© prentice hall, 2002 22 - 1 modern management 9 th edition

© Prentice Hall, 2002 22 - 1

Modern Management9th edition

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Objectives

• An understanding of the relationship between quality and total quality management

• An appreciation for the importance of quality

• Insights into how to achieve quality

• An understanding of how strategic planning can be used to promote quality

• Knowledge about the quality improvement process.


FUNDAMENTALS OF QUALITY

Defining Total Quality Management

The Importance of QualityArmand V. Feigenbaum (1990): “Quality. Remember it?”

High-quality goods and services results in:1. A positive company image

2. Lower costs and higher market share3. Decreased product liability costs

Positive Company Image

Lower Costs and Higher Market Share

Decreased Product Liability Costs

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Figure 22.1TQM typically results in lower costs and greater market share

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Established Quality AwardsDeming Award

Malcolm Baldrige National Quality Award

Shingo Prize for Excellence in American Manufacturing

Healthcare Forum/Witt Award: Commitment to Quality

Achieving Quality

Crosby’s Guidelines for Achieving Quality

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Table 22.1Crosby’s Vaccination Serum for

Preventing Poor Total Quality ManagementIntegrityA. The chief executive officer is dedicated to having the customer receive what was promised, believes that the company will prosper only when all employees feel the same way, and is

determined that neither customers nor employees will be hassledB. The chief operating officer believes that management performance is a complete function requiring that quality be “first among equals”—schedule and costC. The senior executives, who report to those in A and B, take requirements so seriously that they cannot stand deviationsD. The managers, who work for the senior executives, know that the future rests with their abilities to get things done through people—right the first timeE. The professional employees know that the accuracy and completeness of their work determine the effectiveness of the entire workforceF. The employees as a whole recognize that their individual commitments to the integrity of requirements are what make the company soundSystemsA. The quality management function is dedicated to measuring conformance to requirements and reporting any differences accuratelyB. The quality education system (QES) ensures that all employees of the company have a common language of quality and understand their personal roles in causing quality to be routineC. The financial method of measuring nonconformance and conformance costs is used to evaluate processesD. The use of the company’s services or products by customers is measured and reported in a manner that causes corrective action to occurE. The companywide emphasis on defect prevention serves as a base for continual review and planning using current and past experience to keep the past from repeating itselfCommunicationsA. Information about the progress of quality improvement and achievement actions is continually supplied to all employeesB. Recognition programs applicable to all levels of responsibility are a part of normal operationsC. Each person in the company can, with very little effort, identify error, waste, opportunity, or any concern to top management quickly—and receive an immediate answerD. Each management status meeting begins with a factual and financial review of qualityOperationsA. Suppliers are educated and supported in order to ensure that they will deliver services and products that are dependable and on timeB. Procedures, products, and systems are qualified and proven prior to implementation and then continually examined and officially modified when the opportunity for improvement is seenC. Training is a routine activity for all tasks and is particularly integrated into new processes and proceduresPoliciesA. The policies on quality are clear and unambiguousB. The quality function reports on the same level as those functions that are being measured and has complete freedom of activityC. Advertising and all external communications must be completely in compliance with the requirements that the products and services must meet

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Achieving Quality (con’t)Deming’s Guidelines for Achieving Quality

1. Create and publish to all employees a statement of aims and purposes2. Learn new philosophy—this means top management and everybody else3. Understand purpose of inspection—for process improvement and cost reduction

4. End practice of awarding business on basis of price tag alone5. Improve constantly and forever system of production and service6. Institute training

7. Teach and institute leadership8. Drive out fear. Create trust. Create climate for innovation9. Optimize efforts of teams, groups, staff areas toward company aims and

purposes10. Eliminate exhortations to workforce

11. (a) Learn and institute methods for improvement (no numerical production quotas)

(b) learn capabilities of processes and how to improve them (no MBO)12. Remove barriers that rob people of pride of workmanship

13. Encourage education and self-improvement for everyone14. Take action to accomplish transformation

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Achieving Quality (con’t)

Juran’s Guidelines for Achieving Quality1. The mission of the firm as a whole to achieve

and maintain high quality

2. The mission of individual departments within the firmto achieve and maintain high quality

Shingo’s Guidelines for Achieving QualityPoka yoke

Feigenbaum’s Guidelines For Achieving QualityTotal quality management (TQM)

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Figure 22.2Poka yoke device

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QUALITY THROUGH STRATEGIC PLANNING

EnvironmentalAnalysis and Quality

Establishing OrganizationalDirection and Quality

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Strategy Formulation and QualitySWOT analysis

Improve and maintain high-quality operations and products:

Value adding

Leadership

Empowerment

Partnering1. Suppliers must prove themselves reliable and cost-effective

2. Suppliers must prove the sustained quality of their products

Gathering correct and timely information

Continuous improvement and innovation.



Strategy Implementation and Quality

Policies for Quality

Organizing for Quality ImprovementInfrastructure of quality council includes:

1. A process for nominating and selecting improvement projects2. A process for assigning project improvement teams3. A process for making improvements4. A variety of resources

5. A process for review of progress6. A process for dissemination of results and for recognition7. Appropriate employee merit rating system to reward quality improvement8. Extension of business planning to include goals for quality improvement

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Strategic Control and Quality

Crosby's successive stages of quality maturity:

1. Uncertainty

2. Awakening

3. Enlightenment

4. Wisdom

5. Certainty

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THE QUALITY IMPROVEMENT PROCESS

Figure 22.3The incremental approach to improving quality

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The Incremental Improvement Process

Step 1: Choose area of improvement (improvement “theme”)

Examples are:

Reduction in production cycle time

Increase in the percentage of nondefective units produced

Reduction in the variability of raw material going into production

Increase in on-time deliveries

Reduction in machine downtime

Reduction in employee absenteeism

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The Incremental Improvement Process (con’t)

Step 2: Organize quality improvement team

Members might include:

One or more associates directly responsible for the work being done

One or more customers receiving the benefits of the work

One or more suppliers providing input into the work

A member of management

Perhaps one or more experts in areas particularly relevant to solving the problem and making the improvement

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The Incremental Improvement Process (con’t)Step 3: “Benchmark” best performers

Step 4: Perform analysis to meet or beat benchmarkFactors to be analyzed:

Potential problems related to equipmentMaterialsWork methodsPeopleEnvironment:

Legal constraintsPhysical conditionsWeather

Step 5: Perform pilot study to test selected remedies

Step 6: Management implements improvements.



Reengineering ImprovementsHammer outlines principles of reengineering:

1: Organize around outcomes, not tasks

2: Have those who use the output of the process perform the process

3: Subsume information-processing work into the real work that produces the information

4: Treat geographically dispersed resources as though they were centralized

5: Link parallel activities instead of integrating their results

6: Put the decision point where the work is performed and build control into the process

7: Capture information once and at the source

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INNOVATION AND CREATIVITY

Creativity in IndividualsExpertise

Creative thinking

Motivation

Encouraging Creativity in Organization Members

1. Match individual expertise with work assignments

2. Provide resources necessary for creativity

3. Reward creativity

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INNOVATION AND CREATIVITY

Figure 22.4The three components of creativity

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Chapter Twenty-Two

Questions

© prentice hall, 2002 22 - 1 modern management 9 th edition

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