Total Quality Management

1. Total Quality Management Week # 4 Leadership, Commitment, & Strategy Prepared by: Khalid Dahleez Faculty of Commerce – the Islamic University of Gaza This material was collected from different sources Total Quality Management - Spring 2010

2. Total Quality Management Model – major features Teams Culture Process Customer Supplier Communication Systems Tools Commitment Total Quality Management - Spring 2010

3. The total quality management approach • What is quality management? ‘something that is best left to the experts’  wrong answer • Quality cannot be achieved on a company-wide basis if it is left to the experts. • Using the traditional control techniques is NOT the way to achieve quality. • Quality is not the responsibility of the QC or QA departments only. • TQM is far more than shifting the responsibility of detection of problems from the customer to the producer. Total Quality Management - Spring 2010

4. The total quality management approach • TQM requires a comprehensive approach that must first be recognized and then implemented. • Today, managers must plan strategically to maintain a hold on market share, let alone increase it. • Consumers choice quality or price? • TQM is an approach to improving the competitiveness, effectiveness and flexibility of a whole organization. • For an organization to be truly effective, each part of it must work properly together towards the same goals. Total Quality Management - Spring 2010

5. The total quality management approach • The methods and techniques used in TQM can be applied throughout any organization (manufacturing, public service, health care, education and hospitality industries). • Toward TQ, management must focus on developing a problem-prevention mentality. • Many people will need to undergo a complete change of ‘mindset’. • The correct mindset may be achieved by looking at the sort of barriers that exist in key areas. Total Quality Management - Spring 2010

6. The total quality management approach • Staff will need to be trained and shown how to reallocate their time and energy to studying their processes in teams, searching for causes of problems, and correcting the causes, not the symptoms a positive management. • The managements of many firms may think that their scale of operation is not sufficiently large, that their resources are too slim. Total Quality Management - Spring 2010

7. Quality Assessment - Questions Managers should examine the existing quality performance by asking the following questions: • Is any attempt made to assess the costs arising from errors, defects, waste, customer complaints, lost sales, etc? • Are the organization’s quality systems-documentation, procedures, operations etc-in good order? • Have personnel been trained in how to prevent errors and quality problems? • What is being done to motivate and train employees to do work right first time? Total Quality Management - Spring 2010

8. Quality Assessment - Questions • If satisfactory answers given to most of these questions an organization in the way to using quality procedures and management. • If answers to the previous questions indicate problem areas, it will be beneficial to review the top management’s attitude to quality. • Time and money spent on quality-related activities are not limitations of profitability. Total Quality Management - Spring 2010

9. Ten Points for Senior Management – TQM Foundation • The Organisation needs long term commitment to constant improvement. • Adopt the philosophy of zero errors/defects to change the CULTURE to right first time. • Train the people to understand the CUSTOMER-SUPPLIER relationship. • Do not buy products or services on price alone. Look at the TOTAL cost. • Recognize that improvement of the SYSTEM needs to be managed. • Adopt modern methods of SUPERVISION and TRAINING – eliminate fear. Total Quality Management - Spring 2010

10. Ten Points for Senior Management – TQM Foundation • 7. Eliminate Barriers between departments by managing the PROCESS – improve COMMUNICATION and TEAMWORK. • 8. Eliminate the following: • Arbitrary goals without methods, • All Standards based only on numbers, • Barriers to pride of workmanship, • Get FACTS by Using the correct TOOLS. • 9. Constantly educate and retrain – develop the EXPERTS in the business • 10. Develop a SYSTEMATIC approach to manage the implementation of TQM. Total Quality Management - Spring 2010

11. Leadership as a Major Component of TQM Teach & Institute Leadership - Deming • Leadership is management’s job. • Most managers/supervisors do not truly know (how to perform) the duties of the employees they supervise. Three Steps to Quality - A.V. Feigenbaum • Quality Leadership, with a strong focus on planning • Modern Quality Technology, involving the entire work force • Organizational Commitment, supported by continuous training and motivation Leadership can’t be delegated - Juran Total Quality Management - Spring 2010

12. Leadership as a Major Component of TQM • One of the main categories of Malcolm Baldrige National Quality Award (leadership – 125 points) • EFQM Model (Leadership – 10%) • ISO 9000 Quality Management Principles (leadership & people involvement) • British Model (TQM, combined with effective leadership, results in an organization doing the right things, first time) Total Quality Management - Spring 2010

13. Leadership as a Major Component of TQM • Leaders must have (Yoshio Kondo) • a dream (vision and shared goals) • strength of will and tenacity of purpose • ability to win the support of followers • ability to do more than their followers,without interfering when they can do it alone • successes • ability to give the right advice Total Quality Management - Spring 2010

14. Leaders establish unity of purpose, direction, and internal environment of the organization. They create the environment in which people can become fully involved in achieving the organization´s objectives. The ability of top management to establish, practice, and lead a long-term vision for the firm, driven by changing customer requirements, as opposed to an internal management control role. Lack of top management commitment is one of the reasons for the failure of TQM efforts (Brown et al. 1994). A predominant requirement for quality management is that strong commitment from top management is vital. To be an effective leader in most modern firms, the top manager must continue to develop and learn. Leadership & Commitment Total Quality Management - Spring 2010

15. Leadership & Commitment • Knowledge of the business and continual learning are essential prerequisites to effective leadership (DuBrin, 1995). • In order to effectively lead the firm, top management must be committed to provide education and training to employees and regarding them as valuable resources of the firm. • Top management must be committed to allocating sufficient resources to prevent, as well as repair, quality problems. • Top management should discuss quality frequently; by having session on the topic and asking questions about quality at every staff meeting. • Top management must train and coach employees to assess, analyze, and improve work processes (Deming, 1986). Total Quality Management - Spring 2010

16. Characteristics of excellent leadership - Dr. Curt Reimann, director of the Malcolm Baldrige National Quality Award • Visible, committed, and knowledgeable — They promote the emphasis on quality and know the details and how well the company is doing. Personal involvement in education, training, and recognition. Accessible to and routine contact with employees, customers, and suppliers. • A missionary zeal — The leaders are trying to effect as much change as possible through their suppliers, through the government, and through any other vehicle that promotes quality. They are active in promoting quality outside the company. • Aggressive targets — Going beyond incremental improvements and looking at the possibility of making large gains, getting the whole work force thinking about different processes — not just improving processes. Total Quality Management - Spring 2010

17. Characteristics of excellent leadership - Dr. Curt Reimann, director of the Malcolm Baldrige National Quality Award • Strong drivers — Cycle time, zero defects, six sigma, or other targetsto drive improvements. Clearly defined customer satisfaction andquality improvement objectives. • Communication of values — Effecting cultural change related toquality. Written policy, mission, guidelines, and other documentedstatements of quality values, or other bases for clear and consistentcommunications. • Organization — Flat structures that allow more authority at lowerlevels. Empowering employees. Managers as coaches rather thanbosses. Cross-functional management processes and focus on internalas well as external customers. Interdepartmental improvement teams. • Customer contact — CEO and all senior managers are accessibleto customers. Total Quality Management - Spring 2010

18. Good Leaders • Give priority attention to customers and their needs • Empower, rather than control, subordinates. • Emphasize improvement rather than maintenance. • They emphasize prevention. • Encourage collaboration rather than competition. • They train and coach, rather than direct and supervise. Total Quality Management - Spring 2010

19. Good Leaders • Learn from problems. • They continually try to improve communications. • They continually demonstrate their commitment to quality. • Choose suppliers on the basis of quality, not price. • Establish organizational systems to support the quality effort. • Encourage and recognize team effort. Total Quality Management - Spring 2010

20. Role of TQM leaders • All are responsible for quality improvement especially the senior management & CEO’s • Ensure that the team’s decision is in harmony with the quality statements of the organization • Senior TQM leaders must read TQM literature and attend conferences to be aware of TQM tools and methods • Senior managers must take part in award and recognition ceremonies for celebrating the quality successes of the organization • Coaching others and teaching in TQM seminars • Senior managers must liaise with internal ,external and suppliers through visits, focus groups, surveys • They must live and communicate TQM. Total Quality Management - Spring 2010

21. Effective leadership • Effective leadership starts with the Chief Executive’s vision, capitalizing on market or service opportunities, continues through a strategy that will give the organization competitive advantage, and leads to business or service success. • Together, effective leadership and TQM result in the company or organization doing the right things, right first time. • The five requirements for effective leadership are the following: Total Quality Management - Spring 2010

22. Effective leadership • Developing and publishing clear documented corporate beliefs and objectives – a mission statement The beliefs and objectives should address: • The definition of the business. • A commitment to effective leadership & Quality • Target sectors and relationships with customers. • Indications for future direction. (principal plans) • Commitment to monitoring performance against customers' needs and expectations, and continuous improvement. • Developing clear and effective strategies and supporting plans for achieving the mission and objectives. Total Quality Management - Spring 2010

23. Effective leadership • Identifying the critical success factors and critical processes. • Reviewing the management structure • Empowerment – encouraging effective employee participation particular attention must be paid to the following: • Attitudes • The key attitude for managing any winning organization may be expressed as “I will personally understand who my customers are and what are their needs and expectations of me”. • This attitude must start at the top, then it must percolate down to be adopted by every employee. Total Quality Management - Spring 2010

24. Effective leadership • Abilities • Every employee must be able to do what is needed and expected of him or her. • Training and its effectiveness • Participation • For effective employees participation in making the company or organization successful, employees must be trained to: E Evaluate – the situation and define their objectives. P Plan – to achieve those objectives fully. D Do, implement the plans. C Check – that the objectives are being achieved. A Amend, take corrective action if they are not. Total Quality Management - Spring 2010

25. Leadership: Guiding the Organization in the Pursuit of Excellence: Key Issues • Are leaders actively engaged in campus activities? • Are leaders actively engaged with public, professional, and/or academic groups? • Is the leadership and governance structure clearly defined and understood? • Are senior leaders effective role models? • Do leaders promote leadership at all levels? • Are leadership goals established? • Are there informal and formal methods for reviewing leadership and governance effectiveness throughout the organization? • Are ethics and integrity emphasized? • Are the organization’s pertinent legal and regulatory risks and issues addressed? • Do leaders encourage public responsibility and attention to the organization’s impact on the physical and social environment? Total Quality Management - Spring 2010

26. Leadership benefits • for policy and strategy formulation, establishing and communicating a clear vision of the organisation's future; • for goal and target setting, translating the vision of the organisation into measurable goals and targets; • for operational management, empowered and involved people achieve the organisation's objectives; • for human resource management, having an empowered, motivated, well informed and stable workforce. Total Quality Management - Spring 2010

27. LEADERSHIP FOR INSPIRING CHANGE IN QUALITY • Why leadership for change? • Eighty per cent of TQM initiatives fail because they do not have the backing of the senior management. • Commitment is the foundation of an effective TQM initiative. • Leadership is the key in promoting commitment. • Leadership and commitment go hand in hand. • TQM needs leaders who are committed to change. • Leadership for Total Quality - Total quality is defined as “performance leadership in meeting customer requirements by doing the right the first time.” Total Quality Management - Spring 2010

28. Change Leadership • The most challenging aspect of business is leading and managing change • The business environment is subject to fast-paced economic and social change • Modern business must adapt and be flexible to survive • Problems in leading change stem mainly from human resource management • Leaders need to be aware of how change impacts on workers Total Quality Management - Spring 2010

29. Leadership in TQM Role Model TRANSFORMATIONAL LEADERS VERSUS TRANSACTIONAL MANAGERS: Transformational leaders: They provide mission for others to follow and they expect the same high standards from their people. They are interested in ‘ends’ rather than ‘means’. Transactional managers: They are good at achieving short-term results, foster teamwork and work in a practical manner. Evidently, transformational leaders and transactional managers need to work together. Total Quality Management - Spring 2010

30. Leadership Characteristics Jim Collins, “Good To Great” • Level One • Highly capable • Contributes through talent, knowledge, skills, and good work habits • Level Two • Team member • Contributes individual capabilities to the group and works effectively with others • Level Three • Competent manager • Organizes people and resources toward the effective and efficient pursuit of predeterminedobjectives Total Quality Management - Spring 2010

31. Leadership Characteristics Jim Collins, “Good To Great” • Level Four • Catalyst leader • Makes a commitment to and vigorous pursuit of a clear and compelling vision, stimulating higher performance standards • Level Five • Executive leader • Builds enduring greatness through a paradoxical blend of personal humility and professional will Total Quality Management - Spring 2010

32. How all leaders drive the organisation towards a position of Business Excellence Give & Receive Training Develop Goals Communicate Effectively Leadership Recognition Make Themselves Accessible Listen & Respond to People Total Quality Management - Spring 2010

33. Comparison of Traditional Management and TQM Total Quality Management - Spring 2010

34. STRATEGY AND THE STRATEGIC PLANNING PROCESS • Evidence suggests that those companies with strategies based on TQM have achieved stunning successes. • Most of these successful companies will attribute their progress to a quality-based strategy that was developed through a formal structured approach to planning. • Total Quality begins with a strategic decision — a decision that can only be made by top management — and that decision, simply put, is the decision to compete as a world-class company. Total Quality concentrates on quality performance — in every facet of the business — and the primary strategy to achieve and maintain competitive advantage. It requires taking a sys‑tematic look at an organization — looking at how each part interrelates to the whole process. In addition, it demands con­tinuous improvement as a “way of life.” Total Quality Management - Spring 2010

35. STRATEGY AND THE STRATEGIC PLANNING PROCESS Professors Andrews, Christensen, and others in the Policy group at the Harvard Business School argue that corporate strategy is the pattern of decisions in a company that: • determines, shapes, and reveals its objectives, purposes, or goals; • produces the principal policies and plans for achieving these goals; and • defines the business the company intends to be in, the kind of economic and human organization it intends to be, and the nature of the economic and non eco­nomic contribution it intends to make to its shareholders, employees, customers, and communities. Total Quality Management - Spring 2010

36. STRATEGY AND THE STRATEGIC PLANNING PROCESS • Michael Porter describes the development of a competitive strategy as “a broad formula for how a business is going to compete, what its goals should be, and what policies will be needed to carry out those goals.” • Strategic Planning is a deliberate process used by organizations to develop a mission, vision, guiding values, strategic objectives, and specific strategies for achieving the objectives. Total Quality Management - Spring 2010

37. Strategic Planning Strategic business planning is similar to strategic quality planning. 7 steps to strategic planning • Customer needs • Customer positioning • Predict the future • Gap analysis • Closing the gap • Alignment • Implementation Total Quality Management - Spring 2010

38. TQM - Strategy Approach • an approach to improving the competitiveness, effectiveness and flexibility of a whole organisation..... a way of planning, organising and understanding each activity and it depends on each individual at each level. TQM is a way of ...... bringing everyone into the processes of improvement (Oakland 1995) • a TQM programme promotes "quality" as a strategic imperative. Comprehensive TQM programme requires re-evaluation how organisational members address the quality of their work and production /service processes. Total Quality Management - Spring 2010

39. TQM supported by policy commitment • culture & practice • change strategy & organisational renewal • injection of energy • staff encouraged to practice positive, initiative taking behaviours • a prevention ethic • quality improvement teams/circles • use of methods and techniques (tools) Total Quality Management - Spring 2010

40. Customers Suppliers The organisations mission, values, strategic direction & the manner in which it achieves them Employees Use Appropriate Information Legislation Benchmarking Competitors Set Targets Communicate to all Strategy & Planning Review & Improve Develop Changes Check Understanding Total Quality Management - Spring 2010

41. Determine strategic intent Define organizational mission Analyze environment Set objectives Determine requirements Assess resources Develop action plans Implement plans Monitor outcomes Strategic Management Process Strategic Planning Feedback Total Quality Management - Spring 2010

42. FACTORS DETERMINING COMPETITIVE STRATEGY STRENGTHS & WEAKNESSES OPPORTUNITIES & THREATS Factors External to the Company Factors Internal to the Company COMPETITIVE STRATEGY PERSONAL VALUES BROADER SOCIETAL EXPECTATIONS Total Quality Management - Spring 2010

43. Objective Setting through SWOT SWOT ANALYSIS Internal Strengths Weaknesses External Opportunities Threats SW OT Total Quality Management - Spring 2010

44. STRATEGIC PLANNING PROCESS (major questions) Following a SWOT analysis, the strategic plan will involve a process to search for the answers to the following questions: • Who are we? • What are we known for? • What do we do better than 90% of our competitors? • What do our competitors beat us on? • What do we wish to be known for? • Where are we headed as an organization? • Where do we wish to be headed? • How would we get there? • What would it take to get us there? Total Quality Management - Spring 2010

45. Components of Strategy The major role that quality plays in strategic planning can best be understood by examining the components of a strategy: • Mission, vision, and guiding values • Product/market scope • Competitive edge (differentiation) • Supporting policies • Objectives • Organizational culture Total Quality Management - Spring 2010

46. Quality statements Besterfield • The quality statements include the vision statement, mission statement, and quality policy statement. • Once developed, they are only occasionally reviewed and updated. They are part of the strategic planning process. • There may be considerable overlap among the three statements. Total Quality Management - Spring 2010

47. Quality statements Total Quality Management - Spring 2010

48. Quality Statements • Vision statement :is the declaration of what an organization should look like five to ten years in the future. • Mission statement : answers the questions that who we are ,who are the customers ,what we do and how we do it. This statement is usually one paragraph or less in length ,is easy to understand and describes the function of the organization. • Quality policy statement : is a guide for everyone in the organization as to how they should provide products and service to the customers It should be written by CEO with feed back from work force and be approved by quality council. Total Quality Management - Spring 2010

49. STRATEGIC QUALITY MANAGEMENT (Environment) Environment • The major determinant of a mission is the environment in which the firm plans to operate: the general environment, the industry environment, and the competitive environment. Strategy is essentially the process of posi­tioning oneself in that environment as trends and changes unfold. Thus, it is necessary to identify trends in the environment and how they affect the strategy of the firm. Total Quality Management - Spring 2010

50. STRATEGIC QUALITY MANAGEMENT Product/Market Scope • This answers the questions: What am I selling and to whom am I selling it? The answers are more complex than they appear. • in today’s heightened competitive environment, a product or service is not simply sold to anyone who will buy it. • To be effective, value must be sold to a particular market or customer segment. • Strategic planning involves the determination of these strategy components, and quality plays a major role in this process. Total Quality Management - Spring 2010