Contents

Introduction ................................................................................................................................ 2
Continuous improvement ........................................................................................................... 3
What is the PDCA? ................................................................................................................ 3
What does a PDCA cycle do? ................................................................................................ 5
Six Sigma ................................................................................................................................... 6
Six Sigma DMAIC Process:................................................................................................... 8
Employee Empowerment ......................................................................................................... 11
Techniques for building employee empowerment include .................................................. 12
Benchmarking .......................................................................................................................... 13
Just-in-Time ............................................................................................................................. 15
Taguchi Concept ...................................................................................................................... 16
Total Quality Management ...................................................................................................... 19
Benefits of good quality ....................................................................................................... 20
Consequences of Poor Quality ............................................................................................. 20
References ................................................................................................................................ 21

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Introduction

In this era of globalisation and intense competition, the concept of ‘total quality’ becomes
extremely important, not only in manufacturing sector of industry but also in the service
sector.

‘Total quality’ means that the services offered, have to be internally efficient and externally
effective. The aim and philosophy of TQM is not the measurement of quality performance
but the continuing and continual improvement of quality through a process of cultural and
organisational change. It is people driven and results are evident in terms of improved
teamwork, company moral and organisational climate – resulting in improved productivity
and profitability (Mohanty and Behera, 1996). TQM aims to connect to the customer at every
stage of the business process and is the key mantra for manufacturing industries as well as for
the customer-oriented service industries. Implementation of quality initiatives using TQM,
Six Sigma, just-in-time (JIT), etc., in manufacturing has increased operational efficiency,
brought down manufacturing costs and made companies strategically competitive in many
countries.

A large number of contemporary organisations across the globe are adopting total quality
management (TQM) to satisfy and delight their customers. The need for TQM is to provide
quality products and responsive services in order to gain competitive advantage and to
enhance customer lifetime value

The assignment discusses and provides an overview of TQM implementation, its implications
for the production of goods and or services and investigates six concepts of TQM.

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Continuous improvement

Continuous improvement is a philosophy that seeks to improve all factors related to the
process of converting inputs into outputs on an ongoing basis.

Continuous improvement is an ongoing effort to improve products, services or processes.

These efforts can seek “incremental” improvement over time or “breakthrough” improvement
all at once.

The basis of the philosophy is that every aspect of an operation can be improved. The end
goal is perfection, which is never achieved but always sought.

Among the most widely used tools for continuous improvement is a four-step quality
model—the plan-do-check-act (PDCA) cycle, also known as Deming Cycle or Shewhart
Cycle:

What is the PDCA?

PDCA, sometimes called the "Deming Wheel," "Deming Cycle," or PDSA was developed by
renowned management consultant Dr William Edwards Deming in the 1950s. Deming
himself called it the "Shewhart Cycle," as his model was based on an idea from his mentor,
Walter Shewhart

Deming wanted to create a way of identifying what caused products to fail to meet customers'
expectations. His solution helps businesses to develop hypotheses about what needs to
change, and then test these in a continuous feedback loop.

PDCA is an iterative, four-stage approach for continually improving processes, products or

services, and for resolving problems. It involves systematically testing possible solutions,
assessing the results, and implementing the ones that are shown to work

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Figure 1 Deming Shewhart's PDCA Model

A. Plan: Identify an opportunity and plan for change.

 Establish the objectives and goals of the task to be improved or developed.
 Describe the task in detail with clear specifications
 Develop a team that will be a part of the PDCA and set the deadlines
 Note down the data to be used, resources that will be
needed, cost expected, risks and mitigating
steps, manpower required, support needed from management.
 Draw an implementation plan with breakdown of each task, owner, expected
outcome, operating procedure or guidelines etc

B. Do: Implement the change on a small scale.

 As per the implementation plan, perform all the tasks.
 Keep the stakeholders informed of the progress
 Adhere to the schedule and highlight any significant concerns and variations
noted.

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 C. Check: Use data to analyse the results of the change and determine whether it
made a difference.
 One the activity is performed, validate whether the outcome is as intended and
planned.
 Make a note of all variations, defects, best practices, pain areas and challenges
faced
 Identify the root causes for the problems

D. Act: If the change was successful, implement it on a wider scale and

continuously assess your results. If the change did not work, begin the cycle
again.
 Correct the defects and make it comply to the specifications
 Identify the preventive actions for all the root causes identified
 Implement the preventive actions and check whether the outcome is as expected.
 Repeat the steps Do-Check-Act until all of the objectives are met to the
satisfaction of the stakeholders.

Thus the PDCA cycle will help in improving the performance of a process stage by stage in a
steady and levelled manner.

What does a PDCA cycle do?

PDCA cycle advocated by Deming finds an important place in continual improvement. It
helps a process to improve its performance on a staged and steady manner. The four steps
Plan, Do, Check and Action should be repeated over time to ensure continuous learning and
improvements in a function, product or process.

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Six Sigma

Six Sigma (6σ) is a set of techniques and tools for process improvement. It was introduced by
engineer Bill Smith while working at Motorola in 1986, in response to customer complaints
about its products and in response to staff complaints. Motorola set a goal of reducing defects
by 90%. Within one year, it had achieved such impressive results- through benchmarking
competitors, soliciting new ideas from employees, changing reward plans, adding training
and revamping critical processes that is documented. Although the six sigma concept was
rooted in manufacturing, Jack Welch made it central to his business strategy at General
Electric in 1995 by expanding into services, including human resources, sales, customer
services and financial services.

Six Sigma is a system of statistical tools and techniques focused on eliminating defects and
reducing process variability. The Six Sigma process includes measurement, improvement and
validation activities. The designation, or title, Six Sigma, relates to the connection between
the number of defects per million opportunities and the number of standard deviations found
within a process specification.

It seeks to improve the quality of the output of a process by identifying and removing the
causes of defects and minimizing variability in manufacturing and business processes. It uses
a set of quality management methods, mainly empirical, statistical methods, and creates a
special infrastructure of people within the organization who are experts in these methods.

Six Sigma has two main meaning in total quality management:

 The statistical representation of Six Sigma describes quantitatively how a process is

performing. To achieve Six Sigma, a process must not produce more than 3.4 defects
per million opportunities. A Six Sigma defect is defined as anything outside of
customer specifications. A Six Sigma opportunity is then the total quantity of chances
for a defect. In a statistical sense, it describes a process, product, or service with an
extremely high capability (99.99997% accuracy), For example if 1 million passengers
pass through Sangster International Airport with checked luggage each month, a six
sigma program for baggage handling will result in only 3.4 passengers with misplaced
luggage.
 The fundamental objective of the Six Sigma methodology is the implementation of a
measurement-based strategy that focuses on process improvement and variation

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 reduction through the application of Six Sigma improvement projects. Is a program,
designed to reduce defects to help lower costs, save time and improve customer
satisfaction.

Six Sigma is a comprehensive system-strategy, a discipline, and a set of tools- for achieving
and sustaining business success.

 It is a strategy because it focusses on total customer satisfaction

 It is a discipline because it follows the formal six sigma improvement model known
as DMAIC
 It is a set of seven tools- check sheets, scatter diagrams, cause and effect diagrams,
Pareto charts, histograms and statistical process control

It is based on the application of certain tools and techniques to selected projects to achieve
strategic business results. In the business world, six sigma programs have become a key way
to improve quality, save time. Cut costs, and improve customer satisfaction. Six sigma
programs can be employed in design, production, service, inventory management, and
delivery. It is important for six-sigma projects to be aligned with organisation strategy.

There are management and technical components of six-sigma programs. The management
component involves providing strong leadership, defining performance metrics, selecting
projects likely to achieve business results, and selecting and training appropriate people.

The technical component involves improving process performance. Reducing variation.

Utilizing statistical methods, and designing a structural improvement strategy, which involves
definition, measurement, analysis, improvement, and control.

For six sigma to succeed in any organisation, buy-in at the top is essential. Top management
must formulate and communicate the company’s overall objectives and lead the program for
a successful deployment.

Each Six Sigma project carried out within an organization follows a defined sequence of
steps and has specific value targets, for example such as reducing defects, reducing costs.
Reducing product and or process variability, reducing delivery time. Increasing productivity,
or improving customer satisfaction and increase profits. The process is to define, measure,
analyse, improve, and control (DMAIC)

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The Six Sigma DMAIC process (define, measure, analyze, improve, control) is an
improvement system for existing processes falling below specification and looking for
incremental improvement. All of the DMAIC process steps are required and always proceed
in the given order.

Six Sigma DMAIC Process:

Define

The purpose of this step is to clearly articulate the business problem, goal, potential
resources, project scope and high-level project timeline. This information is typically
captured within project charter document.

Measure

The purpose of this step is to objectively establish current baselines as the basis for
improvement. This is a data collection step, the purpose of which is to establish process
performance baselines.

Analyze

The purpose of this step is to identify, validate and select root cause for elimination.

Improve

The purpose of this step is to identify, test and implement a solution to the problem; in part or
in whole.

Create

Focus on the simplest and easiest solutions

Here are examples of Six Sigma tools that have always been helpful in reducing error level
and obtaining optimum benefits from the projects.

 Brainstorm: This is an example of a Six Sigma tool which allows the employees of a
company think innovatively and come up with suggestions and ideas for the
improvement of the company. The ideas often help the company to derive effective
solutions for various critical situations.
 Affinity Diagram: This is the tool which helps sorting out the best ideas from the ones
provided by people.

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 Histogram: This is a sort of a bar chart that helps estimating and evaluating the data
collected from various aspects of the system.
 Pareto Charts: The Pareto chart is an example of Six Sigma application tool that helps
short-listing the causes of different problems, which is one of the easiest ways to
solve them as the effort is reduced.

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Employee Empowerment

Managers are expected to gain employee’s trust, encourage employees’ problems solving,
and promote co-operation among departments for improved communications through flatter
organizations and quicker decision making.

Empowerment is a concept that links individual strengths and competencies, natural helping
systems and proactive behaviour to social policy and social change. In the other words,
empowerment links individual and his or her well-being to wider social and political
environment in which he or she functions.

Employee empowerment is giving workers the responsibility for improvements and the
authority to make changes to accomplish them, and provides strong motivation for
employees. This puts decision making into the hands of those who are closest to the job and
have considerable insight into problems and solutions identifying the best course of action
and imitative steps to meet customer requirements. Empowerment of employees is not
without bounds or limitations. It should be structured and planned to achieve the goal of the
organisation. The employees should be aligned with business direction as brought out in the
vision and mission statements by the CEO. They have to understand their performance
boundaries and expected performance / results. An employee owns his processes; it means
employees themselves improve the quality of their processes, while the management is
watching and is ready to help them when needed. Therefore, empowering means that they
should do what they are authorised to do and with management approval before making
changes.

Employee empowerment does not mean that the management has no role to play or no
responsibility. In fact, the management has more responsibilities. They have to monitor the
skills continuously required for carrying out the ever-changing complexity of jobs of the
teams. The management must be willing to help the teams when they are unable to solve
issues. The responsibilities of the management are to control the processes and not the
individual team members. The employees should be encouraged to their own responsibility
and top management should help them to achieve it.

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Techniques for building employee empowerment include:

 Building communications networks that include employees

 Developing open, supportive supervisors
 Moving responsibility from managers and staff to production employees
 Building high-morale originations, and
 Creating such formal organisation structures as teams and quality circles

An example of this is allowing each representative a dollar amount that he is authorized to

refund customers to solve a customer service issue. These decisions should be monitored and
reviewed to make sure that the representatives are making choices that help the company,
rather than always benefiting the customers.

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Benchmarking

Benchmarking is the process of measuring an organisation’s performance on a key customer

requirement against the best in the industry, or against the best in any industry.
Benchmarking is a way of discovering what is the best performance being achieved –
whether in a particular company, by a competitor or by an entirely different industry. This
information can then be used to identify gaps in an organization’s processes in order to
achieve a competitive advantage. Its purpose is to establish a standard against which
performance is judged, and to identify a model for learning how to improve. A benchmark
demonstrates the degree to which customers of other organisations are satisfied. Once a
benchmark has been identified, the goal is to meet or exceed that standards through
improvements in appropriate processes.

Three Primary Classifications of Benchmarking

Although there are many forms of benchmarking, they can be classified into three categories
– internal, competitive and strategic.

Internal benchmarking is used when a company already has established and proven best
practices and they simply need to share them. Internal benchmarking also may be necessary if
comparable industries are not readily available.

Competitive benchmarking is used when a company wants to evaluate its position within its
industry. In addition, competitive benchmarking is used when a company needs to identify
industry leadership performance targets.

Strategic benchmarking is used when identifying and analysing world-class performance.

This form of benchmarking is used most when a company needs to go outside of its own
industry. These benchmarks are obtained from outside industries

The benchmark process usually involves these steps:

 Determine what to benchmark

 Form a benchmark team
 Identify benchmarking partners
 Collect and analyse benchmarking information
 Take action to match or exceed the benchmark

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Typical performance measures used in benchmarking include:

 Percentage of defects
 Cost per unit or per order
 Processing time per unit
 Service response time
 Return on investment
 Customer satisfaction rates and
 Customer retention rates

Almost any activity can be benchmarked. Even the most complex activities can be broken
down into component steps or parts for comparison with those in organisations demonstrating
good practice. Even processes that are not directly comparable with those in other
organisations can be benchmarked using Functional Benchmarking.

You can compare the UWI Open Campus department’s student recruitment, progression and
performance data externally or internally, as a point of departure for asking questions about
curriculum delivery.

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Just-in-Time

Just-in-Time (Lean) systems are sometimes referred to as just-in-time systems owing to their
highly coordinated activities and delivery of goods that occur just as they are needed. The
lean approach is being applied in a wide range of manufacturing and service operations.

Just-in-Time is both a philosophy and a methodology that focuses on eliminating waste (non-
value-added activities) and streamlining operations by closely coordinating all activities.
Lean systems have three basic elements:

 They are demand driven

 Are focused on waste reduction and
 Have a culture that is dedicated to excellence and continuous improvement.

Represents a philosophy that encompasses every aspect of the process, from design to after
the sale of a product. The philosophy is to pursue a system that functions well with minimal
levels of inventories, minimal waste, minimal space, and minimal transactions.

A Just-in-Time system must be a system that is not prone to disruptions and is flexible in
terms of the product variety and range of volume it can handle.

In Just-in-Time system, quality is ingrained in both the product and the process.
Organisations that use Just-in-Time systems have achieved a level of quality that enables
them to function with small batch sizes and tight schedules. Just-in-Time systems have high
reliability; major sources of inefficiency and disruption have been eliminated, and workers
have been trained not only to function in the system but also to continuously improve it.

The ultimate goal of a Just-in-Time system is to achieve a system that matches supply to
customer demand; supply is synchronized to meet customer demand in a smooth,
uninterrupted flow.

Nearly all fast food chains have moved to using a JIT inventory system. An example of this is
Burger King, where all the necessary ingredients for preparing hamburgers, such as meat,
buns and condiments, are kept on hand, but the actual hamburgers are only prepared when a
customer places an order. This contrasts with an inventory system that has premade
sandwiches already prepared.

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Taguchi Concept

Most quality problems are the results of poor product and process design. Genichi Taguchi
provides three concepts aimed at improving both product and process quality:

 quality robustness
 quality loss function and
 target-oriented quality

Quality robust products are products that can be produced uniformly and consistently in
adverse manufacturing and environmental conditions. Taguchi’s idea is to remove the effects
of adverse conditions instead of removing the causes. Taguchi suggest that removing the
effects is often cheaper than removing the causes and more effective in producing a robust
product. In this way, small variations in materials and process do not destroy product quality.

A quality loss function (QLF) identifies all costs connected with poor quality and shows how
these costs increase as the product moves away from being exactly what the customer wants.
These costs include not only customer dissatisfaction but also warranty and service costs;
internal inspection, repair, and scrap costs, and costs that can best be described as costs to
society,

L=D2C

Where L = loss to society

D2= square of the distance from the target value

C= cost of the deviation at the specification limit

Target-oriented quality is philosophy of continuous improvement to bring the product exactly

on target.

The Taguchi Method of quality control is an approach to engineering that emphasizes the
roles of research and development, product design and product development in reducing the
occurrence of defects and failures in products. The Taguchi method considers design to be
more important than the manufacturing process in quality control and tries to eliminate
variances in production before they can occur.

Taguchi has developed two-step process:

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  Optimizing the design of the product or process by manufacturing the product in the
best manner most of the time with less deviation from the target
 To design product and process insensitive to the influence of uncontrollable factors in
ensuring produced products are identical (less variation between the products)

The Taguchi Method gauges quality as a calculation of loss to society associated with a
product. In particular, loss in a product is defined by variations and deviations in its function
as well as detrimental side effects that result from the product. Loss from variation in
function is a comparison of how much each unit of the product differs in the way it operates.
The greater that variance, the more significant the loss in function and quality.

A real life example of the Taguchi Loss Function would be the quality of food compared to
expiration dates.

If you purchase an orange at the supermarket, there is a certain date that is ideal to eat it. That
would be the target date. There will also be limits for when to eat the orange (within three
days of the target date, Day 2 to Day 8).

For this example, Day 5 represents the target date to eat the orange. That is when the orange
will taste the best (customer satisfaction).

You purchase the orange on Day 1, but if you eat the orange you will be very dissatisfied, as
it is not ready to eat. This would fall below the lower limit. On Day 3 it would be acceptable
to eat, but you are still dissatisfied because it doesn’t taste as good as eating on the target
date. If you wait for Day 5, you will be satisfied, because it is eaten on the ideal date. If you
wait until Day 7, you will be slightly dissatisfied, because it is one day past the ideal date, but
it will still be within the limits provided by the supermarket. If you wait until Day 9, you will
be very dissatisfied, as it will be too far past the ideal date.

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You are slightly dissatisfied from Day 2 through 4, and from Day 6 through 8, even though
technically you are within the limits provided by the supermarket. The least amount of
dissatisfaction occurs on the target date, and each day removed from the target date incurs
slightly more dissatisfaction. Contrary to most discussions around specification limits, you
are NOT completely satisfied from Days 2 through 8, and only dissatisfied on Day 1 and 9.

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Total Quality Management

Total Quality Management (TQM) refers to a quest for quality that encompasses the entire
organisation, from supplier to customer. (TQM) stresses a commitment by management to
have a continuing companywide drive towards excellence in all aspects of products and
services that are important to the customer.

There are three key philosophies in this approach. One is a never-ending push to improve,
which is referred to as continuous improvement the second is the involvement of everyone on
the organisation; and the third is a goal of customer satisfaction, which means meeting or
exceeding customer expectations. TQM expands the traditional view of quality- looking at
the quality of the final product or service- to looking at the quality of every aspect of the
process that process that produces the product or service. TQM systems are intended to
prevent poor quality from occurring.

The TQM approach is as follows:

1. Find out what customers want. This might involve the use of surveys, focus groups,
interviews, or some other technique that integrates the customer’s voice in the
decision-making process. Be sure to include the internal customer (the next person in
the process) as well as the external customer (final customer)
2. Design a product or service that will meet (or exceed) what customers want. Make it
easy to use and easy to produce.
3. Design processes that facilitate doing the job right the first time. Determine where
mistakes are likely to occur and try to prevent them. When mistakes do occur, find out
why so that they are less likely to occur again. Strive to make the process “mistake –
proof”. This is sometimes referred to as a fail-safing: Elements are incorporated in
product or service design that make it virtually impossible for an employee (or
sometimes a customer) to do something incorrectly. The Japanese term for this is
pokayoke. Examples include parts that fit together one way only and appliance plugs
that can be inserted into a wall outlet the correct way only
4. Keep track of results, and use them to guide improvements in the syatem. Never stop
trying to improve
5. Extend these concepts throughout the supply chain

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Implications

Benefits of good quality

 Organisations with excellent TQM benefit in a variety of ways:
 An enhanced reputation for quality
 The ability to command premium prices
 An increased market share
 Greater customer loyalty
 Lower liability costs
 Fewer production/ service problems- which yields higher productivity
 fewer complaints from customers
 Lower production costs and
 Higher profits

Consequences of Poor Quality

1. Loss of business: Quality will show up in perceptions about the firm’s new products,
employment practices, and supplier relations. Poor designs or defective products or
services can result in loss of business. Failure to devote adequate attention to quality
can damage an organisation’s reputation and lead to a decreased share of the market
2. Product liability: Legislations are set out by the court of the land to hold
organisations that design, produce, or distribute faulty products or services liable for
damages or injuries from their use
3. Global Implications: To compete effectively in the global economy, products must
meet global quality, design, and price expectations. Inferior products harm a firm’s
profitability.
4. Productivity: Poor quality can adversely affect production during manufacturing
process, if parts are defective and have to be reworked or scrapped, thereby reducing
the amount of usable output for a given amount of input, similarly poor service can
mean having to redo the service and reduce service productivity.
5. Cost to remedy a problem: The earlier a problem is identified in the process, the
cheaper the cost to fix it. The cost to fix a problem at the customer end has been
estimated at five time the cost to fix a problem at the design or production stages

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References

Stevenson, J. William. (2012). Operations Management. Eleventh Edition

Heizer, Jay & Render Barry. (2014). Operations Management: Sustainability and Supply
Chain Management. Eleventh Edition

http://leansixsigmadefinition.com/glossary/taguchi-loss-function/
https://www.isixsigma.com/methodology/benchmarking/understanding-purpose-and-use-
benchmarking/

https://www.researchgate.net/publication/247834302_Studying_the_impact_of_total_quality
_managment_in_service_industries

http://asq.org/learn-about-quality/continuous-improvement/overview/overview.html

https://www.mindtools.com/pages/article/newPPM_89.htm

https://doi.org/10.1007/s40037-012-0006-3

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