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Unit V

Unit V of financial managemen

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33 views

Unit V

Unit V of financial managemen

Uploaded by

anmolagarwal370
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Unit V

Topics :

TQM, Deming’s 14 principles, Juran’s quality triology, PDCA cycle, KAIZEN,


quality circles, 7QC
tools and its 7 new management tools, ISO 9000-2000 clauses, six sigma, Total
Productive
Maintenance (TPM), 5S.

Total Quality Management

1. Introduction to Total Quality Management (TQM)

1.1 Definition
Total Quality Management (TQM) is a management approach aimed at embedding
awareness of quality in all organizational processes. It focuses on long-term success
through customer satisfaction and benefits all members of the organization and
society.

1.2 Core Concepts


Customer Focus: Understanding and meeting customer needs and expectations.
Continuous Improvement: Ongoing efforts to enhance products, services, or
processes.
Employee Involvement: Engaging employees at all levels in quality initiatives.
Process Approach: Managing activities and resources as processes to improve
efficiency and effectiveness.
System Integration: Coordinating interrelated processes to function as a coherent
system.

2. History and Evolution of TQM


2.1 Early Quality Management
- Inspection Era: Early 20th century focus on defect detection.
- Statistical Quality Control (SQC): Introduction in the 1930s and 1940s by Walter
A. Shewhart, emphasizing statistical methods for quality control.

2.2 Development of TQM


- W. Edwards Deming: Advocated for continuous improvement and the Plan-Do-
Check-Act (PDCA) cycle.
- Joseph M. Juran: Emphasized quality planning, control, and improvement.
- Philip B. Crosby: Promoted "Zero Defects" and the principle that "quality is free."

2.3 Modern TQM


- Evolution into a holistic management philosophy in the 1980s and 1990s.
- Adoption of international standards like ISO 9001.

3. Principles of TQM

3.1 Customer Focus


- Understanding Customer Needs: Conducting surveys, feedback sessions, and
market analysis.
- Exceeding Expectations: Continuously improving to not just meet but exceed
customer expectations.

3.2 Total Employee Involvement


- Empowerment: Encouraging employees to take responsibility for quality.
- Training: Providing necessary training to enhance skills and knowledge.
- Teamwork: Promoting collaboration across departments and functions.

3.3 Process-Centered Approach


-Process Mapping: Visualizing processes to identify inefficiencies.
- Standardization: Establishing best practices and standard operating procedures.

3.4 Integrated System


- Quality Management Systems (QMS): Integrating quality into the organizational
system (e.g., ISO 9001).
- Alignment: Ensuring alignment of processes with organizational goals.

3.5 Strategic Approach


- Long-Term Planning: Incorporating quality into the strategic planning process.
- Benchmarking: Comparing with industry best practices to set quality standards.

3.6 Continuous Improvement (Kaizen)


- PDCA Cycle: Iterative process of planning, doing, checking, and acting.
- Lean and Six Sigma: Methodologies for reducing waste and improving process
efficiency.

3.7 Fact-Based Decision Making


- Data Analysis: Using statistical tools and data analysis to guide decisions.
- Root Cause Analysis: Identifying and addressing the root causes of problems
rather than symptoms.

4. Tools and Techniques of TQM

4.1 Quality Tools


- Cause-and-Effect Diagram (Fishbone/Ishikawa): Identifying potential causes of
defects.
- Flowcharts: Visualizing processes to find improvement areas.
- Pareto Analysis: Prioritizing issues based on their impact.
- Control Charts: Monitoring process variations over time.
- Check Sheets: Collecting and analysing data.
- Histograms: Understanding data distribution.
- Scatter Diagrams: Identifying relationships between variables.

4.2 Quality Function Deployment (QFD)


- Translating customer requirements into technical specifications.

4.3 Failure Mode and Effects Analysis (FMEA)


- Identifying and addressing potential failure points in processes or products.

4.4 Benchmarking
- Comparing practices and performance with industry leaders to identify
improvement opportunities.

4.5 Statistical Process Control (SPC)


- Using statistical methods to monitor and control processes.

5. Implementation of TQM

5.1 Steps for Implementation


1. Commitment from Leadership: Securing top management support and
commitment.
2. Training and Development: Educating employees on TQM principles and tools.
3. Assessment: Conducting a quality audit to assess current practices.
4. Planning: Developing a TQM implementation plan with clear objectives.
5. Communication: Communicating the TQM vision and objectives to all
employees.
6. Process Redesign: Identifying and redesigning key processes for improvement.
7. Measurement: Setting up metrics and KPIs to track progress.
8. Continuous Review: Regularly reviewing and refining TQM practices.

5.2 Challenges in Implementation


- Resistance to Change: Overcoming employee resistance and cultural barriers.
- Resource Allocation: Ensuring adequate resources for training and process
improvements.
- Sustaining Momentum: Maintaining commitment and enthusiasm over the long
term.

6. Benefits of TQM

6.1 Organizational Benefits


- Improved Quality: Higher quality products and services.
- Customer Satisfaction: Increased customer loyalty and satisfaction.
- Operational Efficiency: Reduced waste and increased efficiency.
- Employee Morale: Higher employee satisfaction and engagement.
- Competitive Advantage: Enhanced market position and reputation.

6.2 Financial Benefits


- Cost Reduction: Lower costs due to fewer defects and inefficiencies.
- Revenue Growth: Increased sales through improved customer satisfaction.

DEMING’S 14 PRINCIPLES
Dr. W. Edwards Deming proposed 14 key principles for effective management.
These principles, outlined in his book “Out of the Crisis,” aim to transform
organizations and optimize their performance.

1. Create constancy of purpose toward improving products and services,


aiming to stay competitive, provide jobs, and remain in business.
2. Adopt the new philosophy, recognizing the challenges of the modern
economic age and taking leadership responsibility for change.
3. Cease dependence on inspection for quality; instead, build quality into
products from the start.
4. End awarding business based solely on price; focus on minimizing total
cost and establishing long-term supplier relationships.
5. Continuously improve production and service systems, enhancing quality,
productivity, and cost-effectiveness.
6. Institute on-the-job training for employees.
7. Promote effective leadership and supervision, helping both people and
machines perform better.
8. Eliminate fear, allowing everyone to work effectively.
9. Break down barriers between departments, fostering collaboration and
problem-solving.
10. Eliminate numerical goals for the workforce, avoiding adversarial
relationships.
11. Replace work standards and quotas with leadership.
12. Remove barriers to pride of workmanship among hourly workers.
13. Prioritize education and training for all employees.
14. Create top management structures that emphasize the above points

Juran’s Quality Trilogy

Dr. Joseph M. Juran’s Quality Trilogy is a renowned framework that has


significantly influenced quality management practices. Three key components are:

1. Quality Planning: This initial phase establishes the foundation for meeting
customer expectations. Key activities include:
o Defining quality goals based on customer needs.
o Identifying both internal and external customers.
o Translating customer requirements into actionable product and process
features.
2. Quality Control: In this phase, organizations execute the plans created during
quality planning. Essential activities involve:
o Evaluating actual performance against established quality goals.
o Regularly comparing results to identify gaps.
o Taking corrective action when deviations occur.

3. Quality Improvement: The final phase aims to continuously elevate


standards. Key activities include:
o Proving the need for improvement.
o Identifying specific areas for enhancement.
o Organizing teams to carry out improvement projects.

PDCA Cycle
The Plan-Do-Check-Act (PDCA) cycle, also known as the Deming Cycle or
Deming Wheel, is an iterative process for continuous improvement.

1. Plan: Recognize an opportunity and plan a change.


2. Do: Test the change by carrying out a small-scale study.
3. Check: Review the test results, analyze what you’ve learned.
4. Act: Take action based on the study findings. If the change didn’t work,
iterate with a different plan. If successful, incorporate the learning into wider
improvements.

The PDCA cycle ensures that improvement becomes an integral part of work
processes, leading to better products, services, and outcomes.

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