TQM notes

Quality means “Performance upon expectations” and “fit for functions.”

A product is said to be of good quality if it satisfies the customer requirements in
terms of performance, grade, durability, appearance and intended use/purpose, etc.

Total Quality Management (TQM) is a management framework based on the

belief that an organization can build long-term success by having all its members -
- from low-level workers to its highest-ranking executives -- focus on improving
quality and, thus, delivering customer satisfaction.
This management approach is used to simplify supply chain management, as well as
to detect, reduce or remove errors. TQM requires organizations to focus on
continuous improvement, or Kaizen. TQM focuses on continual internal and
process improvements over the long term, thereby enhancing the quality of
produced products or services.

Importance of TQM
TQM can have a beneficial effect on employee and organizational development. By
having all employees focus on quality management and continuous improvement,
companies can establish and uphold cultural values that create long-term success for
both customers and the organization. TQM's focus on quality helps organizations
identify skill deficiencies in employees, along with the necessary training, education
or mentoring required addressing those needs.
 TQM notes

Principles of TQM

TQM prescribes a series of ways for organizations to accomplish this, with the
pathway to successful continuous improvement centered on the use of strategy,
data and effective communication to instill a discipline of quality into the
organization's culture and processes.
More specifically, TQM highlights the processes that organizations use to produce
their products, and it calls for organizations to define those processes,
continuously monitor and measure their performance, and use that performance
data to drive improvements. The eight guiding principles that TQM uses to
improve quality include the following:
1. Customer focus. The customer determines the quality level of the products
and services. Customer input is valued, as it provides a better understanding
of what the customer needs.
2. Employee involvement. All employees must participate in the processes
and system. They must be properly trained and given the needed resources to
complete their tasks on time.
3. Focus on process. Processes must be continually analyzed to identify
weaknesses. Every employee who takes part in the process should be
properly educated in their contributions, ensuring the right steps are taken at
the right time.
4. Integrated business systems. All TQM processes should be integrated into
a business process. Integrated systems convey potentially useful data across
departments, enabling everyone to be on the same page.
5. Strategic and systematic approach. Planning and management are
required using a strategic plan with quality as a base component.
6. Continual improvement. A focus on continually improving quality helps
an organization adapt to changing markets and achieve competitive
advantages.
7. Focus on data. Data should be collected, documented and analyzed to
improve decision-making accuracy and to predict trends based on previous
history.
8. Communication. Communication between teams with information such
as strategies, methodologies or timeliness is essential to improving
operations. Good communication can also motivate employees and
improve morale.

Implementation principles and processes

The general process of implementing TQM follows these steps:

1. The organization assesses its current culture and quality management systems
and identifies core values.
 TQM notes
2. Management decides to commit to TQM and develops a TQM master plan.

3. The organization identifies and prioritizes customer demands.

4. Management maps the processes needed to meet customer needs.

5. Management creates a team to oversee efforts to improve processes.

6. Management starts contributing to the process by providing additional planning

and training.

7. Management creates a process to standardize daily process management.

8. Management continually asks employees for feedback.

Implementing TQM is a long-term commitment, and the length of time needed for
planning, development and implementation varies by organization.

Benefits of TQM
TQM offers the following benefits:

1. Less product defects. An objective of TQM is to create products and

services correctly the first time. This means that products ship with fewer
defects, reducing product recalls, future customer support overhead and
product fixes.
2. Satisfied customers. High-quality products that meet customers' needs
result in higher customer satisfaction. High customer satisfaction, in turn,
can lead to increased market share, revenue growth via upselling and
word-of-mouth marketing initiated by customers.
3. Lower costs. As a result of less product defects, companies save money
on customer support, product replacements, field service and creating
product fixes. The cost savings flow to the bottom line, creating higher
profit margins.
4. Well-defined cultural values. Organizations that practice TQM develop
and nurture core values around quality management and continuous
improvement. The TQM mindset pervades across all aspects of an
organization, from hiring to internal processes to product development.

Disadvantages of TQM
The downsides of TQM include the following:
 TQM notes

1. Planning and resources. TQM needs a significant amount of planning

and resources over time to be properly allocated to the change.
2. Companywide commitment. Continuous improvement in TQM means
the organizational culture must focus on improving processes. All
management levels must be supportive.
3. Added costs. TQM might add training, infrastructure and team development
costs.
4. Time. It might take years for an organization to fully show intended results.
5. Partial efforts. Because of the effort involved in implementing TQM, a
partial move toward

What is Manufacturing Excellence in TQM

Manufacturing Excellence is the continuous improvement of your

operations to reduce waste, increase production profitability, and gain a winning
edge with quality and safety innovation. Manufacturing Excellence is referred to
as many different vocabulary terms including TQM, Lean Manufacturing, World
Class Manufacturing and more. One common misconception about Manufacturing
Excellence is that its focus is to maximize production throughput, but total
Manufacturing or Operational Excellence refers to multiple pillars of the business.
To achieve raising all pillars of operations, you must have a mix of a positive
work culture, constant process refinement and supporting technology.

What is Total Quality Control?

Total quality control is a broad-ranging set of techniques that are employed to
minimize errors throughout an organization. By doing so, an organization can
greatly improve both its profits and customer satisfaction.
or

Total quality control is a management system for an entire organization, not just the
manufacturing area. It is a system of integrated controls that ensures customer
quality satisfaction and economical costs of quality. It includes engineering,
purchasing, financial administration, marketing, and manufacturing.

What is TQM vs TQC?

TQM encompasses a broader organizational approach, incorporating various
management principles to improve overall quality across all areas of the business.
In contrast, TQC focuses primarily on quality control measures during the
production process

What are the 4 models of TQM?

 TQM notes
The Four models of the Total Quality Management Evolution

 1. Inspection. This is the first and basic level of the TQM evolution. ...

 2. Quality Control. Quality control focuses on the quality of the products.

 3. Quality Assurance.

 4. Total Quality Management

Difference between Total Quality Control, Total Quality Assurance and Total
Quality Management

JUST-IN-TIME (JIT)
Just-in-time inventory ensures that there is just the right amount of inventory to
produce only what you need, when you need it. The goal is to achieve high
production volumes with minimal inventory on hand, thus increasing efficiencies
and eliminating wastage. Many businesses have adopted just-in-time inventory to
save costs and stay competitive.
The just-in-time (JIT) inventory system minimizes inventory and increases
efficiency. JIT production systems cut inventory costs because manufacturers
receive materials and parts as needed for production and do not have to pay
storage costs.

What Are The Key Elements Of JIT?

A successful JIT production control systems usually have the following four key
characteristics:
 TQM notes

1. Improved plant layout. The layout of the plant must be improved to curtail
distances work in process must travel. In conventional plant layouts, all of the
machines of a similar class are assembled together in one location. For example,
all of the milling machines are usually in one location and all of the drilling
machines in another. Consequently, work in process should often move long
distances between operations. There are a number of problems with this. First,
moving components around the plant results in unnecessary costs. Second,
moving introduces waiting time. The components sit around waiting to be moved
and then it takes time to actually move them. Third, it is difficult to keep track of
individual items when the inventory is scattered all over the factory floor.

2. Reduced setup time. Reduced setup time provides the capability to

respond quickly to customer orders and reduces the need for safety stocks.

3. Low defect rates. A company should constantly strive to reduce the defects.
Large numbers of defects require that excess work in process be put into
production to ensure that there will be sufficient defect-free output to meet
customer orders. Therefore, defects should be eliminated as much as possible in a
JIT program.

4. Flexible workforce. Workers should be multi-skilled in a JIT environment,

which is often organized into small “cells” that contain all of the equipment
required to carry out many steps in the production process. Workers need to be
able to use all of the various pieces of equipment in the work cell. Also, workers
are typically expected to perform maintenance tasks on their own equipment and
to do their own quality inspections.

Benefits of JIT Inventory Management

1. Reduce Wastage

The JIT inventory management model eliminates excess inventory and

overstocking. You can have low inventory levels, significantly reducing the risk of
inventory going unsold and sitting unused in the warehouse. You can also
minimize the losses incurred due to defective products by easily identifying and
addressing defective inventory items when production volumes are low.
2. Improve Efficiencies

The JIT model reduces the costs of procuring, managing and storing excess raw
materials and inventory. This results in a higher inventory turnover which in turn
prevents inventory from sitting in your warehouse for too long and becoming
obsolete. You can also receive and store deliveries in the smallest possible
quantities, virtually eliminating excess raw material inventories.
 TQM notes
1. Increase Productivity

JIT inventory management increases productivity by reducing the time and

resources required for manufacturing. Product damage is also reduced
because of having lower inventory levels.
2. Optimize Production

JIT inventory management can eliminate bottlenecks and delays across the entire
production cycle, by reducing product defects and automating processes. Shorter
production cycles enable on-time deliveries and increase customer satisfaction.
JIT production scheduling ensures that jobs are scheduled exactly when they are
needed, meaning that your production runs start and end just in time for shipping.
3. Reduce Costs

As it requires very low inventory levels, JIT inventory reduces the working capital
required for inventory purchases as well as storage costs. Labor costs are also
lower as fewer factory workers are required in JIT manufacturing as compared to
full-time production.
4. Improve Quality In the JIT manufacturing model, suppliers guarantee
quality, so the deliveries go directly to production and avoid any delays
due to inspection.
What is the Difference Between MRP and JIT?
MRP and JIT (materials resource planning and just in time processing) are
two methods of controlling production and inventory levels for
manufacturers. MRP focuses on production of finished goods based on
forecast requirements, while JIT focuses on production as a response to
actual orders.
Materials resource planning is a comprehensive system of raw materials
ordering and production scheduling of equipment and manpower based on
forecast orders.
JIT is a manufacturing process that responds to actual orders. It relies on
the timely delivery of exactly the right raw materials in the right place to
allow for production as orders are received. An advantage of JIT is its
reduction of the amount of raw material and finished goods on hand,
which can reduce carrying costs.
Implementing JIT Inventory Management

There are several steps and considerations to effectively implement JIT inventory
management, such as:
Analyzing Historical Data to Identify Demand Patterns:-Before
implementing JIT, it is crucial for an enterprise to understand demand
patterns of products. By analyzing historical sales data, supply chain
 TQM notes
professionals can identify the frequency and volume of orders, seasonal
variations, and any unexpected demand spikes.
1. Building Strong Supplier Relationships
Ensuring smooth flow of materials in a JIT system requires the supply chain
organization of an enterprise to establish robust relationships with suppliers.
Open communication, trust, and reliability are essential factors for successful
JIT inventory management
2. Implementing Lean Manufacturing

JIT inventory management and lean manufacturing go hand in hand. Lean

manufacturing focuses on eliminating waste and maximizing value for the
customer. By implementing lean practices, supply chains can optimize
production processes, reduce lead times, and eliminate bottlenecks.
3. Embracing Technology Solutions

Technology plays a key role in JIT inventory management. Leveraging

advanced inventory management software and automation tools can
significantly enhance supply chain visibility and decision-making.

What Is Customer Satisfaction?

Customer satisfaction is a measure of how people feel when interacting with your
brand. It can be influenced by any number of factors, such as:

 perceived product quality

 perceived product value
 convenience
 customer expectations
 communication
 complaint handling
Every brand, no matter how successful, wants to improve customer satisfaction. To
do that, they need to define two things:

1. who their customers are

2. what it takes to satisfy them

What is customer data?
Customer data is the information your customers give you when interacting with
your business through your website, mobile apps, phone surveys, social media,
marketing campaigns, and other online and offline channels.

Types of customer data

 TQM notes
Here are four types of customer data, with details about what part of the customer
experience they cover:

1. Basic data

Basic data is the information you can use to make customer profiles in a database. It
can include a customer’s name, gender, location, and contact information. Another
part of basic data is financial information, like what they do for a living, what
industry they work in, how much money they make, and how much money they
make each year.

Examples of basic data include:

 Date of birth
 Phone number
 Email address
 Passport number

2. Interaction data

Another type of customer data is interaction data. It includes the different ways
customers can interact with the business. Also, it includes information about how a
product is used, how it is bought, and how popular it is.

Support engagement can also give you useful interaction data by showing
customers the most common reasons for using your support platforms. Other kinds
of customer interaction data are:

 Website visits
 Email open rate, forwards, and bounce rate
 Post likes, shares, or replies
 Click-through rate
 Cost per click
 Conversions

3. Behavioral data

Behavioural data can be similar to interaction data, but it focuses on how people
directly interact with a brand. It can include information about how users use your
services, such as when they sign up for a free trial, log in to their accounts, or
cancel them.
 TQM notes
Behavioural data about your customers can also include:

 Subscription details
 Average order value
 Previous purchases
 Devices
 User attention

4. Attitudinal data
Attitudinal data provides information on a customer’s direct opinion of a business.
It can give you an idea of how well a product or service in your business is doing
and what the public thinks of the brand.

You can get this type of customer data from direct methods like customer
interviews, focus groups, and online surveys. You can also get this information by
putting the option for online reviews on your website.

Customer data collection methods

Marketers can collect data from every platform where customers engage with a
brand. However, there are hundreds of ways to collect client data. We will look at
the most important methods that you can use to get your client data in a better
way in this section:

 Web tracking

Customers usually make contact with you through your website. You can collect
information about your customers, such as their demographics and location, how
they interact with your company and what they do through the website.

Tools like Google Analytics, Mixpanel, Piwik PRO, and Matomo can help you
learn about your customer’s interests, referral sources, conversion details, and
real-time behaviour on your website.

 Social media

You may learn a lot about your customers based on their social media interactions
with you. Aside from basic customer engagement metrics like likes, comments, and
shares, you can learn a lot about your customers by looking at each social media
platform’s analytics/insights section. Social media ads can boost the ante on your
customer data collection initiatives.
 TQM notes
You can find out about your customers’ interests and other traits by using the
targeting tools on social media platforms.

By uploading your email list to social media platforms and using the custom
audience feature, you can find out what they do on a certain social media channel
to learn more about them.

 Tracking pixels

A tracking pixel is a small piece of HTML or JavaScript code that is added to a

website or email and keeps track of every person who visits or opens the email.

 Customer feedback and surveys

Customer feedback and surveys are good ways to find out what your customers
are interested in, what they like, and what they prefer. Surveys can help you get
information about people’s thoughts and feelings by asking the right questions.

You can find out what people think about your products, services, sales, and
marketing through surveys.

Planning Process
Planning is the first primary function of management that precedes all other functions.
The planning function involves the decision of what to do and how it is to be done? So
managers focus a lot of their attention on planning and the planning process. Let us
take a look at the eight important steps of the planning process.
 TQM notes
Process management,

Process management is an approach to creating, managing, and optimizing a

process with the goal of improving results. Instead of focusing on individual tasks
and bottlenecks, process management looks at an entire process. It’s a component
of business process management or BPM, which refers to a business-wide
methodology, rather than one that looks only at a single process.

What are the 4 stages of process management?

1. Model the process as it should be.

2. Build and run your new workflow.
3. Analyze how the process performs.
4. Optimize the process

Definition of QFD

Quality Function Deployment (QFD) is a systematic analysis of customer

requirements that is used to improve the quality of your products. QFD originated
in Japan in the 1960s and 70s and was primarily developed by Yōji Akao.

The aims of Quality Function Deployment

The main aim of QFD is to improve a product or service so that it will be better
received by the market. The focus here is also on customer satisfaction. Ideally,
it’s best to apply QFD during the product planning phase, but you can also make
adjustments to the product later on the basis of a QFD analysis.

What Is Total Employee Involvement?

Total employee involvement is an organization methodology and set of
management principles that encourages individual contributors, team members,
and employees to participate much more in the problem solving, decision making
and planning processes that affect their organization.

What Are the Benefits of Employee Involvement?

With total employee involvement, all team members have the opportunity to help
their organization grow, reach its objectives, and overcome obstacles. They are
able to use more of their talents and intellect, along with feeling connected to
other team members who are doing the same. This also leads to benefits for the
organization, such as:

1. High Level Retention: When your team members see that you are interested
and care about their talents and contributions, they’ll be less likely to want to go
 TQM notes
to another company. Plus, they may tell others about their job satisfaction, which
can attract new talent.

2. Higher Motivation: Letting individual contributors use their abilities and

autonomy will motivate them to work smarter and be engaged. Plus, managers
who believe in total employee involvement communicate much more with their
team members, which improve morale and encourage creativity and inspiration.

3. Enhanced Talent Development: Through greater communication, training

and coaching, this management approach will help lead to colleagues who
understand your organization, customers, and industry much better. As they learn,
team members will feel free to give feedback, share insights, and take
responsibility to implement business improvements. Over time, people will gain
greater passion for continuous improvement, which will motivate them to
continue learning and contributing to the success of the enterprise.

4. Easier Change Management: All organizations go through the never-ending

cycle of change. Team members who don’t understand the reasons for changes
tend to resist them. In contrast, members who are already involved in
organizational improvements are likely to adapt to change more quickly and
actually be change agents for the business.

5. Focus on Results: When team members are informed about your

organization’s goals and objectives and involved in obtaining them, they will be
more focused and create value for all stakeholders. Managers will have less need
to push contributors to focus on objectives.

DEFINING PROBLEM

In Total Quality Management (TQM), problems arise from changes that

are being adapted to or because of something that has been troubleshot
wrong, not because of an individual employee.

QC Tool
The 7 tools of quality are generally used by quality control and
quality assurance engineers to solve product or process-related quality
issues on a daily/weekly/monthly basis and to reduce/eliminate non-
value-added activities like product rework, repair, and rejection.
1. Check Sheet
2. Fishbone Diagram
3. Histogram
4. Pareto Chart
5. Control Chart
6. Scatter Diagram
 TQM notes
7. Process Flowchart)

What Is Benchmarking?
Benchmarking is a process where you measure your company’s success against other
similar companies to discover if there is a gap in performance that can be closed by
improving your performance. Studying other companies can highlight what it takes to
enhance your company’s efficiency and become a bigger player in your industry.
The Benefits of Benchmarking
Competitive Analysis
By identifying areas you wish to improve on in your business and benchmarking your
existing performance against competitors, your business can strive to enhance your
execution tenfold. Using benchmarking this way has allowed businesses to gain
strategic advantages over competitors and grow industry averages.
Monitor Performance
Benchmarking involves looking at current trends in data and projecting future trends
depending on what you aim to achieve. In order to know you have been successful,
benchmarking needs to be a continuous process. Monitoring performance is an
inherent characteristic of it.
Continuous Improvement
As well as monitor performance, continuous improvement is an essential attribute of
benchmarking. This is because the aim of benchmarking is to improve a certain
element of a business. This improvement should not merely be something that
improves once and is forgotten, but something that improves over time and is
continuous
Planning and Goal Setting
Once benchmarking has been carried out, goals and performance metrics are set in
order to improve performance. These goals are new, more competitive targets for a
company but they must be achievable. If goals are unrealistic to achieve teams
become demotivated and goals are destined to remain unfulfilled.
Encourage Ownership
When companies look at their processes and metrics they need to ask hard questions
to get all the answers they need. This includes talking to everyone in the business and
understanding their roles. By asking these questions and gaining a better
understanding of everyone’s role, ownership for processes and performance is
encouraged. This means that employees will take pride in their job and the work they
do. This pride leads to better performance and higher-quality end results
 TQM notes

Understand Your Companies Advantages

Benchmarking identifies where your company is right now compared to where you
want it to go. If you are looking at improving any process in your business
benchmarking is a way of looking at how you can excel and become more successful
through outlining the steps needed to achieve your goal

Benchmarking Process

Planning
The first stage of benchmarking is the most important in the process. Planning
includes highlighting what you want to improve, who you will benchmark yourself
against, and how you envisage success. Only once this step has been completed will
you be able to move onto the next step as the results of planning will focus on the
information you need to collect and what success will look like.
Collection of Information
After planning, benchmarking is about collecting information on your processes and
how competitors do them. If you are looking to improve your customer service
satisfaction rating you should understand the processes involved in the department
how calls and communication are dealt with, and also how it differs from your
competition. Maybe you can talk to someone in another call centre, or call the centre
directly to gain first-hand knowledge of their processes. At this point, it is important
to gather as much information as possible.
Analysis of Data
Once you feel you have all the information you can gather, you can start to plot it and
begin to understand the shortcomings you may have. It is important to remember at
this point in the process that no business is perfect and you must have an open mind to
be able to analyse information objectively. Once findings start to be uncovered you
can draft a report and start discussing the next steps to achieve better performance in
this area
Action
Presenting findings to a department is never an easy thing, especially when you Are
proposing changes. Gathering and analysing information is only worthwhile when
you can implement changes and better the company in the process. Gaining buy-in
from a department can involve concessions so make sure the MVP you present is
accepted and will likely equate to the success highlighted in the planning stage
Monitoring
No plan is ever complete without monitoring results to determine how successful the
plan has been. The implementation phase will have highlighted metrics and goals for
 TQM notes

success within a time frame so monitoring these is the only way of knowing the
efficacy of the changes. Monitoring can be over a short or long period of time
depending on the desired outcomes

What is Kanban Methodology?

Kanban methodology is an agile method that aims at continuous improvement,
flexibility in task management, and enhanced workflow. With this illustrative approach,
the progress of the whole project can be easily understood in a glance. Kanban was used
in manufacturing settings to control inventory throughout the supply chain, using a
practice called just-in-time (JIT) manufacturing. In project management, the Kanban
methodology adapts the same concept by ensuring that the amount of required work is
the same as the work capabilities of the team.

How does Kanban work?

Kanban method revolves around the kanban board. It is a tool that visualizes the entire
project to track the flow of their project. Through this graphical approach of Kanban
boards, a new member or an external entity can understand what’s happening right now,
tasks completed and future tasks.

Kanban board indicates

 the current tasks that are being performed

 the tasks to do in the future
 the tasks that are completed

The divided columns are interconnected and tasks are gradually pulled from the
leftmost column (future tasks) to the rightmost column (completed tasks). Kanban
system measures the work cycle being completed through the principle of Work in
Progress (WIP). WIP has certain limits and a pre-defined specific status.
 TQM notes

Limiting WIP in order to maintain consistent standards is one of the core principles that
govern the Kanban methodology in Agile. It is extremely important for the team to
complete the current tasks in the prescribed order.

Core principles of kanban methodology

Kanban methodology stands on principles and practices. The core principles of Kanban
method are as follows:

1. Initiate with the existing workflow:

Kanban framework emphasizes on making small and gradual changes. Therefore, the
team must start with the existing workflow and continuously improve the process.

2. Limit the existing tasks:

It is important for the team to realize its own limits and cap the WIP accordingly.
Taking on more than you can handle will only waste time and negatively affect
the project.

3. Respect existing roles and responsibilities:

An important reason for Kanban’s success is that it does not require organizations to
completely overhaul the existing work culture. Many organizations resist modern
methodologies because they don’t feel comfortable with change. With Kanban,
efficiency is improved while staying in the confines of the existing setup.

4. Encourage leadership at all levels:

Project management methodologies such as the traditional method require approval
from the project manager for even the smallest tasks. Kanban gives the freedom of
making decisions to the individual working on the task. This grooms future leaders who
continuously learn from their mistakes and improve their work.

What Is the Taguchi Method of Quality Control?

The Taguchi method of quality control is an approach to engineering that
emphasizes the roles of research and development (R&D), and product design
and development in reducing the occurrence of defects and failures in manufactured
goods.

This method, developed by Japanese engineer and statistician Genichi Taguchi,

considers design to be more important than the manufacturing process in quality
control and aims to eliminate variances in production before they can occur.1

KEY TAKEAWAYS

 In engineering, the Taguchi method of quality control focuses on design and

development to create efficient, reliable products.
 Its founder, Genichi Taguchi, considers design to be more important than the
manufacturing process in quality control and seeks to eliminate variances in
production before they can occur.
 Companies such as Toyota, Ford, Boeing, and Xerox have adopted this
method.
 TQM notes

Understanding the Taguchi Method of Quality Control

The Taguchi method gauges quality as a calculation of loss to society associated
with a product. In particular, loss in a product is defined by variations and deviations
in its function as well as detrimental side effects that result from the product.

Loss from variation in function is a comparison of how much each unit of the
product differs in the way it operates. The greater the that variance, the more
significant the loss in function and quality. This could be represented as a monetary
figure denoting how usage has been impacted by defects in the product.

What Is Pareto Analysis?

Pareto analysis is a decision making tool premised on the idea that 80% of a
project’s benefit can be achieved by doing 20% of the work—or, conversely, 80% of
problems can be traced to 20% of the causes. In other words, it posits that not all
inputs have the same or even proportional impact on a given output.

Pareto analysis will typically show that a disproportionate improvement can be

achieved by ranking various causes of a problem and by concentrating on those
solutions or items with the largest impact. It is a technique for getting the necessary
facts to set priorities.

Pareto analysis is mainly used for business decision making but also has applications
in several different fields from welfare economics to quality control. A common part
of Pareto analysis is to graphically depict the occurrence of each variable being
tracked. This depiction is called a Pareto chart.

KEY TAKEAWAYS

 Pareto analysis states that 80% of a project’s benefit or results are achieved
from 20% of the work—or, conversely, 80% of problems can be traced to 20%
of the causes.
 As a decision-making technique, Pareto analysis statistically separates a
limited number of input factors—either desirable or undesirable—which have
the greatest impact on an outcome.
 Each problem or benefit is given a numerical score based on the level of
impact on the company; the higher the score, the greater its impact.
 Modern-day applications of Pareto analysis are used to determine which issues
cause the most problems within different departments, organizations, or
sectors of a business.
 By allocating resources to issues with higher scores, companies can use Pareto
analysis to solve problems more efficiently because they can target those
problems that have a greater impact on the business.
Steps of Pareto Analysis
By applying the 80-20 rule, problems can be sorted based on whether they affect
profits, customer complaints, technical issues, product defects, or delays and
backlogs from missed deadlines. Each of these issues is given a rating based on the
amount of revenue or sales and time lost, or the number of complaints received.
 TQM notes

Here is a basic breakdown of the steps of Pareto analysis:

1. Identify the problem or problems.

2. List or identify the cause of the issues or problems, noting that there could be
multiple causes.
3. Score the problems by assigning a number to each one that prioritizes the
problem based on the level of negative impact on the company.
4. Organize the problems into groups, such as customer service or system issues.
5. Develop and implement an action plan, focusing on the higher-scored
problems first, in order to solve the problems.

FAILURE MODE AND EFFECTS ANALYSIS (FMEA)

Quality Glossary Definition: Failure mode effects analysis (FMEA)

Also called: potential failure modes and effects analysis; failure modes, effects and
criticality analysis (FMECA)

Begun in the 1940s by the U.S. military, failure modes and effects analysis (FMEA)
is a step-by-step approach for identifying all possible failures in a design, a
manufacturing or assembly process, or a product or service. It is a common process
analysis tool.

 "Failure modes" means the ways, or modes, in which something might fail. Failures
are any errors or defects, especially ones that affect the customer, and can be
potential or actual.
 "Effects analysis" refers to studying the consequences of those failures.

Failures are prioritized according to how serious their consequences are, how
frequently they occur, and how easily they can be detected. The purpose of the
FMEA is to take actions to eliminate or reduce failures, starting with the highest-
priority ones.

Failure modes and effects analysis also documents current knowledge and actions
about the risks of failures, for use in continuous improvement. FMEA is used during
design to prevent failures. Later it’s used for control, before and during ongoing
operation of the process. Ideally, FMEA begins during the earliest conceptual stages
of design and continues throughout the life of the product or service.

 When to use FMEA

 FMEA procedure
 FMEA example
 FMEA resources
 TQM notes

Failure Modes and Effects Analysis Example

WHEN TO USE FMEA

 When a process, product, or service is being designed or redesigned, after quality

function deployment (QFD)
 When an existing process, product, or service is being applied in a new way
 Before developing control plans for a new or modified process
 When improvement goals are planned for an existing process, product, or service
 When analysing failures of an existing process, product, or service
 Periodically throughout the life of the process, product, or service

Some standard important for final exam

ISO 9000
The ISO 9000 family is a set of five quality management systems
(QMS) standards by the International Organization for Standardization (ISO) that
help organizations ensure they meet customer and other stakeholder needs within
statutory and regulatory requirements related to a product or service
ISO 9001
ISO 9001 deals with the requirements that organizations wishing to meet the standard
must fulfill.
ISO 9002
ISO 9002 is a model for quality assurance in production and installation
ISO9003
ISO 9003 for quality assurance in final inspection and test