TQM foundations

and
problem solving strategies
STAT12049 (MATH11168)
Week 3

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Objectives
• describe the contributions that Deming, Juran,
Ishikawa, Crosby and Conway have made to
TQM
• discuss the differences between traditional
total quality control in the West and in Japan
• explain the PDCA cycle
• construct a cause-and-effect diagram

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W. Edwards Deming (1900-1993)
• Deming was the first American quality
expert to teach in Japan
• he first arrived in 1947 to assist General
MacArthur’s government of occupation
prepare for a census
• at that time he was employed as head
mathematician and advisor in sampling at the
US Bureau of Census

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• his academic credentials included a masters degree
from the University of Colorado and a PhD in
Mathematical Physics (1928) from Yale
University
• he produced approximately 200 publications
• he retired from his position at New York
University in 1975 to become Emeritus Professor
• at 91 he was still writing and publishing articles
and books, holding seminars etc

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• at the Census Bureau he had taught sampling
methods and statistical control techniques resulting
in huge increases in productivity for the 1940
census
• this success led to his invitation to teach quality
courses for US industrialists, engineers and
inspectors
• his methods were credited with better quality
products, a higher volume of production and
reduction in scrap and rework (all adding to
America’s war effort) 5
• he was disappointed by the management of American
companies who did not take to his ideas
• in Japan he continued his successful teaching of
quality and productivity ideas and insisted that
Japanese management be involved
• he worked with many well known companies such as:
Sony, Nissan, Mitsubishi and Toyota
• he believed that quality and productivity always
increased as variability decreased – his main message
was to reduce variation
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• the Deming Award has been, since 1965, the most
fiercely fought for and coveted award in Japan
• it is given annually to chosen Japanese companies,
worker groups and individuals who have distinguished
themselves in the area of total quality
• Deming has been called the ‘father of the third wave of
the industrial revolution’ by some because of his
contributions to quality
• others believe his role is been overstated and that his
major contribution was simply to convey mathematical
concepts more clearly to the people involved
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 Deming’s approach is based on understanding two
types of variation:
• Controlled (common cause) variation – due to
unassignable, chance, random or common causes.
These causes are due to the process itself, its design
and installation
• Uncontrolled (special cause) variation – due to
assignable or special causes. For example, change
of operation, procedures or raw materials and
breakages are all outside influences on a process
which interrupts its normal pattern of operation 8
• uncontrolled variation leads to high costs and
unknown quality – it also makes it impossible to
evaluate any attempts to improve a system
• controlled variation leads to better ability to schedule
activities closer together since it is more predictable
and it is easier to eliminate waste and delay
• so firstly we must eliminate special causes and then
we are able to look at quality improvement
• these concepts will be revisited frequently in this
course
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• Deming states that 94% of all quality problems are
due to management
• management need to include employees in decision-
making processes and empower workers to help
solve problems
• many of the concepts discussed appear in Deming’s
book “Out of Crisis” which is a modern classic in
total quality
• Deming is particularly famous for his 14 points

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Deming’s 14 points
1. Be constant and purposeful in improving products and services.
Allocate resources to provide for long-term needs rather than
short-term profitability. Aim to be competitive, to stay in
business and to provide jobs.
2. Adopt the new philosophy. We are in a new economic age
begun in Japan. Commonly accepted delays, mistakes and
defective workmanship can no longer be tolerated; a
transformation of Western management approach is needed to
stop the downward spiral of decline in industry.
3. Stop depending on mass inspection as a way to achieve quality;
build quality into the product in the first place. Demand
statistical evidence of quality being built into manufacturing and
purchasing functions.

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4. End the practice of awarding business on the basis of price alone.
Instead require other meaningful measures of quality beyond
price. Work to minimize total cost not just initial cost. Move
towards a single supplier for any one item on a long-term
relationship of loyalty and trust. Make sure purchasing managers
realize they have a new job to do.
5. Find problems. It is management’s job to improve the system
continually, make better every process for planning, production
and service to improve quality, increase productivity and decrease
costs.
6. Institute modern methods of on-the-job training. Include
management in the training to make better use of all employees.
New skills are required to keep up with changes in material,
methods, product design, machinery, techniques and service.
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7. Set up new ways of supervising production workers. Front-line
supervisors should help people produce quality products, forgetting
about the numbers game. Improvement of quality will
automatically improve productivity. Management should initiate
action in response to reports of inherited defects, maintenance
needs, bad tools, confused operational definitions and other things
that lead to poor quality.
8. Drive out fear, so that everyone may work effectively for the
company. Encourage top-down and bottom-up communications.
9. Break down barrier between departments. People in research,
design, sales and production should work as a team to deal
effectively with problems with products and services.

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10. Eliminate numerical goals, slogans, exhortations (like zero defects)
and product targets for the workforce since most quality problems
have to do with processes and systems which are created by
managers and are beyond the power of employees. Such
exhortations are simply a source of aggravation.
11. Eliminate work standards that prescribe numerical quotas for both
the workforce and for managers. In their place put useful aids and
supportive supervision. Use statistical methods for continuous
improvement of quality and productivity.
12. Remove barriers that impede hourly-paid workers and managers
from enjoying pride of workmanship. Abolish performance
appraisal and management by objectives.

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13. Institute a vigorous programme of eduction and
training. People should be improved with ongoing
education and self-improvement. Competitive
advantage is always rooted in knowledge.
14. Structure top management to empower them to
achieve the above 13 points. Push every day to
progress the 13 preceding points and take action to
make the total transformation happen.

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Some comments on Deming’s 14 points:
• eliminate numerical targets and performance
appraisals – the results produced by a worker
are limited by the system
• numerical targets can be beyond what a system
is capable of and hence management can push a
system out of shape
• performance appraisals are unfair when a large
amount of common cause variation is present
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Barriers to implementing Deming’s philosophy

• lack of constancy – management of a system

should not flit from one idea to another (avoid
the latest fads)
• preoccupation with short-term profit –
management should be consistent in order to
foster long-term growth
• managerial job mobility – decisions are made
without an in-depth knowledge of the business

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• reliance on visible figures as a criteria for
success – although accounts matter and
employees and suppliers must be paid, end-of-
quarter manipulation of figures can be a result
of pressure to perform
• performance appraisals – Deming equates
these with ‘management by fear’

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 Joseph M. Juran
• Juran is a Balkan-born American who is now in
his 90’s
• he operates the Juran Institute in New York
• he earned his reputation in the 1950’s with his
book “Quality Control Handbook” which is still a
standard reference in quality world-wide
• after the books’ publication, he went to Japan to
build on Deming’s work there
• he based his message around ten steps
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Juran’s ten steps
1. Create awareness of the need and opportunity for
quality improvement.
2. Set goals for continuous improvement.
3. Build an organization to achieve goals by
establishing a quality council, identifying problems,
selecting a project, appointing teams and choosing
facilitators.
4. Give everyone training.
5. Carry out projects to solve problems.
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6. Report progress.
7. Show recognition.
8. Communicate results.
9. Keep a record of successes.
10. Incorporate annual improvements into the
company’s regular systems and processes and
thereby maintain momentum.

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• Juran’s main message was that quality is an
integral part of management at all levels of a
company
• his quality messages and techniques were
translated into reading material for reading
circles in Japan – these later developed into
quality circles (problem solving quality
improvement meetings for all levels of
employees)
• Juran produced (and still does) training manuals
and conducted quality training and seminars 22
• Juran defines quality as “fitness for use or
purpose” rather than conformance to
specifications
• he believed a product could conform to all
specifications but still be unfit for use
• he was responsible for taking quality beyond
the technical aspects to the management arena

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• Juran’s essential message to managers is his
trilogy: quality planning, quality control and
quality improvement (see Figure 3.3 in Bank)
• Quality planning – the process for preparing to
meet quality goals
• Quality control – the process for meeting
quality goals during operation
• Quality improvement – the process for breaking
through to unprecedented levels of performance
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• Juran estimated that 15% of quality problems
(variation) in a company are due to special causes
which means they may involve the workers
• he believed that 85% or more are due to
management dealing with the system

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Prof. Kaoru Ishikawa (1915-89)
• Ishikawa was known as the ‘Father of Quality
Circles’ for his role in launching Japan’s
quality movement in the 1960’s
• he believed the American management style
where “management manage and people do”
would not work in Japan, but suggested
American and Japanese business practices be
blended with European craftsmanship

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• his quality circles were piloted at Nippon
Telegraph and Cable Company in 1962
• by 1978 there were one million quality circles
with 10 million employees mostly in
manufacturing
• today there are two million quality circles
involving 20 million members and extending into
the service sectors in Japan

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• his ‘fishbone diagram’, the Ishikawa diagram or
cause and effect diagram, was invented in 1943
as a management problem solving tool
• his book “What is Total Quality Control?”
introduced seven basic tools he believed were
indispensable for quality control: pareto analysis,
fishbone diagrams, stratification, tally charts,
histograms, scatter diagrams and control charts

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 Philip B. Crosby
• Crosby was a less academic populariser of TQM
• he obtained his quality education by coming up
the ranks from inspector to tester to assistant
foreman to junior engineer to section chief to
manager to director and finally to corporate
vice-president
• this progression has given him an overall
understanding of business practices

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• today he is chairman of his own quality college
and consultancy firm call Philip Crosby
Associates (PCA) Inc., which he started in 1979
• he differs from Deming and Juran because he
believes that a zero defects goal is practical,
reasonable and achievable
• Crosby targets his training at management not at
quality control people

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 Crosby’s four essentials of quality management
(he calls these ‘the absolutes’) are:
1. Quality is defined as conformance to requirements, not
as goodness.
2. Quality is achieved by prevention not appraisal.
3. The quality performance standard is zero defects (a
concept he invented in the 1960’s when he worked for
the Martin company on missile projects) and is best
known for no acceptable quality levels.
4. Quality is measured by the price of non-conformance,
not by indexes.
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• Crosby also developed 14 steps to a quality
improvement programme
(see Bank, pp. 99-102)

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John S. Oakland
• Oakland is Britain’s foremost leader in the
philosophy of total quality management
• he comes from a nuts and bolts, no nonsense
operations management perspective
• his early career was in research and production
management and he has a PhD in chemistry
• his book “Total Quality Management” is the
seminal British book on TQM
• the new edition “Cases in Total Quality
Management” was co-authored by Leslie J. Porter
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• he also wrote “Statistical Process Control”
• his main contribution has been to further
integrate TQM into company strategy
• he defines TQM as ‘a comprehensive approach to
improving competitiveness, effectiveness and
flexibility through planning, organising and
understanding each activity and involving each
individual at each level”
• Oakland’s implementation plan for TQM
involves 14 steps (see Figure 3.5 of Bank) 34
Oakland’s model can be summarised in five points:
1. First one must identify customer-supplier
relationships.
2. Then set up a system to manage processes.
3. Change the company culture from what it was
to a TQM culture.
4. Improve communications company-wide.
5. Demonstrate commitment to quality.

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 Differences between Japanese and
Western approaches to Quality
• Western management is often hierarchical and
focused on control
• Japanese management see their role as supportive
of those closer to the customer – the customer is
often incorporated into the decision making process
• a move is being made away from the Japanese style
quality circles which usually contain workers from
the same divisions to cross-functional teams from
various divisions that address goals that are
common to the whole organisation such as quality,
costs and scheduling 36
• some people suggest that empowerment is a
cornerstone for effective Quality Management
• giving decision making authority to workers
gives them a sense of ownership and
responsibility and is likely to lead to a reduction
of mistakes
• it allows for creativeness and innovation
• it increases worker morale which can lead to
reduced turnover time, absenteeism and illness
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• the Japanese place less emphasis on specialist
professionals – TQM involves the entire
workforce
• in the West specialists are often attached to
divisions
• Japanese unions are enterprise wide whereas
Western unions are usually based on trades
• Westerners tend to formulate management plans
and expect the workers to simply follow these
plans without making any contribution 38
• Japanese companies are more likely to hire
technical school graduates – there is less elitism
and shopfloor experience is held in greater
esteem
• Japanese companies place less emphasis on
merit pay – they take into account satisfaction
from a job well done, happiness from
cooperating with others, joy from personal
growth as well as monetary rewards
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• owner managers are rare in Japan – owners
and shareholders do not pressure companies
for short term gains at the expense of the
medium and longer term as often happens in
the West
• Western companies make definitions regarding
quality that indicate they are interested in high
quality rather than Ishikawa’s view of
achieving quality appropriate to the customer
at a reasonable price
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• Westerner’s tend to seek dramatic
improvements whereas the Japanese approach
is to seek small incremental changes

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The PDCA Cycle

Act Determine Plan

Take goals
appropriate
action Determine
methods

Educate
Check the
effects
Implement
Check Do
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Plan: the first step must be to identify the aspect
of the process in most urgent need of
improvement. This might also mean choosing
to examine an aspect of the process which will
produce the greatest benefit for the least
amount of effort. Once the problem is
identified and the process fully understood, a
plan can be formulated in order to bring about
an improvement to the process.

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Do: In this stage, the plan is implemented and
trials are conducted using the solution
proposed in the planning phase. It may also
be necessary to educate those involved in the
process and to train them in any new methods
being implemented.
Check: Here data is collected and analysed to
determine the degree to which the
improvement was successful.
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Act: If the new approach is deemed to be
successful, then the necessary action is taken
to permanently implement it within the
system.

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It should be noted that this cycle is designed to
bring continuous improvement to a process,
and thus the user will need to make many
revolutions of the cycle. The ultimate goal of
such a procedure is to reduce the number of
problems in the system to zero. This however,
is a goal that is never likely to be attained. The
process will instead continually make steps
towards the goal of a perfect or ideal process.

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Ishikawa diagrams
Brainstorming
• a structured problem-solving technique
designed to generate ideas and produce group
consensus of their relative importance
• a group will achieve more ideas than the sum
of individual ideas – participants are able to
build on the ideas of others
• Week 4 examines brainstorming in more detail
and those ideas will be used when constructing
Ishikawa diagrams in Assignment 2 47
• Ishikawa diagrams (cause and effect diagrams)
aim to clearly summarise the possible causes of
an effect (either desirable or undesirable)
• the effect could be a defect in a product, a
better product etc
• we are aware of the nature of the effect but
want to determine what caused it, often in
order to improve the situation

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• we must always clearly define the effect or
problem ensuring that it is a single effect, not a
group of related effects
• we should generate as many ideas as possible
about the possible cause of an event (using a
brainstorming session)
• after an idea is added, find other ideas by
asking “what caused this?” but don’t evaluate
ideas yet
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Top-down generation of causes – start with the
effect and work towards the cause by asking
why (often referred to as why-why analysis).
Problem – only causes identified in first step
are explored further
Bottom-up generation of causes – ideas are
generated without any restrictions and by
whatever means available (brainstorming or
nominal group technique are used – we
examine these next week)
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Process phases generation of causes – effects
are often associated with processes, so this
method examines each phase of a process one
at a time.

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• once a list of possible causes has been reached, the
diagram can be constructed. It is not unusual to
expect approximately 100 ideas from the
brainstorming session – more ideas may be
thought of and added as the diagram is constructed
• first the effect should be written in a box on the
right-hand side of the page
• next, the possible causes should be grouped into
categories, for example “work method”,
“workers”, “equipment” and “measurement” are
common headings for an industrial process 52
• possible causes may be put under more than
one heading if necessary
• now within each heading, identify different
levels of causality
• the headings are usually called the first level
causes, factors that contribute directly to these
are second level causes, then third level causes
etc
• the (simplified) fishbone diagram on the
following page illustrates this layering of 53
causes
Simplified Cause and Effect Diagram Example

Classes Study material

Not Arrived late
Clash with interesting
another class
Too expensive Poorly
written
Absent
Bad time regularly
of day Poor exam
No planning performance
Does not
know subject Not available Watching TV
material outside class
Poor Too many late nights
Not well explanations
prepared Busy social
life
Teaching Organisation 54
• Note that the example on the previous slide is
simplified – a fishbone diagram produced for an
assignment should contain much more detail
• in this diagram, the first level causes are
“Classes”, “Study Material”, “Teaching” and
“Organisation”
• an example of a second level cause is “Too many
late nights” and a third level cause is “Watching
TV”
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There are a number of different formats for
the cause and effect diagram, but the example
on the previous slide is best for our purposes.
Figure 3.2 of Ledolter shows a diagram that
is a combination of a flowchart and a cause
and effect diagram.

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• once a cause and effect diagram has been
produced, we should now use it to determine
the most likely cause(s) of the effect
• sometimes this may mean choosing one factor
as most significant and leaving others for
examination later in another revolution of the
PDCA cycle
• we search for the most likely cause by
eliminating all possible causes except for one
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• there is a tendency to jump to conclusions about
what is the most likely cause of the effect – avoid
this temptation and make sure the decision is a
considered and well justified one
• a good way of choosing between a number of
possible causes is to create a Pareto chart: get
group agreement on which are the most likely
causes and then ask each group member to rank
these causes from least to most likely. Construct
a Pareto chart of the average of these ranks.
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Have a go at Exercise 3.2 from Ledolter, but
use the PDCA cycle instead of the IDEA
procedure.

Also do Activity 3-2 from the Study Guide.

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