Tamilnadu Open University Y 2008 M.B.A. DEGREE EXAMINATION – JUNE 2008.(AY 2005–2006 onwards)TOTAL QUALITY MANAGEMENTTime : 3 hours Maximum marks : 75 Answer for 5 marks questions should not exceed 2 pages.Answer for 10/15 marks questions should not exceed 5 pages.PART A — (3 × 5 = 15 marks) Answer any THREE questions. All questions carry equal marks.

1. Explain the concept ‘quality in process’.

Traditional way of measuring Quality was the extent to which the product and service satisfy the customer. When the customer does not inspect, the inspection will be done by the company to ensure that the product meets the requirements. Since the product is an output, this is called quality checking at output.

The verification of quality at the output stage has disadvantages. First is being the last operation, it could be missed or done inadequately. In that case, customers may get the defective products. Secondly, it is possible that the inspection detects serious defects and the product may have to be reworked and retested. This will take time and delivery is missed leading to dissatisfaction of customer. Third and the most essential point is that the processes do not improve because the final inspection is expected to weed out the defectives and despatch only good ones. In the case of service, the output cannot be inspected at all as the service like education or legal advice is tendered in presence of customer.

Quality in process means we monitor quality right from design stage to shipping stage or even to installation. Indicators and measures are selected in every stage to monitor the process and hence the quality of output and interim outputs. If the output at any stage does not conform to the norm or the process responsible for quality is deviating, the process is topped and the cause is investigated. When the cause is found and corrected, the process resumes and hence the chances of customer getting a defective product are remote.

In process Quality also defines acceptance levels for the tools and fixtures used in manufacturing. For instance, if the tool life is more than say x hours the procedure may require that tool to be replaced rather then continue till the product becomes unacceptable. Rigorous instructions on the periodic maintenance activities of critical machines are issued so that the machines do not become erratic leading to the defects in the product.

Training of people and defining the skill levels of personnel and daily checking that the operations are performed by them is very much part of implementing in process Quality. This is required not only in manufacturing industry but also in service industry where a particular operation say approval of loan or a building design should not be done by every one but only by the qualified personnel.

Many times the wrong decisions are taken due to the error in instruments. Calibration of instruments and verifying that they are error free is a part of in process Quality.

In short, the factors responsible for the quality are at every stage are determined, controlled as per the requirements to achieve the output which is defect free.

2. What is strategic quality planning?

Strategic Quality planning means that the quality processes are planned in a way that it helps the company to achieve its strategic objectives. The Planning here is not done to achieve routine production targets or to dispatch goods as per the agreed contractual terms but planning goes beyond the routine activities intended to run the business. Strategic Quality planning involves the activities for a new product introduction to its servicing in a comprehensive manner.The product’s features are defined by discussions with customer groups and the prioritisation of what features are to be incorporated is decided through a Quality Function Deployment exercise. Then the features and characteristics are designed by the design team. Though the design function is responsible for the design the review is done by a cross functional team and with tools like Failure Mode Effect analysis.

Then, critical processes are identified and the people are trained in the skills required. The monitoring of the performance of the new product in the field is done to verify whether the customers are getting the value for the money and whether the product is reliable.Thus strategic Quality planning is an activity that extends from collection of customer requirements to customer satisfaction determination.

3. What do you understand by quality circles?

Quality Circles are the small groups which are formed voluntarily by workers or employees of a specific location to carry out systematic improvements. QC Circle movement started in Japan in 50s and spread to all the countries. Some of the unique features of QC Circles are a) the voluntary nature of the circles b) the meetings held weekly outside the office hours c) the use of 7 QC Tools to solve the problems. Each circle takes about 3 to 4 weeks to solve a problem which may something to do with poor housekeeping or erratic machine and then present the solutions to the management.All countries including India hold annual contests for encouraging the Quality Circles. Apart from workers, many companies even encourage their staff and managers to take part in Quality circles.

4. Explain any two factors that link TQM and human resources.

TQM is anchored on better employee involvement in solving problems which occur day to day in the company. HR is interested in involvement and engagement of people in productive tasks.TQM treats all employees as equal. Respect for individual is enshrined as one of the principles of TQM and that is how the concepts of brainstorming or Kaizen are evolved. Human Resources Management works in the same principle to treat all employees alike and in a fair manner. 5. What is re-engineering?

Re engineering also called as Business process Reengineering (BPR) is the intervention to drastically change the processes and redesign them to satisfy the customer expectations of Quality and delivery. Reengineering became necessary as the processes in the organization tended to accumulate lot of non value added activities resulting in increased costs and delays. For instance, the billing process or a complaint management process became so slow that many times the customers were frustrated. But, re-engineering looks at the processes from the angle of throughput and ruthlessly attacks delays and bottlenecks. The advocates of Re engineering like Michael Hammer argue that the drastic changes help the company to shed the flab and become more efficient and invariably lead the efforts to reduce headcount. Some TQM experts believe that such drastic changes often have limitations and are not sustainable in the long run. They also advise involvement of employees in making the processes more efficient rather than looking at them as part of the problem. While BPR was very popular in the 80s its popularity has declined as the companies felt the soft aspects are ignored by the BPR methodology which is focused on the process velocity and cost /time reduction. The indiscriminate use of BPR consultants by some management to justify their decision to reduce manpower also cast a shadow on re engineering efforts. Still, Re engineering remains a viable option in case the process is full of chronic problems and the competition is way ahead like in Air India or some nationalized banks.

PART B — (4 ´ 15 = 60 marks)Answer any FOUR questions. Each question carries 15 marks.

1. Explain the evolution of TQM concepts? What is its significance today?

It started with some control which was exercised by various guilds of manufacturers in 19th century in England but in 1920s, it appears to have crystallised into a function called Quality control, Then the activities to be done by all functions to ensure the error free product were combined to be called Total Quality Control or TQC (Fiegenbaum) , After the World War II, when the QC experts visited Japan and promoted the concepts of Quality control for all it was called Companywide Quality Control. Dr W E Deming introduced the PDCA ( Plan Do Check Act) cycle for continuous improvement and so the word became TQM or Total Quality management. At this point of time, the statistical concepts of Quality got introduced and the industry got greatly benefited due to control charts. Juran first introduced Quality Trilogy which means Quality planning Quality control and Quality improvement are part of the responsibility of every manager. With this the involvement of management became part of TQM.Ishikawa contributed with the cause and effect diagram and made the process of problem solving more disciplined and systematic. This led to the formation of Quality circles and thousands of workers started practicing the concepts of TQM.Phil Crosby defined the absolutes of Quality and emphasised on zero defect. While the zero defects campaign could attract a lot of people, TQM started embracing the six sigma methodology which was a product of Motorola in 1980s. Around the same time, Quality management standards also appeared in the scene. Then the TQM awards were introduced in 1990s wherein the companies got assessed for their TQM initiatives and were recognized by the Governments. Today, all these concepts are significant. Quality circles are still popular in many companies. Six sigma methodology is having lot of followers. Awards like Baldrige and Deming are challenged by many companies.

TQM has also made inroads into service sector and retail as well as banking and hospitality sector. On the whole, the future for TQM looks as strong as it was in 1950s.

2. What is bench marking? Link the various factors that have impact on customer satisfaction through quality process.

Benchmarking is the process by which one organization learns the best practices of another organization which is better than itself in some of the processes. Benchmarking is widely adopted in all countries and in some of the well known companies like Xerox.

Benchmarking consists of the following steps.

1. Map the process you are interested in benchmarking.2. Identify the key Characteristics in the process which are to be improved.3. Identify the partners who are good at these processes4. Visit the partners and observe the processes at close quarters.5. Adapt or adopt the process to suit at your end.

The various factors that have impact on customer satisfaction through Quality process are as follows:

1. Achieving Conformance of product /service to specifications which is ensured by the design.2. Achieving reliability of the product which is ensured by the process capability.3. Timely delivery which is a result of meticulous planning and coordination.4. Aesthetic packing which is due to packing quality.5. Clear user manual and service attention in case of problems 6. Hazard free operation which is built in by the safety in design.

Quality process enables these to happen with the help of a) Team work across the functions b) Ensuring Process capability c) Monitoring the process with the help of control charts

By the Quality process which flows through all operations leading to the supply of the product or delivery of service we are able to improve the customer satisfaction steadily.

3. What are the functions of quality control? Explain different control charts.

The functions of Quality control are as follows:

Traditionally Quality control has been defined to be carrying out routine inspection activities and dealing with disposition of non conforming items. But, this has been changed over a period of time. Authors like Shigeru Mizuno (Company wide Quality Control –Asian Productivity organization) have listed the following functions for Quality control.

1. QC at Design and Development stage2. Quality Planning for new product3. Design evaluations4. Design review5. product liability considerations at design stage6. Process analysis7. Deciding on optimum standards for causes of variations in processes8. Evaluating process capability9. Releasing technical standards and work standards10. Implementing process control11. Evaluation of suppliers12. Improvements in production and in procurement

The different control charts are as follows:

If the data is variable the following control charts are used.

X bar R chart

Here the control chart is drawn for measurements taken from a continuous data like temperature. Every subgroup consists of 4 to 5 readings and the mean of the subgroup x bar is plotted. R chart is drawn for the range within each subgroup. This is the most popular control chart and it follows the normal (Gaussian) distribution.

I MR chart

In case of individual readings like the time taken for a patient, sub groups cannot be employed and so Individual values (x) are plotted. Moving Range values are progressively plotted in MR chart.

In case of attribute (or discrete) data the following charts are used.

Np charts are drawn for number of non conforming parts.

P charts are drawn for proportion defectives

Both the above control charts follow the principles of binomial distribution. (Failures and successes

Being the two outcomes of any event)

For small numbers of defects over a large number of parts e.g. printing errors in words in newspaper

Defect charts like c chart or u chart are used.

C chart is used for number of defects/unit.

U chart is used for average number of defects/unit

These follow Poisson distribution and have the ability to monitor even processes creating small number of defects.

Depending on the distribution and the nature of data, we use the control charts which are appropriate. 4. Is ISO 9000 same as TQM? Justify your answer in detail.

ISO 9000 series of standards are Quality system models released in 1980s by the International Organisation for standardization. These are conformance standards and companies follow the requirements in these standards and get certified.

TQM is not a standard but a philosophy or a way of working. It has evolved over five decades. It has no certification nor are there any agencies who can actually verify the implementation of TQM.However, the ISO standards have taken the guidelines from TQM.

As TQM emphasizes on process approach, ISO standards while introducing the 2000 version have gone for a process approach. The standard was very clear that the organization should describe its activities as interrelated processes and define them in the manual.

TQM insists on “Building Quality in” and not “inspecting Quality”. Inspection has been less emphasized in ISO standard and in its place Quality planning occupies a major place. Quality planning, in fact, touches upon design, procurement and production or service.

Prevention of defects is the main objective of TQM. This is done by preventive action. ISO standard in its 2000 version included specific requirements as follows:

1. Design Review and verification Clause no 7.3.2. Process validation clause no 7.5.23. Supplier evaluation clause no 7.44. Control of measuring equipment clause no 7.65. Checking on Competences of people. Clause no 6.26. Work environment monitoring clause no 6.47. Infrastructure control clause no 6.3

This shows that ISO standard has seriously looked upon its role as the first step of TQM for every organization.

However, there is a long way to go.

TQM believes in continuous improvement through employee involvement. ISO standard is yet to formulate a method of motivating people to work in teams and improve the organization. TQM also relies on statistical techniques and principles of reliability. ISO standard though hints at analysis in clause no 8.1 is yet to stress on such tools.

The ISO enforcement is through a series of internal and external audits. There are certain people who view the audits with skepticism because it is not possible to diagnose the problems through an audit mode in a short time. TQM needs a team to diagnose the problems through a detailed study of data and interviews of people. The diagnosis is a point which is not touched upon by ISO.

TQM believes that internal customers are important. Ishikawa said “Treat the next process as your customer” This means that the process owner should derive his measures of effectiveness not from his /her imagination or experience but for the feedback given by the In ISO still the flavour of treating the down stream process as a customer is not available.

TQM is all about customer delight. ISO standard stops at customer satisfaction. This means that organization may lose the advantage of having a competitive edge over others in a closely contested arena.

TQM is also about stakeholder welfare like employee satisfaction and supplier satisfaction. In ISO standards we still do not find the mention of employee satisfaction and so stakeholders are left out.

It is true that TQM and ISO are aiming at the same objectives abut the scope and expanse of TQM is very vast and cannot be included in ISO standards. At best, it is a good first step.

5. Explain productivity and quality. Expand the concept of productivity cost with reference to TQM.

Productivity is defined as the Number of units produced /hour or number of tasks completed/unit time.

It could be categorized as shop productivity which is for the whole section. For example the whole machine shop produces 300 cylinders per hour. Machine productivity for instance the tube mill produces 3 tubes per minute. Or employee productivity for example the painter finishes 1 cupboard per hour.

Quality is the extent to which the characteristics of the product or service satisfy the requirements of the customer.

This can be categorised as the performance Quality or appearance Quality or service Quality depending on the offering.

In TQM, we try to reduce costs and increase productivity and improve Quality. How is this seemingly contradictory statement achieved?

Customers want right products in time. We lose out on time due to poor planning and poor coordination with suppliers. TQM insists on advance planning and close working with suppliers. Due to the fact that cooperation exists between suppliers and organization, last minute emergency purchases and increased transport costs are avoided. Cost comes down.

Once the materials are received in the factory, products are produced but with mistakes. Productivity goes down as the products need to be reworked. Cost of rework and rejection is incurred. In TQM, process control is implemented whereby capability of process is first ensured before starting the production and monitored. So, the defectives are few and productivity increases and cost comes down.

Products are shipped to customers but still there warranty failures leading to replacement costs. In TQM, reliability of the product gets due attention and warranty failures come down and so the costs come down.

Thus, TQM implementation helps us in all these fronts simultaneously.

1. Time for processing is reduced.2. Productivity is increased.3. Cost of rework and rejection is reduced.4. Warranty failures reduce steadily.

Apart from the costs coming down and productivity increasing there is cascading effect that is repeat orders. Due to the good quality of the product in the field, customers place repeat orders and this reduces the costs further as the shop is able to run to its full capacity.

This concept is explained by the “Cost of Quality” in TQM. According to this theory, the measure of the effectiveness of implementation of TQM lies in lowering the Cost of Quality over the period of time. Cost of Quality consists of a) cost of internal failures like rejection and rework b) cost of external failures like warranty failures c) cost of appraisal like inspection d) Cost of prevention.

Out of these a b and c are considered to be cost of poor Quality which should reduce by systematic way of working. This is how the productivity, costs and TQM are related.

6. Explain the various steps in inspection and quality control. They can be complimentary or supplementary to quality. Describe in detail.

The various steps in inspection are as follows:

1. Incoming inspection: This activity permits the products which are bought from others in the organization after verifying them. This is either through 100% or sampling but invariably is the first step in any factory.

2. In Process Inspection: This activity checks the conformance of the product at its various stages. For instance, the components are checked in machining stage. In many companies, this is done through sampling of components.

3. Final Inspection: When the product is ready and is about to be shipped, the product is tested and then certified as OK with respect to the requirements and specifications.

Quality Control is defined by ANSI as “the operational techniques and activities which sustain a quality of a product or service that will satisfy given needs”

This means that while inspection can identify whether a product is OK/ not OK, it does not take upon itself to use techniques that will sustain the good quality of a product.

Quality control as a discipline has following techniques:

1. Control charts2. Process Monitoring for continuous processes3. Process capability improvements4. Tools and Gauges control5. Equipment Qualification6. Training of People7. Aesthetics

Quality control has following stages in Product realization. It is more than inspection and virtually covers the entire range of activities.

If Quality is considered to be “Product Quality” (meaning conformance to specifications) then the following categorization can be done for various activities of Quality control.

Here the word supplementary means the activity is over and above what could be scope of ” product Quality” and complementary means the activity makes the “product Quality” complete in all respects.

1. Defining the Quality targets – Supplementary to Quality2. Design reviews and Prototype testing-Complementary to Quality3. Supplier selection and Pre Qualification-Complementary to Quality4. Process capability demonstration-complementary to Quality5. Defining the controls (control Plan) – complementary to Quality.6. Workmanship standards –supplementary to Quality7. Appearance standards- Complementary to Quality8. Packaging standardization-Supplementary to Quality.9. Training to workers in certain processes-Supplementary to Quality

7. What are various objectives of TQM? Explain with examples.

The objectives of TQM are as follows:

1. Customer delight: In TQM customer is the king and the delight of the customer is the objective. For instance, Motorola defined the objective of having less than 3 parts per million defective levels in their phones. This was far below the other manufacturers but Motorola wanted the customer to have superior faith in their products.

2. Reliable Product: In TQM, product should work safely and without interruptions in service due to some failures. For instance, auto makers measure their quality by telling the life time the key components work without failing like gear box 100,000 Kms of usage. This puts the manufacturer in a superior class as compared to others.

3. Employee Involvement: In case of TQM, the employees need to be involved in all improvements. The employees need to work in small groups/Quality circles and problem solving teams. For instance, Tata Steel asks their managers to ensure that 70-80% of their workers are involved in team working.

4. Continuous Improvement: In TQM, every process needs to be improved. Process improvement has to be triggered by feedback from customers but backed by sound approaches. Many Japanese companies adopt a methodology of problem solving by working with 7 QC tools.

5. Education of workers: In TQM, every worker is an asset and the organization needs to put in efforts to educate the worker so that he/she is able to contribute in a fitting manner. Toyota has a class room even in shop floor (Obaya) where the mistakes are discussed and corrected.

6. Respect for individual: In TQM, one is supposed to respect every person from CEO to Chauffeur. The person has certain unique skills which need to be tapped and if we disrespect him/her the talents go waste. In TVS, the canteen is same whether for managers or workers. This reflects that the organization does not have any class differentiation.

7. Community Development: In TQM, every organization contributes to the community near its operations. The community provides all resources and so is the supreme stakeholder in any business. Tata Motors adopts villages around their plant at Pune and Jamshedpur and provides people with medical facilities.

8. Sustainability of operations: In TQM, short term profit is shunned and sustainability of operations is preferred. This is because the processes tend to be environment friendly and safe when the organization looks at long term effects rather than short term advantages. Rain water harvesting is done and solar heaters are installed by many companies.