Going beyond simple productivity improvement
Thursday, 24 September 2009
Md. Touhidul Alam Khan
The basics of Total Quality Management: Total Quality Management (TQM) is the systematic activity of managing all organisations of an enterprise efficiently and contributing to the achievement of corporate goals so that quality goods and services can be provided and offered at an appropriate price at the right time. TQM has been widely used in manufacturing, education, call centres, government and service industries including banks and financial institutions, and also in NASA space and science programmes.
TQM is composed of three paradigms:
l Total: Involves the entire organisation, supply chain, and/or product life cycle.
l Quality: With its usual definitions, with all its complexities.
l Management: The system of managing with steps like planning, organising, controlling, leading the staffs, provisioning and organising.
As defined by the International Organisation for Standardisation (ISO), "TQM is a management approach for an organisation, centred on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organisation and to society." - ISO 8402:1994
In Japan, TQM comprises four processes or steps, namely:
l Kaizen: Focuses on "Continuous Process Improvement", to make processes visible, repeatable and measurable.
l Atarimae Hinshitsu: The idea is that "things will work as they are supposed to" (for example, a pen will write).
l Kansei: Examining the way the user applies the product leads to improvement in the product itself.
lMiryokuteki Hinshitsu: The idea is that "things should have an aesthetic quality" (for example, a pen will write in a way that is pleasing to the writer).
Kaizen and its origin: Kaizen is a Japanese word. "Kai" means "change" or "the action to correct" and "Zen" means "good". Kaizen ("continuous improvement") is a Japanese philosophy that focuses on continuous improvement in all aspects of life. When applied to the workplace, Kaizen activities continually improve all the functions of a business, from manufacturing to service sectors and from the CEO to the assembly line workers. By improving standardised activities and processes, Kaizen aims to eliminate waste. Kaizen was first implemented in several Japanese businesses, including Toyota, during the country's recovery after World War II and has since spread to businesses throughout the world.
Kaizen is a daily activity. Its purpose goes beyond simple productivity improvement. It is also a process that, when done correctly, humanises the workplace, eliminates overly hard work ("muri"), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. People at all levels of an organisation can participate in kaizen, from the CEO down to external stakeholders when applicable. The format for kaizen can be individual, suggestion system, small group, or large group. At Toyota, it is usually a local improvement within a workstation or a local area and involves a small group in improving their own work environment and productivity. This group is often guided through the kaizen process by a line supervisor; sometimes this is the line supervisor's key role. While kaizen (at Toyota) usually delivers small improvements, the culture of continual small improvements and standardisation yields large results in the form of compound productivity improvement. Hence, in English usage "kaizen" can be: "continuous improvement" or "continual improvement."
This philosophy differs from the "command-and-control" improvement programmes of the mid-twentieth century. Kaizen methodology includes making changes and monitoring results, then adjusting. Large-scale pre-planning and extensive project scheduling are replaced by smaller experiments, which can be rapidly adapted as new improvements are suggested.
After World War II, American occupation forces brought into Japan American experts in statistical control methods who were familiar with the training programmes of the US War Department's Training Within Industry (TWI). TWI programmes included job instruction (standard work) and job methods (process improvement). The Shewhart cycle, taught by W. Edwards Deming, and the statistics-based methods, taught by Joseph M. Juran, became the basis of the kaizen revolution in Japan that took place in the 1950s.
Quality Control (QC): Katsuya Hosotani says in his book, 'The QC Problem-Solving Approach': "Today, market needs are rapidly becoming more diversified and sophisticated. Technical innovations are arriving on the scene at a bewildering pace, and competition is becoming more and more ferocious. To ride out these successive waves of change, every company now urgently requires people with superior capacity for solving problems. Problem-solving ability is not an inborn talent possessed by only a few special people. It is the cumulative result of individual acts and is moulded and improved through repeated experience and study."
In fact, solving problems in the areas of maintaining and improving quality (Q), reducing costs (C), observing deadline and production volumes delivery (D), securing safety (S), improving motivation and morale (M) and protecting the environment (E) are the essence of Total Quality Management (TQM). Every company sets up an organisation composed of structural units such as divisions, sections, and groups. Under the usual system, workplace leader is appointed to head each of these organisational units. Each manager and supervisor of the unit are referred to the workplace leader. A workplace leader is someone who has the role of managing a number of people in order to achieve certain objectives within an organisation, ensuring that each individual exercises his or her full potential, and creating a workplace where everybody works together willingly to achieve results and where each person can find satisfaction in his or her work. To achieve this, workplace leaders are given the authority they require to perform their duties and must take responsibility for fulfilling their appointed role.
Quality-first: Quality is the overall inherent feature and performance subject to the evaluation of determining if the product or service satisfies the purpose of the use. 'Quality-first' means putting quality above everything else in order to create highly satisfactory goods and services of guaranteed quality that customers will be attracted to buy and delighted to use. It is a philosophy of giving priority to improving quality and giving it pride of place before sales, costs, productivity or better services to the customers. The strategies for 'Quality-first' are:
l Develop complex, highly original, new technology.
l Unearth the latent wants and needs of the marketplace and develop new types of products that will stimulate fresh demand and create new markets.
l Improve and control processes to eliminate defects, and produce products that will function as nearly perfectly as possible.
QC is a practice that promotes the concepts of 'quality-first' and 'customer-first,' in order to produce products and deliver services from their recipients' perspectives. In daily work, these concepts translate into the principle, "the next processes are our customers." When everyone in a company practises this principle, the walls between departments and the executives & employees are removed and communication in the organisation becomes smoother and people then discuss matters based on facts and data.
The writer, the Executive Vice President and Head of Syndications and Structured Finance, Prime Bank, attended the Programme on Quality Management for Bangladesh and Nepal (BNQM) which was organised by AOTS and held at Tokyo, Japan from November 24 to December 05, 2008. He can be reached at touhid1969@gmail.com. The second part of this write-up will appear on Sunday next
The basics of Total Quality Management: Total Quality Management (TQM) is the systematic activity of managing all organisations of an enterprise efficiently and contributing to the achievement of corporate goals so that quality goods and services can be provided and offered at an appropriate price at the right time. TQM has been widely used in manufacturing, education, call centres, government and service industries including banks and financial institutions, and also in NASA space and science programmes.
TQM is composed of three paradigms:
l Total: Involves the entire organisation, supply chain, and/or product life cycle.
l Quality: With its usual definitions, with all its complexities.
l Management: The system of managing with steps like planning, organising, controlling, leading the staffs, provisioning and organising.
As defined by the International Organisation for Standardisation (ISO), "TQM is a management approach for an organisation, centred on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organisation and to society." - ISO 8402:1994
In Japan, TQM comprises four processes or steps, namely:
l Kaizen: Focuses on "Continuous Process Improvement", to make processes visible, repeatable and measurable.
l Atarimae Hinshitsu: The idea is that "things will work as they are supposed to" (for example, a pen will write).
l Kansei: Examining the way the user applies the product leads to improvement in the product itself.
lMiryokuteki Hinshitsu: The idea is that "things should have an aesthetic quality" (for example, a pen will write in a way that is pleasing to the writer).
Kaizen and its origin: Kaizen is a Japanese word. "Kai" means "change" or "the action to correct" and "Zen" means "good". Kaizen ("continuous improvement") is a Japanese philosophy that focuses on continuous improvement in all aspects of life. When applied to the workplace, Kaizen activities continually improve all the functions of a business, from manufacturing to service sectors and from the CEO to the assembly line workers. By improving standardised activities and processes, Kaizen aims to eliminate waste. Kaizen was first implemented in several Japanese businesses, including Toyota, during the country's recovery after World War II and has since spread to businesses throughout the world.
Kaizen is a daily activity. Its purpose goes beyond simple productivity improvement. It is also a process that, when done correctly, humanises the workplace, eliminates overly hard work ("muri"), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. People at all levels of an organisation can participate in kaizen, from the CEO down to external stakeholders when applicable. The format for kaizen can be individual, suggestion system, small group, or large group. At Toyota, it is usually a local improvement within a workstation or a local area and involves a small group in improving their own work environment and productivity. This group is often guided through the kaizen process by a line supervisor; sometimes this is the line supervisor's key role. While kaizen (at Toyota) usually delivers small improvements, the culture of continual small improvements and standardisation yields large results in the form of compound productivity improvement. Hence, in English usage "kaizen" can be: "continuous improvement" or "continual improvement."
This philosophy differs from the "command-and-control" improvement programmes of the mid-twentieth century. Kaizen methodology includes making changes and monitoring results, then adjusting. Large-scale pre-planning and extensive project scheduling are replaced by smaller experiments, which can be rapidly adapted as new improvements are suggested.
After World War II, American occupation forces brought into Japan American experts in statistical control methods who were familiar with the training programmes of the US War Department's Training Within Industry (TWI). TWI programmes included job instruction (standard work) and job methods (process improvement). The Shewhart cycle, taught by W. Edwards Deming, and the statistics-based methods, taught by Joseph M. Juran, became the basis of the kaizen revolution in Japan that took place in the 1950s.
Quality Control (QC): Katsuya Hosotani says in his book, 'The QC Problem-Solving Approach': "Today, market needs are rapidly becoming more diversified and sophisticated. Technical innovations are arriving on the scene at a bewildering pace, and competition is becoming more and more ferocious. To ride out these successive waves of change, every company now urgently requires people with superior capacity for solving problems. Problem-solving ability is not an inborn talent possessed by only a few special people. It is the cumulative result of individual acts and is moulded and improved through repeated experience and study."
In fact, solving problems in the areas of maintaining and improving quality (Q), reducing costs (C), observing deadline and production volumes delivery (D), securing safety (S), improving motivation and morale (M) and protecting the environment (E) are the essence of Total Quality Management (TQM). Every company sets up an organisation composed of structural units such as divisions, sections, and groups. Under the usual system, workplace leader is appointed to head each of these organisational units. Each manager and supervisor of the unit are referred to the workplace leader. A workplace leader is someone who has the role of managing a number of people in order to achieve certain objectives within an organisation, ensuring that each individual exercises his or her full potential, and creating a workplace where everybody works together willingly to achieve results and where each person can find satisfaction in his or her work. To achieve this, workplace leaders are given the authority they require to perform their duties and must take responsibility for fulfilling their appointed role.
Quality-first: Quality is the overall inherent feature and performance subject to the evaluation of determining if the product or service satisfies the purpose of the use. 'Quality-first' means putting quality above everything else in order to create highly satisfactory goods and services of guaranteed quality that customers will be attracted to buy and delighted to use. It is a philosophy of giving priority to improving quality and giving it pride of place before sales, costs, productivity or better services to the customers. The strategies for 'Quality-first' are:
l Develop complex, highly original, new technology.
l Unearth the latent wants and needs of the marketplace and develop new types of products that will stimulate fresh demand and create new markets.
l Improve and control processes to eliminate defects, and produce products that will function as nearly perfectly as possible.
QC is a practice that promotes the concepts of 'quality-first' and 'customer-first,' in order to produce products and deliver services from their recipients' perspectives. In daily work, these concepts translate into the principle, "the next processes are our customers." When everyone in a company practises this principle, the walls between departments and the executives & employees are removed and communication in the organisation becomes smoother and people then discuss matters based on facts and data.
The writer, the Executive Vice President and Head of Syndications and Structured Finance, Prime Bank, attended the Programme on Quality Management for Bangladesh and Nepal (BNQM) which was organised by AOTS and held at Tokyo, Japan from November 24 to December 05, 2008. He can be reached at touhid1969@gmail.com. The second part of this write-up will appear on Sunday next