1. TOTAL QUALITY MANAGEMENT
Unit-2
Principles and philosophies of quality management
Presented by
N.Vigneshwari

2. Review of last class
Cost of quality

3. Today’s topic
Overview of the contributions of Deming

4. Overview of the contributions of Deming
About Deming
1928-awarded, was the senior quality guru
1946-after sharing his expertise in statistical quality control to help the US war effort during World War II, the war department sent Deming to Japan to help nation recover from its wartime losses.
1956-awarded the Shewhart medal by the American society for quality control
Deming was a prominent consultant, teacher, and author on the subject of quality. He has published more than 200 works, including well-known books ‘quality’, ‘productivity and competitive position’, and ‘out of the crisis’.

5. Deming’s contributions
Deming 14 points for management
Deming cycle (or PDCA cycle)
Seven deadly diseases of management

6. Deming’s 14 points for management
Create constancy of purpose for continual improvement of product and service
Adopt the new philosophy
Cease dependency on inspection to achieve quality
End the practice of awarding business on price tag alone
Improve constantly and forever the system of production and service
Institute training on the job
Institute leadership
Drive out fear
Breakdown barriers between department and individuals
Eliminate the use of slogans
Eliminate work standards on the factory floor
Remove barriers to pride of workmanship
Institute a vigorous program of education and retraining
Define top management’s permanent commitment to ever-improving quality and productivity.

7. Create constancy of purpose for continual improvement of product and service:
An organisation must define its values, mission and vision of the future to provide long-term direction for its management and employees
Deming believed that businesses are social entities whose basic purpose is to serve their customers and employees. To do this, they must take a long-term view and invest in innovation, training and research.
Adopt the new philosophy:
Companies cannot survive if products of poor quality of conformance or poor fitness for use leave their customers dissatisfied. Instead, companies must take a customer driven appraoch based on mutual co-operation between labour and management and a never-ending cycle of improvement. Everyone, from CEO to the lowest level employee of the organisation must recognise the need for a new philosophy to keep the firm and its functions alive and growing in today’s competitive environment and must learn the new philosophy

8. Cease dependency on inspection to achieve quality:
“Routine inspection acknowledges that defects are present, but does not add value to the product. Defects are inherent to any product or process, and we can hope to prevent those defects from reaching customers only by inspecting them”
Deming contradicted the above view, since inspections increase costs rather than reduce them and create more problems than they solve. The rework of defective products decrease productivity and in service industries, rework cannot be performed.
Workers must take responsibility for their work rather than leave the problems for the inspectors.
End the practice of awarding business on price tag alone:
Purchase departments have long been driven by cost minimisation, without regard to quality. Low prices are often associated with low quality, which can actually raise overall costs through increased expenses for inspection, scrap and rework, inventory to replace defective items and employee frustration. Managers must identify and assess all of the effects and costs created by every purchase and buy from the supplier that offers the lowest total cost.

9. Deming urged businesses to establish long-term relationships with a few suppliers, leading to loyalty and opportunities for mutual improvement. Constantly changing suppliers solely on the basis of price, increase the variation in the material supplied to production, since every supplier’s process is different.
Improve constantly and forever the system of production and service:
Whereas Western management has viewed improvement in the context of large, expensive technological innovations such as robotics and computer-integrated manufacturing, Japanese manufacturer’s success is primarily due to incremental improvements.
Improvements are necessary in both design and production. Improved design comes from understanding customer needs through continual market surveys and other sources of feedback. Also, understanding the manufacturing process and developing designs having producibility are essential to achieve improved design. Improved production is achieved by reducing the causes of variation and establishing stable, predictable processes.

10. Improvement means reducing variation by eliminating special causes and reducing the effects of common causes. This improves quality which in turn improves productivity and decreases costs. The special causes can be reduced by the efforts of workers, using statistical methods.
To build a system that can consistently produce a quality product, managers must identify and eliminate waste and variability throughout the system. Statistical methods can be used by managers to understand common causes and lead to their reduction.
Institute training on the job:
For continuous improvement, employees-both management and workers-require the proper tools and knowledge. People are an organisations’s most valuable resources and the management must take the responsibility of training them on their jobs so that they do a good job.
However, most firms view training as a requirement of newly hired employees only. Later, they implicitly and wrongly assume that the employees no longer need any training. The critical need to learn never ends. All employees should be trained in statistical tools for solving quality problems. Not only does training result in improvement in quality and productivity, but it adds to worker’s morale. In addition, training removes barriers between workers and supervisors, giving both more incentives to improve further.

11. Institute leadership:
The job of managers is leadership, not supervision. Supervision is simply overseeing and directing work, whereas leadership means providing guidance to help employees do their job better with less effort. Supervisors and managers must see themselves as teachers, coaches and facilitators who support the activities of workers in immediate contact with process problems. They must encourage and promoted teamwork and reward innovation and initiative. Leadership qualities in supervisors and managers can help to eliminate the element of fear from the job and encourage teamwork.
Drive out fear:
Deming identified fear as major obstacle to improve efficiency and effectiveness and a major barrier to change and survival. Fear is manifested in many ways: Fear of reprisal, fear of failure, fear of the unknown, fear of losing control and fear of change. Fear affects an operating system in many ways. Some people are afraid to ask questions and reveal weaknesses in their knowledge, fear of the perceived cost of failure, such as poor performance reviews or even termination, prevents some people from challenging current practices or trying new techniques. Many people simply fear change because it forces them to deal with new and unfamiliar methods in place of known and familiar, though inefficient methods

12. Workers are often afraid to report quality problems because they might not meet their quotas, their incentive earnings might be reduced, or they might be blamed for the problems in the system.
To drive out fear, managers must create an environment that encourages people to ask questions, report problems and try new ideas. Employees must know that the firm will not punish them if their new ideas fail. Managers must demonstrate the importance of trying something new that offers a chance for a major leap in effectiveness rather than sticking with safe methods that offer only stable or declining benefits.
Breakdown barriers between departments and individuals:
Many organisations tolerate weaknesses because they look at problems within strict functional limits and ignore insights and concerns raised by related functional areas.
Teamwork helps to break down barriers between departments and individuals. In Japan, firms emphasise that the next department or individual in the production process is actually the internal customer and train those workers to manage customers relationships. To overcome the barriers between individuals, managers must encourage teamwork by making changes such as moving work stations close together, assigning people to teams and changing the performance measurement system to reward group performance rather than individual results.

13. Eliminate the use of slogans:
Posters, slogans and motivational programs calling for ‘zero defects’, “improve productivity and quality” and so on are directed at the wrong people. These slick messages assume that all quality problems are due to human behaviour and workers can improve simply through such motivational methods.
Motivational methods overlook the source of many problems-the system rather than individual workers. Quality problems usually come form limits in the current system. Rather than using promotional messages designed to urge workers to work harder, managers should give them the tools and training they need to work smarter. The statistical thinking and training are the best route to improve quality. Motivation can be better achieved from trust and leadership than from slogans and goals.
Eliminate work standards on the factory floor:
Standards and quotas are born in short-term perspective and create fear of punitive action for not achieving them. They do not encourage improvement, particularly if rewards or performance appraisals are tied to meeting quotas. Workers may short-cut quality to reach the numerical quotas. Attempts to meet reasonable quotas lead to complacency overtime since workers achieve their goal and need do no more.

14. Excessively, demanding quotas discourage the workers who can never meet them, or induce them to compromise quality standards. Unreasonable quotas cause fear and frustration and leave room for improvement. TQM sets one ultimate task for any employee: to produce quality products.
Remove barriers to pride of workmanship:
Employees are not recognised as valuable human resources of the organisations in which they work. Workers are given monotonous tasks, provided with inferior machines, tools or materials, asked to work at odd hours and on holidays too to make up for the production delays and so on. Under these circumstances, many individuals cannot take pride in their work. Further, many cannot be certain about their job tenure, they have the fear of losing their jobs any time.
Deming believed that one of the highest barriers to pride in workmanship is performance appraisal. Performance appraisal destroys teamwork by promoting competition for limited resources, focusses on short-term and discourages risk taking.

15. Institute a vigorous program of education and retraining:
Continual training keeps the work force up-to-date with information about new developments, changes in product designs and machinery, new tools and procedures and innovative techniques. Organisations must invest in their people at all levels to ensure success in the long-term. Investment in training represents the firm’s ongoing commitment to its employees. Also developing the worth of the individual employee is powerful motivation method.
Define top management’s permanent commitment to ever-improving quality and productivity:
Top manager’s actions communicate the true importance of quality and TQM throughout the firm. The commitment of top managers to quality encourages many managers and employees to follow top managers towards personal and organisational success. For TQM to succeed, a firm’s top managers must publicly demonstrate their vigorous commitments to ensure continuous quality improvement and innovation and they must openly practice what they preach.

16. Deming wheel
To successfully practice total quality management in a firm, top managers must take the first step: accepting and committing themselves to the guidelines and points that form the basis of TQM. The firm can then begin to implement TQM using the Deming wheel.
Deming wheel or PDCA cycle:
ACT
PLAN DO
CHECK

17. The ‘Deming wheel’ or ‘Deming cycle’ which is also known as the PDCA cycle (Plan-Do-Check-Act) is a problems solving process adopted by firms engaged in continuous improvement (CI).
The cycle consists of the following steps:
Plan: What is needed
Do: It
Check: that it works
Act: to correct problems or improve performance
It is a universal improvement methodology, the idea is to constantly improve, and there by reduce the difference between the requirements of the customer and the performance of the process.
The cycle is about learning and ongoing improvement, learning that works and what does not in a systematic way; and the cycle repeats; after one cycle is complete, another is started

18. Deming’s seven deadly diseases and sins
Lack of constancy of purpose
Emphasis on short-term profits
Over reliance on performance appraisals
Mobility of management
Overemphasis on visible figures
Excessive medical costs for employee health care
Excessive costs of warranty and legal costs

19. Lack of constancy of purpose:
Many companies have only short-term quality programs. They do not look towards the long-term. For example: at one small plant, the plant manager stated vehemently that no one should ever compromise on quality. After sometime, a customer called for a rush order to meet his urgent needs and willing to take any product that the plant could ship irrespective of quality. The plant manager could not offer a batch of acceptable quality and decided to ship parts of inferior quality which the customer would accept. The schedule requests took precedence over quality, destroying the quality programme in practice.
Emphasis on short-term profits:
A process that focusses on short-term profits encourages short-term thinking and short-term actions. Managers may cut costs in the short-term while sacrificing the long-term planning that TQM demands and raising costs overall.

20. Over reliance on performance appraisal:
A performance appraisal system can hinder the implementation of TQM by encouraging rivalry, fear and short-term thinking. It can also destroys teamwork and mutual respect.
Mobility of management:
Managers who continually job-hop fail to understand the companies for which they work, focus on the short-term and are unable to implement the long-term changes necessary for lasting quality improvement. Even though it may be argued that job hopping exposes managers to a beneficial diversity of experiences, excessive job hopping encourages short-term thinking and inhibits the ability of the manager to understand the long-term implications of acitons.
Overemphasis on visible figures:
Managers tend to evaluate performance by looking only at measures that they can easily capture. But most important figures may be unknown or often unknowable, such as the effect of a satisfied customer. TQM requires the managers to evaluate the total effect of any action by reviewing both quantitative information like the number of defects and qualitative data like expressions of customer satisfaction or employee perception about the firm.

21. Excessive medical costs for employee health care:
Healthcare costs and rate of absenteeism due to illness have increased at a phenomenal rate over the years.
Excessive costs of warranty and legal costs:
Due to proliferation of law suits and multi-million-dollar judgments concerned with compensation to be paid to the patients, the medical professionals in US spend lot of money for paying insurance premium to cover the risk in practising their medical profession.

22. Thank you