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Total Quality Management

and the

Transition To Business Excellence

Dr. Rick L. Edgeman

Professor & Chair Department of Statistics 415 Brink Hall University of Idaho Moscow, Idaho 83844-1104 redgeman@uidaho.edu

The TQM philosophy derives from one foundational idea:

everything must be geared towards customer satisfaction, the engine which drives the company and on which its future survival depends.

Aim: Incre ase external and internal customer satisfaction w ith a re duced amount of resources
Control Top Management Relation Factorial Charts Focus on Commitment Diagram Design Criteria of Processes Focus on Matrices Improve MBNQA Customers Continuously Ishikawa Tree Process Diagram Diagram Let Everybody Maps Base Decisions be Committed ISO Quality on Fact 9000 Hypothesis House Quality Function testing Deployment Quality Employee Supplier Circles Development Partnership BenchProcess Policy Management marking Deployment SelfDesign of assessment Six Experiment Total Quality Sigma



M anagement

M ethodologies

Total Quality Management (TQM) can be seen as a continuously evolved management system, consisting of values, methodologies and tools. The aim of the system is to increase external and internal customer satisfaction with a reduced amount of resources. It is important to note, that the techniques and tools in the figure are just examples and not a complete list. In the same way the values may also vary a little between different organisations and over time. (From Hellsten & Klefsj, 2000.)

What is Quality?
Continuous Satisfaction of Customer Requirements

A Customer-Centric View

What is Quality Management?

Achievement of Quality at Low Cost.

What is Total Quality Management?

Attainment of

Total Quality
Through Everyones Commitment on a Daily Basis

SO ..
Quality is a state in which value entitlement is
realized for the customer and provider in every aspect of the business relationship.

Business quality is highest when the costs are at

the absolute lowest for both the producer & consumer and is most readily attained when the entirety of the organizations human resource is engaged..

Anything Else is Just a Killer

Renaults Five Principles of a New Culture

Fundamentally, organizational culture can be thought of as the way we do things around here.

The Customer is the Ultimate Judge of Value

The Search for a Lean Approach

Controlling the Process Means Reducing Dispersion

Involving & Empowering People The Spiral of Continuous Improvement

Quality Culture Principles

Quality People

Reducing Waste

Progress Through S-PDSA



an overall way of working that balances stakeholder interests and increases the likelihood of sustainable competitive advantage and hence long-term organizational success through operational, customer-related, financial and marketplace performance excellence.

Edgeman, Dahlgaard, Dahlgaard & Scherer, 1999

An Aligned Approach to Organizational Performance Management That Results In:

Harry Hertz 15 Sept. 2000

Delivery of Ever-Improving Value to Customers, Resulting in Marketplace Success; Improving Organizational Effectiveness and Capabilities; and Organizational and Personal Learning.

The comprehensive, systematic, and regular review of an organizations activities and results against a specified model. Purpose: Identification of strengths, weaknesses and opportunities for improvement.

The Principal Use of Excellence Models

Business Excellence Principles

Leadership & Constancy of Purpose Customer Focus Results Orientation Management by Processes & Facts People Development & Involvement Continuous Learning, Innovation & Improvement Partnership Development Public Responsibility

European Quality Award Excellence Criteria

People Processes Leadership Policy & Strategy Key Performance Results Partnerships & Resources Customer Results Society Results People Results




The EQA Excellence Model as an Input-Transform-Output-Inform Model


From TQM to Business Excellence

Quality Awards Around the World

Programs in place No programs

ISO 9000:2000
Quality system standards adopted by International Organization for Standardization in 1987; revised in 1994 and 2000 Technical specifications and criteria to be used as rules, guidelines, or definitions of characteristics to ensure that materials, products, processes, and services are fit for their purpose.


Objectives of ISO Standards (1 of 2)

Achieve, maintain, and continuously improve product quality Improve quality of operations to continually meet customers and stakeholders needs Provide confidence to internal management and other employees that quality requirements are being fulfilled

Objectives of ISO Standards (2 of 2)

Provide confidence to customers and other stakeholders that quality requirements are being achieved Provide confidence that quality system requirements are fulfilled


Structure of ISO 9000 Standards

Four major sections:
Management Responsibility Resource Management Product Realization Measurement, Analysis, and Improvement


ISO 9000:2000 Quality Management Principles

1. 2. 3. 4. 5. 6. 7. 8. Customer Focus Leadership Involvement of People Process Approach System Approach to Management Continual Improvement Factual Approach to Decision Making Mutually Beneficial Supplier Relationships