Topic 1

Total Quality Management

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Total Quality Management

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 The Evolution of TQM

There are four main levels:

- Inspection
- Quality Control,
- Quality Assurance and
- Total Quality Management
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Total quality management can be viewed as a natural extension
of earlier approaches to quality management

Makes quality central

and strategic in the Quality is strategic
organization Teamwork
Staff empowerment
Involves customers and suppliers
Broadens the
organizational Quality systems
responsibility for quality Quality costing
Problem solving
Quality planning
Statistics
Solves the root Process analysis
cause of quality Quality standards
problems

Error
Prevents ‘out of
detection
specification’ products and
Rectification
services reaching market

Quality Quality Total Quality

Inspection
control assurance Management
The Evolution of TQM

Inspection

- Carried out by dedicated staff or be self-inspection by the process owner,

- Characteristics, service or activity are measured, examined or tested and compared to the

standard or the customer requirements for conformance - accept or reject

- Emphasis on quick-fix

- Thinking is Departmental….siloed

- Systems are in-house based with no integrated involvement of the customer

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The evolution of TQM

Quality Control
- Development of methods & systems in maintaining quality
- Self Inspection by approved Operators,
- Quality Control measures leading to greater Process Control
- Lower rates of non-conformances detected,
- Organisations are operating in a detection-type mode

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The evolution of TQM

What is DETECTION
In a ‘firefighting’ environment, the organisational emphasis is on getting rid of the non-
conformances after they have occurred…..REACTIVE

Considerable effort made in after-the-fact inspection, trouble-shooting and providing a

‘quick-fix’ solution to the customer.

Detection does not improve the quality of the product and/or service – it accepts the
existence of defects and non-conformance.

100% Visual Inspection has been shown by studies to be only 80% effective.
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The evolution of TQM

Quality Assurance
• Finding a problem after-the-fact is not an effective way to eliminate the root cause of the
non-conformance.
• Lasting improvement in Quality can only be achieved by an organisational approach to
planning and preventing non-conformances at source.
• PROACTIVE…PLANNING FOR PREVENTION
• Use of the Seven Quality Tools,
• FMEA,
• Statistical Process Control,
• A comprehensive Quality Management system employed.
A shift from Detection to Prevention 8
 The principles of Total Quality (TQ)
- focus on the customer,
- involve everyone,
- build in continuous improvement,
- are simple to understand and are common sense

Yet!
Many organisations have great difficulty in implementing them……
Are managers afraid to let go of power …. afraid of commitment to systems
….afraid of not being able to deliver on the voice of the customer ….afraid of the
cost …..don’t want to know what it’s costing NOT to adopt TQM ?
TQM means….
• meeting the needs and expectations of customers;
• covering all parts of the organization – top down and bottom up;
• including every person in the organization;
• recognising that every process is delivered across several departments and
has many handovers and interdependencies
• developing and delivering the systems and procedures which support quality
and improvement;
• developing a continuous process of improvement - - examining all costs which
are related to quality, especially failure costs and getting things ‘right first time’;
• making good, data-based decisions
• building win:win relationships
Does TQM Work??

Numerous studies have found that there was a positive relationship

between the extent to which companies implement TQM and its
overall performance.
However, managers should implement TQM as a whole set of
ideas rather than simply picking a few techniques to implement.
The same studies also suggest that where TQM does not prove
successful in improving performance, the problems could be the
result of poor implementation rather than in the TQM practices
themselves, and that a serious commitment on the part of top
management to TQM is a prerequisite for success.
 Why does TQM fail?
- Top Management sees no reason for….or is afraid of change

- Management focus is on the bottom line, not on the customer

- Top Management is not concerned for its staff

- There is no understanding of the organisational

systems/processes/interdependencies/linkages

- Top Management is not committed to totality of TQM principles – treat like a pick’n’mix

- There is no system for data collection/management

- The company loses interest after 6-12 months …doesn’t give time for change to work
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 Remember:
Acceptable Quality Level……Vs TQM!
A story which illustrates the difference in attitude between a TQM and a non-TQM company has become almost a legend
among TQM proponents.

It concerns a plant in Ontario, Canada, of IBM, the computer company.

It ordered a batch of components from a Japanese manufacturer and specified that the batch should have an acceptable
quality level (AQL) of three defective parts per thousand.

When the parts arrived in Ontario they were accompanied by a letter which expressed the supplier’s bewilderment at
being asked to supply defective parts as well as good ones.

The letter also explained that they had found it difficult to make parts which were defective, but had indeed managed it.
These three defective parts per thousand had been included and were wrapped separately for the convenience of the
customer.
The 4 Costs of Quality
Prevention, Appraisal, Internal Failure, External Failure
Costs of Quality
Prevention Costs are those costs incurred in trying to prevent problems,
failures and errors from occurring in the first place.
They include such things as:
● identifying potential problems and putting the process right before poor
quality occurs;
● designing and improving the design of products and services and processes
to reduce quality problems;
● training and development of personnel in the best way to perform their jobs;

● process control through SPC.

Costs of Quality
Appraisal Costs are those costs associated with controlling quality to check to
see if problems or errors have occurred during and after the creation of the
service or product. They might include such things as:
● the setting up of statistical acceptance sampling plans;
● the time and effort required to inspect inputs, processes and outputs
● obtaining processing inspection and test data;
● investigating quality problems and providing quality reports;
● conducting customer surveys and quality audits.
Costs of Quality
Internal failure costs are failure costs associated with errors which
are dealt with inside the operation.
These costs might include such things as:
● the cost of scrapped parts and material;
● reworked parts and materials;
● the lost production time as a result of coping with errors;
● lack of concentration due to time spent troubleshooting rather
than improvement.
Costs of Quality
External failure costs are those which are associated with an error
going out of the operation to a customer.
These costs include such things as:
● loss of customer goodwill affecting future business;
● aggrieved customers who may take up time;
● litigation (or payments to avoid litigation);
● guarantee and warranty costs;
● the cost to the company of providing excessive capability (too much
coffee in the pack or too much information to a client).
Total Cost of Quality
Costs of Quality
TQM rejects the ‘optimum-quality level’ concept and strives to reduce all known and
unknown failure costs by preventing errors and failure taking place.

Of the four cost categories, two (costs of prevention and costs of appraisal) are open to
managerial influence, while the other two (internal costs of failure and external costs of
failure) show the consequences of changes in the first two.

BUILD QUALITY IN!!!

Apply TQM
 What is Total Quality Management?

Total Quality Management or TQM describes a management approach to long–term

success through customer satisfaction.

In a TQM effort, all members of an organisation participate in improving processes,

products, services, and the culture in which they work.

The methods for implementing this approach come from the teachings of such quality
leaders as Deming, Crosby, Feigenbaum, Ohno, Ishikawa, and Juran.
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8 Principles of TQM
(Similar to, but NOT the same as, the 7 Quality Management
Principles, which are the basis for ISO9001:2015)
8 Principles of TQM

(ASQ.org)
8 Principles of TQM
1.Customer-focused: The customer ultimately determines the level of quality. No matter what an
organization does to foster quality improvement—training employees, integrating quality into the
design process, or upgrading computers or software—the customer determines whether the efforts
were worthwhile.

2.Total employee involvement: All employees participate in working toward common goals. Total
employee commitment can only be obtained after fear has been driven from the workplace, when
empowerment has occurred, and when management has provided the proper environment. High-
performance work systems integrate continuous improvement efforts with normal business
operations. Self-managed work teams are one form of empowerment.
8 Principles of TQM
3. Process-centered: A fundamental part of TQM is a focus on process thinking. A
process is a series of steps that take inputs from suppliers (internal or external) and
transforms them into outputs that are delivered to customers (internal or external).
The steps required to carry out the process are defined, and performance measures
are continuously monitored in order to detect unexpected variation.

4. Integrated system: Although an organization may consist of many different

functional specialties often organized into vertically structured departments, it is the
horizontal processes interconnecting these functions that are the focus of TQM.
8 Principles of TQM
5. Strategic and systematic approach: A critical part of the management of quality is the
strategic and systematic approach to achieving an organization’s vision, mission, and
goals. This process, called strategic planning or strategic management, includes the
formulation of a strategic plan that integrates quality as a core component.

6. Continual improvement: A large aspect of TQM is continual process improvement.

Continual improvement drives an organization to be both analytical and creative in
finding ways to become more competitive and more effective at meeting stakeholder
expectations.
8 Principles of TQM
7. Fact-based decision making: In order to know how well an organization is
performing, data on performance measures are necessary. TQM requires that an
organization continually collect and analyze data in order to improve decision making
accuracy, achieve consensus, and allow prediction based on past history.

8. Communications: During times of organizational change, as well as part of day-to-

day operation, effective communications plays a large part in maintaining morale and in
motivating employees at all levels. Communications involve strategies, method, and
timeliness
 There are 8 Principles of Total Quality Management

8. Communications

Everybody in your organization needs to be aware of plans, strategies, and methods that will
be used to achieve goals. There is a greater risk of failure if you don’t have a good
communication plan.

Communicate with your suppliers – build relationships – understand their capabilities,

constraints, quality culture….create a win:win

Communicate with your workers - build relationships – understand their capabilities,

constraints, quality focus, aspirations…. create a win:win

Communicate with your customers – build relationships – understand their demands, needs,
future trends in development…. create a win:win

Transparency – Credibility – Consistency of Message – Often!

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The seven quality management principles – the basis for ISO9001:2015 are:
QMP 1 – Customer focus
QMP 2 – Leadership
QMP 3 – Engagement of people
QMP 4 – Process approach
QMP 5 – Improvement
QMP 6 – Evidence-based decision making
QMP 7 – Relationship management
TQM
Build quality in – don’t inspect it in….
Starting Point: The Gurus in Japan
Deming….14 Points
Juran….10 Points
Ishikawa….Respect
Ohno….Waste and 10 Precepts
and others

Understand what is is….then sell it to the

Leadership!

Leadership commitment is critical to its success.

 Some Quality Gurus

Walter W. Edwards Joseph Juran Philip Crosby Kaoru Taiichi Ohno Armand V.
Shewhart Deming (1904 – 2008) (1926 – 2001) Ishikawa (1912 – 1990) Feigenbaum
(1891 – 1967) (1900 – 1993) (1915 – 1989) (1920 – 2014)
• Created an • Created the concept • ‘Fitness for Use’ • Trained as a • Developed ‘Cause • 7 Wastes Coined the phrase:
understanding of of Management • ‘Cost of Quality’ Podiatrist between and Effect’ • Toyota Total Quality Control
Process Variability Responsibility • 3 Basic Steps to wars…also the Diagrams Production The concepts of the
• Developed • Deming’s 14 Points Progress Navy WWII and (Fishbone System (TPS) ‘Hidden Factory’
Statistical • Deming Cycle • 10 Steps to Quality Korea Analysis) • Kanban and
Performance (PDCA…to PDSA) Improvement • Pershing Missile…. • Recognised the • Just in Time “Quality is what the
Control Charts • 7 Deadly Diseases • Juran’s Trilogy: Q developed concept of the • 10 Precepts customer says it is”
(track variation in • Father of Total Planning, Q ‘Zero Defects’ ‘Internal Customer • Crucial elements
performance Quality • Defined ‘Quality of Total Quality
systems) Control, Q • ‘Quality’ is
Management Improvement conformance to Circles’ (now, also • Three Steps to
• Shewhart Cycle - Quality
• Pareto Principle - requirements known as Kaizen
Plan Do Check Act Groups) • Ideas and beliefs
(as later 80/20 rule • 4 Absolutes of
Quality became the
championed by founding elements
Deming) Management
of the Malcolm
• Grandfather of • ‘Quality is Free’ Balbridge National
Total Quality Quality Award criteria.
Management
 Quality characteristics of goods and services

Functionality - how well the product or service does the job for which it was intended.

Appearance - aesthetic appeal, look, feel, sound and smell of the product or service.

Reliability - consistency of product or services performance over time.

Durability - the total useful life of the product or service.

Recovery - the ease with which problems with the product or service can be rectified or resolved.

Contact - the nature of the person-to-person contacts that take place.

Quality Objective
• Minimise cost
• Minimise the likelihood of defects, rework, scrap…..
• Based on the past – based on observation
Some past observations achieved via..

Lean. Focus in eliminating non-value added waste in a process with goal of

reducing process cycle times, improving on-time delivery performance and
reducing cost.

Six Sigma. Using statistical techniques to understand, measure and

reduce process variation with the primary goal of achieving improvements in
service quality and cost.
The chances of measurement points deviating from the
average is predictable in a normal distribution
Process control charting

LCL UCL
99.7% of
99.7% of points
points
-3 standard
-3 standard +3 standard
+3 standard
deviations
deviations deviations
deviations
95.4% of points
-2 standard +2 standard
deviations deviations
-1 standard +1 standard
Frequency

deviation deviation

68% of points

A standard
deviation
=
sigma
40 100 160
Elapsed time of call (seconds)
A six sigma process

LCL UCL
1 vs 3 vs 6 sigma level processes
The principles of Total Quality (TQ)
- a focus on the customer,
- to Involve everyone,
- to continuously improve,
are simple to understand and are common sense

Yet!
Many organisations have great difficulty in implementing these simple principles.
Such broad change required to implement TQ has been a major
stumbling block for many an organisation.

Research has shown that upwards of 70% of all change initiatives fail.

The journey to a TQ environment is not easy.

Why adopt a TQ Philosophy?

Reaction
• to competitive threat
• to profitable survival
• an opportunity to improve……

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The commitment to Performance Excellence

Three obstacles to the implementation of a quality-based strategy are cited as:

The lack of:

• strong motivation
• time to devote to quality initiatives
• a formalised strategic plan for change.

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The commitment to Performance Excellence

The lack of strong motivation:

An organisation will have more difficulty in gaining support for any significant
change when it is not facing a crisis.

When faced with a threat to survival, an organisation will implement change

more quickly and smoothly.

Complacency today will lead to a crisis tomorrow.

“If it aint broke, don’t fix it”
…..and then you have to!

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The commitment to Performance Excellence

The lack of time to devote to quality initiatives:

An organisation that cites a ‘lack of time’ to implement quality initiatives

better find lots and lots of time to:
- engage in fire-fighting,
- correct errors,
- re-work defective product
- waste time in complex and inefficient processes.

These organisations do not recognise Crosby’s philosophy that

Quality is Free

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The commitment to Performance Excellence

The lack of a formalised strategic plan for change:

Resulting from of lack of discipline and a fire-fighting mentality

inherent in the organisational culture.

No time to plan…… ……..don’t like change!!

So, there’s a need to sell the benefits of TQM to the ‘top table’……

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 Selling the TQ Philosophy

Interviews with previous Malcolm Baldridge National Quality Award winners cite
the following 10 ways that middle-management or a quality professional can
sell the TQM concept to senior management:

• Learn to think like top executives – what’s important to • Focus on getting an early win, even if it is small;
them….what are their priorities? • Ensure that efforts will be supported by corporate
• Position QUALITY as a way to address the priorities of accounting principles;
stakeholders; • Develop allies, both internally and externally;
• Align TQM objectives with those of senior management; • Develop metrics for return on quality and…..
• Make arguments quantitative; • Never stop selling the benefits of quality.
• Make the first pitch to someone likely to be sympathetic;

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Corporate Culture and Performance Excellence

Peters and Waterman’s best-selling book In Search of Excellence (1982)

popularised the concept of a ‘corporate culture’ - made the argument

that company success could be attributed to an organizational culture

that is decisive, customer-oriented, empowering, and people-oriented.

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Corporate Culture and Performance Excellence

The Corporate Culture is a company’s value system and its collection of

guiding principles: shared assumptions, values and beliefs that guide employees
on what is acceptable/appropriate behaviour.

Cultural values are presented in mission, vision and values statements.

For Quality and performance excellence to truly succeed in any organisation,

QUALITY must be recognised as a core element of the culture of the
organisation.

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Corporate Culture and Performance Excellence

Culture is by and large invisible to individuals.

Even though it affects all employee behaviours, thinking, and

behavioural patterns, individuals tend to become more aware of their

organization’s culture when they have the opportunity to compare it

to other organizations.

If you have worked in multiple organizations, you have witnessed this…..

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Corporate Culture and Performance Excellence

Maybe one organization you worked at was a place where:

• employees dressed formally;

• it was completely inappropriate to question your boss in a meeting

- such behaviours would only be acceptable in private;

• it was important to check your e-mail at night as well as during

weekends - or else you would face questions on Monday about where
you were and whether you were sick!

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Corporate Culture and Performance Excellence

Contrast this company to a second organization where:

• employees dress more casually;

• you are encouraged to raise issues and question your boss or peers, even in front of
clients. What is more important is not to maintain impressions but to arrive at the best
solution to any problem;

• it is widely known that family life is very important, so it is acceptable to leave work a bit
early to go to a family event;

• additionally, you are not expected to do work at night or over the weekends, unless
there is a deadline looming.
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Corporate Culture and Performance Excellence

These two hypothetical organizations illustrate that organizations

have different cultures, and culture dictates what is right and what
is acceptable behaviour …..as well as what is wrong and
unacceptable.
It sets you apart….
Includes dress codes and the ‘language’ of the industry

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Corporate Culture and Performance Excellence

The CORPORATE Culture is, therefore, a clear indicator of a TQM Culture if it respects the

worker – the right worker – which will reflect on:

• how the Customer is cared for and

• Productivity and, as a result…

• Performance Excellence

In a survey conducted by the management consulting firm Bain & Company in 2007,

worldwide business leaders identified corporate culture as being

as important as corporate strategy for business success.

(Why culture can mean life or death for your organization. (2007, September). HR Focus, 84, 9.)
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Corporate Culture and Performance Excellence

Having the “right” culture may give competitive advantage to

organizations, having the “wrong” culture may lead to

performance difficulties, may act as a barrier, preventing the

company from changing and taking risks and, ultimately, be

responsible for organizational failure.

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Corporate Culture and Performance Excellence

If a company is in the high-tech industry, having a culture that encourages innovation

and adaptability, will support its performance.

BUT, if a company in the same industry has a culture characterized by:

• stability,

• a high respect for tradition and

• a strong preference for upholding rules and procedures,

……the company may suffer as a result of its change-averse culture, in a constantly

changing industry. 56
 Levels of Corporate How it
Culture appears,
Artifacts
externally as
Shared well as
principles, Expressed internally:
standards, Values visible, tangible
and goals aspects of
organizational
culture.
Assumptions

Below our
consciousness:
These reflect beliefs about
human nature and reality
Organizational culture consists of three levels.
Source: Adapted from Schein, E. H. (1992). Organizational culture and leadership. San Francisco: Jossey-Bass
 Generally – what IS a Corporate Culture?

- The workplace ‘atmosphere’

- The vernacular,
- The dress code,
- The work ethic,
- The career path,
- The expectations the organisation has and promotes (therefore its staff and customers and
markets also have certain expectations)

A strong organisational brand translates into employee ‘fit’.

Facets of ‘Fit’ include the:
- Need for achievement,
- Level of work output,
- Social energy,
- Attitude.
 Key Idea

Organizational culture is a system of shared assumptions, values, and

beliefs that help individuals within an organization understand which
behaviours are and are not appropriate within an organization.

Cultures can be a source of competitive advantage for organizations. Strong

organizational cultures can be an organizing as well as a controlling
mechanism for organizations.

And finally, organizational culture consists of three levels: assumptions,

which are below the surface, values, and artifacts
 Corporate Culture and Performance Excellence

What are the characteristics of a culture of

performance excellence?

A premium is placed on excellence in performance:

- Organisations acknowledge that their success is dependent on the successful performance of their employees,
- Strategic planning drives work,
- They adopt a Process Approach – building relationships across the supply chain from supplier to customer
- Leadership is vital to success, Management is strongly committed to creating conditions that support and
sustain strong performance,
• Customer is central
• Continual improvement is critical – building quality in
• Decisions are based in proven, data-based, scientific fact 60
Organisational Culture is

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Any body recognise this scenario?

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Malcolm Baldridge National Quality Award - Core Values and Concepts

- Visionary leadership
- Customer Driven
- Organisational and personal learning
- Valuing employees and partners and
- Agility

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Malcolm Baldridge National Quality Award Core Values and Concepts

- Focus on the future,

- Managing for and with innovation,
- Management by fact,
- Social responsibility,
- Focus on results and creating value and
- Systems perspective.

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Cultural Change

- Change can be accomplished, but it is difficult

- Imposed change will be resisted
- Full cooperation, commitment, and participation by all levels of management is
essential
- Change takes time
- You might not get positive results at first
- Change might go in unintended directions

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Cultural Change – an example.

An example – Wainright Industries – manufacturer of parts for automotive, aerospace and other
industries
During the 1970’s & 1980’s, the organisation:
- Lost millions of dollars,
- Operations slowed to three days a week,
- Employee & Management tensions existed

Recognising that the problem lay with management, in 1991 the CEO made some radical changes.
- Workers were called “Associates”,
- Everyone was put on a salary.
- Associates were paid - even if they missed work and paid time and a half overtime,
- Managers shed their shirts and ties and a common uniform was introduced

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Cultural Change – an example.

- The associates developed a profit-sharing plan, with everyone receiving the same figure,
- All employees had access to the financial accounts,
- All reserved parking spaces were removed,
- Walls were replaced with glass and,
- Customers, both internally & externally, were treated as ‘partners’.

Wainwrights' culture can be summed up as:

A sincere belief and trust in people

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Cultural Change in 1991 – the results, by 1995.

- Work-related accidents dropped by 70%

- Freight costs dropped to less than 1% of sales…..from 2.5% of sales
- Sales almost doubled to $40m
- $6m debt reduced to $4.5m in 4 years
- 60% of all employees have been promoted
- Customer Satisfaction rate is up to 95% and growing….from c.75%

They won the MBNQA in 1994

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Key Idea

Impatient managers often seek immediate cultural change by adopting

off-the-shelf quality programs and practices, or by imitating other
successful organizations.

In most cases, this approach is setting themselves up for failure.

Organisations should maximise their own unique cultural strengths.
A successful Quality strategy needs to fit within the existing organisational
Culture.
No one ‘magic’ formula works for everyone.

Each organisation has a unique ‘Quality Engine’ that drives the organisation.

Company Quality Engine Focus

Wainwright People Empowerment Our people safe, engaged, educated and innovating
IBM Rochester Market-driven quality Customer needs determined early
Motorola Process control Defect prevention, Six Sigma
Xerox Benchmarking Competitive, best-in-class
FedEx Technology Improve customer service
Implementing Total Quality – the key players

Senior management
Middle management and
The Workforce

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 Implementing Total Quality – the key players

Juran (and others) suggest that an organisation must foster five key behaviours to develop a
positive quality culture

1 – It must create & maintain an awareness of quality by disseminating results throughout the
organisation.

2 – It must provide evidence of management leadership.

Examples may include - providing resources, championing quality ( e.g. Six Sigma) projects.

3 – The organisation must encourage self-development & empowerment through the design of
work and the development of empowered teams.

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 Implementing Total Quality – the key players

4 – The organisation must provide opportunities for employee

participation to inspire action, such as improvement teams

5 – The organisation must provide recognition and rewards, including:

public acknowledgement of good performance - extrinsic benefits….but also intrinsic benefits.

All these suggestions revolve around people - the most important element in a successful quality
organisation.

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 Implementing Total Quality – the key players

Senior management

Responsibilities should include:

- Ensuring the organisation is Customer-focused,
- Cascade the mission, vision & values right across the organisation,
- Identify the critical processes that need attention and improvement,
- Identify the resources & trade-offs that must be made to fund the TQ program,
- Review the progress and remove any barriers,
- Improve ….using the quality tools for problem solving.
NOTE: business environments are rapidly changing & leadership styles
have not kept pace

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 Implementing Total Quality – the key players

Middle management

Traditionally, Middle Management were not required to be leaders

- rather, the guardians of Generally Accepted Management Principles – GAMP

GAMP is no longer sufficient

Middle Management must now be Change Agents.
Transforming Middle Management into Change Agents involves a systematic approach involving:
• Empowerment – lower-level managers and employees are educated, trained, trusted and
accountable for performance,
• Creation of a common vision of ‘performance excellence’,
• Implementation of a continual improvement system
• Talent management - Development and retention of peak performers

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Implementing Total Quality – the key players

Leadership

If management is defined as getting things done through others,

then Leadership should be defined as inspiring action taken by
others through social and informal sources of influence - mobilizing
others to want to struggle toward a common goal.
Great leaders
• help build an organization’s human capital, then
• motivate individuals to take concerted action.
• possess an understanding of when, where, and how to use more
formal sources of authority and power, such as position or
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ownership.
 Implementing Total Quality – the key players

The Workers

If Total Quality does not occur at the workforce level, it will not occur at all.

The workforce implements the quality policy

This requires ‘ownership’
Ownership …or next-level Empowerment, gives the employee the right to have a voice in deciding what
needs to be done & how to do it.

Increased ownership requires increased sharing of information with all employees and a commitment to
them in both good and bad times.

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 Change Management

Change makes us uncomfortable.

So, managing Change is seldom a pleasant experience.
Managing Change requires a well-defined process, just like an other business process.

Most Change processes have three steps:

1 – question the present state and dislodge accepted patterns of behaviour, creating a state of urgency
2 – create a state of flux where new approaches are developed to replace the old.
3 – Institutionalising the new behaviours and attitudes.

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 Key Idea

Organisations contemplating change must answer some tough questions, such as:
• Why is the change necessary?
• What will it do to my organisation (department, job)?
• What problems will I encounter in making the change?
………..and perhaps the most important one,
• What’s in it for me?
 Key Idea

Numerous barriers exist to successfully transform organisations to a sustained culture of

total quality.

Understanding these barriers can help significantly in managing change processes.

Perhaps the most significant failure encountered in most organisations is a lack of

alignment and a lack of communication between components of the organisational
system….barriers in place.
 Common mistakes in TQ implementation

• Leadership is not bought in - Senior management not personally and visibly committed.
• TQM regarded as a “program”….it has a start……and a finish!
• Short-term results are expected…..and not obtained
• Not driven by (1) focus on customer, (2) connection to the strategic plan and (3) leadership
• Structural elements (established systems and policies) block the potential for change
• Goals are not aligned to strategy
• “Command and control” organisational culture undermines the whole ethos

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 Common mistakes in TQ implementation

• Training not properly addressed.

• Focus on products, not processes.
• Little real empowerment is given.
• The Organisation is too successful and becomes complacent.
• Organisation fails to address fundamental questions..

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 Common mistakes in TQ implementation

• Employees operate under belief that more data is always desirable.

• Management fails to recognise that quality improvement is a personal responsibility….for

everyone.

• The Organisation does not see itself as a collection of interrelated processes.

• The Quality Plan does not incorporate regular re-energizing and regeneration reviews.

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The Ongoing Challenge in Ford – the original home of LEAN – the first
production system in the world (for the Model T Ford)….1980 crisis, then
Deming…..2007 crisis the review Quality – 2012 Turnaround…..and it continues…

Ford created a middle class in the US - $5 a day wage – making affordable vehicles –
with his employees being his best customers!

Trust – in his workers and by his workers in their product

Respect – Fair pay
Fairness – Fair pay and affordable vehicles for all
Standardisation – the first production system for the Model T Ford – the start of Lean.
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The Ongoing Challenge in Ford
• Losses $14.8 billion in 2008; Debt $37 bn
• Profit $8.8 billion in 2011; Debt $14bn

• One Ford One Vision

• Improving quality, desirability and profitability

• Problem: Accountability – executives forced to know what was going on in

their businesses – get real about problems – make decisions based on
data….not their career aspirations!
How?
The
Key Elements
Ongoing Challenge in Ford

First: Leadership made the decision to turn it around – “advancements start with the
leadership teams” VP Ford World Quality
‘The VOC’ - eventually allowed it to work!
Leadership Team Behaviours to drive quality

Review: Quality Operating System – standardise, standardise, standardise…

Dedicated CI Teams
Dedicated ‘Variability Reduction’ Teams working on warranty claims info within 48 hrs
of claim being registered “Working on every claim every day”

Training:Give them the tools – lots of them

Understand the data
Understand the VOC
Understand Design and the input of VOC and Standards
Incorporate knowledge/experience of employees laid off in 2007/08

SCM: Risk Management

Partnership with suppliers and customers – comms, not logistics are key – Win:Win

…..and it starts again….. 89

 Views on Managers vs Leaders
My definition of a leader…is a man who can persuade people to do what
they don’t want to do, or do what they’re too lazy to do, and like it.
Harry S. Truman (1884–1972), 33rd president of the United States

You cannot manage men into battle. You manage things; you lead people.
Grace Hopper (1906–1992), Admiral, U.S. Navy

Managers have subordinates—leaders have followers.

Chester Bernard (1886–1961), former executive and author
of ’Functions of the Executive’

The first job of a leader is to define a vision for the organization…

Leadership is the capacity to translate vision into reality.
Warren Bennis (1925–2014), author and leadership scholar

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In summary, we have looked at:
- Why adopt a TQ Philosophy,
- A commitment to performance excellence,
- Selling the TQ philosophy,
- Corporate Culture and Performance Excellence,
- Organisational Culture,
- Cultural Change,
- Building on best practices,
- Implementing the TQ Philosophy,
- Common mistakes in TQ implementation.

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