An Introduction to Quality Management

Contents

Table of figures

1 Introduction

2 Total Quality Management
2.1 Precursor of the TQM
2.1.1 Deming-Approach
2.1.2 Juran-Approach
2.1.3 Feigenbaum-Approach
2.1.4 Crosby-Approach
2.1.5 Ishikawa-Approach
2.2 The Road to TQM
2.3 The Idea of TQM
2.4 Philosophy of TQM
2.4.1 Customer-oriented
2.4.2 Employee orientation
2.4.3 Process-oriented
2.4.4 Results-oriented
2.5 Peculiarity of the TQM
2.6 Success story for the implementation of TQM
2.7 Efficiency and cost aspects of the TQM

3 Quality management system
3.1 Basic principles of QMS
3.1.1 Requirements of QMS
3.1.2 Structure of the QMS
3.2 Process-oriented QMS
3.2.1 Processes with high repetition
3.2.2 Processes with low repetition
3.3 Documentation of the QMS
3.4 Standardization and certification
3.4.1 Standardization
3.4.2 Certification
3.5 Implementation of the QMS
3.6 Integrated management system
3.6.1 The interrelation between the Environmental management and the QMS

4 Costs and benefit of the QM
4.1 Profitability analysis
4.2 Quality controlling
4.2.1 Idea and objectives
4.2.2 Functions

5 The challenge of change

Enclosures

Bibliography

Notes

Table of figures

Figure 1: Zusammenwirken von Zielen und Aufgaben; Kamiske, G.; 1998;

Figure 2: Grundpfeiler der TQM; Rothlauf J.; 2004;

Figure 3: Balanced Scorecard; Kaplan R.S., Norton D.P

Figure 4: Wirtschaftliche Vorteile des TQM; Prof. Ebel B.; 2003;

Figure 5: Betrachtungsumfang und Aufgaben eines Qualitätsmanagementsystems; Pfeifer T.; 2001;

Figure 6: Abschnitte bei der Einführung eines Qualitätsmangementsystems; Pfeifer T.;2001;

Figure 7: Auswirkungen der Qualität nach der PIMS-Studie; Buzell/Gale

1 Introduction

„Quality exists, when the price is long forgotten! “

With these words the co-founder of the tradition enterprise of Rolls Royce, Frederick Henry Royce, was quoted.

Quality ingrains the good reputation. The one who get this rep will be open the floodgates but if you lost it you go down under very fast or you have to try hard to re-establish your tattered reputation.

Quality is brainwork. Regarding to the corporate strategy quality is a typical Top-Down-Task. This strategy can only be successful when the Top-Management is disposed to put it into practice. In corporate culture thinking of quality however each co-worker is part of these one and because of that it has a typical Bottom-Up-Process characterized with a sustainable implementation.

In today's time affected by cut-throat competition and consequential customer orientation corporations attach great importance to quality.

How hard the customer penalizes quality-shortfalls a study of the White House Office of Customer Affairs impressively set forth. In these study 90 from 100 customers, who were dissatisfied with the condition of the goods will from now on avoid this product. It is remarkable that only about 4% of the dissatisfied customers complain about the quality directly to the manufacturer. Unfortunately every one of these dissatisfied customers will pass his displeasure about the quality to at least nine further potential customers.

Quality might be from existential importance for a company. In the competition still increasing in sharpness around shares of the market only the enterprises will keep up which have a integrated quality thinking and acting.^[i]

2 Total Quality Management

The understanding of quality has changed in last decades basically. While the companies were rather result-oriented till the middle of the 80s concerning the Quality management, nowadays newer Quality concepts integrate other Quality dimensions. This Total Quality Management (TQM) must be understood as a corporate strategy in which the customer takes the centre stage of the efforts.^[ii] It requires that each and every organizational function subscribes and adheres to the principles of quality development outlined firstly.^[iii]

2.1 Precursor of the TQM

Considerations how the quality of the products and processes can be improved and bundled up to a draft have a long prehistory.

2.1.1 Deming-Approach

Already after the end of the Second World War the American Deming developed a philosophy of the constant improvement of the processes. His thesis was that high product quality can not be reviewed result-orientated but can be realized exclusively by continuous improvement of the production processes.^[iv]

2.1.2 Juran-Approach

Juran stamped in 1951 with the rallying cry of "fitness for use" a new application-related quality concept. He makes a distinction between the value of the quality and the costs for quality. The one is the income effect and the other the quality costs effect. Now the enterprise management has to do the task a balance between these both effects. How this is possible Juran points in his Quality-Trilogy™.^[v]

This trilogy consists of:

Quality planning provides a system that is capable of meeting quality standards.

Quality Control is used to determine when corrective action is required.

Quality improvement seeks better ways of doing things.

2.1.3 Feigenbaum-Approach

Feigenbaum published in 1961 a Total-Quality-Control-Approach which was focused on customer demands and their fulfilment was accounted as a criterion for the regulation of the quality level.^[vi]

2.1.4 Crosby-Approach

The Crosby-Approach connected quality with the image that it is to be seen in the correspondence with the demanded requirements. He assumes with his considerations the fact that the quality problems are underrated in the enterprises concerning her value as a strategically factor of performance and therefore the companies have no quality-awareness.^[vii] He developed the four Absolutes of Quality Management™^[viii]:

Quality means conformance to requirements, not goodness.

Quality is achieved by prevention, not appraisal.

Quality has a performance standard of Zero Defects, not acceptable quality levels.

Quality is measured by the Price of Non-conformance, not indexes.

2.1.5 Ishikawa-Approach

Japanese Ishikawa demanded under the name "Company-Wide-Quality-Control" the reinforced inclusion of the employees and the society at all enterprise levels.^[ix] Basically it is very similar with the TQC from Feigenbaum. The Japanese were the first who realized this new Total-Quality-Control.

2.2 The Road to TQM

The road to TQM mirrors the inexorable move away from supplier-led approaches to the design and delivery of products and services towards recognition of the increasing power of the customer. It also reflects a important change in the way management views its role in ensuring that quality becomes a reality.^[x]

(See Figure 1)

During the early 1990s a number of companies in the United States began actively to introduce this concept of Total Quality Control or Total Quality Management. TQC or TQM are synonymous terms, the former trade-off between quality and costs in no longer imperative. Some of these companies have achieved outstanding results in improving quality, increasing market share and reducing costs. These companies have achieved world-class quality.^[xi] But the competitors, mainly in Japan, continue to improve at revolutionary rates. They have moved quickly past the amateurish belief that managing quality just means conformance to specifications and reducing the costs of poor quality.^[xii] But what was the advantage of the Japanese management thinking against the United States or Europe?

2.3 The Idea of TQM

What makes total quality management different from other management processes is the concentrated focus on continuous improvement. TQM is not a quick management fix; it is about changing the way things are done within the organization’s lifetime. The new quality understanding requires that the quality does not only remain on the products but also that the customer and his needs must be the top priority of the TQM. To have a look at the three conceptual components of TQM (see Figure 2), "Totally" stands for the inclusion of all persons involved in the added value chain, "Quality" is understood as a comprehensive specific quality orientation and the "management" stands for the action of the enterprise.^[xiii]

2.4 Philosophy of TQM

TQM stands for a corporate philosophy in which leadership of the company is completely integrated. Four basic orientation phases can be distinguished:

2.4.1 Customer-oriented

The customer is essential for the company’s business success. He only makes a decision which products or services are enough for his requirements and which not. An absolute customer orientation is necessary for companies that are on the roll. To reach this purpose the company must know the requirements and the expectations of the customers.^[xiv]

2.4.2 Employee orientation

TQM needs to recognize the engagement of all employees involved in the value-added process to find a fault as early as possible and to fix them permanently.^[xv] The focus of the efforts must be the constant improvement of all involved parties.^[xvi] The way of thinking that the staff is seen as a pure expense factor must be substituted with the integration of the employees in the business process. Employees must be seen as the determining success factor of an enterprise.^[xvii]

[...]

^[i] Cp. Pfeifer, T.; 2001; Page XXV –XXVII

^[ii] Cp. Pfeifer, T.; 2001; Page 4

^[iii] Cp. Thomas, B. 1995; Page 40

^[iv] Cp. Binner, H.; 2002; Page 31

^[v] Cp. Juran Institute, www.juran.com

^[vi] Cp. Rothlauf, J.; 2004; Page 38

^[vii] Cp. Crosby, P.; 1995; Page 53-55

^[viii] Cit. Philip Crosby Associates, Four absolutes of Quality management™, www.philipcrosby.com,

^[ix] Cp. Rothlauf, J.; 2004; Page 38

^[x]Cp. Thomas, B.; 1995; Page 37-38

^[xi]Cp. Seghezzi, H.D.; 1992; Page 4

^[xii]Cp. Seghezzi, H.D.; 1992; Page 52-53

^[xiii]Cp. Rothlauf, J.; 2004; Page 49

^[xiv]Cp. Rothlauf, J.; 2004; Page 53

^[xv]Cp. Kamiske, G.; 1998; Page 111

^[xvi]Cp. Rothlauf, J.; 2004; Page 55

^[xvii]Cp. Pfeifer, T.; 2001; Page 11