BA 160 Chapter I
BA 160 Chapter I
Unit Objectives:
At the end of the Unit, the students would be able to:
1. understand the meaning, nature and philosophy of total quality
management;
2. explain the basic principles and concepts of quality;
3. enumerate the components and elements of TQM;
4. differentiate modern TQM from traditional management
5. appreciate the benefits and identify the obstacles in implementing
TQM; and
6. relate the knowledge of TQM to present issues and concerns
Total quality management, now a well known idea, is a
philosophy of management for continuously improving the
quality of products and processes. The idea is that the quality
of products and processes is the responsibility of everyone who
is involved with the development and/or use of the products or
services. TQM involves management, workforce, suppliers, and
even customers, in order to meet or exceed customer
expectations.
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What if jetliners crashed as
often as Microsoft Windows?
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Everyone has had
experiences of poor quality
when dealing with business
organizations.
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The consequences of poor
quality products and services
are lost customers and
opportunities for competitors
to take advantage of the
market need. Chapter 1
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“Successful companies
understand the powerful
impact of providing
quality products &
services to customers
can have on business”
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• Clients & users expect
quality
Why is • Poor quality results in
quality “rework” at additional cost
• Poor quality results in
important? problems that can be
difficult to diagnose and
solve
• Poor quality can cost lives
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Total – involvement of all
levels in an organization
Quality – degree of excellence
and conformance to agreed
requirements
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Total Quality
Management isa
leadership and management
philosophy, processes,
and guiding principles
stressing continuous
improvement through
people involvement and
qualitative methods
focusing on total
customer satisfaction.
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• a management approach for an organization,
centered on quality, based on the
participation of all its members and aiming at
long-term success through customer
satisfaction and benefits to all members of
the organization and to society.” (Royse, D.,
Thyer, B., Pageatt D., & Logan, T., 2006).
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• Is the management of total quality. Total
quality refers to 3 qualities namely:
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• TQM is not a program
• TQM is not a management fad
• TQM is not only about a
product or service quality
• TQM is only a means to an
organizational end
• TQM should never be the focus
of an organization
• It is one of the means to
achieve the focus of the
organization.
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There are two key philosophies in this approach.
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1. A committed and involved management to provide long-term
top to bottom organizational support.
2. An unwavering focus on the customer, both internally and
externally.
3. Effective involvement and the utilization of the entire work
force.
4. Continuous improvement of the business and production
process.
5. Treating suppliers as partners.
6. Establish performance measure for the processes.
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1. Perfection
2. Consistency
3. Eliminating Waste
4. Speed of delivery
5. Compliance with policies
and procedures
6. Providing a good, usable
product
7. Doing it right the first
time
8. Delighting or pleasing the
customer
9. Total customer service &
satisfaction
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1. satisfying the customer – 1st basic
principle. Meeting and exceeding
customer expectations
2. Satisfying the supplier – 2nd basic
principle – satisfying supplier to
continue business -
3. Continuous improvement – problem-
based. Attempt to fix them quickly is a
cost-efficient way.
4. Management commitment
5. Employee empowerment
6. Customer focus
7. Fact-based decision making
8. More continuous improvement
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Approach Management Led
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1. Quality can and must be managed
2. Processes, not people, are the problem
3. Don’t treat symptoms, look for the cure
4. Every employee is responsible for quality
5. Quality must be measurable
6. Quality improvements must be continuous
7. Quality is a long-term investment
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1. continual improvement
2. competitive benchmarking
3. employee empowerment
4. team approach
5. decision based on facts rather than
opinions
6. knowledge of tools
7. suppliers quality
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TQM Differentiated from Traditional Management Styles
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1. Ensures quality in a company’s
products and services
2. For customer satisfaction
3. Increase revenues
4. Reduce wastes
5. Induces teamwork
6. Encourages innovation
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Once an organization embarks on TQM, there will
be obstacles to its successful implementation.
The eight most common obstacles were determined
by Robert J. Masters after an extensive
literature search. These are:
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Quality Control Costs Quality Failure Costs
•
A. Clients &
users expect
quality
B. Poor quality
Why is results in
“rework” at
quality additional
important? cost
C. Poor quality
results in
problems that
can be
difficult to
diagnose and
solve
1. Increase productivity
2. expand market share
3. raise customer loyalty
4. Enhance
competitiveness of the
firm
5. at a minimum, serve as
a price of entry
A. Product Quality
Prevention Costs
Appraisal Costs
Process costs
costs expended to make sure productive
process conforms to quality
specifications
Training costs
• costs of developing
and putting on quality
training programs for
employees and
management
Information costs
costs of acquiring and
maintaining data related to
quality, and development of
reports on quality
performance
• Inspection and testing
• costs of testing and inspecting materials,
parts, and product at various stages and at
the end of a process
• Test equipment costs
• costs of maintaining equipment used in testing
quality characteristics of products
• Operator costs
• costs of time spent by operators to gar data
for testing product quality, to make equipment
adjustments to maintain quality, and to stop
work to assess quality
cost consequences of
poor quality