Unit 1

Core Concepts of Total Quality

Management
 What is quality?
• Quality is often used to signify ‘excellence’ of a
product or service.
• In some manufacturing companies the word
may be used to indicate that a piece of
material or equipment conforms to certain
physical dimensional characteristics often set
down in the form of a particularly ‘tight’
specification.
 What is quality?
• In a hospital it might be used to indicate some
sort of ‘professionalism’.
• In management, quality means the true
requirements of the ‘customer’ – the needs
and expectations.
 What is quality?
Quality has been expressed in many ways by authors:
• ‘Fitness for purpose or use’ – Juran,
• ‘The totality of features and characteristics of a product or service
that bear on its ability to satisfy stated or implied needs’
• ‘Quality should be aimed at the needs of the consumer, present and
future’ – Deming,
• ‘The total composite product and service characteristics of
marketing, engineering, manufacture and maintenance through
which the product and service in use will meet the expectation by
the customer’ – Feigenbaum, the first man to publicize a book with
‘Total Quality’ in the title.
• ‘Conformance to requirements’ – Crosby, an American consultant
• Zero defects - Crosby
• ‘Degree to which a set of inherent characteristics fulfils
requirements’ – ISO (EN) 9000:2000 Quality Management Systems
 TQM
• Total: Everyone is involved

• Quality: Degree of Excellence

• Management: Act, art, or manner of planning,

organizing, controlling, leading.

TQM is an integrated effort designed to improve quality

performance at every level of the organization
 Basic terms related to TQM
• Quality Control (QC)
• Quality Assurance (QA)
• Quality Planning (QP)
• Quality Improvement
• Strategic Planning
• Quality Management
 Aspects of Quality
• Quality of design: is a measure of how well the product or
service is designed to achieve the agreed requirements.
• Quality of conformance to design: extent to which the
product or service achieves the quality of design. What the
customer actually receives should conform to the design,
and operating costs are tied firmly to the level of
conformance achieved.
• Quality of Performance- concerned with how well a
product functions or service performs when put to use. It
measures the degree to which the product or service
satisfies the customer. This is a function of both the quality
of design and the quality of conformance.
Remember that the final test of product or service
acceptance always lies with the customers
• Reliability refers to the ability of a product to
function effectively over a certain period of
time under certain conditions. Reliability is
related to the concept of quality of
performance.
 Dimensions of Product Quality
• Functionality- refers to core features and characteristics.
• Reliability- Measured in mean(average) time before failure
MTBF. Its an indicator of durability.
• Usability- Easily usable
• Maintainability- Ease with which the product can be
maintained in its original condition
• Efficiency- Brightness of a lamp at a given input voltage
• Portability- More important in terms of software.
 Dimensions of Service Quality
Additional features of service quality are-
Quality of-
• Customer service
• Service design
• Service delivery
 Customer Focus
• Total Quality Management is a customer-
focused approach.
• Its goal is to create/modify the product and
service development process so that they're
more valuable to the customer.
• To have a customer-focused TQM process,
start by determining your customers' needs,
desires, and roadblocks to success
 Customer Focus
Customers
• Who are my immediate customers?
• What are their true requirements?
• How do or can I find out what the requirements are?
• How can I measure my ability to meet the requirements?
• Do I have the necessary capability to meet the
requirements? (If not, then what must change to improve
the capability?)
• Do I continually meet the requirements? (If not, then what
prevents this from happening, when the capability exists?)
• How do I monitor changes in the requirements?
 Customer Focus
Suppliers
• Who are my immediate suppliers? What are my true
requirements?
• How do I communicate my requirements?
• How do I, or they, measure their ability to meet the
requirements?
• Do my suppliers have the capability to meet the
requirements?
• Do my suppliers continually meet the requirements?
• How do I inform them of changes in the requirements?
 Quality for Profit
• The goal of most companies is to conduct
business in such a manner that an acceptable
rate of return is obtained by the shareholders.
• Long Term Vs. Short Term
• Benefits of quality control may not be realized
immediately
• Advantages of a quality control system,, are
seen in the long run.
 Quality for Profit
• Improvement in the quality of products and
services.
• Production improves because a well-defined
structure for achieving production goals is
present.
• The system is continually evaluated and modified
to meet the changing needs of the customer
• Mechanism exists for rapid modification of
product or process design, manufacturing and
service to meet customer requirements so that
the company remains competitive.
 Quality for Profit
• Quality control system improves productivity,
which is a goal of every organization.
• It reduces the production of scrap and rework,
thereby increasing the number of usable
products.
• This reduces costs in the long run.
• With the production of few nonconforming items,
total costs
decrease,whichmayleadtoareducedsellingpricean
dthusincreasedcompetitiveness
 Quality for Profit
• With improved productivity, the lead time for
producing parts and subassemblies is reduced,
which results in improved delivery dates
• Quality control keeps customers satisfied.
Meeting or exceeding their needs on a timely
basis helps sustain a good relationship
• Quality control system maintains an
“improvement” environment where everyone
strives for improved quality and productivity.
 QUALITY COSTS
• The value of a quality system is reflected in its
ability to satisfy the customer.
• Quality costs reflect the achievement or non
achievement of meeting product or service
requirements, as determined from the
perspective of the customer.
• These requirements may include design
specifications of a product, operating
instructions, government regulations, timely
delivery, marketing procedures, and servicing
commitments, among others.
 QUALITY COSTS
• Quality costs may be interpreted as the
difference between the actual cost and the
reduced cost if products and services were all
conforming.
 QUALITY COSTS
The four major categories of quality costs are:
1. Prevention costs
2. Appraisal Costs
3. Internal Failure Costs
4. External Failure Costs
 Prevention costs
Incurred in planning, implementing, and
maintaining a quality system to prevent poor
quality in products and services.
Include salaries and developmental costs for
product design, process and equipment design,
process control techniques , information systems
design and all other costs associated with making
the product right the first time.
Also, costs associated with education and training
are included in this category
 Appraisal costs
• Associated with measuring, evaluating or auditing products,
components, purchased materials or services to determine their
degree of conformance to the specified standards.
• Include dealing with the inspection and testing of incoming
materials, product inspection and testing at various phases of
manufacturing and at final acceptance.
• Cost of calibrating and maintaining measuring instruments and
equipment and the cost of materials and products consumed in a
destructive test or devalued by reliability tests. Appraisal costs
typically occur during or after production but before the product is
released to the customer.
• Hence, they are associated with managing the outcome, whereas
prevention costs are associated with managing the intent or goal.
Appraisal costs normally decline with time as more nonconformities
are prevented from occurring.
 Internal failure costs
• Incurred when products, components, materials, and
services fail to meet quality requirements prior to the
transfer of ownership to the customer. These costs
would disappear if there were no nonconformities in
the product or service.
• Include scrap and rework costs for the materials, labor,
and overhead associated with production.
• As a total quality system is implemented and becomes
effective with time, internal failure costs will decline.
Less scrap and rework will result as problems are
prevented.
 External failure costs
• Incurred when a product does not perform satisfactorily after
ownership is transferred to the customer or services offered are
nonconforming.
• If no nonconforming units were produced, this cost would be??
• Costs include those due to customer complaints, which include the
costs of investigation and adjustments, and those associated with
receipt, handling, repair, and replacement of nonconforming
products.
• Warranty charges (failure of a product within the warranty time)
and product liability costs (costs or awards as an outcome of
product liability litigation) also fall under this category.
• A reduction in external failure costs occurs when a quality control
system is implemented successfully.
 Examples
The maker of classic motorcycles, Royal
Enfield had issued a recall after identifying
a defective ignition coil on bikes
manufactured and sold between Dec 2020
and April 2021.

The defect was discovered during routine internal testing and

the issue has been clearly identified and isolated to specific
batches of materials sources from our supplier between Dec 20
and April 21.
Meanwhile, Royal Enfield said that it follows stringent sourcing
protocols and all its bikes are rigorously tested to global
validation standards of quality and durability.
 Self Study
• PAF Model in Quality Cost TQM

• Think and Answer

• PDF Pg 9
 Benchmarks
• Benchmarks are reference points that you use to
compare your performance against the
performance of others.
• These benchmarks can be comparing processes,
products or operations, and the comparisons can
be against other parts of the business, external
companies (such as competitors) or industry best
practises.
• Benchmarking is commonly used to compare
customer satisfaction, costs and quality.
 KPI
• KPIs, are decision-making and monitoring
tools, used to track performance in relation to
strategic goals.
• KPIs chart whether an individual, project,
team, business unit or entire company is on
track to achieve its objectives.
• KPIs are a bit like an early warning system,
indicating where things might be heading off-
course and where action might be needed.
 Performance Benchmarking
• This involves collecting information on how well the
company is doing in terms of outcomes (like product
quality, revenue growth or customer satisfaction etc.)
and comparing these outcomes internally or externally.
• This can also refer to functional performance
benchmarking, such as benchmarking the performance
of the HR team (using metrics like employee tenure or
staff engagement surveys) or the marketing team
(market coverage or
• For example, if you are benchmarking your sales
performance, you may discover that your sales team is
not converting leads as effectively as your competitors
brand awareness.
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 Performance Benchmarking
• Benchmarking partners are usually drawn from the
same sector.
• It is common practice for companies to undertake
this type of benchmarking processes through trade
associations or third parties to protect
confidentiality.
• This type of benchmarking is suitable for assessing
relative levels of performance in key areas or
activities in comparison with others in the same
sector to find ways of closing gaps in performance.
 Competitive benchmarking
• Competitive benchmarking focuses all analysis in
regards to the measures of a competitor.
• The main objective is to evaluate competitive
edge and use the findings to define strategies to
compete in a common market.
• It could be around driving manufacturing
efficiency or agility in response to fluctuating
market demands or feature richness.
• Identifying the right initiative and defining the
gap-to-goal will help achieve competitive
advantage.
 Competitive benchmarking
May involve the following steps:
• Identify competitors
• Carry out reverse engineering of competitors’ products
• Finalize common set of customer requirements through
benchmarking
• Measure performance of competitors’ products or services
against the same customer requirements
• Rate competitors’ products against the same. E.g. The
performance measurement of the product or service
should be based on customers’ perception. The
performance has to be ranked on a scale of one to five, 1
being the worst or not at all satisfied and 5 being excellent
meaning that the customer is delighted.
 Role of a Manager
• Managers play an essential role in total quality
management.
• Managers must practice TQM, in addition to
preaching it, by using data collection and
planning tools such as flow charts, cause-and-
effect diagrams, Pareto and control charts.
• Use customer preference data to drive decision-
making.
• Provide frequent reports to staff and senior
management highlighting continuous
improvement in key performance indicators.
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 Role of a Manager
• Setting the standards of excellence and quality in the
organization.
• Developing plans and processes to ensure that these
standards are met.
• Being proactive in looking for and addressing areas where
performance can be improved.
• Initiating a TQM program with its associated costs and
cultural change requires commitment from senior
managers.
• Creating a team of line managers knowledgeable about
TQM to support and communicate the core principles and
behaviors expected in a TQM-based organization.
• Training employees in TQM principles and techniques
 Recognition and Reward
• Recognition of achievement is important in a TQM environment.
• it is important to recognize achievement of employees, customers
and suppliers.
• Every employee or supplier is to meet the requirements to satisfy
his customers. However, there would be a few teams, and few
suppliers, which will excel in their contributions.
• Meeting customer requirements is not enough for recognition.
Exceeding customer requirements or satisfying customers, whether
internal or external, can be considered to be an achievement.
• Such achievements, if they are recognized and appreciated, should
enable the achievers to perform with more interest, enthusiasm
and by putting in more efforts.
• If achievement is not recognized then they may drop from the
normal level of performance.

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 Recognition and Reward
• Recognition has to aim at transforming each
employee as a performer and an achiever, as this
is an important step towards achieving the goals
and objectives of the organization.
• If the recognition is genuine and without any
bias, such awards will not de-motivate other
employees in the organization.
• On the contrary, it should rather motivate others
to improve their performance and quality for an
award.
 Recognition and Reward
• The organization should select the award appropriately.
– appreciation in an annual meeting,
– certificates,
– mementos,
– cash awards.
• No matter what is the type of award, the employees will
definitely be motivated.
• However, the organization should be consistent in giving the
awards. Whoever or whichever team exceeds that
performance threshold, could be awarded the same type of
award. The organization should not keep on changing the
type of award.

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 NEED FOR RECOGNIZATION
• Improve employee’s morale.
• Show the company’s appreciation for better
performance.
• Create satisfied workers.
• Create highly motivated workplace.
• Reinforce required behavioral patterns.
• Stimulate creative efforts.
40
• The best known international TQM awards are
– Japan’s Deming Prize,
– USA’s Malcolm Baldrige National Quality Award
– European Quality Award (now referred to as
the EFQM Excellence Award.)
• India –
– Golden Peacock National Quality Award
– Rajiv Gandhi National Quality Award.
• Tata Steel has been declared the Winner of
the prestigious Golden Peacock National
Training Award for the year 2024
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 Garvin’s Five Approaches to Defining
Quality
1. The transcendent approach: quality is absolute and universally
recognizable.
2. The product-based approach: quality is precise and measurable variable.
3. The use-based approach: quality is defined in terms of fitness for use or
how well the product fulfils its intended functions.
4. The manufacturing-based approach: quality is conformance to
specifications i.e. targets and tolerances determined by product designers.
5. The value-based approach: quality is defined in terms of cost and prices.
Here, a quality product is one that provides performance at an acceptable
price or conformance at an acceptable cost.

Poornima M Charantimath
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Five Dimensions of Service Quality

43
David Garvin’s Eight Dimensions of
Product Quality

44
 Steps involved in implementing TQM
1. Obtain the top management commitment and educate
2. Create a steering committee
3. Clarify the vision, mission, and values
4. Prepare a flow diagram of company’s processes
5. Identify Critical Success Factor (CSF) and develop measures and
metrics to track CSF data
6. Identify customer groups and solicit feedback
7. Monitor CSF and develop an improvement plan
8. Provide a quality training programme
9. Identify quality improvement projects
10. Establish quality improvement teams
11. Implement process improvements by using TQM tools
12. Measure the benefits of TQM, review, report, and reward

45
 Common Barriers in implementing TQM

a. Lack of management commitment

b. Inability to change organisational culture
c. Improper planning
d. Lack of continuous training and education
e. Incompatible organisational structure
f. Ineffective measurement techniques
g. Lack of focus on internal and external customers
h. Lack of empowerment and teamwork
i. Lack of efforts to implement continuous improvement measures
in operational processes
Unit 2
 Evolution of Total Quality
Management
• 1924- W.A Shewhart,(father of statistical quality control) Bell
Telephone Labs, developed a statistical chart of control of
product variables.
• 1946- American Society of Quality Control (Now American
Society of Quality ASQ).
• 1950’s- Edward Deming emphasized about the management’s
responsibility to achieve quality.
• 1960’s- Quality control circles were first formed
• 1980’s-Automotive industry emphasis on statistical process
control
• 1990- ISO model for quality management worldwide
 Quality movement in India
• 1948- Shewhart visited India, initiated SQC in indian
companies
• 1950’s – Deming came to India
• 1980’s- CII consolidated the quality movement
• 1982- Quality Circle started
• 1987- CII organized seminar by J Juran, formation of
TQM division
• 1989- CII training programs and certifications in ISO
9000 quality systems
• 1992- CII launched National Quality Campaign and
annual Quality Summit
4 levels in the evolution of TQM
 Level 1 - Inspection
• Initially, only way of ensuring quality
• One or more characteristics of product/service/activity
are examined/measured/tested/assessed and compared
with specifications.
• Carried out by dedicated staff/self inspection
• Non conforming materials /components /forms
/products/goods are scraped/ reworked/ modified
/passed on at concession
• It is an ‘After the Event’ screening process ,no prevention
content only identification of suppliers /operations
/workers who are producing non conforming products
/services
• Reactive quick fix corrective action, dept based thinking.
 Level 2 -Quality Control
• Some development from basic inspection activity.
• Greater process control
• Use of information/tools/technique
• Lower incidence of non-conformance
• Inspection and QC operate in a detection-type mode, i.e.
finding and fixing mistakes.
• 100% inspection is only 80% effective
• Producing Vs. Checking situation
• Leads to the belief that
– non-conformance are due to product/service nor being inspected
enough
– Operators, not the system, are the sole cause of problem
 Level 3 -Quality Assurance
• Shift from detection to Prevention based system
• Org effort are directed towards planning and preventing
problems from occurring at source.
• Requires use of 7 quality control tools( histogram, check
sheet, Pareto analysis, Cause- and-effect diagram,
graphs, control charts and scatter plots), statistical
process control, FEMA(failure mode and effect analysis)
and gathering and use of quality costs.
• Advanced quality planning, training, critical problem
solving, improving the design of products, processess and
services, improving control over the process ,motivating
and involving people.
 Level 4 -TQM
• Appication of quality mgmt principles to all
aspects of org, including customers,suppliers
and all stakeholders.
• TQM principles to be applied in every branch,
every level of the org with integration into
business practices
• Customer satisfcation to customer delight
 Balanced Scorecard (BSC)
• By Kaplan and Nortan
• https://hbr.org/1992/01/the-balanced-
scorecard-measures-that-drive-performance-2
• A balanced scorecard (BSC) is defined as a
management system that provides feedback
on both internal business processes and
external outcomes to continuously improve
strategic performance and results.
BSC
• TOTAL QUALITY MANAGEMENT AND THE
BALANCED SCORECARD APPROACH: A
CRITICAL ANALYSIS OF THEIR POTENTIAL
RELATIONSHIPS AND DIRECTIONS FOR
RESEARCH

• https://www.sciencedirect.com/science/articl
e/abs/pii/S1045235402001600
 Key Elements of TQM
• Commitment and leadership of the CEO
– E.g. Venu Shrinivasan,1st Indian to receive Deming award
• Planning and Organization
• Using tools and techniques
• Education and training
• Involvement
• Teamwork
• Measurement and Feedback
• Ensuring that the culture is conducive to continuous
improvement activity
 Kaizen
• Continuous improvement in areas like quality,
cycle time of
 The 5 S Pillars
• Sort (Seiri),
• Set in Order (Seiton),
• Shine (Seiso),
• Standardize (Seiketsu) and
• Sustain (Shitsuke)
 The Japanese 5-S
Workplace Organization Method, The 5-S is the key to total quality
environment, a philosophy most Japanese factories endorse and practice

Japanese term English Meaning Goal

Seiri Sort Discard rubbish and Separate
Keep Important

Seiton Set in Order Set everything in Retrieve quickly

Orderliness proper place for quick
retrieval and storage
Seiso Cleanliness Clean the workplace Sweep
Individual cleaning
responsibility
Seiketsu Standardise Standardise the way Spruce
of cleaning
Shitsuke Self- Discipline, Performing 5-S daily
discipline commitment
Quality Function Deployment
QFD