple dimensions in the
mind of customer
Quality
Management: • Conformance to
Specifications
Customer- • Value
Driven • Fitness for Use
Definitions of
Quality • Support
• Psychological Impressions
When the expression “quality” is
used, we usually think in terms of an
Quantifying excellent product or service that
fulfills or exceeds our expectations.
Quality
Quality can be quantified as follows:
• Q=P/E
• where Q = quality
• P = performance
• E = expectation
Performance - main characteristics of the
product/service
Aesthetics - appearance, feel, smell, taste
Special features - extra characteristics
Conformance - how well product/service conforms
Dimension to customer’s expectations
s of Safety - Risk of injury
Reliability - consistency of performance
Quality Durability - useful life of the product/service
Perceived Quality - indirect evaluation of quality
(e.g. reputation)
Service after sale - handling of customer complaints
or checking on customer satisfaction
Consequences of Poor Quality
The • Loss of Business/Reputation
• Liability increased
Consequen • Productivity decreased
ces of Poor • Costs increased
Quality /
Benefits Benefits of Good Quality
• An enhanced Reputation for quality
of Good • The ability to command premium prices
Quality • An increased market share
• Greater customer loyalty
• Less customer complaints
• Higher productivity
• Lower Costs and
· The Costs of Poor Quality
· Prevention Costs
· Appraisal Costs
· Internal Failure Costs
·
· The Costs
External Failure Costs
of Poor • Prevention Costs
Quality • Prevention Costs are associated with preventing defects
before they happen. They include
• Redesigning the process to remove the causes of poor
quality.
• Redesigning the products to make it simple to produce
• Training employees for continuous improvement
• Working with suppliers to increase the quality of
purchased items
· Appraisal Costs
· Appraisal costs are associated with assessing the
level of quality attained by the operating system.
Examples are
Testing/Measuring/Inspection/Quality audits
· The Costs of materials/parts/products/services to assess
the conformance of quality standards
of Poor
Quality • Internal Failure Costs
• Internal failure costs result from defects that are
discovered during the production process of product
or service. Examples are
• Scrap, at full shop cost (yield losses)
• Rework, at full shop cost
• Scrap and rework , fault of vendor
• QC investigations (of failures)
• Repair and troubleshooting
· The Costs of Poor Quality
Costs of Detecting Defects
· External Failure Costs
Cost of detection and correction
• External failure costs arise when the
defect is discovered by the customer
after receiving the product or service.
• Complaints and loss of customer
goodwill
• Warranty costs (a written guarantee of
replacement and repair)
• Field maintenance and service cost
• Returned material processing and repair
cost
• Replacement inventories
• Strained distributor relations
Process Final testing Customer
Where defect is detected
• An enhancement to the traditional way of doing business.
• A philosophy that involves everyone in an
organization in a continual effort to improve quality
Total and achieve customer satisfaction.
Quality • Comprises three words:
1. Total – Made up of the whole
Managem 2. Quality – Degree of excellence a product or service
provides
ent (TQM) 3. Management - Art and science of achieving
organizational goals through planning, leading,
organizing and controlling the resources
• It is the application of quantitative methods and human
resources to improve all the processes within an
organization and exceed customer needs now and in the
future.
TQM
Wheel
Customer
satisfaction
Continual improvement
Competitive benchmarking
Employee involvement
Elements of Knowledge of problem-solving tools
TQM Supplier quality
Product design
Process design
· Cultural Change
Employee · Team Approach
Involveme · Individual
Development/Empowerm
nt ent
· Awards and Incentives
Continuous Improvement
• Continuous Improvement is the Philosophy of continually
seeking ways to improve operations or production processes.
• Kaizen: Japanese word for continuous
improvement. Example CI
• Reducing the length of time to process loans in a bank
• Reduce the scrap generated in a milling machine
• Reduce the number of injuries in the factory
Continuous Improvement
The Deming (PDCA) Cycle
A P
(Act) (Plan)
e n d i ng
r-
Neve m e nt
(Check) (Do) ov e
i m pr
C D
Quality
• Deming cycle is a tool for • Do:
continuous improvement, • Implement the change
and it is a tool for an ongoing on a small scale.
effort to improve products, • Monitor the solution
Deming services or processes. •• Check:
• Use data and facts to
Cycle analyze the results of
• Plan: the change and
determine whether it
• Define the problem and made a difference.
establish an
•• Act:
improvement goal
• If the change was
• Collect data successful, implement
• Analyze the problem it on a wider scale and
continuously assess
• Generate potential your results.
solutions after assessing • If the change did not
benefits and costs work, begin the cycle
• Choose a solution again.
Sometimes, firms need to change design to
remain competitive.
New design and redesign of the product or
service or process should be tested carefully.
Product/ Design or redesign should focus on
Service performance and simplicity.
Design: Change in design often require changes in
methods, materials and specification which
increase the risk of making mistakes.
Stable product and service design can help
to reduce internal quality problems,
Reliability: another dimension of
quality
Product reliability
rs = (r1)(r2) . . . (rn)
where
rs = reliability of the complete product
n= number of subsystems
rn = reliability of the subsystem or
component n
rs = (0.99)(0.95)(0.90) = 0.85
• Benchmarking is the process of
measuring an organization’s
performance against that best in the
same or another industry.
• Types of benchmarking
Benchmark • Internal: Involves an organizational
unit with superior performance as
ing the benchmark for other units
• Competitive: Based on
comparisons with a direct industry
competitors
• Functional: Compares areas such
as administration, customer service,
sales and marketing with those of
outstanding firms in any industry
• Flowcharts
• Check sheets
• Histograms
• Pareto Charts
• Scatter diagrams
Basic • Control charts
Quality • Cause-and-effect diagrams
Tools • Run charts
•Cause-and-Effect Diagrams is also called
fishbone diagram
• It relates the key quality problem to its
Cause- potential causes
and-Effect •First developed by Kaoru Ishikawa
•The diagram helps management trace
Diagrams customer complaints directly to the
operations involved
Checker Board Airlines
Equipment Personnel
Aircraft late to gate Passenger processing at gate
Other Mechanical failures Late cabin cleaners
Weather Unavailable cockpit crew
Air traffic delays Late cabin crew
Delayed
flight
Late baggage to aircraft departures
Poor announcement of departures
Late fuel
Weight/balance sheet late
Late food service
Delayed check-in procedure
Contractor not provided
updated schedule Waiting for late passengers
Materials Procedures
Tools for Improving Quality
Step 1—Checklist
Wellington Step 2—Pareto chart
Fiber Board Step 3—Cause-and-effect
diagram
Co. Step 4—Bar chart
Wellington Fiber Board Co.
Checklists
Headliner Defects
Defect type Tally Total
A. Tears in fabric //// 4
B. Discolored fabric /// 3
C. Broken fiber board //// //// //// ////
//// //// //// / 36
D. Ragged edges //// // 7
Total 50
Figure 6.7
Wellington Fiber Board Co.
Pareto Chart
50 100
Cumulative percentage
40 C 80
Number of defects
30 60
20 40
10 D 20
A B
0 0
Defect type
Figure 6.7
Wellington Fiber Board Co.
Cause-and-Effect Diagram
People
Materials
Training
Out of specification Absenteeism
Not available Communication
Broken
fiber board
Humidity Machine maintenance
Schedule changes Machine speed
Wrong setup
Other
Process
Figure 6.7
Wellington Fiber Board Co.
Bar Chart
Number of broken fiber boards
20
15
10
First Second Third
0 Shift
Figure 6.7
Vanishing Cream
40 100
90%
Vera Johnson and Merris Williams manufacture 36 100% 90
Cumulative percentage of defects
vanishing cream. The packaging process has 78%
four stages. (1) mix (ii) fill (iii) cap and (iv) label. 32 80
They have had the reported process failures 28 70
Frequency of defects
analyzed, which shows the following.
24 60
Process frequency 48%
20 50
Lumps of unmixed product 7
16 40
Over or underfilled jars 18
12 30
Jar lids did not seal 6
8 20
Label missing 29
4 10
0 0
Draw a Pareto chart to identify the vital failures Label Fill Mix
Seal