tqm 2nd assignment on nestle
TRANSCRIPT
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TOTAL QUALITY MANAGEMENT (890)
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
TOTAL QUALITY
MANAGEMENT (890)
TOTAL QUALITY
MANAGEMENT (890)
MBA
Semester – III (Spring, 2011)
MBA
Semester – III (Spring, 2011)
2nd ASSIGNMENT2nd ASSIGNMENT
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TOTAL QUALITY MANAGEMENT (890)
ACKNOWLEDGMENT
All praises to Almighty Allah, the one and only, the Merciful,
Beneficent and Compassionate, Billions of Darood-o-Salam upon
Muhammad (S.A.W), Last Prophet of Allah who is the savior of humanity.
Preparing an assignment like this is often the work of a number of
people whose names generally never appear on the cover. Yet
without their help and assistance, an assignment, like this would never
come to fruition. I’d like to recognize some special people who gave so
unselfishly to making this assignment. First of all, my parents and teacher
whose prayers and efforts make this a reality. I also want to thank the
persons from organizations who co-operate very well for assignment.
Thanks to all.
SAMLAN AHMAD KHAN
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
ABSTRACT
Quality is defined as Free of contamination and reproducibly delivers
the therapeutic benefit promised in the label to the consumer. Quality by
Design (QbD) is a concept first outlined by well-known quality expert Joseph
M. Juran in various publications, most notably Juran on Quality by Design.
Juran believed that quality could be planned, and that most quality crises
and problems relate to the way in which quality was planned in the first
place Quality by design rationally would be defined as quality should be
built into a product with a thorough understanding of the product and
process by which it is developed and manufactured along with a knowledge
of the risks involved in manufacturing the product and how best to mitigate
those risks.
A design rationale is the explicit listing of decisions made during a
design process, and the reasons why those decisions were made. Its
primary goal is to support designers by providing a means to record and
communicate the argumentation and reasoning behind the design process.
It should therefore include:
The reasons behind a design decision
The justification for it
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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The other alternatives considered
The tradeoffs evaluated, and
The argumentation that led to the decision
In this project I have focused on Nestles Pakistan how their designing
of canned Milo is fulfilling customer needs, how they are using different
techniques for marinating superior quality by design by using different tools
in techniques rationally in milk industry.
Nestle is the world largest food company and Nestle Milk Pak is
Nestlé’s famous UHT milk brand. Milo is added to hot or cold water and/or
milk to make a malted chocolate beverage. It does not dissolve readily in
cold milk, and so retains the gritty texture of its raw state. Milo can be
stirred into steamed milk to make a drink akin to hot chocolate or cocoa.
Another possible use is making a normal cup of cold Milo and microwaving
it for approximately 40–60 seconds. This gives the Milo drink a biscuit cover
on top. Is designed to fulfill customer expectations
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TABLE OF CONTENT
SR. NO. DESCRIPTION PAGE NO
1. Introduction to the Issue 6
2. Quality function deployment 7
3. Main Goals in Implementing QFD 8
4. Practical Study on Nestle 10
5. Nestle Introduction 11
6 Nestle Vision & Strategies 12
7. Implementations of QBD in Nestle 15
8. Data Collection Method 20
9. SWOT Analysis 21
10. Conclusion 23
11. Recommendation 24
12. References 25
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TOTAL QUALITY MANAGEMENT (890)
Introduction to the IssueDesign Process
The design process is the transformation of an idea, needs, or wants by
consumers or the marketplace at large, into a product that satisfies these
needs. This is usually accomplished by adventurous people that are willing
to take it on. Sometimes an engineer will be involved on some levels but
not always. Product designers follow various Methodology that requires a
specific skill set (usually in engineering) to complete.
Design is basically a problem solving exercise. The design of a new product
consists of the following stages:
1. Design Brief
2. Product Design Specifications
3. Concept Design
4. Testing
5. Detail Design
6. Manufacturing and Further Testing
7. Refinement and Sales
Design Space:
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The multidimensional combination and interaction of input variables
(e.g. Material attributes) and process parameters that have been
demonstrated to provide assurance of quality.
The focus of this concept is that quality should be built into a product
with a thorough understanding of the product and process by which it is
developed and manufactured along with a knowledge of the risks involved
in manufacturing the product and how best to mitigate those risks. This is a
successor to the "quality by QC" (or "quality after design") approach that
the companies have taken up until 1990s.
In business and engineering, new product development (NPD) is the
term used to describe the complete process of bringing a new product to
market. A product is a set of benefits offered for exchange and can be
tangible (that is, something physical you can touch) or intangible (like a
service, experience, or belief). There are two parallel paths involved in the
NPD process: one involves the idea generation, product design and detail
engineering; the other involves market research and marketing analysis.
Companies typically see new product development as the first stage in
generating and commercializing new products within the overall strategic
process of product life cycle management used to maintain or grow their
market share.
Quality function deployment (QFD):
Quality function deployment (QFD) is a “method to transform user
demands into design quality, to deploy the functions forming quality, and to
deploy methods for achieving the design quality into subsystems and
component parts, and ultimately to specific elements of the manufacturing
process.”
QFD is designed to help planners focus on characteristics of a new or
existing product or service from the viewpoints of market segments,
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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company, or technology-development needs. The technique yields graphs
and matrices.
Ultimately the goal of QFD is to translate often subjective quality
criteria into objective ones that can be quantified and measured and which
can then be used to design and manufacture the product. It is a
complimentary method for determining how and where priorities are to be
assigned in product development. The intent is to employ objective
procedures in increasing detail throughout the development of the product.
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The 3 main goals in implementing QFD are:
1. Prioritize spoken and unspoken customer wants and needs.
2. Translate these needs into technical characteristics and specifications.
3. Build and deliver a quality product or service by focusing everybody
toward customer satisfaction.
Since its introduction, Quality Function Deployment has helped to
transform the way of many Companies:
• Plan new products
• Design product requirements
• Determine process characteristics
• Control the manufacturing process
• Document already existing product specifications
QFD uses some principles from Concurrent Engineering in that cross-
functional teams are involved in all phases of product development. Each of
the four phases in a QFD process uses a Matrix to translate customer
requirements from initial planning stages through production control.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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Practical Study On Nestle
Milo
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Nestle Introduction
Nestle began in Switzerland in the mid 1860s when founder Henri
Nestle created one of the first baby formulas. Nestlé’s first product was
called Farine Lacteal (“corn flour gruel” in French) Henri Nestle. The
product was first used on a premature baby who could not tolerate his
mother’s milk or other alternative products of that time. Doctors gave up
on treating the infant. Miraculously the baby tolerated Henri’s new formula
and it provided the nourishment that saved his life. Within a few years the
first Nestle product was marketed in Europe
In 1980s Nestle had a new Chief Executive Officer. The company
focused on improving its financial situation and continuing to expand. In
one of the largest takeovers at that time, Nestle bought Carnation for $3
billion and parted with any unprofitable businesses.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Nestle is the largest food and beverage company in the world, marketing
more than 9000 brands in 85 countries with a global workforce of
250,000. Nestle is a human company and offers tremendous opportunities
for career growth and learning at domestic and international levels. The
leading in the food industry, Nestle brings in $81 billion in overall sales
and has 470 factories around the world. Nestle will continue to grow,
introduce new products and renovate existing ones.
The company’s mission is to focus on long-term potential over short-term
performance.
Nestle Vision and Strategies
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The Nestlé global vision is to be the leading health, wellness, and
Nutrition Company in the world. Nestlé Pakistan subscribes fully to this
vision. In particular, they envision to:
Lead a dynamic motivated and professional workforce – proud of its
heritage and bullish about the future.
Meet the nutritional needs of consumers of all age groups – from
infancy to old age, from nutrition to pleasure, through an innovative
portfolio of branded food and beverage products of the highest quality.
Deliver shareholder value through profitable long-term growth, while
continuing to play a significant and responsible role in the social,
economic and environmental sectors of the country.
Nestle have profitable and diversified high quality food and beverage
product portfolio, delivering 60:40+ advantage to consumers, available
across all sales channels.
Nestle brands are the preferred choice in their categories. Consumer
insight drives all aspects of our marketing and communication efforts.
Their communications to the consumer are relevant, cutting-edge, and
adhere to the highest standards of responsible communication.
Nestle is seen as the No. 1 career destination for talented, motivated
and ambitious professionals.
Their result-oriented organizational structure ensures effective
communication and empowered self-management.
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Their milk collection and agriculture services will continue to play the
primary role in development of the dairy sector in rural Pakistan.
Their proactive innovation and renovation culture is the key to our
success in the marketplace.
Fully integrated systems (Nestle Pakistan, suppliers, customers) ensure
efficient business processes.
Non-strategic activities and products are outsourced or discontinued.
Nestle MiloMilo is supposedly high in energy, because the drink has 1,760 kJ in
every 100 g of the drink. It is also for this reason, marketed as the "Energy
Food Drink". It is also supposed to have a low Glycemic Index (GI), that is,
"33 made with whole milk, 36 made with reduced fat milk". This allows the
energy in Milo to be released slowly.
The Milo website states that the drink is high in calcium, iron and the
vitamins B1, B2, B6, B12. It also has Actigen-E that releases the energy stored
in a person's body.
The contents of the above said products have the following fruitful
benefits for health improvement of Human body.
Calcium
It is important for the growth of strong bones and teeth.
Protein
It is necessary for cell and tissue growth.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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Phosphorous
It is important for healthy bones and teeth.
Vitamin A
It improves vision and keeps skin and hair healthy
Competitors of Nestle Pakistan:Competitors of Nestle Pakistan milk industry are:
1. Haleeb
2. Engro chemicals
Total Target Market for Nestle Pakistan for Chocolate Milk
Total Target Market Of Milk (liters) 180,000,000
Annual Production Of Milk (Billion Liters) 33.25
Total market of Gawala (96%) Billion liters 31.92
Total EXISTING market of processed
milk (4%) Billion Liters1.33
Implementations of Quality by Design in Nestle Phase# 1 Product Planning:
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
In Nestle Pakistan phase 1 which is the Building the House of Quality. Led by
the marketing department, Phase 1, or product planning, is also called The
House of Quality. Many organizations only get through this phase of a QFD
process. Phase 1 documents customer requirements, warranty data,
competitive opportunities, product measurements, competing product
measures, and the technical ability of the organization to meet each customer
requirement.
Phase #2 Product Design:In Nestles Pakistan phase 2 is led by the engineering department. Product
design requires creativity and innovative team ideas. Product concepts are
created during this phase and part specifications are documented. Parts
that are determined to be most important to meeting customer needs are
then deployed into process planning, or Phase 3.
Phase #3 Process Planning: Process planning comes next and is led by manufacturing engineering.
During process planning, manufacturing processes are flowcharted and
process parameters (or target values) are documented.
Phase#4 Process Control:And finally, in production planning, performance indicators are created to
monitor the production process, maintenance schedules, and skills training
for operators. Also, in this phase decisions are made as to which process
poses the most risk and controls are put in place to prevent failures. The
quality assurance department in concert with manufacturing leads
Steps to the House of QualityStep 1: Customer Requirements - "Voice of the Customer"
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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The first step in a QFD project is to determine what market segments will
be analyzed during the process and to identify who the customers are. The
team then gathers information from customers on the requirements they
have for the product or service. In order to organize and evaluate this data,
the team uses simple quality tools like Affinity Diagrams or Tree Diagrams.
Step 2: Regulatory RequirementsNot all product or service requirements are known to the customer, so the
team must Document requirements that are dictated by management or
regulatory standards that the Product must adhere to.
Step 3: Customer Importance RatingsOn a scale from 1 - 5, customers then rate the importance of each
requirement. This number will be used later in the relationship matrix.
Step 4: Customer Rating of the CompetitionUnderstanding how customers rate the competition can be a tremendous
competitive advantage. In this step of the QFD process, it is also a good
idea to ask customers how your product or service rates in relation to the
competition. There is remodeling that can take place in this part of the
House of Quality. Additional rooms that identify sales opportunities, goals
for continuous improvement, customer complaints, etc., can be added.
Step 5: Technical Descriptors - "Voice of the Engineer"The technical descriptors are attributes about the product or service that
can be measured and benchmarked against the competition. Technical
descriptors may exist that your organization is already using to determine
product specification, however new measurements can be created to
ensure that your product is meeting customer needs.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Step 6: Direction of ImprovementAs the team defines the technical descriptors, a determination must be
made as to the Direction of movement for each descriptor.
Step 7: Relationship MatrixThe relationship matrix is where the team determines the relationship
between customer Needs and the company's ability to meet those needs.
Relationships can either be weak, moderate, or strong or carry a numeric
value of 1, 3 or 9 used by nestle Pakistan.
Step 8: Organizational DifficultyRate the design attributes in terms of organizational difficulty. It is very
possible that some attributes are in direct conflict. Increasing the number
of sizes may be in conflict with the companies stock holding policies, for
example.
Step 9: Technical Analysis of Competitor ProductsTo better understand the competition, engineers then conducts a
comparison of Competitor technical descriptors. This process involves
reverse engineering competitor Products to determine specific values for
competitor technical descriptors.
Step 10: Target Values for Technical DescriptorsAt this stage in the process, the QFD team begins to establish target values
for each technical descriptor. Target values represent "how much" for the
technical descriptors, and can then act as a base-line to compare against.
Step 11: Correlation MatrixThis room in the matrix is where the term House of Quality comes from
because it makes the matrix look like a house with a roof. The correlation
matrix is probably the least used room in the House of Quality; however,
this room is a big help to the design engineers in the next phase of a
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
comprehensive QFD project. Team members must examine how each of
the technical descriptors impacts each other. The team should document
strong negative relationships between technical descriptors and work to
eliminate physical contradictions.
Step 12: Absolute ImportanceFinally, the team calculates the absolute importance for each technical
descriptor. This Numerical calculation is the product of the cell value and
the customer importance rating. Numbers are then added up in their
respective columns to determine the importance for each technical
descriptor. Now you know which technical aspects of your product matters
the most to your customer
QFD is a systematic mean of ensuring that customer requirements are
accurately translated into relevant technical descriptors throughout each
stage of product development. Therefore, meeting or exceeding customer
demands means more than just maintaining or improving product
performance. It means designing and manufacturing products that delight
customers and fulfill their unarticulated desires. Companies growing into
the 21st century will be enterprises that foster the needed innovation to
create new markets.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Data Collection Method
I did this quantitative research by conducted different interviews from
the quality assurance manager of nestle Pakistan and also from the
employees and engineers of nestle Pakistan.
We took many interviews from quality assurance department to get
the overall situation prevailing in nestle.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
SWOT AnalysisStrengths:
Strong Brand image:
Nestle has been serving the Pakistani consumers since 1988, and it
has built a strong brand image due to its quality products.
Quality product:
Solid Financial position:
Annual turnover is Rs.30 Billion which provides it a financial edge
over its competitors.
Strong supply chain network:
Nestle collects Milk directly form the farmers instead of relying on the
contractors. And it distribution is also very strong. In this way it has a
complete control over its supply chain.
Qualified work force
Commitment to High Quality Products
Focus on research and development
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Weaknesses:The target market of Nestle Milo’s upper middle and high class
because lower middle and poor class cannot afford to buy chocolate milk
due to its premium price.
Opportunities: More people are coming towards processed milk because loose milk
is dangerous for health due to a lot of contamination.
Growth of processed milk is increasing with 20% annually so Nestle
Milo has the opportunity to capture a large share of market.
Threats: Two main competitors Haleeb and Olpers are main threat for Milo
especially the Olpers is growing very fast.
Inflation is getting higher and higher so the purchasing power of the
people is decreasing day by day.
There is no entry barrier for new entrants as the Olpers has come in
the market.
Very low quality milk is provided by the milkmen to dairy farms which
is a very big threat for the entire market.
The shortage of milk providing animals is also a threat for entire milk
industry.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Conclusion
Nestle is the world largest food company. Milo Energy Drink has been
made into a chocolate flavor, called the "Milo” that is manufactured by
Nestle and sold worldwide. Milo has been available for many years in a
malted flavor, marketed in a burgundy can alongside the traditional green
tin. Products based on Milo are available, such as cereal, yoghurt and ice
cream. In addition to the powdered form, there is a pre-mixed version of
Milo that comes in cans or drink boxes.
Nestle is using quality by design technique to get maximum consumer
satisfaction and through rationale ways its implement very profitable and
innovative techniques to get the maximum result from its consumer
benefited products.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
Recommendations
Nestle is one of the top companies of the world for the current issue I
give following recommendations to the nestle Pakistan:
It have to make changes in marketing department techniques that is
the Phase 1 of the quality be design method by widening up its target
market, targeting more segments available in the market.
It have to bring new innovative ideas in engineering department by
designing Milo in different other ways due to competitors continuous
changes.
It have to also look ate the quality perspective because one of the
downfall of tetra pack Milo was that in summers the milk became very
unhealthy according to different researches conducted.
Presented By: SALMAN AHMAD KHAN Roll No: W-588058
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TOTAL QUALITY MANAGEMENT (890)
References
1. Through Websides:
http://www.independent.co.uk/environment/green-living/online-
protest-drives-nestl-to-environmentally-friendly-palm-oil-
1976443.html.
2. Sales manager Nestle Pakistan, Islamabad Mr. Naveed Qamar, I/8
industrial Area Islamabad.
http://www.authorstream.com/Presentation/robin_vinnu-623276-pharmaceutical-quality-by-design-
qbd/
Presented By: SALMAN AHMAD KHAN Roll No: W-588058