Topic1-introduction To Quality And Performance Excellence 5q526x

Quality Management System (BPF 2123)

CHAPTER 1 INTRODUCTION TO QUALITY AND PERFORMANCE EXCELLENCE

1

By: Suziyana Mat Dahan 

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OUTLINE  

  

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Historical review Defining quality Importance of quality Quality dimensions Total quality management - Framework - Gurus - Principles - Benefits - Obstacles Performance excellence 2 By: Suziyana Mat Dahan 

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LESSON OUTCOMES L01

Able to describe the basic concepts of quality L02 Able to explain the principles, benefits and obstacles of Total Quality Management (TQM)

3 By: Suziyana Mat Dahan 

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HISTORICAL REVIEW Ages – quality controlled by long period of training to instilled pride in workers for quality of a product.

 Middle

 Industrial

revolution specialization.

–

introduce

concept

of

(1875) – pioneered division of labour. Workers have narrow view of the product (i.e. component). Initially created increases in productivity, but eventually led to losses in pride of workmanship (and hence quality) and, as a consequence, the need to improve productivity.

 Taylor

Established work standards, time studies and wage incentive plans, which raised productivity but tended 4 to stifle the pursuit of quality beyond the standards.





HISTORICAL REVIEW (CONT.) 

Shewhart (1924) at Bell Labs - developed a statistical chart (SQC) for controlling product variables.



He noted the positive relationship between consistency and quality. Detect a ―lack of control'' in processes through continual monitoring of variability



Deming (1950) - Helped in the reconstruction of Japanese industry; teach Japanese engineers SQC techniques and quality responsibility to Japanese CEOs.


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Juran (1940s-50s) - emphasized the role of top management for achieving quality. According to Juran organizational change, need management participation – ―managerial breakthrough''

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Feigenbaum (1951) - Total Quality Control : company-wide involvement

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Halpin (1960s) - Zero Defects : emphasized prevention of defects, but focus on improving the workforce rather than on management



Crosby (1979) - Quality is Free. He argued that quality programs save money (see for quality and costs – prevention costs, appraisal costs, internal costs & external costs) 6 By: Suziyana Mat Dahan 

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Ishikawa (1960s) - Professor of engineering at Univ. of Tokyo. Quality circles (QC): participative management; a team of workers forms and brainstorms on problems of productivity and quality. Use simple tools including histograms, pie charts, pareto diagrams, cause-and-effect diagrams.



Taguchi (1960s) - Emphasize offline QC, quality of design of processes and product. Don't wait until production to do QC. Idea : design product to withstand variations in quality of materials, labour, environment, etc. Find out what factors are critical (experimental design) and change design so that the product is more tolerantminimize the transmission of variance throughout the process (also called robust design). 7 By: Suziyana Mat Dahan 




DEFINING QUALITY Perfection

Fast delivery

Providing a good, usable product Consistency Eliminating waste Doing it right the first time Delighting or pleasing customers Total customer service and satisfaction Compliance with policies and procedures





FORMAL DEFINITIONS OF QUALITY “The totality of features and characteristics of a product or service that bears on its ability to satisfy given needs” (American Society for Quality)  Fitness for use  Meeting or exceeding customer expectations  Conformance to specifications


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MODERN QUALITY DEFINITION “Quality is inversely proportional to variability” Quality  1/Variability 

This definition acknowledges that variability is present in all processes. Sources of variability include: 1. Process variability includes raw materials, machines, operators and environmental conditions 2. Measurement variability 3. Sampling variability



Given that quality is inversely proportional to variability, so it means by improving quality, we will reducing variability. 10 By: Suziyana Mat Dahan 

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QUALITY CAN BE QUANTIFIED AS: Q = P/E where

Q = quality; P = performance E = expectations

If Q > 1.0 : then the customer has a good feeling about the product/service.  P and E are determined based on perception.  P is determined by the organization and E by the customers.  Customer expectations are becoming more demanding from day-to-day. 


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COMPONENTS OF QUALITY 1.

 



2.

  

Product features Have a major effect on sales outcome. The 9 dimensions are independent – a product can be excellent in one dimension and average / poor in another. These dimensions are then translated into the requirements for the development of a new product/the improvement of an existing one. Freedom from deficiencies Has a major effect on costs through reduction in scrap, rework, complaints etc. Deficiencies refer to errors, defects, failures, off-specification. Freedom form deficiencies means quality of conformance. 12 By: Suziyana Mat Dahan 

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



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IMPORTANCE OF QUALITY

1. Ensuring all products and services will ultimately be able to satisfy the needs of customers. 2. Helps company to reduce costs of production 3. Saves time and trouble dealing with production problems and customer dissatisfaction. 4. Leads directly to increased capability, productivity and profit. 5. Helps the company to perform its legal responsibility of a „duty of care‟ towards its customers.

Customer





IMPORTANCE OF QUALITY


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DIFFERENCES BETWEEN MANUFACTURING AND SERVICES 1.

2.

3. 4. 5.

6. 7.

Customer needs and performance standards are often difficult to identify and measure. The production of services typically requires a higher degree of customization. The output of many service systems is intangible. Services are produced and consumed simultaneously. Customers often are involved in the service process and present while it is being performed. Services are generally labor intensive. Many service organizations must handle very large numbers of customer transactions. 17 By: Suziyana Mat Dahan 




QUALITY DIMENSIONS IN MANUFACTURING 1. 2. 3.

4. 5. 6.

7. 8. 9.

Performance – primary product characteristics Features – secondary characteristics, added features Reliability – consistency of performance over time Conformance – degree to which characteristics match standards Durability - amount of use before deterioration or replacement Serviceability – resolution of complaints, ease of repair Aesthetics – look, feel, sound, taste, smell Response – human-to-human interface Reputation – past performance and other intangibles





QUALITY DIMENSIONS IN SERVICES 1. 2. 3. 4.

5.

6.

Time – how much time must a customer wait? Timeliness – will a service be performed when promised? Completeness – Are all items in the order included? Courtesy – do frontline employees greet each customer cheerfully? Consistency – are services delivered in the same fashion for every customer, and every time for the same customer? Accessibility and convenience – is the service easy to obtain? 19 By: Suziyana Mat Dahan 

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TOTAL QUALITY MANAGEMENT (TQM) 





Defined as a set of guiding principles that represent the foundation of a continuously improving organization. Is the application of quantitative methods and human resources to improve all the processes within an organization and exceed customer needs now and in the future. Purpose – to provide a quality product to customers, which in turn increase productivity and lower cost and enhance the competitive position in the marketplace.





TQM FRAMEWORK Shewhart Deming Juran Ishikawa

Gurus

Tools and Techniques

Principles and Practices

Product or Service Realization People & Relationships : Leadership Customer Satisfaction Employee Involvement Supplier Partnership Management by fact Strategic focus Continuous improvement

Benchmarking QMS EMS Products & Service Liability QFD FMEA TPM SPC Taguchi’s Quality Eng. Experimental Design

Customer Approach : Continuous Process Improvement Measure : Performance Measures

21


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GURUS OF QUALITY / TQM Gurus

Known For

Walter A. Shewhart

Statistical Process Control Chart and PDSA Cycle

W. Edwards Deming

Provide a theory for management to improve quality, productivity and competitive position (14 points)

Joseph M. Juran

Processes for Managing Quality

Armand V. Feigenbaum

Authored Total Quality Control

Kaoru Ishikawa

Development of the Cause and Effect Diagram, Quality Circle Concept (QCC)

Philip B. Crosby

Authored Quality Without Tears

Genichi Taguchi

Developed Loss Function Concept 22 By: Suziyana Mat Dahan 

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AWARENESS Improvements in quality can lead directly to increased productivity and other benefits  Example: 

Item

Relative total cost for 20 units Conforming units Relative cost for nonconforming units

Before Improvement 10% Nonconforming

After Improvement 5% Nonconforming

1.00

1.00

18

19

0.10

0.05

Productivity increase

100(1/18) = 5.6%

Capability increase

100(1/18) = 5.6%

Profit increase 100(1/18) = 5.6% TQM does not occur overnight; there are no quick remedies. It takes a long time to build the appropriate emphasis and techniques into the culture.

23


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PRINCIPLES OF TOTAL QUALITY MANAGEMENT 1. 2. 3. 4.

5. 6.

Customer and stakeholder focus Process orientation ed by continuous improvement and learning Employee engagement and teamwork Management by fact A strategic focus on quality as a source of competitive advantage Visionary leadership


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CUSTOMER AND STAKEHOLDER FOCUS  Customer

is the principal judge of quality  Organizations must build relationships with customers and increase customer engagement  Organizations must understand customer needs and obtain  Customers are internal and external


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CUSTOMER-FOCUSED PRACTICES

Identify the most important customer groups and markets  Understand both near-term and longerterm customer needs and expectations (the ―voice of the customer‖) and employ systematic processes for listening and learning  Understand the linkages between the voice of the customer and design, production, and delivery processes, and innovate 26 product offerings 


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CUSTOMER-FOCUSED PRACTICES 





Create an organizational culture and manage customer relationships Develop effective complaint management processes Measure customer satisfaction, engagement, and dissatisfaction and use the information for improvement


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PROCESS ORIENTATION  A process

is a sequence of activities that is intended to achieve some result


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CROSS-FUNCTIONAL PERSPECTIVE


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PROCESS-FOCUSED PRACTICES

Identify vital work processes that relate to an organization’s core competencies  Determine key work-process requirements  Design and innovate work processes to meet all requirements  Minimize overall costs associated with inspections, tests, and process or performance audits and prevent defects and errors  Improve work processes to achieve better performance 30 


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CONTINUOUS IMPROVEMENT AND LEARNING 



Incremental and breakthrough improvement: 1. enhancing value to the customer through new and improved products and services; 2. improving productivity and operational performance through better work processes and reductions in errors, defects, and waste; 3. improving flexibility, responsiveness, and cycle time performance; and 4. improving organizational management processes through learning Learning – why changes are successful through 31 between practices and results 



LEARNING CYCLE 1. 2. 3. 4.

Planning Execution of plans Assessment of progress Revision of plans based upon assessment findings


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EMPLOYEE ENGAGEMENT AND TEAMWORK 



Engagement – workers are actively involved in and committed to their work, feel that their jobs are important, know that their opinions and ideas have value, and often go beyond their immediate responsibilities for the good of the organization Empowerment – having the authority to make decisions


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ENGAGEMENT-FOCUSED PRACTICES 1.

2.

3.

4.

5. 6. 7.

8.

Understand the key factors that drive workforce engagement, satisfaction, and motivation Design and manage work and jobs to promote engagement Create an environment that ensures and improves workplace health, safety, and security Develop an effective performance management system Assess workforce engagement and satisfaction Assess workforce capability and capacity needs Make appropriate investments in development and learning 34 Manage career progression and succession planning By: Suziyana Mat Dahan 

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TEAMWORK

Vertical — teamwork between top management and lower-level employees.  Horizontal — teamwork within work groups and across functional lines (often called cross-functional teams).  Interorganizational — partnerships with suppliers and customers 


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MANAGEMENT BY FACT 

 

Organizations need good performance measures to drive strategies and change, manage resources, and continuously improve Data and information analysis at all levels Typical measures: customer, product and service, market, competitive comparisons, supplier, employee, cost and financial


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DATA-DRIVEN PRACTICES

Select, collect, align, and integrate data and information for tracking daily operations and overall organizational performance  Select and ensure the effective use of comparative data and information  Review organizational performance and capabilities  Translate organizational review findings into priorities for continuous and breakthrough improvement 





DATA-DRIVEN PRACTICES

Make needed data and information available and accessible  Ensure that hardware and software are reliable, secure, and -friendly  Ensure that organizational data, information, and knowledge are accurate, reliable, timely, secure, and confidential  Manage organizational knowledge  Keep performance measurement systems, hardware, and software current with business needs and directions 


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STRATEGIC FOCUS

Organizations must make long-term commitments to its stakeholders  Quality should drive strategic plans along with financial and marketing objectives  Long-term organizational sustainability and competitiveness are key strategic issues 


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STRATEGIC-FOCUSED PRACTICES 1.

2. 3.

4.

5.

Understand the organization’s operating environment Understand the competitive environment Gather and analyze relevant data and information (SWOT) Develop and refine a systematic approach for conducting strategic planning Develop and align short-term action plans with long-term strategic objectives 40 By: Suziyana Mat Dahan 

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STRATEGIC-FOCUSED PRACTICES 6.

7.

8. 9.

Derive the human resource plans required to accomplish longer-term strategic objectives Identify key measures or indicators for tracking progress on action plans Determine the organization’s core competencies View the work performed within the organization as a system


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VISIONARY LEADERSHIP

Leadership is the responsibility of top management  Senior leaders should be role models for the entire organization  An organization cannot sustain quality initiatives without strong leadership 


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LEADERSHIP PRACTICES 1.

2. 3.

4. 5. 6. 7.

Setting organizational vision and values and deploying them through the organization’s leadership system Demonstrating a commitment to organizational values Promoting an organizational environment that fosters, requires, and leads to legal and ethical behavior Creating a sustainable organization Creating an environment for organizational performance improvement Creating an environment for organizational and 43 workforce learning Personally participating in succession planning


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LEADERSHIP PRACTICES 8.

9.

10.

11.

12. 13.

14. 15.

Communicating with and engaging the entire workforce Encouraging frank, two-way communication Taking an active role in reward and recognition programs Creating a focus on action to accomplish the organization’s objectives Reviewing performance Creating and balancing value for customers and other stakeholders Evaluating their own performance to improve 44 Contributing to ing and strengthening key communities


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BENEFITS OF TQM The benefits of TQM are improved:  Quality  Employee Participation  Teamwork  Working Relationships  Customer Satisfaction  Employee Satisfaction  Productivity  Communication  Profitability  Market Share


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OBSTACLES OF TQM Lack of Management Commitment  Inability to Change Organizational Culture  Improper Planning  Lack of Continuous Training and Education  Incompatible Organizational Structure and Isolated Individuals and Departments  Ineffective Measurement Techniques and Lack of Access to Data and Results  Paying Inadequate Attention to Internal and External Customers  Inadequate Use of Empowerment and Teamwork  Failure to Continually Improve 


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PERFORMANCE EXCELLENCE  An

integrated approach to organizational performance management that results in: 1. delivery of ever-improving value to customers and stakeholders, contributing to organizational sustainability, 2. improvement of overall organizational effectiveness and capabilities, and 3. organizational and personal learning. 47 By: Suziyana Mat Dahan 

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