1. Copyright © 2002 by Harcourt, Inc. All rights reserved. Topic 28 : Total Quality Management By Zhu Wenzhong

2. Copyright © 2002 by Harcourt, Inc. All rights reserved. State what is the quality of a product State what is the quality of a product Explain the difference between actual and perceived quality Explain the difference between actual and perceived quality State the definition of TQM State the definition of TQM State the characteristics of TQM or implications for a business State the characteristics of TQM or implications for a business State the benefits and problems of using TQM State the benefits and problems of using TQM LEARNING GOALS

3. Copyright © 2002 by Harcourt, Inc. All rights reserved. QualityQuality The features of a product that allow it to satisfy customers’ needs or simply some standard of excellence. The features of a product that allow it to satisfy customers’ needs or simply some standard of excellence. Actual quality Actual quality Perceived quality Perceived quality © PhotoDisc

4. Copyright © 2002 by Harcourt, Inc. All rights reserved. Total quality management (TQM) Total Quality Management (or TQM) is a management concept coined by W. Edwards Deming. The basis of TQM is to reduce the errors produced during the manufacturing or service process, increase customer satisfaction, streamline supply chain management, aim for modernization of equipment and ensure workers have the highest level of training. Total Quality Management (or TQM) is a management concept coined by W. Edwards Deming. The basis of TQM is to reduce the errors produced during the manufacturing or service process, increase customer satisfaction, streamline supply chain management, aim for modernization of equipment and ensure workers have the highest level of training.W. Edwards Demingsupply chain managementW. Edwards Demingsupply chain management A managerial approach which focuses on quality and aims to improve the effectiveness of the business involving every department, activity and individual. A managerial approach which focuses on quality and aims to improve the effectiveness of the business involving every department, activity and individual. It is also a method designed to prevent errors, such as poor quality products, from happening at every stage of the production process. It is also a method designed to prevent errors, such as poor quality products, from happening at every stage of the production process. © PhotoDisc

5. Copyright © 2002 by Harcourt, Inc. All rights reserved. Total quality management (TQM) Characteristics of TQM: Quality chains Quality chains Company policy and accountability Company policy and accountability Control Control Monitoring the process Monitoring the process Teamwork Teamwork Consumer views Consumer views Zero defects Zero defects © PhotoDisc

6. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM emphasizes quality chains inside and outside the business, including producers, suppliers and customers. Any part of the chain has some problems, then the next stage will delayed. TQM emphasizes quality chains inside and outside the business, including producers, suppliers and customers. Any part of the chain has some problems, then the next stage will delayed. Quality chains

7. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM stress the role of every one from the top to the bottom and aims to make every one accountable for his/her own performance. TQM stress the role of every one from the top to the bottom and aims to make every one accountable for his/her own performance. Quality chains Company policy & accountability Company policy & accountability

8. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM stresses a systematic control approach, controlling all the factors that may affect the quality of a product. TQM stresses a systematic control approach, controlling all the factors that may affect the quality of a product. See the next figure See the next figure Quality chains Control Company policy & accountability Company policy & accountability

9. Copyright © 2002 by Harcourt, Inc. All rights reserved. The systematic approach to quality Figure Feedback © PhotoDisc Good design Consistent methods Consistent materials Consistent Equipment Satisfactory instruction Operations and Control process Consistently satisfied customers

10. Copyright © 2002 by Harcourt, Inc. All rights reserved. TQM stresses the monitoring the process to find improvements through statistical process control such as charts and diagrams. Quality chains Company policy & accountability Control Monitoring the process © PhotoDisc Characteristics of TQM

11. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM stresses that teamwork is an effective way of solving problems. Quality chains © PhotoDisc Company policy Control Monitoring the process Teamwork

12. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM stresses the feedback of information from consumers and response to the changes in customers’ needs and expectations. Quality chains © PhotoDisc Company policy Teamwork Monitoring the process Consumer views Control

13. Copyright © 2002 by Harcourt, Inc. All rights reserved. Characteristics of TQM TQM emphasizes a zero defect policy that every product is free from defects. Quality chains © PhotoDisc Company policy Teamwork Monitoring the process Zero defects Control Consumer views

14. Copyright © 2002 by Harcourt, Inc. All rights reserved. Benefits and problems of using TQM Benefits: Focus on the customer needs and relationship Achieve quality in all aspects Analyzes all processes to remove defects Find improvements on a continuous basis Develop team approach to problem solving Effective procedures of communication Problems: High training and development costs Requiring commitment from the entire business Bureaucracy and regular audits are needed Stress is put on process not the product.

15. Copyright © 2002 by Harcourt, Inc. All rights reserved. Costs of ensuring costs Businesses are likely to face costs when trying to improve the quality of their products: Businesses are likely to face costs when trying to improve the quality of their products: The costs of designing and setting up control systems The costs of designing and setting up control systems The costs of monitoring the systems The costs of monitoring the systems The costs of faulty goods The costs of faulty goods The costs of improving the quality The costs of improving the quality … © PhotoDisc