Date: 11-03-2011

ASSIGNMENT: TOTOAL QUALITY

MANAGEMENT

Topic:

 5 QUALITY GURU’S AND THEIR CONTRIBUTION.

 QUALITY POLICY, REASONS FOR SUCCESS, SCOPE OF IMPROVEMENT AND
SUGGESTIONS OF HDFC BANK.

Submitted by:

Mohammed Shareef M.K

Roll No: 082600192

Section A

3rd year BBM (e-banking &finance)

 INTRODUCTION

            Total quality management is considered as a management approach that

was first used during the 1950’s and has become popular during the early of

1980’s. Total quality is considered as a total description of the culture, attitude as

well as the organization of the company that is in focus of providing their

customers with their products or services that will meet the demands and

preferences of their customers. Furthermore, the culture requires quality in all

aspects of the company’s operations, with the different processes that are being

done right the first time and defects as well as the waste eradicated from the

different operations.

            TQM is a method that is used where in the management as well as the

employees are all involved in their continuous improvement of the production of

goods as well as services. It can also be considered as the combination of quality as

well as the different management tools that focus at the increasing the growth of

the business as well as reducing the losses that was caused by different

unimportant or useless practices

 FIVE QUALITY GURU’S:

Philip Crosby – “Zero Defects” and “Right

First Time”

Philip Crosby is an American who promoted the phrases “zero defects” and “right

first time”. “Zero defects” doesn’t mean mistakes never happen, rather that there is

no allowable number of errors built into a product or process and that you get it

right first time.

Philip Crosby believes management should take prime responsibility for quality,

and workers only follow their managers’ example. He defined the Four Absolutes

of Quality Management.

The Four Absolutes of Quality Management

1. Quality is conformance to requirements

2. Quality prevention is preferable to quality inspection

3. Zero defects is the quality performance standard

4. Quality is measured in monetary terms – the price of non-conformance.

Crosby's 14 Steps to Quality Improvement

1. Management is committed to quality – and this is clear to all

2. Create quality improvement teams – with (senior) representatives from all

departments.

3. Measure processes to determine current and potential quality issues.

4. Calculate the cost of (poor) quality

5. Raise quality awareness of all employees

6. Take action to correct quality issues

7. Monitor progress of quality improvement – establish a zero defects

committee.

8. Train supervisors in quality improvement

9. Hold “zero defects” days

10.Encourage employees to create their own quality improvement goals

11.Encourage employee communication with management about obstacles to

quality

12.Recognize participants’ effort

13.Create quality councils

14.Do it all over again – quality improvement does not end

Five characteristics of an “Eternally Successful Organization”

1. People routinely do things right first time

2. Change is anticipated and used to advantage

3. Growth is consistent and profitable

4. New products and services appear when needed

5. Everyone is happy to work there

 Dr Kaoru Ishikawa (1915 – 1989)

Dr Kaoru Ishikawa, amongst other things, gave his name to the Ishikawa

diagram. The Ishikawa diagram is also known as the “fishbone diagram” or

“cause and effect diagram” and is a problem-solving tool used in Quality Circles.

Kaoru Ishikawa received many esteemed quality awards including the Deming

Prize. He led the “Total Quality Control” movement with focus on statistical

quality control techniques such as control charts and Pareto charts.

Quality Circles

Kaoru Ishikawa led the concept and use of Quality Circles. The intended purpose

of a Quality Circle is to;

 Support the improvement and development of the company

 Respect human relations in the workplace and increase job satisfaction

 Draw out employee potential

He believed quality must be company wide – including the product, service,

management, the company itself and the people. Quality improvement must be

company wide in order to be successful and sustainable.

Many, including Juran and Crosby, consider Kaoru Ishikawa’s teachings to be

more successful in Japan than in the West. Quality circles are effective when

management understand statistical quality management techniques and

are committed to act on their recommendations.

Genichi Taguchi - Quality Loss Function and

Robust Design

Genichi Taguchi is a Japanese quality expert, known for the Quality Loss Function

and for methodologies to optimize quality at the design stage – “robust design”.

Taguchi received formal recognition for his work including Deming Prizes and

Awards.

Genichi Taguchi considers quality loss all the way through to the customer,

including cost of scrap, rework, downtime, warranty claims and ultimately reduced

market share.

Genichi Taguchi's Quality Loss Function

The Quality Loss Function gives a financial value for customers'

increasing dissatisfaction as the product performance goes below the desired target

performance. 

Equally, it gives a financial value for increasing costs as product performance goes

above the desired target performance. Determining the target performance is an

educated guess, often based on customer surveys and feedback.

The quality loss function allows financial decisions to be made at the design

stage regarding the cost of achieving the target performance.

Quality through Robust Design Methodology

Taguchi methods emphasized quality through robust design, not quality through

inspection. Taguchi breaks the design process into three stages:

1. System design - involves creating a working prototype

2. Parameter design - involves experimenting to find which factors influence

product performance most

3. Tolerance design - involves setting tight tolerance limits for the critical

factors and looser tolerance limits for less important factors.

Taguchi’s Robust Design methodologies allow the designer through experiments to

determine which factors most affect product performance and which factors are

unimportant. 

The designer can focus on reducing variation on the important or critical factors.

Unimportant or uncontrollable “noise” factors have negligible impact on the

product performance and can be ignored.

Robust Design of Cookies

This is easier explained by example. If your business makes cookies from raw

ingredients, there are many possible factors that could influence the quality of the

cookie - amount of flour, number of eggs, temperature of butter, heat of oven,

cooking time, baking tray material etc.

With Genichi Taguchi’s Robust Design methodologies you would set up

experiments that would test a range of combinations of factors - for example, high

and low oven temperature, with long and short cooking time, 1 or 2 eggs, etc. The

cookies resulting from each of these trials would be assessed for quality.

A statistical analysis of results would tell you which the most important factors are,

for example oven temperature affects cookie quality more than the number of

eggs. 

With this knowledge you would design a process that ensures the oven maintains

the optimal temperature and you would be able to consistently produce good

cookies.
 Shigeo Shingo - Poka yoke, source inspection,

mistake proofing and SMED (1919 – 1990)

Shigeo Shingo’s work is better known than his name. His work includes; Poka

yoke, source inspection, mistake proofing, SMED (single minute exchange of die)

and contribution to Just In Time (JIT) production.

Shigeo Shingo's quality teachings were successful as they were practical and action

oriented.

Poka Yoke

“Poka yoke” is about stopping processes as soon as a defect occurs, identifying

the defect source and preventing it from happening again. Statistical quality

inspection will ultimately no longer be required, as there will be no defects to

detect – “zero defects”.

Poka yoke relies on source inspection, detecting defects before they affect the

production line and working to eliminate the defect cause.

Mistake Proofing

Mistake proofing is also a component of poka yoke. Shingo introduced simple

devices that make it impossible to fit a part incorrectly or make it obvious when

a part is missing. This means that errors are prevented at source, supporting a zero

defects process.

SMED (single minute exchange of die)

Shigeo Shingo developed SMED (single minute exchange of die) techniques

for quick changeovers between products. By simplifying materials, machinery,

processes and skills, changeover times could be reduced from hours to minutes. 

Quick changeovers meant products could be produced in small batches or even

single units, with minimal disruption. This enabled Just In Time production, as

pioneered by the Toyota company.

Just in Time Production

Just In Time production is about supplying the customer with what they want,

exactly when they want it. Traditional manufacturing tended to large batch

production as this gave economies of scale, however required large inventories of

raw materials and finished goods. Orders are “pushed” through the system.

The aim of Just In Time is to minimise inventories by only producing what is

required, when it is required. Orders are “pulled” through the system, triggered by

a customer order. This reduces costs and waste throughout the production process.

In summary, Shigeo Shingo focused on practical differences that made immediate

differences, rather than theory.

 Tom Peters

Tom Peters is a hugely successful management guru, considered by some to be

the gurus' guru. Peters best known book “In Search of Excellence”, co-authored

with Robert Waterman, presents 8 common themes of successful corporations:

1. A bias for action - getting on with it.

2. Close to the customer - learning from the customer.

3. Autonomy and entrepreneurship.

4. Productivity through people.

5. Hands-on, value-driven - management walk the talk.

6. Stick to the knitting – do what you know.

7. Simple form, lean staff.

8. Simultaneous loose-tight properties – have autonomy in some areas, central

ideas/values in others.

These themes were based on consultant company McKinsey’s 7-S model and from

analysis of 43 fortune-500 companies. Peters emphasizes the role of people,

customers and action and the need to move away fromTaylor-ist “bean-

counters”. 
QUALITY POLICY OF TOYOTA

Toyota Turkey is a TOYOTA's production base for European market including

Turkey. Our mission is to contribute to Turkish society through producing high
quality vehicles in Turkey.

Customers are seeking high quality vehicles with lower costs delivered to them in
the specifications they need and in time with their demands.

As customer satisfaction is our primary objective, and quality is the prerequisite for
that, it is our mandate to deliver what our customers demand and maintain our
competitiveness.

We have to accomplish this mission constructed on following principles:

 - Total Quality Control, based on mutual trust among ourselves and involvement
of every single member of our organization is our Company life style. We cannot
compromise for quality in anything we do.

 - We are committed to continuous improvement ( Kaizen ) in all our activities and

practices.

 - We shall cooperate with and assist our suppliers tro for continuous improvement
in their products, services and practices.

 - Our quality target is to be always better than competitors and also to be better
than other Toyota Motor Corporation plants, producing CS No. 1 vehicles.
REASONS FOR SUCCESS

Ford and Chevy dominated the market when Toyota , a virtually unknown
importer, opened its first American car dealership in California in 1957. More than
50 years later, Toyota is now the world's biggest carmaker, earning top marks from
experts and customers alike for quality and innovation. U.S. News asked David
Magee, author of How Toyota Became # 1 , to highlight some of the reasons
for Toyota's success:

Long-term planning. Instead of responding to trends, fads, and quarterly

numbers, Toyota looks far down the road and tries to develop products that will
resonate for a long time. The best example is the Prius hybrid—which debuted
eight years ago, when a gallon of gas in the United States cost a mere $1.50, and
the average car buyer cared more about cup holders than gas mileage. The iconic
hybrid, of course, turned out to be a breakthrough vehicle, and Toyota sold its 1
millionth Prius this month. With gas prices and fuel economy now a top concern,
the Prius has helped Toyota take a commanding lead in hybrid technology.
Studious speediness. Suppliers sometimes complain that Toyota takes forever to
make a decision. But that's usually because the company exhaustively researches
all its options, then makes sure all the major stakeholders agree on a course of
action. Once Toyota decides to build a car, however, the turbocharger kicks in:
Toyota can move a product to market faster than almost all of its competitors.

An open mind. Toyota learned many of its early lessons from Americans,

studying Ford Motor Co.'s production lines and the theories of management guru
W. Edwards Deming. That helped Toyota gain a foothold in the United States, the
world's biggest car market, even though the company was an outsider whose home
market of Japan was vastly different. Decades later, Toyota still shows a knack for
figuring out what customers want, sometimes predicting American tastes better
than the Detroit automakers that supposedly have home-field advantage.

Obsession with waste. Toyota's "continuous improvement" ethos is legendary

throughout industry, but Magee believes the real secret is a profound disdain for
inefficiency—whether it's wasted time, excess material, or a scrap of trash on a
factory floor. "At a lot of companies, if something's going well and it's profitable,
they'll move on to something else," Magee says. "But if Toyota can attach a hood
in eight minutes, they'll find a way to whittle that down to four minutes, then two
minutes, then who knows..."

Humility. Quick, name a famous Toyota executive. Can't? Well, here's why:

Toyota's company culture emphasizes teamwork over individual stars. "Toyota
executives don't see themselves as bigger than the company or the customer or the
product," Magee says. "It's the most humble company I've been in." At Toyota
factories, the plant manager doesn't even get a reserved parking space, a perk that
is practically universal among manufacturing companies
SCOPE OF IMPROVEMENT

TMS is currently documenting its contract management processes in

preparation to extend these across other Toyota business units.
Since deploying contract management to IT, procurement, Toyota
Financial Services, and NAPO, TMS has opened up the application
to Toyota Canada, and Toyota Motor Manufacturing North America
as well. The goal is to identify software and IT contracts and negotiate
volume discounts and service levels across Toyota’s businesses. Barton
expects that contract management will better support Toyota’s sourcing
strategies, portfolio management, and project prioritizations and
delivery goals. In short, standardizing and automating contract
management operations fosters the continuous improvement spirit
of Toyota’s kaizen culture.
SUGGESTIONS FOR IMPROVEMENT

Toyota has started a new way for improving their product and services by giving
the public to give opinions and suggestions for improvements. Some of them are
given below.

1. The brand image is meaningless. It is the consumer's image that matters. To

be a Toyota driver today is to display that you are willing to put children in
harm's way-your children, the children of friends, and strangers' children
too. People are abandoning Toyota because this display jeopardizes their
ability to belong in society. This is the real problem the company must
solve.

2. Electricity generated from coal or oil will not make electric cars
environment friendly - the dirt is produced elswhere. But it will help big
cities to promote clean air. So think about the best size, price and range for a
popular car for all those big cities.

3. I think the main issue for Toyota is the perception that quality has suffered
over the years, as Toyota has banked on its reputation while relentlessly
cutting costs and doing away with whatever they can - which has resulted in
a product which just isn't as good, and won't last as long, as older models.
Many recent buyers complain that the fit and finish are not what they
expected, and of course the safety issues cannot be minimized. This is an
exercise beyond 'get-back-to-basics' and involves value for money and
paying more attention to what is important to consumers, in an era of
 increasing competition not just from other Asian makes but also the
resurgent Ford and European manufacturers. They need to reevaluate the
brand promise and what they're willing to give up in terms of profits to
restore their reputation in the US with middle class new car buyers

4. There is a rapidly growing electric car market. Their major weakness is

range anxiety. But not having to carry around a fuel tank and engine of a
hybrid is a benefit as well as a liability.

5. The brake pedal should slow down and stop your cars.
The accelerator should speed it up when called upon.
Stick with the basics.