Quality Management

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Total Quality Management

Total Quality Management (TQM) is based on the premise that quality improvement is the responsibility of all employees involved in the creation of products and services. TQM is characterized by massive training to all employees with basic tools to identify and remove the causes of errors and defects in products and services for the purpose of meeting or exceeding customer expectations. The concepts of TQM were embraced by such notables as Deming, Juran, Ishikawa, and Taguchi.

The precepts, or core values, of TQM are often described as:

  • Total Employee Engagement   all employees participate in work designed to identify defects, their root causes, and to take the appropriate actions to eliminate and/or reduce those defects necessary to achieve customer expectations.
  • Process Oriented   a fundamental precept in TQM is a focus on process, a process of converting inputs from suppliers (whether they are internal or external) and converting those inputs into outputs consumed by customers. Performance measures are defined and continuously monitored to ensure quality during the conversion process.
  • Continuous Improvement   a major objective of TQM is the continuous improvement in the process necessary to meet ever-growing demands and/or expectations of customers.
  • Fact-Based Decision Making   performance data on the production of products or the delivery of services are necessary for decision-making related to quality improvement.

Six Sigma

Six Sigma is an extension, or the next step beyond TQM and is more fact-driven and data intensive than TQM. Six Sigma employs a set of tools and techniques that go beyond the capabilities achieved by TQM for reducing and/or eliminating variations in processes that transform inputs to outputs consumed by either internal or external customers. Six Sigma (6σ) is much more quantitative through the use of statistical and other numerically based techniques used to search out the causes of defects and variations in processes that affect quality. Unlike TQM, which is built on the premise that quality is the responsibility of all employees to identify and resolve defects, 6σ relies on a hierarchy of highly-trained specialists in the many complex statistical tools and techniques used to search out defects that are caused by variations in processes – “Champions,” “Master Black Belts,” “Black Belts,” “Green Belts,” etc. who are trained in many of the complex tools employed in Six Sigma.

The term Six Sigma is derived from terminology related to manufacturing that represents products that are produced free of defects at a rate of 3.4 defects per million opportunities, so the term Six Sigma or, 6σ, has become to byword for achieving an extremely high watermark for defect free production. However, tools associated with manufacturing do not easily lend themselves to the unique processes associated with knowledge work performed in more service-oriented businesses and therefore is somewhat less effective.

Lean Management

Lean Management is what it sounds like – performing in a more streamlined fashion that produces much less waste, steps in the process, movement, defects, errors and the like. But it goes much further by eliminating the steps and resources that do not add value to the end product or service. Just-In-Time manufacturing is an example of a Lean manufacturing philosophy. Lean is all about achieving the end result with as little waste (materials, time, defect, costs, etc.) as possible. Lean is less structured and does not utilize as many complex mathematical tools and techniques but remains dedicated to achieving waste-free processes that speeds processing while maximizing customer value.

Lean utilizes a set of tools used to identify waste (Muda) based on the philosophy that as waste is eliminated, quality is improved while process costs are reduced – less waste, less cost. Lean uses numerous tools such as Value Stream Mapping, Total Predictive Maintenance, redesigning of work cells, Five S (Sort, Set in order, Shine, Standardize, and Sustain) , muda (overproduction, waiting, transporting, unnecessary inventory, unnecessary motion/processing, rework, and defects), etc. to identify and remove waste. Similar to Six Sigma, the tools were developed to meet the needs of manufacturing organizations and may not adapt well to service organizations or service functions with manufacturing. For example, performance of value-added activities, by inappropriate or unqualified employees is waste and is often missed during most Lean initiatives.

Lean Six Sigma

The demarcation between Lean Management and Six Sigma has become somewhat blurred and the blending of both methodologies have been termed Lean Six Sigma. Lean Six Sigma strives for the elimination of waste (muda) while producing goods and services at a rate of 3.4 defects per million opportunities. The combination makes practical sense in that reducing waste will contribute to fewer defects, higher quality, and more satisfied customers.

The difference between Lean Management and Six-Sigma is that Six Sigma may use a sledgehammer or complex tool to improve a process when only a simple Lean tool could be employed. Similarly, a more powerful statistical analysis from Six Sigma may be required to achieve a Lean outcome. In either case, the two methodologies may work in concert to achieve the desired results.

MRT's Role in Quality Management

The four quality-improvement methodologies described previously were developed from manufacturing applications and oftentimes have limited application in service industries and/or the service sectors within manufacturing. Therefore, there have been a number of difficulties reported when applying these methodologies to service-oriented environments such as, but not limited to, the following:

  • Lack of management involvement and commitment – it won’t work here
  • Project selection based on “squeaky wheel” and/or intuition – lack of adequate diagnostics – not related to strategic objectives
  • Focuses on peripheral processes rather than core customer value-generating results (e.g., pricing, compensation, organizational structure, etc.)
  • Lack of “buy-in” or engagement of affected areas – conflicts with vested interests
  • Inadequate information regarding issues, costs, etc.
  • Financial results don’t flow to bottom line – lack of traceability Results take too long to materialize (lack of dedicated resources, scope creep, etc.) – tries management’s patience
  • Lack of integration of information from multiple sources (customers, employees, vendors, shareholders, etc.)
  • Over-extended staff, duplication of effort, conflicting objectives, etc.
  • Inability to “dislodge the status quo” – resistance to change

MRT’s role is to first conduct a comprehensive organizational diagnostic evaluation using our flagship AVM® methodology to identify the most opportune areas for applying these technologies. Although AVM® is a performance-improvement tool, it lends itself as a diagnostic tool to magnify the results of a number of improvement initiatives as described earlier – optimizing rather than maximizing the investment in these initiatives.

For example, after a client suffered some significant financial setbacks, they invested several millions in Six Sigma training that produced little, if any, bottom-line results. After employing AVM®, numerous opportunities were identified which were provided to Six Sigma teams and various taskforce teams for implementation that generated well over $30 million in direct financial improvements accompanied by over $40 million in revenue enhancements.

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