HANDOUTS BY TOTAL QUALITY MANAGEMENT

Dexter Ermin P. Duma, MPRM

Total Quality Management - Meaning and Important Concepts
To understand the meaning of Total quality management, let us first know what does Quality
mean?
Total Quality Management is a management approach that originated in the 1950s and has
steadily become more popular since the early 1980s. Total Quality is a description of the culture,
attitude and organization of a company that strives to provide customers with products and
services that satisfy their needs. The culture requires quality in all aspects of the companys
operations, with processes being done right the first time and defects and waste eradicated from
operations.
Total Quality Management, TQM, is a method by which management and employees can become
involved in the continuous improvement of the production of goods and services. It is a
combination of quality and management tools aimed at increasing business and reducing losses
due to wasteful practices.
Some of the companies who have implemented TQM include Ford Motor Company, Phillips
Semiconductor, SGL Carbon, Motorola and Toyota Motor Company.1

TQM Defined
TQM is a management philosophy that seeks to integrate all organizational functions (marketing,
finance, design, engineering, and production, customer service, etc.) to focus on meeting
customer needs and organizational objectives.
TQM views an organization as a collection of processes. It maintains that organizations must
strive to continuously improve these processes by incorporating the knowledge and experiences of
workers. The simple objective of TQM is Do the right things, right the first time, every time.
TQM is infinitely variable and adaptable. Although originally applied to manufacturing operations,
and for a number of years only used in that area, TQM is now becoming recognized as a generic
management tool, just as applicable in service and public sector organizations. There are a
number of evolutionary strands, with different sectors creating their own versions from the
common ancestor. TQM is the foundation for activities, which include:

Commitment by senior management and all employees

Meeting customer requirements
Reducing development cycle times
Just in time/demand flow manufacturing
Improvement teams
Reducing product and service costs
Systems to facilitate improvement
Line management ownership
Employee involvement and empowerment
Recognition and celebration
Challenging quantified goals and benchmarking
Focus on processes / improvement plans
Specific incorporation in strategic planning

Principles of TQM
The key principles of TQM are as following:3
Management Commitment

Plan (drive, direct)

Do (deploy, support, participate)
Check (review)
Act (recognize, communicate, revise)
Employee Empowerment

Training
Suggestion scheme
Measurement and recognition
Excellence teams
Fact Based Decision Making

SPC (statistical process control)

DOE, FMEA
The 7 statistical tools
TOPS (Ford 8D team-oriented problem solving)
Continuous Improvement

Systematic measurement and focus on CONQ

Excellence teams
Cross-functional process management
Attain, maintain, improve standards
Customer Focus

Supplier partnership
Service relationship with internal customers
Never compromise quality
Customer driven standards
The Concept of Continuous Improvement by TQM
TQM is mainly concerned with continuous improvement in all work, from high level strategic
planning and decision-making, to detailed execution of work elements on the shop floor. It stems
from the belief that mistakes can be avoided and defects can be prevented. It leads to
continuously improving results, in all aspects of work, as a result of continuously improving
capabilities, people, processes, technology and machine capabilities.
Continuous improvement must deal not only with improving results, but more importantly with
improving capabilities to produce better results in the future. The five major areas of focus for
capability improvement are demand generation, supply generation, technology, operations and
people capability.
A central principle of TQM is that mistakes may be made by people, but most of them are caused,
or at least permitted, by faulty systems and processes. This means that the root cause of such
mistakes can be identified and eliminated, and repetition can be prevented by changing the
process.1
There are three major mechanisms of prevention:

1.
2.

Preventing mistakes (defects) from occurring (mistake-proofing or poka-yoke).

Where mistakes cant be absolutely prevented, detecting them early to prevent them being
passed down the value-added chain (inspection at source or by the next operation).
3.
Where mistakes recur, stopping production until the process can be corrected, to prevent
the production of more defects. (stop in time).

Quality refers to a parameter which decides the superiority or inferiority of a product or

service. Quality can be defined as an attribute which differentiates a product or service from its

competitors. Quality plays an essential role in every business. Business marketers need to
emphasize on quality of their brands over quantity to survive the cut throat competition.
Why would a customer come to you if your competitor is also offering the same product? The
difference has to be there in quality. Your brand needs to be superior for it to stand apart from the
rest.
Total Quality Management
Total Quality management is defined as a continuous effort by the management as well
as employees of a particular organization to ensure long term customer loyalty and
customer satisfaction. Remember, one happy and satisfied customer brings ten new customers
along with him whereas one disappointed individual will spread bad word of mouth and spoil
several of your existing as well as potential customers.
You need to give something extra to your customers to expect loyalty in return. Quality can be
measured in terms of durability, reliability, usage and so on. Total quality management is a
structured effort by employees to continuously improve the quality of their products and services
through proper feedbacks and research. Ensuring superior quality of a product or service is not
the responsibility of a single member.
Every individual who receives his/her paycheck from the organization has to contribute equally to
design foolproof processes and systems which would eventually ensure superior quality of
products and services. Total Quality management is indeed a joint effort of management, staff
members, workforce, suppliers in order to meet and exceed customer satisfaction level. You cant
just blame one person for not adhering to quality measures. The responsibility lies on the
shoulder of everyone who is even remotely associated with the organization.
W. Edwards Deming, Joseph M. Juran, and Armand V. Feigenbaum jointly developed the concept
of total quality management. Total Quality management originated in the manufacturing sector,
but can be applied to almost all organizations.
Total quality management ensures that every single employee is working towards the
improvement of work culture, processes, services, systems and so on to ensure long
term success.
Total Quality management can be divided into four categories:

Plan

Do

Check

Act

Also referred to as PDCA cycle.

Planning Phase
Planning is the most crucial phase of total quality management. In this phase employees have to
come up with their problems and queries which need to be addressed. They need to come up with
the various challenges they face in their day to day operations and also analyze the problems
root cause. Employees are required to do necessary research and collect relevant data which
would help them find solutions to all the problems.
Doing Phase
In the doing phase, employees develop a solution for the problems defined in planning phase.
Strategies are devised and implemented to overcome the challenges faced by employees. The
effectiveness of solutions and strategies is also measured in this stage.

Checking Phase
Checking phase is the stage where people actually do a comparison analysis of before and after
data to confirm the effectiveness of the processes and measure the results.
Acting Phase
In this phase employees document their results and prepare themselves to address other
problems.
Importance of Quality Management
Quality management ensures superior quality products and services. Quality of a
product can be measured in terms of performance, reliability and durability. Quality is a crucial
parameter which differentiates an organization from its competitors. Quality management tools
ensure changes in the systems and processes which eventually result in superior quality products
and services. Quality management methods such as Total Quality management or Six Sigma have
a common goal - to deliver a high quality product. Quality management is essential to create
superior quality products which not only meet but also exceed customer satisfaction. Customers
need to be satisfied with your brand. Business marketers are successful only when they
emphasize on quality rather than quantity. Quality products ensure that you survive the cut throat
competition with a smile.
Quality management is essential for customer satisfaction which eventually leads to
customer loyalty. How do you think businesses run? Do businesses thrive only on new
customers? It is important for every business to have some loyal customers. You need to have
some customers who would come back to your organization no matter what.
Would you buy a Nokia mobile again if the previous handset was defective? The answer is NO.
Customers would return to your organization only if they are satisfied with your products and
services. Make sure the end-user is happy with your product. Remember, a customer would be
happy and satisfied only when your product meets his expectations and fulfills his needs.
Understand what the customer expects from you? Find out what actually his need is? Collect
relevant data which would give you more insight into customers needs and demands. Customer
feedbacks should be collected on a regular basis and carefully monitored. Quality management
ensures high quality products and services by eliminating defects and incorporating continuous
changes and improvements in the system. High quality products in turn lead to loyal and satisfied
customers who bring ten new customers along with them. Do not forget that you might save
some money by ignoring quality management processes but ultimately lose out on your major
customers, thus incurring huge losses. Quality management ensures that you deliver products as
per promises made to the customers through various modes of promotions.
Quality management tools help an organization to design and create a product which
the customer actually wants and desires.
Quality Management ensures increased revenues and higher productivity for the
organization. Remember, if an organization is earning, employees are also earning. Employees
are frustrated only when their salaries or other payments are not released on time. Yes, money is
a strong motivating factor. Would you feel like working if your organization does not give you
salary on time? Ask yourself. Salaries are released on time only when there is free cash flow.
Implementing Quality management tools ensure high customer loyalty, thus better business,
increased cash flow, satisfied employees, healthy workplace and so on. Quality management
processes make the organization a better place to work.
Remove unnecessary processes which merely waste employees time and do not contribute much
to the organizations productivity. Quality management enables employees to deliver more work
in less time.
Quality management helps organizations to reduce waste and inventory. It enables
employees to work closely with suppliers and incorporate Just in Time Philosophy.
Quality management ensures close coordination between employees of an organization. It
inculcates a strong feeling of team work in the employees.
Total Quality Management Models

Total Quality Management is a combined effort of both top level management as well as
employees of an organization to formulate effective strategies and policies to deliver high quality
products which not only meet but also exceed customer satisfaction.
Total Quality management enables employees to focus on quality than quantity and strive hard to
excel in whatever they do. According to total quality management, customer feedbacks and
expectations are most essential when it comes to formulating and implementing new strategies to
deliver superior products than competitors and eventually yield higher revenues and profits for
the organization.
Credits for the process of total quality management go to many philosophers and their teachings.
Drucker, Juran, Deming, Ishikawa, Crosby, Feigenbaum and many other individuals who have in
due course of time studied organizational management have contributed effectively to the process
of total quality management.
There are many models of total quality management and it is really not necessary that every
organization should select and implement the same model.
Following are the various models of total quality management:

Deming Application Prize

Malcolm Baldrige Criteria for Performance Excellence

European Foundation for Quality Management, and

ISO quality management standards

Customers and their feedbacks are the foundation of every Total Quality Management model. In
simpler words, Total Quality Management begins with understanding customers, their needs and
what they expect from the organization. Design foolproof processes and systems to collect
customer data, information to further study, analyze and act accordingly. Such activities not only
help you understand your target customers but also predict customer behaviour.
As a business marketer, you need to know the age group of your target customers, their
preferences and needs. Employees need to know how their products or services can fulfil
customer needs and demands.
Total Quality Management model requires meticulous planning and research. Every total quality
management model integrates customer feedbacks with relevant information and plans
accordingly to design effective strategies to achieve high quality products.
Strategies formulated to yield better quality products need to be evaluated and reviewed from
time to time. Remember, customers are satisfied only when products meet their expectations,
fulfil their needs and are value for money. Their overall experience with the organization needs to
be pleasant for them to be happy and return to the organization even the next time.
Continuous improvements, changes and modifications in the existing processes according to
customer expectations are necessary to yield higher profits. Processes cant be same always. If a
customer complaints about a particular product of yours, find out the root cause of problem.
Understand and implement necessary total quality management models to rectify the problem,
remove the defect for a high quality product.
The successful implementation of Total quality Management model needs extensive
planning and most importantly participation of every single member who is benefitted
out of the organization(Management, suppliers, clients and even customers). Without
the participation of each and every employee, total quality management model would be a
complete failure.
Total Quality Management model begins with research and collecting information about end-users
followed by planning and full participation of employees for successful implementation. Top level
Management needs to make other team members aware of the benefits of total quality
management process, importance of quality to survive in the long run and how they can
implement various TQM models by prioritizing their customers and their feedbacks.
Quality Management Tools

Quality Management tools help organization collect and analyze data for employees to easily
understand and interpret information. Quality Management models require extensive planning and
collecting relevant information about end-users. Customer feedbacks and expectations need to be
carefully monitored and evaluated to deliver superior quality products.
Quality Management tools help employees identify the common problems which are
occurring repeatedly and also their root causes. Quality Management tools play a crucial role
in improving the quality of products and services. With the help of Quality Management tools
employees can easily collect the data as well as organize the collected data which would further
help in analyzing the same and eventually come to concrete solutions for better quality products.
Quality Management tools make the data easy to understand and enable employees to identify
processes to rectify defects and find solutions to specific problems.
Following are the quality management tools:

Check List - Check lists are useful in collecting data and information easily .Check list also
helps employees to identify problems which prevent an organization to deliver quality
products which would meet and exceed customer expectations. Check lists are nothing but
a long list of identified problems which need to be addressed. Once you find a solution to a
particular problem, tick it immediately. Employees refer to check list to understand
whether the changes incorporated in the system have brought permanent improvement in
the organization or not?

Pareto Chart - The credit for Pareto Chart goes to Italian Economist - Wilfredo Pareto.
Pareto Chart helps employees to identify the problems, prioritize them and also determine
their frequency in the system. Pareto Chart often represented by both bars and a line
graph identifies the most common causes of problems and the most frequently occurring
defects. Pareto Chart records the reasons which lead to maximum customer complaints
and eventually enables employees to formulate relevant strategies to rectify the most
common defects.

The Cause and Effect Diagram - Also referred to as Fishbone Chart (because of its
shape which resembles the side view of a fish skeleton)and Ishikawa diagrams after its
creator Kaoru Ishikawa, Cause and Effect Diagram records causes of a particular and
specific problem .The cause and effect diagram plays a crucial role in identifying the root
cause of a particular problem and also potential factors which give rise to a common
problem at the workplace.

Histogram - Histogram, introduced by Karl Pearson is nothing but a graphical

representation showing intensity of a particular problem. Histogram helps identify the
cause of problems in the system by the shape as well as width of the distribution.

Scatter Diagram - Scatter Diagram is a quality management tool which helps to analyze
relationship between two variables. In a scatter chart, data is represented as points, where
each point denotes a value on the horizontal axis and vertical axis.
Scatter Diagram shows many points which show a relation between two variables.

Graphs - Graphs are the simplest and most commonly used quality management tools.
Graphs help to identify whether processes and systems are as per the expected level or
not and if not also record the level of deviation from the standard specifications.

Six Sigma and Quality Management

Six Sigma is a business management strategy which aims at improving the quality of processes
by minimizing and eventually removing the errors and variations. The concept of Six Sigma was
introduced by Motorola in 1986, but was popularized by Jack Welch who incorporated the strategy
in his business processes at General Electric. The concept of Six Sigma came into existence when
one of Motorolas senior executives complained of Motorolas bad quality. Bill Smith eventually
formulated the methodology in 1986.
Quality plays an important role in the success and failure of an organization. Neglecting an
important aspect like quality, will not let you survive in the long run. Six Sigma ensures

superior quality of products by removing the defects in the processes and systems. Six
sigma is a process which helps in improving the overall processes and systems by identifying and
eventually removing the hurdles which might stop the organization to reach the levels of
perfection. According to sigma, any sort of challenge which comes across in an organizations
processes is considered to be a defect and needs to be eliminated.
Organizations practicing Six Sigma create special levels for employees within the organization.
Such levels are called as: Green belts, Black belts and so on. Individuals certified with any of
these belts are often experts in six sigma process. According to Six Sigma any process which
does not lead to customer satisfaction is referred to as a defect and has to be
eliminated from the system to ensure superior quality of products and services. Every
organization strives hard to maintain excellent quality of its brand and the process of six sigma
ensures the same by removing various defects and errors which come in the way of customer
satisfaction.
The process of Six Sigma originated in manufacturing processes but now it finds its use in other
businesses as well. Proper budgets and resources need to be allocated for the implementation of
Six Sigma in organizations.
Following are the two Six Sigma methods:

DMAIC

DMADV

DMAIC focuses on improving existing business practices. DMADV, on the other hand focuses on
creating new strategies and policies.
DMAIC has Five Phases
D - Define the Problem. In the first phase, various problems which need to be addressed to are
clearly defined. Feedbacks are taken from customers as to what they feel about a particular
product or service. Feedbacks are carefully monitored to understand problem areas and their root
causes.
M - Measure and find out the key points of the current process. Once the problem is
identified, employees collect relevant data which would give an insight into current processes.
A - Analyze the data. The information collected in the second stage is thoroughly verified. The
root cause of the defects are carefully studied and investigated as to find out how they are
affecting the entire process.
I - Improve the current processes based on the research and analysis done in the previous
stage. Efforts are made to create new projects which would ensure superior quality.
C - Control the processes so that they do not lead to defects.
DMADV Method
D - Design strategies and processes which ensure hundred percent customer satisfaction.
M - Measure and identify parameters that are important for quality.
A - Analyze and develop high level alternatives to ensure superior quality.
D - Design details and processes.
V - Verify various processes and finally implement the same.
What is Kaizen ? - Five S of Kaizen

Kaizen refers to a Japanese word which means improvement or change for the
better. Kaizen is defined as a continuous effort by each and every employee (from the
CEO to field staff) to ensure improvement of all processes and systems of a particular
organization. Work for a Japanese company and you would soon realize how much importance
they give to the process of Kaizen. The process of Kaizen helps Japanese companies to outshine
all other competitors by adhering to certain set policies and rules to eliminate defects and ensure
long term superior quality and eventually customer satisfaction.
Kaizen works on the following basic principle.
Change is for good.
Kaizen means continuous improvement of processes and functions of an organization
through change. In a laymans language, Kaizen brings continuous small improvements in the
overall processes and eventually aims towards organizations success. Japanese feel that many
small continuous changes in the systems and policies bring effective results than few major
changes.
Kaizen process aims at continuous improvement of processes not only in manufacturing
sector but all other departments as well. Implementing Kaizen tools is not the responsibility
of a single individual but involves every member who is directly associated with the organization.
Every individual, irrespective of his/her designation or level in the hierarchy needs to contribute
by incorporating small improvements and changes in the system.

Following are the main elements of Six Sigma:

Teamwork

Personal Discipline

Improved Morale

Quality Circles

Suggestions for Improvement

Five S of Kaizen
Five S of Kaizen is a systematic approach which leads to foolproof systems, standard policies,
rules and regulations to give rise to a healthy work culture at the organization. You would hardly
find an individual representing a Japanese company unhappy or dissatisfied. Japanese employees
never speak ill about their organization. Yes, the process of Kaizen plays an important role in
employee satisfaction and customer satisfaction through small continuous changes and
eliminating defects. Kaizen tools give rise to a well organized workplace which results in better
productivity and yield better results. It also leads to employees who strongly feel attached
towards the organization.
Let us understand the five S in Detail:
1. SEIRI - SEIRI stands for Sort Out. According to Seiri, employees should sort out and
organize things well. Label the items as Necessary, Critical, Most Important, Not
needed now, Useless and so on. Throw what all is useless. Keep aside what all is not

needed at the moment. Items which are critical and most important should be kept at a
safe place.
2. SEITION - Seition means to Organize. Research says that employees waste half of their
precious time searching for items and important documents. Every item should have its
own space and must be kept at its place only.
3. SEISO - The word SEISO means shine the workplace. The workplace ought to be kept
clean. De-clutter your workstation. Necessary documents should be kept in proper folders
and files. Use cabinets and drawers to store your items.
4. SEIKETSU-SEIKETSU refers to Standardization. Every organization needs to have certain
standard rules and set policies to ensure superior quality.
5. SHITSUKE or Self Discipline - Employees need to respect organizations policies and
adhere to rules and regulations. Self discipline is essential. Do not attend office in casuals.
Follow work procedures and do not forget to carry your identity cards to work. It gives you
a sense of pride and respect for the organization.
Kaizen focuses on continuous small improvements and thus gives immediate results.
Role of Managers in Total Quality Management
Total Quality Management is defined as a continuous effort by management to upgrade and
improve the processes and systems to ensure superior quality products. Every organization has to
take care of its customers. Their feedbacks are essential. Total Quality management creates
processes and systems based on customer feedbacks and various researches which eventually
help in the development of organization.
Managers play an important role in Total Quality Management:
Initiating and implementing total quality management programs require great amount of planning
and research. Managers need to get trained in various TQM practices before implementing the
same. There are costs involved with the entire process of total quality management. It is the
managers responsibility to allocate budgets for TQM at the beginning of every financial year.
Remember, you cant crib later on. Read a lot about total Quality management.
You need to be convinced first why quality is such an important parameter in every business. If
you yourself are not convinced, it would be very difficult for you to convince other departments
for implementing TQM. Know who your customers are? Understand your target market carefully.
Go out, meet customers and find out as to what all they expect from your brand. Customer
feedbacks play an important role in formulating strategies for total quality management. As a
manager; you need to work closely with the senior management, human resource professionals
to develop foolproof implementation strategies. Remember, a manager has to act as a bridge
between the senior management and the entire workforce.
The role of a manager is to act as a facilitator at the workplace. It is your duty to assist
employees in implementing TQM. As a manager, it is your responsibility to select and appoint
right individuals who can work as line managers and take charge of the entire project. The
employees, you select ought to be reliable and diligent and should be capable enough to handle a
crucial project like total quality management. It is the managers responsibility to assign
resources for total quality management, allocate time for various training programs and
appreciate employees who come up with various improvement ideas and strategies which would
help the organization deliver superior quality products. Further train your subordinates to ensure
smooth implementation of TQM without any obstacles.
A manager must communicate the benefits of total quality management to all other
members of the organization. Call employees on a common platform and address the benefits
and importance of total quality management. Make them understand how successful
implementation of total quality management programs would yield high quality products which
would not only benefit the organization but also the employees associated with the same. Why do
we always think of outsourcing trainers? Why cant we train employees on our own? Believe me,
as a manager if you train your employees, the results would be better rather than an unknown
face coming and loading them with information. Do not forget, a trainer needs to be prepared for
every question. Do your homework carefully.

Remember, a manager is always a strong source of inspiration for other employees. You need to
practice total quality management yourself before expecting others to believe in the same.
Customer feedbacks should be carefully monitored and taken into consideration while formulating
companys major strategies. Provide frequent reports to staff members highlighting scope of
improvement.
Role of Customers in Total Quality Management
Total Quality management refers to a continuous effort of management along with the employees
of a particular organization to improve the quality of products and services. Businesses need to
emphasize on quality of their products rather than quantity to survive the fierce competition.
Remember in todays scenario, there is no dearth of competitors in the market. Why would a
customer return to your organization if you do not deliver what you had promised him initially?
You can fool someone once but not twice. Quality is an important parameter for every business
and should not be ignored at any cost.
Total Quality management works on a very simple principle:
The responsibility of delivering quality products and services to customers lies on the shoulders of
every single individual who is even remotely associated with the organization. It is not only the
management but also employees irrespective of their designation, suppliers, clients, customers
who need to come up with improvement ideas to make foolproof systems and processes to deliver
quality products which meet and exceed the expectations of end- users.
Customers play an important role in total quality management.
Before we proceed further, let me ask you a very simple question.
What is the basic difference between a successful and an unsuccessful business?
A business is successful only when its products and services have enough buyers in the market.
Yes there are several other parameters also but customers play a crucial role in deciding the
success and failure of an organization. Business marketers need to focus on their end-users and
what exactly they expect from their organization. Customer feedbacks should be regularly
and carefully monitored before formulating any major business strategy. How can you
ignore your customers who pay for your products which eventually bring revenues to your
organization and yield higher profits?
Understand the needs and demands of the customers
Total quality management ensures that employees understand their target customers
well before making any changes in the processes and systems to deliver superior quality
products for better customer satisfaction. Infact, organizations introduce total quality
management or any other quality management process to increase their customer base and
levels of customer satisfaction. Total Quality management increases an organizations database of
loyal customers who would not go anywhere, no matter what. Believe me, without customers a
business cant even exist.
Quality of a product is not defined only in terms of its durability, packaging, reliability, timely
delivery and so on but also a customers overall experience with the organization. Remember
customer dissatisfaction leads to loss of business. In service industry, employees need to interact
with the customers sensibly and with utmost care and professionalism to expect happy and loyal
customers. Design various feedback forms for the customers for them to share what they feel
about your products and services. The feedbacks may be in favour of your organization, may not
be in favour of your business. Negative comments or feedbacks of the customers should not be
ignored. As a part of total quality management, employees should sit on a common platform,
brainstorm ideas and come to concrete solutions which would improve the systems and processes
to eventually delivery what the customer expects. No amount of total quality management would
help if you ignore your customers.
In case of physical products, customers are satisfied when the products are:

10

Durable

Reliable

Easy to Use

Adaptable

Appropriate

In case of service industry customers are satisfied only when:

Employees are friendly and polite

Employees are honest and do not make fake promises

Employees are easy approachable

Employees are willing to listen and address customer grievances

Organizations respond to customer requests on time.

Comparison of Six Sigma and Total Quality Management

Both Six Sigma and Total Quality Management are effective tools for quality management but a
thin line of difference does exist between them. Although the methodologies and procedures
involved in both the two appear quite similar but there are certain major differences.
Six-Sigma is a relatively newer concept than Total Quality Management but not exactly
its replacement. The basic difference between Total Quality Management and Six Sigma is that
TQM delivers superior quality manufactured goods whereas six sigma on the other hand results in
better results. Total Quality management refers to continuous effort by employees to ensure high
quality products. The process of Six Sigma incorporates many small changes in the systems to
ensure effective results and better customer satisfaction.
Total Quality Management involves designing and developing new systems and processes and
ensures effective coordination among various departments. New Processes are developed based
on various customer feedbacks and researches.
The main focus of Total quality management is to maintain existing quality standards
whereas Six Sigma primarily focuses on making small necessary changes in the
processes and systems to ensure high quality.
The process of Total quality management does reach to a saturation level after a certain period of
time. After reaching the saturation stage, no further improvements in quality can be made. Six
Sigma on the other hand seldom reaches the saturation stage by initiating a next level quality
process.
The process of Total quality management involves improvement in existing policies and
procedures to ensure high quality. Six-Sigma focuses on improving quality by minimizing
and eventually eliminating defects from the system. The process of total Quality
management ensures that every single member associated with the organization is working
towards the improvement of existing processes, systems, services and work culture for long term
quality products/services. Six Sigma, on the other hand focuses on first identifying and eventually
removing various defects and obstacles which might come in the way of organizations success. In
a laymans language total quality management emphasizes on improving the existing policies and
making necessary changes in the systems to ensure superior quality products and services.
Organizations practicing Six Sigma are focused on removing errors and defects to ensure high
quality products.
Total Quality management is a less complicated process than Six Sigma. Six-Sigma
involves specially trained individuals whereas total quality management does not require
extensive training. The process of Six Sigma creates special levels for employees who are only
eligible to implement the same. Employees trained for Six Sigma are often certified as Green

11

Belts or Black Belts depending on their level of proficiency. Six-Sigma requires participation of
only certified professionals whereas total quality management can be referred to a part time
activity which does not require any special training. Six-Sigma can be implemented by dedicated
and well trained professionals.
Six-Sigma is known to deliver better and effective results as compared to total quality
management. The process of Six Sigma is based on customer feedbacks and is more accurate
and result oriented. Customer feedbacks play an important role in Six Sigma. Experts predict that
six sigma will outshine total quality management in due course of time.
Similarities and Differences in Implementation of Quality Frameworks in Manufacturing and
Service Sector
Introduction
A production defect in a company like GE (General Electric) might result in that specific product or
the part being removed from the assembly line and not sent out as finished product.
However, in the service sector, a process error might prove to be costly as in the case of the JPMC
or Citigroup (banking or financial services company that have adopted Six Sigma) where the
leverage for each transaction is more and hence an error in a process can be magnified several
times.
A literature review of the differences between adopting Six Sigma for manufacturing and services
yields the finding that there are four things to consider before service organizations adopt Six
Sigma as a way of life in their organizations.
Key Similarities and Differences between Manufacturing and Service Sectors
1. First, managers in the service sector must realize that unlike in the manufacturing sector,
there are a number of processes in the banking and financial services companies (service
sector) that are of varying complexity and different levels of customization. For instance,
an assembly line in a manufacturing industry is an example of a highly standard process
that can adopt a quality framework.
However, in the banking sector, there are some processes that are highly complex and do
not lend themselves to standardization in the same way that a process in the
manufacturing sector does. Hence, the challenge for the service sector is to consider which
process can be mass-customized meaning that the process is the same for all customers
and in all conditions and then apply the quality frameworks to achieve process excellence.
An example of a mass customized process in the banking industry or for that matter any
service sector company would be the payroll and the credit card accounting processes that
lend themselves to standardization. Similarly, in a fast food chain, the processes lend
themselves to a high degree of standardization and hence these can selected for
application of the quality frameworks.
2. The second point to be considered is one of the cardinal principles of quality control: To
define what is a defect and how is one going to measure it? In manufacturing
industries it is often easier to spot defects as visual inspection or even advanced quality
control processes can often spot defects as they relate to the quality of the product
manufactured.
However, in service companies, defining a defect is a challenge as the conflict between
quality as demanded by the customer and the quality of the service as offered by the
service provider are two different things. Owing to the perceptual nature of arriving at an
understanding of what a defect is, it is often helpful to define the defects in terms of
customers lost, customer satisfaction ratings and service turnaround times.
What these three parameters mean is that the concept of quality in the service sector is
often dictated by the customer. Hence, efforts must be made to understand the customer
point of view by using skilled researchers and service representatives to implement a

12

feedback loop that feeds into the system prevalent in the service industry and self
corrects (in the ideal case) or is prodded to do so.
3. The third point relates to the way in which quality slippages are analyzed within the service
sector company. Continuing the same point made in the preceding paragraph, it is
important to find out the root cause behind the defect or the deficiency in service and
then act accordingly. It might be the case that complex processes with numerous rules
governing each step of the process (that is the hallmark of banking and financial service
companies) might need to be analyzed minutely for possible root causes for the defect.
Leadership Practices
The leadership and management practices that have been found to have contributed to the
successful implementation of the quality frameworks would be analyzed in this section. As the
case study pertaining to the Dow Chemical implementation of Six Sigma framework shows, there
needs to be sustained focus on the goals and objectives that have been set for the Six Sigma
implementation.
The analysis of the Case Study of Dow Chemical shows how the leadership implemented a
Staircase of Change Leadership model that has the ten attributes progressing from each step
starting with the enunciation of vision and culminating in the success step of the staircase that
represents the pinnacle of achievement for Dow.
Case Study of Dow Chemical
The Dow Staircase of Change Leadership consists of the following steps: Vision, Values, Attitude,
Language, Behaviours, Best Practices, Articulated Strategy, Implementation, Culture Change and
Success. The emphasis at each step of the model is to have a coherent strategy to implement Six
Sigma and ensure that it is driven from the top as well as embraced by the bottom.
In short a combination of top driven and bottom-up strategies that enunciate a clear vision to be
the leader in achieving Six Sigma compliance is the focus of the model as followed by Dow
Chemicals.
The key points about this model are the emphasis on terminology that is unique to the
framework and its implementation (the language step), the necessary behaviours that are
needed to be followed by each employee and which were communicated as part of road shows
and the adoption of best practices from across the industry and customizing them to the specific
case of Dow Chemicals.
Case Study of Doosan Company
The other case study that is being analyzed for Leadership practices is the one that has been
followed by the Doosan Company in South Korea. Under the six-sigma framework adopted by
Doosan, there are five elements in the model that are aligned with each other in pursuit of the
objective of quality excellence.
The five elements that Doosan incorporates in its model are
1. top-level management commitment,
2. stakeholder involvement,
3. training schemes,
4. project team activities, and
5. measurement system
An analysis of the elements reveals the fact that each of them cannot function without the
cooperation and collaboration of the other and a coordinated and synchronous approach towards
pursuing the Six Sigma framework is what gives Doosan the edge over its competitors.

13

Elements of Total Quality Management

Quality is an essential parameter which helps organizations outshine their competitors and survive
the fierce competition.
The success of total quality management depends on following eight elements which are further
classified into following four groups.

Foundation

Building Bricks

Binding Mortar

Roof

Foundation
Foundation further includes Ethics, Integrity and Trust
The entire process of Total Quality Management is built on a strong foundation of Ethics, Integrity
and Trust. Total Quality Management involves every single employee irrespective of his
designation and level in the hierarchy.
Ethics: Ethics is an individuals understanding of what is good and bad at the workplace. A thin
line of difference does exist between good and bad, which is for you to decide. Ethics teach an
individual to follow code of conduct of organization and adhere to rules and regulations.
Integrity: Integrity refers to honesty, values and an individuals sincerity at workplace. You need
to respect your organizations policies. Avoid spreading unnecessary rumours about your fellow
workers. Total Quality Management does not work in an environment where employees criticize
and backstab each other.
Trust: Trust is one of the most important factors necessary for implementation of total quality
management. Employees need to trust each other to ensure participation of each and every
individual. Trust improves relationship among employees and eventually helps in better decision
making which further helps in implementing total quality management successfully.
Bricks
Bricks are placed on a strong foundation to reach the roof of recognition. The foundation needs to
be strong enough to hold the bricks and support the roof.
Training: Employees need to be trained on Total Quality Management. Managers need to make
their fellow workers aware of the benefits of total quality management and how would it make a
difference in their product quality and eventually yield profits for their organization. Employees
need to be trained on interpersonal skills, the ability to work as a team member, technical knowhow, decision making skills, problem solving skills and so on. Training enables employees to
implement TQM effectively within their departments and also make them indispensable resources.
Teamwork: Team work is a crucial element of total quality management. Rather than working
individually, employees need to work in teams. When individuals work in unison, they are in a
position to brainstorm ideas and come up with various solutions which would improve existing
processes and systems. Team members ought to help each other to find a solution and put into
place.
Leadership: Leadership provides a direction to the entire process of Total Quality Management.
Total Quality Management needs to have a supervisor who acts as a strong source of inspiration
for other members and can assist them in decision making. A leader himself needs to believe in
the entire process of TQM for others to believe in the same. Proper downloads, briefs about TQM
must be given from to time to employees to help them in its successful implementation.

14

Binding Mortar
Binding Mortar binds all the elements together.
Communication - Communication binds employees and extracts the best out of them.
Information needs to be passed on from the sender to the recipient in its desired form. Small
misunderstandings in the beginning lead to major problems later on. Employees need to interact
with each other to come up with problems existing in the system and find their solutions as well.
Three types of Communication takes place between employees:
Downward Communication: Flow of information takes place from the management to the
employees
Upward Communication: Flow of information takes place from the employees to the top level
management
Sideways Communication: Communication also takes place between various departments.
Roof
Recognition: Recognition is the final element of Total Quality Management. Recognition is the
most important factor which acts as a catalyst and drives employees to work hard as a team and
deliver their lever best. Every individual is hungry for appreciation and recognition. Employees
who come up with improvement ideas and perform exceptionally well must be appreciated in front
of all. They should be suitably rewarded to expect a brilliant performance from them even the
next time.
Generic Strategy Model for Implementing TQM Systems
1. Top management learns about and decides to commit to TQM. TQM is identified as one of
the organizations strategies.
2. The organization assesses
management systems.

current

culture,

customer

satisfaction,

and

quality

3. Top management identifies core values and principles to be used, and communicates
them.
4. A TQM master plan is developed on the basis of steps 1, 2, and 3.
5. The organization identifies and prioritizes customer demands and aligns products and
services to meet those demands.
6. Management maps the critical processes through which the organization meets its
customers needs.
7. Management oversees the formation of teams for process improvement efforts.
8. The momentum of the TQM effort is managed by the steering committee.
9. Managers contribute individually to the effort through hoshin planning, training,
coaching, or other methods.
10. Daily process management and standardization take place.
11. Progress is evaluated and the plan is revised as needed.
12. Constant employee awareness and feedback
reward/recognition process is established.

on

status

are

provided

and

Examples of Total Quality Management System Strategies

Strategy 1: The TQM element approach
The TQM element approach takes key business processes and/or organizational units and uses the
tools of TQM to foster improvements. This method was widely used in the early 1980s as
companies tried to implement parts of TQM as they learned them.

15

Examples of this approach include quality circles, statistical process control, Taguchi methods, and
quality function deployment.
Strategy 2: The guru approach
The guru approach uses the teachings and writings of one or more of the leading quality thinkers
as a guide against which to determine where the organization has deficiencies. Then, the
organization makes appropriate changes to remedy those deficiencies.
For example, managers might study Demings 14 points or attend the Crosby College. They would
then work on implementing the approach learned.
Strategy 3: The organization model approach
In this approach, individuals or teams visit organizations that have taken a leadership role in TQM
and determine their processes and reasons for success. They then integrate these ideas with their
own ideas to develop an organizational model adapted for their specific organization.
This method was used widely in the late 1980s and is exemplified by the initial recipients of
the Malcolm Baldrige National Quality Award.
Strategy 4: The Japanese total quality approach
Organizations using the Japanese total quality approach examine the detailed implementation
techniques and strategies employed by Deming Prizewinning companies and use this experience
to develop a long-range master plan for in-house use.
This approach was used by Florida Power and Lightamong othersto implement TQM and to
compete for and win the Deming Prize.
Strategy 5: The award criteria approach
When using this model, an organization uses the criteria of a quality award, for example, the
Deming Prize, the European Quality Award, or the Malcolm Baldrige National Quality Award, to
identify areas for improvement. Under this approach, TQM implementation focuses on meeting
specific award criteria.
Although some argue that this is not an appropriate use of award criteria, some organizations do
use this approach and it can result in improvement.

TQM Six Basic Concepts

1. Leadership
2. Customer Satisfaction
3. Employee Involvement
4. Continuous Process Improvement
5. Supplier Partnership
6. Performance Measures
Characteristics of Successful Leaders
1. Give attention to external and internal customers
2. Empower, not control subordinates. Provide resources, training, and work environment
to help them do their jobs
3. Emphasize improvement rather than maintenance
16

4. Emphasize prevention
5. Encourage collaboration rather than competition
6. Train and coach, not direct and supervise
7. Learn from problems opportunity for improvement
8. Continually try to improve communications
9. Continually demonstrate commitment to quality
10. Choose suppliers on the basis of quality, not price
11. Establish organizational systems that supports quality efforts
Issues for customer satisfaction Checklist for both internal and external
customers
1. Who are my customers?
2. What do they need?
3. What are their measures and expectations?
4. Does my product/service exceed their expectations?
5. How do I satisfy their needs?
6. What corrective action is necessary?
Customer Feedback
Discover customer dissatisfaction
Discover priorities of quality, price, delivery
Compare performance with competitors
Identify customers needs
Determine opportunities for improvement
Customer Feedback Tools/Method
Warranty cards/Questionnaire
Telephone/Mail Surveys
Focus Groups
Customer Complaints
Customer Satisfaction Index
Employee Involvement
People most important resource/asset
Quality comes from people
Project teams Quality Control Circles (QCC), QIT
Education and training life long, continuous both knowledge and skills
Suggestion schemes; Kaizen, 5S teams
Motivational programs, incentive schemes
Conducive work culture, right attitude, commitment
Continuous Process Improvement
View all work as process production and business
17

 Process purchasing, design, invoicing, etc.

Inputs PROCESS outputs
Process improvement increased customer satisfaction
Improvement 5 ways; Reduce resources, Reduce errors, Meet expectations of
downstream customers, Make process safer, make process more satisfying to the person
doing
Problem Solving Method
1. Identify the opportunity (for improvement)
2. Analyze the current process
3. Develop the optimal solution(s)
4. Implement changes
5. Study the results
6. Standardize the solution
7. Plan for the future

18