04 Handout 1 (47) Merged

BM2408
TQM TOOLS AND TECHNIQUES IN OPERATIONS MANAGEMENT

TQM tools and techniques in operations management play a vital role in enhancing the quality, efficiency, and
productivity of business processes. They hold utmost significance in today’s business landscape as
organizations must consistently pursue excellence and fulfill customer expectations. The utilization of TQM
tools serves the purpose of identifying and eliminating defects, minimizing waste, and steadily enhancing
operations. Through the implementation of these methodologies, organizations can elevate customer
satisfaction, bolster competitiveness, and attain sustainable growth (Luther, 2024).
Failure Mode and Effects Analysis (ASQ, 2023)

Failure Mode and Effects Analysis (FMEA) is a systematic method for evaluating and improving the reliability
of a product or process by identifying potential failure modes and their effects. It is used to identify and
mitigate risks associated with design and processes proactively. FMEA involves identifying failure modes,
evaluating the severity of their effects, determining their likelihood of occurrence, and assessing the
effectiveness of current controls.
This analysis can be performed at various stages of product development, including design, production, and
service. FMEA helps to prioritize areas for improvement, reduce the likelihood of failures, and enhance overall
product or process reliability. It is widely used across industries such as automotive, healthcare, aerospace,
and manufacturing to prevent and mitigate potential failures.
Figure 1: Failure Mode and Effects Analysis

Source: www.velaction.com
04 Handout 1 *Property of STI

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Using FMEA in Business Operations

The bank has conducted a thorough FMEA process on its ATM system. During this analysis, the bank identified
that the majority of customer complaints are focused on the crucial function of "dispensing cash." According
to their analysis, "machine jams" and "heavy computer network traffic" are identified as the top two highest
risks. Upon reviewing customer feedback, the bank was able to identify the severity, occurrence, and
detectability of this problem. To determine the most appropriate priorities for addressing these risks, the team
relied on their expertise and judgment, combining their experience with the relevant FMEA data (ASQ, 2023).
Description Potential Failure Potential Root Cause S O D RPN Action S O D RPN

Mode Effects of
Failure
Customer Does not dispense Dissatisfied Out of Cash 8 5 5 200 Internet-
withdraw cash customer low cash
cash from alert
the ATM
Incorrect Machine jams 3 10 240 Internal jam
entry to alert
demand
deposit
system
Discrepancy Power failure 2 10 160 None
in cash during
balance transaction
Dispense too Bank loses Bills stuck 6 2 7 84 Loading
much cash money together procedure
riffle ends
of a stack
Discrepancy Denominations 3 4 72 Two-person
in cash in the wrong visual
balance tray verification
Takes too long to Annoyed Heavy 3 7 10 210 None
dispense cash customer computer
network traffic
Power 2 10 60 None
interruption
during a
transaction
Figure 2: Failure Mode and Effects Analysis
Source: https://asq.org/quality-resources/fmea
Using the collected data, the team calculates a Risk Priority Number (RPN) for each failure mode by
multiplying the severity, occurrence, and detectability scores. The higher the RPN, the higher the priority the
company assigns to addressing that failure mode. Based on the results, the company develops action plans to
reduce or eliminate high-risk failure modes.

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How to use FMEA

1. Define the scope and goals of the FMEA.
2. Identify potential failure modes for the system or process being analyzed.
3. Assess the severity of each failure mode, considering the impact it would have if it occurred.
4. Determine the occurrence of each failure mode, considering factors such as frequency and
predictability.
5. Evaluate the detectability of each failure mode, considering its ability to be detected, prevented, or
mitigated.
6. Calculate the Risk Priority Number (RPN) for each failure mode by multiplying severity, occurrence,
and detectability scores.
7. Develop and implement appropriate actions to mitigate or eliminate high-priority failure modes.
8. Continuously monitor and evaluate the actions taken by computing the severity, occurrence, and
detectability scores.
Benefits of Using FMEA

• Anticipates and mitigates potential failures: FMEA helps identify potential failure modes in a process
or system and evaluates their potential effects, allowing for proactive measures to be taken to prevent
or mitigate these failures.
• Enhances product or process design: By detecting potential failure modes early in the design stage,
FMEA enables improvements to the design to enhance reliability and performance.
• Improves decision-making: FMEA provides a structured approach for analyzing failures and their
effects, which aids in making informed decisions about prioritizing improvements or corrective
actions.
Statistical Process Control (Sharma, 2024)

Statistical Process Control (SPC) is an industry-standard methodology for measuring and controlling quality
during the manufacturing process to enable continual improvement.
Figure 3: Statistical Process Control (SPC)

Source: https://www.researchgate.net/ Statistical-Process-Control-SPC

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The following factors determine the degree of process conformity or non-conformity:

• Quality of conformance. This refers to a manufacturing state in which the product fully conforms to
its intended design and characteristics.
• Chance variation/Random variation. This refers to a manufacturing state where the product differs
in design and characteristics due to the combined natural influences in the production process. For
instance, the use of older machines may generally exhibit a higher degree of variability to the output,
in comparison to the use of newer machines that may have incorporated design improvements that
lessen the variability of the output.
• Assignable variation/Nonrandom variation. This refers to a manufacturing state where the product
differs in design and characteristics due to an identifiable cause that can be easily eliminated. The
typical sources of assignable variation include equipment that needs adjustment, defective materials,
or human sources such as carelessness, fatigue, and incapacity to perform assigned tasks.
Using SPC in Business Operations

Intel Technology Philippines Inc. utilizes Statistical Process Control (SPC) as a tool to oversee the production
process and guarantee the quality of their electronic components meets and exceeds industry standards. This
approach enables them to continually supervise and regulate their manufacturing operations, ensuring
that all processes operate within the desired specifications and yield exceptional products of utmost quality.
By gathering and analyzing data in real time, statistical process control empowers Intel to swiftly detect any
deviations or patterns that might suggest potential defects or inefficiencies in their processes. , they can take
proactive measures and promptly make any necessary adjustments, thereby preventing quality concerns and
enhancing overall production efficiency.
How to use SPC

1. Define the process and identify the critical quality characteristics.
2. Collect data on the critical quality characteristics over a period.
3. Plot the data on a control chart to visualize the process variation.
4. Calculate the upper control limit (UCL) and the lower control limit (LCL).
5. Monitor the process data and plot new data points on the control chart.
6. Analyze the control chart to identify trends, patterns, or points outside the control limits.
7. Take appropriate action if any points are outside the control limits or if there are significant trends or
patterns.
8. Continuously collect and monitor data, updating the control chart as new data becomes available.
9. Conduct periodic reviews and analyses of the control chart to assess process stability and capability.
10. Make necessary improvements in the process to ensure consistent quality and reduce process
variation.
Sample Computation:
Consider a manufacturing plant that produces bottles. The quality control team wants to monitor the filling
process to ensure consistent results. They collect data on the bottle fill volumes for a week, obtaining the
following measurements: 200 mL, 195 mL, 205 mL, 198 mL, 202 mL, 200 mL, and 203 mL.
To compute the mean (μ), add the values and divide by the number of data points: (200 + 195 + 205 + 198 +
202 + 200 + 203) / 7 = 200.

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To compute the standard deviation (σ), calculate the average deviation from the mean:
• Subtract the mean from each data point: (200-200), (195-200), (205-200), (198-200), (202-200), (200-
200), (203-200).
• Square each deviation: 0, 25, 25, 4, 4, 0, 9.
• Sum all squared deviations: 0 + 25 + 25 + 4 + 4 + 0 + 9 = 67.
• Divide the sum by the number of data points minus 1: 67 / (7-1) = 11.16.
• Take the square root of the result: √11.16 ≈ 3.34.
For control limits, assuming a desired level of significance, commonly set at ±3 standard deviations:
• Upper Control Limit (UCL) = μ + (3 x σ) = 200 + (3 x 3.34) = 200 + 10.02 ≈ 210.02 mL.
• Lower Control Limit (LCL) = μ - (3 x σ) = 200 - (3 x 3.34) = 200 - 10.02 ≈ 189.98 mL.
Therefore, the mean fill volume is 200 mL, the standard deviation is approximately 3.34 mL, the upper control
limit is around 210.02 mL, and the lower control limit is roughly 189.98 mL.
Benefits of Using SPC

• Improved quality: SPC helps detect and correct variations in the production process, leading to better-
quality products and reduced defects.
• Cost savings: SPC can help organizations save money and resources by minimizing waste, rework, and
defects.
• Decision-making: SPC provides real-time data for monitoring processes, allowing for informed and
timely decisions about process adjustments.
• Customer satisfaction: With better quality products, SPC can contribute to higher customer
satisfaction and loyalty.
• Continuous improvement: SPC fosters a culture of continuous improvement by identifying areas for
enhancement and facilitating data-driven decision-making for process optimization.
Six Sigma Methodology (Kumar, 2024)

This approach improves production processes to make a company more competitive, profitable, and
successful. Its benefits include cost reduction, productivity improvement, market-share growth, and customer
retention.
Figure 4: Six Sigma Methodology

Source: https://trainingheights.com/six-sigma-certification-in-nigeria/

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How to Use Six Sigma

1. Define: Objectives and goals are determined in this phase, with a focus on comprehending customer
requirements, identifying the problem or improvement opportunity, and defining project scope
and limitations.
2. Measure: This phase entails the collection of data and measurement of the current performance of
the process. This involves pinpointing key process metrics, gathering pertinent data, and analyzing the
data to glean insights into process performance.
3. Analyze: The data collected is thoroughly analyzed for the purpose of identifying the root causes of
defects, errors, or variations. A range of statistical and analytical tools are deployed to ascertain
the elements that contribute to process inefficiencies.
4. Improve: Based on the analysis conducted in the previous phase, potential solutions have been
developed and implemented to address the root causes of the identified problems. This phase
emphasizes data-driven improvements to the process and the testing of their effectiveness.
5. Control: This last phase is designed to ensure the stability of the process and the sustainability of the
improvements. This is achieved through the establishment of control mechanisms and standard
operating procedures, which monitor and maintain the improved process performance.
Using Six Sigma in Business Operations

Bank of the Philippine Islands (BPI) applied Six Sigma to their processes and operations to minimize defects
and improve customer satisfaction. BPI utilized Six Sigma's DMAIC (Define, Measure, Analyze, Improve,
Control) approach to identify areas for improvement, gather data, analyze root causes of problems,
implement solutions, and maintain the improvements. This helped the company reduce errors, enhance
operational efficiency, and deliver better quality services. As a result, BPI experienced cost savings, increased
productivity, and higher customer retention, thus solidifying its position in the competitive banking industry.
Benefits of Using Six Sigma

• Risk Reduction: Six Sigma helps in identifying and mitigating potential risks in processes, thereby
reducing the likelihood of errors, accidents, and failures. This leads to increased operational reliability
and minimized business risks.
• Competitive Advantage: Implementing Six Sigma differentiates organizations from their competitors
by ensuring consistent quality and high customer satisfaction. It helps organizations stand out in the
market and gain a competitive edge.
• Employee Engagement: Six Sigma initiatives involve training employees in problem-solving techniques
and statistical tools. This not only improves their skills but also increases their engagement and
motivation by involving them in process improvement efforts.
• Data-Driven Decision Making: Six Sigma relies on data-driven analysis and tools like statistical process
control (SPC) and hypothesis testing. This promotes informed decision-making based on actual data
and facts, reducing subjective decision-making biases.
• Customer Satisfaction: Six Sigma emphasizes understanding customer requirements and aligning
processes accordingly. By prioritizing customer needs, organizations can deliver better products and
services, resulting in an enhanced customer experience and increased loyalty.

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Lean Management Principles (Verma, 2023)

This approach focuses on maximizing customer value while minimizing waste. A lean operation is the process
of developing a better product or service with a minimum number of resources. Lean focuses on reducing and,
ideally, eliminating the following types of waste:
• Overproduction waste. It refers to the excessive manufacturing of a product or delivery of a service.
In a manufacturing setting, this might mean producing 100 parts when only 50 are needed. In a
service setting, it might mean pumping 20 gallons of gas for a customer who wanted only 15.
• Inventory waste. It refers to the excessive inventory stored in a warehouse. In a manufacturing
setting, this might mean having more parts stack up at an assembly station than can be used for a
given production run. In a service setting, this could mean a bookstore carrying more copies of a
given book than it is likely to sell.
• Motion waste. It refers to the unnecessary movement into the production process or in the delivery
of services. In a manufacturing setting, this might mean programming too many motions into a
machine. In a service setting, it might mean having to move around the office several times to
accomplish a single task.
• Defects waste. It refers to the rejected work or rework as the result of production or processing
errors. In a manufacturing setting, an example of a defect would be a faulty part that does not meet
customer specifications. In a service setting, it might mean having to rewrite an insurance policy
because of calculation errors in writing the original policy.
• Waiting waste. It refers to the idle time of people, machines, or processes caused by unavailable
resources. In a manufacturing setting, it might involve an expensive machine and its operator sitting
idly because the parts they are to work on have not been delivered. In a service setting, the classic
example is the airliner idling on the taxiway, waiting for clearance to take off.
• Underutilization waste. It refers to the underuse capabilities of technology or underutilized talents,
skills, and creativity of people. In a manufacturing setting, it might involve failing to include the
people who operate processes in brainstorming sessions aimed at improving the performance of
those processes. In a service setting, it might mean failing to use a sophisticated word processing
system with a visual display monitor.
Figure 5: Lean Management Principles

Source: https://www.planettogether.com/five-principles-of-lean-manufacturing

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How to Use LMP

1. Define Value. This can be achieved through methods such as conducting surveys, interviews, and
other research to uncover what customers find valuable, the optimal delivery approach for products
or services, and identifying an appropriate price point.
2. Map the Value Stream. Assess the workflow and activities of the company to determine their value.
By eliminating any unnecessary waste and minimizing the necessary waste, businesses can enhance
their capacity to fulfill customers' demands and reduce their expenses simultaneously consistently.
3. Create Flow. This can be achieved through the implementation of various strategies, including the
establishment of cross-functional departments, balancing workloads, breaking down steps, and
training employees to be multi-skilled, among others.
4. Establish Pull System. The primary objective is to manufacture products precisely when they are
required, in the desired quantity, and delivered promptly, commonly known as 'just in time'
delivery. This methodology enhances resource capacity optimization and assists organizations in
meeting customers' demands while simultaneously minimizing waste.
5. Pursue Perfection. This step is important for integrating continuous process improvement and lean
thinking into the organization's culture. It plays a big role in driving the business towards perfection
and constant improvement.
Using LMP in Business Operation

Ayala Land Incorporated is an example of a Philippine company that uses lean management principles. The
company applies lean management in its construction processes to improve efficiency and reduce waste. Ayala
Land uses lean construction methods, such as Just-in-Time (JIT) delivery of materials, which ensures materials
are delivered to the construction site only when needed, minimizing storage and inventory costs. They also
implement Value Stream Mapping (VSM) to identify and eliminate non-value-added activities, improving
workflow and reducing lead times. This approach helps Ayala Land minimize project delays and cost overruns.
Benefits of Using LMP

• Sustainability: Lean management focuses on reducing waste and conserving resources. This aligns
with sustainable practices, such as reducing energy consumption, minimizing environmental impact,
and promoting a responsible approach to business operations.
• Flexibility and Adaptability: Lean management promotes a flexible and adaptable work
environment. Through practices like just-in-time inventory management and cross-functional teams,
organizations can respond efficiently to changes in customer needs and market demands.
• Improved Efficiency: Lean management eliminates waste and focuses on streamlining processes. By
reducing unnecessary steps, time, and resources, it increases overall efficiency and productivity.
• Cost Reduction: By eliminating waste, lean management helps reduce costs associated with
unnecessary inventory, overproduction, and over-processing. This leads to better financial
performance for the organization.

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Pareto Analysis (Krajewski, 2024)

Pareto analysis is a technique used to prioritize and focus on the most important factors. It is based on the
Pareto principle, which states that 80% of the effects come from 20% of the causes. The analysis involves
identifying the most significant factors that contribute to a particular outcome or problem. It helps in
determining where efforts should be concentrated to achieve the greatest impact. It was proposed by Vilfredo
Pareto, a nineteenth-century Italian scientist whose statistical work focused on inequalities of data.
The Pareto Principle states that eighty percent of activity is caused by twenty percent of the factors. It is also
known as the “80–20 rule.” The principle suggests that managers must concentrate on twenty percent of the
factors to eliminate eighty percent of the organizational problems.
Using the Pareto Principle in Business Operation

The manager of a neighborhood restaurant is concerned about the low number of customers patronizing his
eatery. Complaints have been rising, so he would like to find out the issues to address and present the findings
in a way his employees can understand. The manager surveyed his customers over several weeks and collected
the following data:
Customer Complaints Frequency

Impolite server 12
Slow service 42
Cold dinner 5
Cramped tables 20
Atmosphere 10
Figure 6: Frequency of customer complaints
Source: Operations Management: Process and Supply Chains, 14th Edition, p. 91

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50 120%
100%
Percent of Total
40
80%
30
Frequency
60%
20
40%
10 20%
0 0%
Slow Cramped
Service Tables Impolite Atmosphere Cold
server Dinner
Customer Complaints
Frequency Percent of Total
Figure 7: Customer complaints
Figure 6 presents the data in a way that shows which complaints are more prevalent. To solve for the
percentage of prevalent complaints, add and get the average of the two (2) most dominant complaints and
multiply it by 100%. Based on the given data, the two (2) most dominant complaint accounts for slow service
and cramped tables with data frequencies of 42 and 20, respectively.
= (42 + 20)/ 89 × 100% = 69.7%
It was clear to the manager which complaints if rectified, would cover most of the process failure problems
in the restaurant. First, slow service will be addressed by training the existing staff, adding another server,
and improving the food preparation process. Removing some decorative furniture from the dining area and
spacing the tables better will solve the problem of cramped tables. The Pareto Chart shows that these two
(2) problems, if rectified, will account for almost 70% of the complaints.
Benefits of Using Pareto Analysis

• Risk management: Pareto analysis can be used to identify the most significant risks or hazards that
may impact business operations, allowing businesses to address them and minimize potential
disruptions proactively.
• Cost reduction: By addressing the main causes of problems or waste, Pareto analysis helps reduce
costs associated with inefficiencies, errors, or unnecessary activities.
• Identifying the vital few: It helps to identify and focus on the most critical problems or factors that
have the highest impact on overall performance.
• Prioritizing actions: Prioritization is crucial. Pareto analysis provides a framework for making informed
decisions about which issues to address first, enabling businesses to take effective actions and achieve
quick wins.

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Root Cause Analysis (Krajewski, 2024)

Root Cause Analysis relates a key performance problem to its potential causes. It is used to identify and isolate
the causes of a problem. Because of its structure, it is sometimes called the “fishbone diagram.” It was
developed by Kaoru Ishikawa, a Japanese quality expert, so sometimes the diagram is also called the “Ishikawa
Diagram.”
Using Root Cause Analysis in Business Operation

A process improvement team is working to improve the production output at the Johnson Manufacturing
Plant’s Header Cell, which manufactures a key component: headers used in commercial air conditioners. A
header is part of a commercial air conditioner's circulatory system, moving coolant between various
components, such as the evaporator coil and the condenser coil.
Currently, the header production cell is scheduled separately from the main work in the plant. Often, individual
headers are not sequenced according to their counterparts in the final assembly line in a timely manner, so
the product can sit in a queue waiting for a header. Steps within the cell are followed by the transport of the
finished header to the air conditioner assembly area for installation into an air conditioner unit.
The six (6) processing steps include the following:

1. Cutting copper pipes to the appropriate length.
2. Punching vent and stubbing holes into the copper log.
3. Welding a steel supply valve onto the top of the copper log.
4. Brazing end caps and venting plugs to the copper log.
5. Brazing stub tubes into each stub hole in the copper log.
6. Adding plastic end caps to protect the newly created header.
To analyze all the possible causes of the problem, the team constructed a root cause analysis shown in Figure
7 below. The main problem, Inadequate Header Production, is the diagram’s head. The team brainstormed
possible causes and collectively identified several major categories: Management, manpower, method,
measurement, machine, and materials, or the six (6) M’s. Several suspected causes were identified for each
major category.
Figure 8: Fishbone Diagram of Johnson Manufacturing Plant’s Header


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The improvement team noted several immediate issues that were slowing down the production of headers.
These issues included operators batching individual jobs (method branch) into groups to save walking time,
which was further exasperated by the availability of raw materials stocked on the shop floor (materials
branch) and the lack of specific job requirements (management branch). Furthermore, there were many
instances of individual tasks not being done correctly and thus having to be redone, such as the 90% rework
rate at weld (method branch). The next step in this process improvement was to eliminate the raw material
on the floor, improve quality at the welding machine, and move each header individually using a header-
specific cart.
Benefits of Using Root Cause Analysis

• Prevention of recurring problems: By addressing the root causes, organizations can implement
effective preventive measures to avoid recurring problems in the future. This helps save time,
resources, and efforts that would have otherwise been spent dealing with repetitive issues.
• Increased efficiency and productivity: By addressing the root causes of problems, organizations can
streamline their processes, remove bottlenecks, and improve overall efficiency. This results in
increased productivity and optimized resource utilization.
• Facilitates learning and knowledge sharing: Root cause analysis involves analyzing data and gathering
information from various sources. This fosters a culture of learning and knowledge sharing within
teams and organizations, where insights gained from root cause analysis can be shared and utilized
for future problem-solving.
Kaizen Events (Meissner, 2024)

“Kaizen” is the name given by the Japanese to the concept of continual incremental improvement. “Kai” means
“change,” and “zen” means “good.” The underlying value system of Kaizen can be summarized as continual
improvement of all things, at all levels, all the time. Each member of the organization plays an important role
in the implementation of Kaizen as follows:
• Role of executive management. Executive managers are responsible for establishing Kaizen as the
organization's corporate strategy and for establishing systems, procedures, and structures that
promote it.
• Role of middle managers. Middle managers are responsible for implementing the Kaizen policies
established by executive management and ensuring that employees receive the training necessary to
understand and implement Kaizen.
• Role of supervisors. Supervisors are responsible for applying the Kaizen approach in their functional
roles by developing plans, improving communication, maintaining morale, providing coaching for
teamwork activities, and soliciting Kaizen suggestions from employees.
• Role of employees. Employees are responsible for participating in Kaizen by taking part in teamwork
activities, engaging in continual self-improvement activities, and enhancing job skills through
education and training.

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Figure 9: The Six-Step Cycle of Kaizen

Source: https://kanbanzone.com/resources/lean/kaizen/
How to Use Kaizen

1. Identify problems: Start by identifying specific areas or processes within your organization that can
be improved. This could include anything from reducing waste or improving productivity.
2. Analyze current processes: Once you have identified an area for improvement, analyze the current
state of the process. This involves gathering data, observing the process, and understanding the root
causes of any issues.
3. Create Solutions: Based on the analysis, develop a detailed plan for improvement. This plan should
outline the specific actions needed to address the identified issues.
4. Test the Solutions: Implement the proposed improvements to put the plan into action. This may
involve assigning responsibilities, providing necessary resources, and communicating the changes to
the relevant stakeholders.
5. Measure and Analyze Result: Once the improvements have been implemented, review the results to
determine if the desired outcome has been achieved. This involves collecting data and evaluating the
impact of the changes.
6. Standardize the Solution: Finally, establish standard procedures and practices based on the successful
changes made. This ensures that the improvements become part of the regular operations and
encourages ongoing improvement efforts.
Using Kaizen Events in Business Operations

Toyota Motor Philippines Corporation (TMP) adopts Kaizen events to enhance their production processes and
boost efficiency continuously. Regular Kaizen events are conducted throughout various sectors of their
operations, including assembly lines, logistics, and supply chains. By fostering cross-functional collaboration,
TMP employees collectively identify areas with potential for improvement, analyze current processes, and
devise solutions to eliminate waste and heighten productivity. Swift implementation of small-scale changes,
often within a week, allows for rapid testing of these enhancements. Through the utilization of Kaizen events,
TMP strives to consistently achieve successive improvements over time, ultimately resulting in the delivery of
superior quality products, reduced lead times, and lowered costs.

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Benefits of Kaizen:
• Reduced Lead Time: It aims to reduce lead time through the streamlining of processes and elimination of
non-value-adding activities, which improves responsiveness to customer needs.
• Culture of Excellence: It fosters a culture of excellence and a mindset of always seeking better ways of
doing things, leading to sustained improvement and innovation.
• Cost Savings: By focusing on efficiency and waste reduction, Kaizen leads to significant cost savings in
production and operations
Total Productive Maintenance (Besterfield, 2024)

Total Productive Maintenance (TPM) is a proactive approach to maintenance that aims to maximize
equipment productivity and efficiency. It involves empowering operators to take responsibility for their
equipment's maintenance. TPM focuses on preventing breakdowns and improving overall equipment
effectiveness (OEE). The key elements of TPM include autonomous maintenance, planned maintenance,
quality maintenance, and focused improvement.
TPM aims to create a culture of ownership and continuous improvement within an organization. By
implementing TPM, companies can reduce downtime, improve equipment reliability, and optimize their
overall production process.
How to Use TPM

1. Set clear goals: Define the objectives of TPM, such as maximizing equipment uptime and reducing
maintenance costs.
2. Create a TPM team: Form a cross-functional team consisting of operators, maintenance personnel,
and management representatives.
3. Implement autonomous maintenance: Train operators to conduct routine maintenance tasks like
cleaning, inspection, and lubrication. This helps identify potential issues early on and empowers
operators to take care of their equipment.
4. Conduct planned maintenance: Develop a preventive maintenance program based on equipment-
specific requirements and manufacturer recommendations. Schedule regular inspections, repairs, and
replacements.
5. Initiate early equipment management: Create a system to monitor equipment condition and
performance using tools like vibration analysis, infrared thermography, or oil analysis. Implement
predictive maintenance techniques to detect and address problems before they cause failures.
6. Train and educate employees: Provide comprehensive training on TPM methodologies, focusing on
improving operational and maintenance skills. Raise awareness about the importance of TPM and
foster a culture of continuous improvement.
7. Implement quality maintenance: Incorporate quality management principles into TPM to ensure that
maintenance processes align with customer requirements and product quality standards.
8. Focus on continuous improvement: Establish regular review meetings to discuss maintenance issues,
feedback, and improvement opportunities. Use tools like root cause analysis and Kaizen events to
identify and eliminate sources of waste, downtime, and defects.

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9. Practice total employee involvement: Encourage all employees to participate in TPM activities and
share their ideas for improvement. Foster a sense of ownership and responsibility for equipment
maintenance.
10. Monitor and measure progress: Regularly track Key Performance Indicators (KPIs), such as equipment
uptime, maintenance costs, and employee involvement. Use the data to identify areas for
improvement and adjust TPM activities accordingly.
Using TPM in Business Operations

One company that uses Total Productive Maintenance (TPM) is San Miguel Corporation, a diversified
conglomerate that operates in the food and beverage, packaging, power, fuel and oil, and infrastructure
industries. San Miguel Corporation implemented TPM across its manufacturing facilities to optimize
equipment efficiency, reduce breakdowns, and improve overall productivity. They have integrated TPM into
their operations by focusing on proactive and preventive maintenance, involving cross-functional teams in
equipment management, and promoting a culture of continuous improvement. The implementation of TPM
has helped San Miguel Corporation reduce equipment downtime, minimize production losses, and enhance
the overall equipment effectiveness, leading to improved operational efficiency and cost savings.
Benefits of Using TPM

• Better Asset Utilization: By minimizing equipment breakdowns and losses, TPM helps in maximizing
the utilization of production assets.
• Greater Predictability: TPM can lead to more predictable and consistent equipment performance,
allowing for better production planning and scheduling.
• Improved Safety: A well-implemented TPM program can address safety issues and promote a safer
working environment by identifying and resolving potential hazards.
• Enhanced Overall Equipment Effectiveness (OEE): TPM strives to boost OEE by targeting availability,
performance, and quality losses, thereby increasing overall productivity.
Design of Experiments (Jacobs, 2024)

Design of Experiments (DOE) is a systematic approach used to determine the relationship between different
factors and their impact on a process or outcomes. By identifying significant factors and their interactions,
DOE helps optimize processes and improve the quality of products or services.
DOE involves planning and conducting experiments, analyzing the data, and drawing conclusions to make
informed decisions. It allows for efficient experimentation by systematically varying the factors instead of
testing all possible combinations. The results obtained from DOE can be used to predict the impact of factors
on the process or outcomes. It is a powerful tool for process improvement and decision-making in various
industries.

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Figure 10: Design of Experiments

Source: https://www.isixsigma.com/design-of-experiments-doe/design-experiments
How to Use DOE

1. Identify the problem or question you want to investigate.
2. Determine the factors that may influence the outcome of the experiment.
3. Define the levels or settings for each factor.
4. Select the appropriate DOE design, such as full factorial, fractional factorial, or response surface.
5. Randomize the order or sequence of experiments.
6. Conduct the experiments according to the selected design.
7. Collect and record the data.
8. Analyze the data using statistical methods, such as analysis of variance (ANOVA) or regression
analysis.
9. Identify significant factors and their effects on the outcome.
10. Conclude and make recommendations based on the results of the experiment.
Using DOE in Business Operation

Coca-Cola utilizes experiment design to optimize its products' formulation and production processes. By
conducting experiments that examine various ingredient combinations, process parameters, and packaging
designs, the company can pinpoint the most cost-effective and efficient methods for creating superior
products. This approach not only reduces production costs but also enhances product quality and minimizes
production time. As a result, customer satisfaction is heightened, and the company's competitive edge in the
market is strengthened.
Benefits of Using DOE

• Faster problem-solving: DOE facilitates the identification of significant factors and their interactions,
accelerating the problem-solving process.
• Predictive capability: Based on the experimental results, DOE enables the development of predictive
models for process or product behavior, aiding in future decision-making.
• Efficient troubleshooting: DOE can expedite troubleshooting efforts by systematically identifying the
root causes of issues and guiding corrective actions.
• Improved insight: DOE provides a systematic approach to understanding the impact of multiple
factors on a process or product, leading to deeper insights and better decision-making.

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Quality Function Deployment (Shafer, 2024)

Quality Function Deployment (QFD) is a structured approach to product development that aims to ensure
customer needs and expectations are met. It involves translating customer requirements into specific design
elements and production processes. QFD integrates the customer's voice into all stages of product
development to improve quality and customer satisfaction. The process typically involves cross-functional
teams collaborating to prioritize customer needs and implement them into the product design and production.
Figure 11: Quality Function Deployment

Source: https://www.sciencedirect.com/topics/engineering/quality-function-deployment
QFD helps companies understand and prioritize customer requirements by using methods such as house of
quality, prioritization matrices, and decision matrices. It facilitates the creation of a product that meets or
exceeds customer expectations while also improving internal processes and quality. QFD has been widely used
in industries such as manufacturing, automotive, and consumer goods to enhance customer focus and product
quality.
How to Use QFD

1. Identify customer needs and expectations.
2. Identify product features that correspond to customer needs.
3. Prioritize customer needs and product features.
4. Develop a relationship matrix to link customer needs with product features.
5. Evaluate technical requirements for each product feature.
6. Develop a house of quality to translate customer needs into specific technical requirements.
7. Design products or services based on the house of quality.
8. Continuously update and refine the QFD process based on feedback and new information.

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Using QFD in Business Operation

Shangri-La incorporates Quality Function Deployment (QFD) in its hotel operations by aligning customer
requirements with different aspects of the hotel experience, such as room amenities, dining options, and
customer service. The company uses QFD to prioritize customer needs and preferences and then translates
them into specific design and service requirements for each hotel location. This approach helps the company
to enhance customer satisfaction, improve operational efficiency, and maintain a competitive edge in the
hospitality industry.
Benefits of Using QFD

• Reduction in design and production time: By integrating cross-functional teams and utilizing QFD
methodologies, organizations can streamline their design and production processes, reducing time-
to-market for new products.
• Cost savings: QFD helps in identifying unnecessary features or functions that do not add value to the
customer, allowing organizations to eliminate them and reduce production costs.
• Increased competitiveness: By continuously improving product design and effectively meeting
customer needs, organizations can gain a competitive advantage in the market.
• Efficient resource allocation: QFD facilitates effective resource allocation by ensuring that resources
are directed toward meeting customer requirements and expectations.
5S Methodology (Besterfield, 2024)

The 5S methodology is a system for organizing and maintaining a clean and efficient work environment. It
helps reduce waste, improve productivity, and enhance safety. It involves removing unnecessary items,
logically arranging necessary items, ensuring cleanliness and hygiene, establishing standard procedures, and
maintaining the system on an ongoing basis. The goal of the 5S methodology is to create a visual workplace
that promotes efficiency, effectiveness, and employee satisfaction.
Five-S. It represents Japanese words that describe the steps of a workplace organization process as follows:
• Seiri (Sort). It refers to the practice of distinguishing necessary things and eliminating
unnecessary things in the workplace.
• Seiton (Straighten, Set). It refers to the practice of creating an orderly storage so items can be
located efficiently.
• Seiso (Shine, Sweep). It refers to the practice of maintaining a clean workplace so problems like
leaks, spills, or furniture damage can be more easily identified.
• Seiketsu (Standardize). It refers to the practice of setting up standards for a clean workplace.
• Shitsuke (Sustain). It refers to the practice of supporting behaviors and habits that maintain
organizational standards for the long-term success of the company.
Using 5S Methodology in Business Operation

Jollibee Foods Corporation has strategically integrated the 5S methodology into its operations to enhance
efficiency and productivity. First, the company embraces the "Sort" principle, streamlining work areas and
eliminating unnecessary items to optimize performance. Second, it applies the "Set in Order" principle,
arranging tools and materials logically to reduce waste and improve workflow. Third, Jollibee prioritizes the

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"Shine" principle, ensuring a clean and safe work environment and creating a positive atmosphere. Then, it
focuses on the "Standardize" principle, establishing standard operating procedures to maintain consistency
and quality. Lastly, the company emphasizes the "Sustain" principle, fostering a culture of continuous
improvement.
Benefits of Using 5S Methodology

• Reduction in design and production time: By integrating cross-functional teams and utilizing QFD
methodologies, organizations can streamline their design and production processes, reducing time-
to-market for new products.
• Space utilization: The methodology helps in optimizing the use of available space, leading to better
storage and resource utilization.
• Standardization: 5S promotes setting standards for workplace organization and cleanliness, leading
to a consistent and reliable work environment.
• Cost reduction: The 5S methodology can contribute to cost savings by reducing waste, improving
efficiency, and reducing defects.
• Improved morale: A clean and organized workplace can boost employee morale and satisfaction.
References
ASQ (2023). Failure and Effects Analysis (FMEA). https://asq.org/quality-resources/fmea
Besterfield, D. (2024) Total Quality Management. Pearson
Davis, S. (2024). Total Quality Management: An Integrated Approach. Butterworth-Heinemann Publications
Jacobs, R. (2024). Operations and Supply Chain Management. McGraw-Hill Education
Kumar, P. (2024). What is Six Sigma: Everything You Need to Know About it. https://www.simplilearn.com/what-is-six-sigma-a-
complete-overview-article
Krajewski, L. (2024). Operations Management: Process and Supply Chains, 14th Edition. Pearson
Luther, D. (2024). Operations Management: Processes & Best Practices.
https://www.netsuite.com/portal/resource/articles/erp/operations-management.shtml
Meissner, M. (2024). Critical Factor That Determines the Success of Kaizen Event. https://www.villanovau.com/articles/six-
sigma/kaizen-event-steps/
Sharma, D. (2024). What is Statistical Process Control (And Its Advantage). https://www.indeed.com/career-advice/career-
development/statistical-process-control
Shafer, M. (2024). Operations Management for MBAs. Wiley Publications
Verma, E. (2023). The Five Principles of Lean. https://www.simplilearn.com/5-lean-principles-article
Walkme (2023). What is Total Quality Management (TQM)? https://www.walkme.com/glossary/tqm/

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QUALITY CONTROL AND QUALITY ASSURANCE

Establishing and maintaining high-quality assurance and control are among the most important components
of a successful operation across various industries, whether in manufacturing or service-oriented businesses.
Ensuring and preserving the quality of goods and services is essential for customer satisfaction and retention
(Tarlengco, 2024).
TQM in Service Operations

Service businesses are of great significance as they provide vital support and assistance to individuals and
other businesses. They address a wide range of needs and demands and play a pivotal role in fostering
innovation and addressing evolving challenges in various industries (Davids, 2024).
What is a Service? (George, 2024)

William Edwards Deming asserts that service is a type of intangible product that customers receive in exchange
for payment. Unlike physical offerings, services are non-physical and encompass a broad range of activities,
such as professional assistance and task performance. They are prevalent in sectors such as healthcare,
finance, education, and transportation.
Services differ from goods in that they are often consumed immediately upon production and cannot be stored
or resold. Examples of service offerings include consulting, repair, maintenance, hospitality, banking, and
entertainment. The quality of a service is shaped by factors such as customer experience, satisfaction, and the
ability to meet customers' needs and expectations.
Classification of Services (Shafer, 2024)

As Shafer emphasizes in his book, the role of every business is to ensure the high quality of their market
offerings, optimize resource utilization, maximize efficiency, and maintain quality control.
Services are categorized into different types to make them easier to understand and manage efficiently. This
classification facilitates better communication and understanding among service providers, consumers, and
regulatory agencies.
• Business services: These are services that cater to the needs of businesses, such as consulting,
accounting, and legal services. McKinsey, a leading management consulting firm in the Philippines,
provides advice and expertise to help businesses improve their operations.
• Professional services: These services are performed by professionals who have specialized knowledge
and skills, such as doctors, lawyers, accountants, and architects. Philippine General Hospital is an
example of this, offering healthcare services provided by doctors and other healthcare professionals.
• Personal services: These services are aimed at fulfilling individual needs and include services like
personal grooming, fitness training, and home cleaning. A good example is a spa that offers massage
and beauty treatments or a Beauty Salon that offers different haircare treatments and make-up
services for various occasions.
• Social services: These services are geared towards enhancing the well-being of individuals and
communities, including services like childcare, elder care, and community development programs.
Bahay Tsinoy Foundation, a nonprofit organization that provides shelter for homeless individuals, is
an example of this service. Another one is the Philippine Social Welfare and Development Agency,

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which serves as the primary government institution responsible for social protection and poverty
alleviation programs in the country.
• Financial services: These services include banking, insurance, and investment services. For instance, a
commercial bank like BDO, Metrobank, and Unionbank provides various financial services, such as
savings accounts, loans, and credit cards.
• Hospitality services: These services are related to the tourism and hospitality industry, such as hotels,
restaurants, and travel agencies. For instance, Shangri-la Hotel and Astoria Plaza in Boracay offer
accommodation, dining, and concierge services to travelers.
• Transportation services: These services involve the movement of people or goods from one place to
another, such as airlines, taxi services, and shipping companies. A courier service that delivers
packages and documents like J&T, Lalamove, and Air21 are examples of these services.
• Communication services: These services facilitate the exchange of information, such as
telecommunications, internet providers, and media companies. The best examples are Globe and
Smart Telecommunications, the two leading mobile phone network providers in the Philippines, which
offer voice and data communication services to their customers.
• Education services: These services are related to the field of education, including schools, colleges,
and tutoring services. For instance, STI College provides learning classes to students.
• Entertainment services: These services offer leisure and entertainment options, such as movie
theaters, amusement parks, and event management companies. A concert venue that hosts live
performances is an example of an entertainment service.
Benefits of TQM in the Service Operation (Besterfield, 2024)

In the service industry, the implementation of Total Quality Management (TQM) fosters a proactive approach
to problem-solving. This approach emphasizes prevention rather than correction, enabling service
organizations to achieve elevated levels of quality and productivity such as:
• Improved customer satisfaction: Quality value in the service industry ensures that customers receive
services that meet or exceed their expectations. For instance, luxury hotel chains like Okada Manila
focus on providing exceptional services, such as personalized greetings, customized amenities, and
24/7 concierge assistance, which elevate the overall experience and leave a positive, lasting
impression on customers.
• Increased customer loyalty and retention: By consistently delivering high-quality services, companies
can build trust and loyalty, encouraging customers to return in the future. Apple is renowned for its
commitment to quality in its electronic products, creating a loyal customer base that eagerly awaits
their new releases and often becomes repeat buyers.
• Enhanced reputation and brand image: Quality value contributes to building a strong reputation and
a positive brand image. For example, Amazon has established itself as a leader in the e-commerce
industry by prioritizing quality in its vast product range and ensuring timely delivery, leading to a
reputation for reliability and excellent customer service.
• Competitive advantage: Offering superior quality services can give a company a competitive edge
over its rivals. Philippines Airlines differentiates itself by providing exceptional customer service, on-
time performance, and overall satisfaction, positioning itself as a preferred choice for air travel
compared to other airlines in the highly competitive industry.
• Operational efficiency and cost savings: Quality value focuses on streamlining processes and
eliminating inefficiencies, which can result in cost savings for the company. McDonald's introduced

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the “Self-service Kiosk” to improve the speed and efficiency of their food preparation, leading to cost
savings and faster service for customers.
• Employee satisfaction and productivity: Empowering employees to deliver high-quality services
boosts their job satisfaction and can lead to increased productivity. Tobys, a famous multi-brand
sports retailer, places great emphasis on employee satisfaction and empowerment, resulting in a
workforce that goes above and beyond to provide exceptional customer service.
• Continuous improvement and innovation: Quality value encourages a culture of continuous
improvement and innovation, pushing companies to evolve and stay ahead. Tesla, for example, has
revolutionized the electric vehicle industry by continuously improving its products, expanding charging
infrastructure, and introducing innovative features to provide customers with top-quality electric cars.
• Customer advocacy and referral: When customers experience quality value in the service industry,
they become advocates and are more likely to recommend the company to others. Apple's dedicated
fan base serves as a powerful marketing tool, as satisfied customers often refer their friends and family
to purchase Apple products.
• Reduced customer complaints and returns: By delivering services of high quality, companies can
minimize customer complaints and returns, saving time and resources. Uniqlo, a fast-fashion retailer,
has a stringent quality control process that ensures its products meet the desired standards, reducing
the likelihood of customer dissatisfaction or returns.
• Sustainable business growth: Quality value contributes to the overall growth and success of a
business. Toyota's strong focus on quality, displayed through its "Toyota Production System," has
allowed the company to become one of the largest and most profitable automakers globally, ensuring
sustained growth and success
Hindrances to Quality Service (Davis, 2024)

Implementing Total Quality Management (TQM) may appear deceptively effortless, but it poses numerous
challenges. The application of TQM in service-oriented enterprises encounters obstacles that necessitate
substantial cultural and organizational transformations. These shifts can prove to be challenging to accomplish
within the framework of service businesses:
• Lack of employee training and development: When employees are not adequately trained and
developed, they may lack the skills and knowledge needed to provide high-quality service. This can
result in mistakes, delays, and poor customer experiences.
➢ Solution: Implement regular training programs and provide opportunities for employees to
enhance their skills and knowledge.
• Inadequate communication: Miscommunication or insufficient communication between employees
and customers can lead to misunderstandings and dissatisfaction. If a customer's request is not clearly
understood by an employee, it can result in a wrong product or service being delivered.
➢ Solution: Implement effective communication channels and encourage open and transparent
communication between employees and customers.
• Poor leadership and management: When leaders and managers do not prioritize and emphasize the
importance of quality service, it can trickle down to the employees, affecting their motivation and
attitude toward delivering excellent service.
➢ Solution: Ensure strong leadership and management support, where quality service is set as a
priority and actively promoted among employees.

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• Inefficient systems and processes: Outdated or inefficient systems and processes can hinder the
delivery of quality service. If a customer must go through a lengthy and complicated process to get
their issue resolved, it can lead to frustration and dissatisfaction.
➢ Solution: Regularly review and optimize systems and processes to ensure they are streamlined
and customer-friendly.
• Lack of customer feedback and evaluation: Without input from customers, businesses may not be
aware of areas where their service falls short. A restaurant that does not actively seek customer
feedback may not realize that their service speed is too slow, resulting in customers leaving
unsatisfied.
➢ Solution: Establish mechanisms to gather customer feedback, such as surveys or suggestion boxes,
and use the feedback to identify areas for improvement.
• Insufficient employee empowerment: When employees do not have the authority or autonomy to
make decisions or resolve customer issues, it can hinder the delivery of quality service. If a customer
complaint goes through multiple levels of approval, it can lead to delays and frustration.
➢ Solution: Empower employees by providing them with the necessary authority and resources to
resolve customer issues promptly.
• Lack of consistent standards and guidelines: Inconsistency in service delivery can lead to confusion
and dissatisfaction among customers. A hotel that has different interpretations of cleanliness
standards across its various branches may result in varying customer experiences.
➢ Solution: Establish and communicate clear standards and guidelines for service delivery to ensure
consistency across all touchpoints.
• Failure to adapt to changing customer needs: If a business fails to understand and adapt to evolving
customer needs and preferences, it can result in outdated and irrelevant service offerings.
➢ Solution: Regularly conduct market research and engage with customers to stay informed about
their changing needs and modify service offerings accordingly.
• Lack of emphasis on employee satisfaction: Disengaged or dissatisfied employees are less likely to
provide quality service. A retail store that does not provide sufficient incentives or recognition for its
employees may lead to a lack of enthusiasm for serving customers.
➢ Solution: Prioritize employee satisfaction by implementing initiatives such as rewards and
recognition programs, employee surveys, and a positive work environment.
• Failure to resolve customer complaints effectively: Inability to address and resolve customer
complaints can damage the reputation of a business and lead to customer loss. A company that
mishandles customer complaints may face negative reviews and decreased customer loyalty.
➢ Solution: Establish a robust system for handling customer complaints promptly and effectively,
ensuring that customers feel heard, and their issues are resolved to their satisfaction
TQM in Manufacturing Operations
What is Manufacturing?
According to Jacobs (2024), Manufacturing is the process of converting raw materials, components, or parts
into finished goods on a large scale using machinery, labor, and various production techniques. It involves a
series of steps, such as design, engineering, production, and quality control, to create a final product that can
be sold to consumers or other businesses. This industry encompasses a wide range of sectors, including
automotive, electronics, food and beverage, pharmaceuticals, and more. The goal of manufacturing is to
efficiently produce goods that meet market demand while ensuring high quality and cost-effectiveness.

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Classifications of Manufacturing (Shafer, 2024)

Manufacturing operations are classified to establish a structured and comprehensive approach to organizing
and comprehending the various types of manufacturing activities. Grouping these activities facilitates analysis,
comparisons, and decision-making processes, as well as enables the identification of shared characteristics,
trends, and challenges within similar manufacturing sectors.
• Job Order Manufacturing: This involves producing customized products in small quantities according
to specific customer requirements. In the Philippines, Jeepney manufacturing creates unique designs
based on client orders.
• Batch Manufacturing: This method involves producing a specific quantity of items before moving on
to the next batch. A good example is the production of packaged food items like dried mangoes, which
are made in batches to meet market demand.
• Mass Production: This involves manufacturing large quantities of standardized products in an
assembly-line fashion. One notable example is the production of consumer goods like canned
sardines, which are manufactured in huge volumes.
• Continuous Manufacturing: This method involves the uninterrupted production of goods, often using
automation. For instance, the production of cement by companies like Holcim Philippines, where the
process runs continuously to meet market demands.
• Process Manufacturing: This entails the production of goods through a systematic series of steps.
Companies producing beverages, like San Miguel Corporation, utilize process manufacturing to create
beverages such as beer and soft drinks
Benefits of TQM in Manufacturing Operations (Besterfield, 2024)

The integration of Total Quality Management (TQM) in manufacturing operations fosters a culture of constant
improvement and active employee involvement. This approach facilitates enhanced problem-solving abilities
and promotes innovation, contributing to superior process control, waste reduction, and more effective
decision-making.
• Improved quality: TQM focuses on continuously improving product quality to meet customer
expectations and reduce defects. For example, Toyota's implementation of TQM has led to higher-
quality vehicles and increased customer satisfaction.
• Cost reduction: By identifying and eliminating waste and inefficiencies, TQM helps manufacturing
operations reduce costs while maintaining or improving product quality. For instance, Samsung saw
significant cost savings after implementing TQM in its manufacturing processes.
• Enhanced customer satisfaction: TQM aims to meet or exceed customer expectations, resulting in
higher customer satisfaction and loyalty. General Electric implemented TQM to improve customer
satisfaction and gain a competitive edge.
• Increased productivity: TQM involves focusing on process improvements and employee involvement,
leading to increased productivity. Ford's successful implementation of TQM resulted in significant
productivity gains in its manufacturing operations.
• Employee involvement and empowerment: TQM encourages involving and empowering employees
to contribute to continuous improvement and innovation. Philippine Airlines is known for its TQM
approach, which includes employee involvement and empowerment and has resulted in improved
operational efficiency.
• Better decision-making: TQM emphasizes data-driven decision-making, leading to better overall
decision-making in manufacturing operations. San Miguel Corporation's use of TQM has improved
decision-making and problem-solving within its manufacturing processes.

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• Competitive advantage: TQM can provide a competitive advantage by differentiating a company

through higher quality, lower costs, and greater customer satisfaction. As a result of TQM
implementation, Shein has achieved a competitive advantage in its manufacturing operations.
• Continuous improvement: TQM promotes a culture of continuous improvement, ensuring that
manufacturing operations are always striving to enhance processes and products. For instance, Apple
has successfully implemented TQM to achieve continuous improvement in its manufacturing
operations of Apple products to meet customer demands worldwide.
• Supplier relationships: TQM involves working closely with suppliers to ensure high-quality inputs,
leading to improved overall product quality. Japanese car brands like Toyota, Suzuki, and Honda’s TQM
approach have resulted in strong supplier relationships, ensuring high-quality components in its
manufacturing operations.
• Enhanced communication: TQM encourages open communication within manufacturing operations,
leading to better coordination, problem-solving, and innovation. Procter & Gamble has used TQM to
improve communication and collaboration within its manufacturing operations.
Hindrances to Quality Manufacturing (Davis, 2024)

Implementing Total Quality Management (TQM) may seem deceptively simple; however, it presents
numerous challenges. TQM's application in manufacturing businesses requires significant cultural and
organizational transformations, leading to various obstacles.
• Lack of Skilled Workforce: When employees lack the necessary skills and knowledge, it hampers the
manufacturing process and reduces the quality of products. Some business companies may struggle
to find workers with specialized technical skills required for certain manufacturing processes.
➢ Solution: Offer specialized training programs and partnerships with educational institutions to
develop a skilled workforce.
• Poor Infrastructure: Inadequate infrastructure and outdated facilities can lead to manufacturing
inefficiencies and affect product quality. A company might face issues such as unreliable power supply
or outdated machinery.
➢ Solution: Invest in modernizing infrastructure, upgrading machinery, and ensuring a stable power
supply.
• Inconsistent Supply Chain: Fluctuations in the supply chain, including delays or shortages in raw
materials or components, can disrupt manufacturing and compromise product quality. A company
might experience delays in receiving raw materials from suppliers due to transportation issues or
supply chain disruptions.
➢ Solution: Strengthen supplier relationships, establish backup suppliers, and consider
implementing just-in-time inventory management systems.
• Inadequate Quality Control Processes: Insufficient quality control measures, such as lack of proper
inspections and testing, can result in defective products reaching the market. A company might have
limited quality control checks and fail to identify product defects before shipment.
➢ Solution: Implement robust quality control processes, conduct regular inspections, and invest in
testing equipment to ensure product quality.
• Cultural Barriers: Differences in work culture and communication styles can impact manufacturing
quality, especially in multinational companies. A company collaborating with foreign partners may
face challenges due to cultural differences affecting coordination and understanding of quality
requirements.

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➢ Solution: Promote cross-cultural training, encourage effective communication practices, and

foster a collaborative work environment.
• Lack of Standardization: Inconsistent manufacturing practices and lack of standardized operating
procedures can lead to variations in product quality. A company might have different manufacturing
processes across different production lines, resulting in inconsistent product quality.
➢ Solution: Establish standardized operating procedures, implement quality management systems,
and conduct regular audits to ensure adherence to quality standards.
• Insufficient Investment in Research and Development: Lack of investment in research and
development limits innovation and the ability to improve product quality. A company may struggle to
allocate resources for research and development, hindering improvements in manufacturing
techniques and product quality.
➢ Solution: Allocate resources for research and development activities, promote innovation, and
collaborate with research institutions to enhance manufacturing processes and product quality.
• Regulatory Compliance Challenges: Adhering to complex and evolving regulatory requirements can
be a hindrance to quality manufacturing. Some companies must comply with local and international
regulations, which can affect manufacturing processes and quality control.
➢ Solution: Stay updated with regulations, invest in compliance management systems, and ensure
adherence to all applicable standards and certifications.
• Lack of Continuous Improvement Culture: Without a focus on continuous improvement,
manufacturing companies may face complacency and fail to address emerging quality issues. A
company may resist implementing changes to improve manufacturing processes, resulting in quality
stagnation.
➢ Solution: Foster a culture of continuous improvement, encourage employee involvement in
identifying improvement opportunities, and implement lean manufacturing principles.
• Inadequate Data Management: Poor data management practices can hinder decision-making and
compromise product quality. A company may face challenges in collecting, analyzing, and utilizing
manufacturing data effectively to identify quality improvement opportunities.
➢ Solution: Develop robust data management systems, implement data analytics tools, and ensure
data-driven decision-making processes to improve product quality.
Quality Measurements and Metrics

What is Quality Measurement?
Guevara (2023) defined quality measurement as “the fundamental process of assessing and evaluating the
characteristics and properties of a product, service, or process against established standards and criteria.”
Through the systematic gathering and analysis of data, quality measurement permits an objective assessment
of performance, adherence to requirements, and customer satisfaction.
In essence, quality measurements serve to identify areas that require enhancement, monitor progress, and
make well-informed decisions regarding potential changes or interventions. They play a vital role in monitoring
and controlling quality, ensuring consistency, and meeting customer expectations. Across diverse industries
and domains, an array of instruments and methodologies, including metrics, key performance indicators,
surveys, and audits, are employed to conduct quality measurements.
This comprehensive approach provides valuable insights into a system's effectiveness and efficiency, enabling
organizations to drive continuous improvement and elevate overall performance.

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Metrics Used to Conduct Quality Measurements (Guevara, 2023)

• Customer Satisfaction: This metric measures customers' satisfaction with products or services. An
example is the Net Promoter Score (NPS), which gauges customers' likelihood of recommending a
company's product or service. NPS is based on a simple question: "On a scale of 0-10, how likely are
you to recommend our product/service to a friend or colleague?" Respondents are then classified into
three categories: Promoters (scoring 9-10), Passives (scoring 7-8), and Detractors (scoring 0-6). To
calculate the NPS, the percentage of Detractors is subtracted from the percentage of Promoters. The
resulting score can range from -100 to +100. A positive NPS indicates that the majority of customers
are satisified and will recommend the product, while a negative score indicates unsatisfied customers
that will not recommend the product.
• Return on Investment (ROI): ROI measures the profitability of an investment and is used to assess the
financial returns relative to the investment's cost. Example: Calculating the ROI of a marketing
campaign to determine its effectiveness.
• Customer Retention Rate: This metric measures the percentage of customers that a business has
retained over a specific period. Example: A company with a high customer retention rate indicates
that its products or services are meeting customer needs effectively.
• Employee Productivity: This metric evaluates the output of employees in relation to the resources
expended. Example: Measuring the sales generated per employee to assess productivity.
• Defect Rate: Defect rate measures the number of defective products or services produced. Example:
A manufacturing company monitoring the defect rate in its products to ensure quality.
• Net Profit Margin: This metric assesses the profitability of a business by measuring the percentage of
revenue that translates into profit. Example: Analyzing the net profit margin to evaluate a company's
efficiency in cost management.
• Market Share: Market share measures a company's sales in relation to the total market. Example:
Tracking the market share of a company's product to assess its competitiveness.
• On-time Delivery Performance: This metric evaluates how often a business delivers products or
services on time. Example: A logistics company tracking on-time deliveries to ensure customer
satisfaction.
• Cost of Quality (COQ): COQ measures the costs associated with ensuring product quality. Example:
Assessing costs related to quality control, prevention, and appraisal activities.
• Employee Satisfaction: This metric measures the contentment and engagement level of employees.
Example: Using employee surveys to gauge satisfaction levels within the organization
References
Besterfield, D. (2024) Total Quality Management. Pearson
George, S. (2024) Total Quality Management: Strategies and Techniques Proven Today’s Most Successful Companies. Wiley LLC
Guevara, P. (2023). What are Quality Metrics? https://safetyculture.com/topics/quality-metrics/.
Shafer, M. (2024). Operations Management for MBAs. Wiley Publications.
Tarlengco, J. (2024). Quality Assurance and Quality Control. https://safetyculture.com/topics/quality-assurance-and-quality-control/

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QUALITY OPERATIONS STRATEGY

The changing business environment, characterized by an increasingly high-velocity service and fast-growing
product demand, underscores the growing importance of capacity planning and management. In a high-
velocity service delivery environment, the need for accurate and real-time capacity planning becomes
imperative, given the high levels of concurrent projects. Companies must refrain from guesswork in capacity
planning, especially as they strive to scale and diligently meet customer needs. Whether in the engineering or
consulting sector, the intricate planning and organizational tools required for maximizing customer experience
highlight the vital role of capacity planning in creating tangible business value and ensuring positive customer
experiences (Woodgate, 2023).
Capacity Planning
What is Capacity Planning?

According to the definition provided by Jacobs (2024), Capacity planning is the process of determining and
managing the resources required to meet the demand for goods or services effectively. By evaluating current
and future needs across production, businesses can optimize resource allocation, drive efficient operations,
and make informed decisions. Accurate forecasting aligned with available capacity is key in preventing
resource underutilization or overutilization, thereby enhancing cost efficiency and improving customer
satisfaction, making the audience feel efficient and effective.
Capacity Planning also allows businesses to proactively identify potential bottlenecks or constraints in their
production processes and take proactive measures to eliminate them. This enables enterprises to scale their
operations to accommodate growth or changes in market conditions, thereby maintaining a competitive edge.
Types of Capacity Planning (Laoyan, 2024)

There are various approaches to capacity planning that businesses can employ in different scenarios to
optimize production capacity.
A. Lead capacity planning. Also known as a lead strategy, involves expanding production capacity in
preparation for anticipated high demand. For instance, a retailer might require a surge of seasonal
employees during the holidays, whether that be for an entire season or just a temporary sales event. By
anticipating increased customer footfall, the retailer can effectively recruit additional staff to meet the
demand within a short timeframe.
B. Lag strategy planning. Lag strategy planning involves carefully strategizing to ensure that production
capacity can be increased in response to real-time demand. This approach is commonly utilized in fields
such as medical care, social work, or the restaurant industry, particularly in situations where individuals
are "on call." Depending on the workload, a manager may call additional team members
to ensure ample availability of resources, thereby guaranteeing that all customer or client needs are met
effectively.
C. Match strategy planning. It involves a strategic combination of proactive capacity planning and reactive
resource allocation. This process necessitates a gradual increase in capacity through small increments until
optimal resource utilization is achieved. For instance, consider the restaurant industry: A manager might
have multiple employees on call for the evening shift. When faced with an unexpectedly large party, he
may opt to summon additional servers to accommodate the surge until the crowds subside.

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Capacity Planning Process (Laoyan, 2024)

The process of capacity planning involves the following five (5) main stages to ensure the availability of
resources required when needed:
Step 1. Forecast anticipated demand. When one becomes aware of an upcoming project, it is wise to engage
in a well-informed assessment of the tasks that need to be completed. This evaluation
will provide valuable insight into the necessary skills and abilities required to execute the project
successfully. As a result, it becomes possible to compare this capacity with the existing available
resources.
Step 2. Determine required capacity. Based on the initial estimates, it is important to approximate
the capacity needed to complete the forecasted work. A common unit of measurement, such
as hours, or a project estimation tool can be utilized for this purpose. For instance, engineering
managers base their capacity planning on the number of hours required to finish a project.
Step 3. Calculate the resource capacity of the current team. To ensure that the team is not overwhelmed
and at risk of burnout, it is imperative to assess their capacity before introducing another project.
This can be accomplished by considering that an average person is typically able to
dedicate approximately 30 hours per week. To determine available capacity within a
week, one must subtract the total number of hours they are currently occupied with existing
projects from the average of 30 hours.
Step 4. Measure the capacity gap. Based on the capacity needed for a specific project and considering the
expected level of demand, evaluate and analyze how the existing resources align with the anticipated
requirements, considering the potential constraints and limitations that may impact the overall
capacity assessment.
Step 5. Align capacity with the demand. Consider analyzing the previous gap in capacity and subsequently
optimize the current and available capacity to achieve a balanced state. If the team is presently
operating at full capacity and unable to accommodate additional tasks to complete the project, a
short-term solution could involve adding team members to expedite project completion.
And should there be an excess of capacity, it may be best to integrate another project to
optimize the available resources effectively.
Key Considerations for Successful Capacity Planning

To remain competitive and ensure an over-arching positive brand and customer experience, businesses should
gain insight into the maximum number of customers they can accommodate over a specific period based on
their current projects (Tagetik, 2022):
• Accurate demand forecasting: This involves predicting future demand for products or services. For
example, Jollibee Foods Corporation, a fast-food company in the Philippines, uses sales data and
market trends to forecast demand for its menu items. This allows it to plan its capacity accordingly.
• Flexibility and scalability: Companies need to be able to adapt to changes in demand and scale their
operations up or down as needed. Philippine Airlines demonstrates this by adjusting its flight
schedules and fleet size based on seasonal demand fluctuations and market conditions.
• Efficient resource utilization: Maximizing the use of available resources, such as labor, equipment,
and facilities, is crucial. San Miguel Corporation, a diversified conglomerate in the Philippines,
optimizes its production processes to ensure efficient utilization of its manufacturing facilities.
• Risk management and contingency planning: It is important to anticipate and mitigate potential risks
that could impact capacity. A property developer like Ayala Land in the Philippines conducts risk
assessments to identify and plan for possible disruptions in its construction projects.

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• Technology integration: Leveraging technology to enhance capacity planning processes and improve
operational efficiency. Globe Telecom, a leading telecommunications company in the Philippines, uses
advanced network management systems to optimize its network capacity based on data usage
patterns.
• Collaboration and communication: Effective communication and collaboration among different
departments and stakeholders are essential. A retail giant like SM Supermalls coordinates with its
tenants to align capacity planning efforts with expected foot traffic and customer demand.
• Long-term strategic alignment: Capacity planning should align with the company's long-term strategic
goals and growth plans. Energy Development Corporation in the Philippines aligns its capacity
expansion initiatives with the country's renewable energy targets and its sustainability commitments.
• Regulatory compliance: Ensuring that capacity planning adheres to relevant laws and regulations. A
pharmaceutical company like Universal Robina Corporation follows strict regulatory guidelines in its
production capacity planning to meet quality and safety standards for its products.
Organizing Resources
What is Resource Planning?
According to Gupta (2023), Resource Planning, also known as Resource Management, involves the
identification, forecasting, and allocation of optimal resources, including human resources, equipment, assets,
and facilities, among others, to projects at the appropriate time and cost. Its objective is to ensure the efficient
and effective utilization of resources throughout the organization. In essence, resource planning is a strategic
process designed to maximize the use of resources based on their capacity and availability while delivering
each project within specified time and budget constraints.
Difference Between Resource Planning and Capacity Planning (Laoyan, 2024)

Although the two (2) are at times used interchangeably, capacity planning and resource planning are similar
yet distinct project planning strategies
Capacity planning is a strategic process that allows teams to anticipate and effectively manage any upcoming
increase in demand. It involves carefully evaluating the supply and demand dynamics of a business's
resources. The key to a successful capacity plan lies in its ability to accurately predict and prepare for
situations where the business experiences a significant surge in demand, requiring additional resources. By
proactively allocating and provisioning resources, a well-executed capacity plan ensures that the business is
fully equipped to meet the needs of its customers and maintain optimal operational efficiency.
Resource planning is a crucial process that empowers teams to effectively allocate their available resources to
the areas where they are most needed. The primary goal of resource planning is to strategically identify
and make the best use of the resources currently possessed by the business, as well as to determine the
optimal allocation of these resources. In addition, resource capacity planning entails a merging of both
resource planning and foresight, as it involves anticipating and preparing for the future requirement of
additional resources.
Resource Planning Process (McConnel, 2024)
The process of resource planning involves following four (4) main stages to ensure the stability of the bottom
line and access to available resources when needed. This is also referred to as the resource management life
cycle.

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Step 1. Evaluate Available Resources. After assessing the situation and determining the key objectives,
select the most suitable strategy and accurately estimate the resources required to achieve the set
goal. The process of resource forecasting must be approached with utmost efficiency and cost-
effectiveness in mind. These resources include labor, materials, equipment, and facilities, as well as
administrative support and subcontractors, among others.
Step 2. Procure Resources. Begin assembling the team based on the necessary skills and experience
prescribed by the project. Take the initiative to acquire the required equipment and secure reliable
contractors. This stage of resource planning entails the development of team roles, procurement,
contractual arrangements, budget allocation, performance evaluation methods,
and the implementation of policies and procedures to optimize resources.
Step 3. Manage Resources. The roles and responsibilities of the team members must be clearly defined,
along with everyone’s specific tasks. The roles of subcontractors should also be clear. If tools and
equipment are being rented for the project, it is essential to ensure that they are returned in a
condition that meets the requirements of the contract.
Step 4. Control Resources. It involves actively monitoring performance during implementation to ensure
that they are producing the anticipated outcomes. An important aspect of this step is the
measurement of the resource utilization rate, which assesses the effectiveness of using the resource.
In cases where the utilization rate is insufficient, it is necessary to initiate corrective measures,
including conducting a cost-benefit analysis. Continuous evaluation of results is essential to
maintain alignment with objectives.
Key Considerations for Successful Resource Planning (McConnel, 20224)

Resource management plans can vary across projects, as organizations often choose different levels of
complexity. However, at a basic level, a resource plan should include the following essential components.
• All the Resources Necessary to Complete the Project: Ensure to include all essential elements,
ranging from personnel to machinery and even office space, to create a comprehensive list. Dedicate an
ample amount of time to this task, as the level of completeness in the list will directly impact the
accuracy of the schedule.
• Timeframes For the Planned Effort of Each Resource: Carefully assessing the time needed for each
resource and making a precise projection of the project schedule.
• The Number of Each Resource Needed Per Day/Week/Month: Break down the project's resource
requirements on a daily, weekly, and monthly rotation to gain a more comprehensive understanding
of what is needed and when. It is recommended to utilize a resource histogram to facilitate this process.
• Quantity of Resource Hours Required Per Day/Week/Month: Ensure that the workload for each
resource is evenly distributed over the specified time by allocating the appropriate number of hours for
each resource.
• Assumptions and Constraints: Assumptions represent potential truths, while constraints encompass
factors such as schedule, cost, and scope of projects. It is essential to understand both assumptions and
constraints and their potential impact on the project plan.
• Resource Constraints: In addition to the traditional project management constraints that affect how to
manage resources, there are other specific limitations on resource availability to be considered, such
as required skill sets, geographical location, or even the availability of certain equipment.

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Quality Management and Control

What is Quality Management?
According to an article published by CFI Team (2023), Quality management is the essential practice of
supervising various activities and tasks within an organization to ensure the consistency and excellence of both
products and services. Its purpose is to achieve and uphold a desired standard of quality throughout the entire
organization.
What is a Quality Management System?

A quality management system (QMS) is a well-defined framework of processes and responsibilities that
ensures the smooth functioning of your business. Every organization has its own set of QMS, which includes a
formal set of policies, processes, and procedures designed to enhance customer satisfaction. A QMS serves as
a guiding force for organizations as they streamline and improve quality controls in areas such as
manufacturing, service delivery, and other crucial business processes.
The core benefits of a QMS include:

• Enhanced process and output consistency and standardization
• Reduced waste, lessened errors, and improved resource utilization
• Improved customer loyalty and retention by consistently delivering high-quality products and
services.
• Continuous evaluation and improvement of organizational operations
What is an ISO? (Davis, 2024)

ISO stands for International Organization for Standardization. It is an independent, non-governmental
international organization that develops and publishes international standards. These standards are designed
to ensure that products, services, and systems are safe, reliable, and of good quality.
ISO standards cover a wide range of areas, including technology, manufacturing, food safety, healthcare, and
environmental management. They provide a benchmark for organizations to follow, helping to improve
efficiency, reduce waste, and enhance customer satisfaction. ISO certification is often sought by companies to
demonstrate their adherence to these standards and to gain a competitive advantage in the market.
The ISO 9000: The International Standard for Quality Management Systems (ASQ, 2023)
The ISO 9000 is a family of standards and guidelines. It sets the requirement for quality assurance and
management’s involvement. The main objective of ISO 9000 is for the organizations to implement the
following standard requirements:
• Improve customer satisfaction by fulfilling customer requirements.
• Achieve continual improvement of organizational performance and competitiveness.
• Continually improve organizational processes, products, and services.
• Comply with regulatory requirements.
How ISO 9000 is Applied to Organizations

An online article published by ASQ (2023) stated that an organization must develop and use Quality
Management Systems (QMS) conforming to the strict standards and guidelines of ISO 9001 to secure
registration to ISO 9000.

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The quality management system must include the following documentation:

• A quality policy. It refers to a statement that describes how the organization approaches quality.
• The quality manual. It refers to a collection of guiding policies that address each clause of the ISO
9001 standard. It typically includes an organizational chart that illustrates management's
responsibility for operating the quality system.
• Quality objectives. It refers to the goals related to quality and must be in harmony with the quality
policy of the company.
• Quality procedures. It refers to a step-by-step method that describes how the company meets the
quality policy.
• Forms and records. It refers to the proof of activities that will support the quality procedures.
Benefits of ISO 9000 (Hayes, 2024)

The following are the benefits associated with ISO 9000 certification:
• Increased marketability. ISO 9000 certification provides businesses with heightened credibility to
current and prospective clients. An ISO-certified company denotes a consumer perception that the
company brings quality to its customers, which helps increase customer retention and acquisition.
• Reduced operational expenses. ISO 9000 registration exposes significant shortcomings in various
operational areas of the business, which can be improved to save the company time and financial
resources.
• Better management control. ISO 9000 registration process results in a realization of the company’s
overall direction since the certification requires self-assessment of the business process.
• Increased customer satisfaction. ISO 9000 registration uncovers areas in which the quality of the final
product can be improved, resulting in continual improvement in the outputs, which eventually leads
to higher levels of customer satisfaction.
• Improved internal communication. The ISO 9000 registration process emphasizes self-analysis and
operations management issues, encouraging various departments of a company to interact with one
another in hopes of gaining a complete understanding of the needs and desires of their internal
customers.
• Improved customer service. ISO 9000 registration refocuses company priorities on pleasing customers
in all respects, including customer service.
• Reduction of product-liability risks. ISO 9000 certification limits the chance of a company being
charged with product liability lawsuits because of the established ISO standards incorporated in their
processes.
• Attractiveness to investors. ISO 9000 certification increases a company's likelihood of securing funding
from venture capital firms.
ISO 9000 Versions/Updates (ASQ, 2023)

The various updates to ISO 9000 are summarized as follows:
• ISO 9000:1987. This initial version of the ISO 9000 standard emphasizes conformance with procedures
rather than the overall process of management. It contains three (3) models for quality management
systems as follows:
➢ ISO 9001:1987. Quality assurance in design, development, production, and installation
➢ services
➢ ISO 9002:1987. Quality assurance in production, installation, and servicing
➢ ISO 9003:1987. Quality assurance in final inspection and test

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• ISO 9000:1994. This version emphasizes quality assurance by enforcing preventive actions instead of
conforming to the procedures and checking the final product. However, it still requires comprehensive
evidence of compliance with properly documented procedures.
• ISO 9001:2000. This version combined ISO 9001, 9002, and 9003 into one (1) document that is ISO
9001. It sought to create a radical change in the concept of process management by monitoring and
optimizing the company’s activities to achieve quality improvement. In addition, it also emphasizes
the contribution of upper executives in integrating quality into the business system. It also gives
emphasis on enforcing performance metrics as a numerical measurement of the effectiveness of the
different tasks and activities of a company. Also, it highlights continual process improvement and
tracking customer satisfaction. The established requirements of this version for ISO certification were
the following:
➢ Approved documents before distribution
➢ Provided correct version of documents at points of use
➢ Presented company records to prove that requirements have been met
➢ Developed a procedure to control company records
• ISO 9001:2008. This version is not substantively different from ISO 9001:2000, but several important
requirements were added as follows:
➢ The quality policy must be a formal statement from upper management that is linked to
➢ the organization’s business and management plan.
➢ The quality policy must be understood and used by all personnel at all levels.
➢ Each member of the personnel must have a measurable work objective.
➢ The quality system must be audited regularly for conformance and effectiveness.
➢ Decisions about the quality system must be based on recorded data.
➢ Records must trace problems directly to its source. Records must include where and how
➢ raw materials were processed.
➢ The organization must have a comprehensive system for communicating with customers about
any aspects of the relationship.
➢ Product development must have planned stages with testing at every stage, and test results
➢ must be documented to indicate whether the product meets all applicable requirements.
➢ Organizational performance must be regularly reviewed.
➢ The organization must have documented procedures for dealing with nonconformance.
• ISO 9001:2015. This version is constructed around the seven (7) quality management principles, such
as customer focus, leadership, engagement of people, process approach, improvement, evidence-
based decision making, and relationship management. This ISO version emphasizes measuring and
properly assessing the input and output of processes. It encourages risk-based thinking by employing
risk analysis to determine the challenges in the business process of an organization. In addition, the
concept of stakeholders in the business is also extended from customers to suppliers, personnel,
shareholders, legislative bodies, society, and internal customers. This version recommends that
organizations must be aware of the importance of these stakeholder’s changing requirements and
standards.

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References
ASQ Org. (2023). What is the ISO 9000 Standards Series? https://asq.org/quality-resources/iso-9000
CFI Team. (2023). Quality Management. https://corporatefinanceinstitute.com/resources/management/quality-management/
Gupta, O. (2023). What is Resource Planning and Why is it Important? https://www.saviom.com/blog/what-is-resource-planning-and-
why-is-it-important/
Hayes, A. (2024). ISO 9000 Standard: Benefits and How to Achieve. https://www.investopedia.com/terms/i/iso-9000.asp
Laoyan, S. (2024). What is Capacity Planning? Tips to Apply the Right Strategy. https://asana.com/resources/capacity-planning#
McConnel, S. (2024). Resource Plan: The Ultimate Guide to Resource Planning. https://www.projectmanager.com/guides/resource-
management
Tagetik. (2022). Capacity Planning for Service Organizations: The Value of Scaling Your Business.
https://www.wolterskluwer.com/en/expert-insights/the-value-of-capacity-planning-process
Woodgate, Z. (2023). Why is Capacity Planning Important? https://www.precursive.com/post/why-is-capacity-planning-important

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BM2408

TQM TOOLS AND TECHNIQUES IN OPERATIONS MANAGEMENT

Failure Mode and Effects Analysis (ASQ, 2023)

Figure 1: Failure Mode and Effects Analysis

04 Handout 1 *Property of STI

Using FMEA in Business Operations

Description Potential Failure Potential Root Cause S O D RPN Action S O D RPN

04 Handout 1 *Property of STI

How to use FMEA

Benefits of Using FMEA

Statistical Process Control (Sharma, 2024)

Figure 3: Statistical Process Control (SPC)

04 Handout 1 *Property of STI

The following factors determine the degree of process conformity or non-conformity:

Using SPC in Business Operations

How to use SPC

04 Handout 1 *Property of STI

Benefits of Using SPC

Six Sigma Methodology (Kumar, 2024)

Figure 4: Six Sigma Methodology

04 Handout 1 *Property of STI

How to Use Six Sigma

Using Six Sigma in Business Operations

Benefits of Using Six Sigma

04 Handout 1 *Property of STI

Lean Management Principles (Verma, 2023)

Figure 5: Lean Management Principles

04 Handout 1 *Property of STI

How to Use LMP

Using LMP in Business Operation

Benefits of Using LMP

04 Handout 1 *Property of STI

Pareto Analysis (Krajewski, 2024)

Using the Pareto Principle in Business Operation

Customer Complaints Frequency

04 Handout 1 *Property of STI

= (42 + 20)/ 89 × 100% = 69.7%

Benefits of Using Pareto Analysis

04 Handout 1 *Property of STI

Root Cause Analysis (Krajewski, 2024)

Using Root Cause Analysis in Business Operation

The six (6) processing steps include the following:

Figure 8: Fishbone Diagram of Johnson Manufacturing Plant’s Header

04 Handout 1 *Property of STI

Benefits of Using Root Cause Analysis

Kaizen Events (Meissner, 2024)

04 Handout 1 *Property of STI

Figure 9: The Six-Step Cycle of Kaizen

How to Use Kaizen

Using Kaizen Events in Business Operations

04 Handout 1 *Property of STI

Total Productive Maintenance (Besterfield, 2024)

How to Use TPM

04 Handout 1 *Property of STI

Using TPM in Business Operations

Benefits of Using TPM

Design of Experiments (Jacobs, 2024)