Quality Quality means conforming to specifications and standards.

. Quality means productivity, competitive costs, timely and delivery and total customer satisfaction. Fitness for use is Quality. Product Quality is decided by the customers needs, delivery, conforming efficient to specifications, assured and performance and safety, proper packaging, timely technical service incorporating customers feedback. In service quality speed of response, dependability, control and facilities are important factors. Quality is what the customers say it is. The fundamental factors, which affect the product quality, are: a) Markets c) Men b) Materials d) Machines

e) Money g) Management Total Quality

f) Methods h) Miscellaneous

It means all people of the organization are committed to product/service quality by doing thing right, first time, every time by employing organizational resources to provide value to customers. Total Quality is a moneymaker. Total quality puts pride, challenge, learning and craftsmanship back into the job. At present starting point is customer needs. These customer needs are converted in to product / service features. Process produces the product/service as per customers requirements. Inspection of the product is done at different stages. Feedback from customers is obtained and information is given to product designer, product designer has to look quality of a product during its complete life
2

span.

Feedback

from

inspection is given to manufacturing planning and to product designer. Every one in any organization is producing an output product/service/information. Thus every one in the organization has a customer. Failure to meet the needs and explanations of internal customers can result in a poor quality product. Four essentials are: Reduced Defects Improve Productivity Improve customer satisfaction Delighted Customer TOTAL QUALITY MANAGENENT The Total Quality Management (TQM ) is an enhancement to the traditional way of doing business. If we analyze it in detail we see: Total = Made up of the whole.

Quality = Degree of Excellence a product or service provides Management = Act, art or manner of handling, controlling, directing, etc. Therefore, TQM in short is the art of managing the whole to achieve excellence. When the work Quality comes into our mind, we usually think in terms of an excellent product or service that fulfills or exceeds our expectations. When a product surpasses our expectations we consider it as the quality of that product. Quality may mathematically be expressed as: Q=P/E Where: Q = quality, Expectations If Q comes out greater than 1.0 then the Quality of that product or service is termed as good.
4

P = Performance,

Quality has nine different dimensions on which basis it is usually assessed. They are as under: 1. Performance: Primary product characteristics. 2. Features: Secondary Characteristics or added features. 3. Conformance: standards. 4. Reliability: Consistency of performance over time. 5. Durability: Useful Life. 6. Service: Resolution of problems and complaints, ease of repair. 7. Response: Human to human response. 8. Aesthetics: exterior finish. 9. Reputation: Past Performance, such as being ranked first. Sensory characteristics such as Meeting Specifications or

HISTORY OF QUALITY The history of quality is as old as the human civilization itself is. Before industrial revolution manufacture was essentially conducted by the cottage industry approach and relied heavily on craftsmen. The craftsman were trained enough to attain the quality and standard of work. With the advent of the industrial revolution manufacture broken into small jobs. The craftsman became inspectors and standards emerged. Unskilled workforce performing limited skill operations. Two world wars demanded a further rapid expansion in manufacturing. Industries rely on the use of inspectors to ensure the quality of product leaving the factory quality control. Quality is the responsibility of everyone from R & D stage through project definition, design, manufacturing and customer support.

 A statistical approach to assist quality emerged in 1924. The Deming prize was introduced first in 1951 to statistical quality control. In 1952 cause and effect diagram introduced by K. Ishikawa In 1960 quality assurance emerged In year 1962 zero defect introduced Feigenbaum coined the term TQC in 1983, which became TQM afterwards. In year 1987 introduction of quality standards based on ISO 9000.

Principles of TQM Following are the some important principles of TQM: 1. Delight the Customer Delight means bring best at what really matters most to the customers 2. Management by fact Decisions are based upon fact
7

3. People based Management Everybody must be involved. The more people feel involved, the greater will be their commitment to customer satisfaction. Performance appraisal and reward system is must. Do it together. Motivated people. Empowerment. 4. Continuous Improvement TQM is a management process that recognizes that however much we may improve, our competitors will continue to improve and our customers will expect more from us. Quality monitoring is necessary. 5. TQM ends and begins with education and training. 6. There is need for strategic quality planning. 7. TQM is supported by quality system measure and control. 8. TQM cannot afford week links/processes.

Model for Quality Excellence: World-class quality through continuous improvement is possible through TQM i.e. Total employees involvement Total waste elimination Company wide/total quality control
8

 ISO 9000 is just a milestone in TQM journey Information technology strategy

Quality Circles and Quality Improvement Teams A quality circle is typically an informal group of people that consists of operators, supervisors, managers and so on, which get together to improve ways to make the product or deliver the service. The concept behind quality circles is that, in most cases, the persons who are closest to an operation are in a better position to contribute ideas that will lead to an improvement in it. Thus improvement-seeking ideas do not come only from managers but also from all other personnel who are involved in the particular activity. A quality circle tries to overcome barriers that may exist within the
9

prevailing organizational structure so as to foster an open exchange of ideas. A quality circle can be an effective productivity improvement tool because it generates new ideas and implements participative them. style Key of to its success The is its management. group

members are actively involved in the decision making process and therefore develop a positive attitude toward creating a better product or service. They identify with the idea of improvement and no longer feel that they are outsiders or that only management may dictate how things are done. Quality circles have been used in Japan since the early 1960s. They have led to numerous improvements in product quality. Toyota for example has used this approach to identify critical problems and determine remedial measures. Brainstorming sessions are usually conducted under the guidance of a group leader. In the United States quality circles
10

were implemented in the early 1970s. Lately the use of this tool has not been increasing and is nowhere close to the levels seen in Japan. One possible reason for this difference is the lack of statistical training of U.S workers. Another reason is the reluctance of U.S managers to share power with employees. Identification of possible problems and remedial actions requires a statistical background. For almost two decades Japan has conducted training programs in statistical methods for all of their personnel. U.S companies have not done this and they are only now realizing the importance of understanding statistical concepts. The improvement team is another means of

identifying feasible solutions to quality problems. The quality improvement team may consist of personnel from design and development, engineering, manufacturing, marketing and servicing. A key advantage of such a team is that it promotes cross11

disciplinary flow of information in real time as it solves the problem. RESPONSIBILITY FOR QUALITY During the industrial revolution, the concept of specialized labour was introduced. Prior to this time, the entire product was made by an individual, who was therefore solely responsible for its quality. Mass production methods were introduced during the industrial revolution, and jobs became more specialized as products became more complicated. A supervisor was responsible for quality control, with the focus primarily on inspection. Over the years, the emphasis changed from defect detection to defect prevention. Thus no longer is one person or one department is responsible for quality, it is every ones responsibility. management organization. The and commitment spreads starts with top the throughout

12

Following

are

some

specific

responsibilities

associated with various departments or units within an organization. 1. Marketing & Product Planning The marketing and product-planning department determines the needs and requirements of the customer. Additionally they supply information on the price that the customer is willing to pay. This department obtains information through such means as market surveys conducted via questionnaires, feedback from sales representatives and customer complaints. 2. Product Design & Development The responsibility of the product design and development unit is to develop product specifications, determine the raw materials or components to be used and decide on the performance characteristics of the product. It uses the information on customer needs found by the marketing department as input.
13

3. Manufacturing Engineering The manufacturing engineering department is responsible for determining the details of the manufacturing process. It designs the equipment, work methods and procedures, inspection tools and sequence of operations. It conducts analysis to determine whether existing manufacturing facilities and resources are capable of producing the product with the quality specified in the design phase 4. Purchasing The purchasing department obtains the raw materials and components for the product. It selects vendors whose products meet certain incoming quality requirements. If there is a lot of variation in the incoming quality of raw materials an undesirable variability will occur in the outgoing product. Vender quality control is under the jurisdiction of this department. In selecting vendors, quality and cost are important factors.
14

Vender quality control involves developing a long term relationship with a few high quality vendors. This practice has been extensively followed in Japan and has several advantages for both parties. For instance, the company does not have to go through the vendor selection process as frequently, this is good because evaluating vendors can be time consuming and costly. Furthermore, the good relationship enables the company to depend on the vendor when demand for the companys product is uncertain. In peak demand periods, the company can still obtain all of its materials from the same vendor without searching for addition ones. Achieving companys goal is easier with one source rather than with many. 5. Manufacturing The manufacturing unit is responsible for producing a quality product. It must control the operations, process parameters and operator performance to

15

achieve the desired level of quality. Control charts are often used for such purposes. 6. Inspection & Test The inspection and test unit is responsible for appraising the quality of incoming raw materials and components as well as the quality of the manufactured product or service. It also specifies the type of inspection devices to use and the producers to follow to measure the quality characteristics of interest. 7. Packing & Shipping The packing and shipping unit is responsible to check how the product is packaged and transported to the customer. This function serves to protect the quality of the product during the process of storage and shipment. For instance, in the case of products that are brittle (such as glass mirrors) proper packing methods must be used so that the items are not

16

damaged during transportation and delivering to the customers. 8. Customer Service The customer service department is responsible for installation, maintenance and repair of products. Its purpose is to help the customer get the most out of the product and to assist the customer when required. The promptness, politeness and accuracy of customer service is sometimes all that stands between a satisfied customer and a dissatisfied one.
CUSTOMER Customer Service Marketing & Product Planning

Packing & Shipping

Product Design & Development

Inspection & Testing

Manufacturing Engineering

Manufacturing
17

Purchasing

Management For Quality Management of the total quality system is achieved through the functions of planning, organizing, staffing, directing and controlling. S. Management Product Phase Action to be No. Functions taken 1. Plan Proposal Phase Develop Quality Policy Plan for Quality Set up Guidelines for system administration Consider product liability/user safety 2. Organize Design/Planning Develop an Phase organization
18

3.

Staff

4.

Direct

5.

Control

structure Design Assurance Design Change Control Develop production quality Planning Pre Production Select Phase Employees Train Employees Motivate Employees Production Monitor Phase purchased materials quality Monitor process quality control Direct final inspection Direct handling/inspecti on Production & Obtain quality Post Production information Phase Get data on field performance Take corrective action Conduct
19

statistical quality control Manage quality costs 1. Planning For Quality Planning is a necessary requirement for a successful quality program. In the planning process, the company considers its quality mission and objectives its key qualities as prescribed by the consumer, its market commitments, its available human resources and production facilities and its financial constraints. Based on the companys strategy, the different areas of the organization develop goals to support the set mission. The goals and objectives of middle management are converted to operational plans that will be implemented by all levels of management. Quality planning may be categorized as administrative plans and product oriented plans. Administrative plans deals with the operational and business aspects of the company. The product oriented plan, on the
20

other hand deals with marketing, product and process design, and production engineering. 2. Organizing for Quality An organizational structure is created to establish lines of authority and responsibility, to improve communication and to improve productivity. The major activities involved in organizing for quality consist of defining quality related activities and the inter relationships between them, assigning responsibility for each of the tasks and subdividing tasks down to the worker level. 3. Staffing For Quality The success of a company wide quality program depends on all personnel being committed to the quality philosophy. Everyone must develop a sense of ownership in the production of a quality item. Placing personnel with the appropriate training in statistical quality control techniques in key positions facilitates the implementation of quality.
21

To ensure the achievement of a certain level of knowledge regarding quality, certification programs are administered by the American Society for Quality Control. Examples of such certification programs are those for the Certified Quality Engineer (CQE) and the certified Reliability Engineer (CRE). An organization should staff its managerial positions with candidates certified in the appropriate quality area. Additionally, a company can give them incentives to become certified either through salary increase, promotions, or acknowledgements through awards. 4. Directing For Quality Once quality has been incorporated into the design of the product, the production phase takes measures to ensure that the produced item conforms to the design specifications. The quality of purchased raw materials and compounds is important in this phase, so vendors must be monitored for quality control.

22

5. Controlling For Quality The control aspects occur during the production and postproduction phases. The objective is to determine out of control process conditions and product nonconformance as early in the production phase as possible. To achieve these procedures must be established to obtain relevant process information on a timely basis. Possible rectifying actions must be identified in case the process is found to be out of control. Such rectifying actions must be taken when appropriate. Total Quality Management Philosophies Several people have made significant contributions in the field of quality control. W. Edwards Deming, Philip B. Crossby and Joseph M. Juran are considered pioneers in the field of quality control. W. Edwards Deming and his Contribution W. Edwards Deming is credited with the impressive turnaround in Japanese industry after World War II. In
23

1950,

the

Union

of

Japanese

Scientists

and

Engineers (JUSE) invited Deming to address their leading industrialists. Japan had a reputation for poor quality at that time. Their domestic economy was shattered and JUSE was looking at ways to jump-start the Japanese economy. They took Demings advice to heart and set about totally revamping their industrial culture. Through their total philosophical commitment to Demings methods, Japanese industry moved to the forefront. What we see today are the results of using Demings philosophy over the last four decades. Improvement in quality did not happen overnight but Deming knew with certainty that it would happen. The Japanese continue to Demings ideas and they constantly seek ways to improve their processes and products. In 1951, JUSE instituted the coveted Deming Award, an annual award given to the individual or firm contributing most to the advancement of industrial
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quality. Recipients of this award include companies like Toyota, Nissan, Nippon Steel and Hitachi. The first U.S Company to win the Deming Award was Texas Instruments in 1985. Philosophy Demings Philosophy emphasizes the role of management. Of the problems that industry faces, Deming said that 85% could be solved only by management. In Demings world, workers responsibility lies in communicating to management the information they possess regarding the system. The Demings ideal management style is holistic: the organization is viewed as an integrated entity. The idea is to plan for the long run and provide a course of action for the short run. Deming believed in the adoption of a total quality program and emphasized the never-ending nature of quality control in the quality improvement process. Such a program achieved the desired goals of
25

improved

quality,

customer

satisfaction,

higher

productivity and lower total costs in the long run. Deming advocated certain key components that are essential for the The journey following toward four continuous components improvement.

comprise the basis for what Deming called the system of Profound Knowledge. a) Knowledge of the system and the Theory of Optimization. Management needs to understand that optimization of the total system is the objective. The total system consists of all constituents ---customers, employees, suppliers, shareholders, the community and the environment.

b) Knowledge of the Theory of Variation All processes exhibit variability, the causes of which are of two types: Special causes and common
26

causes. Special causes of variation of variation are external to the system. It is the responsibility of operating personnel and engineering to eliminate such cases. Common causes, on the other hand are due to the inherent design and structure of the system. They define the system. It is the responsibility of management to reduce the common cause. A system that exists in an environment of common causes only is said to be stable and in control. Once a system is considered to be in control its capability can be assessed and predictions on its output made. c) Exposure to the Theory of Knowledge Information by itself is not knowledge. Knowledge is evidenced by the ability to make predictions. Such predictions are based on an underlying theory. The underlying theory is supported or invalidated when the observed outcome is compared to the predicted value. d) Knowledge of Psychology
27

Managing

people

will

require

knowledge

of

psychology because it helps us understand the behavior and interactions of people, and also the interactions of people with their environment. Also required is knowledge of what motivates people. People are motivated by a combination of intrinsic and extrinsic factors. Job satisfaction and the motivation to excel are intrinsic. Reward and recognition are extrinsic. Management needs to create the right mix of these factors to motivate employees. Philip B. Crossbys Philosophy Philip B. Crossbys Philosophy has a particularly wide-ranging understanding of the various operations in industry because he started as a line inspector and worked his way up. Such first hand experience has provided him with a keen awareness of what quality is, what the obstacles to quality are and what can be done to overcome them.

28

In order to understand the meaning to understand the meaning of quality, Crossby (1979) has identified four absolutes of quality management. Definition of Quality: Quality means conformance to requirements. System for achievement of Quality: The rational approach is prevention of defects. Performance Standard: The only performance standard is zero defects. Measurement: The performance measurement is the cost of un quality such as scrap, rework, services, inventory, inspection and tests. Step Plan For Quality Improvement Crossby has a 14-step plan that is given below: 1. Management Commitment For quality improvement to be take place commitment must start at the top. The emphasis on defect prevention has to be communicated and a quality policy that states the
29

individual

performance

requirements

needed

to

match

customer

requirements must be developed. 2. Quality Improvement Team Representatives form each department or division serves as spokespersons for each group they represent. They are responsible for ensuring that suggested operations are brought to action. This team brings all the necessary tools together. 3. Quality Measurement Measurement is necessary to determine the status of quality for each activity. It identifies the areas where corrective action is needed and where quality improvement efforts should be directed. The results of measurement, which are placed in highly visible charts, establish the foundation for the quality improvement program. 4. Cost for Quality Evaluation

30

The cost of quality indicates where corrective action and quality improvement will result in savings for the company. A study to determine these costs should be conducted through the comptrollers office, with the categories that comprise quality costs precisely defined. 5. Quality Awareness The results of the cost non-quality should be shared with all employees, including service and administrative people. Getting everybody involved with quality facilitates a quality attitude. 6. Corrective Action Open communication and active discussion of problems creates feasible solutions. Furthermore, such discussion also exposes other problems not identified previously and thus determines procedures to eliminate them. Attempts to restore problems should be made as they arise. For those problems

31

without immediately identifiable remedies, discussion is postponed to subsequent meetings. 7. Ad hoc Committee for the zero defects

programs The concept of zero defects must be communicated clearly to all employees, everyone must understand that the achievement of such a goal is the companys objective. This committee gives credibility to the quality program and demonstrates the commitment of top management. 8. Supervision Training All levels of management must be made aware of the steps of the quality improvement program. Also they must be trained so they can explain the program to the employees. This ensures the propagation of the quality concepts from the chief executive officers to the hourly workers. 9. Zero Defects (ZD) Day
32

The philosophy of zero defects should be established company wide and should originate on one day. This ensures a uniform understanding of the concept for everyone. Management has the responsibility of explaining the program to the employees.

10. Goal Setting Employees in conjunction with their supervisors should set specific measurable goals. These could be 30, 60, or 90-day goals. This process creates a favorable attitude for people to ultimately achieve their own goals. 11. Error Cause Removal The employees are asked to identify reasons that prevent them from meeting the zero defects goal. It is the task of the appropriate functional group to come up with procedures for removing these problems. Reporting problems should be done quickly.

33

12. Recognition Award programs should be based on recognition rather than money and should identify those employees who have either met or exceeded their goals or have excelled in other ways. Such programs will encourage all participation of every one in the quality program. 13. Quality Councils Chairpersons, team leaders and professionals associated with the quality program should meet on a regular basis to keep everyone up to date on progress. These meetings create new ideas for further improvement of Quality. 14. Do it Over Again The whole process of quality improvement is continuous. It repeats again and again as the quality philosophy becomes ingrained.

34

TQM MODELS There are important theories, which are called models to improve the overall quality. They are as under: 1. JURAN MODEL This model emphasis on the following considerations: 1. Quality Planning 2. Quality control Chronic defects occur when process is incapable of consistently producing satisfactory output. Process needs to be improved. Sporadic defects occur when the process is capable but has gone out of control. This is time to repair it or put it back in place.

3. Quality Improvement a) Quality Planning involves analysis of customer needs, product and process in preparation for implementing quality control.
35

b) Quality control c) Quality improvement approach identifies sources of unacceptable variation and eliminating sources of poor quality makes adjustments in product design, processes, procedures etc. there, such that the costs of poor quality can be greatly reduced. The new zone of quality control translate to improve customer satisfaction, increased sales, lower unit material labour costs, increase overall process capacity, a more motivated and secure work force with greater self esteem etc. As the improvement process progresses, lessons learned provide feedback to improve the planning process. 2. THE QUALITY PLANNING ROAD MAP Delighted Customer Empowered Employee Higher Revenues Lower Costs Process-Quality Planning

36

Quality Control Quality Improvement

Infrastructure system Customer partnership

Quality supplier

Total organisation involvement Measurement & Information. Education and Training Strategic Quality Planning Execution Leadership Customer focus

3. THE DEMING CHAIN REACTION

37

a) Improve quality decrease c) Productivity improves the market e) Stay in the business jobs and more jobs 4. THE CROSBY PROGRAM a) Management Commitment improvement team c) Quality Measurement Quality Evaluation f) Quality Awareness Action

b) d) f)

Costs Capture Provides

b) d) g)

Quality Cost of

Corrective

h) Establish an ad hoc committee for the zero defects programme i) Supervisor training year/month/weak k) Goal setting m) Recognition o) Do it over again
38

j) Zero defect day in a l) Error cause removal n) Quality councils

Quality Assurance Quality assurance means excellent working of entire system i.e. policies, procedures and guidelines in order to achieve and maintain quality in the manufacturing Engineering, Management. The purpose of quality engineering is to incorporate quality into the design of products and processes and to predict potential quality problems prior to delivery of the product. and Quality services Control system. and Quality Quality assurance consists of three basic functions: Quality

39

The purpose of quality control is to make a series of planned measurements in order to determine the meeting of quality standards. In case they are not met corrective action and further preventive action must be taken to achieve and maintain quality. The quality management involves the planning, organization, directions and control of all quality assurance activities. Quality in Manufacturing Systems Quality is an important component of all functions in manufacturing systems, for instance, effective market research is necessary to determine customer needs and identify functional requirements for product designers. Product designers must take care to neither over engineering (inefficient use of resources) nor under engineering products. Purchasing must ensure that supplies meet quality requirements. Tool engineering and maintenance are responsible for ensuring that tools, gadgets and equipment are
40

properly maintained. Industrial engineering must select the appropriate technology that is capable to meet design requirements. Quality in Services Systems A service is a social act, which takes place in direct contact between the customer and representatives of the company. Many service organizations such as airlines, banks, hotels and courier companies have well developed quality assurance systems. Service organizations have special requirements that manufacturing systems cannot fulfill. Service organizations must look beyond product orientation and pay significant attention to customer transactions and employee behavior. In services the distinguishing features that determine quality differ from manufacturing. The most important dimensions of service quality include:
41

 Time: How long must a customer wait? Completeness: Are all items in the order included? Courtesy: Do employees greet each customer cheerfully? Consistency: Are services delivered in the same fashion for every customer? Accessibility and convenience: Is the service easy to obtain? Accuracy: Is the service performed right the first time? Responsiveness: Are the service personnel react quickly and resolve unexpected problems? The service providing companies should consider the following points: Quality Characteristics Quality Interaction Image Quality Management
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Advantages of TQM i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii. The important advantages of TQM are summarised below: Improved competitiveness Quality is profitable Better profitability better returns. Reduction in operating cost Increased sales and market share Enhanced customer satisfaction, Number of customers increased Improved cost effectiveness Reduced cost, unit cost reduction Reduction in rejection, scrap and wastage reworking Better control on processes Successful new product launch Speedy new product introduction, more new models Reengineered process Improved quality, continuous improvement is an important thing of TQM
43

xiii. xiv. xv. xvi. xvii. xviii. xix.

Improved productivity Better relations, employees Job satisfaction and employees participation fuel saving Cleanliness, less space is required, better house keeping Improved system Standardization of work routine, quality process Respect humanity

QUALITY AWARDS In order to highlight the importance of quality an award system was introduced. Some of the important quality awards are discussed as under: Malcolm Baldrige Award In 1987 Malcolm Baldrige Award was introduced in America. The companies who succeed in attaining total quality management were given this award. This

44

award was named after secretary of commerce Malcolm Baldrige. The purposes of the award were: 1. Help companies to improve quality and productivity with the objective to obtain increased profits. 2. Recognize the achievements of these companies that improve the quality of their goods and services. 3. Establish guidelines and criteria that can be used by enterprises in evaluating their own quality improvement efforts. 4. Provide specific guidance for enterprises that wish to learn how to manage for high quality. Award Criteria The award criterion is based on an Examination. The Examination addresses key requirements to achieve quality excellence as well as the important interrelationships among these key requirements. The four basic elements are:

45

1. Senior Executive Leadership drives the system, creating the values, goals and systems and guides for quality and performance. 2. The system is comprised of a set of well-defined and well-designed processes for meeting the companys quality and performance. 3. Measures of progress provide a result-oriented basis for channeling actions to delivering everimproving customer value and company performance. 4. The basic goal of the quality process is the delivery of ever increasing value to customers. For the award the companies must excellently perform in seven key areas they are described below: 1. Leadership The leadership examines executives personal leadership and involvement in creating and sustaining a customer focus and clear visible quality values.

46

2. Information and Analysis This examines the scope, validity, use and management of data and information to drive quality excellence and improve competitive performance. 3. Strategic Quality Planning This examines the companys planning process for achieving or retaining the quality leadership. This also examines the companys short and long term plans. 4. Human Resources Development & Management This examines the key elements of how the work force is enabled to develop its full potential to pursue the companys quality and operational performance objectives. This also examines companys efforts to build and maintain an environment for quality excellence. 5. Management of Process Quality

47

This examines the system process the company uses to pursue higher quality and company performance. This includes key elements of process management, research development and design for all work units. 6. Quality and Operational Results This examines the companys quality levels and improvement trends, operational performance and suppliers quality. This also examines the current quality and operational performance of competitors. 7. Customer Focus & Satisfaction This examines the companys relationships with customers and its knowledge of customer requirements.

DEMING PRIZE The highest prize for quality improvement in Japan is called Deming Prize. Since 1951 the Japanese Union of Scientists and Engineers has sponsored the
48

Deming Prize. This prize is awarded to individuals and companies who meet the criteria in pursuance of quality. The selection criterion is based on a checklist of ten major categories that are given below. 1. Policy Management, Quality, Quality Control, Policy making method, 2. Organization and Operation Authority and responsibility, Cooperation among divisions, Use of staff, Quality control audits. 3. Education and Training Education & training of employee, Plans and accomplishments, suggestion system for improvements and its working for quality. 4. Collecting & Using Information

49

Collection of information, passing information to relevant divisions, speed of transmitted information, statistical analysis 5. Analysis Selection of priority problems, Quality analysis, analysis of results

6. Standardization System of standards, setting & revising of standards, Use of statistical methods 7. Control System for control of quality, cost and production volumes, actual control activities, state of control 8. Quality Assurance
50

New product development methods, safety and product liability, measurement & inspection, Quality assurance system, Quality assessment & audit 9. Effect Measuring effects, quality service, delivery schedule, cost, safety 10. Planning for Future Plans for correcting defects, Plans for promoting quality control, long term plans

THE DEMING MANAGEMENT PHILOSOPHY

51

The Demings management philosophy is basically a philosophy of management and leadership. His ideas referred as A System of Profound Knowledge is simple and is also called Principles of Demings Philosophy. Profound Knowledge Profound knowledge consists of four parts and they are interrelated with each other. 1. Appreciation for a System: A system is a series of activities within an organization that work together for the aim of the organization. The components of any system must work together for the system to be effective. With cooperation all the people that work within a system can contribute to improvement. To manage any system managers must understand the interrelationships among all components of the system.

52

Management must have some aim or purpose for which the system is devised to work. Deming believes that the aim of any system is for everybody suppliers, employees, customers, community and the environment. Managements job is to optimise the system so that everybody wins. Deming states that it is poor management, for example to purchase inexpensive materials of such inferior quality that they will cause excessive costs. Likewise a focus only on manufacturing cost might result in products that do not meet designers specifications and customers needs.

2. Theory of Variation: The second part of profound knowledge is theory of variation. Variation in any process should be reduced. With less variation both producer and customer are benefited. The producer is benefited by having less need for inspection, less
53

scrap and rework and higher productivity. The consumer is benefited from lower cost and the assurance that all products are similar. A production process contains many sources of variation. Different lots of material will vary in strength, thickness, etc. For example, cutting tools will have inherent variation in strength and composition. During manufacturing tools will experience wear, machine vibration will cause changes in setting and electrical fluctuations will cause variations in power. 3. Theory of Knowledge: The third part of profound knowledge is the theory of knowledge. Theory of knowledge is a branch of philosophy that is concerned with the nature and scope of knowledge. Deming emphasis that there is no knowledge without theory and that experience alone does not establish a theory.

54

Theory leads to questioning and can be tested and validated. Theory establishes a cause and effect relationship that can be used for prediction. Managers have a responsibility to understand theory before blindly applying a technique. 4. Psychology: Psychology helps us to understand people, interactions between people and circumstances, interactions between leaders and employees and the system of management. A leader should keep him aware about differences and individuals abilities to optimise the system. Most managers operate under the assumption that all people are alike.

55

CUSTOMER SATISFACTION The first step of a certain manufacturing and service providing organization should be identification of customer needs and expectations. a) Values b) Brand Image c) Performance Customer satisfaction means keeping customer A majority of todays customers look for goods services in terms of:

requirement in mind. a) Right quality b) Right Quantity c) At right time d) At right cost When the organization is customer oriented, it attempts in going to almost any length to satisfy the
56

customers. The organization give them the feeling of getting full value for their money, delivering the products / services as promised. A Japanese professor N. Kano suggested that three classes of customer needs exist: a) Dissatisfiers, which are those needs that are expected in a product or service. b) Satisfiers, which are, need that customers say they want. c) Exciters/delighters, which are new or innovative features that customers do not expect. Satisfiers are determined through market research. Over time exciters/ delighters become satisfiers as customers become used to them and eventually satisfiers become dissatisfiers. Customer Driven Quality Cycle The customer driven quality cycle begins with actual customer needs and expectations (expected quality)
57

and ends with what the customer sees and believes the quality of the product to be (perceived quality). Expected quality is what the customer expects will be received from the product in reply to customers needs. Perceived quality is the customers measure of satisfaction in the product or the feel in its quality. Between expectations and perceptions the product is in the hands of the producer so he is in a better position to identify and incorporate the needs. Perceived Quality = Actual Quality -- Expected Quality Research Strategies Market research plays an important role in determining what features are important to customers. Market research involves the direct survey of buyers as to their needs, satisfaction and reasons for purchasing products. Information on customer needs comes from other sources besides market research. Sales persons have first
58

hand

knowledge

of

customers needs, desires, and comments about products. Technicians try to understand the reasons for products failure and listen to comments of customers.

Quality Function Deployment Quality Function Deployment (QFD) is a methodology to ensure that customers requirements are met throughout the design process. Quality Function Deployment is a philosophy and a set of planning and communication tools that focuses on customer requirements in coordinating the design, manufacturing and marketing of goods. A profit depends on quality and customer satisfaction. Reputations are built through satisfying customers. The customer will have a need, which the organization is trying to fulfill. Customer Complaints
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A complaint is any response or thought of a customer about any product or service that does not meet their expectations. Complaints come through letters, survey results, telephone calls, fax messages,

comments to sales and service personnel. Each quality complain possesses different problems: a) Satisfying the complaint. Restoration of service claim, adjustment, restoration of good will. b) Preventing a reoccurrence of complaints. c) Identifying the few vital serious complaints. d) In depth analysis if discover the basic causes of the complaint.

Quality Measurement by Customers Appearance Esthetic Design

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 Ruggedness Dependability Long Life Customer Attitude Quality of Shipment Product Installation Product Operation Service Maintainability Who can be a customer? We can know who can be a customer by: a) Flow diagram method b) Activity log method

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METHODS OF CONTINUOUS IMPROVEMENT In western countries much attention is given to maintaining technical and operating functions. The focus in Japan is given on improving those functions. Continuous improvement had always remained a foundation step for the quality improvement. Many opportunities These are: 1. Improving the organization by improving the human resources 2. Improving product design with features that meets customers needs 3. Improving manufacturing systems by reducing defects for continuous improvement exist.

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1. Improving Human Resources Human resources management recognizes the value of employees in meeting the customer needs and on sharing the information, responsibility and rewards. In a TQM environment significant changes occur in recruitment and training, performance appraisal and compensations. a) Recruitment and Training Job recruitment has become a critical issue, as new technologies require ever-higher levels of education and skills. Employees at all levels need to have more general skills and the ability to learn new skills rapidly. Technologies can be purchased but people have to be developed. Capable people are the foundation of high quality products, processes and services. Renowned companies and organizations always invest heavily on trainings and in the end they get success in achieving TQM.

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b) Performance Appraisal Performance appraisal is used for decisions involving compensations, training and promotion. Performance is a function of both the individual and the system in which the individual works. In a TQM environment people want to do an excellent job and will if they are properly motivated allowed to participate and provided with adequate training. In conventional performance appraisal a manager or a supervisor evaluates the work of a subordinate by reviewing his accomplishments, strengths and weaknesses and rating the individual according to various criteria. c) Compensations Many TQM focused companies now base their compensation on the market rate for an individual with proven capabilities and then increase the employees wages and responsibilities. A well-designed pay,
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benefit and reorganization system provides motivation to employees. 2. Improving Management Practices According to Deming and Juran upwards of 85 to 95 percent of quality problems are the responsibility of management not the workers. Therefore continuous improvement programs focusing on the workforce give limited results. Greater results can be achieved through improved management practices. The Malcolm Baldrige National Quality Award is such an example to provide a comprehensive set of guidelines for improving management practices leading to higher quality and productivity.

3. Improving Products and Services The function of quality engineering includes evaluation and improvement of design of products.
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Important techniques of quality engineering include value engineering and design reviews. a) Value Engineering Value engineering analyze the function of every component of a product, system, or service to determine how that function can be most economically accomplished without degrading the quality of the product or service. Specifically, value engineering refers to cost avoidance or cost prevention before production. b) Design Reviews Design reviews are planned evaluations of designs, raise questions and generate to value and new ideas for improvement. In design reviews issues like, product function, conformance costs, conditions customer and products needs, testing, are manufacturing environmental reliability and considered.
66

appearance,

engineering

documentations

4. Improving Productions Processes Methods for improving production processes include the traditional techniques of industrial engineering such as methods analysis, work measurement, maintenance with the help of new concepts like Just In Time.

Just In Time Just In Time is a quality and scrap control tool. The basic philosophy behind Just In Time is to produce only units to keep the next work station in operation. Just In Time cannot function if production has a high rate of defects.
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5. Improving Quality System The improvement in the quality system can be achieved with the help of quality audits. A quality audit is a systematic and independent examination and evaluation to determine whether quality activities and results comply with planned arrangements and whether these arrangements are implemented effectively or not. Quality audits are necessary for several reasons: Audits provide benchmarks for determining whether the quality system is complete Audits make every one aware the organization is serious about continuous improvement in quality

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BENCH MARKING Benchmarking is the search for best practices that will lead to superior performance. Benchmarking helps a company learn its strengths and weaknesses and those of competitors and incorporate the best practices into its own operations. Benchmarking was firstly initiated by Xerox whose business products and systems division won the Malcolm Baldrige National Quality award. There are two types of benchmarking: 1. Competitive Benchmarking 2. Generic Benchmarking Competitive benchmarking is usually focuses on products, manufacturing operations and customer service systems. The generic benchmarking, evaluates processes or business functions against the best companies.
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In order to be effective, benchmarking must be applied to all facets of a business. For example, Motorola encourages everyone in the organization to ask, who is the best person in my own field and how might I use some of their techniques and characteristics to improve my own performance in order to be the best (executive, manager, chief, purchasing agent, designer, etc.) in my class. The benchmarking process can be described in the following way: 1. Determine which function to benchmark This focuses on performance and key dimensions of competitiveness. For example, if fast response is an important dimension of competitive advantage, then processes that might be benchmarked would include order processing, purchasing, production planning and product distribution.

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2. Identify key performance indicators in measurement like direct link with customers needs and expectations 3. Identify best in class processes. For specific business functions benchmarking might be limited to the nature of business. For example a bank in one country might be benchmark the check processing operations of a bank in another country. 4. Meeting the needs or performances. This requires changing organizational systems to achieve or exceed the performance of the best. Flowcharts A flowchart is a picture that shows the sequence of steps that are performed. Flow charts are best developed by the people involved in the process employees, supervisors, managers and customers. A facilitator is often used to provide objectivity to ask the right questions and to resolve the conflicts. The
71

facilitator can guide the discussion b asking questions such as what happens next? Who make the decision at this point? And what operation is performed here? Flowcharts help the people who are involved in the process understand it better and more objectively. By participating in the development of flow charts workers begin to feel a sense of ownership in the process and who their suppliers and customers are? Once flowchart is developed it can be used to identify quality problems as well as areas for improvement.

Check Sheets Check sheets help in compilation of data. When designing a process for data collection one must first ask some basic questions such as, What question are we trying to answer?
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What type of data will we need to answer the question? Tools for Data Collection and Analysis There are seven quality control tools that are used for gathering Flowcharts Check sheets Histograms Pareto Diagrams Cause and Effect Diagram Scatter Diagrams Control Charts Types of Data Data may be attribute or variable. Attributes assume one of two values conforming or not conforming within tolerance or out of tolerance, complete or incomplete. Attributes data are collected by counting. and analysing data for fact based management. These tools are:

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Variables are appraisal in terms of measurable values on a continuous scale, for example, length, weight or time. Variables data are collected through measurement.

Example Attributes Percent accurate invoices for service. Number of lost parcels Number of hours per week documents. Number of complaints Mistakes per week Time to process travel expenses accounts. Days from order receipt to shipment. correcting Variation Time waiting

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The practice of identifying best practices in industry and thereby setting goals to emulate them is known as benchmarking. Companies cannot afford to stagnate; this guarantees a loss of market share to the competition. Continuous improvement is a mandate for survival and benchmarking facilitates such fast paced improvement. This practice enables an organization to accelerate its rate of improvement. Specific steps for benchmarking vary from company to company but the fundamental approach is the same. One companys benchmarking may not work at another organization because of different operating concerns. Successful benchmarking reflects the culture of the organization works within the existing infrastructure and its harmonious with the leadership philosophy. Motorola Inc, uses a five step benchmarking model: 1. Decide what to benchmark 2. Select companies to benchmark
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3. Obtain data and collect information 4. Analyse data and form action plans, and 5. Recalibrate and start the process again A primary advantage of the benchmarking practice is that it promotes a thorough understanding of the companys own process. Secondly benchmarking enables companies of performance measures in different dimensions, each with the best practice for that particular measure. It is not merely a comparison that is the best for the chosen measure. Some common performance measures are return on assets8, cycles time, percentage of on time delivery, percentage of damaged goods, proportion of defects and time spent on administrative functions. Another advantage of benchmarking is its focus on performance measures and processes, not on the product. Thus benchmarking is not restricted to the confines of the industry in which the company resides. It extends beyond these boundaries and identifies organizations in other industries that are superior with
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respect to the chosen measure. It is usually difficult to obtain data from direct competitors. However, companies outside the industry are more likely to share such information. It then becomes the task of management to find ways to innovatively adapt those best practices within their own environment.
B E N C H M A R K I N G

Organizational Culture of Empowerment

Performance Measurement

Strategic Commitment

Training for Technical Skills

Motivation through reward and recognition

Resources Commitment

SOFT SYSTEM SYSTEM

HARD

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Figure demonstrates how benchmarking brings the soft and hard systems together. Benchmarking is not merely the identification of the best practices; rather it seeks to determine how such practices can be adapted to the organization. The real value of benchmarking is accomplished only when the company has successfully integrated the identified best practices into its operation. To be successful in this task soft and hard systems must mesh. Technological development is another impetus for benchmarking. Consider the microelectronics industry. Its development pace is so rapid that a company has no choice but to benchmark. Falling behind the competition in this industry means going out of business. In this situation, benchmarking is critical to survive.

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QUALITY CONTROL IN SERVICE SECTOR Today service industries dominate our economy. The service sector accounts for more than 70% of jobs and the number continues to grow. In service industries not only must the product meet the fundamental requirements of the customer but the employee behaviour must also meet high standards. The total service concept is a combination of technical and human behavioural aspects.
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Let us consider the airline industry. A quantifiable goal is to transport people between two cities in a desirable time. The achievement of this is dependent on aircraft design that enables certain speeds to be attained to cover the distance within the required time and on proper scheduling of flights. Data on these factors is clearly quantifiable. However, customer satisfaction is often influenced by factors that are not so easy to quantify. For instance, the manner in which stewardesses and ticket agents treat the customers is very important. Courteous and friendly and warm and caring are not so obviously quantified. Thus the manner in which the source is performed is an important concern that might not be considered in manufacturing industries. Functions performed by industries include education, banking, governmental services, health care, insurance, marketing, personal services (hotels & motels), restaurants, travelling and tours, public
80

utilities (electricity, gas and telephone services) and transportation (airlines, railroads and buses). Two parties are involved in providing a service. The one that assists or provides the service is the vendor, or company and the party receiving the service is the vendee or customer. Differences in the Manufacturing And Services Sectors Basic differences in the manufacturing and service sectors are given below: S. No. 1. 2. 3. Manufacturing Sector Product is tangible Back orders possible are Service Sector Service consists of tangible and intangible components. Services cannot be stored, if not used, they are lost Producer and consumer are both involved in the delivery of the service

Producer or company is the only party involved in the making of the

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4. 5.

product Product can be resold Customer usually provides formal specifications for the product

Services cannot be resold Formal specifications need not to be provided by the consumer. In fact in monopolies involving public utilities such as electricity, gas, telephone, etc. federal and state laws dictate the requirements. Customer satisfaction is difficult to quantify because a behavioural component associated with the delivery of the service is involved. Rendering of a service takes place over an interval of time.

6.

Customer acceptance of the product is easily quantifiable. Ownership of a product changes hands at a specific point in time.

7.

SERVICE QUALITY CHARACTERISTICS The quality characteristics are grouped into four categories. They are given as under: 1. Human Factors and Behavioural Characteristics

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Service quality is influenced by the attitude and behaviour of the provider. Human factors include intensity, eagerness to help, thoughtfulness, complacency, courtesy and so on. Some of these traits can be developed through adequate training; some are inherent in the individual. Proper screening of employees and appropriate job assignment are ways to achieve desirable quality characteristics. A primary source of customer complaint is discourteous behaviour. 2. Timeless Characteristics A service that is not used in a given span of time cannot be stored for later use. A hospital with empty beds during certain days of a month cannot save them for use in the following month. Thus the timelines with which a service is performed is critical to customer satisfaction. How long did the customer have to wait in line to cash a cheque? Characteristics related to timeliness are categorized by the service phase with which they are associated. Categories
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may include the time to order the service, the waiting time before the service is performed, the time to service and the post service time. 3. Service Nonconformity Characteristics These characteristics deal with deviation from target performance levels; non-conformity is a deviation from the ideal level. Examples of such characteristics include the number of errors in processing per 100 vouchers by bank employees, the number of data entry errors per 1000 key strokes by a data entry operator, the number of billing errors per 100 accounts by a utility company and so on. The target performance level for these examples is zero non conformities. The goal of the service organization is to achieve the target level, thus meeting customer expectations and then exceed it through quality improvement measures. 4. Facility Related Characteristics

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The physical characteristics of the facilities associated with a service and its delivery can impact customer satisfaction. The waiting area in a bus station and the availability of such amenities as a swimming pool in a hotel are examples of quality characteristics for physical facilities that are involved in providing a service. The appearance of a waiter or waitress, an insurance agent is attributes of individuals performing a service. DEMING'S 14 POINTS FOR MANAGEMENT The focus of Deming's philosophy is management. Management can solve a major proportion of problems. Only a minority of problems can be attributed to suppliers or workers. So in Deming's view, what must change is the fundamental style of management. In Deming's ideal organization, workers,

management, vendors, and investors are a team. However, without management commitment, the
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adoption and implementation of a total quality system will not succeed. It is management who creates the culture of workers "ownership" and their investment in the improvement process management who creates the corporate culture that enables workers to feel comfortable enough to recommend changes. It is management who develops the long-term relationship with vendors. And finally, it is management who convinces investors of the long-term benefits of a quality improvement program. Deming's 14 points for management provide the necessary sense of direction. The adoption of these points will sustain productivity and competitiveness of the company in the long run. Deming's Point 1 Create and publish to all employees a statement of the aims and purposes of the company or other organization. The management must

86

demonstrate, constantly their commitment to this statement. This principle stresses the need to create long-term strategic plans that will steer the company in the right direction. Mission statements should be developed and clearly expressed so that everyone in the organization understands them. This includes not only everyone in the organization but also vendors, investors, and the community at large. Mission statements address such issues as the continued improvement of quality and productivity, competitive position, stable employment, and reasonable return for the investors. Deming's Point 2 Learn the new philosophy, top management and everybody. Everyone must adopt the new attitude. Quality consciousness must be every thing to everyone.
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Previously acceptable levels of defects should be abandoned; the idea that improvement is a neverending process must be embraced wholeheartedly. Human beings are resistant to change. Managers who have been successful under the old system where certain levels of defects were acceptable may find it difficult to accept the new philosophy. Overcoming this resistance is a formidable task, and it is one that only management can accomplish. The idea is not only to continually reduce defects but also to address the needs of the customer. Deming's Point 3 Understand the purpose of inspection, for improvement of processes and reduction of cost. Quality has to be designed into the product; it cannot be inspected into it. Creating a "design for manufacturability" is imperative because producing the desired level of quality must be feasible.
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Inspection merely separates the acceptable from the unacceptable. It does not address the root cause of the problem that is, what is causing the production of nonconformities and how to eliminate them. The emphasis is on defect prevention, not on defect detection.

Deming's Point 4 End the practice of awarding business on the basis of price tag alone. Many companies, as well as state and federal governments, award contracts to the lowest bidder as long as they satisfy certain specifications. This practice should cease. Companies should also review the bidders' approaches to quality control. What quality assurance procedures do the bidders use? What methods do they use to improve quality? What is the attitude of management toward quality? Answers to these questions should be used, along
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with price, to select a vendor, because low bids do not always guarantee quality. Deming's Point 5 Improve constantly and forever the system of production and service. In Deming's philosophy, companies move from defect detection to defect prevention and continue with process improvement to meet and exceed customer requirements on a never-ending basis. Defect prevention and process improvement are carried out by the use of statistical methods. Statistical training is therefore a necessity for every one and should be implemented on a gradual basis. Deming Cycle The continuous cycle of process improvement is based on a scientific method originally called the Shewhart cycle after its originator Walter A. Shewhart. He also developed control charts. In the 1950s, the
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Japanese renamed it the Deming cycle. It consists of four basic stagesplan, do, check, and act (the PDCA cycle). Plan Stage: In are this stage, opportunities and for

improvement

recognized

operationally

defined. A framework is developed that addresses the effect of controllable process variables on process performance. Since customer satisfaction is the focal point, the degree of difference between customer needs satisfaction Do Stage: The theory and course of action developed in the plan stage is put into action in the do stage. Trial runs are conducted in a laboratory or prototype setting. Feedback is obtained from the customer and from the process. Check Stage: Now the results are analyzed. Is the difference between customer needs and process
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performance reduced by the proposed action? Are there potential drawbacks relating to other quality characteristics that are important to the customer? Act Stage: In the act stage, a decision is made regarding implementation. If the results of the analysis conducted in the check stage are positive, the proposed plan is adopted. Customer and process feedback will again be obtained after full-scale implementation. Such information will provide a true measure of the plan's success. If the results of the check stage show no significant improvement, alternative plans must be developed, and the cycle continues. Deming's Point 6 Institute training. Employee training is integral to proper individual performance in the extended process setting. If employees function in accordance with the goals of
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the

company,

an

improvement

in

quality

and

productivity results. This in turn reduces costs and increases profits. Employees are the fundamental assets of every company. When employees are hired, they should be carefully instructed in the company's goals in clear-cut operational terms. Merely stating that the company supports a total quality program is not sufficient. Instead, employees must know and buy into the company's long-term goals. Understanding these goals is essential to performing adequately. Employees' individual goals may not always be compatible with those of the company. For example, an employee's desire to produce 50 items per day may not be consistent with the company's goal of defect-free production. Instruction enables the employee to understand what his or her responsibilities are for meeting customers' needs.

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Deming's Point 7 Teach and institute leadership. Supervisors serve as vital links between management and (he workers. Since there is usually no direct contact between these two groups, supervisors have the difficult job of maintaining communication channels. Thus, they must understand both the problems of the workers and top management's goals. Communicating management's commitment to quality improvement to the workers is a key function of supervisors. Supervisors are in the best position to identify common causes inherent to the system, causes for which the workers should not be blamed. It is management's responsibility to minimize the effects of common causes. Special causes, such as poor quality of an incoming raw material, improper tooling, and poor operational definitions should be eliminated first. Identification of these special causes can be accomplished through the use of control charts.
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Deming's Point 8 Drive out fear. Create trust. Create a climate for innovation. Functioning in an environment of fear is

counterproductive, because employee actions are dictated by behaviour patterns that will please supervisors rather than meet the long-term goals of the organization. The economic loss associated with fear in organizations is immense. Employees are hesitant to ask questions about their job, the methods involved in production, the process conditions and influence of process parameters and other such important issues. A fear filled organization is wasteful. The process of eliminating fear starts at the top.

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Deming's Point 9 Optimize towards the aims and purposes of the company the efforts of teams, groups, and staff areas. The presence of barriers impedes the flow of information, prevents each entity in the extended process from perceiving organizational goals. The barriers may be internal or external. Poor communication is often a culprit in barrier creation. Perhaps top management fails to model open and effective communication. Deming's Point 10 Eliminate exhortations for the workforce. Numerical goals such as a 10% improvement in productivity set arbitrarily by management have a demoralizing effect. Rather than serving to motivate, such standards have the opposite effect on morale and productivity.
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If the process is stable, the employees have no means of achieving the goal unless management changes the process or the product. Management has to come up with a feasible course of action so the desired goal can be achieved. Failing to do so will lower morale and productivity. By taking such an action, management is basically shirking its responsibility. Hence, goals should be set by management in a participative style, and procedures for accomplishment should be given. Management should demonstrate its commitment to the never-ending process of quality improvement. Rather than providing slogans, they should describe precisely. Deming's Point 11

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a) Eliminate numerical quotas for production. Instead, learn and institute methods for improvement. b)Eliminate M.B.O. (management by objectives). Instead, learn the capabilities of processes, and how to improve them. Work standards are typically established by someone other than those who perform the particular job in question. They are based on quantity without regard to quality. According to Deming, setting such work standards guarantees inefficiency and increases costs. The numerical quota defined by a work standard may derail implementing the Deming improvement cycle because people naturally strive to meet the quota rather than to produce acceptable goods.

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Deming's Point 12 Remove barriers that rob people of pride of workmanship. A total quality system can exist only when all employees synergistically produce output that conforms to the goals of the company. Quality is achieved in all components of the extended process when the employees are satisfied and motivated, when they understand their role in the context of the organization's goals, and when they take pride in their work. It is management's duty to eliminate barriers that prevent these conditions from occurring. A direct effect of pride in workmanship is increased motivation and a greater ability for employees to see themselves as part of the same teamthe team that makes good things happen. Factors That Cause a Loss of Pride

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Several

factors

diminish

worker

pride.

First,

management may not treat employees with dignity. Perhaps they are insensitive to workers' problems (personal, work, or community). Happy employees are productive, and vice versa. Happy employees don't need continuous monitoring to determine whether their output is acceptable. Second, management may not be communicating the company's mission to all levels. How can employees help achieve the company's mission if they do not understand what that mission is? Third, management may assign blame to the employees for failing to meet company goals when the real fault lies with management. If problems in product output are caused by the system (such as poor-quality raw materials, inadequate methods, or inappropriate equipment), then employees are not at fault and should not be penalized.

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Deming's Point 13 Encourage education and self-improvement for everyone. Deming's philosophy is based on long-term,

continuous process improvement. To meet this goal, the organization's most important resource, its people, have to be motivated and adequately trained. This is the only way the company can survive in today's highly competitive business environment. Management must commit resources for education and retraining. This represents a sizable investment in both time and money. However, an educated workforce, with its eye on future needs, can safeguard improvements in quality and productivity and help the company maintain a competitive position. Deming's Point 14 Take action to accomplish the transformation.

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Point 14 involves accepting the Deming philosophy and committing to seeing its implementation in the extended process. A structure must be created and maintained for the dissemination of the concepts associated with the first 13 points. Responsibility for creating this structure lies with top management. Besides being totally committed to the idea of quality, management must be visionary and knowledgeable as to its potential impacts, and they must be in it for the long run. For the implementation to succeed, people must be trained in statistics at all levels of the organization. A quality company requires statistical assistance at every level.

IMPLEMENTATION OF TQM The TQM implementation process begins with senior managements and most important the CEOs

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commitment.

The

importance

of

the

senior

management role cannot be overstated. Leadership is essential during every phase of the implementation process and particularly at the start. Timing of the implementation process can be very important. Is the organization ready to embark on the total quality journey? There may be some foreseeable problems e.g. reorganization, interpersonal conflicts, etc. These problems may postpone implementation to a more favorable time. The next step is the formation of the quality council. The membership and duties follow. QUALITY COSTS One measure of the performance of the total quality system is the cost associated with it. Careful identification, measurement and analysis of cost as a function of time aids in tracking the impact of an effective quality control system.
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The benefits of a quality system, as measured by the total quality costs, may be realized in the long run rather than in the short run. An American Society for Quality Control has defined four major categories for quality costs, which are as under: 1. Prevention Costs Prevention costs are incurred in planning, implementing and maintaining a quality system. They include salaries and development costs for product design, process and equipment design, process control techniques, information system design and all other costs associated with marking the product right the first time. Costs associated with education and training are included in this category. Other such costs include

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those associated with defect cause and removal, process changes and the cost of quality audit. 2. Appraisal Costs Appraisal costs are those costs associated with measuring, evaluating, or auditing products, and components or purchased materials to determine their degree of conformance to the specified standards. Such costs include dealing with the inspection and test of incoming materials as well as product inspection and testing at various phases of manufacturing. Other costs in this category include the cost of calibrating and maintaining measuring instruments and equipment. 3. Internal Failure Costs Internal failure costs are incurred when products, components, materials and services fail to meet quality requirements prior to the transfer of ownership to the customer. These costs would

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disappear if there were no non-conformities in the product. Internal failure costs include scrap and rework costs for the materials, labour and overtime associated with production. The cost of correcting nonconformities as in rework also is the internal cost. The cost of lost production time is also the internal failure cost. 4. External Failure Costs External failure costs are incurred when the product does not perform satisfactorily. If no non-conformity units were produced this cost would vanish. Such costs include those due to customer complaints, which include the costs of investigation and adjustments. Warranty charges i.e. failure of a product within the warranty time and product liability costs also fall under this category.

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misconception

that

has

existed

among

businesses is the notion that quality decreases productivity. On the contrary, the relationship between the two is positive i.e. quality improves productivity. Making a product right the first time lowers total costs and improves productivity. In fact, doing it right the first time increases the available capacity of the entire production line. Valuable resources people, equipment, material, time and effort can be utilized for added production of defect free goods or services. The competitive position of the company is enhanced in the long run and an improvement is observed in profits.

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MANAGEMENT OF QUALITY Management of the total quality system is achieved through the functions of; planning, organizing, staffing, directing and controlling. The major objectives of the management are to integrate all processes and functional units to meet the goals of the company. Management is responsible for the prevention of non-conformities and their goal is to design, manufacture, and maintain the product or the service at the least possible cost while still meeting all customer requirements.

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Presently, companies are finding out that meeting customer requirements is not always enough to remain competitive. Companies have to satisfy their customers to such a degree that they continually repurchase the product. This feat can be achieved only through an organized and thorough evaluation and analysis of performance data integrated into the design phase. FUNCTIONS OF MANAGEMENT IN THE QUALITY SYSTEM The management may play a decisive role in the implementation they are as under: of the quality system. The implementation is carried out at their functional levels.

1. Planning for Quality

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In the planning process, the company considers its quality mission and objectives as its key qualities as perceived by the consumer, its market commitments and its available human resources and production facilities. Quality planning may be categorized as administrative plans and product oriented plans. Administrative plans deal with the operational aspects of the company. While product oriented plans, on the other hand may cross-functional lines such as, marketing, product and process design and engineering. 2. Organizing For Quality An organizational structure is created to establish lines of authority and responsibility. The major activities involved in organizing for quality consists of defining quality-related between activities them, and the interrelationship assigning

responsibility for each of the tasks and sub dividing tasks down to the worker level.
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3. Staffing for Quality An organization should staff its managerial positions with candidates certified in the appropriate quality area. Additionally, a company can send its personnel to workshops on quality and can give them incentives to become certified (either through salary increase, promotion or acknowledgement through awards). Motivating employees to produce a quality item is critical to the success of the quality program. 4. Directing for Quality Once quality has been incorporated into the design of the product, the production phase takes measures to ensure that the produced item conforms to the design specifications. The top management ensures about the implementation of the set goals. Certified and trained inspectors inspect the activities and report to the top management. 5. Controlling for Quality
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The control aspects occur during the production and postproduction phases. The objective is to determine out of control process conditions and nonconformance as early in the production phase as possible. To achieve this, procedures are established to obtain relevant process information on a timely basis. Another important concern deals with controlling the costs of quality.

TOTAL QUALITY ENVIRONMENTAL MANAGEMENT

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In recent years, we have witnessed the emergence of many national regional standards in the environmental management field. Some companies have long felt a social responsibility to operate and maintain safe and adequate environmental, regardless of whether outside standards required it. With the concern for protection of the environment that is mandated in regional and national standards, standards need to be developed in environmental management tools and systems. British Standards Institutes BSI 7750 Standards on environmental management is one such example, the European Unions Echo Label and Eco Management and Auditing scheme are other examples. Similarly, in the United States, technical environmental standards have been developed and published that address the testing and monitoring associated with emission and effluent controls.

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The International Organization for Standards (ISO) based in Geneva, Switzerland, has long taken the lead in providing quality management standards. Its ISO 9000 standards have become a benchmark for quality management practice. In addition to this ISO 14000 referring Environmental Management day operations Standards that have and an deals impact on with the Environmental Management Systems for the day to environment. This will address issues such as Environmental Management System, Environmental Auditing, Environmental Performance Evaluation Life Cycle Assessment and Environmental Labeling Environmental Aspects in Product Standards. Environmental Management is a regulation based and compliance driven system. These standards are therefore span a not product of standards. These Environmental include top Management Systems and Environmental Auditing variety issues.
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management

commitment

to

continuous

improvement, compliance and pollution prevention, creating and implementing environmental policies, setting appropriate targets and achieving them. Several benefits will accrue from the adoption of the Environmental Management System Standards. First and the foremost is the worldwide focus on environmental management that the standards will help to achieve. At the commercial level, ISO 14000 will have an impact on creating uniformity in national rules and regulations, labels and methods. They will minimize trade barriers and promote a policy that is consistent. QUALITY IMPROVEMENT TOOLS The quality improvements tools are as under: 1. Collection/ Stratifying of Data This exercise helps in analyzing the problem and is accomplished by:

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a) Presentation of data Sheets To collect information on large number of variables. b) Checking of Sheets Important to note Stating the full title of the data to be collected and time period covered. Checking that sheets are uniform Writing is kept to a minimum Advantages: Provides visual Impact Shows a picture of the Distribution c) Run Chart or line graph This illustrates how a process change over time, it is an effective tool for presenting data.

Advantages: Provides visual Impact Cycle pattern can be easily seen

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2. Flow Diagram The simplest way of describing or mapping a process is to draw a flow chart used for planning action. The flow chart maps the stages of a process from starting point to its completion point. Each action of the process, each decision taken and arrows that point forward and at times point back to an earlier stage in the process. The following steps should be followed to construct a process flow chart: Identify the subject of the flow chart. Determine the starting and end points. Stratify the tasks into the smallest possible sub tasks and list them. Measure the time, distance or quantity for each sub task. Calculate and record the frequency and time for each sub task.

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 Create the flow chart by utilizing the symbol for each task. Indicate a legend, which defines the symbols used.

3. Variation and Distribution Variation is a natural phenomenon and is universal. It follows some distribution patterns, which makes it possible to predict probability of occurrence of events. The variation may be represented by: a) Quincunx: This is a tendency of variations due to different causes to be in different directions thereby minimizing the effect of one another. b) Frequency Histogram: It distribution is a Diagrams showing or the diagram

frequency of occurrence of a given number. Histogram is a bar chart showing the distribution pattern of observations grouped in convenient class intervals and arranged in order of magnitude.
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Procedure: Collect data. Arrange all values in an ascending order. Divide the entire range of values into a convenient number of groups, each representing an equal class interval. Draw X Axis and Y Axis and decide appropriate scales for the groups. Draw bars representing the frequency for each of the groups. Provide a suitable title to the Histogram. Study the pattern of distribution and draw conclusions. 4. Graphs and Charts These are the most important tools of process control. Control charts are visual representation of variations in the selected parameters. Control

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charts guide one that when adjustments must be made. 5. Quality Related Tools and Techniques A. Brain Storming for generating ideas It is away of getting as many ideas as possible on a problem or a solution in the shortest possible time. It works most effectively when there is a group of people responding within the following framework: Do not discuss just concentrate on writing up ideas as quickly as possible without criticizing any thing that is said. Build on others suggestions by using the thoughts of others. Go for Quality by trying to write up as many ideas as possible within a period of time say 5 or 10 minutes. Be Imaginative quite often the most creative solutions come from initially draft ideas, avoid

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creating an environment when people are inhibited from putting forward ideas because others criticize or laugh at them. B. Cause and Effect Diagram A cause and effect diagram is a tool that shows systematic relationship between a result or a symptom or an effect and its possible causes. This tool was devised by Dr. K. Ishikawa and is also known as Ishikawa diagram. There are flow type diagram based on defining the probable cause of a problem and the identifying the likely major variables or causes of that problem under the four M approach materials, machines, manpower, and methods. When the diagram is complete resembles the skeleton of fish that is why it is also referred as Fish Bone Diagram.

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QUALITY SYSTEM LIKE ISO 9000 FOR A CHEMICAL INDUSTRY The quality of chemical production processes and products is largely influenced by the automation technology. Contributions from process control and instrumentations production. The are, main therefore points expected that when be certifying quality management systems for chemical should considered when certifying quality management systems for chemical production processes are: Methods for selection and technical specifications of the process control functions/equipment, which controls or tests the product quality

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 Recommendations for planning, installation and maintenance The concept is an economically sound conversion of ISO 9000 matched to the requirements of chemical production processes. PROCESS CONTROL AND INSTRUMENTATION IN THE CHEMICAL INDUSTRY Process control and instrumentation with which terms such as measurement, control, monitoring, output, display and recording have a long tradition in chemical production process of and are now indispensable achieved by comments testing; modern production and

processes. The quality of chemical products is not process control instrumentation are used to direct the production processes such that the products are generated with the desired quality.

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The following are the characteristics of process control and instrumentation in chemical production plants. Complex interconnection of individual devices into complex measurement and automation system i.e. process control equipment, consists of detectors, sensors, transmitters, signal processing, control, displays, input devices, recorders and final control, displays, input devices, recorders and final control elements as applicable. Fixed installation or process control equipment usually covering the process devices, switch room and process control rooms. The specialists of process control and instrumentation in the chemical industry are greatly interested in exchanging ideas and experiment and in representing interests in the field of measurement, control and automation. THE PROBLEM IN CHEMICAL INDUSTRY
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Companies in the chemical industry are being increasingly requested by their customers to certify their Quality Management Systems. This is carried out on the basis of series of ISO 9000 standards. The following elements are generally relevant to process control and instrumentation. Process quality control Test Equipment TARGETS The concept described pursues the following targets: The process control equipment should be systematically categorized with respect to functions for quality testing and generation, thus producing a method with which the series or standards ISO 9000 can be interpreted uniformly for process control equipment in the chemical industry.

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The concept is chiefly envisaged for process control equipment installed as fixed equipment in chemical production plants.

Mid Term Test Subject: Total Quality Management Note: Attempt any Three questions. 1. What are the Quality Characteristics define each one briefly. 2. Describe Basic Concepts of Quality Control.

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3. Describe important principles of Total Quality Management. 4. Discuss why Total Quality Management is needed?

QUALITY STANDARDS Quality Standards may be defined as a criterion that how a product or service should be assessed concerning three aspects namely: Quality Performance Environmental Impacts Products and services are standardized to ensure quality, performance and safety to both consumers and the environment.

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As for consumer, health and safety, quality standards, be they pharmaceuticals or food products, in home appliances or consumer products, promote and encourage improved quality of life. On the contrary, if goods and products, which are consumed by people, are of substandard, they may pose a health hazard to consumers and endanger their lives. Local brands of gas heaters of poor quality are an obvious example of this. These gas heaters emit unburned methane gas in the atmosphere and causes suffocation. In winter every year these gas heaters claim lives of many. The problem can partly be standards in gas heaters. Another important example in this regard is that of unclean and contaminated drinking water. It has been reported that about 80 percent diseases are waterborne and 40 percent deaths are attributed to the use of poor quality drinking water. This is largely because there exists no enforceable water quality
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standards in the country whereby its quality could be assessed. October 14 is celebrated all over the world by governments, standardization bodies, citizens, consumers and consumer groups as the World Standards Day. The purpose behind it was to stress the need for quality and standardization of goods, products and services. of The Day reminds the for establishment International Organization

Standards (ISO) which was established in London on October 14, 1944. Quality Standards are also essential for improving environment because quality goods and services tend to ensure maximum environment protection. It is for this reason that due importance is given in the implementation of the Quality Standards. For these reasons, much stress is laid on quality standards in developed
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countries

and

the

consciousness of having quality standards is also increasing in many developing countries. Pakistan lags far behind in this respect from many developing countries. As a result the markets are flooded with substandard and poor quality goods and products. At present, the only standardization body operating in the country is Pakistan Standards and Quality Control Authority (PSQCA). It was established in year 2000 under the Pakistan Standards and the Quality Control Authority Act 1996.

Question: What is ISO 9000? Answer: ISO 9000 is a series of International Standards for Quality Systems. They specify requirements and recommendations for the design and assessment of a management system, the purpose of which is to ensure that suppliers provide
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products

and

services,

which

satisfy

specified

requirements. These specified requirements may be specific customer requirements, where suppliers are contracted to supply certain products and services, or may be the requirements of a particular market as determined by the supplier. The requirements and recommendations apply to the organizations that supply the product or service and hence affect the manner in which the products and services are designed, manufactured, installed, delivered etc. They are standards, which apply to the management of the organization, and only the management can and should decide how it will respond to these requirements and recommendations. In broader sense: It is set of written standards laying down a Quality System.

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 It defines the basic elements of the system through documentation. It creates a Quality System rooted in accordance with the customers requirements. It focuses on the process assuming that Quality Process makes Quality System. It lets the organization to decide the method for itself but it is then to be consistently applied. A system approach to Quality Management. It is not a solution it is a catalyst. It is documenting the problem solving approach system. It wants an organization to keep records of what it does what it say. Question: Why is ISO 9000 is important? Answer: ISO 9000 is important internally and externally. Internally it is important as it:

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 Provides good platform for continuous quality improvement. Vehicle to hold quality improvement gains. Provide methods for involving non manufacturing areas in quality and quality improvement. Employees confidence increases. Job satisfaction, less confusion, elimination of panic. Externally it is important because: Customer confidence increases. Competitive edge. Number of countries insist ISO 9000 registration as pre condition for business i.e. export. Question: What are the main advantages of ISO 9000? Answer: The main advantages of ISO 9000 are as under:

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 Strengthens system discipline and the consistency in product quality. Motivation is improved, cooperative workmanship. International recognition of ability. Necessary pre requisite for export. Improves organizations efficiency. Goal Orientation. Team building. Role clarity and openness. Developing to marketing, after sales service, recruitment of personnel and training. Reduce wastage, quality cost, rejection rates, scrap, rework, and customer complaints. Provides good platform for continuous quality improvement. Better product design. Efficient utilization of resources and higher productivity. Elimination of bottlenecks in production and tension free environment leading to good human relations.
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Question: Describe the Parts of ISO 9000? Answer: The ISO 9000 series comprises of two basic types of standards they are: Those addressing Quality Assurance Those addressing Quality management The Quality Assurance Standards are designed for contractual and assessments purpose and are ISO 9001, ISO 9002 and ISO 9003. The Quality Management Standard is ISO 9004 together with all its parts and is designed to provide guidance for companies developing and implementing quality systems.
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The ISO 9000 series currently consists of the following published and planned documents. ISO 9000 1 - - - - > Quality Management and Quality Assurance Standards Guidelines for selection and use ISO 9000 2 - - - - > Guidelines for the application of ISO 9001, ISO 9002 and ISO 9003. ISO 9000 3 - - - - > Guidelines for the application of ISO 9001 to the development, supply and maintenance of software. ISO 9000 4 - - - - > Guide to dependability program management. ISO 9001 - - - - > Quality Systems Model for Quality Assurance in design, installation and servicing. development, production,

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ISO 9002 - - - - > Quality Systems Model for Quality Assurance in production and installations. ISO 9003 - - - - > Quality Systems Model for Quality Assurance in final inspection and test. ISO 9004 1 - - - - > Quality Management and Quality System elements Guidelines. ISO 9004 2 - - - - > Quality Management and Quality System elements Guidelines for services. ISO 9004 3 - - - - > Guidelines for processed materials. ISO 9004 4 - - - - > Guidelines for Quality Improvement. ISO 9004 5 - - - - > Guidelines for Quality Plans. ISO 9004 6 - - - - > Guide to Quality Assurance for Project Management. ISO 9004 7 - - - - > Guidelines for Configuration Management.

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Total

Quality

Management

(TQM)

performance objectives
Q a) Explain the 5 TQM performance objectives. Discuss these with the help of a real life example of a process involving products & services, and analyze how the process can be improved upon? b) Illustrate & explain your chosen process with the help of a transformation model.

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Answer a) Many methodologies and techniques for improving operational performance have been developed over the years these provide structured ways of improving company performance, but they do not explicitly tell us where to start. To be able to improve performance effectively, it is important to identify the particular factors of performance to work with. Furthermore, it is important to find those factors that have a high impact on performance. (www.emeraldinsight.com) Performance improvement highlights processes and systems that need to be improved. Then, there is a follow-up with an action plan to improve the outcomes. The five main performance objectives are: Speed Cost Quality Dependability Flexibility We will discuss these five objectives using the drive-thru process of McDonalds: Speed- How much time does a customer spend in McDonalds drive-thru? McDonalds drive-thru target is 90 seconds. But, is it really able to achieve this target? No, not all the time. Many people have complained about drive-thru errors, waiting for their meals in busy times, being stuck in the queue, etc. As the line gets longer, more people choose to bypass the restaurant and dine elsewhere. So, how can McDonalds overcome these problems? ? Proper drive thru management: Since queuing is on a strict first-in first-out basis; later customers are generally not served until all previous customers have been taken care of. Therefore, a whole line of people with quick orders can be held up by a single complex order. McDonalds can instead have a dual line layout & if the second customers order is ready first, then a green light can be used to signal the second car, so that the person takes his/hers order & goes. Service times are improved dramatically for short orders, yet not impacted for longer orders due to multiple wait queues. The disadvantage of adopting the dual line layout is that it will take up a lot of time & be costly for McDonalds to change the layouts of all their restaurants. Plus, some customers will get really annoyed if they came in first but served second. To overcome this, McDonalds can have two windows (both left & right), the left one for large orders & the right one for small orders. Again, the question is how the small order meals will be bought to the right window if the kitchen is on the left side. Well, an employee can be especially dedicated to transfer the meals from the left window to the right one! ? Introduction of the use of mobile order entry terminals: will allow a restaurant employee to physically go to the drive-through lane and enter orders, which increases through-put by providing two points of entry: the menu sign and the mobile order entry terminal. Problems associated with this option include: (1) interfacing the mobile entry terminal to the current POS (Point of Sale) system; (2) supporting multiple languages and interfaces; (3) constant menu changes and additions; (4) safety of the employee; (5) weather conditions; (6) hardware costs; (7) order sequencing; and (8) the customer is unable to review the menu prior to ordering.

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? Adopt a new system: McDonalds can also adopt a new system called Delphi Order Confirmation where a digital camera is attached to the drive-through menu system. When an order is placed, a photo is taken of the car and/or the driver from approximately the same angle and distance that the drive-through employee would view when the car is at the payment or presenter window. The digital photo would be matched to the order record created by the POS system. The photo and order record could be presented in a variety of fashions, including a print out on the receipt with the itemized order and number. Alternatively, a touch screen with the patron's picture and order record for each of the cars currently in the drive-through, and when the order is complete, the presenter would tap the photo on the touch screen indicating the order has been filled and the photo record would be removed from the system. This system will help shave about eight seconds from the order to delivery time. Besides order accuracy, it will also aid in speeding up the drive-thru process and address customer courtesy issues. Specific benefits to this system include easy installation and implementation with existing QSR (Quick Serve Rest) drive-through installations; minimal ongoing support required; limited risk of hardware loss/damage; increased employee safety; fully supported in multi-language settings; and continues to provide the customer an opportunity to review the menu! (www.freepatentsonline.com) People will be uncomfortable: with the idea, that they're being photographed every time they make a quick stop for a double cheeseburger with fries. Though, its a "noninvasive" procedure & the photos aren't stored in the system. They're deleted as soon as the order is completed. A lot of restaurants already have surveillance cameras on their premises that photograph people. Another trouble is that it will be costly for McDonalds to implement this system. But then again, it will show good results in the long run! Cost- Is McDonalds charging a lot to its customers? Can they bring down its costs further? ? Value meal strategy: McDonalds can employ the value meal strategy which allows customers to buy a sandwich, french fries, and beverage at a discount when purchased together. Moreover, it can also offer daily specials of special menu items, such as 9 Dhs Happy meal on Thursdays, from 4:00 PM - 8:00PM or other similar specials. More number of people will be attracted by such offers & hence McDonalds average cost will decrease. However, the limitation is that these daily specials will bring in a lot of customers but also make it harder for McDonalds staff to handle so many people together & serve quickly!!! So, they should anticipate having so many customers & moulding their operations according to that. ? During busy periods, McDonalds requires more than two to three people who are dedicated to the drive-through process. If it adopts the Delphi order system mentioned on page 2 & 3, it will not require a lot of employees to take the orders, enter in the system & make mistakes in matching the orders with the cars, hence cutting down on its costs. However, this might lead to some employees being made redundant. ? Use Customer order Display: When a drive through worker is taking an order, it can be displayed automatically on a screen available to the customer outside, called the

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Customer Order Display (COD). The customer can review the COD and correct any mistakes, thus making the ordering process more precise. More precise orders eliminate time wasted from correcting mistakes & the cost arising from order errors. ? Energy management: Energy costs represent a significant portion of restaurant expenses. Parking-lot lighting, cooking appliances, ventilation systems, & other utility expenses can add up. These are very real costs that impact the profitability of a restaurant. McDonalds can invest in new equipment (which might be costly but beneficial in the long run), maintenance practices and revising some operating procedures. Some cost-cutting strategies include are, investing in energy-saving equipment, securing longterm energy contracts, joining energy co-ops, controlling lighting schedules more efficiently, tinting windows, contracting with new energy providers, hiring energy consultants and decreasing deliveries, regular cleaning and upkeep of refrigerator coils. Furthermore, a calendar with the recommended maintenance dates for all parts and equipment, including monthly, quarterly and annual checks can be made. (www.restaurant.org) Quality- Where does McDonalds stand in terms of is service? Not as good as it used to be. Probably the meals are okay, but what about the employees serving the customers & the overall experience which the customers go through? ? Surprise quality checks: For sure, all McDonalds restaurants already go through periodic inspections in terms of quality checks, but they can have more surprise checks & if the store fails to pass the inspection the second time, the corporate can take over the store and bring in better employees to ensure that the proper processes and equipment are being used properly. ? Improve the training process & taking care of employees: McDonalds can include online e-learning tools for its restaurant staff. In addition to this, it should make sure that the needs of its staff are met & they are given recognition for good performance. Once this is done, automatically they will be happy to do their jobs & of course happy employees will lead to a better service & eventually happy customers! Dependability- How can McDonalds make its processes more reliable? ? If McDonalds opts for dual line layouts & a reliable system like Delphi order confirmation system (mentioned on pages 2 & 3,) then without any doubt its customers can rely on its operations. They will be sure that their meals will always be ready within a specified time without any errors & theyll be able to get out quickly with the dual line layout.

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 Flexibility- Can McDonalds adjust its processes to meet customer requirements? ? Multiple trained staff: McDonalds can have a multiple trained staff in order to be flexible. Again, this will cost money but be beneficial in the long run. ? Ordering on a toll free number: McDonalds can give their customers the option to place their order by calling on a toll free number & giving them a unique order number so that their meals are ready when they come to pick them up. The drawback is that an employee will have to be specially delegated to take the orders when customers call! Answer b) A transformation process is any activity or group of activities that takes one or more inputs, transforms and adds value to them, and provides outputs for customers. Where the inputs are raw materials, it is relatively easy to identify the transformation involved, as when milk is transformed into cheese and butter. (openlearn.open.ac.uk) Where the inputs are information/people, the nature of the transformation may be less obvious. For example, a hospital transforms ill patients (the input) into healthy patients (the output). Figure 1: The transformation model Source: (openlearn.open.ac.uk) The transformation model of a McDonalds drive-thru process will look something like this: Feedback Figure 2: Transformation model of McDonalds drive-thru A customer enters the drive-through in his/her vehicle along a path and stops at a sign/menu-board that contains a menu. The customer is prompted by an order-taker to order his/hers desired meal. Once the order has been confirmed, the driver proceeds (while his/her meal is prepared & packed) toward a drive-through pickup window, in queue behind any previous cars, where the driver submits his/her payment to a window person and then receives his/her food. Some restaurants use a two-window system during busy times, whereby the driver pays at a payment window and receives his food at the pickup window. Figure 3: Drive-thru process shown in pictures Source: (www.google.com) Inputs & Output Some inputs are used up in the process of creating goods or services; others play a part in the creation process but are not used up. Three types of resource that may be transformed in operations are: materials the physical inputs to the process information that is being processed or used in the process customers the people who are transformed in some way. Many transformation processes produce both goods and services. For example, McDonalds provides a service, but also produces goods such as food and drinks.

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Transformation processes may result in goods/services (output) that are designed to deliver.

What is benchmarking? Benchmarking is a way to go backstage and watch another companys performance from the wings, where all stage tricks and hurried realignments are visible. Levels of Benchmarking There are three levels of benchmarking: 1. Internal benchmarking (within the company) 2. Competitive or strategic benchmarking (Industry and competitors) 3. Benchmarking outside the industry.

What benefits have been achieved by the organizations that have successfully completed their benchmarking programs? There are three sets of benefits:

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1. Cultural Change 2. Performance Improvement 3. Human Resources 1. Cultural Change: Benchmarking allows organizations to set realistic, rigorous new performance targets, and this process helps convince people of the credibility of these targets. It helps people to understand that there are other organizations who know and do job better than their own organization. 2. Performance Improvement: Benchmarking allows the organization to define specific gaps in performance and to select the processes to improve. These gaps provide objectives and action plans for improvement at all levels of organization and promote improved performance for individual and group participants. 3. Human Resources: Benchmarking provides basis for training. Employees begin to see gap between what they are doing and what best-in-class are doing. Closing the gap points out the need of personnel to be trained to learn techniques of problem solving and process improvement.

Marketing research process

From Wikipedia, the free encyclopedia Marketing research process is a set of six steps which defines the tasks to be accomplished in conducting a marketing research study. These include problem definition, developing an approach to problem, research design formulation, field work, data preparation and analysis, and report generation and presentation. [1]

Contents
[hide]

1 Stages of marketing research process 2 Secondary data analysis 3 Qualitative research 4 References 5 Further reading

[edit] Stages of marketing research process

Step 1: Problem Definition
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The first step in any marketing research project is to define the problem. In defining the problem, the researcher should take into account the purpose of the study, the relevant background information, what information is needed, and how it will be used in decision making. Problem definition involves discussion with the decision makers, interviews with industry experts, analysis of secondary data, and, perhaps, some qualitative research, such as focus groups. Once the problem has been precisely defined, the research can be designed and conducted properly.[2] Step 2: Development of an Approach to the Problem Development of an approach to the problem includes formulating an objective or theoretical framework, analytical models, research questions, hypotheses, and identifying characteristics or factors that can influence the research design. This process is guided by discussions with management and industry experts, case studies and simulations, analysis of secondary data, qualitative research and pragmatic considerations. [2] 'Step 3: Research Design Formulation' A research design is a framework or blueprint for conducting the marketing research project. It details the procedures necessary for obtaining the required information, and its purpose is to design a study that will test the hypotheses of interest, determine possible answers to the research questions, and provide the information needed for decision making. Conducting exploratory research, precisely defining the variables, and designing appropriate scales to measure them are also a part of the research design. The issue of how the data should be obtained from the respondents (for example, by conducting a survey or an experiment) must be addressed. It is also necessary to design a questionnaire and a sampling plan to select respondents for the study. More formally, formulating the research design involves the following steps [1]: 1. Secondary data analysis 2. Qualitative research 3. Methods of collecting quantitative data (survey, observation, and experimentation) 4. Definition of the information needed 5. Measurement and scaling procedures 6. Questionnaire design 7. Sampling process and sample size 8. Plan of data analysis Step 4: Field Work or Data Collection Data collection involves a field force or staff that operates either in the field, as in the case of personal interviewing (in-home, mall intercept, or computer-assisted personal interviewing), from an office by telephone (telephone or computer-assisted telephone interviewing), or through mail (traditional mail and mail panel surveys with prerecruited

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households). Proper selection, training, supervision, and evaluation of the field force helps minimize data-collection errors. Step 5: Data Preparation and Analysis Data preparation includes the editing, coding, transcription, and verification of data. Each questionnaire or observation form is inspected, or edited, and, if necessary, corrected. Number or letter codes are assigned to represent each response to each question in the questionnaire. The data from the questionnaires are transcribed or key-punched on to magnetic tape, or disks or input directly into the computer. Verification ensures that the data from the original questionnaires have been accurately transcribed, while data analysis, guided by the plan of data analysis, gives meaning to the data that have been collected. Univariate techniques are used for analyzing data when there is a single measurement of each element or unit in the sample, or, if there are several measurements of each element, each RCH variable is analyzed in isolation. On the other hand, multivariate techniques are used for analyzing data when there are two or more measurements on each element and the variables are analyzed simultaneously. [2] Step 6: Report Preparation and Presentation The entire project should be documented in a written report which addresses the specific research questions identified, describes the approach, the research design, data collection, and data analysis procedures adopted, and presents the results and the major findings. The findings should be presented in a comprehensible format so that they can be readily used in the decision making process. In addition, an oral presentation should be made to management using tables, figures, and graphs to enhance clarity and impact. [2] For these reasons, interviews with experts are more useful in conducting marketing research for industrial firms and for products of a technical nature, where it is relatively easy to identify and approach the experts. This method is also helpful in situations where little information is available from other sources, as in the case of radically new products.

What is QFD?
"Time was when a man could order a pair of shoes directly from the cobbler. By measuring the foot himself and personally handling all aspects of manufacturing, the cobbler could assure the customer would be satisfied," lamented Dr. Yoji Akao, one of the founders of QFD, in his private lectures.

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Quality Function Deployment (QFD) was developed to bring this personal interface to modern manufacturing and business. In today's industrial society, where the growing distance between producers and users is a concern, QFD links the needs of the customer (end user) with design, development, engineering, manufacturing, and service functions.

QFD is:

Understanding Customer Requirements Quality Systems Thinking + Psychology + Knowledge/Epistemology Maximizing Positive Quality That Adds Value Comprehensive Quality System for Customer Satisfaction Strategy to Stay Ahead of The Game

As a quality system that implements elements of Systems Thinking with elements of Psychology and Epistemology (knowledge), QFD provides a system of comprehensive development process for:

Understanding 'true' customer needs from the customer's perspective What 'value' means to the customer, from the customer's perspective Understanding how customers or end users become interested, choose, and are satisfied Analyzing how do we know the needs of the customer Deciding what features to include Determining what level of performance to deliver Intelligently linking the needs of the customer with design, development, engineering, manufacturing, and service functions Intelligently linking Design for Six Sigma (DFSS) with the front end Voice of Customer analysis and the entire design system

ISO 14000 is a family of standards related to environmental management that exists to help organizations (a) minimize how their operations (processes etc.) negatively affect the environment (i.e. cause adverse changes to air, water, or land); (b) comply with applicable laws, regulations, and other environmentally oriented requirements, and (c) continually improve in the above. ISO 14000 is similar to ISO 9000 quality management in that both pertain to the process of how a product is produced, rather than to the product itself. As with ISO 9000, certification is performed by third-party organizations rather than being awarded by ISO directly. The ISO 19011 audit standard applies when auditing for both 9000 and 14000 compliance at once.

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Development of the ISO 14000 series

The ISO 14000 family includes most notably the ISO 14001 standard, which represents the core set of standards used by organizations for designing and implementing an effective environmental management system. Other standards included in this series are ISO 14004, which gives additional guidelines for a good environmental management system, and more specialized standards dealing with specific aspects of environmental management. The major objective of the ISO 14000 series of norms is "to promote more effective and efficient environmental management in organizations and to provide useful and usable tools - ones that are cost effective, system-based, flexible and reflect the best organizations and the best organizational practices available for gathering, interpreting and communicating environmentally relevant information".[3] Unlike previous environmental regulations, which began with command and control approaches, later replaced with ones based on market mechanisms, ISO 14000 was based on a voluntary approach to environmental regulation (Szymanski & Tiwari 2004). The series includes the ISO 14001 standard, which provides guidelines for the establishment or improvement of an EMS. The standard shares many common traits with its predecessor ISO 9000, the international standard of quality management (Jackson 1997), which served as a model for its internal structure (National Academy Press 1999) and both can be implemented side by side. As with ISO 9000, ISO 14000 acts both as an internal management tool and as a way of demonstrating a companys environmental commitment to its customers and clients (Boiral 2007). Prior to the development of the ISO 14000 series, organizations voluntarily constructed their own EMS systems, but this made comparisons of environmental effects between companies difficult and therefore the universal ISO 14000 series was developed. An EMS is defined by ISO as: part of the overall management system, that includes organizational structure, planning activities, responsibilities, practices, procedures, processes and resources for developing, implementing, achieving and maintaining the environmental policy (ISO 1996 cited in Federal Facilities Council Report 1999).

Definition of 'Just In Time - JIT'

An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs. This method requires that producers are able to accurately forecast demand.

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Investopedia explains 'Just In Time - JIT'

A good example would be a car manufacturer that operates with very low inventory levels, relying on their supply chain to deliver the parts they need to build cars. The parts needed to manufacture the cars do not arrive before nor after they are needed, rather they arrive just as they are needed. This inventory supply system represents a shift away from the older "just in case" strategy where producers carried large inventories in case higher demand had to be met. Read more: http://www.investopedia.com/terms/j/jit.asp#ixzz1n8C4Tx4E

ust In Time (JIT) is a production and inventory control system in which materials are purchased and units are produced only as needed to meet actual customer demand. When Companies use Just in Time (JIT) manufacturing and inventory control system, they purchase materials and produce units only as needed to meet actual customers demand. In just in time manufacturing system inventories are reduced to the minimum and in some cases are zero. JIT approach can be used in both manufacturing and merchandising companies. It has the most profound effects, however, on the operations of manufacturing companies which maintain three class of inventories-raw material, Work in process, and finished goods. Traditionally, manufacturing companies have maintained large amounts of all three types of inventories to act as buffers so that operations can proceed smoothly even if there are unanticipated disruptions. Raw materials inventories provide insurance in case suppliers are late with deliveries. Work in process inventories are maintained in case a work station is unable to operate due to a breakdown or other reason. Finished goods inventories are maintained to accommodate unanticipated fluctuations in demand. While these inventories provide buffers against unforeseen events, they have a cost. In addition to the money tied up in the inventories, expert argue that the presence of inventories encourages inefficient and sloppy work, results in too many defects, and dramatically increase the amount of time required to complete a product.

Just-In-Time Concept:
Under ideal conditions a company operating at JIT manufacturing system would purchase only enough materials each day to meet that days needs. Moreover, the

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company would have no goods still in process at the end of the day, and all goods completed during the day would have been shipped immediately to customers. As this sequence suggests, "just-in-time" means that raw materials are received just in time to go into production, manufacturing parts are completed just in time to be assembled into products, and products are completed just in time to be shipped to customers. Although few companies have been able to reach this ideal, many companies have been able to reduce inventories only to a fraction of their previous level. The result has been a substantial reduction in ordering and warehousing costs, and much more efficient and effective operations. In a just in time environment, the flow of goods is controlled by a pull approach. The pull approach can be explained as follows. At the final assembly stage a signal is sent to the preceding work station as to the exact amount of parts and materials that would be needed over the next few hours to assemble products to fill customer orders, and only that amount of materials and parts is provided. The same signal is sent back to each preceding workstation so a smooth flow of parts and materials is maintained with no appreciable inventory buildup at any point. Thus all workstations respond to the pull exerted by the final assembly stage, which in turn respond to customer orders. As one worker explained, "Under just in time system you don't produce any thing, any where, for any body unless they ask for it some where downstream. Inventories are evil that we are taught to avoid".

Just-in-time is an inventory system where raw materials are delivered right before they are needed on the assembly line, and finished goods are manufactured just before they are shipped to customers. Just-in-time improves return on investment by substantially reducing overhead cost, limiting quality inspections, and eliminating obsolete inventory. Just-in-time does generate substantial risk, however: under just-in-time systems, production stops when parts aren't delivered on schedule, and huge bottlenecks are created when product isn't shipped on schedule. Thus successful just-in-time manufacturing requires both superior management and a highly disciplined workforce. Just-in-time is closely associated with methods introduced and refined by the Toyota Motor Company of Japan and copied by manufacturers throughout the world. In truth, however, just-in-time is simply one element of the comprehensive Toyota Production System, which attempts to eradicate waste of all kind.

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