ChapterSev

en
Qual
i
tyManagementandCont
rol
7.
1.Meani
ngofQual
i
ty
TheAmer i
canSociet
yforQual
it
y(ASQ)def i
nesqualit
yas“ asubjecti
vetermforwhi ch
eachpersonhashi sorherowndef i
nit
ion.Intechnicalusage,qual
itycanhav etwo
meanings:
1.Thechar act
eri
sti
csofaproductorservi
cethatbearoni tsabi
li
tytosati
sfystated
orimpl
iedneedsand
2. A productorservi
cefr
eeofdef i
cienci
es.”Obviously
,quali
tycanbedef i
nedi n
manyway s,
dependi
ngonwhoi sdefi
ningitandtheproductorservi
ceitr
efersto.
Qual
i
tyf
rom t
heCust
omer
’sPer
spect
ive
Defi
nequal
ityasaser
vice’
sorproduct
’sf
it
nessfori
tsintendeduse,orf
it
nessf
oruse;
howwelldoesitdowhatthecust
omeroruserthi
nksitissupposedtodoandwantsit
todo?
Qual
i
tyf
rom t
hePr
oducer
’sPer
spect
ive
Productorser v i
cedesi gnresult
sindesi gnspecifi
cati
onst hatshouldachievet he
desir
edqual i
ty.Howev er,oncetheproductdesignhasbeendet ermi
ned,theproducer
percei
vesqualitytobehowef f
ecti
velyt
hepr oduct
ionprocessisabletoconfor
mt ot he
specif
icat
ionsr equiredbyt hedesignrefer
redt oasthequalit
yofconf ormance.What
thi
smeansi squalityduringproducti
onfocusesonmaki ngsuret hatt
heproductmeet s
thespecif
icati
onsr equiredbythedesign.
AFi
nal
Per
spect
iveonQual
i
ty
Weappr oachedqual it
yf r
om two per spect
ives,thecust
omer’
sandt heproducer’s.
Thesetwoper specti
v esaredependentoneachot herasshowninFigure7.1.Although
productdesi
gni scust omer-motivated,itcannotbeachievedwit
houtt hecoordinati
on
andpar t
ici
pat
ionoft hepr
oductionpr ocess.Whenapr oductorser vi
ceisdesi gned
withoutconsi
deringhow i twillbepr oduced,itmaybei mpossi
blefort heproduct i
on
processtomeetdesi gnspecifi
cat i
onsori tmaybesocost l
ytodosot hattheproductor
servi
cemustbepr i
cedpr ohi
bit
ivelyhigh.

1
 Fi
gur
e7.
1theMeani
ngofQual
i
ty
Figure 7.1 depictst he meani
ng ofquali
tyfrom the producer’
s and consumer’s
perspectiv
es.
Thef i
naldet er
mi nat
ionofqualit
yisfit
nessforuse,whichisthecustomer ’
sview of
quali
ty.Itistheconsumerwhomakest hefi
naljudgmentregar
dingquali
ty,andsoitis
thecustomer ’
sviewt hatmustdominat
e.
7.
2.Det
ermi
nant
sofQual
i
ty
7.
2.1.Di
mensi
onsofQual
i
tyf
orManuf
act
uredPr
oduct
s
Thedi
mensi
onsofqual
i
tyf
ormanuf
act
uredpr
oduct
saconsumerl
ooksf
ori
ncl
udet
he
fol
l
owi
ng:
1.Performance:Thebasi coper at
ingchar acterist
icsofapr oduct;forexampl e,how
well acar handl esori t
sgasmi l
eage.
2.Feat ures:The“ extr
a”itemsaddedt ot hebasi cfeatures, suchasast ereoCDora
l
eat herinteri
ori nacar .
3.Reliabili
ty:Thepr obabili
tythatapr oductwi lloperatepr oper l
ywi t
hinanexpect ed
ti
mef r
ame; thatis,aTVwi l
lwor kwi thoutrepai rforaboutsev eny ears.
4.Conf ormance:Thedegr eetowhi chapr oductmeet spr e-establi
shedst andards.
5.Durabi li
ty:Howl ongt heproductl ast s;i
tsl i
fespanbef orer eplacement .Apai rof
L.L.Beanboot s, wit
hcar e,mightbeexpect edt olastal i
fet i
me.
6.Serv i
ceabi l
ity:Theeaseofget t
ingr epai
rs,thespeedofr epair
s,andt hecour tesy
andcompet enceoft herepairperson.
7.Aest hetics:Howapr oductlooks, feels,sounds, smel l
s, ortastes.
8.Safet y
:Assur ancet hatthecust omerwi ll
notsuf f
erinjuryorhar mf rom apr oduct;
anespeci al
lyimpor tantconsiderat i
onf oraut omobi l
es.
9.Otherper ceptions:Subj ect
iveper cept i
onsbasedonbr andname, advertisi
ng,and
thelike.

2
7.
2.2.Di
mensi
onsofQual
i
tyf
orSer
vices
Thedimensi onsofqual ityforaser vicedi ffersomewhatf r
om thoseofamanuf act ured
product.Servicequal i
tyismor edi rectlyr elatedt ot i
me,andt heinteract ionbet ween
employeesandt hecustomer .Ev ansandLi ndsay 2i dent if
ythef oll
owingdi mensi onsof
servi
cequal ity .
1.Ti meandt imel i
ness:How l ongmustacust omerwai tforser v ice,andi si t
compl etedont ime?Forexampl e,isanov er
nightpackagedel i
veredov ernight?
2.Compl et eness:I severyt hingt hecust omeraskedf orprovided?Forexampl e,isa
mai lor der fr
om acat aloguecompanycompl etewhendel i
v er
ed?
3.Cour tesy :Howar ecust omer st r
eatedbyempl oy ees?Forexampl e, arecat alogue
phoneoper atorsatL. L.Beanni ceandar etheirvoi cespleasant?
4.Consi st ency :Isthesamel ev
elofser vicepr ov i
dedt oeachcust omereacht ime?
Isy ournewspaperdel iver edont i
meev erymor ni
ng?
5.Accessi bilit
yandconv eni ence:Howeasyi sitt oobt aintheservice?Forexampl e,
wheny oucal lL.L.Beandoest heser vicer epresent ati
veanswerqui ckl y?
6.Accur acy :Istheser viceper f
or medr ightev er yt i
me?I sy ourbankorcr editcar d
statement correcteverymont h?
7.Responsi veness:Howwel ldoest hecompanyr eacttounusualsi tuat i
ons,whi ch
can happen f requentlyin a ser vice company ? Forexampl e,how wel li sa
telephoneoper at
oratL. L.Beanabl etor espondt oacust omer’squest ionsabout
acat aloguei tem notf ullydescr i
bedi nt hecat alogue?
7.
3TheCostofQual
i
ty
Accordi
ng tolegendary quali
ty gur
u Armand Feigenbaum,“ qualit
y costs ar
et he
foundat
ionforquali
tysystemseconomics.”Quali
tycostshav etradit
ional
l
yser vedas
thebasisf
orevaluat
ingi
nv est
ment si
nquali
typr
ograms.Thecost sofqual i
tyaret hose
i
ncurredtoachi
ev egoodqualit
yandt osati
sfyt
hecust omer,aswel lascostsincurred
whenqualit
yfai
lstosati
sfythecustomer.
Thus,quali
tycostsfal
lint
ot wocategori
es:thecostofachievinggoodqual
i
ty,al
so
knownast hecostofqualit
yassurance,andt hecostassociatedwit
hpoor-
qual
it
y
product
s,al
sorefer
redtoasthecostofnotconformi
ngtospecif
icati
ons.

A.TheCostofAchi
evi
ngGoodQual
i
ty
Thecost
sofaqual
i
tymanagementpr
ogr epr
am ar event
ioncost
sandappr
aisalcost
s.

 Prevention cost sr et he costs oftryi

ng to preventpoor -
quali
typr oductsf r
om
reachingt hecust omer .Preventi
onrefl
ectsthequalityphi
losophyof“ doi tri
ghtthe
fi
rstti
me, ”t hegoal ofaqualitymanagementpr ogram.Exampl esofpr ev enti
oncosts
i
nclude:
- Qual i
typl anningcost s:Thecost sofdev el
opingandi mpl ement i
ngt hequalit
y
managementpr ogram.
- Pr oduct -desi
gn cost s: The cost s of desi gning pr oducts wi th qualit
y
charact eri
sti
cs.
- Pr ocess cost s:The cost s expended t
o make sur ethe pr oduct iv
e process
confor mst oqual i
tyspecifi
cati
ons.
- Tr ainingcost s:Thecost sofdev el
opingandput ti
ngonqual it
yt r
ainingpr ogr
ams

3
 foremployeesandmanagement.
- Inf
ormation costs:The cost
s of acqui
ri
ng and mai
ntai
ning (t
ypi
cal
ly on
computers)datarel
atedt
oqualit
y,andt
hedevel
opmentandanaly
sisofrepor
ts
onquali
typerfor
mance.

 Appr aisalcost sar et hecostsofmeasur ing,test ing,andanal y

zingmat erials,par ts,
products,andt hepr oduct i
vepr ocesst oensur et hatproduct -
quali
tyspeci ficati
ons
arebeingmet .Exampl esofappr aisalcostsincl ude:
- Inspect i
onandt esti
ng:Thecost soft esti
ngandi nspect ingmat erials,par t
s,and
theproductatv ariousstagesandatt heendoft hepr ocess.
- Testequi pmentcost s:Thecost sofmai nt ainingequi pmentusedi nt est ingt he
quali
tychar acteristi
csofpr oduct s.
- Oper atorcost s:Thecost soft hetimespentbyoper at orstogat herdat af or
test
ingpr oductqual i
ty,t
omakeequi pmentadj ustment st omai ntainqual it
y ,
and
tostopwor kt oassessqual ity.
Appraisalcostst endt obehi gheri naser viceor ganizati
ont hani namanuf act uring
companyand,t her efore,areagr eaterpr oportionoft otalqual i
tycost s.Qual it
yi n
servi
cesi srelatedpr i
mar il
ytot hei nteract
ionbet weenanempl oyeeandacust omer ,
which makes t he costofappr ai
sing qual it
ymor e diffi
cul t
.Qual i
tyappr aisali na
manuf actur
ing oper ati
on can t ake pl ace almostexcl usivelyi n-house;appr ai salof
servi
cequal it
yusual lyrequirescust omeri nt er
views,sur vey s,quest i
onnair es,andt he
l
ike.

B.TheCostofPoorQual
i
ty
Thecostofpoorqual i
ty( COPQ)i sthedi ff
erencebet weenwhati tactual
lycoststo
produceapr oductordeli
veraser vi
ceandwhati twoul dcosti
ftherewer enodefect
s.
Mostcompani esfi
ndthatdef ect
sr eworkandot herunnecessaryacti
vi
tiesrel
atedto
qualit
ypr obl
emssigni
ficantl
yinfl
atecost s;esti
mat esrangeashi ghas20t o30% of
totalrevenues.Thisis generall
yt he l
argestqual it
ycostcat egoryin a company,
frequent
lyaccounti
ngfor70t o90%oft otalquali
tycosts.
Thisisalsowherethegreatestcostimprovementi spossibl
e
Thecostofpoorqual
i
tycanbecat
egor
izedasi
nter
nalf
ail
urecost
sorext
ernalf
ail
ure
cost
s.
 I
nt ernalfai l
urecost sareincurr
edwhenpoor -quali
typr oductsaredi scoveredbef ore
theyar edel i
veredt othecustomer .Exampl esofi nternalfai
l
urecost sinclude:
- Scr apcost s:Thecost sofpoor -qualit
yproduct sthatmustbedi scarded, i
ncluding
l
abor ,mat erial,andindi
rectcost s.
- Rewor kcost s:Thecost soff ixi
ngdef ecti
vepr oduct
st o conf orm to qual it
y
specificati
ons.
- Pr ocessf ail
ur ecosts:Thecost sofdet erminingwhyt hepr oduct i
onpr ocessi s
produci ngpoorqual i
typroducts.
- Pr ocessdownt i
mecost s:Thecost sofshut t
ingdownt hepr oduct i
vepr ocesst o
fi
xt hepr oblem.
- Pr ice-downgr adingcosts:Thecost sofdiscount ingpoor -
quali
typr oducts—t hatis,
selli
ngpr oduct sas“ seconds.”
 Externalf ail
urecost sareincurredaf terthecust omerhasr ecei
v edapoor -qualit
y

4
 productandar epr imarilyrelat
edt ocust omerser vice.Exampl esofext ernalf ail
ure
costsinclude:
- Cust omer compl aint cost s:The cost s of i nvesti
gating and sat i
sfactoril
y
respondingt oacust omercompl ai
ntr esul t
ingfrom apoor -quali
typroduct.
- Pr oductr eturncost s:Thecost sofhandl ingandr epl
acingpoor -quali
typr oducts
retur
nedbyt hecust omer .IntheUni tedSt atesitisest i
mat edthatproductr eturns
reducecompanypr of it
abil
it
ybyanav erageof4%annual l
y.
- War r
antycl aimscost s:Thecost sofcompl yi
ngwi thproductwar ranti
es.
- Pr oductl i
abilit
ycost s:Thel i
tigat
ioncost sresultingfrom pr oductliabil
ityand
customeri njury.
- Lostsal escost s:Thecost sincurredbecausecust omersar edi ssati
sfiedwi th
poor-qualit
ypr oductsanddonotmakeaddi ti
onal purchases.
I
nternalfail
urecost st endt obel owf oraser vice,whereasext ernalfail
urecost scanbe
qui
tehi gh.
7.
4Qual
i
tyCi
rcl
esandQual
i
tyI
mpr
ovementTeams
7.
4.1Cont
inuousI
mpr
ovement
s
KaizenistheJapaneset ermf orconti
nuousimprovement ,notonlyint hewor kpl
acebut
al
soi none’ sper sonall
i
fe,homel if
e,andsocialli
fe.Int hewor kplace,kaizenmeans
i
nvolvingev eryonei naprocessofgr adual
,organized,andcont inuousi mpr ov
ement.
Everyempl oyeewi thi
nanor gani
zati
onshouldbeinv ol
v edinworkingt ogethertomake
i
mpr ovement s.Ifanimprovementisnotpartofacont inuous,ongoingpr ocess,i
tisnot
consider
edkai zen.
Letusseethet
hreeappr
oachest
hatcanhelpcompani
eswit
hcont
inuousimpr
ovement
:
thepl
an–do–st
udy–act(
PDSA)cycl
e,benchmarki
ngandt
hequal
it
ycircl
es.
A.TheDemi
ngWheel
(PDCACy
cle)
Thepl an–do–study–act( PDSA)cy cl
edescr i
best heacti
vit
iesacompanyneedst o
performinor dertoincorporat
econt inuousimprovementini t
soperati
on.Thi
scy cle,
showni nFigure7-2,i
salsoreferr
edt oast heShewhartcy
cleort heDemingwheel
.The
ci
rcularnatureoft hi
scy cleshowst hatconti
nuousi mprovementisanev er
-ending
process.Let’
slookatthespecifi
cstepsi nthecycl
e.

 PlanThef i
rststepinthePDSA cy cl
ei sto pl
an.Manager
smustev aluat
et h
curr
entprocessandmakepl ansbasedonanypr obl
emstheyfind.Theyneedt o
documental lcurr
entprocedures,col
lectdata,and i
dent
ify probl
ems.Thi s
i
nformati
onshouldthenbest udi
edandusedt odevel
opaplanf orimprovement
aswellasspecif
icmeasur
est oeval
uateperf
ormance.

 Do The nextst ep int he cyclei simpl

ement i
ng t he pl do)
an ( .Duri
ng the
i
mpl ementat i
on pr ocessmanager sshould documental lchangesmade and
coll
ectdat
af orev aluat
ion.
 StudyThet hir
dst epist ostudyt hedat
acol l
ectedint hepreviousphase.The
dataareev aluatedt oseewhet herthepl
anisachi ev
ingt hegoalsest
abli
shedin
theplanphase.

 ActThel
astphaseoft
hecy
clei
stoactont
hebasi
soft
her
esul
tsoft
hef
ir
st

5
 threephases.Thebestwaytoaccompli
sht hisi
st ocommuni catether esult
sto
othermember soft
hecompanyandthenimpl ementthenewpr ocedureifithas
beensuccessf ul
.Not
ethatt
hisi
sacy cl
e;thenextstepistoplanagai n.Afterwe
hav eacted,weneedtocont
inueeval
uati
ngt heprocess,pl
anning,andr epeati
ng
thecycleagain.

Fi
gur
e7.
2theDemi
ngWheel
(PDCACy
cle)
B.Benchmar
king
Benchmar ki
ng Anotherway compani es implementcont inuous improvementis by
studyingbusi nesspracti
cesofcompani esconsidered“besti nclass.”Thisiscall
ed
benchmar ki
ng.Theabi l
i
tytolear
nandst udyhowot her
sdot hingsisanimportantpart
ofcont inuousimprovement.Thebenchmar kcompanydoesnothav etobeinthesame
businessasl ongasi texcel
satsomet hi
ngthatthecompanydoi ngthestudywishest o
emul ate.Forexampl e,manycompani eshaveusedLands’Endt obenchmar kcatal
og
dist
ributionandor derfil
li
ngbecauseLands’Endi sconsi deredal eaderinthisarea.
Similarl
y ,many compani es have used Amer i
can Express t o benchmark confl
ict
resoluti
on.
C.Qual
i
tyCi
rcl
es
Oneoft hefir
stteam-basedappr oachestoqualit
yimpr ovementwasquali
tycir
cles.
Call
edqual i
tycont
rolcircl
esinJapanwhent heyori
ginatedduri
ngthe1960s,
theywere
i
ntroducedintheUni t
edSt at
esinthe1970s.Aqual i
tycircl
eisasmall
,vol
untar
ygroup
ofempl oyeesandt heirsuperv
isor(
s),compri
singat eam ofabout8to10member s
fr
om thesamewor kareaordepartment.
7.
5Tot
alQual
i
tyManagement(
TQM)
WhatisTQM?
Tot
alQual i
ty Managementi s a pr
ocess wi
th st
rong phi
l
osophi
calbases whi
ch
i
ncorpor
atesmanyoft heconcept
suponwhichtot
alqual
it
ycontr
olsyst
emsarebased,

6
butgoesevenfur
theri
nemphasizi
ngt hatquali
tyshoul
dbemanagedi nt
othesyst
em
and qual
it
ymanagementshoul d al
way s be or
ient
ed towar
ds t
he achi
evementof
complet
ecustomersat
isf
act
ion.
Letusunder
standt
hedif
ferentel
ementsofTQM:
◊ Total
:Itref
erst
oeveryt
hingincl
udi
nghumanr esourcesandequi
pmentassoci
ated
wi
ththecompanyt
hatisinvol
vedi
ncontinuousimprovement.
◊ Quali
ty:Itreferstotheexpressedandi mpl iedr
equir
ementoft hecustomer sthatar
e
metfullyi.
e.basedont hecust omers’percepti
onofapr oduct’
sdesignandhowwel l
thedesignmat chestheor i
ginalspecif
icati
onaswel lasthestatedorimpliedneeds
ofthecust omer s.Accordi
ngt oISO 1994qual it
yi sthet ot
alit
yoff eatur
esand
char
act eri
sticsofapr oductorser v
icet hatbearoni t
sabili
tyt omeetast atedor
i
mpliedneeds, fi
tnessf
oruse( Jur
an)andconf ormancetorequirement(Crosby).
◊ Management :I
tmeanst hattopmanagementandexecut ivesar efullycommi tt
edt o
thephilosophyofTQM.Sat isfy
ingthecustomers’needsandexpect ati
onsi mplies
thatacompanyneedst odefineaccur
atelyear
lyinit
sproduct /
servicedev el
opment
cycle,vari
ousattri
butesrelatedtodesign,perf
ormance,price,safety ,anddel i
very
specifi
cati
onsf r
om theconsumer ’
sperspecti
ve.Themoder ntrendi nt otalquali
ty
managementi stoexceedtheexpectat
ionsoftheconsumer sanddel i
ghtt hem.
TotalQual
it
yManagementasdefi
nedbyRichardJ.Schonber
gerastheTotalQual
it
y
Managementisasetofcomponentsandtool
sf orget
ti
ngallempl
oyeesfocusedon
conti
nuousimpr
ovementi
ntheey
esofthecust
omer .
Thequal it
yconcept sinvol
v edinTQM hav ewor kedsowel linthemanuf acturi
ngsect or
thatthesecanwel lbeappliedtoser v
icessuchasbanki ng,transportati
on,retai
li
nget c.
TotalQual i
ty Managementpr ov ides t he ov erallconceptt hatf ost
ers continuous
i
mpr ovementi n an or ganization.I temphasi zes upon a sy stemat i
c,i nt
egrated,
consistentandor ganizati
on-wideper spectivet hatinvol
veev eryt
hingandev er
yone.I n
otherwor d,TQM i sani mportantel ementofcor porat
eculturethatr epresentsav ision
aswel lassomebehav i
oralpat ternsshar edbyal lthemember soft heor gani
zat i
on.
TQM hast hreedimensions;excel lence, universalit
yandper petuit
y.InTQM i ti
snotj ust
produces,pr ocess,customer sandempl oyeesbuti tisentir
egamutofor gani
zational
acti
viti
es.

Cust
omer
Requir
ement
Employ
ee
EmpowermentCust
o
merRequir
ement Reput
ati
onand
Value
Rewar
dReputat
Enhancement Manageme
nt

Cust
omerFocus Benchmar
kin
Conti
nuous
I
mprovement Cust
omerFocus g

7
TQMT Uni
versal
Per
cept
ion Responsibi
l
ity
 Fi
gur 3KeyConcept
e7. sofTQM
1.ManagementCont rolto Quali
ty:An or ganizat
ion’s per
sonal i
tyand cult
ure wil
l
ult
imatelyr ef
lectitsseni
ormanagement ’
sv al
ues.Ifanor ganizat
ionisseri
ous
aboutimpl ementingTQM, t
hecommi tmentt odosohav etost artatt
hetopandt he
organi
zation’sseniormanagementhast obeunwav eri
ngini tscommitmentt o
quali
ty.I
fmanagementi swill
i
ngt oincreasethesal esonlyifqual i
tyl
evel
sareupt o
requi
rement s,therestoftheorganizati
onwi llunderstandthatt hecommi t
mentt o
quali
tyisreal.
2.CustomerFocused:TQM i sfocusedont herequirementoft hecustomer s.Onthe
personalfr
ontpeopleonlygobackt or estaurant
st hatful
lysati
sfythem andshop
regul
arl
yatstorethatmeettheirneeds.Ani ndivi
dualcustomerhast hesamer ange
ofemot i
onsasaper son.Cust
omer( personalorindivi
dual)af
terbeingdisappoi
nted
andcheatedwithdrawthebusinessandst artbuyi
ngel sewher
e.
3.CustomerRequirements:InTQM t hef i
rstquesti
ont oansweri swhatdoest he
customer requi
res? The customer wi llhavef iv
e quest i
ons consci ousl y or
unconsciousl
y.Thesearet hefivedimensionofqual i
ty.Thet radi
tionalv i
ew of
qual
ityissimpleconfor
mancet ospeci f
icat
ion.Howev er,t
hisisonlypar toft ot al
qual
ity.Quali
tyi
nvol
vesallofthef i
vedimensionsforthecustomert obesat isfied.
Qualit
yiftheconfor
mancet outil
izati
onandr el
atestot hevalueoft hepr icepai d.
Themeasur ementofquali
tywil
lrefl
ecteachoftheelementment ionedbel ow:
♪ Thespeci
fi
cat
ionf
ort
hepr
oductorser
vices

♪ Theconf
ormancet
othespeci
fi
cat
ions

♪ Ther
eli
abi
l
ityorconf
ormancet
hrought
ime

♪ Thev
alueofmoneyaspect
s

♪ Thedel
i
ver
y(Qual
i
tyont
ime)

4.Prevent
ingRatherthanDetect
ingDefects:TQM i
samanagementphi losophyt
hat
seekstopreventpoorqual
i
t yi
nproductsandservi
ces,r
atherthansimplytodet
ect
andsortoutdefect
s.Ifasi
nglechar
acterist
ici
smoststrongl
yat t
achedtotheTQM

8
 phi
losophy,i
tispreventi
onr
athert
handetecti
on.Likemanyoft hephil
osophiesti
ed
toTQM,t hi
sisnotanewconcept .Apopularsayingfrom Hall
iburt
ion’
sWi seSaws,
“Anounceofpr eventi
onisworthapoundofcur e”.Thatwisdom say sital
l,fr
om a
TQM perspect
ives.
5.Universal Qual i
ty Responsi bili
ty: Another basi c TQM pr ecept is t hat t he
responsibi l
it
yf orqual i
tyi s notr estr
icted t
o an oper ation’
s qualityassur ance
department ,buti tisi nst ead a gui ding phil
osophyshar ed byev eryone in an
organizat i
on.I nTQM ev ery onet akesr esponsibil
i
tyf orqualit
y .Doest hist ypeof
thi
nkingwor k?Absol ut
ely .Mostofuswoul di nt
uiti
velysuspectt hati nor dert o
i
mpr ov e qual i
ty,the qual i
t ymanagementdepar t
mentwoul d hav et o grow.I n
compani est hatsuccessf ull
yi mpl ementTQM,j usttheopposi teoccur s.Asqual it
y
i
mpr ov es, t
hatqual i
tyassur ancedepar tmentgetssi milar
.Ifeveryoneisr esponsible
forthequal i
tyoft heoutput( andev er
yoneaccept sthisresponsi bi
l
ity
),theneedf or
asepar at equalit
yassurancef unctiondisappear
s.
6.Quali
tyManagement :Alongwi thanounceofpr ev enti
oniswor t
hapoundofcur eis
anothersayingpar ti
cularl
yrelev anttoTQM,andi tis,Ify
oudonotknowwher ey ou
aregoing,youwi llprobablyendupsomewher e.Thequal i
tymanagementaspectof
TQM askst hequest i
on:Wher ear eweandwher ear ewegoi ng?A basi cTQM
conceptisthatqual i
tyisameasur abl
ecommodi ty,andinordertoimpr ove,weneed
toknowwher ewear e( orstateddi ff
erentl
y,whatt hecurrentqualit
ylevelare),and
weneedt ohav esomei deawher ewear egoi ng( orwhatqual i
tylevelweaspi r
et o),
thi
si s extremelyi mportant concept sin t he quality management . Qualit
y
managementi sthe actofov erseeing al
lact ivi
ti
es and tasks t hatmustbe
accompl i
shed t o mai ntai
n a desi red levelof excel lence.Thi si ncludes the
determinati
onofaqual it
ypol icy,creati
ngandi mplement i
ngqual i
typlanningand
assurance,andqual i
tycont r
ol andqual it
yimpr ovement .
7.ContinuousImpr ovement:TQM espousesaphi l
osophyofcont i
nuousi mprovement
i
nal lar easofanor ganization.Thi
sphi l
osophyt i
esincloselywi t
ht hequal ity
measur ementand uni versallyquali
tyresponsi bil
ityconcepts mentioned abov e.
Qualit
ymeasur ementi sneededi nordert
of ocusi mprov
ementef for
tsappropriately
andcont i
nuousi mprovementshoul dbeper usedi nal
lareas.ThisTQM concept
focuses on f inding shortfallsin administrati
v e,manufacturi
ng and ser v
ice
processest hatcandet ractf rom aquali
tyout put,andimprovingthepr ocesst o
eli
minateundesi r
ableoutputs.
8.EmployeeI nvolvementandEmpower ment:Anot
herfundamentalTQM conceptis
thatempl oyeemustbei nvol
vedandempower ed.Employeeinvolv
ementmeans
everyempl oyeei sinv
olvedinr unni
ngthebusinessandpl aysanact i
ver ol
ein
helpi
ng the or gani
zati
on to meeti ts goal
s.Employee empower mentmeans
employees and management r ecogni
ze that many obstacl
es t o achi
evi
ng
organi
zationalgoalscanbeov ercomebyempl oyeeswhoar epr ovi
dedwi t
hthe
necessarytoolsandauthori
tyt
odoso.
9.Team Work:I
n addit
ion t
ot he TotalQual
it
yManagement( TQM)conceptsof
empower
mentandinvolvementofempl oy
ees,taki
ngadvantagesoft
hesy nergyof
teamsi
sanef f
ecti
vewayt oaddr esstheproblem andchall
engesofcontinuous

9
 i
mprovement
.Dr.Kaur
uIshi
kawafi
rstf
ormali
zedthet
eam’
sconceptaspar
toft
he
TQM phi
l
osophybydevel
opi
ngqual
i
tycir
clesi
nJapan.
10.
Statist
ical
l
yThinki
ng:Thinkingst
atist
icali
sanot herbasi
cTQM phi l
osophy
.Qual i
ty
effortsoft
enrequi
rereducingprocessorpr oductdesignvar
iat
ions,andstat
ist
ical
met hodsarei
deall
ysuit
edt osupporttheseobjecti
ves.
11.
Benchmarki
ng:Compar i
ngonecompany ’
sper f
ormancewi ththatofanot
herisa
refl
exofTQM.Compet i
ti
vebenchmarki
ngi sacontinuousmanagementpr ocess
thathelpsf
irmst oaccessthei
rcompetiti
venessandt ouset hatknowl
edgei n
designi
ngapract
ical
plantoachi
evesuper
iori
tyint
hemar ketpl
ace.
12.
Value Establ
ishment:The l i
nkage bet ween conti
nuous i mpr
ovementand v alue
enhancementi ssimultaneousl
yobv i
ousandsubt le.Thisli
nkagebecomesappar ent
whenoneconsi dersthedomi nionofqual it
ywhi chist heabil
it
ymeetorexceeds
customerexpect ati
onswhi leremov i
ngunnecessar ycost .Removingunnecessary
costsandsi multaneouslysati
sfyi
ngcust omerexpect ati
onsandr equi
rementscan
onlyservetoincreasecustomersatisfacti
on.
13.
Feedback:Perfor
mancefeedbackisvi
talenablemanagersatalll
evel
stoi mpr
ove
thei
rcontri
bution t
othe busi
ness.Feedbackpr ovidesi
nfor
mation on wher
ea
managerist odayandgivesaninduct
ionofl evelofimpr
ovementcompar edwit
h
previ
ousfeedbackprov
idetoqual
it
ymanagement .
14.
Recogni ti
onandRewar ds:Anappr opri
atesy stem ofr ecogni
ti
onandr ewar dis
cri
ticaltoanycompany ’
sTQM pr ogram,par ti
cularl
yast hequali
tyi mpr ovement
processof fersinvolvementt o ordinarywor king people.Posit
iver einforcement
through r ecogni
t i
on and r ewardi s essent i
alt o mai ntai
n achievement and
cont i
nuousi mprov ementt hr
oughpar ti
cipat
ivepr oblem solvi
ngproject s.Peoples
wor kf ormanyr easons,forachi evement ,advancement ,incr
easedr esponsi bi
li
ty,
recogni t
ion,jobi
nterestaswellasf inancetotheper formanceofthefirm.
15.
TheQualit
yDeli
veryProcess:TQM isnotj ustaboutawarenessofqualit
y.TQM
demandsthei
mpl ementat
ionofthenewsy stem.TheQualit
yDeliver
yProcessi
sa
gener
icnameforsuchasy st
em.Thepurposesofthequali
typrocessesar
e:
♪ Ensurethatev
eryoneworksonthoseact
ivi
ti
eswhi
charemosti
mpor
tantf
ort
he
successofthebusinessbyf
ulf
il
li
ngworkgroupmi
ssi
ons.
♪ Impr
ovethe qual
i
tyofwork del
iver
ed (out
puts)tothe cust
omer
sint
ernal
cust
omer
s,t
henextper
sondown-t
he-l
ine,
whor ecei
vet
hework.
♪ El
i
minat
ewor
kthati
swast
edbecausepeopl
edonotdoi
tri
ghtt
hef
ir
stt
ime.

♪ Har
mless t
he combi
ned skil
l
s,ideas and experi
ences ofthe wor
k gr
oup
memberst
oimprovet
hebusinesscont
inuousl
ythroughteam wor
k.
♪ Sat
isf
ytheext
ernal
cust
omer
s.

7.
6.Qual
i
tyCont
rol
andI
mpr
ovement

10
Qual
i
tyTool
s
Amaj orcor
nerst
oneoft hecommi tmentt oqual i
tyi
mpr ovementpr escri
bedbyDemi ng
andtheot herear
lyquali
tygur
usi stheneedt oidenti
fyandpr eventthecausesofqual it
y
problems,ordefects.Theseindivi
dualsprescribedanumberof“ tools”toident
ifythe
causesofqual it
ypr obl
emst hatar esti
llwidelyusedt oday,incl
udingPar et
ochar ts,
processf l
owcharts,checksheets,histograms,scat t
erdi agrams,st ati
sti
calprocess
controlchart
sandcause-and-
effectdiagrams.

7.
6.1St
ati
sti
cal
Qual
i
tyCont
rol

TQM focusesoncust omerdr i

v enqual i
tyst andard,manager i
alleadership,conti
nuous
i
mpr ovement,qual i
ty buil
ti nto pr oductand pr ocess design,i denti
fyi
ng qual it
y
probl
emsatt hesourceandmaki ngqual it
yev eryone’sresponsibi
li
ty.Howev er,tal
king
aboutsolvi
ngqual i
typroblemsi snotenough.Weneedspeci fi
ct oolsthatcanhel pus
maket herightquali
tydecisi
ons.Theset oolscomef rom thefl
iedofst ati
sti
csandar e
usedtohel pidenti
fyquali
typr oblemsi nt hepr oducti
onpr ocessaswel lasinpr oduct
i
tself
.Stati
sti
calQualit
yCont r
ol( SQC)i sthet erm usedtodescr i
bet hesetofst ati
sti
cal
tool
susedbyqual it
yprofessional .Stat
isti
calqual i
tycont r
olcanbedi vi
dedi ntothree
broadcategories:

1.Descri
pti
veStat
isti
cs:Areusedtodescr
ibequal
i
tychar
act
eri
sti
csandrelat
ionshi
ps.
I
ncludedarestati
sti
cssuchast hemean,thestandar
ddevi
ati
on,therangeanda
measureofthedist
ribut
ionofdat
a.

2.Stati
sti
calProcessCont r
ol(SPC) :Involv
esi nspecti
ng arandom sampleoft he
outputfr
om apr ocessanddeci di
ngwhet herthepr ocessi
sproduci
ngproduct
swith
charact
eri
sti
csthatf al
lwithi
napr edeterminedrange.SPCanswersthequesti
onsof
whetherornotthepr ocessisfuncti
oningproperl
y.

3.Accept anceSampl i
ng:I st hepr ocessofr andomlyi nspect ingasampl eofgoodsand
decidingwhet hert oacceptt heent ir
el otbasedont her esults.Accept ancesampl ing
determi neswhet herabat chofgoodsshoul dbeaccept edorr ejected.Thet ool si n
eachoft hesecat egor i
espr ovi
dedi fferentt y
pesofi nformat ionf orusei nanal y zing
quality.Descr ipti
vest atisti
csar eusedt odescribecer tainqual i
tychar acteristics
suchast hecent raltendencyandv ariabili
tyofobser v
eddat a.Al thoughdescr i
pt ion
ofcer tainchar acteri
sticsi shel pful
,theyar enotenought ohel pusev al
uatewhet her
thereisapr oblem wi thqual i
ty.Accept ancesampl ingcanhel pasdot his.Ithelpsus
decidewhet herdesi rablequal it
yhasbeenachi ev edf orabat chofpr oduct sand
whet hert oacceptorr ejectt heitemspr oduced.Al thought hisinformat i
oni shel pf ul
i
nmaki ngthequal it
yaccept ancedeci si
onaf terthepr oducthasbeenpr oduced,i t
doesnothel pusi dent i
fyandcat chaqual i
typroblem dur ingt hepr oductionpr ocess.
Forthisweneedt oolsi nt hestatist
ical processcont rol(SPC)cat egor y
.

Allthreeofthesest at
isti
calquali
tycontrolcategori
esar ehelpf ulinmeasuringand
evaluati
ngthequalit
yofproductsorserv
ices.Howev er
, st
ati
sti
cal processcont
rol(SPC)
tool
sar eused mostf requentl
ybecauset heyi denti
fyqualit
ypr oblemsduring the
producti
onpr ocess.Thequal i
tycontr
oltoolswewi llbelearningaboutdonotonl y
measur ethev al
ueofqual it
ycharacter
isti
cs:theyalsohel pusi dentif
yachangeor

11
v
ari
ati
oninsomequalit
ychar
act
erist
icoft
hepr
oductorprocess.Wewi
l
lfi
rstseewhat
t
ypesofvari
ati
onwecanobser vewhenmeasur i
ngqualit
y.Thenwewil
lbeablet o
i
dent
if
ythespeci
fi
ctoolst
ouseformeasuri
ngt
hisvar
iat
ion.

7.
6.2Qual
i
tyMeasur
es:
Att
ri
but
esandVar
iabl
es
Thequal i
tyofapr oductorserv
icecanbeev
aluat
edusi
ngei
theranat
tri
but
eoft
he
productorser
viceorav ar
iabl
emeasur
e.
Anat tr
ibutei sapr oductchar acteri
st i
csuchascol or,surfacetexture,cleanli
ness,or
perhapssmel lort aste.Att
ributescanbeev al
uatedquicklywithadi screteresponse
suchasgoodorbad,accept abl eornot ,oryesorno.Ev enifquali
tyspeci f
icat
ionsare
complexandext ensive,asimpl eattributetestmightbeusedt odetermi newhet heror
notaproductorser vi
ceisdef ecti
ve.Forexampl e,
anoper at
ormi ghttestal ightbulbby
simplyturningitonandseei ngi fitlights.Ifi
tdoesnot ,i
tcanbeexami nedt ofindout
theexactt echnicalcausef orf ai
lure,butf orSPCpur poses,thefactthati tisdefecti
ve
hasbeendet ermined.
Av ariabl
emeasur ei saproductchar acteri
sti
ct hatismeasur edonacont i
nuousscal e
such as length,wei ght,temper at
ure,ort ime.Forexampl e,the amountofl iqui
d
detergentinaplasticcontainercanbemeasur edt oseeifitconformst othecompany ’s
productspecifi
cations.Orthet i
mei ttakest oser veacust omeratMcDonal d’scanbe
measur edt oseeifitisquickenough.Si nceav ari
ableevaluati
onist heresultofsome
form ofmeasur ement ,i
ti ssomet imesr eferred to asa quant it
ative cl
assif
icati
on
met hod.Anat t
ri
but eeval
uat i
onissomet imesr eferr
edt oasaqual it
at i
veclassi
fi
cat i
on,
since the response is notmeasur ed.Because i tis a measur ement ,a variable
classifi
cat
iontypicall
yprovidesmor ei nfor
mat i
onaboutt hepr oduct—thewei ghtofa
productismor einformati
vet hansimplysay i
ngt heproductisgoodorbad.

7.
6.3SPSAppl
i
edt
oSer
vices
Cont rolchar t
shav ehi stori
call
ybeenusedt omoni torthequal it
yofmanuf act
uri
ng
processes.Howev er,SPC i sjustasusef ulformoni tori
ng quali
tyi nser vi
ces.The
diff
erence i st he natur e oft he “
defect”being measur ed and moni t
ored.Using
Mot orola’s defi
nit
ion—a f ail
ureto meetcust omerr equir
ementsi n anypr oductor
service—adef ectcanbeanempt ysoapdi spenserinar estr
oom oraner rorwitha
phonecat al
ogueor der,aswel lasablemishonapi eceofclothoraf aultytr
ayonaDVD
player.Cont rolchartsf orser v
iceprocessestendt ousequal it
ychar act
erist
icsand
measur ement s such as t i
me and cust omersat i
sfacti
on (determined by surveys,
quest ionnai
res,orinspections)

7.7.Int
er nati
onalQualit
ySt andardDocument ati
on
7.7.1 TheMal colm Bal
dr i
geNat i
onal Qualit
yAwar d(MBNQA)
TheMal colm Baldri
geNat ionalQualit
yAwar dwasest abl
ishedin1987,whenCongr ess
passedt heMal col
m Bal drigeNationalQual i
tyImprovementAct .Theawardi snamed
afterthef ormerSecr et
ar yofCommer ce,Malcolm Baldr
ige,andisint
endedtor eward
andst imul at
equal i
tyini
tiativ
es.Itisdesi gnedt orecognizecompaniesthatestabli
sh
anddemonst rat
ehi ghqual i
tystandar ds.Theawar di sgivent onomor et hant wo
compani esi neachoft hr eecategories:manuf acturi
ng,servi
ce,andsmal lbusiness.

12
Pastwi
nner
sincl
udeMot
orol
aCor
por
ati
on,
Xer
ox,
FedEx,
3M,
IBM,
andt
heRi
tz-
Car
lt
on.
Tocompet ef ortheBaldri
geAwar d,companiesmustsubmi tal engthyappli
cati
on,
whichisfoll
owedbyani nit
ialscr
eening.Companiesthatpasst hisscreeni
ngmov eto
thenextst ep,inwhichtheyunder goar igor
ousev aluat
ionpr ocess,conductedby
cer
tifiedBaldri
geexaminer
s.Theexami nersconductsit
ev i
sit
sandexami nenumerous
companydocument s.Theybasetheireval
uati
ononsev encategor i
es,whichareshown
i
ntablebelow

Cat
egor
ies Poi
nts

Leader
shi
p 120

St
rat
egi
cpl
anni
ng 85

Cust
omerandmar
ketf
ocus 85

I
nfor
mat
ionandanal
ysi
s 90

Humanr
esour
cef
ocus 85

Pr
ocessmanagement 85

Busi
nessr
esul
t 400

Tot
alpoi
nt 1000

7.
7.2 TheDemi
ngPr
ize
TheDemi ngPri
zei saJapaneseawar dgivent ocompani est orecognizetheireff
ortsi
n
qualit
yimprovement .Theawar disnamedaf terW.Edwar dsDemi ng,whov isit
edJapan
afterWorldWarI Iupont her equestofJapanesei ndustrialleadersandengi neers.While
there,hegaveaser iesofl ecturesonqual i
ty .TheJapaneseconsi deredhi m suchan
i
mpor t
antquali
tygurut hattheynamedt hequal i
tyawardaf terhim.Theawar dhasbeen
given by the Uni on ofJapanese Sci ent
ists and Engi neers( JUSE)si nce 1951.
Compet it
ionfortheDemi ngPr izewasopenedt oforeigncompani esi n1984.I n1989
Flori
daPower&Li ghtwast hef i
rstU.S.Companyt oreceivet heawar d.
TheEur opeanQualit
yAwar disEur
ope‘
smostprest
igi
ousawardf ororgani
zat
ional
excellence.TheEuropeanQual
it
yAwardsi
tsatt
hetopofregi
onalandnati
onalquali
ty
awar ds,andappli
cantshaveoft
enwononeormoreofthoseawardspri
ortoapplyi
ng
fortheEur opeanQuali
tyAwar
d.

13
7.
7.3I
SO9000St
andar
ds
Increasesi ninternationaltradedur i
ngt he1980scr eatedaneedf orthedev el
opmentof
uni v
ersalst andardsofqual it
y .Uni versalstandar dswer eseenasnecessar yi nor derfor
compani est obeabl et oobject ivelydocumentt heirquali
t ypracti
cesar oundt hewor l
d.
Theni n1987t heInter nati
onalOr ganizationf orSt andardizati
on( I
SO)publ ishedi tsfi
rst
set of st andards f or qual i
ty management cal l
ed ISO 9000.The I nternati
onal
Or ganizati
onf orStandar di
zation( I
SO)i sani nternationalorganizati
onwhosepur poseis
toest ablishagr eementoni nter nati
onalqual i
tyst andards.I tcurrentlyhasmember s
from 91count ri
es,incl udi
ngt heUni tedSt at es.Todev elopandpr omot ei nternati
onal
qual i
tystandar ds,ISO9000hasbeencr eated.I SO9000consi stsofasetofst andards
and a cer tif
icati
on pr ocess f orcompani es.By r eceiving ISO 9000 cer ti
fi
cati
on,
compani esdemonst r atethatt heyhav emett hest andardsspeci fi
edbyt heI SO.The
standar dsar eapplicabl etoal lty pesofcompani esandhav egainedgl obalaccept ance.
Inmanyi ndust ri
esISOcer ti
ficationhasbecomear equir
ementf ordoi ngbusi ness.Also,
ISO9000st andardshav ebeenadopt edbyt heEur opeanCommuni tyasast andar dfor
compani esdoi ngbusi nessi nEur ope.
I
nDecember2000thef i
rstmajorchangest
oISO 9000wer
emade,i
ntr
oduci
ngt
he
f
oll
owi
ngt
hreenewstandards:

 I
SO 9000: 2000–QualityManagementSy stems–Fundament
alsandStandar
ds:
Providestheterminologyanddent
it
ionsusedi nthest
andar
ds.I
tist
hestart
ing
pointforunderst
andingthesyst
em ofstandards.

 ISO 9001:2000–Quali
ty Management Syst
ems–Requi
rement
s:Thisi sthe
standardusedforthecert
if
icat
ionofafirm‘squal
i
tymanagementsy
stem.I
tis
usedt odemonstratetheconformi
tyofqual
it
ymanagementsyst
emst omeet
customerrequi
rements.

 I
SO 9004:2000–Qual
it
y ManagementSy stems–Guidel
i
nes f
orPerfor
mance:
Provi
desguidel
i
nesforestabl
i
shingaqualit
ymanagementsystem.I
tfocuses
notonlyonmeeti
ngcustomerrequi
rement
sbutalsoonimpr
ovi
ngperf
ormance.

Thesethreestandar
dsar ethemostwi del
yusedandappl
ytothemajor
it
yof
companies.However
, t
enmor epubl
ishedst
andar
dsandgui
del
i
nesexi
staspar
t
oftheI
SO9000f amilyofstandar
ds.

Tor eceiv
eI SOcer ti
fication,acompanymustpr ovideextensivedocument ati
on
ofi ts quali
ty processes.Thi si ncl
udes met hods used t o moni t
orqual i
ty,
met hods and f requency of wor ker tr
aini
ng,j ob descr i
pti
ons,i nspecti
on
programs, and st ati
st i
cal process-contr
ol t ool
s used. Hi gh-qual
it
y
document ationofal lpr ocessesiscr i
ti
cal.Thecompanyi sthenaudi tedbyan
ISO9000r egist
rarwhov isi
tsthefacil
it
ytomakesur ethecompanyhasawel l-
document ed qualitymanagementsy stem and t hatt he process meet sthe
standards.Iftheregistrarf i
ndsthatall
isinorder,certi
fi
cati
onisr ecei
ved.

14
 Onceacompanyiscert
if
ied,iti
sregist
eredinanISOdir
ect
oryt hatl
ist
scer
tif
ied
compani
es.The enti
re process can take 18 t
o 24 months and can cost
anywher
efrom $10,
000t o$30,000.Compani eshavetober e-cer
ti
fiedbyISO
ever
ythr
eeyear
s.
Oneoftheshor t
comingsofISOcerti
fi
cati
oni sthatitf
ocusesonlyont heprocessused
andconformancet ospeci
fi
cati
on.IncontrasttotheBal dr
igecri
teri
a,ISOcer t
if
icat
ion
doesnotaddressquesti
onsabouttheproductitsel
fandwhet heri
tmeet scustomerand
marketrequir
ements.Todayther
eareov er40,000compani esthatareISOcer ti
fi
ed.In
fact
,cer
tif
icat
ionhasbecomear equi
rementf orconducti
ngbusinessinmanyi ndustr
ies.
7.
7.4I
SO14000St
andar
ds
Theneedf orst
andardi
zati
onofqual i
tycreatedanimpet usfort
hedevelopmentofot
her
standards.I
n1996t heInter
nationalStandardsOrganizati
onintr
oducedstandar
dsfor
evaluat
ing acompany‘senv i
ronment alresponsi
bil
it
y.Thesest andards,ter
med I
SO
14000,focusonthr
eemaj orareas:

 Managementsyst
emsst andardsmeasur
esy stemsdevel
opmentandi
ntegr
ati
on
ofenv
ironment
alr
esponsibi
li
tyint
otheover
allbusi
ness.

 Oper
ations st
andards i
ncl
ude t
he measur
ementofconsumpt
ion ofnat
ural
r
esourcesandenergy.

 Envi
ronmentalsystems standards measur e emissi
ons,effluent
s,and other
waste syst
ems.Wi t
h greater int
erest in green manufact
uri
ng and mor e
awarenessofenvi
ronmentalconcerns,ISO14000maybecomeani mpor
tantset
ofst
andardsforpromoti
ngenv i
ronment al
responsibi
li
ty.

15