UNIT V

QUALITY SYSTEMS

Need for ISO 9000 Quality System The ISO 9000 standards give organizations an opportunity to increase value to their activities and to improve their performance continually, by focusing on their major processes. The standards place great emphasis on making quality management systems closer to the processes of organizations and on continual improvement. As a result, they direct users to the achievement of business results, including the satisfaction of customers and other interested parties. The management of an organization should be able to view the adoption of the quality management system standards as a profitable business investment, not just as a required certification issue. Among the perceived benefits of using the standards are: The connection of quality management systems to organizational processes The encouragement of a natural progression towards improved organizational performance The adoption of a "process approach" emphasis of the role of top management requirements for the establishment of measurable objectives at relevant functions and levels being orientated toward "continual improvement" and "customer satisfaction", ISO 9000-2000 Quality System As quality became a major focus of businesses throughout the world, various organizations developed standards and guidelines. Terms such as quality management, quality control, quality system, and quality assurance acquired different, and sometimes conflicting meanings from country to country, within a country, and even within an industry. As the European Community moved toward the European free trade agreement, which went into effect at the end of 1992, quality management became a key strategic objective. To standardize quality requirements for European countries within the common market and those wishing to do business with those countries, a specialized agency for standardization, the International Organization for Standardization is found It is founded in 1946 and composed of representatives from the national standards bodies of 91 nations, adopted a series of written quality standards in 1987, which were revised in 1994, and again (significantly) in 2000. The most recent version is called the ISO9000:2000 family of standards.
Perspectives on ISO 9000:2000

ISO 9000 provides a set of good basic practices for initiating a quality system, and is an excellent starting point for companies with no formal quality assurance program. It provides detailed guidance on process and product control. Thus, for companies in the early stages of developing a quality program, the standards enforce the

discipline of control that is necessary before they can seriously pursue continuous improvement. The requirements of periodic audits reinforce the stated quality system until it becomes ingrained in the company. Thus, using ISO 9000 as a basis for a quality system can improve discipline, process, productivity, decrease costs, and increase customer satisfaction Elements The organizational culture needed to support TQ is one that values customers, improvement, and teamwork. In an organization with a TQ-friendly culture, everyone believes that customers are the key to the organizations future and that their need must come first. If two employees are having a conversation and a customer enters the shop, the conversation ends until the customer is served. Employees in a quality oriented culture instinctively act as a team. If someone is away from her desk and her phone rings, another employee will answer it rather than leave a customer hanging. Organizations where a focus on customers, continuous improvement, and teamwork are taken for granted have a good chance of succeeding at total quality. The criteria are built upon a set of core values and concepts. Visionary leadership. Customer-driven excellence, Organizational and personal learning, Valuing employees and partners, Agility, Focus on the future, Managing for innovation Management by fact, Public responsibility and citizenship. Focus on results and creating value, and systems perspective. Documentation: Documentation related to processes should support Identification and communication of significant features of the processes. Training in the operation of processes, sharing knowledge and experience in teams and work groups, .measurement and audit of processes, and Analysis, review and improvement of processes. The role of people within processes should be evaluated in order To ensure the health and safety of people, To ensure that the necessary skills exist, To support. Networks of processes, To provide for input of people in process analysis, and To promote innovation from people.

Quality auditing An organization should establish an internal audit process to assess the strengths and weaknesses of the Quality Management system. The audit process may also review the efficiency and effectiveness of other activities and support processes in the organization. The audit process should include the planning, implementation, reporting and follow-up activities related to internal audits. Planning for internal audits should be flexible in order to permit changes in emphasis based on findings and observations obtained during the audit Examples for consideration by internal auditing include: Existence of adequate documentation, Effective implementation of processes, Identification of nonconformance, Documentation of results, .competence of people, Opportunities for improvement, Capability of processes, Use of statistical techniques, Use of information technology, Analysis of quality cost data, Assigned responsibilities and authorities, Performance results and expectations, Adequacy and accuracy of performance measurement, Improvement activities, and Relationships with interested parties, including internal customers. In addition to documenting non-conformances, internal audit reporting could also indicate areas for improvement (with recommendations), as well as areas of outstanding performance. QS 9000 It is evolved by three auto giants of US, namely General Motors, Ford Chrysler. Initially this system is applicable only for suppliers of these auto manufacturers. Now it is adopted by worldwide automobile component manufacturers and auto manufacturers. QS 9000 covers all the areas of operation such as design, production, inspection, sales, marketing etc. The standards are stringent and strict enforcement is mandatory Wastage are to be minimized Manufacturing cost must be drastically reduces Benefits obtained should be passed on to the customers. In India most of the auto manufacturers received the certification Achieving the certification instills confidence among the customers A company can hire the services of a consultancy firm for taking advice on implementation program

 Management reviews and continuous improvement are the critical process of implementation program ISO 14000

ISO 1400 EMS Model

ANSI/ISO 14001-1996, vi i

Continual Improvement

Management review

Environmental policy Planning

Checking and corrective action

Implementation and operation

Organization of all kinds are increasingly concerned to achieve environmental policy and Objectives Many organization undertaken environmental reviews or audits to assess their environmental performance International standards covering environmental management are intended to provide organizations with the elements of an effective management system ISO 14000 specifies the requirements of such an environmental management system. It is applicable to all size and type of organization It is to accommodate diverse geographical, cultural and social conditions The success of the system depends on commitment from all levels and function, especially from top management Demonstration of successful implementation of this international standard can be used by an organization to assure interested parties that an appropriate environmental management is in place Concepts

Requirements and Benefits

Benefits: 1.Operational Benefits

Efficiency, discipline and operational integration with ISO 9000 Greater employee involvement in business operations with a more motivated workforce Easier to obtain operational permits and authorizations Assists in developing and transferring technology within the company Helps reduce pollution Fewer operating costs Savings from safer workplace conditions Reduction of costs associated with emissions, discharges, waste handling, transport & disposal Improvements in the product as a result of process changes Safer products

2. Environmental Benefits

Minimizes hazardous and non-hazardous waste Conserves natural resources - electricity, gas, space and water with resultant cost savings Prevents pollution and reduces wastage

3. Marketing Benefits

Demonstrates to customers that the firm has met environmental expectations Meets potential national and international government purchasing requirements Delivers profits from marketing "green" products Provides a competitive marketing tool Improves international competitiveness

4. Financial Benefits

Improves the organizations relationship with insurance companies Elimination of costs associated with conformance to conflicting national standards Process cost savings by reduction of material and energy input Satisfying investor / shareholder criteria Helps reduce liability and risk Improved access to capital

Requirements of ISO 14000 Top management shall define the organizations environmental policy and ensure that it a) is appropriate to the nature, scale and environmental impacts of its activities, products or services;

b) includes a commitment to continual improvement and prevention of pollution; c) includes a commitment to comply with relevant environmental legislation and regulations, and with other requirements to which the organization subscribes; d) provides the framework for setting and reviewing environmental objectives and targets; e) is documented, implemented and maintained and communicated to all employees; f) is available to the public Case studies of TQM implementation in manufacturing service sectors: This case study describes how one of the worlds most innovative and successful companies selected 1Tech to improve and integrate its IT processes and to transfer skills to Toyotas information systems community.

Toyota have developed a collection of processes and standards for use by their Information Systems department known as the Information Systems Methodology (ISM) and, within it, a further set of processes known as the Information Systems Project Methodology (ISPM) to manage both the software development lifecycle and the business processes which govern it. They have also chosen to implement the IBM Rational Unified Process (RUP) for software development and integration projects. At Toyota, all employees have two roles: their own job and quality assurance.

On each vehicle production line, a cord, known as the Andon cord, runs along the length of the line. If a line worker notices anything unusual, such as a defect, they pull this cord and the line stops. The team then concentrates all of their effort on correcting the defect before the line starts up again.

Toyota invented the concept of Just in Time in 1938 (often described as Just in time, stop the line). The objective was not simply to reduce inventory, as is often thought, but to avoid building up too much stock with defects which would have to be written off or corrected.

Just in Time and this culture of quality evolved into the Toyota Production System and its more generic equivalent, Lean Manufacturing, which is the benchmark for manufacturing organisations across the globe.

Toyota introduced Total Quality Management (TQM) as long ago as 1961 and was the first to introduce Kaizen (lit. improvement) to represent the concept of continuous improvement.

These concepts and the associated culture are practiced in every aspect of Toyotas operations, including information systems.

The Company

Toyota (GB) PLC is part of Toyota Motor Corporation the worlds seventh largest company and the second largest global car manufacturer. Importer and distributor for Toyota and Lexus vehicles in the UK, the company is responsible for sales, marketing, after sales and customer relations across its entire UK network of 200 Toyota Centres. 1Tech has been working with Toyota GB plc for a number of years on Information Systems solutions that span the companys business applications portfolio.

The Problem

Toyotas Information Systems Methodology (ISM) and Information Systems Project Methodology (ISPM) embody Toyota principles but they have not been institutionalised to the same degree as processes used in other parts of the business. In 2007, they introduced the IBM Rational Unified Process (RUP) to manage Business and Software Architecture and application development. RUP in fact resembles the Toyota Production System in many ways, with its focus on quality and team interaction and its architecture-centric approach.

Toyota work closely with IBM Global Services to ensure that the Kaizen principle of continuous improvement is applied to the management of its information systems. The implementation of the Rational Unified Process in any organisation is challenging and the time before it begins to produce positive results varies significantly, but is frequently measured in years rather than months. Working with IBM, Toyota tailored RUP to suit the environment (a prerequisite of any RUP adoption programme), but were having difficulties in institutionalising the process due to limited experience and skills. The implementation of RUP was further complicated by the need for it to operate within the boundaries of ISM and ISPM which in effect provided the interface to Toyota methods and the organisation in general. Part of Toyotas philosophy is the concept of the Extended Enterprise wherein they develop long term relationships with suppliers specifically targeted at mutual innovation. Whereas this was an integral part of all business and manufacturing operations, it was immature within information systems. This was a weakness, given a policy that it is better to buy something of proven quality than to risk developing something new. Toyotas first production pilot of RUP was the new Vehicle Management System which 1Tech had been engaged to implement some 12 months into the project (See Case Study Toyota decides to replace business-critical systems with open source business applications). At the time of 1Techs engagement the project was well behind schedule and over budget.

The Solution

1Tech's own Open Source Integration Methodology (1TechOSIM) is based on RUP and it soon became clear to Toyota that compared to their own implementation, the method was mature and was additionally backed up by the skills of the 1Tech team. 1Tech were therefore asked to extend their engagement to mentor and train Toyota staff in the efficient use of RUP. 1Tech identified the lack of methods to manage IS supplier engagement and the introduction of third party components and proposed the adoption of the Evolutionary Process for Integrating COTS-based Systems (EPIC), a methodology defined by the Software Engineering Institute and generally considered to represent best practice. Following a review of the current status of the ISM and ISPM methodologies with the resident IBM Global Services team, 1Tech were asked to integrate all of the information systems processes so that boundaries and interfaces were clearly defined and the whole could operate as a single, seamless entity, accessible to all information systems personnel.

The Result

1Tech worked with project and programme management to reconstruct the critical vehicle management system project, replacing the existing function-driven approach with one that was risk driven and architecture-centric according to RUP principles. This resulted in the identification of elements which represented the highest risk and focused on the need to eliminate these risks early so that the effects they might have on project timescales could be mitigated. The number of elements with high architectural risk was significant due to the number of interfaces to legacy systems which were needed. The development of instances of each commenced immediately and the risks were either eliminated or, where major problems occurred, the need to focus and reschedule effort on their resolution was identified. 1Tech analysed the use of the four information systems methodologies (ISM, IDSPM, RUP and EPIC) and produced a process architecture which integrated them into effectively a single process. The integrated processes, along with guidelines, templates and other supporting materials, were defined and published by 1Tech as a web site for Toyotas intranet using IBM Rational Method Composer, allowing each member of the information systems community, whether acting in a project, support or management role, to instantly see how they were expected to interact with their colleagues and the processes they should follow. 1Tech developed custom training material and trained all information systems staff, including senior management, via modular courses aimed at transferring skills appropriate to the needs of each individual. This was supplemented by onthe-job coaching, a technique which is itself a core Toyota philosophy. Training customisation and delivery, and process analysis, tailoring and integration, were completed within 3 months.

Conclusion Implementing a major new approach, such as the IBM Rational Unified Process, is a huge task for any organisation and requires a properly managed change programme in its own right. Integrating it with other processes at the same time magnifies the risk and the associated effort. By harnessing 1Techs extensive experience in these areas and their ability to produce pragmatic solutions, Toyota were able to radically reduce the time needed to realise benefits, whilst improving staff motivation by giving team members more control over and insight into the tasks for which they were responsible.