Introduction
Case studies
Streamlining TQM
Michael P. Cassidy
The author
Michael P. Cassidy is Quality Director, Power Systems,
Lucent Technologies, Mesquite, Texas, USA.
Abstract
Notes that many companies have abandoned total quality
management (TQM) implementation efforts and that a few
have even dismantled TQM after winning major quality
awards. Points out that this is generally blamed on
changes in top management, financial pressures or the
bureaucracy of TQM. Focuses on Lucent Technologies’
Power Systems business, which has avoided these prob-
lems by dramatically streamlining its award winning TQM
system and making it the key management tool for
meeting its next major business challenge. Describes the
process used to evaluate the existing TQM system and to
create the streamlined approach, the new streamlined
TQM system, and the results obtained to date.
The TQM Magazine
Volume 8 · Number 4 · 1996 · pp. 24–28
© MCB University Press · ISSN 0954-478X
24
Nearly every major organization around the
world[1] believes that quality is a critical
factor in its strategic performance. Due to
this, many have attempted to implement
TQM in at least part of their organization.
However, despite this enormous worldwide
effort many others have abandoned TQM.
One author[2] suggests that fully 95 per cent
of TQM implementation efforts fail. There
have already been several famous withdrawals
from TQM by companies which have won the
Deming Prize or a Baldrige award[3]. Typi-
cally these withdrawals are blamed on changes
in top executives, financial pressures, the
over-focus on process to the detriment of
business results, cultural mismatches, or the
bloated bureaucracy supposedly required by
TQM.
The Power Systems division of Lucent
Technologies, then known as AT&T, avoided
these problems during the implementation of
TQM. With a long heritage of involvement in
quality, we adapted the Japanese style TQM
to a US manufacturing company. The TQM
department never grew to more than a dozen
people and we focused our TQM efforts on
those processes that were truly critical to our
customers, our employees, and our busi-
ness[4]. In 1995, however, we faced many of
the same issues as those companies who had
previously abandoned TQM: a highly com-
petitive marketplace, a changing corporate
structure, a new top executive, and the natur-
al human let-down following the enormous
efforts required to win the Deming Prize in
1994. However, rather than abandoning the
award winning TQM system, the new chief
operating officer called on the entire organiza-
tion to put the TQM system to work. The
goal was to use TQM as the management
system to double the sales in a very short time.
The small TQM organization was chartered
with streamlining the already lean TQM
system. Their goal was to make the system so
easy to use that no one would have any excuse
not to use it on a daily basis.
The streamlining process
The existing TQM system was similar to
others used by leading TQM practitioners
around the world. It was based on three
This paper was first presented at the 1st Interna-
tional Conference on ISO 9000 and TQM, 10-12
April 1996, Leicester Business School, UK.
 Streamlining TQM
Michael P. Cassidy
primary elements: policy deployment, daily
work management and quality improvement.
Policy deployment is the element of TQM
that aligns the organization around the most
important activities to the business. It helps
establish the direction, priorities, and plans
for the business. Daily work management is a
system for documenting the specific processes
involved with a particular job, organization or
function as well as the plans for managing and
improving that particular operation. Quality
improvement is of course a collection of tools
used to effect improvement such as the seven-
step QI (quality improvement) story, sugges-
tions, and Poka-Yoke devices. A collection of
forms helped provide a disciplined documen-
tation approach. TQM forms 1-5 document-
ed the mission, vision, accountabilities, spe-
cific targets and current results for a given
function or manager and the relationship of
each individual’s accountabilities to those of
his manager and the business as a whole.
Forms TQM 6-8 documented the process
flow diagram, the managing and checking
points, and the specific improvement plans for
a particular area. TQM 9 was required for
policy deployment metrics that were missing
the established target and described the cor-
rective action plan. TQM 10 provided docu-
mented change control for the other forms. In
addition, each individual had a separate form
for use in reviewing their performance with
their supervisor. The entire process for each
major function was reviewed twice a year by
the chief operating officer in a presidential
review. The results on the managing points for
each major function were reviewed every
other month at an operational review. Also
each individual function was reviewed in
depth in a process modelled after the Deming
Prize schedule B examination by the quality
director several times a year.
The existing system was evaluated by the
TQM group. They reviewed their own experi-
ence in using it and gathered feedback from a
broad cross section of users throughout the
business. These experiences, plus an assess-
ment of the absolute requirements of a lean
TQM system led to the new streamlined
system now in place.
A streamlined TQM system must provide
for identification of the customer, identifica-
tion of the most important areas for improve-
ment, involvement of all levels in planning
improvements, aligning of the efforts of the
organization, linking of the improvement
efforts to the most important needs of the
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The TQM Magazine
Volume 8 · Number 4 · 1996 · 24–28
customer and the business, assurance of
meeting particular needs on a daily basis and
feedback to each individual employee so that
they can improve their ability to contribute to
the business in the future. Feedback from the
users indicated that some of the information
on the forms was redundant, and that they
were in general, too complicated. Many of the
users did not feel comfortable with the rela-
tionship matrices that used symbols to denote
the degree of relationship of individuals’
managing points with those of their supervi-
sor.
Streamlined TQM system
The new, streamlined system contains all of
the elements of the old existing system but
with reduced bureaucracy, reviews and paper-
work. Five forms are at the heart of the
streamlined TQM system. Completion of the
forms guides each individual and organization
through the thought process of clearly identi-
fying their customers, their areas of account-
ability, their linkage to the overall goals of the
business, the processes they use, and their
plans for improvement. Also integrated into
the TQM system are the feedback process for
helping each individual improve, the manage-
ment review process and the quality improve-
ment tools.
The first form is used to identify the mis-
sion, accountabilities and measures for a
particular organization. This form (TQM 1)
is used by Power Systems, the individual
business units, functions, departments and
shopfloor teams. An example of TQM 1
is shown in Figure 1 for the quality and
Figure 1 An example of TQM 1 for the quality and information technology
organization
Lu c e n t Te c h n o l o g i e s Po w e r Sy s t e ms
TQ M 1
A c c o u n t a b i l i t i e s & M e a su r e s
Organization: Quality and IT
Mission
To p r o v i d e l e a d e r s h i p f o r q u a l i t y i m p r o v e m e n t a c t i v i t i e s ; t o c r e a t e ,
assure, implement, and monitor an integrated quality approach; to act
as an independent customer advocate and to provide Information
Te c h n o l o g y s u p p o r t t o a l l o f P o w e r S y s t e m s
Accountabilities Measures
C u st o m e r S a t i sf a c t i o n
R e p r e s e n t t h e c u s t o me r ’ s i n t e r e s t w i t h i n Po w e r Report Card – Quality
Systems with respect to quality, reliability product OOBQ
safety and product qualification D PH
Pr o d u c t R e l i a b i l i t y
C y c l e Ti me R e d u c t i o n
O A SI S mi l e s t o n e s c o mp l e t e d
TQ M R e v i e w sc o r e
Products shipped not qualified
S t a k e h o l d e r S a t i sf a c t i o n
Pr o v i d e a n e ff e c t i v e , i n t e g r a t e d q u a l i t y Budget
a p p r o a c h t o me e t st a k e h o l d e r n e e d s PI P $ s a v i n g s
Em p l o y e e S a t i sf a c t i o n
C r e a t e a n e n v i r o n me n t w h e r e e mp l o y e e PVA – employee survey score
p a r t i c i p a t i o n i s e n c o u r a g e d a n d e v e r y e mp l o y e e
feels empowered to contribute to Power Systems
success
 Streamlining TQM The TQM Magazine
Michael P. Cassidy Volume 8 · Number 4 · 1996 · 24–28

information technology organization. As more specific measures which support these

expected, many of the measures are in the overall ones.
area of customer satisfaction. Specific depart- Organizations and individuals also want to
ments in the organization, for example Quali- know how their accountabilities align with
ty Assurance or Quality Engineering have those of their supervisor and the business.

Figure 2 A portion of TQM 2 for the chief operating officer with instructions for filling out the form

7 Enter the previous year‘s

results corresponding to the
managing point

5 Enter managing points of 6 The chief operating

officer‘s managing points 8 Enter the
appropriate personnel as they current target
correspond to entries of step 5 will be pre-entered
(see step 10) corresponding
to the managing
point

Chief Chief Results/targets

operating operating Managing points/ owner
Managing point Previous
officer officer description Current
managing checking year‘s
MFO MPC PBJ JDS JCW KMM LVS RHH WB SC results target
points points

C1.1 M1.1 CVA

C1.2 M1.2 Product quality

CVA C1.3 M1.3 Product reliability

M1
C1.4 M1.4 Ship to request

C1.5 M1.5 Cycle time reduction

C1.6 M1.6 Percentage schedules missed

C2.1 M2.1 PVA

CVA C2.2 M2.2 Safety

M1
C2.3 M2.3 Absenteeism

C2.4 M2.4 Community involvement

C3.1 M3.1 MOI

C3.2 M3.2 Cost reduction
EVA
M3
C3.3 M3.3 Assets

C4.1 M4.1 Revenue

Revenue C4.2 M4.2 Client share
M4 C4.3 M4.3 Globalization

4 The chief operating Owner Ext. Prepared by: Ext. Date Revision
officer‘s managing checking
points will be pre-entered
(see step 10)

9 Complete this section

each time
TQM 5 is updated

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 Streamlining TQM The TQM Magazine
Michael P. Cassidy Volume 8 · Number 4 · 1996 · 24–28

A critical step in policy deployment is achiev-
ing this alignment throughout the business.
This alignment is shown on TQM 2 along
with the current, approved target for each
measure. A portion of a TQM 2 for the chief
operating officer is shown in Figure 2. Also
shown are the instructions for filling out the
form from the TQM Planning Guide. This
guide is provided to everyone in Power Sys-
tems and is used in training people about the
TQM system.
Each process used throughout the business
is documented in a QA process flow diagram.
The flow diagram (Figure 3) and correspond-
ing managing and checking points for the
process are documented in TQM 3. Most of
Figure 3 A portion of TQM 3 for the statistical process control teams’
improvement of in-process quality
SPC training and operator verification
Collect data
Analyse data
our processes had these diagrams as part of
our ISO 9001 process. With the implemen-
tation of TQM, every process, whether associ-
ated with products, customers or internal
operations, has been documented in this
fashion.
Each priority managing point identified by
policy deployment as well as any other accou-
ntability slated for improvement needs a plan
to drive that improvement. A tool for that
planning is shown in Table I, which shows
part of the quality engineering TQM 4 for
improving the in-process quality in two shops
of the Systems business unit. Each action step
has identified the individual who is responsible
for the work, when it will be done and what
improvement in defects per hundred (DPH)
can be expected. The combination of all of
the TQM 4 forms for all of the shops predicts
the overall improvement expected in DPH
across the entire business.
Each employee has a Performance Man-
agement Worksheet that links to the TQM 1
and 2, provides documented feedback from
his supervisor and the opportunity to create
development plans for improving skills or
obtaining new assignments as shown in
Table II.

Any No Results and conclusions

out-of-control
points? The number of forms required to conduct
Report in-process policy deployment and daily work manage-
quality M1.2.6
defects per hundred ment was reduced by half. Performance
management was integrated into the TQM
Yes
system. The simplification of the system
Investigate root causes reduced the need for management reviews to
ensure compliance. The revamped manage-
Report process ment review system resulted in half as many
Develop and implement
control data corrective actions reviews while maintaining complete coverage
for DQR
of all policy deployment managing points and
all functions. For example, the presidential

Table I A portion of TQM 4 showing a typical improvement plan

Managing Start End Impact

point Target Actual Gap Action steps Who date date (% or actual)
(Systems – 2.9 3.6 0.7 Add templates and colour ROA/ 1/96 12/96 0.7 DPH
Ckt. Pk. – visuals for radial BH
Units and 2.0 2.2 0.2 Move PA parts to MI RM 1/96 9/96 0.2 DPH
frames) 9.8 10.6 0.8 New conveyor chains and
palletized cards LH 7/96 12/96 0.8 DPH
4.4 5.0 0.6 Test limit analysis GB/GL 1/96 11/96 0.6 DPH
0.1 Test fixture repair process
and diagnostic training GB 1/96 9/96 0.1 DPH
Total 18.9 21.3 2.4 2.4 DPH
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 Streamlining TQM The TQM Magazine
Michael P. Cassidy Volume 8 · Number 4 · 1996 · 24–28

Table II Assignment portion of TQM 5 for the quality director

Individual and team-based Linkage to business unit

performance objectives and organizational goals Measurements/managing points
Provide leadership in TQM and quality See TQM 2 Supervisory judgement based on feedback
improvement to all Power Systems from QC, other managers and customers
Facilitate major change process as Plus measurements shown on TQM 2 and
needed in Power Systems in particular completion of plans shown on TQM4
PRP improvement and implementation
of customer intimacy
Serve as customer advocate especially
on quality issues
Provide management leadership and
supervision to quality organization to
grow it and subordinates into world-
class quality group and enhance Power
Systems management resources
See mission and other accountabilities
on TQM 1 and 2

reviews are now only held once a year to
complete the goal setting process and to
ensure alignment of the entire business.
The end result is that 1995 was an extraor-
dinary year for Power Systems with most
indicators showing continued improvement,
the best financial results ever, accelerated
revenue growth, and increased employee
satisfaction with the system. The completion
of the total system plans was faster than ever
before in 1996. Nearly every group indicated
that the ease in understanding the purpose of
each part of the system and in completing the
forms had made the new streamlined system a
much higher value adding process to their
organization.
References
1 American Quality Foundation and Ernst & Young,
International Quality Study, Ernst & Young, Cleveland,
OH, 1991, p. 4.
2 D’Angola, L., Electronic Business, October 1992, p. 48.
3 “The cracks in quality”, The Economist, 18 April 1992,
p. 67.
4 Cassidy, M.P. and Sharma, S.P., “1990s revolution in
Power Systems Manufacturing”, Proceedings of the
Applied Power Electronics Conference, Boston, MA,
25 February 1992.

Commentary
Lessons from one of the world’s successful organizations are always worth noting – and how refreshing to
hear a senior executive being realistic about something as prestigious and powerful as the Deming Prize
– a great story of a firm who leveraged their efforts after winning the Deming Prize rather than sat back
and smirked about how smart they were!
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