KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
DEFINITION OF QUALITY
Different people interpret quality differently.
The banker will answer” service”
The healthcare worker will answer “quality health care”
The hotel employee will answer “customer satisfaction”
The manufacturer will simply answer “quality product”
marie joahnna m. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Five Approaches of Defining Quality
Transcendent --- Excellence
Product based --- Quantities of attributes
User based --- Fitness for use
Manufacturing based --- Conformance to specs
Value based --- Quality vs Price
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
The core of TQM is the customer-supplier
interfaces, both externally and internally, and
at each interface lie a number of processes.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
This core must be surrounded by
commitment to quality, communication of
the quality message, and recognition of the
need to change the culture of the
organization to create total quality.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
These are the foundations of TQM, and they
are supported by the key management
functions of teams , tools and systems in the
organization
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
TOTAL – make up of the whole
QUALITY – degree of excellence of a product or service provides
to the customer in present and in the future
MANAGEMENT - act, art, or manner of handling controlling ,
directing
“TQM IS THE ART OF MANAGING
THE WHOLE TO ACHIEVE
EXCELLENCE”
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
The four Ps
and three
Cs of TQM
– a new
model for
TQM
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Benefits of Quality
Higher customer satisfaction
Reliable products/services
Better efficiency of operations
More productivity & profit
Better morale of work force
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Less wastage costs
Less Inspection costs
Improved process
More market share
Spread of happiness & prosperity
Better quality of life for all.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Indicators for Customer Satisfaction
Frontline empowerment
Excellent hiring, training, attitude and morale
for front line employees
Proactive customer service system
Proactive management of relationship with
customers
Use of all listening posts
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Quality requirements of market segment
Commitment to customers
Understanding customer requirements
Service standards meeting customers requirements
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Effects of poor Quality
Low customer satisfaction
Low productivity, sales & profit
Low morale of workforce
More re-work, material & labour costs
High inspection costs
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
High inspection costs
Delay in shipping
High repair costs
Higher inventory costs
Greater waste of material
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
COST OF QUALITY
THREE VIEWS OF QUALITY
1. Higher quality means higher cost
2. The cost of improving quality is less than the resulting
savings
3. Quality costs are those incurred in excess of those that
would have been incurred if the product were built or the
service performed exactly right the first time.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Key Elements :
I. Foundation - It includes: Ethics, Integrity
and Trust
II. Building Bricks - It includes: Training,
Teamwork and Leadership
III. Binding Mortar - It includes:
Communication.
IV. Roof - It includes: Recognition.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
I. Foundation
TQM is built on a foundation of ethics, integrity and trust. It fosters
openness, fairness and sincerity and allows involvement by everyone.
1. Ethics
good and bad in any situation/include personal rights or wrongs.
2.Integrity
Integrity implies honesty, morals, values, fairness, and adherence to the
facts and sincerity customers (internal or external) expect and deserve
to receive
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
3. Trust
fosters full participation of all members
allows empowerment that encourages pride ownership
encourages commitment
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
II. Bricks
4. Training – for productivity
5. Teamwork
provide more permanent improvements in processes and operations.
A. Quality Improvement Teams or Excellence Teams (QITS) –
temporary teams with the purpose of dealing with specific problems
set up for period of three to twelve months.
B. Problem Solving Teams (PSTs)
temporary teams to solve certain problems a
identify and overcome causes of problems.
last from one week to three months.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
C. Natural Work Teams (NWTs) –
small groups of skilled workers who share tasks and responsibilities
use concepts such as employee involvement teams, self-managing teams
and quality circles generally work for one to two hours a week.
6. Leadership - the most important element in TQM.
to provide an inspiring vision
make strategic directions that are understood by all
to instill values that guide subordinates.
supervisor must be committed in leading his employees
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
III. Binding Mortar
7. Communication –
it acts as a vital link between all elements of TQM
common understanding of ideas between the sender and the receiver
Downward communication
this is the dominant form of communication in an organization
supervisors are able to make the employees clear about TQM
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Upward communication
lower level of employees are able to provide suggestions to
upper management
Sideways communication
it breaks down barriers between departments
allows dealing with customers and suppliers in a more
professional manner
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
IV. Roof
8. Recognition
last and final element in the entire system
should be provided for both suggestions and achievements for teams
• Ways - It can be by way of personal letter from top management. Also by award
banquets, plaques, trophies etc.
• Places - Good performers can be recognized in front of departments, on
performance boards and also in front of top management.
• Time - Recognition can given at any time like in staff meeting, annual award
banquets, etc.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
COST OF QUALITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Quality affects all aspects of the organization and has
dramatic cost implications
Quality Control Costs Quality Failure Costs
Prevention Costs Internal Failure Costs
Appraisal Costs External Failure Costs
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
PREVENTION COST
incurred to keep failure and appraisal costs to a
minimum
Does not include basic processes like product
and process design, maintenance and customer
service
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
PREVENTION
COST
Product and Service
Requirements
Quality Planning
Quality Assurance
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Training
Inspection Equipment
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
APPRAISAL COST
costs incurred to determine the degree
of conformance to quality
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
APPRAISAL
COST
VERIFICATION
QUALITY
AUDIT
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
INTERNAL FAILURE COST
deficiencies discovered before delivery which are
associated with the failure (nonconformities) to
meet explicit requirements or implicit needs of
external
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
INTERNAL
FAILURE
COST
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
FAILURE
ANALYSIS
DOWNGRADING
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
EXTERNAL FAILURE COST
deficiencies that are found after
product is received by the customer.
included are lost opportunities for sales
revenue
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
EXTERNAL Repair and
Maintenance
FAILURE
COST
Warranty
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Complaints
Returns
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Loss goodwill
Liability
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cost of Quality Exercise
A manufacturing company wants to determine its cost of quality.
(a) Classify each of the costs below as prevention, appraisal, internal failure
or external failure.
(b) Total the costs in each category.
(c) Calculate the total cost of quality.
(d) What percentage of quality costs fall in each category?
(e) What conclusions do you draw?
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Type of Cost Amount ($)
Customer quality survey 40,000
Penalty payments to customers – late shipments 30,000
Materials and products scrapped 150,000
Raw material inspection 90,000
Quality training for employees 30,000
Losses due to defective products returned by customers 300,000
Finished goods inspection 250,000
Repairs to defective products before they leave the plant marie joahnna
140,000m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cost of Quality Solution
Prevention Costs Amount ($) % COQ
Quality training for employees 30,000
Quality software and information systems 20,000
Total Prevention Costs 50,000 4.1%
Appraisal Costs
Finished goods inspection 250,000
Raw material inspection 90,000
Customer quality survey 40,000
Total Appraisal Costs 380,000 31.4%
Internal Failure Costs
Materials and products scrapped before shipment 150,000
Repairs to defective products before they leave the plant 140,000
Overtime labor due to machine downtime 60,000
Total Internal Failure Costs 350,000 28.9%
External Failure Costs
Losses due to defective products returned by customers 300,000
Product repairs under warranty 100,000
Penalty payments to customers – late shipments 30,000
Total External Failure Costs marie430,000
joahnna m.. aranda
35.5%
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
DIMENSIONS
OF
QUALITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
PRODUCT
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
PERFORMANCE DURABILITY
AESTHETICS PERCEIVED QUALITY
FEATURES SERVICEABILTY
CONFORMANCE SAFETY
RELIABILITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
# Quality Dimension Definition
1 Performance Primary operating characteristics of a product.
2 Features Characteristics that supplement basic product performance
features.
3 Reliability Probability of a products success within a specific period of
time.
4 Conformance Degree to which a product’s design & operating
characteristics meet pre-established standards.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
# Quality Dimension Definition
5 Durability Measure of product life: Amount of time of use one
obtains from a product before it physically deteriorates.
6 Serviceability Speed, courtesy ease of use, maintenance and service.
7 Aesthetics The look, feel, sound, taste or smell of a product.
8 Perceived quality Relates to the customer’s subjective opinion of the
product’s or company’s reputation.
**9 Safety Free of danger or harm
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
Dimensions of Quality
Performance A must to increase speed from 0 to 100km/hr in 15 secs
Mileage : 13.2 kmpl
Convenient for drivers, Power steering, rear Ac vents,
Features
Adjustable seats,central locking, airbags
Car matches manufacturer’s specifications. They
Conformance
should pass all conformance tests.
There should be no need for repairs
Reliability
Dimensions of Quality
Durability Resistant to water and rust. Long life
Service Proper after sales service
Perceived Quality A top rated car
Safety Includes safety features in
case of accidents
Aesthetics Exterior and interior design
should be better than
industry standard.
51
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
SERVICE
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
RELIABILITY
ASSURANCE
TANGIBLES/COURTESY/ CONVENIENCE
EMPATHY
RESPONSIVENESS/TIME
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Reliability
The ability to provide what was promised
dependably and accurately.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Assurance
The ability to convey trust and confidence, and
demonstrate knowledge and confidence.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Tangibles
Physical appearance of personnel, facilities
and equipment
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Empathy
Care and individual attention given to
customers
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Responsiveness
This is the willingness to help customers
and provide prompt service.
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
The 5
Dimensions
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
7
QUALITY
TOOLS
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Man Method
Sub-Cause Sub-Cause
Sub-Cause
Effect
Sub-Cause Sub-Cause
Sub-Cause
Materials Machines
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect Pareto Diagram
400 100.0
Check Sheets 350 90.0
80.0
Count of Errors
300
Pareto Analysis
70.0
250 60.0
200 50.0
Histogram 150 40.0
30.0 Count
100
20.0
Cumulative %
Scatter Diagram
50 10.0
0 0.0
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect
Check Sheets
Pareto Analysis
Histogram
Scatter Diagram
Control Chart
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
Cause and Effect Start or end
Check Sheets An activity
Pareto Analysis a decision point in the process.
Histogram a point at which the flowchart connects with
another process.
Scatter Diagram An off page connection
Control Chart All records are identified
Flowchart
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
SM01 Enquiry Handling / Quotation Process
Customer Sales director Estimator
Customer sends Sales department
enquiry receives enquiry
Enquiry entered
into the electronic
Quote log &
Unique serial
number entered
Customer
Can this
informed that we
No enquiry be
are unable to
Quoted ?
quote
Yes
Have the
Enquiry allocated
item (s) been No
to Estimator
made before?
Raise estimate
sheet & plan
process
Quote prepared
from Price guide
Organize contract
review to cover
Quality
Contractual &
Manufacturing
aspects
Quote customer Prepare Quote
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
KOLEHIYO NG LUNGSOD NG LIPA
MARAOUY, LIPA CITY
marie joahnna m.. aranda
