Total Quality Management

Total Quality Management

Barhate Mangesh

Roll No- PG/509/MBA (I)/2009J

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TOTAL QUALITY MANAGEMENTTOTAL QUALITY MANAGEMENTTOTAL QUALITY MANAGEMENTTOTAL QUALITY MANAGEMENT

Name of Student Mr. Barhate Mangesh Tukaram

Roll No PG/509/MBA(I)/2009J

Institute Silver Bright Institute of Management (SBIM), Pune

Subject Total Quality Management

Date 10 Jan 2010


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INDEX

- Preamble

- Total Quality Management

- A QUALITY ORIENTED APPROACH

- Concepts and Philosophies of TQM

- Deming’s Fourteen Points

- Ten Steps to Total Quality Management

- Plan and organize for quality improvement

- TQM Problem Solving Sequence

- The TQM Model

- The Acceptability of TQM

- TQM in Service Industry

- The Essentials of TQM

- The Effects of TQM

- TQM Tools

- Wrapping Up


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Preamble

“Every nation has its own independent historical and cultural background. The quality

scenario, therefore, differs from one national setting to the other. The nations are

orienting their quality management strategies and systems to meet the requirements of

the operating environment though the primary focus remains the same, that is, Total

Customer Satisfaction .Many of the present techniques of quality management were

developed in Japan. However, U.S.A., European nations and developing nations have

also contributed significantly to this development. The studies carried out by

researchers in different national settings reveal that the concept and philosophies of

TQM are not understood by the managers and others. An all out effort, therefore is

required to promote the understanding by launching massive educational and

management development programs at all levels so as to create a cultural

consciousness towards quality. TQM is not undimensional approach but is multifaceted

in nature. Understanding these facets is essential to promote a successful quality

improvement program. An integrated approach on all vital components of TQM is

required to achieve the desired goal.”


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As defined by ISO:

"TQM is a management approach of an organization, centered on quality, based on the

participation of all its members and aiming at long-term success through customer satisfaction,

and benefits to all members of the organization and to society."

In Japanese, TQM comprises four process steps, namely:

1. Kaizen – Focuses on Continuous Process Improvement, to make processes visible, repeatable

and measureable.

2. Atarimae Hinshitsu – Focuses on intangible effects on processes and ways to optimize and

reduce their effects.

3. Kansei – Examining the way the user applies the product leads to improvement in the

product itself.

4. Miryokuteki Hinshitsu – Broadens management concern beyond the immediate product.

TQM requires that the company maintain this quality standard in all aspects of its business. This

requires ensuring that things are done right the first time and that defects and waste are

eliminated from operations.

Total Quality Management (TQM) is a management strategy aimed at embedding awareness of

quality in all organizational processes. TQM has been widely used in manufacturing, education,

government, and service industries, as well as NASA space and science programs.

“A QUALITY ORIENTED APPROACH”

Total Quality Management (TQM) is one of quality-oriented approaches that many organisations

adopt. It is generally acknowledged that manufacturing companies need to be quality oriented in

conducting their business to survive the business world. TQM is an integrated management

philosophy and a set of practices that emphasise top management commitment, customer focus,

supplier relationship, benchmarking, quality-oriented training, employee focus, zero-defects,

process improvement, and quality measurement. This paper investigates the structural linkages

between TQM, product quality performance and business performance in the electronics industry

in Malaysia. Given the nature of this study, the statistical analysis technique called Structural

Equation Modelling was used. This preliminary result suggests that there is insufficient statistical


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evidence to conclude significant simple relationships between TQM, product quality

performance, and business performance. This implies that the electronics industry cannot assume

direct causal linkages between these three constructs, which might also suggest that there is a

more complex relationship between TQM, product quality performance, and business

performance. However, the results reveal that top management commitment, supplier relations

and training in particular appear to be of primary importance for TQM practices in Malaysian

electronics companies.

Characteristics of TQM:

The characteristics of TQM, as revealed from above definition are as follows:

1. TQM is customer oriented.

2. TQM requires a long term commitment for continuous improvement of all processes.

3. The success of TQM demands the leadership of top management and continuous

involvement.

4. Responsibility for establishments and improvement of systems lies with the management

of an organisation.

5. TQM is a strategy for continuously improving performance at all levels and in all areas of

responsibility.

Potential Benefits of TQM:

The advantages of adopting TQM system compared to conventional quality system are numerous

and are outlined below.

1. TQM helps to focus clearly on the needs of the market.

The traditional approach of quality control focuses on the technical details of a product so as

to satisfy the customer. However, the customer longs for different satisfaction perspectives

which are generally overlooked in the traditional approach. The needs change from person to

person and also from place to place. As TQM focuses on the concept of university, it tries to

abstract the satisfaction perceptions of the market and thus helps the organization to identify and

meet the requirements of the market in a better way.

2. TQM facilitates to aspire for a top quality performer in every sphere of activity.

It is a well accepted fact that the negative attitudes of employees and non-participative culture

of the organization pose the greatest hurdle to organization’s success, growth and prosperity.

TQM emphasis, on bringing about attitudinal and cultural change through promotion of

participative work culture and effective team-work. This serves to satisfy the higher human


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needs of recognition and self-development and enhances employee’s interest in the job. The

employee’s performance, thus, is not restricted to the product or service areas but reflects in

other spheres as well.

3. It channelizes the procedures necessary to achieve quality performance.

Quality in its true sense cannot be achieved instantly. It requires a systematic and a long-term

planning and strategic approach. By focusing on defining the quality policies, goals and

objectives, and communicating these properly to one and all in the organization, adopting SQC

and SPC techniques and developing and using a system of evaluation , the organization can

channelize their efforts to achieve the desired and objectivated quality performance.

4. It helps examine critically and continuously all processes to remove non-productive

activities and waste.

The organizations always aim at improving productivity as it leads to reduction in cost resulting

in increase in profitability. The efforts in this direction are contributed because of the formation

of quality improvement teams which meet regularly and through a systematic approach which

tries to remove non-productive activity. A continuous effort to identify the problems and resolve

them helps to reduce the waste. The culture of well being thus improves housekeeping, cost-

effectiveness and safety.

5. It gears organizations to fully understand the competition and develop an effective combating

strategy.

The dynamic changes in the global market and the open market policies adopted by a large

number of organizations has resulted in increased competition and for many organizations the

survival has become a key issue. For this cause it is essential for the organistions to understand

the competition and develop and adopt suitable strategies to meet the challenges. As TQM helps

to understand the pulse of customer and thus the market, it gives an edge to the organizations of

variable nature to meet the competition.

6. It helps to develop good procedures for communication and acknowledging good work.

Improper procedures and inadequate communication are yet another bane of many

organizations, which result in misunderstanding, confusion, low productivity, duplication of

efforts, poor quality, low morale and so on. TQM brings together members of various related

sections, departments and different levels of management thereby providing an effective vehicle

of communication and interaction.

7. It helps to review the process needed to develop the strategy of never ending improvement.

Quality improvement efforts cannot be restricted to any time period. They need to be continuous

to meet the dynamic challenges. TQM emphasizes on a continuous and periodic review so as to

make the required changes.


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Concepts and Philosophies of TQM

Total Quality Management (TQM), a buzzword phrase of the 1980's, has been killed and

resurrected on a number of occasions. The concept and principles, though simple seem to be

creeping back into existence by "bits and pieces" through the evolution of the ISO9001

Management Quality System standard.

Companies who have implemented TQM include Ford Motor Company, Phillips Semiconductor,

SGL Carbon, Motorola and Toyota Motor Company.

The latest changes coming up for the ISO 9001:2000 standard’s "Process Model" seem to

complete the embodiment. TQM is the concept that quality can be managed and that it is a

process. The following information is provided to give an understanding of the key elements of

this process.

TOTAL QUALITY MANAGEMENT(TQM) : Total = Quality involves everyone and all activities in the company.

Quality = Conformance to Requirements (Meeting Customer Requirements).

Management = Quality can and must be managed.

TQM = A process for managing quality; it must be a continuous way of life; a philosophy of

perpetual improvement in everything we do.

TQM Compared to ISO 9001 :

ISO 9000 is a Quality System Management Standard. TQM is a philosophy of perpetual

improvement. The ISO Quality Standard sets in place a system to deploy policy and verifiable

objectives. An ISO implementation is a basis for a Total Quality Management implementation.

Where there is an ISO system, about 75 percent of the steps are in place for TQM. The

requirements for TQM can be considered ISO plus. Another aspect relating to the ISO Standard

is that the proposed changes for the next revision (1999) will contain customer satisfaction and

measurement requirements. In short, implementing TQM is being proactive concerning quality

rather than reactive.

TQM as a Foundation:

TQM is the foundation for activities which include;

1. Meeting Customer Requirements

2. Reducing Development Cycle Times

3. Just In Time/Demand Flow Manufacturing

4. Improvement Teams

5. Reducing Product and Service Costs

6. Improving Administrative Systems Training


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Deming’s Fourteen Points

Presented below are Deming’s fourteen points for total quality management.

The Deming Theory

The Deming Theory of Management is a management philosophy based on four principles: (1)

an appreciation for systems, (2) a knowledge of variation, (3) a theory of knowledge, and (4)

psychology. Although the principles for continuous improvement are clearly profitable for

companies to implement, why has it been difficult to transform the culture of western

management to focus on quality? Deming compiled a list of seven deadly diseases that have

inhibited change in style of management. Although Deming’s Encyclopedia Britannica

videotape only highlights five, the entire list is presented in figure


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Ten Steps to Total Quality Management (TQM)

The Ten Steps to TQM are as follows:

1. Pursue New Strategic Thinking

2. Know your Customers

3. Set True Customer Requirements

4. Concentrate on Prevention, Not Correction

5. Reduce Chronic Waste

6. Pursue a Continuous Improvement Strategy

7. Use Structured Methodology for Process Improvement

8. Reduce Variation

9. Use a Balanced Approach

10. Apply to All Functions

Principles of TQM :

The Principles of TQM are as follows:

1. Quality can and must be managed.

2. Everyone has a customer and is a supplier.

3. Processes, not people are the problem.

4. Every employee is responsible for quality.

5. Problems must be prevented, not just fixed.

6. Quality must be measured.

7. Quality improvements must be continuous.

8. The quality standard is defect free.

9. Goals are based on requirements, not negotiated.

10. Life cycle costs, not front end costs.

11. Management must be involved and lead.


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Plan and organize for quality improvement

Processes must be Managed and Improved:

Processes must be managed and improved! This involves:

1. Defining the process

2. Measuring process performance (metrics)

3. Reviewing process performance

4. Identifying process shortcomings

5. Analyzing process problems

6. Making a process change

7. Measuring the effects of the process change

8. Communicating both ways between supervisor and user

Key to Quality:

1. The key to improving quality is to improve processes that define, produce and support

our products.

All people work in processes.

2. People

3. Get processes "in control"

4. Work with other employees and managers to identify process problems and eliminate

them

5. Managers and/or Supervisors Work on Processes

6. Provide training and tool resources

7. Measure and review process performance (metrics)

8. Improve process performance with the help of those who use the process


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Planning a Change

To be successful implementing TQM, an organization must concentrate on the eight key

elements:

1. Ethics

2. Integrity

3. Trust

4. Training

5. Teamwork

6. Leadership

7. Recognition

8. Communication


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TQM Problem Solving Sequence

TQM Process Improvement and Problem Solving Sequence

PLAN

(PLAN A CHANGE)

DO

(IMPLEMENT

THE CHANGE)

CHECK

(OBSERVE

THE EFFECTS)

ACTION

(EMBED THE FIX INTO

THE PROCESS

FOR GOOD)

DEFINE THE

PROBLEM

IDENTIFY POSSIBLE

CAUSES

EVALUATE POSSIBLE

CAUSES

MAKE A

CHANGE

TEST THE

CHANGE

TAKE PERMANENT

ACTION

1. Recognize that

what you are doing is a

"PROCESS"

2. Identify the

commodity

being processed.

- Process

Inference

3. Define some

measurable

characteristics of value to

the

commodity.

4. Describe

the "PROCESS"

o Process Flow

Analysis's

o Flow charts o List of steps

5. Identify the

"Big" problem

o

Brainstorming o Checklists

6.

"BRAINSTORM"

what is causing

the problem.

7. Determine

what past

data shows. o Frequency

distribution

o Pareto charts

o Control charts

- sampling

8. Determine the

relationship

between cause and

effect

o Scatter diagrams

o Regression analysis

9. Determine what

the process is doing

now

o Control charts - sampling

10. Determine

what change

would help

Your

knowledge

of the process

Scatter

diagrams

Control Charts

- sampling

Pareto analysis

****Then

make

the change.

11. Determine

what change

worked

(confirmation).

Histograms

Control charts

- sampling

Scatter

diagrams

12. Ensure the fix is

embedded in the

process and that the

resulting process is

used.

Continue to monitor

the process to

ensure:

A. The problem is

fixed for good.

and

B. The process

is good enough o Control charts

- sampling

****To ensure continuous

improvement, return

to step 5.


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o Pareto analysis

The TQM Model

At the century close, the creation of the global market, international orientation of management

that sweeps national boundaries, introduction of new technologies, and shift towards customer

focused strategies, make the competition stronger than ever. The criteria for success in this

global, internationally oriented market have been changing rapidly. In order to expand business,

enter new markets, and set realistic, competitive long-term objectives, excellence became an

imperative. Management's effort has been directed towards discovering what makes a company

excellent.

To achieve excellence, companies must develop a corporate culture of treating people as their

most important asset and provide a consistent level of high quality products and services in every

market in which they operate. Such an environment has supported the wide acceptance of Total

Quality Management (TQM) which emerged recently as a new, challenging, marketable

philosophy. It involves three spheres of changes in an organization -- people, technology and

structure.

There is also a need for a systematic approach so that each element of TQMEX can be bonded

together smoothly. Oakland [1989] originated the idea of a 3-cornerstone model. The proposed

4-pillar model (Figure 3.1) brings the customer's requirement into the system. This makes the

approach to TQM more complete. The additional pillar -- satisfying customers -- is vital because

it explicitly addresses customers requirements. Without it TQM would have no objective.

The Four Pillars of TQM

The role of top management in implementation of total quality is crucial and its input on people

far-reaching. TQM, therefore, should be understood as management of the system through

systems thinking, which means understanding all the elements in the company and putting them

to work together towards the common goal. The TQMEX Model advocates an integrated

approach in order to support the transition to systems management which is an ongoing process

of continuous improvement that begins when the company commits itself to managing by


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quality. The Model illuminates the elements that form a base to the understanding of TQM

philosophy and implementation of the process company-wide.

The Acceptability of TQM

Japanese TQM Model

At first, few but the Japanese took Deming seriously. Known for his legendary attacks on

executives and compassion for the worker, the Japanese sense of responsibility to one's superiors

and subordinates made it easier to accept Deming's message that management's role was to

provide the optimal conditions for the workers to do the best job.

The Japanese then extended Deming's teaching to many dimensions of management. Here are

TQM models from the Japanese Society of Quality and the Japan Standards Association that

show how extensive their definition of TQM is.

The Japanese identify three major dimensions of TQM: Daily Management, Hoshin/Policy

Management, and Cross Function Management. We will study these in detail in the course.

They can be visualized with the following picture.

TQM in UAS:

As regards quality, USA is at crossroads today.Inspite of the fact that USA developed the

techniques and concepts of SQC and TQC and the japenese imported these techniques, the


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further orientation and development in philoshophy, concept and techniques in terms of Q.C.

circles and company wide quality control took place in Japan more rapidly and successfully.

While the American companies remained concerned about detecting and segregating defective

parts from good ones, the Japanese companies devised systems to reduce defects and produce

good quality products.This resulted in America losing its position of dominance not only in the

American market but also in the world.

Much of the quality movement in USA is based on tools and techniques developed by the

japenese. Adoption of these techniques requires complete re-development in both methods and

emphasis.The most critical challenge facing U.S quality movement is the development and

implementation of quality focused corporate management systems that achieve the coherence,

integration and comprehensiveness of quality management in japan. The American companies

are characterized by:

1. A high concentration of industry on relatively few companies.

2. Stress on promoting share-holders, and

3. Running the company by professional managers.

These features of autonomous organisations and professional management have a considerable

impact on the conduct of quality function. Each organisation determines independently what it

will produce and what quality policies it will adopt.

Marguardt divides the evolution of quality movement in USA in three periods:

1. Advocates for SQC- Emphasis on technical tools of control charts, lot inspection and

sampling schemes.

2. Administrators for system of quality control- Emphasis on the cost of quality and managerial

aspects of organizing the quality.

3. Advertising and selling quality consciousness-Emphasis on changing organizational culture

and providing an environment that will enable people to activate and sustain in their own work

and in products and services produced by the organistions with the focus on needs of customers.

TQM in Service Industry


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TQM in Service Industry

Introduction

Today’s customer has before him the possibility of a wider choice of products & Services than

ever before .He is going to be demanding & keen on having the best services in the shortest

possible time & at the minimum cost .He will look for solutions that are more specific to his

needs thus creating opportunity of many niche market.

-Today customers avail ATM services 24 hrs

-Book airline tickets & check-in over phone

-Self-service at fast food restaurant.

-And many more

What is different ?

-Service is also a product of different kind .

-No time delay between the production & delivery of service

-A defective product can be replaced but a defective service may create a permanent damage.

Growth of Service sector

Service sector is growing rapidly due to

-Change in environment , life style etc

-Demand for new kind of services

-Advent of new technologies

-Fast development of information technology & computerisation

-Lean manufacturing . (contracting out most activities)

Challenge of Service sector

Delight customers

-In a dynamic environment which is changing fast

-In growing competitive market

-With relatively shorter product life cycle

-Requiring more customisation

Service Quality Dimensions

Quality of Services differs from manufactured products

-Special characteristics including intangibility.

-Simultaneity ( promptness )


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-Heterogeneity

-Unique dimensions of some services (e.g. Banking)

The Essentials of TQM

TQM is the way of managing for the future, and is far wider in its application than just assuring

product or service quality – it is a way of managing people and business processes to ensure

complete customer satisfaction at every stage, internally and externally. TQM, combined with

effective leadership, results in an organization doing the right things right, first time.

The core of TQM is the customer-supplier interfaces, both externally and internally, and at each

interface lie a number of processes. This core must be surrounded by commitment to quality,

communication of the quality message, and recognition of the need to change the culture of the

organisation to create total quality. These are the foundations of TQM, and they are supported by

the key management functions of people, processes and systems in the organisation. This section

discusses each of these elements that, together, can make a total quality organisation. Other

sections explain people, processes and systems in greater detail, all having the essential themes

of commitment, culture and communication running through them.


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The Effects of TQM

Improving Financial Services through TQM

The work described in this case study was undertaken in a young, rapidly expanding company in

the financial services sector with no previous experience with Total Quality Management

(TQM). The quality project began with a two-day introductory awareness program covering

concepts, cases, implementation strategies and imperatives of TQM. The program was conducted

for the senior management team of the company. This program used interactive exercises and

real life case studies to explain the concepts of TQM and to interest them in committing

resources for a demonstration project. The demonstration project, which used the Seven Steps of

Problem Solving (similar to DMAIC), was to show them how TQM concepts worked in practice

before they committed resources for a company-wide program.

Step 1. Define the Problem

1.1) Selecting the theme: A meeting of the senior management of the company was held.

Brainstorming produced a list of more than 20 problems. The list was prioritized using the

weighted average table, followed by a structured discussion to arrive at a consensus on the two

most important themes -- customer service and sales productivity.

Under the customer service theme, "Reducing the Turnaround Time from an Insurance Proposal

to Policy" was selected as the most obvious and urgent problem. The company was young, and

therefore had few claims to process so far. The proposal-to-policy process therefore impacted the

greatest number of customers.

An appropriate cross functional group was set up to tackle this problem.

1.2) Problem = customer desire – current status:

Current status: What did the individual group members think the turnaround is currently? As

each member began thinking questions came up. "What type of policies do we address?" Medical

policies or non-medical? The latter are take longer because of the medical examination of the

client required. "Between what stages do we consider turnaround?" Perceptions varied, with each

person thinking about the turnaround within their department. The key process stages were

mapped:


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Several sales branches in different parts of the country sent proposals into the Central Processing

Center. After considerable debate it was agreed at first to consider turnaround between entry into

the computer system at the Company Sales Branch and dispatch to the customer from the Central

Processing Center (CPC). Later the entire cycle could be included. The perception of the length

of turnaround by different members of the team was recorded. It averaged:

Non-Medical Policies 17 days

Medical Policies 35 days

Invoking the slogan from the awareness program "In God we trust, the rest of us bring data" the

group was asked to collect data and establish reality. Armed with a suitably designed check sheet

they set about the task.

Customer desire: What was the turnaround desired by the customer? Since a customer survey

was not available, individual group members were asked to think as customers -- imagine they

had just given a completed proposal form to a sales agent. When would they expect the policy in

hand? From the customer's point of view they realized that they did not differentiate between

medical and non-medical policies. Their perception averaged out six days for the required

turnaround.

"Is this the average time or maximum time that you expect?" they were asked. "Maximum," they

responded. It was clear therefore that the average must be less than six days. The importance of

"variability" had struck home. The concept of sigma was explained and was rapidly internalized.

For 99.7 percent delivery within the customer limit the metric was defined.

Customer desire:

Average+3 Sigma turnaround = less than 6 days

Current status:

Non-medical policies (Average 19/Sigma 15) Average+3 sigma= 64 days

Medical (Average 37/Sigma 27) Average+3 sigma= 118 days


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The Problem was therefore defined:

Reduce Average+3 sigma of turnaround for:

Non-Medical Policies From 64 to 6 days

Medical Policies From 118 to 6 days

The performance requirement appeared daunting. Therefore the initial target taken in the Mission

Sheet (project charter) was to reduce the turnaround by 50 percent -- to 32 and 59 days

respectively.

Step 2. Analysis of the Problem

In a session the factors causing large turnaround times from the principles of JIT were explained.

These were:Input arrival patterns

• Waiting times in process

- Batching of work

- Imbalanced processing line

- Too many handovers

- Non-value added activities, etc.

• Processing times

• Scheduling

• Transport times

• Deployment of manpower

Typically it was found that waiting times constitute the bulk of processing turnaround times.

Process Mapping (Value Stream Mapping in Lean) was undertaken. The aggregate results are

summarized below:

Number of operations 84

Number of handovers 13

In-house processing time (estimated) 126 man-mins.

Range of individual stage time 2 to 13 mins.

Could this be true? Could the turnaround be 126 minutes for internal processing without waiting?

The group started to question of the status quo. The change process had begun. To check this

estimate it was decided to collect data -- run two policies without waiting and record the time at

each stage. The trial results amazed everyone: Policy No. 1 took 100 minutes and Policy No. 2

took 97 minutes. Almost instantly the mindset changed from doubt to desire: "Why can't we

process every proposal in this way?"

Step 3. Generating Ideas

In the introductory program of TQM during the JIT session the advantages of flow versus batch

processing had been dramatically demonstrated using a simple exercise. Using that background a

balanced flow line was designed as follows:


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1. Determine the station with the maximum time cycle which cannot be split up by reallocation --

8 minutes.

2. Balance the line to make the time taken at each stage equal 8 minutes as far as possible.

3. Reduce the stages and handovers -- 13 to 8.

4. Eliminate non-value added activities -- transport -- make personnel sit next to each other.

5. Agree processing to be done in batch of one proposal.

Changing the mindset of the employees so they will accept and welcome change is critical to

building a self-sustaining culture of improvement. In this case, the line personnel were involved

in a Quality Mindset Program so that they understood the reasons for change and the concepts

behind them and are keen to experiment with new methods of working. The line was ready for a

test run.

Step 4. Testing the Idea

Testing in stages is a critical stage. It allows modification of ideas based upon practical

experience and equally importantly ensures acceptance of the new methods gradually by the

operating personnel.

Stage 1: Run five proposals flowing through the system and confirm results. The test produced

the following results:

Average turnaround time: < 1 day

In-house processing time: 76 mins.

There was jubilation in the team. The productivity had increased by 24 percent. The head of the

CPC summarized: "I gave five files for processing, and went for a meeting. Emerging from the

meeting about 30 minutes later I was greeted by the dispatch clerk jubilantly reporting, "'Madam,

the TQM files are ready for dispatch.'" The mindset was dramatically changed and line personnel

were now keen to push the implementation.

Stage 2: It was agreed to run the new system for five days -- and compute the average and sigma

of the turnaround to measure the improvement. It was agreed that only in-house processing was

covered at this stage and that the test would involve all policies at the CPC but only one branch

as a model. This model, once proved, could be replicated at other branches.

The test results showed a significant reduction in turnaround:

1. For all non-medical policies From 64 to 42 days or 34%

2. For policies of the model branch From 64 to 27 days of 60%

The Mission Sheet goal of 50 percent reduction had been bettered for the combined model

branch and CPC. Further analysis of the data revealed other measures which could reduce the

turnaround further. Overall reduction reached an amazing 75 percent. Turnaround, which had

been pegged at 64 days, was now happening at 99.7 percent on-time delivery in 15 days.


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Step 5. Implementing the Ideas

Regular operations with the new system was planned to commence. However, two weeks later it

was still not implemented. One of the personnel on the line in CPC had been released by his

department for the five-day trial to sit on the line but was not released on a regular basis. The

departmental head had not attended the TQM awareness program and therefore did not

understand why this change was required.

There were two options -- mandate the change or change the mindset to accept the change. Since

the latter option produces a robust implementation that will not break down under pressures it

was agreed that the group would summarize TQM, the journey and the results obtained in the

project so far and also simulate the process with a simple exercise in front of the department

head. This session was highly successful and led to the release of the person concerned on a

regular basis.

Step 6. Check the Result

The process was run for one month with regular checks. The results obtained were marginally

better than the trials conducted in Step 5:

Average 11 days

Sigma 9 days

Average+3 sigma 38 days

Step 7. Standardize Control/Document the Improvement Story


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1. Essentially the in-house processes in two centers of processing -- the CPC and one sales

branch -- had been impacted so far. To make sure that the gains were held, control charts

were introduced both locations. Sample x-bar and sigma-control charts for the CPC are

shown below:

2. A special "Grind It In" session was conducted for line personnel to ensure that the control

chart was updated every day, and any deterioration was dealt with by finding and killing

the root causes of the problems.

3. Customer reaction: Sales management and sales agents (internal customers) clearly

noticed the difference. For instance one sales manager reported that a customer had

received a policy within a week of giving a proposal and was so amazed that he said, "If

you give such service I will give you the next policy also!"

4. Adoption of a similar process at the CPC and the model branch for medical policies has

already reduced the average+3 sigma of turnaround time by 70 percent -- from 118 days

to 37 days. The corresponding all-India reduction was from 118 days to 71 days -- a 60

percent reduction.

5. The project objective of 50 percent in the first stage has been achieved.

6. A quality improvement story was compiled by the project Leader for training and

motivating all employees.

Future Actions

Non-medical policies: Goal to reduce turnaround from 42 days to about 15 days.

1. Roll out process to branches to achieve 24 days throughout the country.

2. Minimize rework by analyzing, prioritizing and training sales branches to avoid the

causes of rework.

3. Working with the bank to improve the turnaround time of banking checks.

4. Considering processing proposals while check clearance is in progress.

Medical policies: Goal to reduce turnaround from 71 days to about 24 days.

1. Roll out process to branches to reduce turnaround from 71 to 37 days.

2. Streamline the process of medical exam of the client from 37 to 24 days.


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TQM Tools

Total Quality Management (TQM) Tools

Total quality management (TQM) tools help organizations to identify, analyze and assess

qualitative and quantitative data that is relevant to their business. These tools can identify

procedures, ideas, statistics, cause and effect concerns and other issues relevant to their

organizations. Each of which can be examined and used to enhance the effectiveness, efficiency,

standardization and overall quality of procedures, products or work environment, in accordance

with ISO 9000 standards (SQ, 2004).

According to Quality America, Inc. (ReVelle, 2003) the number of TQM tools is close to 100

and come in various forms, such as brainstorming, focus groups, check lists, charts and graphs,

diagrams and other analysis tools. In a different vein, manuals and standards are TQM tools as

well, as they give direction and best practice guidelines to you and/or your staff.

TQM tools illustrate and aid in the assimilation of complicated information such as:

· identification of your target audience

· positive and negative forces affecting business

· assessment of customer needs

· competition analysis

· market analysis

· brainstorming ideas

· productivity changes

· various statistics

· staff duties and work flow analysis

· statement of purpose

· financial analysis

· model creation


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· business structure

· logistics analysis

The list goes on, though essentially TQM tools can be used in any situation, for any number of

reasons, and can be extremely effective if used properly.

TQM Tools

The following are some of the most common TQM tools in use today. Each is used for, and

identifies, specific information in a specific manner. It should be noted that tools should be used

in conjunction with other tools to understand the full scope of the issue being analyzed or

illustrated. Simply using one tool may inhibit your understanding of the data provided, or may

close you off to further possibilities.

Pie Charts and Bar Graphs

· Used to identify and compare data units as they relate to one issue or the whole, such as

budgets, vault space available, extent of fonds, etc.

Histograms

· To illustrate and examine various data element in order to make decisions regarding them.

· Effective when comparing statistical, survey, or questionnaire results.

Run Chart

· Follows a process over a specific period of time, such as accrual rates, to track high and low

points in its run, and ultimately identify trends, shifts and patterns.


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Pareto Charts / Analysis (designed by Vilfredo Pareto)

· Rates issues according to importance and frequency by prioritizing specific problems or

causes in a manner that facilitates problem solving.

· Identify groupings of qualitative data, such as most frequent complaint, most commonly

purchased preservation aid, etc. in order to measure which have priority.

· Can be scheduled over select periods of time to track changes. They can also be created in

retrospect, as a before and after analysis of a process change.

Force Field Analysis

· To identify driving and restraining forces occurring in a chosen process in order to

understand why that particular process functions as it does. For example, identifying the

driving and restraining forces of catering predominantly to genealogists.

· To identify restraining forces that need to be eradicated, or driving forces that need to be

improved, in order to function at a higher level of efficiency.


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Cause and Effect, Ishikawa or Fishbone Diagrams (designed by Kauro Ishikawa)

· Illustrates multiple levels of potential causes (inputs), and ultimate effects (outputs), of

problems or issues that may arise in the course of business.

· May be confusing if too many inputs and outputs are identified. An alternative would be a tree

diagram, which is much easier to follow.

Focus Groups

· Useful for marketing or advertising organizations to test products on the general public.

· Consist of various people from the general public who use and discuss your product,

providing impartial feedback to help you determine whether your product needs improvement or

if it should be introduced onto the market.

Brainstorming and Affinity Diagrams

· Teams using creative thinking to identify various aspects surrounding an issue.

· An affinity diagram, which can be created using anything from enabling software to post-it

notes organized on a wall, is a tool to organize brainstorming ideas.

Tree Diagram

· To identify the various tasks involved in, and the full scope of, a project.

· To identify hierarchies, whether of personnel, business structure, or priorities.

· To identify inputs and outputs of a project, procedure, process, etc.


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Flowcharts and Modelling Diagrams

· Assist in the definition and analysis of each step in a process by illustrating it in a clear and

comprehensive manner.

· Identify areas where workflow may be blocked, or diverted, and where workflow is fluid.

· Identify where steps need to be added or removed to improve efficiency and create

standardized workflow.


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Scatter Diagram

· To illustrate and validate hunches

· To discover cause and effect relationships, as well as bonds and correlations, between two

variables

· To chart the positive and negative direction of relationships

Relations Diagram

· To understand the relationships between various factors, issues, events, etc. so as to

understand their importance in the overall organizational view.

PDCA

· The Plan-Do-Check-Act style of management where each project or procedure is planned

according to needs and outcome, it is then tested, examined for efficiency and effectiveness, and

then acted upon if anything in the process needs to be altered.

· This is a cyclical style to be iterated until the process is perfected.

All of these TQM tools can be easily created and examined by using various types of computer

software (Pollock, 2003) or by simply mapping them out on paper. They can also be easily

integrated into team meetings, organizational newsletters, marketing reports, and for various

other data analysis needs. Proper integration and use of these tools will ultimately assist in

processing data such as identifying collecting policies, enhancing work flow such as mapping

acquisition procedures, ensuring client satisfaction by surveying their needs and analyzing them

accordingly, and creating an overall high level of quality in all areas of your organization.


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Wrapping Up

In world trade, for buyers and sellers to work together there must be trust. Standards can provide the necessary bridge of confidence and understanding that builds mutual trust,

helping trade to thrive.

Sales are the lifeblood of any business, so the implementation of standards helps sales. This is the case whatever the size of the business or the sector they are operating in.

Establishing clear standards creates order in an increasingly complex world. Standards meet changing

market needs and are customer driven. Businesses benefit from standards because they establish

ground rules that help to guarantee quality. Achieving certification to a standard might add reassurance

for its customers and enables a business to boost its sales performance. Consumers benefit because

their safety and their satisfaction are both greatly enhanced. Governments benefit because such

measures contribute to greater productivity and economic growth, and safer work, leisure and home

environments.

IBM was the world's first national standards making body. Today it is the most prestigious

international standards institution. It works with the British government, manufacturers and other

stakeholders to create quality standards. These guarantee fitness for purpose, and help British

manufacturers to gain a competitive edge both in the UK and internationally. IBM assists British

businesses in all markets to grow and to concentrate on meeting customers' requirements.

Total Quality Management

Documents

acceptability of tqm

total quality management

quality management strategies

awareness of quality

quality standard

quality measurement

quality scenario

pune total quality management