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Chapter Two

Literature Review

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2.1Total Quality Management (TQM)

Dr. W. Edwards Deming has emerged as the most
influential guru of quality management in the United States and Japan .During
the period 1927 to early 1940, he had begun the utilization of statistics and sampling
methods successfully at the U.S. Department of Agriculture. Quality management
(TQM) was coined to vary American quality management systems from Japanese and
so to derivate the theories and writings of the major American quality experts.
As cited by Lawrence (1993) TQM is a sort of umbrella term, used to define
various American quality management systems operating in both the public and
private sectors.

In his literature review, TQM has been defined as
“the use of quantitative methods and human resources to make better the
material and services supplied to an organization, all the processes within an
organization, and the degree to which the needs of the customer are achieve now
and in the future”(Mossard, 1991,as cited in Lawrence, 1993). The reference
to both quantitative methods and human resources in this definition is
reflective of TQM’s attempt to integrate the analytical perspective of
scientific management with the human relation school’s focus on organizations, groups,
and employees (kronenberg&Loeffler, as cited in Lawrence, 1993).In other
word,

Lawrence (1993) added that TQM is an attempt to blend
the analytical and working smarter aspects of scientific management with the
organizational, group, and employees focus of the human relation school.

2.1.1 Customer Defined Quality.

One of the areas of general consent among the big four
quality experts (Deming, Juran

Crosby and Fegenbaum) is that customers evaluate the
relative significanceof different quality dimensions. For example, Fegenbaum,
1983 (as cited in Lawrence, 1993) states that quality means products and
services that “achieve the expectation of customers.” Crosby, 1983
(as cited in Lawrence, 1993) define quality as “conformance to requirements.”
Since customers determine what the necessaries are, according to Crosby, this
is just another way of saying that customers define quality.Juran 1989 (as
cited in Lawrence, 1993) states that quality is “fitness for use.”As the
customer determines either a product or service is fit for use. In other words
it means that customers define quality.

Deming does not really define quality, but a
definition can be reflected from his writings: the reduction of variation.
Since variation is happened due to quality problems, the less variation – the higher
the quality. Deming was the only in his view that quality is not defined solely
by the customer. He maintains this posture since he believed that customers do
not know all the various ways a product or service can be improved .Despite
Deming’s caveat, Lawrence proposed in his book TQM takes the position that
quality is primarily, if not exclusively, defined by customers. Richardson
(1997) added that there is one fundamental principle of TQM; it is that quality
is what the customer defines it as, not what the organization describes it to
be. According to whitely (as cited in Richardson, 1997) the customer driven
company moving from word to action, “companies that deliver what their
customers need differ from others in diverse but reasonable ways. Maybe most
fundamentally, they offer high quality not according to definitions they have
grown on thereon but rather as the customer defines it.”

2.1.2 Quality Gurus (Experts of quality or coaches of
quality)

The four quality gurus opposes old concept of be
reactive, designed to correct quality problems after they occur. They support
new concept of proactive, proposed to build quality into the product and
process design.

Lawrence (1993) wrote in his book to completely
understand the TQM movement, we have to look at the five notable Quality gurus
who have created the evolution of TQM. Their philosophies and teachings have
role to our knowledge and understanding of quality today. According to Richardson
(1993) Philip B Crosby, Joseph M.Juran, and W.Edwards Deming are crusaders for the
Holy Grail of TQM. Lawrence (1993) called them as the patriarch of TQM.

W. Edwards Deming

According to Lawrence (1993) W. Edwards Deming is
often referred to as the “father of quality control.” He was a statistics
professor at New York University in the 1940s. After World War II he assisted
many Japanese companies in controlling quality. The Japanese regarded him so
highly that in 1951 they existed the Deming Prize, an annual award given to
firms that demonstrate outstanding quality. It was almost 30 years later that
American businesses began adopting Deming’s philosophy. A number of elements of
Deming’s philosophy depart from traditional notions of quality. The first is
the contribution of management should play in a company’s quality improvement
role. Historically, poor quality was blamed on workers on their weakproductivity,
laziness, or carelessness. However, Deming dig out that only 15 percent of quality
problems are practically due to error of worker. The remaining 85 percent are
due toprocesses and systems, including weak management. Deming said that it is
up to management to correct system problems and create an environment that
creates quality and motivatesworkers to achieve their full capacity. He believed
that managers should throw out any fear employees have of identifying quality
problems, and that numerical quotas should be destroyed. Proper methods should
be taught and detecting and eliminating poor quality should be everyone’s duty.

According to Richardson (1997) In Deming’s classic out
of crisis, he was extremely critical of management and noted that it is
responsible for most quality problems. His famous fourteen points and seven
deadly diseases focus on management as being even more significant than
statisticaltools. According to Lawrence (1993) Deming outlined his philosophy
on quality in his famous “14 Points.” These points are principles that help
guide companies in achieving quality improvement. The principles are founded on
the idea that upper management must develop a commitment to quality and offer a
system to support this commitment that involves all employees and suppliers.
Deming stressed that quality improvements cannot happen without organizational
change that comes from upper management.

Joseph M. Juran

According to Richardson (1997) After W. Edwards
Deming, Dr.JosephJuran is considered have had the greatest influence on quality
management. Juran originally worked in the quality program at Western Electric.
He became well known in 1951, after the publication of his book Quality Control
Handbook. In 1954 he went to Japan to work with manufacturers and teach classes
on quality. Though his philosophy is similar to Deming’s, there are some
differences.

Whereas Deming lined the need for an organizational
“transformation,” Juran believes that implementing quality initiatives should
not require such a radical change and that quality management should be
embedded in the organization.

Richarson (1997) cited in his book, Juran announced
that specified requirements may be what managements want but adds the needs of
customers. Quality is not just a function of inspection and control but a part
of all management functions in an organization.

According to Lawrence (1993) One of Juran’s important
contributions is his focus on the definition of quality and the cost of
quality. Juran is credited with defining quality as fitness for use rather than
simply conformance to specifications. When Juran ,defining quality as fitness
for use takes into account customer intentions for use of the product, instead
of only focusing on technical specifications. Richardson (1997) noted that
Juranfavours the concept of quality circles because they improve communications
among management and labour.

According to Lawrence (1993) Juran is better known for
originating the idea of the quality trilogy: quality planning, quality control,
and quality improvement. The first part of the trilogy, quality planning, is
necessary so that companies identify their customers, product requirements, and
overriding business goals. Processes should be set up to ensure that the
quality standards can be achieved. The second part of the trilogy, quality
control, stresses the usual use of statistical control methods to ensure that
quality standards are met and to identify differences from the standards.

The third part of the quality trilogy is quality
improvement. According to Juran, quality improvements should be progressive as
well as breakthrough.

Armand V. Feigenbaum

Another quality leader according to Lawrence (1993) is
Armand V. Feigenbaum, who proposed the concept of total quality control.
Feigenbaum took a total system approach to quality. He promoted the idea of a
work environment where quality developments are derived throughout the whole
organization, where management and employees have a total commitment to improve
quality, and people taught from each other’s successes. From Feigenbaum we
learn about the “cost of Quality” and why it is cheaper in the long
run to build quality in to products and services than to correct errors later.

Phillip B. Crosby

According to Lawrence (1993) Crosby is concerned with
the tools of TQM. Deming is frequently described as the TQM philosopher; Crosby
is often described as a TQM technician.

He introduced the phrase “Do it right the first time”
and the notion of zero defects, arguing that no amount of defects should be
considered acceptable. He scorned the idea that a small number of defects are a
normal part of the operating process because systems and workers are imperfect.

Instead, he lined in the concept of prevention.

To promote his concepts, Crosby wrote a book titled
Quality Is Free, which was published in

1979. He became known for coining the phrase “quality
is free” and for pointing out the many costs of quality, which include not only
the costs of wasted labour, equipment time, scrap, rework, and lost sales, but
also organizational costs that are hard to quantify.

 

Like Deming and Juran, Crosby stressed the
contributions of management in the quality improvement effort and the use
ofstatistical control tools in measuring and monitoring quality.

Kaoru Ishikawa

According to Richardson (1997) Dr. Ishikawa edited
JUSE’S hand book, Quality control forforemen, which is a guide for establishing
and met quality circles or he was a proponent of implementation of quality
circles, which are small groups of employees that volunteer to, solves quality
problems.

Kaoru Ishikawa is best famous for the development of
quality tools called cause-and-effect diagrams, also called fishbone or
Ishikawa diagrams. These diagrams are used for quality problem solving. He was
the first quality guru to emphasize the significance of the “internal customer,”
the next person in the production process. He was also a pioneer to stress the importance
of total company quality control, rather than just focusing on products and
services.

Dr. Ishikawa believed that everyone in the company
needed to be united with a shared vision and

a common goal. He stressed that quality initiatives
should be pursued at every level of the organization and that all employees
should be participate.

2.1.3 Common Ground among the Big Four TQM Experts

According to Lawrence (1993) Deming, Crosby, Juran, and
Feigenbaum disagree with each other frequently with considerable vigour over
exactly what TQM means as a philosophy of management. Despite their areas of
disagreement, however, several key areas of general agreement do exist. These
areas of common ground also provide useful insights into TQM as a philosophy of
management.

He has Six key elements of general agreement that were
identified to appear as central to an understanding of TQM as a philosophy of
management. These six key elements are

(a) Quality as a pioneer organization goal,

(b)Quality being calculated by an organization’s
customers,

(c) Customer satisfaction being the fuel that enables
an organization travel long,

(d) The study and reduction of variation in processes,

(e) Change being progressive and doneby teams and
teams work, and

(f) Top management commitment for promoting a culture
of quality, employee empowerment, and a long- term perspective In addition
contractor involvement in TQM program in the organization is another major
issue in TQM program. Source: Lawrence, 1993

 

2.1.4. Comparison of Traditional Management philosophy
and TQM philosophy

Lawrence (1993) wrote in his book there is difference
in traditional American management philosophy and TQM in substance and style.

Table 2.1 compares principles derived from traditional
American management philosophy with TQM philosophical principles. Some of the
major principles of traditional American management philosophy are (a) profit
and bottom line considerations as the primary necessaryforces, (b) a preference
for competition over cooperation, (c) the belief that change occurs in quantum’s
, and (d) a penchant for what the Japanese call “cowboy management”
(Imai,1986 as cited in Lawrence, 1993),or entrepreneurial champions who battle
bureaucracies to bring about innovations and change (peters & Waterman,1982
as cited in Lawrence 1993).Finally, the slogan that may best characterize
traditional American management philosophy is, “If it is not broke , don’t
fix it.”Underlying this slogan is the belief that when an organization is
running smoothly, managers and employees can simply sit back and rest on their
laurels.

 

Traditional American Management
Principles

Total Quality Management (TQM)

1

The organization has multiple competing
Goals.

Quality is the pioneer organizational goal.

2

Financial concerns drive the organization.

Customer satisfaction drives the organization

3

Management and professionals determine what quality
is.

Customers Determine what quality is.

4

The focus is on the status quo- “If it
Is not broke, don’t fix it.”

The focus is on continuous
improvement-“unattended tend to run down.”

5

Change is abrupt and is accomplished by
Champions battling the bureaucracy.

Change is continuous and is accomplished by team
work

6

Employees and departments compete with each other.

Employees and departments cooperate with each other.

7

Decisions are based on “gut feelings.” It
is better to do something than to do nothing.

Decisions are based on data and analysis. It is
better to do nothing than to do the wrong thing.

8

Employee training is considered a luxury and a cost

Employee training is considered essential and an
investment.

9

Organizational communication is primarily top down.

Organizational communication is Top-down, down up, and
sideways

10

Contractors are encouraged to compete with each
Other on the basis of price.

Long-term relationships are developed with
contractors who deliver quality products and services.

 

Adapted from Lawrence, 1993

2.1.5. The Philosophy of TQM

What characterizes TQM is the focus on identifying
root causes of quality problems and correcting them at the source, as opposed
to inspecting the product after it has been made. Not only does TQM encompass
the whole organization, but it stresses that quality is customer driven.

TQM attempts to embed quality in every aspect of the
organization. It is concerned with technical aspects of quality and the
participation of people in quality, such as customers, company employees, and
suppliers. Here we look at the specific concepts that made up the philosophy of
TQM.

Customer Focus

The first, and overriding, feature of TQM is the
company’s focus on its customers. Quality is defined as achieving or exceeding
customer expectations. The aim is to first identify and then achieve customer
needs. TQM recognizes that a perfectly produced product has low value if it is not
what the customer needs. Therefore, we can say that quality is customer driven.
However, it is not always easy to determine what the customer desire, because
tastes and preferences change.

Also, customer expectations often vary from one
customer to other. Lawrence (1993).The customer who complain, have problems, or
are not satisfied with a process .product or service is the most important
customers. These customers are helping point the way for continuous improvement.
Richardson (1997).

Continuous Quality Improvement

According to Richardson, in step five of Deming
points, management is obligated to continually look for ways to improve
quality. Another basic tenets of TQM as a philosophy of management is the
notion of continuous quality improvement through team work.

Traditional American management theory tends to view
change as being radical in nature and occurring in quantum leaps. Change comes
about as a result of “breakthrough” created by the introduction of
new technologies (Carr , 1990 as cited in Lawrence 1993) or by “champions”
who engage the bureaucracy in individual combat to promote their ideas (Peters

, 1982 as cited in Lawrence in
1993).Change in TQM is constant and, consequently, tends to be incremental in
nature. Change in TQM tends to be slow and plodding, but in the end successful.

Traditionally, change for American managers involves
large magnitudes, such as major organizational restructuring. The Japanese, on
the other hand, believe that the best and most lasting changes come from
gradual improvements. To use an analogy, they believe that it is better to take
frequent small doses of medicine than to take one large dose. Progressive improvement,
called kaizen by the Japanese, and requires that the company continually strive
to be better through learning and problem solving. Because we can never achieve
perfection, we must always evaluate our performance and take measures to improve
it.

According to Bruce andM. Suzanne Brocka it is easier,
and more effective, to lift 50 pounds 10 times, than to move 500 pounds all at
once .progressive improvement is similar; small improvements done continuously reach
at the same point as a major innovation. Unlike innovation, which can require
great resources, and no small amount of serendipity, progressive improvement is
easier to manage and utilizes every one talents. Japanese companies have used
this idea for some time, and call this approach Kaizen. This idea fits hand in
hand with team building approaches such as quality circles and brain storming,
can be inexpensively managed. Richardson (1997) cited in his book

Deming recommended using a never ending, circular management
process adapted from the work of Shewart. This cyclic process, sometimes called
the Deming wheel or cycle or chain reaction. Now let’s see at the Deming cycle
that can help companies with continuous improvement: the plan – do – study –
act (PDSA) cycle.

The Plan – Do – Study – Act Cycle

The plan – do – study – act (PDSA) cycle defines the
activities a company needs to perform in order to incorporate progressive
improvement in its operation. This cycle, is also tell to as the Shewhart cycle
or the Deming wheel. The circular nature of this cycle shows that progressive
improvement is an endless process. Let’s look at the specific steps in the
cycle.

Ø 
Plan:
– is primary step in PDSA cycle. Managers must determine the current process
and make plans based on any problems they observe. They need to document all current
procedures, collect data, and identify problems. This information should then
be studied and used to develop a plan for improvement as well as specific
measures to evaluate performance.

Ø 
Do:
– The second step in the cycle is implementation of the plan (do). During the
implementationprocess managers should document all variations made and collect
data for evaluation.

Ø 
Study:
– The third step is to study the data collected in the second step. The data
are evaluated to see whether the plan is meeting the goals established in the
plan phase.

Ø 
Act:
– The last phase of the cycle is to act on the basis of the results of the
first three phases. The best way to do this is to communicate the results to
other members in the company and then put into actions the new procedure if it
has been successful.

Note that this is a cycle; the next step is to plan
again. After we have acted, we need to continue evaluating the process,
planning, and repeating the cycle again.

According to Richardson (1997) some people have
considered “progressive improvement “as being equivalent to TQM. Others
make distinctions between total continuous improvement (TCI), continuous
process improvement (CPI), and, TQM. This would imply that only TCI would
create an environment where everyone is continuously involved in the
eliminating of waste and in reduction of variation;whereas CPI might imply that
quality gains are made by improving each process.

He added that the objective of continuous improvement
is to improve processes so as to in turn continuously improve customer
satisfaction .It also implies a continuous focus on finding or measuring key
quality factors and correcting (taking action to reduce ) sources of
variability in quality and management.

Employee Empowerment

According to Richardson (1997) in the industrial
society, bosses would do the work. Today; we must accept the view that every
person at every level of the organizations knows something that can improve the
way things get done. In empowerment authority is delegated so decision can be quickly
implemented .communication is essentially in participative management.
Information must be widely delegated for use by each worker. To be effective
“managers must avoid fear”. Most employees do not speak up because of fear of
repercussions and mistrust of management. In TQM, managers are still in charge,
but they develop a true partnership with the work force. Team based, worker
empowered paradigm that heightens productivity by viewing workers as a reason of
creativity, not extension of robotic machines. Brocka,(1992).

If an organizational culture is to be transformed in
to one based on the values and norms of

TQM, top management must also be committed to employee
empowerment. Employee empowerment can be thought of as any effort designed to
move power, information, knowledge, and rewards down ward in the organization
(Business week, 1992, as cited in Lawrence, 1993).

The premise on which employee empowerment rests is a
belief in the creative energies of the people who really understand an
organization’s systems and major processes.

Several of Deming’s 14 points are designed to empower
employees AS a general rules, Deming recommends removing all barriers that rob
employees of pride and ownership in their work. He also specifically advocates
a vigorous program of employee training and self-improvement. An interesting
caveat concerning employee training is that evaluation of TQM programs suggest
that employees must be offered with detailed training and instruction in how to
do their jobs better from a TQM perspective ,because most employees believe
they are already doing the best job possible (Koons,1991,as cited in Lawrence
1993).

Process Management

The purpose of TQM is to optimize the value added
steps and minimize the cost –added steps.

Richardson (1997).According to TQM a quality product
comes from a quality process. This means that quality should be built into the
process. Quality at the source is the belief that it is far better to uncover
the source of quality problems and correct it than to discard defective items after
production. If the source of the problem is not corrected, the problem will
continue. The old concept focused on inspecting goods after they were produced
or after a particular stage of production. If an inspection revealed defects,
the defective products were either discarded or sent back for reworking. All
this cost the company money, and these costs were passed on to the customer.
The new concept of quality focuses on identifying quality problems at the
source or the process and correcting them. Lawrence (1993).

 

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