t Qm Principles

8/13/2019 t Qm Principles

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Unit 2 - TQM Principles 1

Chapter 2

TQM Principles


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TQMs Customer Approach

the customer defines quality.

the customer is always right.

the customer always comes first. the customer is king.

quality begins and ends with the

customer


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ORGANIZATIONAL

HIERARCHIAL DIAGRAM


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Why Customer Satisfaction?

It is a Measure of Quality

Increasing Importance of Customer

Satisfaction as a measure of Quality is

due to worldwide competition.


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How TQM Helps Satisfying

Customers Expectations?What does it do?

TQM meets the Customer expectations to

the point that Customers are delighted soas to win them.

How does it do?

TQM keeps on understanding the fulfillingever-changing customer requirements and

expectations.


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Who Is The Customer?

Customer is one who purchases or patronizesfor the purpose of receiving products / services.

A customer is the most important visitor on ourpremises. He is not dependent on us. We aredependent on him. He is not an interruption inour work. He is the purpose of it. He is not

an outsider in our business. He is part of it. Weare not doing him a favor by serving him. He isdoing us a favor by giving us an opportunity todo so. Mahatma Gandhi


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Customer Satisfaction Model

(Teboul Model)

Source:Managing Quality Dynamics:

Englewood Cliffs

Company Offer

Customer Needs


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Types of Customers

External - outside the organization (people who

pay the bills.)

End-user customers

Manufacturer (OEM) for suppliers. Internal - people within your organization who

receive your work

In many situations, producers have multiple

customers and therefore find it useful to identifycore customers


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Customer Perception Of Quality

Factors influencing purchase of a product in

descending order of ranking:

1. Performance

2. Features

3. Service

4. Warranty

5. Price6. Reputation

(As per ASQC Survey on end user)


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Feedback and Its Five Uses

Feedback Program to identify errors andto take corrective actions.

Five uses of Feedback:

1. To discover customers dissatisfaction

2. To discover relative priorities of quality

3. To discover opportunities for

improvement4. To identify customers needs

5. To compare performance


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Some Data on Customer

Attitudes and Loyalty(Source: Winning Back Angry Customers, Quality Progress,

1993)

An average customer with a complaint tells 9-10 people; if

it is resolved he/she only tells 5 people. For every complaint received, there are twenty others that

are not reported.

It costs 5-10 times more in resources to replace a

customer than it does to retain one.

Companies spend 95% of service time redressing

problems and only 5% trying to figure out what made the

customer angry.


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Methods to Collect

Customer Satisfaction Data Negative Feedback Analysis

customer complaints, warranty claims, repair records

focus on problems

concern: many dissatisfied customers do not complain (1/20

complain). Proactive Feedback (ask customers for their opinions) examples: customer surveys, focus groups, employees as

customers.

advantage: identify key product features and assess levels ofperformance.

Analysis of Competitor Products examples: Benchmarking, War Rooms or Tear Down Analysis advantage: Know thy competitor, know thyself


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How To Receive Feedback?

Methods to obtain Feedback from Customer:

1. Comment Cards

2. Customer Questionnaire/ Surveys

3. Focus Groups

4. Toll Free Telephone Lines

5. Customer Visits

6. Report Card

7. The Internet & Computers

8. Employee Feedback

9. Mass Customization

10. Using Customer complaints


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Service Quality

(Before, During and After the sale)Elements of Service Quality:

1. Organization

2. Customer Care3. Communication

4. Front-line People

5. Leadership


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Elements of Customer Services

Contd..Organization

1. Identify each market segment

2. Write down the requirements3. Communicate the requirements

4. Organize processes

5. Organize physical spaces


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Contd..Customer Care

6. Meet the Customers expectations

7. Get the Customers point of view8. Deliver what is promised

9. Make the customer feel valued

10.Respond to all complaints

11.Over-respond to the customer

12.Provide a clean and comfortablecustomer reception area


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Contd..

Communication

13.Optimize the trade-off between time and

personal attention14.Maximize the number of contact points

15.Provide pleasant, knowledgeable and

enthusiastic employees

16.Write documents in customer-friendly

language


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Contd..

Front-Line People

17. Hire people who like people

18. Challenge them to develop better methods

19. Give them the authority to solve problems

20. Serve them as internal customers

21. Be sure that they are adequately trained

22. Recognize and reward performance


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Contd..Leadership

23.Lead by example24.Listen to the front-line people

25.Strive for continuous process

improvement


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Kano Model

Spoken & Expected

Requirements

Unspoken But

Expected Requirements

Exciters

Customer Dissaatisfied

Customer Satisfied

Requirements

Satisfied

Requirements

Not Satisfied


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Customer Retention

Customer retention is more powerful and

effective than customer satisfaction.

Customer retention represents the

activities that produce the necessary

customer satisfaction that creates

customer loyalty, which actually improves

the bottom line.


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Employee Involvement

Any activity by which employees

participate in work-related decisions and

improvement activities, with the

objectives of tapping the creative

energies of all employees and improving

their motivation


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Levels of Employee Involvement

1. Information sharing

2. Dialogue

3. Special problemsolving

4. Intra-group problem

solving

5. Inter-group problem

solving

6. Focused problemsolving

7. Limited self-direction

8. Total self-direction


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Advantages of EI

Replaces

adversarial mentality

with trust and

cooperation Develops skills and

leadership abilities

Increases morale

and commitment

Fosters creativity

and innovation

Helps peopleunderstand qualityprinciples and

instilling them intothe organizationsculture

Allows employees tosolve problems atthe source

Improves qualityand productivity


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Motivation

An individuals response to a felt need.

Motivation is the internal state or condition

that activates and gives direction to thoughts,

feelings, and actions.

Theories

Content Theories: Maslow; MacGregor; Herzberg

Process Theories: Vroom; Porter & Lawler

Environmentally-based Theories: Skinner; Adams;

Bandura, Snyder & Williams


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Hierarchy of Needs Theory

(Maslow)Hierarchy of Needs TheoryThere is a hierarchy of fiveneedsphysiological, safety,social, esteem, and self-

actualization; as each need issubstantially satisfied, the nextneed becomes dominant.

Self-Actualization

The drive to become what one is capable of becoming.


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Maslows Hierarchy of Needs

Lower-Order NeedsNeeds that are satisfiedexternally; physiologicaland safety needs.

Higher-Order NeedsNeeds that are satisfied

internally; social, esteem,and self-actualization

needs.

Source: Motivation and Personality , 2nd ed,, by A.H. Maslow, 1970.Reprinted by permission of Prentice Hall, Inc., Upper Saddle River, NJ.


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Two-Factor Theory (Frederick

Herzberg)Two-Factor (Motivation-Hygiene) TheoryIntrinsic factors are related to job satisfaction,while extrinsic factors are associated withdissatisfaction.

Hygiene Factors

Factorssuch as company policyand administration, supervision,

and salarythat, when adequatein a job, placate workers. Whenfactors are adequate, people willnot be dissatisfied.


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Comparison of

Satisfiers and

DissatisfiersFactors characterizingevents on thejob that led to

extreme job dissatisfactionFactors characterizing

events on the job that

led to extreme job

satisfaction

Source: Reprinted by permission of Harvard Business Review. An exhibit from One More Time:

How Do You Motivate Employees? by Frederick Herzberg, SeptemberOctober 1987. Copyright 1987 by the President and Fellows of Harvard College: All rights reserved.


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Contrasting Views of

Satisfaction and Dissatisfaction


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Successful Empowerment

Provide education, resources, and

encouragement

Remove restrictive policies/procedures

Foster an atmosphere of trust

Share information freely

Make work valuable

Train managers in hands-off leadership Train employees in allowed latitude


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Training and Education

Quality awareness

Leadership

Projectmanagement

Communications

Teamwork

Problem solving Interpreting and

using data

Meeting customer

requirements

Process analysis

Process

simplification

Waste reduction

Cycle time reduction Error proofing


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Teams

A small number of people with

complementary skills who are committed to

a common purpose, set of performance

goals, and approach for which they holdthemselves mutually accountable

Effective teams are goal-centered,

independent, open, supportive, andempowered


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Types of Teams

1. Process improvement team

2. Cross-functional team

3. Natural work team

4. Self-directed/ self-managed work team5. Quality Circles

6. Problem solving team

7. Management team

8. Project team

9. Virtual team


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Ingredients for

Successful Teams1. Clarity in team goals

2. Improvement plan

3. Clearly defined roles

4. Clear communication5. Beneficial team behaviors

6. Well-defined decision procedures

7. Balanced participation

8. Established ground rules9. Awareness of group process

10. Use of scientific approach


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Functions of Teams

Implement

solutions

Identify

problems Select

problem

Collect

data

Focus

attentionFind

causesDevelop

solutions

Pick bestsolution

Develop

follow-up

planSolve

Identify

Analyze


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Team Member Roles

1. Team Leader

2. Facilitator

3. Recorder4. Timekeeper

5. Team Member


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Decision-Making Method

1. Non-decision

2. Unilateral decision

3. Handclap decision4. Minority-rule decision

5. Majority-rule decision

6. Consensus


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Stages of Team Development

1. Forming: Members become aware of theboundaries of acceptable behavior

2. Storming: Members start to realize the amountof work that lies ahead and rely solely on their

personal and professional experience3. Norming: Members begin to work together

4. Performing: Members begin performing bydiagnosing and solving problems and choosingand implementing changes

5. Adjourning: Members evaluate theirperformance, celebrate and disburse(temporary teams)


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Compensation and Recognition

Compensation

Merit versus capability/performancebased plans

Gainsharing

Recognition

Monetary or non-monetary

Formal or informal Individual or group


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Effective Recognition & Reward

Strategies Give both individual and team awards

Involve everyone

Tie rewards to quality Allow peers and customers to nominate and

recognize superior performance

Publicize extensively

Make recognition fun


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Performance Appraisal

How you are measured is how you perform!

Conventional appraisal systems

Focus on short-term results and individual

behavior; fail to deal with uncontrollablefactors

New approaches

Focus on company goals such as quality

and behaviors like teamwork

360-degree feedback; mastery descriptions


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Measuring Employee

Satisfaction and Effectiveness Satisfaction

Quality of worklife, teamwork,

communications, training, leadership,

compensation, benefits, internal suppliers

and customers

Effectiveness

Team and individual behaviors; cost, quality,and productivity improvements; employee

turnover; suggestions; training effectiveness


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Continuous Process Improvement

Continuous process improvement refers

to both incremental and breakthrough

improvements in the way an organization

does business Four key elements:

Objective

Design

Capabilities

Metrics


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Juran Trilogy

Quality Planning

Quality Control Quality improvement

Juran Trilogy


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01/29/06 SJSU Bus 142 - David Bentley 48

Jurans Quality Trilogy - 1

Quality planning

Identify who are the customers.

Determine the needs of those customers.

Translate those needs into our language.

Develop a product that can respond to those

needs.

Optimize the product features so as to meet

our needs and customer needs.


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01/29/06 SJSU Bus 142 - David Bentley 49

Jurans Quality Trilogy - 2

Quality Improvement

Develop a process which is able to produce

the product.

Optimize the process. Quality Control

Prove that the process can produce the

product under operating conditions with

minimal inspection.

Transfer the process to Operations


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Shewharts PDSA CYCLE in 1930


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Deming Wheel/ Cycle


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5-S

Creates a clean, ordered and disciplinedwork environment.

The 5 S are:

Seiri

Seiton

Seiso

Seiketsu

Shitsuke

But for those of us who dont speakJapanese


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Seriously, the 5 S are

Sort Separate and remove clutter and items unneeded in the workspace.

Extraneous items impede the flow of work.

Set in Order Organize what is left to minimize movement and make things clear.

Shine (and inspect) Clean area, storage, equipment, etc. and inspect for warning signs of

breakdowns.

Standardize Set up an area with 5-S supplies (cleaning supplies, labels, colored

tape, other organizational items) and schedule time and responsibilityfor restoring work area to its proper condition regularly.

Sustain Audit area regularly, expand 5-S to other areas.


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Kaizen

Gradual and orderly continuous

improvement

Minimal financial investment

Involvement of all employees

Exploit the knowledge andexperience of workers


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Kaizen Process

t Qm Principles

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