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UNIT- I
INTRODUCTION

Introduction - Need for quality - Evolution of quality - Definitions of quality - Dimensions of

product and service quality - Basic concepts of TQM - TQM Framework - Contributions of
Deming, Juran and Crosby - Barriers to TQM -- Customer focus - Customer orientation,
Customer satisfaction, Customer complaints, Customer retention.

INTRODUCTION
QUALITY DEFINITION
Quality does not mean an expensive product. In contrary it is fitness for use of the
product.
.
➢ A predictable degree of uniformity and dependability at low cost and suited to
market- W.Edwards Deming
➢ Development, manufacture, administration and distribution of consistently low cost
and products and services that customers need and want.-Bill Conway
➢ Quality is defined as being about value (Feigenbaum, 1983)
➢ Quality is conformance to standards, specifications or requirements (Crosby, 1979)
➢ Quality is fitness for use (Juran, 1989)
➢ Quality as excellence (Peters and Waterman, 1982)
➢ Quality is concerned with meeting or exceeding customer expectations
.(Parasuramanet al., 1985)
➢ Quality means delighting the customer (Peters, 1989)

CUSTOMERS DRIVEN QUALITY DEFINITION

Quality therefore can be described as:
“MEETING THE STATED AND IMPLIED NEEDS OF THE CUSTOMER”

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Quality can be quantified as follows:

Q = P/E
Where Q = Quality
P = Performance and
E = Expectations

If Q > 1 then the customer has a good feeling about the product or service. The
determination of P and E will be most likely based on perception with the organization
determining performance and the customer determining expectations.

NEED FOR QUALITY

• Competition – Today’s market demand high quality products at low cost. Having `high
quality’ reputation is not enough! Internal cost of maintaining the reputation should be
less.
• Changing customer – The new customer is not only commanding priority based on
volume but is more demanding about the “quality system.”
• Changing product mix – The shift from low volume, high price to high volume, low
price have resulted in a need to reduce the internal cost of poor quality.
• Product complexity – As systems have become more complex, the reliability
requirements for suppliers of components have become more stringent.
• Higher levels of customer satisfaction – Higher customers expectations are getting
spawned by increasing competition.
• The quality of your work defines you- Whoever you are, whatever you do, I can find
the same products and services cheaper somewhere else. But your quality is your
signature.

EVOLUTION OF QUALITY

The Evolution of Quality

Before the concepts and ideas of TQM were formalized, much work had taken place over
the centuries to reach this stage. This section charts the evolution, from inspection through to
the present day concepts of total quality.
From inspection to total quality
During the early days of manufacturing, an operative’s work was inspected and a
decision made whether to accept or reject it. As businesses became larger, so too did this role
and full time inspection jobs were created.
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Evolution

TQM
TQC
TQC
SQC
Inspection
Foreman
Craftsman
Years
1900 1920 1940 1960 1980 1990 2000

Inspection Salvage, sorting, grading, blending,

corrective actions, identify sources of non
-conformance
Develop quality manual, process
performance data, self inspection, product
Quality testing, basic quality planning, use of basic
control statistics, paper work control

Quality system development, advanced

Quality quality planning, comprehensive quality
Assurance manuals, use of quality cost, involvement
of non productive organization, FMEA,
Statistical process control

Policy deployment, involve supplier and

TQM customer, involve all operations, process
management, performance management,
teamwork, employee involvement.

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DIMENSIONS OF MANUFACTURING AND SERVICE QUALITY

DIMENSIONS OF QUALITY FOR PRODUCTS

The dimensions of quality primarily for manufactured products a consumer looks for in a
product include the following:

1. Performance: The basic operating characteristics of a product; for example, how well a
car handles or its gas mileage.
2. Reliability: The probability that a product will operate properly within an expected time
frame; that is, a TV without repair for about 7 years
3. Durability: How long the product lasts; its life span before replacement.
4. Serviceability: The ease of getting repairs, the speed of repairs, and the courtesy and
competence of the repair person.
5. Aesthetics: How a product looks, feels, sounds, smells, or tastes.
6. Features: The “extra” items added to the basic features, such as stereo CD or a leather
interior in a car
7. Perceived Quality: It is the customer’s perceptions of the overall quality of a product or
service with respect to its intended purpose relative to alternatives.
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8. Conformance to standards: The degree to which a product meets pre-established

standards.

DIMENSIONS OF QUALITY FOR SERVICE

The dimensions of quality for a service differ somewhat from those of a manufactured
product. Service quality is more directly related to time, and the interaction between employees
and the customer.
Evans and Lindsay identify the following dimensions of service quality.

➢ Time and timeliness

➢ Completeness
➢ Courtesy
➢ Consistency
➢ Accessibility and
convenience
➢ Accuracy:
➢ Responsiveness
➢ Competency/Expertise

1. Time and timeliness: How long a customer must wait for service, and if it is completed
in time. For example, is an overnight package delivered overnight?
2. Completeness: Is everything the customer asked for provided? For example, is a mail
order from a catalog company complete when delivered?
3. Courtesy: Cheerful service..How customers are treated by employees. For example, are
catalog phone operators nice and are their voices pleasant?
4. Consistency: Is the same level of service provided to each customer each time? Is your
newspaper delivered on time every morning?
5. Accessibility and convenience: How easy it is to obtain the service. For example, when
you call BPL Mobile, does the service representative answer quickly?
6. Accuracy: Is the service performed right every time? Is your bank or credit card
statement correct every month?
7. Responsiveness: How well the company reacts to unusual situations, which can happen
frequently in a service company. For example, how well a telephone operator at a catalog
company is able to respond to a customer’s questions about a catalog item not fully
described in the catalog.
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8. Competency/Expertise: In professions like doctors, lawyers, mechanics, etc.

BASIC CONCEPTS OF TQM

➢ Total Quality Total Quality Management (TQM) is an enhancement to the traditional way
of doing business. It is a proven technique to guarantee survival in world-class
competition.

➢ Only by changing the actions of management will the culture and actions of an entire
organization be transformed. TQM is for the most part common sense. Analyzing the
three words, we have:

Total : Make-up of the whole.

Quality : Degree of excellence a product or service provides to the customer in
present and future.
Management : Act, art, or manner of handling, controlling, directing, etc.

MANAGEMENT AND ITS IMPORTANCE

TQM Definition:

➢ "TQM is 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." BY ISO

➢ TQM is an integrated organizational approach in delighting customers (both internal and

external) by meeting their expectations on a continuous basis through every one
involved with the organization working on continuous improvement in all products,
services, and processes along with proper problem solving methodology - INDIAN
STATISTICAL INSTITUTE ( ISI )

➢ TQM is people - focused management system that aims at continual increase in

customer satisfaction at continually lower cost. TQM is a total system approach and an
integral part of high level strategy. It works horizontally across functions and
departments, involving all employees, top to bottom, and exceeds backwards and
forward to include the supply chain and the customer chain – TOTAL QUALITY
FORUM OF USA
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CHARACTERISTICS OF TQM :

1. TQM is a customer oriented.

2. TQM required a long term commitment for continuous improvement of all processes.
3. TQM is teamwork.
4. TQM requires the leadership of top management and continuous involvement.
5. TQM is a strategy for continuous improving performance at all levels and in all areas of
responsibility.

THE PRINCIPLES OF TOTAL QUALITY MANAGEMENT

1. Be Customer focused : Only customers determine the level of quality , whatever you do
to foster quality improvement , training employees, integrating quality into processes
management , ONLY customers determine whether your effort were worthwhile.

2. Insure Total Employee Involvement: This done after you removes fear from work place,
then empower employee ... you provide the proper environment\
.
3. Process Centered: Fundamental part of TQM is to focus on Process thinking
.
4. Integrated system: All employee must know business mission and vision, must monitor
the process .an integrated business system may be modeled by MBNQA or ISO 9000.

5. Strategic and systematic approach: Strategic plan must integrate quality as core
component/

6. Continual Improvement: using analytical and creative thinking in finding ways to

become more effective.

7. Fact Based Decision Making: decision making must be ONLY on data, not personal
thinking or situational.
8. Communication: communication strategy, method and timeliness must be well defined.

➢ Good product quality requires a consistent program of activities and policies that
combines people, technology, and processes within an institutional infrastructure that
provides the correct vision, organization, incentives, and support.

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➢ Total Quality Management (TQM) synthesizes the most important quality principles and
practices proposed by quality gurus. TQM addresses both the design and conformance
aspects of quality, and it provides a coherent approach that readily encompasses all the
relevant quality management principles and tools.

BASIC APPROACH/CONCEPTS OF TQM

A successful TQM programme requires the following six basic concepts.

1.Top management commitment

2.Focus on the customer
3. Effective involvement and utilization of the entire work force
4. Continuous improvement
5.Treating suppliers as partners
6. Establishing performance measures for the processes

1. Top Management Commitment: Top management should participate and completely

involve in the total quality programme. They should ensure their complete commitment
to the approach through management meetings, company magazines or newsletters. A
quality council must be established to develop a clear vision, set long-term goals, and
direct the program. Quality goals are included in the business plan.

2. Focus on the customer: Achieving customer satisfaction is the heart of TQM.

Customers include both internal and external customers. We must listen to the “voice of
the customer” and emphasize design quality and defect prevention. Do it right the first
time and every time, for customer satisfaction is the most important consideration.

3. Effective involvement and utilization of the entire work force: This concept is
sometimes referred as ‘principle of employee’s involvement’ or ‘respect for people’.
Total quality recognizes that each person is responsible for the quality of his work and for
the work of the group. All persons must be trained in TQM, Statistical Process Control
(SPC), and other appropriate quality improvement skills so that they can effectively
participate on quality teams.

4. Continuous improvement:: TQM believes that there is always a better way of doing
things, way to make better use of the company’s total quality resources, a way to be more
productive. For this purpose various quality tools and techniques may be used. Quality
improvement projects, such as on-time delivery, order entry efficiency, billing error rate,
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customer satisfaction, cycle time, scrap reduction, and supplier management, are good
places to begin. Technical techniques such as SPC, benchmarking, quality function
development, ISO 9000, and designed experiments are excellent for problem solving.

5. Treating suppliers as partners: Since the suppliers influence the company’s quality,
therefore a partnering relationship should be developed between the management and the
suppliers. Both parties have as much to gain or lose based on the success or failure of the
product or service. The focus should be on quality and life-cycle costs rather than price.
Suppliers should be few in number so that true partnering can occur.

6. Establishing performance measures for the processes: Quantitative data are necessary
to measure the continuous quality improvement activity. Therefore performance
measures such as uptime, productivity, sales turnover, absenteeism, percent non-
conforming, customer satisfaction, etc., should be determined for each functional area.
These results can be used for further improvement activities. TQM requires a cultural
change.

TQM FRAMEWORK:

➢ In the below figure shows the framework for the TQM system. It begins with the
knowledge provided by gurus of quality: Shewhart, Deming, Juran, Figenbaum,
Ishikawa, Crosby, and Taguchi.

➢ As the below figure shows, they contributed to the development of principles and
practices and/or the tools and techniques. Some of these tools and techniques are used in
the product and/or service realization activity.

➢ Feedback from internal/external customers or interested parties provides information to

continually improve the organization’s system, product and/or service.

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THE EIGHT ELEMENTS OF TQM

➢ Total Quality Management is a management approach that originated in the 1950's and
has steadily become more popular since the early 1980's.
➢ Total Quality is a description of the culture, attitude and organization of a company that
strives to provide customers with products and services that satisfy their needs.
➢ The culture requires quality in all aspects of the company's operations, with processes
being done right the first time and defects and waste eradicated from operations.
➢ To be successful implementing TQM, an organization must concentrate on the eight key
elements:
1. Ethics
2. Integrity
3. Trust
4. Training
5. Teamwork

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6. Leadership
7. Recognition
8. Communication
➢ TQM requires the help of those eight key elements. These elements can be divided into
four groups according to their function. The groups are:
I. Foundation - It includes: Ethics, Integrity and Trust.
II. Building Bricks - It includes: Training, Teamwork and
Leadership.
III. Binding Mortar - It includes: Communication.
IV. Roof - It includes: Recognition.

CONTRIBUTIONS OF DEMING, JURAN AND CROSBY

WHAT IS A QUALITY GURU?

➢ A guru, by definition, is a good person, a wise person and a teacher. A quality guru
should be all of these, plus have a concept and approach to quality within business that
has made a major and lasting impact.
➢ The gurus mentioned in this section have done, and continue to do, that, in some cases,
even after their death.

Quality Guru Main Contribution

Walter A. Shewhart –Contributed to understanding of process variability.
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–Developed concept of statistical control charts.

W. Edwards Deming –Stressed management’s responsibility for quality. –
Developed “14 Points” to guide companies in quality
improvement.
Joseph M. Juran –Defined quality as “fitness for use.” –Developed concept
of cost of quality.
Armand V. –Introduced concept of total quality control.
Feigenbaum
Philip B. Crosby –Coined phrase “quality is free.” –Introduced concept of
zero defects.
Kaoru Ishikawa –Developed cause-and-effect diagrams. –Identified
concept of “internal customer.”
Genichi Taguchi –Focused on product design quality. –Developed Taguchi
loss function.

1.DEMING’S CONTRIBUTION

DEMING’S PHILOSOPHY (14 POINTS)

William Edwards Deming (October 14, 1900–December 20, 1993) was an American
statistician, college professor, author, lecturer, and consultant. Deming is widely credited with
improving production in the United States during World War II, although he is perhaps best
known for his work in Japan.

Deming's business philosophy is summarized in his famous "14 Points," listed below. These
points have inspired significant changes among a number of leading US companies striving to
compete in the world's increasingly competitive environment.

1. Create constancy of purpose towards the improvement of product and service

2. Learn the new philosophy to meet the challenges.
3. Understand the purpose of inspection on a mass basis by building quality into the product
and service.
4. Stop awarding business based on price alone.
5. Improve constantly and forever the system of production and service.
6. Institute training on the job for the employees to understand the about the proper tools
and knowledge to do a good job.

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7. Teach leadership which help people to do a better job.

8. Drive out Fear, Create Trust and Create a climate for innovation.
9. Optimize the efforts of Teams, Groups and Staff areas.
10.Eliminate slogans, exhortations, and targets for the work force which ask for zero defects
and new levels of productivity
11.Eliminate numerical quotas for the work force.
12.Remove Barriers that rob people of pride of workmanship
13.Encourage Education and Self-improvement for everyone.
14.Take action to accomplish the transformation

SEVEN DEADLY DISEASES OF DEMING

In addition to the 14 points, Deming proposed “Seven Deadly Diseases (also known as the
"Seven Wastes")” that obstruct the quest for quality.
1. Lack of constancy of purpose
2. Emphasis on short-term profits
3. Evaluation by performance, merit rating, or annual review of performance. i.e., over
reliance on performance appraisal
4. Mobility of management
5. Running a company on visible figures alone. i.e., over emphasis on visible figures
6. Excessive medical costs
7. Excessive costs of warranty, fueled by lawyers who work for contingency fees.
Deming’s Wheel or Deming Cycle or PDCA cycle
The Deming Wheel or Deming Cycle which is also known as the PDCA Cycle is a problem
solving problems adopted by firms engaged in continuous improvement.
The cycle consists of the following steps:

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PDCA cycle was popularized by Dr. W. Edward’s Deming, is often considered as Father of
modern quality control.

Plan : Define the problem to be addressed, collect relevant data and analyze
the problem's root cause.
Do: Develop and implement a solution; decide upon a measurement to gauge its
effectiveness.
Check: Confirm the results through before-and-after data comparison.
Act: Document the results, inform others about process changes, and make
recommendations for the problem to be addressed in the next PDCA cycle.

II. JOSEPH JURAN’S CONTRIBUTION

Joseph M. Juran was born in December 1904 in Romania. Joseph M. Juran's major
contribution to the world has been in the field of quality management.
➢ Juran views quality as fitness for use.
➢ Juran Trilogy is designed to reduce the cost of quality over time.
JURAN’S TRILOGY:
1. QUALITY PLANNING:
➢ Determine internal and external customers.
➢ Their needs are discovered
➢ Develop product and service features.
➢ Develop the process to produce product and service
➢ Transfer plans to operations.
2. QUALITY CONTROLS
➢ Determine items to be controlled
➢ Set goals for the control
➢ Measure actual performance
➢ Compare actual performance to goal
➢ Act on the difference

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3. QUALITY IMPOROVEMENT
➢ Establishment of quality council.
➢ Identify the improvement projects.
➢ Establish the project teams with a project leader.
➢ Provide the team with the resources.
JURAN’S COST OF QUALITY
Juran classified cost of quality into three classes:
i. Failure costs – scrap, rework, corrective actions, warranty claims, customer
complaints, loss of customer
ii. Appraisal costs – Inspection, compliance auditing & investigation
iii. Prevention costs – training, preventive audit, & process improvement implementation

The Juran’s trilogy diagram which has time along the horizontal axis and cost of poor quality
(COPQ) along the vertical axis. The trilogy is constituted by three steps, namely, quality
planning, quality control and quality improvement.

JURAN’S QUALITY IMPROVEMENT (10 POINTS)

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1. Build awareness of the need & opportunity for improvement

2. Set goals for improvement
3. Organize to reach the goals
4. Provide training
5. Carry out projects to solve problems
6. Report progress
7. Give recognition
8. Communicate results
9. Keep score
10. Maintain momentum by maintaining annual improvement

III.PHILIP CROSBY CONTRIBUTIONS

✓ 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.

THE FOUR ABSOLUTES OF QUALITY MANAGEMENT

1. Quality means conformance to requirements, not goodness.

2. Quality is achieved by prevention, not appraisal.
3. Quality has a performance standard of Zero Defects, not acceptable quality levels.
4. Quality is measured by the Price of Nonconformance, not indexes.

CROSBY'S QUALITY IMPROVEMENT (14 POINTS)

1. Management commitment to quality improvement.

2. Quality improvement team with representatives from each department or function.
3. Quality measurement to determine the status of quality throughout the company.
4. Determine the cost of quality to discover where action to correct a defect will result in
greater profitability.
5. Quality awareness for all employees, about the cost of defects to the company.
6. Corrective action should become a habit.
7. Establish an committee for the Zero Defects Programme
8. Supervisor training.
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9. Zero Defects Day

10.Goal setting
11.Remove the causes of error.
12.Recognition
13.Quality Councils need to conduct regular meetings to discuss improvements.
14.Do it over again

THE CROSBY QUALITY VACCINE

✓ Integrity: Treat quality seriously throughout the whole business organization from
top to bottom. That the company’s future will be judged on its performance on
quality.

✓ Systems: Appropriate measures and systems should be put in place for quality costs,
education, quality, performance, review, improvement and customer satisfaction.

✓ Communication: The communication systems are of paramount importance to

communicate requirements and specifications and improvement opportunities around
the organization. Customers and operators know what needs to be put in place to
improve and listening to them will give you the edge.

✓ Operations: Work with and develop suppliers. Processes should be capable and
improvement culture should be the norm.

✓ Policies: Must be clear and consistent throughout the business.

BARRIERS OR OBSTACLES IN IMPLEMENTING TQM

Many organizations, especially small ones with a niche, are comfortable with their
current state. They are satisfied with the amount of work being performed, the profits realized,
and the perception that the customers are satisfied.

1. Lack of Management Commitment

2. Inability to Change Organizational Culture
3. Improper Planning
4. Lack of continuous Training and Education
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5. Incompatible Organizational Structure and Isolated Individuals and Departments

6. Ineffective Measurement Techniques and Lack of Access to Data and Results
7. Paying Inadequate Attention to Internal and External Customers
8. Inadequate Use of Empowerment and Teamwork
9. Failure to Continually Improve:

1. Lack of Management Commitment: Management does not allocate sufficient time and
resources for TQM implementation.

2. Inability to Change Organizational Culture: Even individuals resist change; changing

an Organization’s culture is much more difficult and may require as much as 5 years or
more.
.
3.Improper Planning: All constituents of the organization must be involved in the
development of the implementation plan and any modifications that occur as the plan
evolves.

4.Lack of continuous Training and Education: Training and education is an ongoing

process for everyone in the organization.

5. Incompatible Organizational Structure and Isolated Individuals and Departments:

Differences between departments and individuals can create implementation problems.

6.Ineffective Measurement Techniques and Lack of Access to Data and Results:

Effective decisions can be made to improve a process and need to measure the effect of
improvement ideas. Access to data and quick retrieval is necessary for effective process.

7. Paying Inadequate Attention to Internal and External Customers:

Organizations need to understand the changing needs and expectations of their customers.
Effective feedback mechanisms provide data for decision making are necessary for this
understanding.

8.Inadequate Use of Empowerment and Teamwork:

Teams need to have the proper training and team’s recommendations should be followed.
Individuals should be empowered to make decisions that affect the efficiency of their
process or the satisfaction of their customers.

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9. Failure to Continually Improve:

A lack of continuous improvement of the process, product, and or service will leads to
failure.

BENEFITS OF TQM

Tangible Benefits Intangible Benefits

Better product quality Effective team work
Productivity improvement Enhancement of job interest
Reduced quality costs Improvement in human relation and
Increased market work area morale
Increased profitability Participation culture
Reduced employee grievances Customer satisfaction
Enhanced problem solving capacity
Improved corporate health and
character of the company
Better company image
.

CUSTOMER FOCUS:

CUSTOMERS
“Customer is the King”
“Quality what the customer wants” It emphasis on the customer.
Customer satisfaction must be the primary goal of any organization, Si it is essential for an
every employee of the organization understands the importance of the customer.

Traditionally, a customer can be defined as “one who purchases a product or service”.

But in TQM there are two distinct types of customers – Internal and External.

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✓ External customers can be defined in many ways such as the one who uses the product or
service, the one who purchases a product or service to the one who influences the sale of the
product or service. An external customer exists outside the organization and generally falls
into three categories: current, prospective and lost customers.

✓ Internal customers exist within the organization and take part in the process of conversion
of inputs into outputs.

CUSTOMER SATISFACTION MODEL

✓ The Customer is the ultimate judge of quality since the customer-supplier chain starts and
ends with customers.
✓ In Japanese the word – okyakusama- means both “customer” and “honorable guest”.
✓ World class organizations are obsessed with meeting and exceeding customer expectations.
Therefore, customer satisfaction has gained more importance as it is translated into
profitability.

1. James Teboul’s model of customer satisfaction

In this model the customer’s needs are represented by circle and the square represents the
product or service offered by the company.

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The intersection portion is perceived as customer satisfaction. So it is understood that the

company’s should strive to increase the intersection portion.(customer satisfaction)

2. Kano’s Model of Customer Satisfaction

➢ The Kano Model of Customer satisfaction divides product attributes into three categories:
threshold, performance, and excitement. A competitive product meets basic attributes,
maximizes performances attributes, and includes as many “excitement” attributes as
possible at a cost the market can bear.

➢ The customer satisfaction model from N. Kano is a quality management and marketing
technique that can be used for measuring client happiness.

1. Basic Factors. Or Threshold Attributes (Dissatisfies. Must have.)

The minimum requirements which will cause dissatisfaction if they are not fulfilled
but do not cause customer satisfaction if they are fulfilled (or are exceeded). The
customer regards these as prerequisites and takes these for granted. Basic factors
establish a market entry 'threshold'.

Threshold (or basic) attributes are the expected attributes or “musts” of a product, and
do not provide an opportunity for product differentiation. Increasing the performance
of these attributes provides diminishing returns in terms of customer satisfaction;
however the absence or poor performance of these attributes results in extreme
customer dissatisfaction. An example of a threshold attribute would be brakes on a
car.

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2. Excitement Factors or Excitement Attributes. (Satisfiers. Attractive.) –

The factors that increase customer satisfaction if delivered but do not cause
dissatisfaction if they are not delivered. These factors surprise the customer and
generate 'delight'. Using these factors, a company can really distinguish itself from its
competitors in a positive way.
Excitement attributes are unspoken and unexpected by customers but can result in
high levels of customer satisfaction, however their absence does not lead to
dissatisfaction.

3. Performance Factors or Performance Attributes.(Satisfiers, Dissatisfiers)

The factors that cause satisfaction if the performance is high and they cause
dissatisfaction if the performance is low. Here, the attribute performance-overall
satisfaction is linear and symmetric.

Performance attributes are those for which more is generally better, and will
improve customer satisfaction. The price for which customer is willing to pay for a
product is closely tied to performance attributes.

For example, customers would be willing to pay more for a car that provides them
with better fuel economy.

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The additional three attributes which Kano mentions are:

4. Indifferent attributes. The customer does not care about this feature.
5. Questionable attributes. It is unclear whether this attribute is expected by the customer.
6. Reverse attributes. The reverse of this product feature was expected by the customer.

Car Rental Example:

➢ Tires are required. A customer expects tires; the rental agency gets no credit for
providing them, if they are not provided the customer is not at all satisfied.

➢ Checkout speed the faster the better. A customer may expect it to take 15 minutes from
when they arrive at the rental counter in the airport until they are driving away in their
car. If they are driving in 5 minutes they are very happy, if they are driving in 45 minutes
they are very unhappy. The faster the better.

➢ Some customer might be delighted if the car had a Global Positioning System in the car,
or remote car locking and unlocking, or the stations on the radio preset to their

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preferences. Delighters often vary with the customer. In addition, delighters often move
over time to required

Project activities in which the Kano Model is useful:

Identifying customer needs
Determining functional requirements
Concept development
Analyzing competitive products

Other tools that is useful in conjunction with the Kano Model:

Prioritization Matrices
Quality Function Deployment
Value Analysis

CUSTOMER RETENTION
✓ Customer Retention is more powerful and effective than customer satisfaction. It is the
process retaining the existing customers.
✓ Customer Retention represents the activities that produce the necessary customer
satisfaction that creates customer loyalty.
✓ Customer satisfaction surveys, focus groups, interviews and observation help determine
what customers think of a service or a product.
✓ Customer Retention moves customer satisfaction to the next level called ‘customer
delight’ by determining what is truly important to the customers and making sure that the
customer satisfaction system focuses valuable resources on things that really matter to
the customer.
SIGNIFICANCE OF CUSTOMER RETENTION
• 60% of organizations future revenue will come from existing customers
• 2% increase in customer retention has 10% decreases in operating cost.
• 96% of unhappy customers do not complain but 3 times likely to convey to other
customers about their bad experience.
• 91% of unhappy customers never purchase goods and services from you.
• It costs 5 times more to attract the customer than retaining the existing customer.
• Customer retention creates customer loyalty and moves customer satisfaction to a next
level called customer delight.

CUSTOMER COMPLAINTS / CUSTOMER FEEDBACK

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Customer Complaints / Customer Feedback is required

✓ To discover customer dissatisfaction
✓ To identify customer needs
✓ To discover relative priorities of quality
✓ To compare performance with the competition
✓ To determine opportunities for improvement

Tools for collecting Customer Complaint

1.Comment card –
Comment card can be attached to the warranty card & included with the product at the
time of the purchase
Intent of this card is to get simple information such as name , age, address, occupation &
what made the customer buy that product
For customer there is little or no incentive to comment
Customers do respond when there is something very good or very bad used in hospitality
industry(hotels, restaurants)

2.Questionnaire –
Popular tool, costly and time consuming - by mail or telephone preferably multiple
choice questions or a point rating system (1 to 5) or (1 to 10)

3.Customer Focus groups

Popular way to obtain feedback
Surveying a focus group is a research method used to find out what customers are really
expecting
Group of customers is assembled in the meeting room to collect information
Good way to obtain intrinsic feeling about the product/service
4.Phone
Toll free Telephone numbers are the effective technique for complaint feedback
Organization can respond faster & cheaply to the complaints

5.Customer visits
Visit to a customer’s place of business is an effective way to gather information
Accurate information obtained –people can see firsthand how the product is performing

6.Report cards - Usually, send to customer on a quarterly basis.

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7.The internet and computer - It includes newsgroups, electronic. bulletin board mailing lists,

8.Employee feedback.
Conventionally companies listen more to the external customers & less to the internal
customer
Employees usually provide deeper insight into conditions
Customers research reveals what is happening
Employees research reveals why it is happening

9.Mass Customization
Capturing the voice of customers using data of what customer want instead of what
customer is thinking about buying and manufacturing exact what they want.
Mass communication is result of flexible manufacturing system(FMS),JIT,& cycle time
reduction

USING CUSTOMER COMPLAINTS

✓ The information gathered using the tools are helpful to know the customer perceptions
and their level of satisfaction and dissatisfaction because a dissatisfied customer can
easily become a lost customer.
✓ Dissatisfied customers many a times don’t complain but simply switch to the competitor.
Only customers who wish to stay will complain. No organization should feel happy if it
does not receive any complaints. It should get frequently get customer feedback to feel or
sense customer dissatisfaction and redress it immediately.
✓ Fast response to customer complaints or feedback is essential.
✓ Customer Satisfaction affects everyone in the organization as it has an effect on
profitability.

SOLVE CUSTOMER COMPLAINTS

✓ Complaints can be collected from all sources (letters, phone -calls, meetings and
verb inputs)
✓ Develop procedures for complaint resolution that include empowering front-
line personnel.
✓ Analyze complaints, but understand that complaints do not always fit into new
categories
✓ Work to identify. Process and material variations and then eliminate the root
cause.
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✓ When a survey response is received, a senior manager should contact the customer
and strive to resolve the concern.
✓ Establish customer satisfaction measures and constantly monitor them.
✓ Communicate complaint information, as well as the result of all investigation
solution, to all people in the organization. .
✓ Provide a monthly complaint report to the quality council for their evaluation and
needed, the assignment of process improvement teams.
✓ Identify customer's expectations beforehand rather than afterward through complaint
analysis.
Benefits of having satisfied customers are:
❖ Lower Marketing costs
❖ Lower Selling Costs
❖ Lower Warranty Costs
❖ Higher Sales Conversion Ratios

QUESTION & ANSWERS

PART A
1. Define quality.
(i) Quality is defined as the predictable degree of uniformity and
dependability, at low cost suited to the market.(Deming).
(ii) Quality is defined as fitness for use(Juran).
(iii) Quality is defined as conformance to requirements (Crosby).
(iv) Quality is totality of the characteristics of entity that bear on its ability to
satisfy stated and implied needs(ISO).

Quality = Performance x Expectations

2. .
Define Total Quality Management?
Total - Made up the whole
Quality - Degree of excellence a product or service provides
Management - Act, Art or Mg, directing, Manner of handling, controlling, directing,
etc

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TQM is the management approach of an organization, centered and quality based on the
participation of all its members and aiming a long term success through customer
satisfaction and benefits to all members of the organization and to society. – Indian
Standard Organization (ISO)

3. Givethe Objectives of TQM?

To develop a conceptual understanding of the basic principles and methods associated with
TQM;
To develop an understanding of how these principles and methods have been put into
effect in a variety of organizations;
To develop an understanding of the relationship between TQM principles and the theories
and models studied in traditional management;
To do the right things, right the first time, every time.

4. What are the principle of TQM?

1. Be Customer focused .
2. Insure Total Employee Involvement.
3. Process Centered:
4. Integrated system:
5. Strategic and systematic approach:
6. Continual Improvement:
7. Fact Based Decision Making
8. Communication:

5. Mention the dimensions of product and service quality.

Dimensions of Product quality:
1. Performance 2. Reliability 3. Durability 4. Serviceability 5. Aesthetics
6.Features 7. Perceived quality 8.Conformance to standards

Dimensions of service quality:

1.Time and timeliness 2.Completeness 3.Courtesy 4.Consistency
5.Accessibility6.Accurace 7.Responsiveness 8.Competence
6. Give the Basic Concepts of TQM?
1.Top management commitment
2.Focus on the customer

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3. Effective involvement and utilization of the entire work force

4. Continuous improvement
5.Treating suppliers as partners
6. Establishing performance measures for the processes
7. Mention the eight elements of TQM?
Ethics
Integrity
Trust
Training
Teamwork
Leadership
Recognition
Communication
8.What are the four pillars of TQM ?
1.Problem solving technique
2.Interpersonnel skills
3.Team work
4.Quality improvement process.

9. Tabulate the tangible and intangible benefits of TQM.

Tangible Benefits Intangible Benefits
Better product quality Effective team work
Productivity improvement Enhancement of job interest
Reduced quality costs Improvement in human relation and
Increased market work area morale
Increased profitability Participation culture
Reduced employee grievances Customer satisfaction
Enhanced problem solving capacity
Improved corporate health and
character of the company
Better company image
10. Give the Obstacles associated with TQM Implementation?
Lack of management commitment
Inability to change organizational culture
Improper planning
Lack of continuous training and education

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Incompatible organizational structure and isolated individuals and departments

Ineffective measurement techniques and lack of access to data and results.
Paying inadequate attention to internal and external customers.
Inadequate use of empowerment and teamwork

11. Define the concept of Deming philosophy

1. Create and communicate to all employees a statement of the aims and purposes of the
company.
2. Adapt to the new philosophy of the day; industries and economics are always changing

12.Define TQM in terms of ISO and ISI.

➢ "TQM is 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." BY ISO
➢ TQM is an integrated organizational approach in delighting customers (both internal and
external) by meeting their expectations on a continuous basis through every one
involved with the organization working on continuous improvement in all products,
services, and processes along with proper problem solving methodology - INDIAN
STATISTICAL INSTITUTE ( ISI )

13.Mention the Seven names of quality Gurus and their contribution .

Quality Guru Main Contribution
Walter A. Shewhart Contributed to understanding of process variability.
Developed concept of statistical control charts.
W. Edwards Deming Developed “14 Points” to guide companies in quality
improvement.
Joseph M. Juran Defined quality as “fitness for use.” –Developed concept
of cost of quality.
Armand V. Introduced concept of total quality control.
Feigenbaum
Philip B. Crosby Coined phrase “quality is free.” –Introduced concept of
zero defects.
Kaoru Ishikawa Developed cause-and-effect diagrams. –Identified concept
of “internal customer.”
Genichi Taguchi Focused on product design quality. –Developed Taguchi
loss function.

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14. What are the seven deadly diseases of Deming’s.

Lack of constancy of purpose
Emphasis on short-term profits
Evaluation by performance, merit rating, or annual review of performance. i.e., over
reliance on performance appraisal
Mobility of management
Running a company on visible figures alone. i.e., over emphasis on visible figures
Excessive medical costs
Excessive costs of warranty, fueled by lawyers who work for contingency fees

15.Explain PDCA cycle.

Deming’s Wheel or Deming Cycle or PDCA cycle
The Deming Wheel or Deming Cycle which is also known as the PDCA Cycle is a problem
solving problems adopted by firms engaged in continuous improvement.
The cycle consists of the following steps:

Plan : Define the problem to be addressed, collect relevant data and analyze the
problem's root cause.
Do: Develop and implement a solution; decide upon a measurement to gauge its effectiveness.
Check: Confirm the results through before-and-after data comparison.
Act: Document the results, inform others about process changes, and make recommendations
for the problem to be addressed in the next PDCA

16.Explain Jura’s trilogy on quality.

4. QUALITY PLANNING:
➢ Determine internal and external customers.
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➢ Develop the process to produce product and service

➢ Transfer plans to operations.
5. QUALITY CONTROLS
➢ Determine items to be controlled
➢ Set goals for the control
➢ Compare actual performance to goal
6. QUALITY IMPOROVEMENT
➢ Establishment of quality council.
➢ Identify the improvement projects.
➢ Establish the project teams with a project leader.
17.What are the four absolutes of Crosby’s quality management.
5. Quality means conformance to requirements, not goodness.
6. Quality is achieved by prevention, not appraisal.
7. Quality has a performance standard of Zero Defects, not acceptable quality levels.
8. Quality is measured by the Price of Nonconformance, not indexes.
18.Who are external and internal customers?
✓ External customers can be defined in many ways such as the one who uses the product or
service, the one who purchases a product or service to the one who influences the sale of the
product or service. An external customer exists outside the organization and generally falls
into three categories: current, prospective and lost customers.

✓ Internal customers exist within the organization and take part in the process of conversion
of inputs into outputs.
19.Explain Teboul’s model of satisfaction.
James Teboul’s model of customer satisfaction
In this model the customer’s needs are represented by circle and the square represents the
product or service offered by the company.

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The intersection portion is perceived as customer satisfaction. So it is understood that the

company’s should strive to increase the intersection portion.(customer satisfaction)

20.Explain Kano model of customer satisfaction.

➢ The Kano Model of Customer satisfaction divides product attributes into three categories:
threshold, performance, and excitement.
➢ The customer satisfaction model from N. Kano is a quality management and marketing
technique that can be used for measuring client happiness.

21. What is meant by customer retention?

✓ Customer Retention is more powerful and effective than customer satisfaction. It is the
process retaining the existing customers.

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✓ Customer Retention represents the activities that produce the necessary customer
satisfaction that creates customer loyalty.
✓ Customer satisfaction surveys, focus groups, interviews and observation help determine
what customers think of a service or a product.
22. Define customer complaints. List the various tools used for receiving complaints.
It is defined as n expression of dissatisfaction with a partner/service either orally or writing from
an internal or external customers. Customer complaints are mainly either related to product itself
or related to after-sales-service.
The various tools used are:
a. Comment card.
b. Customer questionnaire
c. Focus groups
d. Toll-free telephone numbers
e. Report cards
f. The Internet and computer etc.
g. Mass customization
h. Employee feedback

23. What are focus groups?

Focus groups are moderated , small group discussions where a pre selected group of
individuals provide insight into their preferences, attitudes and opinions about
product/service.
PART - B
1. Write down the underlying principles of TQM
2. Explain the barriers to TQM implementation and solution.
3. Explain in detail about TQM frame work.
4. Explain the various dimensions of quality with respect to the following: quality in products
and quality in service
5. Illustrate the various steps involved in customer satisfaction process
6. Explain Deming’s fourteen point philosophy for quality management. How do you feel
that these will be useful in today’s context in service industry?
7. Discuss the need and basics concepts of TQM
8. Explain the fourteen steps involved in Crosby’s total quality approach
9. Explain customer feedback collection tools and how to solve customer complaints.
10. Explain in detail Juran’s principles of quality improvement

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