TQM TRAINING MATERIAL

QUALITY DEPARTMENT

POWER SECTOR SOUTHERN REGION CHENNAI - 600 035

Page No 1 of 61

CONTENTS Sl. No. DESCRIPTION PAGE

No. 01 Introduction 02

02 BHEL Approach towards TQM 08

03 CII Model 10

04 Exhibits 40

Page No 2 of 61

INTRODUCTION Organisation’s Culture The Organisation’s culture is basically divided into three categories as follows;

Jungle Culture (fear or controlled culture) Zoo Culture (free or uncontrolled culture) Circus Culture (systematic or trained culture)

A) Jungle Culture: In Jungle, all the animals start the day with planning how to get a prey and how to avoid being a prey for others. These conditions create high fear complex and conscious movement, trying to maintain safe distance from one another. In some Organisation this fear (jungle) culture is followed which creates a great barrier to any incremental or break through improvements. B) Zoo Culture: In Zoo, all the animals are caged and are in no hurry to getting their food as the same is taken care of and there is no fear of being a prey for others. In some Organisation, such fear free culture is followed with highly defined boundaries of operation. Such culture normally is very rigid and greatly reduces scope for improvements and growth.

Page No 3 of 61

C) Circus Culture : The total operation of the Circus Culture is well disciplined, planned and trained to be systematic, integrated, innovative and synchronised. Also it always aims at continuous innovative improvement in all their functional areas to achieve the satisfaction of all stake holders. In few Organisation such culture is being followed which gives freedom for continuous improvements, benefiting all employees, customer, supplier, society and all stake holders. Every organisation is now striving to achieve basic cultural change mostly towards circus culture to achieve TQM through continuous improvement. Quality Management is broadly divided into two categories; 1. Standard based Quality Management 2. People based Quality Management Standard Based Quality Management Standard based Quality Management mainly focuses on developing quality system in line with the applicable national/ international standards, covering the entire functions and operations of the organisation. Such Quality systems clearly indicate the responsibility and authority of individuals/ teams of the Organisation. By implementing this Quality system, the organisation achieves fixed and standardised operating systems in their total functional areas.

Page No 4 of 61

The effectiveness of the implementation of the Quality system is assessed through internal/external quality audits. In addition Quality audit also aims at improving quality system, through corrective and preventive measures within the framework of the standards and Quality system. Standard based Quality Management has the following critical limitations:

Development of Quality system is directly linked with standards (E.g.ISO 9000 series)

Any major change or improvement in the Quality system is mainly based on change in standard

Once the Quality system is established and set, there is no much scope for improvement

To cite an example in PSSR, during the initiation of obtaining ISO 9002 accreditation in 1993, the Quality systems were developed in line with the ISO 9002 standard of 1987 revision status. This first established Quality system was in use till the standard was revised in the year 1994. The quality system was then fully revised in line with the revised ISO standard and is being followed till date. Hence, standard based quality management is considered as the first step for continuous improvement or TQM approach. People Based Quality management People based quality management mainly focuses on making people to recognise that quality is essential for

• Individual development • Organisation development • Customer delight

Page No 5 of 61

• Stake Holders’ satisfaction The success of People based Quality management is directly related to: 1. Top management involvement, drive and support

including formulating vision, Policy, strategy etc. 2. Involvement of all people (employees) in aiming at

continuous improvement 3. Understanding and satisfying the needs and

expectations of customer, suppliers and employees 4. Effective utilisation of all resources 5. Controlling and upgrading all processes and

technologies 6. Linking the effect of the above directly to

customer/employees satisfaction, benefit to society and organisation business results.

To achieve the above through structural approach, a number of models have been developed by various international institution/organisations. The following are a few internationally recognised TQM models. 1.Demings Model - Adopted by Japanese Organisations 2.Malcolm Baldridge Model - Adopted by American Organisations 3.EFQM Model - Adopted by European Organisations The models not only guide the organisation towards Total Quality Management approach but also help to evaluate the implementation status, improvement achieved and its

Page No 6 of 61

real effect on their business results focusing customer, employees, supplier and stakeholders. These internationally accepted models guide all types of organisations to achieve structured approach in continuous improvement through TQM. TQM is centered on the principles of Customer focus, continuous improvement, defect prevention rather than detection and recognition that responsibility for quality is shared by all of us. Further, the organisation’s approach, functions and technologies are to support these four principles. Definition of Total Quality Management (TQM) Management approach of an organisation centered on Quality, based on the perception of all its members are aiming at long term success, through customer satisfaction and benefits to all members of the organisation and to society. TQM has the following dimension Total - Satisfy all stake holders Quality - Sustained customer focus Management - Continuous improvement with fact and data based decisions in a planned way The main tool for continuous improvement

According to the Quality Gurus, the continuous improvement can be achieved only through PDCA – Cycle.

ACT PLAN

CHECK DO

That is, PLAN your activities first, then DO (execute), CHECK (look for corrections, if any) and then ACT (after taking corrective action)

Page No 7 of 61

Page No 8 of 61

BHEL ‘s APPROACH TOWARDS TQM The top management of BHEL initiated TQM movement during 1994 and decided to follow the EFQM model adopted by Confederation of Indian Industry (CII) titled “The CII Model for Total Quality Management”. This model is being widely adopted by a number of Organisations in India. The following three models are well recognised for purposes of award in India. 1. Rajiv Gandhi National Quality Award - by Govt. of

India 2. Golden Peacock award - by Institute of Directors 3. CII Exim award for business excellence - by CII Out of the above three models, the CII model alone provides guidelines for self-assessment by the organisation itself as well as assessment by CII for award purpose. In BHEL the first self assessment based on CII model was done during Nov. 1995, by the trained TQ Assessors under the guidance of EFQM expert from UK and CII experts. Subsequently, two self assessments during Nov. 96 and Sept. 97, were done under the guidance of CII experts. TQ self assessment is being conducted every year in the month of September. TQM Approach through CII Model This model provides a generic frame work of criteria that can be adopted by any Organisation. The basic nine main criteria of this model is divided into 33 sub-criteria. These 33 sub-criteria’s are further split into no. of bullet

Page No 9 of 61

points to detail out the sub/main criteria requirements. The following are the basic two steps to be followed by an organisation to achieve continuous improvement or TQM approach through well defined structured model. 1. Understand the principles and requirement of the

model by every employee 2. Align/tune the activities, functions and operations of

the organisation with the principles and requirements of the model.

In any organisation, the success of TQM approach mainly depends on 1. Top management’s faith and belief 2. Top management’s support 3. Top management’s encouragement 4. Top management’s involvement 5. Top management’s initiative Hence the percentage of success in TQM approach is directly proportional to involvement/ approach of Top management. Matching the TQM model with Organisation’s approach Every Organisation develops its own system, style and approach to manage their business operations. Such system, style and approach, if followed for a long period without change, become common practices of their business operation. Once the common practices start dominating the organisations operation, it leads to little scope for any change through commonsense approach for improvement. Hence it is necessary for the organisation to formulate a structured “approach’ to

Page No 10 of 61

ensure continuous improvement in all their operations. To achieve this, the organisation’s approach and practices are to be perfectly aligned and blended with all the requirements detailed in the TQM model adopted. To achieve this, the first step is to understand the requirements of the model at all levels. CII MODEL FOR TQM In order to undertake Self Assessment, an underlying framework is necessary for which BEHL has selected the CII model for TQM. Although each organisation is unique, this model provides a generic framework of criteria that can be applied widely to any organisation or component part of organisation. This model is mainly based on the following. Customer Satisfaction, people (Employee) satisfaction and Impact on Society are achieved through Leadership Driving Policy and Strategy, People Management, Resources and processes leading ultimately to excellence in Business Results

Page No 11 of 61

CII Millennium Model for Excellence Enablers Results

1. Leadership 100 Points

5. Processes 140 Points

7. People Results 3. People

9. Key Perform

ance R

esults 150 Points

90 points 90 points

2. Policy & Strategy

6. Customer Results80 points 200 points

8. Society Results

60 points 4. Partnerships and Resources 90 points

Innovation & Learning

Enablers 500 Points (50 %)

Results 500 Points (50 %)

Excellent Results with respect to Performance, Customers, People, and Society are achieved through Leadership driving Policy & Strategy, People, Partnerships & Resources, and Processes. The customer results has the highest points.. viz 200

Page No 12 of 61

Each of the nine elements shown in the model is a criterion that can be used to assess the organisation’s progress towards business excellence. The model is basically divided into two major categories as ;

Enablers

Results The Enablers criteria are concerned with how the Organisation approaches each of the criterion parts. The organisation has to provide information required on the excellence of the approach used and the extent of deployment of the approach vertically through all levels of the organisation and horizontally to all areas and activities. The Results criteria are concerned with what the Organisation has achieved and is achieving. SELF ASSESSMENT What is Self Assessment? Self Assessment is a comprehensive systematic and regular review of an organisation’s activities and results referred against a model. The self assessment process allows the organisation to discuss clearly its strengths and areas in which improvements can be made and culminates in planned improvement actions which are then monitored for progress.

Page No 13 of 61

Self assessment is a process which

Enables fast, accurate and meaningful measurements of quality, strength and weakness

Helps track progress over a period of time Establishes base line for benchmarking Fosters understanding of own business processes

What are the benefits of Self Assessment

A Vigorous and structured approach to business improvement

An assessment based on facts and not individual perception

A means to achieve consistency of direction and consensus on what needs to be done through every one in the organisation sharing the same conceptual base

A means to educate people in the organisation on how to apply, in a meaningful way, the principles of TQM

A means to integrate various quality initiatives into normal business operations

A powerful diagnostic tool An objective assessment against a set of criteria

which has become widely accepted A means of measuring process over time through

periodic self assessment Process induced improvement activity focused where

it is most needed. A methodology for application at all levels ranging

from individual business units up to the organisation as a whole

A means to create enthusiasm amongst the people within the organisation and give fresh impetus to their pursuit of business excellence

Page No 14 of 61

Opportunities to promote and share excellent approaches within different areas of the organisation or as a wider scale with other organisations of a similar or diverse nature

Opportunities to recognise both progress and outstanding levels of achievement through internal awards

A link between what the organisation needs to achieve and how it puts in place strategies and processes to deliver its objectives

A means to bench mark internally as well as against other organisation.

To summarise, the process offers the organisation an opportunity to learn

About the organisations strength and Areas For Improvement (AFIs)

About what TQ means when applied to own organisation

About how far down the Quality road the organisation has traveled

How much further the organisation has to travel and how it compares with others.

What to do after Self Assessment 1. The organisation shall formulate methodology to

prioritise AFIs for achieving continuous improvement 2. Identify individual/team with authority, responsibility

and completion target for each AFI/continuous improvement projects

3. Achieve incremental or break through improvement on AFI/ projects

4. Strengthening strength further 5. Periodic review of TQM implementation status

Page No 15 of 61

6. Continue the operation every year. What is Position Report. The position report is:

A mirror or photograph reflecting the total operation, function and activities of the organisation.

Detailing all the requirements stated in the model adopted

Covering the operations of an organisation for the specified period (for BHEL one year)

Indicating the past data (min.5 years) showing both positive and negative trends of various business results and continuous improvement

Visibly showing the growth of the organisation year after year

Showing the comparison with

1. Achievement with respect to own targets 2. Achievement with respect to competitor’s

performance 3. Achievement with respect to best in class

organisation

A powerful tool for reflecting the organisation’s growth.

CII Model details: Criterion 1 Leadership

Definition Excellent Leaders develop and facilitate the achievement of the mission and vision. They develop organizational values and systems required for sustainable success and implement these via their actions and behaviours. During periods of change they retain a constancy of purpose. Where required, such leaders are able to change the direction of the organization and inspire others to follow. 1a Leaders develop the mission, vision, values

and ethics and are role models of a culture of Excellence

They may include developing the organisation’s mission, vision and cultutre; developing and role modeling values, ethics and public responsibilities that support the culture; reviewing and improving the effectiveness of personal leadership behaviours; being actively involved in improvement activities; stimulating and encouraging empowerment, creativity and innovation, e.g. by changing the organisation’s structure, funding learning and improvement activities; encouraging, supporting and acting upon the findings of learning activities; prioritizing improvement activities; stimulating and encouraging collaboration within the organisation.

1b Leaders are personally involved in ensuring the organisation’s management system is developed, implemented and continuously improved

Page No 16 of 61 This may include

Page No 17 of 61

aligning the organisation’s structure to support delivery of its policy and strategy; ensuring a system for managing processes is developed and implemented; establishing clear ownership of processes;. ensuring a process for the development, deployment and updating of policy and strategy is developed and implemented. ensuring a process for the effective governance of the organization is developed and implemented. ensuring a process for the measurement, review and improvement of key results is developed and implemented. ensuring a process, or processes, for stimulating, identifying, planning and implementing improvements to enabling approaches, e.g. through creativity innovation and learning activities, is developed and implemented.

1c Leaders are involved with customers, partners and representatives of society.

This may include: meeting, understanding and responding to needs and expectations; establishing and participating in partnerships; establishing and participating in joint improvement activity; recognising individuals and teams of stakeholders for their contribution to the business, for loyalty etc; participating in professional bodies, conferences and seminars, particularly promoting and supporting excellence; Promoting, supporting and engaging in activities that aim to improve the environment and the organisation’s contribution to society with the view to respecting the rights and interests of future generations.

1d Leaders reinforce a culture of excellence with the organisation's people

This may include: personally communicating the organisation’s mission, vision, values, policy and strategy, plans, objectives and targets to people; being accessible, actively listening inspiring, uniting and responding to people; helping and supporting people to achieve their plans, objectives and targets; motivating and enabling people to participate in improvement activity; recognising both team and individual efforts, at all levels within the organisation, in a timely and appropriate manner. promoting and encouraging equal opportunities and diversity.

1e Leaders identify and champion organisational change

This may include:

Page No 18 of 61

understanding the internal and external drivers of change for the organisation; identifying and selecting changes that need to be made within the organisation, to the organisation model and in its external relationships; leading the development of change plans; securing investment, resources and support for change; managing the delivery and risks of the overall portfolio of change programmes; ensuring the effective delivery of change and managing stakeholders communicating changes and the reasons for them to the organisation's people and other stakeholders; supporting and enabling people to manage change; measuring and reviewing the effectiveness of changes

and sharing the knowledge gained.

Criterion 2 Policy and Strategy

Definition Excellent organisations implement their mission and vision by developing a stakeholder focused strategy that takes account of the market and sector in which it operates. Policies, plans, objectives and processes are developed and deployed to deliver the strategy. 2a Policy and strategy are based on the present

and future needs and expectations of stakeholders

This may include: gathering and understanding information to define the markets and market segments the organisation will operate in both now and in the future; identifying, understanding and anticipating the needs and expectations of current and future stakeholders including customers, employees, partners, society and shareholders; identifying, understanding and anticipating developments in the market place, including competitor activity.

2b Policy and strategy are based on information

from performance measurement, research, learning and external related activities

This may include: analysing output from internal performance indicators; analysing output from learning activities; analysing external image and brand awareness data; analysing the performance of competitors and best in class organisations; analysing data regarding existing / potential partners' core competencies;

Page No 19 of 61

Page No 20 of 61

analysing data for both long term and short term social, environmental, safety and legal issues; analysing data on the effects of products and services throughout their entire life-cycle; identifying and understanding economic and demographic indicators; analysing data to determine the impact of new technologies and business models on the performance of the organization.

2c Policy and strategy are developed, review,

updated This may include:

developing, reviewing and updating policy and strategy consistent with the organisation’s mission, vision and values and concepts of excellence; balancing both short and long term needs and expectations of stakeholders; assessing risks and identifying ways of addressing these risks; identifying present and future competitive advantage; identifying core capabilities and needs for partnerships / alliances to deliver policy and strategy; reaffirming presence in established markets or requirement to change market approach; aligning strategy with those of partners’ and alliances; identifying critical success factors; aligning and continuously developing social and environmental standards with partners. evaluating the relevance and effectiveness of policy and strategy.

2d Policy and strategy are communicated and deployed through a framework of key processes

This may include: identifying and designing and communicating the

framework of key processes needed to deliver the organisation’s policy and strategy; communicating policy and strategy to stakeholders and evaluating the awareness of it; aligning, prioritising, agreeing, cascading and communicating plans, objectives and targets as well as following up achievements; establishing organisation wide reporting mechanism to track progress.

Criterion 3 People

Definition Excellent organisations manage, develop and release the full potential of their people at an individual, team-based and organisational level. They promote fairness and equality and involve and empower their people. They care for, communicate, reward and recognize, in a way that motivates staff and builds commitment to using their skills and knowledge for the benefit of the organisation. 3a People resources are planned, managed and

improved This may include:

developing human resource policies, strategies and plans; involving employees, and their representatives in developing human resource policies, strategies and plans; aligning the human resource plans with policy and strategy, the organisational structure and the framework of key processes; managing recruitment and career development and succession planning; promoting and ensuring fairness in all terms of employment including equal opportunities policies, strategies and plans; using people surveys and other forms of employee

Page No 21 of 61

feedback to improve human resource policies, strategies and plans; using innovative organisation methodologies to improve the way of working e.g. restructuring the supply chain, flexible team working.

3b People’s knowledge and competencies are identified, developed and sustained

This may include: identifying, classifying and matching people’s knowledge and competencies with the organisation’s needs; developing and using training and development plans to help ensure people match the present and future capability needs of the organisation; Developing, mentoring and training all people to help them realize and attain their full potential; designing and promoting individual, team and organisational learning opportunities; developing people through work experience; developing tem skills; aligning individual and team objectives with the organistion’s targets; reviewing and updating individual and team objectives; appraising and helping people improve their performance.

3c People are involved and empowered This may include:

encouraging and supporting individual and team participation in improvement activities; encouraging and supporting people’s involvement e.g. through in-house conferences, and community projects; providing opportunities that stimulate involvement and support innovative and creative behaviour; Training managers to develop and implement guidelines empowering people to take action;

Page No 22 of 61

Page No 23 of 61

encouraging people to work together in teams. 3d People and the organisation have a dialogue This may include:

identifying communication needs; developing communications policies, strategies and plans based on communications needs; developing and using top down, bottom up and horizontal communication channels; identifying and ensuring opportunities to share best practice and knowledge.

3e People are rewarded, recognized and cared for This may include:

aligning remuneration, redeployment, redundancy and other terms of employment with policy and strategy; recognising people in order to promote and sustain their involvement and empowerment; promoting awareness and involvement in health, safety, environment and issues on social responsibility. setting the levels of benefits, e.g. pension plan, health care, child care; recognising and taking account of diversity and different cultural backgrounds promoting social and cultural activities; providing resources and services that meet legal essentials and in some cases, exceed these requirements.

Criterion 4 Partnerships and Resources

Definition Excellent organisations plan and manage external partnerships, suppliers and internal resources in order to support policy and strategy and the effective operation of processes. During planning and whilst managing partnerships and resources they balance the current and

future needs of the organisation, the community and the environment. 4a External partnerships are managed This may include:

identifying key organisation and community partnership opportunities in line with policy and strategy and the organisation’s mission; structuring partnership and supplier relationships to create and maximise value; forming supply chain partnerships that add value to customers; Identifying and leveraging core competencies of partners and supporting mutual development; ensuring cultural compatibility and the sharing of knowledge with partner organisations; generating and supporting innovative and creative thinking through the use of partnerships; creating synergy in working together to improve processes and add value to the customer/supplier chain.

4b Finances are managed This may include:

developing and implementing financial strategies and processes for using financial resources in support of overall policy and strategy; designing the financial planning and reporting to cascade the financial stack holders expectations throughout the organisation; establishing reporting mechanisms; evaluating investment in and divestment of both tangible and non-tangible assets; using financial mechanisms and parameters to ensure an efficient and effective resourcing structure; developing and introducing methodologies for managing risks to financial resources to all

Page No 24 of 61

appropriate levels in the organisation; establishing and implementing core governance processes at all appropriate levels in the organisation.

4c Buildings, equipment and materials are managed

This may include: developing a strategy for managing buildings, equipment and materials that supports the organisation’s policy and strategy; managing the maintenance and utilisation of assets to improve total life cycle performance; managing the security of assets; measuring and managing any adverse effects of the organisation’s assets on the community and employees (including ergonomics, health and safety); utilising resources in an environmentally sound manner throughout the entire life cycle of a product; optimising material inventories; optimising consumption of utilities; reducing and recycling waste; minimising any adverse global impact of products, production processes and services.

4d Technology is managed This may include:

developing a strategy for managing technology that supports the organisation’s policy and strategy; Identifying and evaluating alternative and emerging technologies in the light of their impact on business and the society; managing the technology portfolio including the identification and replacement of out dated technology; exploiting existing technology;

Page No 25 of 61

Page No 26 of 61

developing innovative and environmentally friendly technology (i.e. conserving energy and resources, minimization of waste and emissions, encouraging recycling and re-use); using information and communication technologies to support and improve the effective operation of the organisation; using technology to support improvement.

4e Information and knowledge are managed This may include:

developing a strategy for managing information and knowledge that supports the organisation’s policy and strategy; identifying the organisation’s information and knowledge requirements; Collecting, structuring and managing information and knowledge in support of policy and strategy ; providing appropriate access, for both internal and external users, to relevant information and knowledge; using information technology to support internal communication and information and knowledge management; assuring and improving information validity, integrity and security; cultivating, developing and protecting unique intellectual property in order to maximise customer value; seeking to acquire, increase and use knowledge effectively; generating innovative and creative thinking within the organisation through the use of relevant information and knowledge resources.

Criterion 5 Processes

Definition Excellent organisations design, manage and improves processes in order to fully satisfy, and generate increasing value for, customers and other stakeholders. 5a Processes are systematically designed and

managed This may include:

designing the organisation’s processes, including those key processes needed to deliver policy and strategy; Identifying process stake holders and managing interface issues inside the organisation and with external partners for the effective management of end-to-end processes; establishing the process management system; applying systems standards covering for example, quality management systems, environmental systems, occupational health and safety systems in process management; implementing process indicators and setting performance targets; reviewing the effectiveness of the process framework in delivering the organisation’s policy and strategy.

5b Processes are improved, as needed, using innovation in order to fully satisfy and generate increasing value for customer and other stakeholders.

This may include:

Page No 27 of 61

identifying and prioritising opportunities for improvement, and other changes, both incremental and breakthrough; using performance and perception results and

information from learning activities to set priorities and targets for improvement and improved methods of operation; stimulating and bringing to bear the creative and innovative talents of employees, customers and partners in incremental and breakthrough improvements, . discovering and using new process designs, operating philosophies and enabling technology; establishing appropriate methods for implementing change; piloting and controlling the implementation of new or changed processes; communicating process changes to all appropriate stakeholders; ensuring people are trained to operate new or changed processes prior to implementation; ensuring process changes achieve predicted results.

5c Products and Services are designed and developed based on customer needs and expectations

This may include:

Page No 28 of 61

using market research, customer surveys and other forms of feedback to determine customer current needs and expectations for products and services; anticipating and identifying improvements aimed at enhancing products and services in line with customers’ and other stakeholders, future needs and expectations; designing and developing new products and services together with customers and partners that add value for the customers; understanding and anticipating the impact and potential of new technologies on products and services; developing new products and services for both the

current established market and to gain access to other markets; using creativity, innovation and key competencies of both internal people and external partners to design and develop competitive products and services;

5d Products and Services are produced, delivered and serviced

This may include: producing or acquiring products and services in line with designs and developments; marketing, communicating the value proposition, and selling products and services to existing and potential customers; delivering products and services to customers; servicing products and services, including recycling where appropriate.

5e Customer relationships are managed and enhanced

This may include: determining and meeting customers day to day contract requirements; handling feedback received from day to day contacts including complaints; proactive involvement with customers in order to discuss and address their needs, expectations and concerns; following up on sales, servicing and other contacts in order to determine levels of satisfaction with products, services and other customer sales and servicing processes; seeking to maintain creativity and innovation in the customer sales and servicing relationship; establishing partnerships with customers which add value to the supply chain; using regular surveys, other forms of structured data gathering and data gathered during day to day

Page No 29 of 61

customer contacts in order to determine and enhance customer relationship satisfaction levels; advising customers on the responsible use of products.

Criterion 6 Customer Results

Definition What excellent organisations comprehensively measure and achieve outstanding results with respect to their customers. 6a Perception Measures These measures are of the customers’ perceptions of the organisation (obtained, for example, from customer surveys, focus groups, vendor ratings, compliments and complaints). Depending on the purpose of the organisation, customer perception measures may include those relating to:

Image: accessibility; communication; transparency; flexibility; pro-active behaviour; responsiveness

Products and services:

quality: value; reliability; design innovation; delivery; environmental profile.

Page No 30 of 61

Sales and after sales support: capabilities and behaviour of employees;

Page No 31 of 61

advice and support; customer literature and technical documentation; handling complaints; product training; response time; technical support; warranty and guarantee provisions.

Loyalty:

intention to repurchase; willingness to produce other products and services from the organisation; willingness to recommend the organisation.

6b Performance Indicators These measures are the internal ones used by the organisation in order to monitor, understand, predict and improve the performance of the organisation and to predict perceptions of its external customers. Depending on the purpose of the organisation examples of measures that may be made include: Image:

number of customer accolades and nomination for awards; press coverage;

Products and services;

competitiveness; defect, error and rejection rates; Seals of approval, environmental labels; guarantee provisions and warranty provisions; complaints; logistic indicators; product life cycle; innovation in design; time to market.

Page No 32 of 61

Sales and after sales support demand for training; handling of complaints; response rates

Loyalty:

duration of relationship; effective recommendations; frequency/value of orders; lifetime value; numbers of complaints and compliments new and/or lost business; customer retention.

Criterion 7 People Results

Definition Excellent organisations comprehensively measure and achieve outstanding results with respect to their people 7a Perception Measures These measures are of the people’s perception of the organisation (obtained, for example, from surveys, focus groups, interviews, structured appraisals). Depending on the purpose of the organisation examples of measures that may be made include:

Motivation career development; communication; empowerment; equal opportunities; involvement; leadership; opportunity to learn and achieve; recognition; target setting and appraisal; the organisation’s values, mission, vision, policy and strategy;

Page No 33 of 61

training and development.

Satisfaction organisation’s administration; employment conditions; facilities and services; health and safety conditions; job security; pay and benefits; peer relationships; the management of change; the organisation’s environmental policy and impact; the organisation’s role in the community and society; working environment.

7b Performance Indicators These measures are the internal ones used by the organisation in order to monitor, understand, predict and improve the performance of the organisation’s people and to predict their perceptions. Depending on the purpose of the organisation examples of measures that may be made include:

Achievements: competency requirements versus competencies available; productivity; success rates of training and development to meet objectives. external awards and recognition.

Motivation and involvement:

involvement in improvement teams; involvement in suggestion schemes; levels of training and development; measurable benefits of team work; recognition of individuals and teams;

Page No 34 of 61

response rates to people surveys.

Satisfaction: absenteeism and sickness levels; accident levels; grievances; recruitment trends; staff turnover and loyalty; strikes; use of organisation provided facilities and benefits; services provided to the organisation’s people; accuracy of personnel administration; communication effectiveness; speed of response to enquiries; training evaluation.

Criterion 8

Society Results Definition Excellent organisations comprehensively measure and achieve outstanding results with respect to society. 8a Perception Measures These measures are of the society’s perception of the organisation (obtained, for example, from surveys, reports, press articles, public meetings, public representatives, governmental authorities). Some of the measures contained in the guidance for perception measures may be applicable to performance indicators and vice versa. Depending on the purpose of the organisation examples of measures that may be made include: Image:

responsiveness to contracts; as an employer;

Page No 35 of 61

as a responsible member of the community.

Performance as a responsible citizen: disclosures of information relevant to the community; equal opportunities practices; impact on local regional, national and global economies; relationships with relevant authorities; either behaviour.

Involvement in the communities where it operates:

involvement in education and training; involvement of community bodies in relevant activities; support for medical and welfare provision; support for sport and leisure; voluntary work and philanthropy.

Reduction and prevention of nuisance and harm fromits operations and/or throughout the lifecycle of itsproducts and services;

health risks and accidents; noise and odour hazards (safety) pollution and toxic emission. analysis of the supply chain; environmental performance evaluation/lifecycle evaluation.

Reporting on activities to assist in the preservation and sustainability of resources:

choice of transport; ecological impact; reduction and elimination of waste and packaging; substitution of raw materials or other inputs; usage of utilities e.g. gases, water, electricity; new

recycled materials. recycling.

8b Performance Indicators These measures are the internal ones used by the organisation in order to monitor, understand, predict and improve the performance of the organisation and to predict perceptions of society. Depending on the purpose of the organisation examples of measures that may be made include:

Handling changes in employment levels; Dealings with authorities on issues such as:

certification; clearances import/export planning; product release.

Accolades and awards received. Exchange of information in relation to social responsibility good practices, auditing and social reporting.

Criterion 9

Key Performance Results Definition Excellent organisations comprehensively measure and achieve outstanding results with respect to the key elements of their policy and strategy. 9a Key Performance Outcomes These measures are key results defined by the organisation and agreed in their policy and strategies. Depending on the purpose and objectives of the organisation some of the measures contained in the guidance for key performance outcomes may be applicable to key performance indicators and vice versa: Page No 36 of 61

Page No 37 of 61

Financial outcomes may include market related and general data (sales, share price, dividends etc.); profitability (gross margins, earnings per share, earnings before interest and tax, contribution margin etc.); investment and asset related information (return on invested capital, return on net assets, return on capital employed etc.); budgetary performance (performance against organisation or unit budgets).

Non-financial outcomes including:

market share; time to market; success rates; volumes; process performance

9b Key performance Indicators These measures are the operational ones used in order to monitor, understand the processes and predict and improve the organisation’s likely key performance outcomes. Depending on the progress and objectives of the organisations and its processes, they may include:

Financial

cash flow; depreciation; maintenance costs; project costs; credit ratings;

Non-Financial: processes (performance; assessments; innovations; cycle times); external resources including partnerships (supplier performance: supplier price; number and value

added of partnerships; number and value added of joint improvements with partners); Buildings, equipment and materials: (defect rates; inventory turnover; utilization); Technology: (innovation rate; value of intellectual property; patterns; royalties): Information and knowledge: (accessibility; integrity; value of intellectual capital): Number and value added of partnerships: Number and value added of innovative products and services solutions generated by partners.

CUSTOMER SATISFACTION

Customer satisfaction scores are leading indicators of organisational prosperity, often picking up problems before financial indicators can

Page No 38 of 61

Page No 39 of 61

There is a direct correlation between customer satisfaction and employee morale

Retraining a customer/ employee is a highly profitable strategy

CUSTOMER CATEGORY

Delighted customers

Dis-satisfied customers

Satisfied customers

Indifferent customers

Lost customers

Non customers

Page No 40 of 61

We have yet to acknowledge, it is People who will make the difference and their satisfaction is the key to Success. A Paradigm shift is needed to deal with Human Resource Management.

Page No 41 of 61

Page No 42 of 61

FUNCTION OF MANAGEMENT

Retainment ………. To maintain Quality level of already achieved

Improvement ….. Improve quality level more than that of achieved

Breakthrough ….. Innovation of Improvement

Page No 43 of 61

Page No 44 of 61

Page No 45 of 61

Page No 46 of 61

Page No 47 of 61

Page No 48 of 61

WHY IMPROVE AND MANAGE PROCESSES Root cause for Competitive advantage Vehicle for Strategy Implementation Enables Achievement of Customer needs Satisfaction and financial goals Enhances Performance of individuals (as good as processes allow it to be ) Frequently

Not documented Not Understood Not Managed Not Improved

CRITICAL PROCESSES * Make or Break the Business * Consume the most of the Business Resourcing * Deliver Fundamental Value to the Customer(s) ESCAPE: METHODS TO STREAMLINE PROCESS Eliminate - Eliminating the suspect steps Simplify - Simply the individual step Combine - Merge two or more steps into a single step Automate - Automation to make it faster, better and cheaper Parallel path - Execute two or more steps at the same time

Page No 49 of 61

GUIDELINES FOR STREAMLING PROCESS

1. Avoid documents

2. change sequence

3. Eliminate duplicate tasks

4. Justify each review/inspection

5. Reduce Rework

6. Reduce In-Process Inventory

7. Avoid Responsibility hand-offs

8. Build in Flexibility (Optional Paths)

9. Reduce the distance between people (customers, suppliers…) who must exchange information

10. Multi skilling (doing several steps)

Page No 50 of 61

Page No 51 of 61

IMPACT OF ORGANISATIONAL CHANGE

Design Type /

Characteristic

Incre-mental

Redesign Reengineering

Transfor- mation

Focus Tasks Critical Processes

Critical Processes

Processes + Systems

Action Solve Problems

Remove Complexity

Create New Process

Create New Organisation

Returns 1-10% 10-50% >50% ?

Success 95% 80% 30% ?

Who Service provider

Middle Management

Upper Management

Owner & Executive

Tools Statistics “Many”

Flow chart “Many”

Clean sheet of paper

Financial “Many”

Page No 52 of 61

BUSINESS EXCELLENCE AWARD CRITERIA

SCORE STATUS

700+

- Genuine World Class

- Excellent approaches leading to excellent results

600-700 - Amongst outstanding companies - Potential for World Class

500-600 - Doing the right things - Potential for becoming outstanding company

400-500 - Competently managed - Quality initiatives have taken roots - Leading to good results

300-400 - Many activities (Enablers) - Doing things right - Loose linkages with Results

-300 - Several quality initiatives started - Lacking focus on results

SUCCESS FACTORS FOR IMPROVEMENT

Shared vision Top management commitment and

involvement Focus Processes Empowerment Learn Patience

Page No 53 of 61

PROBLEMS AND HURDLES TO OVERCOME IN IMPROVEMENT ACTIVITIES

- Management commitment

- No quick fix

- Investment :

- Time,

- Money &

- Effort

- Benchmarking and deployment

- Being a role model

- Resistance to change

Page No 54 of 61

Page No 55 of 61

INDIVIDUAL LEADERSHIP SKILLS

BUSINESS LEADERSHIP SKILLS

EXECUTIVE LEADERSHIP SKILLS

Ability to choose what you want to do and maintain the focus, energy, discipline, and enthusiasm to consistently complete the required tasks

Making continual learning a personal Habit

Being proactive

Solving problems

Networking Working for

WIN-WIN Agreements.

Ability to choose the right avenue for business success

selecting the right business

creating a distinct competitive advantage (finding a Niche)

promoting and marketing

Making Business transitions

Ability to effectively support a whole organisation in fulfilling its mission and meeting its goals.

Defining and Articulating Meaningful purpose

Assembling the right people (and other resources)

Providing Direction, support and structure

Defining and Teaching roles

Managing the executive work processes

Page No 56 of 61

TEAM LEADERSHIP SKILLS

PROCESS LEADERSHIP SKILLS

PERFORMANCE LEADERSHIP SKILLS

Ability to help make those around you successfully contribute to the larger organisation or business

Chartering for success

Designing good meeting agendas

Resolving Issues

Removing Barriers

Communicating for improved Performance

Ability to design or find, and effectively use the best-known methods available to accomplish your work

Planning work

Controlling work

Improving work

Benchmarking best known methods

Re-engineering Business processes

Ability to become the best in a chosen area of performance (i.e., becoming and sustaining world class status)

understanding and satisfying customer needs

measuring results

Reviewing and analysing performance

Verifying status with comparative data

Identifying improvement opportunities.

Page No 57 of 61

Page No 58 of 61

Page No 59 of 61

A TRUE STORY OF TOM IMPLEMENTATION There is a story about four people named Everybody, somebody, anybody and Nobody They have identified an important improvement project to be done. Everybody was sure that somebody would do it. Anybody could have done it, but nobody did it. Somebody got angry because it was everybody’s job. Everybody thought that anybody could do it, But nobody realised that everybody would not do it. It ended up that everybody blamed somebody, when actually nobody accused anybody. Everybody should be always dependent on somebody to see that nobody takes anybody for granted.

MORAL OF THIS STORY Total Quality Management is everybody’s job.

Page No 60 of 61