What is pareto analysis? Give an example of
how it can be used.
List and describe the major quality
Cause and effect
Check Sheet
Pareto Analysis
Run Charts/Control Charts
Scatter diagrams
List and explain 5 reasons why continual
improvement is important
– It is fundamental to success in a global
– Maintaining the status quo is like standing
still in a race
– Customers need change
– Innovation today is routine tomorrow
– A bargain today is high priced tomorrow
List and explain the two types of variation
Explain the importance of the normal
distribution in process control
List and explain the key elements of total
Customer focus
Obsession with Quality
Scientific Approach
Long-term commitment
Education and training
Freedom through control
Unity of purpose
Employee Involvement
Explain why the implementation of total
quality requires cultural change
– Change can not occur in a hostile
– Moving to Total Quality takes time
– It can be difficult to overcome the past
List and explain 6 essential continual
improvement activities
Maintain communication
Correct obvious problems
Look upstream
Quality improvement is not putting out fires
Document problems and progress
Monitor change
Two Views of Quality
Defective parts per hundred
Detection of problems
Finished product inspection
Passive employees who (blindly)
follow orders
Short term profits
Productivity & quality in conflict
Meeting customer specifications
Establishing acceptable levels of
Quality is inspected in
Defects are to be expected
Quality is a separate function or
Employees blamed for poor
Page 11
Supplier relationships are short
lived & cost driven
Total Quality
Defective parts per million
Prevention of problems
Continual improvement
Employees empowered to think and
recommend improvements
Long term profits
Productivity gains are made as a
result of Quality improvements
Exceeding customer expectations
Establishing benchmarks for customer
satisfaction & continually improving
Quality is achieved by product &
process design & effective control
Defects are to be prevented
Quality should be fully intergrated –
it’s everybody’s responsibility
85% of quality problems are
management’s fault
Supplier relationships are long term
and quality driven
W. Edward Deming Fourteen
1."Create constancy of purpose towards improvement".
Replace short-term reaction with long-term planning.
2."Adopt the new philosophy".
The implication is that management should actually adopt his
philosophy, rather than merely expect the workforce to do so.
3."Cease dependence on inspection".
If variation is reduced, there is no need to inspect manufactured
defects, because there won't be any.
items for
4."Move towards a single supplier for any one item."
Multiple suppliers mean variation between feedstocks.
5."Improve constantly and forever".
Constantly strive to reduce variation.
6."Institute training on the job".
If people are inadequately trained, they will not all work the same way, and this
will introduce variation.
7."Institute leadership".
Deming makes a distinction between leadership and mere supervision.
The latter is quota- and target-based.
Page 20
W. Edward Deming Fourteen
8."Drive out fear".
Deming sees management by fear as counter- productive in the long
term, because it prevents workers from acting in the organization's best
9."Break down barriers between departments".
Another idea central to TQM is the concept of the 'internal customer',
that each department serves not the management, but the other
departments that use its outputs.
10."Eliminate slogans".
Another central TQM idea is that it's not people who make most
mistakes - it's the process they are working within. Harassing the
workforce without improving the processes they use is counterproductive.
11."Eliminate management by objectives".
Deming saw production targets as encouraging the delivery of poorquality goods.
12."Remove barriers to pride of workmanship".
Many of the other problems outlined reduce worker satisfaction.
13."Institute education and self-improvement".
14."The transformation is everyone's job".
Page 20
Common errors made when
starting quality initiatives
Senior management delegation & poor leadership
– Can not delegate leadership to the Quality department or an outside
Team mania
– Teams will need to be established, but the approach needs to be
learned. Teams will only be effective when a cultural change takes place
The deployment process
– It can not be a directive from “the top”. Plan must be made for
integration of the TQ principals into the organization and for the
necessary cultural change
A narrow, dogmatic approach
– Organizations need to tailor TQ to their individual needs. They can not
simply take the Demming approach or the Juran approach, they need to
take from all the models and get the best fit for their organization
Confusion about the differences among education, awareness, inspiration,
and skill building
– Training and skill building are two different things. Training can be done
over a short period of time; skill building takes not only time but a
cultural change to foster that growth.
Page 27
The Relationship between Quality
and Competitiveness
• The relationship between quality and
competitiveness can be summarized as follows:
In a modern global marketplace, quality is the
key to competitiveness.
How does Quality help an organization to
become competitive?
Page 44
The cost of Quality
• “traditional” attitude is that there is a cost to quality
• Quality is a “support” function; does not contribute
directly to manufacturing and so is often one of the
first functions to go in hard times
When TQ is integrated as a normal part of business,
it contributes directly to manufacturing and is
actually an important tool to avoid hard times
Competitiveness and the U.S.
• Ability to compete globally has direct impact on
quality of life
• Ability to compete depends upon the ability to do a
better job of producing goods
• To do a better job producing goods nations and
organizations need to focus on policies, systems and
resources in a coordinated way to continually
Pg 47
Competitiveness and the U.S.
• Many industrialized nations have taken steps to link
education, economics and labor market policy to
promote competitiveness
• The U.S. is still debating the need for a national
industrial policy and a national education policy
• 1980s – U.S. improved productivity by putting more
people to work – other nations improved productivity by
making the worker more efficient
• 2000 to 2010 – the number of U.S. workers is on the
decline to maintain productivity U.S. workers must
become more efficient
Pg 48
Factors Inhibiting Competitiveness
Business and government
• Emphasis on short-term profits fed by fear of
unfriendly takeover attempts and pressure from
lenders or shareholders (2)
• Excessive medical costs (6)
• Excessive costs of liability inflated by lawyers
working on contingency fees (7)
Pg 49
Factors Inhibiting
• The family unit is the nation’s most important human
resource development agency
• Single parents who must work full time jobs have
little or no time to help their children excel in school
• Parents who must work more than one job have little
or no lime to help their children excel in school
• Children with parents who do no value education are
unlikely to value it themselves
Pg 51
Management by Accounting,
Antithesis of Total Quality
Managing the organizations financial results instead of
the people and processes that produce those results
Creates an analytically detached approach to decision making
– Printouts vs firsthand knowledge and insight
Focus on short-term cost reduction
– At the cost of long term improvements in people and
Narrowly focused manages viewing every problem from a finance and
accounting perspective
Pg 67
• Ethics is the study of morality.
• Ethics is the study of human behavior
within a moral context.
• Morality are the values that that are
subscribed to and fostered by society
• Ethical behavior is behavior within the
limits prescribed by widely accepted
moral values
Pg 116
• As applied in the workplace, morality is
translated into standards of conduct.
• If a certain behavior is illegal, it is also
• However, conduct may be legal but
• Ethical behavior can be influenced by
an individual’s ego strength,
Machiavellianism, and focus of control.
Guild lines for Determining Ethical
Tests of Ethical Behavior
• Morning-After Test
– How will you feel tomorrow about what you did
• Front Page Test
– How would you feel if this was written up in the
• Mirror Test
– Can you look in the mirror
• Role reversal Test
– How would you feel about being on the receiving
end of this behavior?
• Commonsense Test
Pg 117
– How does this fit into everyday commonsense?
Guild lines for Determining Ethical
5 P’s of Ethical Behavior
– People think they are ethical people who let their conscience guild
them. And always want to feel good about themselves.
– People feel they have the “right stuff” to make unpopular decisions
– People believe “right” will prevail in the long run…..and they are
willing wait
– Stay the (ethical) course and see it through to it’s positive
– People take time to reflect and are guided by their internal ethical
Pg 117
Trust and Total Quality
• Trust is a critical element of ethics, which,
in turn, makes ethics critical in total quality.
• Many of the fundamental elements of total
quality depend on trust and ethical
Pg 119
including communication,
interpersonal relations,
conflict management,
problem solving,
employee involvement and empowerment,
and customer focus.
Trust and Total Quality
• Trust can be built by
–being loyal to those not
–keeping promises,
–and sincerely apologizing when
Pg 119
Values and Total Quality
• Values are the deeply held beliefs that form the core
of who we are.
• Values guide our behavior as individuals and as
• An organization will not produce quality product or
provide a quality service unless the organization
values quality
• Individuals and organizations apply their knowledge
and skills most willingly to efforts in which they
Pg 120
Integrity and Total Quality
• Integrity requires honesty, but it is more than just
• Integrity is a combination of honesty and
• People with integrity can be counted on to do the
right thing, do it correctly, and do it on time.
Manager’s Role in Ethics
• Managers play a key role in ethics in an
• They are responsible for
• setting an example of ethical behavior,
• helping employees make ethical choices,
• and helping employees follow through and
behave ethically after making an ethical
• In carrying out these responsibilities, managers can
use the best-ratio approach, black-and-white
Pg 123
approach, and full-potential approach.
Partnering or Strategic
• Partnering means working together for mutual
• The purpose of partnering is to enhance
• It involves pooling resources, sharing costs, and
cooperating in ways that mutually benefit all parties
involved in the partnership.
• Partnerships may be formed internally (among
employees) and externally with suppliers, customers,
and potential competitors.
• The maximum benefits of partnering are realized
when all parties in the chain of partners cooperate.
Partnering with Suppliers
Traditional supplier relationships have been adversarial
• The goal is to form a mutually beneficial relationship
which promotes continuous improvement of quality,
productivity and competitiveness.
• Stages of development
• Uncertainty & tentativeness
• Short-term pressure
• Need for new opportunity
• Adoption of new paradigm
• Awareness of potential
• Adoption of new values
• Mature partnering
Pg 156
Partnering with Customers
• The rationale for forming customer
partnerships is customer satisfaction and
increased competitiveness.
• The best way to ensure customer
satisfaction is to involve customers as
partners in the product development
process. quality is a fundamental aspect of total quality.
• Doing so is, in turn, the best way to ensure
Partnering with Potential
Increased competitiveness
• Competitors may ban together to improve domestic
manufacturing to improve their competitive position
over foreign imports.
• Competitors may produce products for one another
when facilities and equipment are not available
• Competitors may share information on safety,
regulatory controls, education, training, etc
• This is especially prevalent with small and mid-sized
enterprises (SMEs)
Pg 160
Manager’s Role in Ethics
Best Ratio Approach
• Based on the belief that all people are
basically good
• In the right conditions they will behave ethically
AND under certain conditions they will behave
• Managers need to create conditions that
promote ethical behavior.
• Maintain the best possible ratio of good
choices over bad choices
• When faced with hard decisions, to the most
good for the most people
Manager’s Role in Ethics
Black and White Approach
• Right is right and wrong is wrong regardless of
the conditions
• Managers need to make ethical decisions and
carry them out
• Managers should make fair and impartial
choices regardless of the out come and do the
right thing without concern for short term
Pg 124
Manager’s Role in Ethics
Full Potential Approach
• Decisions are made based upon how they will
effect the ability of those involved to reach their
full potential
• People are responsible for realizing their full
potential within the parameters of morality
• Ethical choices are those which achieve the
goal without infringing on the rights of others
Models for Making Ethical
Categorical Imperative Model
• Right is right, wrong is wrong, there are no gray areas
• By who’s definition of right & wrong?
Full-disclosure Model
• Could the company explain its action to the stakeholders?
• Values of the stakeholders are applied to decide what is ethical.
Doctrine of the Mean Model
• In any situation, a moderate middle ground is an ethical option
• Moderation is ethical?
Golden Rule Model
• “do unto others as you would have them do unto you”
• Values of the stakeholders are applied to decide what is ethical.
Market-ethic Model
• Any legal action that promotes profitability is ethical
• In the long run the market will reject unethical behavior because it
is unprofitable
Pg 130
Models for Making Ethical
Organizational Ethic Model Continued
• What ever serves the organization’s interest is ethical
• A set of guiding principals must be in place to ensure ethical
Equal Freedom Model
• Organizations have the right to behave as they wish so long as
they do not impinge on the rights of the stakeholders
• Need to look at long range impact of behaviors
Proportionality Ethic Model
• The world is so complex that decisions are never clearly right
or wrong
• Make sure the good outweighs the bad
Profession Ethic Model
• Profession Peer Review
• Professional Code of Ethics
Pg 130
Customer Defined Quality
• Only Customers can tell you what they want and how they want
• Must work with customers to determine their needs and
collaborate with suppliers & operations to deliver them.
• Components of Customer defined quality
 Identifying Customer needs
 Customer focus
 Customer Satisfaction
Customer Satisfaction
• In a total quality setting, customers define quality.
Therefore, customer satisfaction must be the highest
• Customer satisfaction is achieved by producing highquality products that meet or exceed expectations.
• It must be renewed with each purchase.
• Focus must be on the customer
• The key to establishing a customer focus is to
put employees in touch with customers so that
customer needs are known and understood.
Customer Satisfaction
• To ensure customer satisfaction, it must be renewed
with every new purchase.
• This cannot be accomplished if quality, even though
it is high, is static.
• Satisfaction implies continual improvement.
• Continual improvement is the only way to keep a
customer satisfied and loyal.
Keys to Customer
• Establishing a customer focus.
 put employees in touch with customers so
that customer needs are known and
• Continual improvement
Process improvement throughout the
supply chain; from raw materials to delivery
Making things better, even when they are
not broken
Customer Satisfaction
Customer Satisfaction is critical, but it is not the end
of the race. It is a means to an end, not the end.
The goal is Customer Retention
Quality Culture:
Changing Hearts, Minds and
• A quality culture is an organizational value system that
results in an environment that is conducive to the
establishment and continual improvement of quality. It
consists of values, traditions, procedures, and
expectations that promote quality.
• Implementing total quality necessitates cultural change in
an organization, for the following reasons:
 Change cannot occur in a hostile environment.
 Moving to total quality takes time.
 It can be difficult to overcome the past.
Change cannot occur in a
hostile environment
The total quality approach to doing business may be radically different
than what management and employees are used to.
Managers who are used to sitting in their lonely towers at the top of the
pecking order and issuing edicts from on high are likely to reject the
concept of employee involvement and empowerment.
Employees who are used to competing against their own fellow
workers for promotion and wage increases may not be open to
mutually supportive internal partnerships and teamwork.
Situations such as this can create an environment that is hostile
toward change, no matter how desirable that change is.
Change can be difficult, even when people want to change. It can be
impossible in a hostile environment.
Moving to total quality takes
• The nature of total quality is such that the organization may
have to go down somewhat before it can turn things around and
start to come up.
• In a conversion to total quality, positive results are rarely
achieved in the short run.
• This characteristic gives non-believers and people who just
don't want to change (and such people are often the majority at
first) the opportunity to promote the "I told you it wouldn't work"
It can be difficult to overcome the
• Employees who have worked in an organization for
any period of time have probably seen a variety of
management fads come and go.
• Promoting the latest management gimmick and then
letting it die for lack of interest may be part of the
existing organizational culture. If this is the case, it
will be difficult to overcome the past.
• The past is not just an important part of an
organization's culture; it can be the most difficult part
to overcome
Organizational Change
• The laws of organizational change are as follows:
 Understand the history behind the current culture.
 Don’t tamper with systems—improve them.
 Be prepared to listen and observe.
 Involve everyone affected by change in making it.
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• Leadership is the ability to inspire people to make a
total, willing, and voluntary commitment to
accomplishing or exceeding organizational goals.
• Good leaders overcome resistance to change,
broker the needs of constituent groups inside and
outside the organization, and establish an ethical
• Good leaders are committed to both the job to be
done and the people who must do it. They are good
communicators and they are persuasive.
common myths about leadership
Leadership is a rare skill.
While it is true that few great leaders of world renown exist, many good,
effective leaders do. Most effective leaders spend their careers in virtual
anonymity, but they exist in surprisingly large numbers and there may be
little or no correlation between their ability to lead and their relative
positions in an organization. One of the keys to success in a total quality
setting is to create an environment that brings out the leadership skills of
all employees at all levels and focuses them on continually improving
Leaders are born, not made.
Leadership, attitudes, and behaviors can be learned, even by those who
do not appear to have inborn leadership potential.
Leaders are charismatic.
Some leaders have charisma and some don't. Some of history's most
renowned leaders have had little or no charisma. Correspondingly,
some of history's greatest misleaders have been highly charismatic.
common myths about leadership
• Leadership exists only at the top.
Total quality would not work if this myth were true. Total quality
relies on the building of teams at all levels in an organization and
teaching employees in these teams to be leaders. In reality, the
opposite of this myth is often true. Top managers may be the
least capable leaders in a company. Leadership is about
producing results and causing continual improvement, not one's
relative position within the organization.
• Leaders control, direct, prod, and manipulate.
If practice is an indicator, this is the most widely believed myth.
Leadership is about involving and empowering, not prodding and
• Leaders don't need to be learners.
Lifelong learning is a must for leaders. One cannot be a good
leader without being a good learner. Leaders approach learning
from the perspective of what matters most to their organization
Leadership Styles
• Common leadership styles include the
– democratic,
– participative,
– goal-oriented,
– and situational.
Maslow's Hierarchy of Needs
Effective Communication
• Communication is a process that involves a
message, sender, receiver, and medium.
• The message is what is being transmitted
(information, emotion, intent, or something else).
• The sender is the originator of the message
• The receiver is the person to whom it goes.
• The medium is the vehicle used to transfer the
four levels of communication.
• One-On-One-Level Communication - One-one level
communication involves one person communicating within a
peer group.
• Team-Level Communication -The primary difference between
one-on-one and team-level communication is that, with the
latter, all team members are involved in the process at once. A
team meeting called to solve a problem or to set goals would be
an opportunity for team-level communication.
• Company-Level Communication - Company-level
communication is communication among groups. A meeting
involving various different departments within a company is an
opportunity for company level communication.
• Community-Led Communication - Community-led
communication occurs when groups inside of a company and
groups outside the company. The most common examples of
community- level communication are a company's sales force
communicating with clients and the purchasing department
communicating with vendors.
Inhibiting Effective
• Various factors can inhibit communication.
Prominent among these are:
 Differences in meaning
 A lack of trust
 Information overload
 Interference
 Premature judgments
 “Kill the Messenger” syndrome
 Condescending tone
 Inaccurate assumptions
 Listening problems.
Various factors can inhibit
• Differences in Meaning - People have different backgrounds,
levels of education, and cultures.
• words, gestures, and facial expressions can have
altogether different means to different people.
• This is why managers should invest time getting to
know employees.
• Lack of Trust - If receivers do not trust senders, they may be
overly sensitive and guarded.
• They might concentrate so hard on reading between
the lines and looking for hidden agendas that they
miss the message.
• Information Overload - Information overload is more of an
inhibitor than it has ever been.
• Computers, modems, satellite communication,
facsimile machines, electronic mail, and the many
other technological devices developed to promote
and enhance communications can actually cause
breakdowns in communication.
Various factors can inhibit
• Interference - Interference is any external distraction that
inhibits effective communication.
• Condescending Tone - A condescending tone when
conveying information can inhibit effective communication.
• People do not like being talked down to and typically
respond to tone of voice as much as or more than the
content of a message.
• Poor Listening Skills - Poor listening skills can seriously
inhibit effective communication.
• Premature Judgement - Premature judgments by either the
sender or the receiver can inhibit effective communication.
Various factors can inhibit
• Inaccurate Assumptions - Our perceptions are
influenced by our assumptions.
• Consequently, inaccurate assumptions tend to
shut down communication before it has a
change to get started.
• Kill-the-Messenger Syndrome - In the days when
gladiators dueled in Rome's Coliseum, it was
common practice to kill the bearer of bad news.
• Managers who kill the manager when an
employee tells the hard truth will eventually
hear only what employees think they want to
• This dangerous situation quickly leads to
uninformed ill-advised managers.
Pareto charts
• The Pareto principle suggests that most effects come
from relatively few causes. In quantitative terms: 80%
of the problems come from 20% of the causes
(machines, raw materials, operators etc.); 80% of the
wealth is owned by 20% of the people etc. Therefore
effort aimed at the right 20% can solve 80% of the
problems. Double (back to back) Pareto charts can be
used to compare 'before and after' situations. General
use, to decide where to apply initial effort for maximum
cause-and-effect diagram
• The cause-and-effect diagram was developed by the late
Dr. Kaoru Ishikawa, a noted Japanese quality expert;
others have thus called it the Ishikawa diagram. Its
purpose is to help identify and isolate the causes of
problems. It is the only one of the seven basic quality
tools that is not based on statistics.
• Histograms have to do with variability. Two kinds of
data are commonly associated with processes:
attributes data and variables data. An attribute is
something that the output product of the process either
has or does not have. Variables data are data that
result when something is measured. A histogram is a
measurement scale across one axis and a frequency
of like measurements on the other.
Check Sheets
• The check sheet is a tool that facilitates collection of relevant data,
displaying it in a visual form easily understood by the brain. Check
sheets make it easy to collect data for specific purposes and to
present it in a way that automatically converts it into useful
• A Check Sheet is a data recording form that has been designed to
readily interpret results from the form itself. It needs to be designed for
the specific data it is to gather. Used for the collection of quantitative
or qualitative repetitive data. Adaptable to different data gathering
situations. Minimal interpretation of results required. Easy and quick to
use. No control for various forms of bias - exclusion, interaction,
perception, operational, non-response, estimation.
Scatter Diagrams
• The scatter diagram is arguably the simplest of the seven basic
quality tools. It is used to determine the correlation between two
variables. It can show a positive correlation, a negative correlation,
or no correlation.
Run Charts and Scatter Plots
Variable Y
Variable X
Control Charts
• In the context of the seven total quality tools, run
charts and control charts are typically thought of as
being one tool together. The control chart is a more
sophisticated version of the run chart. The run chart
records the output results of a process over time. For
this reason, the run chart is sometimes called a trend
chart. The weakness of the run chart is that it does
not tell whether the variation is the result of special
causes or common causes. This weakness gave rise
to the control chart.
Rationale for Continual
The rationale for continual improvement is that it is necessary in order
to compete in the global marketplace.
Just maintaining the status quo, even if the status quo is high quality,
is like standing still in a race.
Customer needs are not static. They change continually.
– A typical example is the personal computer.
The Scientific Approach
● Using the scientific approach means:
 Collecting meaningful data
 Identifying root causes of problems
 Developing appropriate solutions
 Planning and making changes.
 The scientific approach makes decisions based on
data, looking for root causes of problems, and
seeking permanent solutions instead of relying on
quick fixes.
To effectively manage, measure
and improve something, it must
first be understood
Common Improvement
• Commonly used improvement strategies include the
 Describing the process
 Standardizing the process
 Eliminating errors in the process
 Streamlining the process
 Reducing sources of variation
 Bringing the process under statistical control
 Improving the design of the process.
Goldratt’s Theory of Constraints
Goldratt’s theory of Constraints is another approach used to achieve
continual improvement in the workplace. It involves the following
 Identify
 Exploit
 Subordinate
 Eliminate restraints
 Overcome inertia
Optimizing and Controlling
Processes through Statistical
Process Control (SPC)
• A total of 99.73% of the output of a process that is in statistical
control will fall within the ±3σ limits of the process.
• Do not confuse process average and limits with specification
average and limits.
• It is usually desirable to make the process average coincident
with the specification average and to make the process spread
narrower than the specification limits.

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