2. 1 Session 2 Philosophies and Frameworks and Frameworks S.P. JAIN CENTER OF MANAGEMENT

3. 2 Leaders in the Quality Revolution W. Edwards Deming W. Edwards Deming Joseph M. Juran Joseph M. Juran Philip B. Crosby Philip B. Crosby Armand V. Feigenbaum Armand V. Feigenbaum Kaoru Ishikawa Kaoru Ishikawa Genichi Taguchi Genichi Taguchi

4. 3 Who ’ s Who? Deming Juran Crosby

5. 4 Deming Chain Reaction Improve quality Costs decrease Productivity improves Increase market share with better quality and lower prices Stay in business Provide jobs and more jobs

6. 5 Deming ’ s System of Profound Knowledge Appreciation for a system Appreciation for a system Understanding variation Understanding variation Theory of knowledge Theory of knowledge Psychology Psychology

7. 6 Systems Most organizational processes are cross- functional Most organizational processes are cross- functional Parts of a system must work together Parts of a system must work together Every system must have a purpose Every system must have a purpose Management must optimize the system as a whole Management must optimize the system as a whole

8. 7 Variation Many sources of uncontrollable variation exist in any process Many sources of uncontrollable variation exist in any process Excessive variation results in product failures, unhappy customers, and unnecessary costs Excessive variation results in product failures, unhappy customers, and unnecessary costs Statistical methods can be used to identify and quantify variation to help understand it and lead to improvements Statistical methods can be used to identify and quantify variation to help understand it and lead to improvements

9. 8 Theory of Knowledge Knowledge is not possible without theory Knowledge is not possible without theory Experience alone does not establish a theory, it only describes Experience alone does not establish a theory, it only describes Theory shows cause-and-effect relationships that can be used for prediction Theory shows cause-and-effect relationships that can be used for prediction

10. 9 Psychology People are motivated intrinsically and extrinsically People are motivated intrinsically and extrinsically Fear is demotivating Fear is demotivating Managers should develop pride and joy in work Managers should develop pride and joy in work

11. 10 Deming ’ s 14 Points (Abridged) (1 of 2) 1. Create and publish a company mission statement and commit to it. 2. Learn the new philosophy. 3. Understand the purpose of inspection. 4. End business practices driven by price alone. 5. Constantly improve system of production and service. 6. Institute training. 7. Teach and institute leadership. 8. Drive out fear and create trust.

12. 11 Deming ’ s 14 Points (2 of 2) 9. Optimize team and individual efforts. 10. Eliminate exhortations for work force. 11. Eliminate numerical quotas and M.B.O. Focus on improvement. 12. Remove barriers that rob people of pride of workmanship. 13. Encourage education and self-improvement. 14. Take action to accomplish the transformation. www.deming.org

13. 12 Juran ’ s Quality Trilogy Quality planning Quality planning Quality control Quality control Quality improvement Quality improvement www.juran.com

14. 13 Juran ’ s Notions Quality as product features. What are external customers? What are external customers? What are internal customers? What are internal customers? How do you know what your customers want? How do you know what your customers want?

15. 14 Juran ’ s Notions Quality as freedom from defects. Is satisfaction created? Is satisfaction created? The importance of service recovery. The importance of service recovery. How good is good enough? How good is good enough?

16. 15 Is 99.99% Good Enough? 12 newborns will be given to the wrong parents everyday 12 newborns will be given to the wrong parents everyday 114,500 mismatched pairs of shoes will be shipped each year 114,500 mismatched pairs of shoes will be shipped each year 18,322 pieces of mail will be mishandled each hour 18,322 pieces of mail will be mishandled each hour 2,000,000 documents will be lost by the IRS this year 2,000,000 documents will be lost by the IRS this year 2.5 million books will be shipped with the wrong covers this year 2.5 million books will be shipped with the wrong covers this year 315 entries in Webster ’ s Dictionary will be misspelled 315 entries in Webster ’ s Dictionary will be misspelled

17. 16 … still good enough? 20,000 incorrect drug prescriptions will be written this year 20,000 incorrect drug prescriptions will be written this year 5.5 million cases of soft drinks produced this year will be flat 5.5 million cases of soft drinks produced this year will be flat 291 pacemaker operations will be performed incorrectly 291 pacemaker operations will be performed incorrectly 3056 copies of tomorrow ’ s Wall Street Journal will be missing one of the three sections 3056 copies of tomorrow ’ s Wall Street Journal will be missing one of the three sections How many customers will walk out of your doors and never come back? How many customers will walk out of your doors and never come back? The “ silent ones ” don ’ t stay silent for long - on average they tell six other people about their experience! The “ silent ones ” don ’ t stay silent for long - on average they tell six other people about their experience!

18. 17 High Performance Organizations Training and continuous learning Training and continuous learning Information sharing Information sharing New roles for employees New roles for employees New organizational structures New organizational structures New worker-management partnerships New worker-management partnerships Compensation linked to performance skills Compensation linked to performance skills Employment security Employment security Supportive work environments Supportive work environments Putting it all together Putting it all together

19. 18 Phillip B. Crosby Quality is free... : “Quality is free. It’s not a gift, but it is free. What costs money are the unquality things -- all the actions that involve not doing jobs right the first time.”

20. 19 Philip B. Crosby Absolutes of Quality Management: Quality means conformance to requirements Quality means conformance to requirements Problems are functional in nature Problems are functional in nature There is no optimum level of defects There is no optimum level of defects Cost of quality is the only useful measurement Cost of quality is the only useful measurement Zero defects is the only performance standard Zero defects is the only performance standard www.philipcrosby.com

21. 20 A.V. Feigenbaum Three Steps to Quality Three Steps to Quality Quality Leadership, with a strong focus on planning Quality Leadership, with a strong focus on planning Modern Quality Technology, involving the entire work force Modern Quality Technology, involving the entire work force Organizational Commitment, supported by continuous training and motivation Organizational Commitment, supported by continuous training and motivation

22. 21 Kaoru Ishikawa Instrumental in developing Japanese quality strategy Instrumental in developing Japanese quality strategy Influenced participative approaches involving all workers Influenced participative approaches involving all workers Advocated the use of simple visual tools and statistical techniques Advocated the use of simple visual tools and statistical techniques

23. 22 Genichi Taguchi Pioneered a new perspective on quality based on the economic value of being on target and reducing variation and dispelling the traditional view of conformance to specifications: Pioneered a new perspective on quality based on the economic value of being on target and reducing variation and dispelling the traditional view of conformance to specifications: No LossLoss Tolerance 0.5000.5200.480

24. 23 Deming Prize Instituted 1951 by Union of Japanese Scientists and Engineers (JUSE) Instituted 1951 by Union of Japanese Scientists and Engineers (JUSE) Several categories including prizes for individuals, factories, small companies, and Deming application prize Several categories including prizes for individuals, factories, small companies, and Deming application prize American company winners include: American company winners include: Florida Power & Light, and Florida Power & Light, and AT&T Power Systems Division

25. 24 Malcolm Baldrige National Quality Award Help improve quality in U.S. companies Help improve quality in U.S. companies Recognize achievements of excellent firms and provide examples to others Recognize achievements of excellent firms and provide examples to others Establish criteria for evaluating quality efforts Establish criteria for evaluating quality efforts Provide guidance for other U.S. companies Provide guidance for other U.S. companies Malcolm Baldrige, former U.S. Secretary of Commerce

26. 25 Criteria for Performance Excellence Leadership Leadership Strategic Planning Strategic Planning Customer and Market Focus Customer and Market Focus Information and Analysis Information and Analysis Human Resource Focus Human Resource Focus Process Management Process Management Business Results Business Results Baldrige Award trophy

27. 26 The Baldrige Framework – A Systems Perspective 4 Information and Analysis 5 Human Resource Focus 3 Customer & Market Focus 7 Business Results 7 Business Results 2 Strategic Planning 1 Leadership 6 Process Management Organizational Profile: Environment, Relationships, and Challenges

28. 27 Receive Applications Judges Select for Consensus Review? Judges Select for Site Visit Review? Stage 1 Independent Review Stage 2 Consensus Review Stage 3 Site Visit Review Stage 4 Judges Recommend Award Recipients to NIST Director/DOC Feedback report to applicant Feedback report to applicant Feedback report to applicant No Baldrige Award Evaluation Process

29. 28 The Baldrige Award Scoring System Three evaluation dimensions - Approach, Deployment, and Results Three evaluation dimensions - Approach, Deployment, and Results Scoring is linked to the importance to the applicant ’ s business Scoring is linked to the importance to the applicant ’ s business Scoring guidelines (Table 3.5) Scoring guidelines (Table 3.5)

30. 29 Feedback Report Strengths - approaches or results that demonstrate effective response to the Criteria Strengths - approaches or results that demonstrate effective response to the Criteria Opportunities for improvement - how the applicant can better address the purposes of the Criteria, or issues that require clarification Opportunities for improvement - how the applicant can better address the purposes of the Criteria, or issues that require clarification

31. 30 ISO 9000:2000 Quality system standards adopted by International Organization for Standardization in 1987; revised in 1994 and 2000 Quality system standards adopted by International Organization for Standardization in 1987; revised in 1994 and 2000 Technical specifications and criteria to be used as rules, guidelines, or definitions of characteristics to ensure that materials, products, processes, and services are fit for their purpose. Technical specifications and criteria to be used as rules, guidelines, or definitions of characteristics to ensure that materials, products, processes, and services are fit for their purpose.

32. 31 Objectives of ISO Standards (1 of 2) Achieve, maintain, and continuously improve product quality Achieve, maintain, and continuously improve product quality Improve quality of operations to continually meet customers ’ and stakeholders ’ needs Improve quality of operations to continually meet customers ’ and stakeholders ’ needs Provide confidence to internal management and other employees that quality requirements are being fulfilled Provide confidence to internal management and other employees that quality requirements are being fulfilled

33. 32 Objectives of ISO Standards (2 of 2) Provide confidence to customers and other stakeholders that quality requirements are being achieved Provide confidence to customers and other stakeholders that quality requirements are being achieved Provide confidence that quality system requirements are fulfilled Provide confidence that quality system requirements are fulfilled

34. 33 Structure of ISO 9000 Standards 21 elements organized into four major sections: 21 elements organized into four major sections: Management Responsibility Management Responsibility Resource Management Resource Management Product Realization Product Realization Measurement, Analysis, and Iimprovement Measurement, Analysis, and Iimprovement

35. 34 ISO 9000:2000 Quality Management Principles 1. Customer Focus 2. Leadership 3. Involvement of People 4. Process Approach 5. System Approach to Management 6. Continual Improvement 7. Factual Approach to Decision Making 8. Mutually Beneficial Supplier Relationships