CE157 – TOTAL QUALITY MANAGEMENT

SATURDAY, 4:30P.M. – 9:00P.M.

ENGR. LAMBERTO B. MARCIAL JR., M.S.C.M.
APPROACHES TO QUALITY MANAGEMENT
HISTORICAL EVOLUTION OF TQM

The historical evolution of Total Quality Management has taken

place in four stages. They can be categorized as follows

QUALITY INSPECTION

QUALITY CONTROL

QUALITY ASSURANCE

TOTAL QUALITY MANAGEMENT

QUALITY INSPECTION

the first stage of this development can be seen in the 1910s

when the Ford Motor Company’s ‘T’ Model car rolled off the
production line. The company started to employ teams of
inspectors to compare or test the product with the project
standard.
QUALITY CONTROL

With further industrial advancement, quality was controlled

through supervised skills, written specification, measurement
and standardization.

During the Second World War, manufacturing systems became

complex and the quality began to be verified by inspections
rather than the workers themselves. Statistical quality control
by inspection—the post-production effort to separate the good
product from the bad product—was then developed.
QUALITY ASSURANCE

contains all the previous stages in order to provide sufficient

confidence that a product or service will satisfy customers’
needs.

Other activities such as comprehensive quality manuals, use

of cost of quality, development of process control and auditing
of quality systems are also developed in order to progress
from quality control to the quality assurance
TOTAL QUALITY MANAGEMENT

involves the understanding and implementation of quality

management principles and concepts in every aspect of
business activities.

Total Quality Management demands that the principles of

quality management must be applied at every level, every
stage and in every department of the organization.
TOTAL QUALITY MANAGEMENT

The development of total quality management from 1950

onwards can be credited to the works of various American
experts. Among them, Dr Edward Deming, Dr Joseph Juran
and Philip Crosby have contributed significantly towards the
continuous development of the subject.
DEMING’S QUALITY MANAGEMENT
APPROACH
DR. WILLIAM EDWARDS DEMING

 The father of total quality management (TQM)

 He was a statistician and business consultant
 Became known as the Japanese post-war economic miracle
 His philosophy is one of cooperation and continual
improvement
 Best known in United States for his 14 points
 Author of the book entitled “Out of the Crisis”
SYSTEMS OF PROFOUND KNOWLEDGE

System formulated by Deming in response to several

management diseases being encountered by different
industries. The system includes four components or "lenses"
through which to view the world simultaneously:

 Appreciation of a system
 Knowledge of variation
 Theory of knowledge
 Knowledge of psychology
SYSTEMS OF PROFOUND KNOWLEDGE

 Appreciation of a system
 understanding the overall processes involving suppliers,
producers, and customers of goods and services

 Knowledge of variation
 the range and causes of variation in quality, and use of
statistical sampling in measurements
SYSTEMS OF PROFOUND KNOWLEDGE

 Theory of knowledge
 the concepts explaining knowledge and the limits of what
can be known

 Knowledge of psychology
 concepts of human nature
DEMING’S 14 POINTS FOR MANAGEMENT
Create a constant purpose toward improvement.

Instead of worrying exclusively about

quarterly profits, companies should
have a longer term strategy involving
innovation, investments in research
and education, and constant
improvement in products or services.
Create a constant purpose toward improvement.

 Long term quality plan

 Don’t just do the same things better

– find better things to do
Adopt the new philosophy

Quality is the new philosophy.

Deming believed the best way to
make money is to make quality the
number one principle within the
company.
Adopt the new philosophy

 Embrace quality throughout the

organization

 Create your quality vision, and

implement it
Stop depending on inspections (mass inspections)

Inspections are costly and

unreliable – and they don't improve
quality, they merely find a lack of
quality.
Stop depending on inspections (mass inspections)

Inspection is too late, ineffective,

and costly. It is too late to react to
the quality of a product when the
product leaves the door. Quality
comes not from inspection but from
improving the production process
Use a single supplier for any one item

End the practice of awarding

business on the basis of price tag
alone. Instead, minimize total cost.
Move towards a single supplier for
any item, based on a long-term
relationship of loyalty and trust.
Use a single supplier for any one item

Look at suppliers as your partners

in quality. Encourage them to
spend time improving their own
quality – they shouldn’t compete
for your business based on price
alone..
Improve constantly and forever

Continuously improve your

systems and processes. Deming
promoted the Plan-Do-Check-Act
approach to process analysis and
improvement.
Institute training and retraining.

Encourage staff to learn from one

another, and provide a culture and
environment for effective teamwork.
Institute training and retraining.

A trained worker has more

productivity and quality than an
untrained one, so giving training
sessions will drastically improve
the quality of the person and
directly it helps in better product
quality performance.
Institute leadership

Don’t simply supervise – provide

support and resources so that each
staff member can do his or her
best.

Be a coach instead of a policeman.

A company can display stunning
growth if potential leaders are
identified and encouraged.
Institute leadership

The aim of supervision should be

to lead and help people to do a
better job.
Eliminate fear

Drive out fear so that everyone

may work effectively for the
company.
Eliminate fear

If a person is not working willingly

with satisfaction and without fear
then he can never do a work
perfectly even if he has the intention
to be perfect in conscious mind, so
driving out fear is essential.
Break down barriers between departments

People in research, design, sales

and production must work as a
team, to foresee and solve
problems of production.
Get rid of unclear slogans

Eliminate slogans, exhortations

and targets for the workforce as
they do not necessarily achieve
their aims.

"Excellence in service"

"You can do better if you try."

Get rid of unclear slogans

Slogans and exhortations focuses

on the desire to do something
more than focusing on how to work
it.
Eliminate management by objectives

Eliminate numerical quotas in order

to take account of quality and
methods, rather than just numbers.
Remove barriers to pride of workmanship

Allow everyone to take pride in

their work without being rated or
compared
Implement education and self-improvement

Institute a vigorous program of

education and re-training for both the
management and the workforce.
Implement education and self-improvement

A person must grow after joining a

company, and letting them learn new
technology and techniques will
increase employee longevity,
experience and productivity.
Make “transformation” everyone’s job

Take action to accomplish the

transformation. Management and
workforce must work together.
Make “transformation” everyone’s job

Improve your overall organization by

forcing each person to take a step
toward quality; the transformation is
everybody’s job starting from the
director ending with the security.
THE DEMING CIRCLE
DEMING CIRCLE

The Deming Cycle, also known as

PDCA Cycle, is a continuous quality
improvement model consisting of four
logical and repetitive steps for
continuous improvement learning
which are Plan, Do, Check, and Act.
DEMING CIRCLE: PLAN

In the PLAN step, you establish the

objectives and processes necessary
to deliver results in accordance with
the expected output. By establishing
output expectations, the completeness
and accuracy of the plans is also a
part of the targeted improvement.
When possible, start on a small scale
in order to test possible effects.
DEMING CIRCLE: DO

During the DO step, you execute the

plan. While executing the plan, you
are also observing or collecting data
for it to be analyzed during the next
two steps.
DEMING CIRCLE: CHECK

For the CHECK step, you study the

actual results and compare it from the
expected results during the PLAN step.

You look for deviation in

implementation from the plan and also
look for the appropriateness and
completeness of the plan to enable
the execution
DEMING CIRCLE: ACT

If the CHECK shows that the PLAN

that was implemented in DO is an
improvement to the prior standard
(baseline), then that becomes the new
standard (baseline) for how the
organization should ACT going
forward (new standards are enACTed).
DEMING CIRCLE: ACT

If the CHECK shows that the PLAN

that was implemented in DO is not an
improvement, then the existing
standard (baseline) will remain in
place.
DEMING CIRCLE: ACT

In either case, if the CHECK showed

something different than expected
(whether better or worse), then there
is some more learning to be done...
Deming’s Seven Deadly Diseases of
Management

Referring to US Industry and their management practices

7 DEADLY DISEASES OF MANAGEMENT

1. Lack of constancy of purpose to plan products and services

that will have a market and keep the company afloat.

2. An emphasis on short term profits and short term thinking,

fed by fear of unfriendly takeover, and by demand from
bankers and owners for dividends.

3. Evaluation of performance and annual reviews.

4. Mobility of managers and job hopping

7 DEADLY DISEASES OF MANAGEMENT

5. Management by use only of available data.

6. High medical costs.

7. High costs of liability.

7 DEADLY DISEASES OF MANAGEMENT

5. Management by use only of available data.

6. High medical costs.

7. High costs of liability.

Lack of constancy of purpose

Constancy of purpose is essential to stay in the business. Its

absence spells doom for a company. Without constancy of
purpose, management does not think beyond the next quarter
and has no long-range plans for staying in business.
Lack of constancy of purpose

As long as the focus is on short term thinking, management will

fail to plan adequately. Without good long term planning, worker
efforts will be irrelevant: Total Quality Management (TQM)
cannot be a fad, as long-term forward progress should always
be the ultimate goal for any organization.
Emphasis on short-term profits.

Short-term thinking - the opposite of constancy of purpose - in

order to stay in business, fed by fear of the push from bankers
and owners for dividends. Boosting short-term profits is easier,
at it typically involves the cutting of any expense related to the
long term: training, quality assurance management,
maintenance, etc.
Evaluation of performance and annual reviews.

Management by objective, on a go / no-go basis, without a

method for accomplishment of the objective, is the same thing
as management by fear. The essential problem with merit
systems is that they reward results rather than process
improvement-results will almost always have a lot of system
luck mixed in.
Mobility of management: job-hopping

The simplest and yet one of the most deadly of quality systems
management diseases, management mobility (or when top
management changes organizations every 3-4 years) means
continuous improvement efforts will be broken and disjointed as
new leaders come on board.

With changes in leadership, there is a change in management

philosophy. Managers who have an eye on the next promotion
want results - now - to gain the next rung on the ladder.
Management by use only of available data

Use of visible figures only for management, with little or no

consideration of figures that are unknown or unknowable.
Some facts are simply unknowable. Knowing this, Deming
insisted that leaders must still make decisions and manage a
situation.
High medical costs.

For the economy as a whole, health care as a percentage of

overall expenditures has steadily risen for decades, which
gradually pushes numerous businesses into a state of crisis.
Potentially the only remedy for this disease would be a political
system attempting to reform health care.
High costs of liability

W. Edwards Deming blamed America's lawyers in part for the

problems of American business. The US has more lawyers per
capita than any other country in the world, and they spend
much of their professional time finding people to sue.

Like health care costs in No. 6, Deming believed the remedy to

this disease will probably have to come from the government.
JURAN’S QUALITY MANAGEMENT APPROACH
JOSEPH M. JURAN

 Management consultant specializing in managing for

quality

 One of the fathers of Quality movement

 Authored hundred of papers and 12 books

JOSEPH M. JURAN

“Total quality management begins from the highest

position in the management, and continues all the
way to the bottom”
QUALITY ACCORDING TO JURAN

 standard of something as measured against other things of a

similar kind.

 the degree of excellence of something.

 features of products and services which meet customer

needs and thereby provide customer satisfaction.

 a distinctive attribute or characteristic possessed by

someone or something.
JURAN’S APPROACH

Quality is defined as fitness for use in terms of design,

conformance, availability, safety, and field use.

Top-down
management
method Quality problems
Rely on systems
result from
and problem
insufficient and
solving technique
ineffective planning
Incorporate view
point of customer
PARETO’S PRINCIPLE

Joseph Juran identified an

economic concept that he
applied to quality problems.

The economic concept is called

Pareto’s law or the 80/20 rule.
He fathered the idea of applying
the Pareto principle to reducing
defects
PARETO’S PRINCIPLE

 Thus, according to Juran, 80% of the problems in an

organization are caused by 20% of the causes.

 This is also known as the rule of the "Vital few and the Trivial
Many".

 In his later years, he preferred "the Vital Few and the Useful
Many" suggesting that the remaining 80% of the causes
must not be completely ignored.
JURAN’S PHILOSOPHY

“the root cause of quality issues was the resistance to change,

and human relations problems”
THE JURAN’S TRILOGY
JURAN’S TRILOGY

 Juran’s Trilogy shows how an organization can improve

every aspect by better understanding of the relationship
between processes that plan, control and improve quality as
well as business results

 This quality trilogy comprises three legislative processes

JURAN’S TRILOGY

Quality Planning

Quality Control

Quality
Improvement
QUALITY PLANNING

 Establish quality goals

 Identify who the customers are
 Determine the needs of the customers
 Develop product features that respond to customer’s needs
 Establish quality objectives
 Establish process controls; transfer the plans to the
operating forces
QUALITY PLANNING

 Establish quality goals

 Identify who the customers are

 Determine the needs of the

customers
QUALITY PLANNING
QUALITY CONTROL

 Develop a process which is

able to produce the product.

 Optimize the process.

QUALITY CONTROL

 Evaluate actual performance

 Compare actual performance

with quality goals

 Act on difference
QUALITY IMPROVEMENT

This process is the means of raising

quality performance to unprecedented
levels. The methodology includes:

 Establish the infrastructure needs

to secure annual quality
improvement.

 Identify the specific needs for

improvement.
QUALITY IMPROVEMENT

 For each project establish a project

team with clear responsibility for
bringing the project to a successful
conclusion.

 Provide the resource, motivation, and

training needed by the team to:
 Diagnose the cause.
 Stimulate establishment of remedies.
 Establish controls to hold the gains.
COST OF QUALITY

The cost of quality, or not getting it right

the first time, Juran maintained should be
recorded and analyzed and classified into
failure costs, appraisal costs and
prevention costs.
COST OF QUALITY

Failure Cost

- scrap, rework, corrective actions,

warranty claims, customer complaints and
loss of custom.
COST OF QUALITY

Appraisal Cost

- Inspection, compliance auditing and

investigations.
COST OF QUALITY

Prevention Cost

- Training, preventive auditing, and

process improvement implementation.
JURAN’S 10 STEPS TO QUALITY
IMPROVEMENT
JURAN’S 10 STEPS TO QUALITY IMPROVEMENT

1. Build awareness of the need and opportunity for

improvement

2. Set goals for improvement

3. Organize to reach the goals (establish a quality council,

identify problems, select projects, appoint teams, designate
facilitators)
JURAN’S 10 STEPS TO QUALITY IMPROVEMENT

4. Provide training

5. Carry out projects to solve problems

6. Report progress

7. Give recognition
JURAN’S 10 STEPS TO QUALITY IMPROVEMENT

8. Communicate results

9. Keep score

10. Maintain momentum by making annual improvement part

of the regular systems and processes of the company
CROSBY’S QUALITY MANAGEMENT
APPROACH
PHILIP CROSBY

 Contributor to management theory and quality

management practices

 Quality as conformance to customer requirements

 His advocacy of zero defects management

PHILIP CROSBY

 Quality is free

 Theory: “Doing it right for the first time”

ZERO DEFECTS

“The only performance standard is Zero Defects “

Zero Defects is a performance standard. It is the standard

of the craftsperson regardless of his or her assignment.
The theme of Zero Defects is doing it right the first time.
That means concentrating on preventing defects rather that
just finding and fixing them.
CROSBY’S CONCEPT OF COST OF QUALITY

PREVENTION
COST
OF GOOD
QUALITY
APPRAISAL
TOTAL COST
OF QUALITY
INTERNAL
FAILURE
COST
OF POOR
QUALITY EXTERNAL
FAILURE
THE ABSOLUTES OF MANAGEMENT
14 Steps to
quality
improvement
Management is committed
01 to quality – and this is clear
to all

Create quality improvement

02 teams – with representatives
from all work groups and
functions

Measure processes to
03 determine current and
potential quality issues
Clarify where management stands on quality. It is
14 Steps to
necessary to consistently produce conforming quality
products and services at the optimum price. The
device to accomplish this is the use of defect prevent improvement
ion techniques in the operating departments
Management is committed
(Engineering, Manufacturing, Quality Control, to quality – and this is clear
01
Purchasing, Sales and others) to all

Create quality improvement

02 teams – with representatives
from all work groups and
functions

Measure processes to
03 determine current and
potential quality issues
 14 Steps to
quality
improvement
These teams run the quality improvement program.
Since every function of an operation contributes to Management is committed
01 to quality – and this is clear
defect levels, every function must participate in the to all
quality improvement effort. The degree of
participation is best determined by the particular Create quality improvement
situation that exists. However, everyone has the 02 teams – with representatives
from all work groups and
opportunity to improve. functions

Measure processes to
03 determine current and
potential quality issues
Communicate current and potential non- 14 Steps to
conformance problems in a manner that permits
objective evaluation and corrective action. Basic quality
quality measurement data is obtained from the
inspection and test reports, which are broken down improvement
by operating areas of the plant. By comparing the
Management is committed
rejection data with the input data, it is possible to 01 to quality – and this is clear
know the rejection rates. Since most companies to all

have such systems, it is not necessary to go into

Create quality improvement
them in detail. It should be mentioned that unless teams – with representatives
02
this data is reported properly, it is useless. After all, from all work groups and
functions
their only purpose is to warn management of serious
situations. They should be used to identify specific Measure processes to

problems needing corrective action, and the quality 03 determine current and
potential quality issues
department should report them.
 14 Steps to Quality Improvement
Continuation…

04 05 06 07

Calculate the cost of Raise quality Take actions to Monitor progress of

(poor) quality awareness of all correct quality quality improvement
employees issues – establish a zero
defects committee
 14 Steps to Quality Improvement
Continuation…

Define the ingredients of the COQ and explain its use as a management tool.

04 05 06 07

Calculate the cost of Raise quality Take actions to Monitor progress of

(poor) quality awareness of all correct quality quality improvement
employees issues – establish a zero
defects committee
 14 Steps to Quality Improvement
Continuation…
Provide a method of raising the personal concern felt by all personnel in the
company toward the conformance of the product or service and the quality
reputation of the company. By the time a company is ready for the quality
awareness step, they should have a good idea of the types and expense of the
problems being faced. The quality measurement and COQ steps will have reveal
ed them. Define the ingredients of the COQ and explain its use as a management
tool.

04 05 06 07

Calculate the cost of Raise quality Take actions to Monitor progress of

(poor) quality awareness of all correct quality quality improvement
employees issues – establish a zero
defects committee
 14 Steps to Quality Improvement
Continuation…

Provide a systematic method of permanently resolving the problems that are

identified through previous action steps. Problems that are identified during the
acceptance operation or by some other means must be documented and then
resolved formally.

04 05 06 07

Calculate the cost of Raise quality Take actions to Monitor progress of

(poor) quality awareness of all correct quality quality improvement
employees issues – establish a zero
defects committee
 14 Steps to Quality Improvement
Examine the various activities that mustContinuation…
be conducted in preparation for formally
launching the Zero Defects program - The quality improvement task team should
list all the individual action steps that build up to Zero Defects day in order to make
the most meaningful presentation of the concept and action plan to personnel of
the company. These steps, placed on a schedule and assigned to members of the
team for execution, will provide a clean energy flow into an organization-wide Zero
Defects commitment.

04 05 06 07

Calculate the cost of Raise quality Take actions to Monitor progress of

(poor) quality awareness of all correct quality quality improvement
employees issues – establish a zero
defects committee
 14 Steps to Quality Improvement
Continuation…

Encourage employees to create

Hold zero defects days 09 10 their own quality improvement
goals

Quality
Encourage employee
Train supervisors in quality Improvement communication with
improvement 08 11 management about obstacles to
quality (Error-Cause Removal)
 14 Steps to Quality Improvement
Continuation…

Define the type of training supervisors need in order to actively

carry out their part of the quality improvement program. The
supervisor, from the board chairman down, is the key to
09
achieving improvement goals. The supervisor gives the individual
employees their attitudes work standards, whether in engineering,
sales, computer programming, or wherever. Therefore, the Train
supervisors
supervisor must be given primary consideration when laying out the
program. The departmental representatives on the task team will
08 in quality
improvement
be able to communicate much of the planning and concepts to the
supervisors, but individual classes are essential to make sure that
they properly understand and can implement the program.
 14 Steps to Quality Improvement
Continuation…

Create an event that will let all employees realize through personal experience, that
there has been a change. Zero Defects is a revelation to all involved that they are
embarking on a new way of corporate life. Working under this discipline requires
personal commitments and understanding. Therefore, it is necessary that all member
s of the company participate in an experience that will make them aware of this
change.

09 10
Hold zero
defects days
 14 Steps to Quality Improvement
Continuation…

Turn pledges and commitments into action by encouraging individuals to establish

improvement goals for themselves and their groups. About a week after Zero Defect
s day, individual supervisors should ask their people what kind of goals they should
set for themselves. Try to get two goals from each area. These goals should be
specific and measurable.

09 10
Encourage employees to
create their own quality
improvement goals
 14 Steps to Quality Improvement
Continuation…

Encourage employees to create

Hold zero defects days 09 10 their own quality improvement
goals

Quality
Encourage employee
Train supervisors in quality Improvement communication with
improvement 08 11 management about obstacles to
quality (Error-Cause Removal)
 Give the individual employee a method of communicating to
14 Steps to Quality Improvement
management the situations that make it difficult for the employee
to fulfil the pledge to improve. One of the most difficult problems
Continuation…
employees face is their inability to communicate problems to
management. Sometimes they just put up with problems
because they do not consider them important enough to bother
the supervisor. Sometimes supervisors don’t listen anyway.
10 Suggestion programs are some help, but in a suggestion
Encourage program the worker is required to know the problem and also
employee propose a solution. Error-cause removal (ECR) is set up on
communication
with management the basis that the worker need only recognize the problem.
about obstacles When the worker has stated the problem, the proper
to quality (Error- 11 department in the plant can look into it. Studies of ECR
Cause Removal)
programs show that over 90% of the items submitted are acted
upon, and fully 75% can be handled at the first level of supervisio
n. The number of ECRs that save money is extremely high, since
the worker generates savings every time the job is done better or
quicker.
14 Steps to Quality Improvement
Continuation…

12 Recognize participants’ effort

13 Create quality councils

Do it all over again – quality

14 improvement does not end
14 Steps to Quality Improvement
Continuation…

Appreciate those who participate.

12 Recognize participants’ effort
People really don’t work for money.
They go to work for it, but once the
salary has been established, their
is appreciation. Recognize their
13 Create quality councils
contribution publicly and noisily, but
don’t demean them by applying a price
tag to everything.

Do it all over again – quality

14 improvement does not end
 Bring together the professional quality
14 Steps to Quality Improvement people for planned communication on a
regular basis. It is vital for the professional
Continuation…
quality people of an organization to meet
regularly just to share their problems, feelings,
and experiences, with each other.
12 Recognize participants’ effort
Primarily concerned with measurement and
reporting, isolated even in the midst of many fe
llow workers, it is easy for them to become infl
uenced by the urgency of activity in their work
13 Create quality councils areas. Consistency of attitude and
purpose is the essential personal
characteristic of one who evaluates
another’s work. This is not only because of
Do it all over again – quality
the importance of the work itself but because t
14 improvement does not end hose who submit work unconsciously draw a g
reat deal of their performance standard
from the professional evaluator.
14 Steps to Quality Improvement
Continuation…

12 Recognize participants’ effort

Emphasize that the quality

improvement program never ends.
There is always a great sign of relief
13 Create quality councils when goals are reached. If care is not
taken, the entire program will end at
that moment. It is necessary to
construct a new quality improvement
Do it all over again – quality
team, and to let them begin again and
14 improvement does not end create their own communications.
 The Quality Vaccine
5 medicines

01
Quality must be taken seriously throughout the entire organization, from
Integrity the highest levels to the lowest. The company's future will be judged by
the quality it delivers.
02
The right measures and systems are necessary for quality costs, performance,
Systems
education, improvement, review, and customer satisfaction.
03
It is required to communicate the specifications, requirements and
Communication improvement opportunities of the organization. Listening to customers and
operatives intently and incorporating feedback will give the organization an
04 edge over the competition.
a culture of improvement should be the norm in any organization, and the process should
Operations
be solid.
05
Policies policies that are implemented should be consistent and clear throughout the organization.
TOOLS AND TECHNIQUES FOR QUALITY
MANAGEMENT
PERFORMANCE MEASUREMENT SYSTEM
PERFORMANCE MEASUREMENT SYSTEM

- collecting, analyzing and reporting information regarding

the performance of an individual, or group
IMPORTANCE OF PERFORMANCE
MEASUREMENT SYSTEM

- to provide feedback, relative to your goals

-reward an employee for contributing to increase in firm value

THE FIVE-STEP PROCESS TO BUILD A
PERFORMANCE MEASUREMENT SYSTEM

Putting your
Planning to Choosing Determining performance
Preparing to
measure what to how to measurement
use your data
measure measure system into
action
PLANNING TO MEASURE

- Form a performance measurement working group

- Conduct a performance measurement audit

CHOOSING WHAT TO MEASURE
- Understanding and selecting indicators
 Organizational Health Indicators
 Financial Sustainability
 Team Capacity
 Implementation Effectiveness

 Program Performance Indicators

 Activities
 Outputs
 Quality
 Program Costs
CHOOSING WHAT TO MEASURE

- Understanding and selecting indicators

 Social and Economic Impact Indicators
 Outcomes
 Outcomes Costs
 Systemic Impact Generated
- Compiling the lists of your indicators
DETERMINING HOW TO MEASURE

- Prepare your measurement tools

 Survey - tool for measuring beneficiary or staff satisfaction,
assessing progress toward a particular short-term goal, or soliciting
opinions from stakeholders about new programs and activities that
are under consideration.

- Determine where to store your data

 Spreadsheet software
 Standardized or packaged database, accounting or other software
PREPARING TO USE YOUR DATA

- Build your reporting tools: Dashboards

 Management dashboard - provides a birds-eye view of your
organization’s performance through a selection of key indicators
from your master list.

 Program-level dashboards - contain only the information relevant to

managers and other key team members working in a specified area,
which might be a particular initiative, or an internal operating area
such as marketing or human resources.
PUTTING YOUR PERFORMANCE
MEASUREMENT INTO ACTION
Mission and
Vision of Success

Activities and
Operations

Implement decisions to improve Track performance using

improve measure
activities and operations selected indicators

Extract knowledge from the data,

identify the opportunities for Communicate performance
improvement, and make data- learn report internally and externally
driven decisions
BENCHMARKING
BENCHMARKING

- A measurement of the quality of an organization's policies,

products, programs, strategies, etc., and their comparison
with standard measurements, or similar measurements of its
peers.

- Benchmarking is a process of measuring the performance of

a company’s products, services, or processes against those of
another business considered to be the best in the industry.
The point of benchmarking is to identify internal opportunities
for improvement.
BENCHMARKING

- Benchmarking is a process for obtaining a measure – a

benchmark. Simply stated, benchmarks are the “what,” and
benchmarking is the “how.”
OBJECTIVES OF BENCHMARKING

(1) to determine what and where improvements are called for

(2) to analyze how other organizations achieve their high

performance levels

(3) to use this information to improve performance.

TYPES OF BENCHMARKING

Strategic Benchmarking
Used when businesses need to improve overall performance, strategic
benchmarking examines the long-term strategies and general
approaches that have enabled high-performers to succeed

Performance or Competitive Benchmarking

Used when businesses wish consider their position in relation to
performance characteristics of key products and services
TYPES OF BENCHMARKING

Process Benchmarking
Focuses on improving specific critical processes and operations and
often results in short term benefits. Benchmarking partners are sought
from best practice organizations that perform similar work or deliver
similar services

Functional Benchmarking
Businesses look to benchmark with partners drawn from different
business sectors or areas of activity to find ways of improving similar
functions or work processes. It can lead to innovation and dramatic
improvements
TYPES OF BENCHMARKING

International Benchmarking
Best practitioners are identified and analyzed elsewhere in the world,
perhaps because there are too few benchmarking partners within the
same country to produce valid results
PROCESS OF BENCHMARKING

- Choose a product, service, or internal department to

benchmark

- Determine which best-in-class companies you should

benchmark against – which organizations you’ll compare your
business to

- Gather information on their internal performance, or metrics

PROCESS OF BENCHMARKING

- Compare the data from both organizations to identify gaps in

your company’s performance

- Adopt the processes and policies in place within the best-in-

class performers
BASIC TOOLS IN QUALITY MANAGEMENT
FISHBONE DIAGRAM

- Also Called as Cause–and–Effect Diagram,(Ishikawa

Diagram).

- Identify possible causes for such an effect.

- It can be used as brainstorming session.

- Immediately sort of useful ideas.

FISHBONE DIAGRAM

When to Use a Fishbone Diagram

- When identifying possible causes for a problem

- Especially when a team’s thinking tends to fall into ruts.

FISHBONE DIAGRAM

Procedure
- Agree on a problem statement
- Brainstorm Problems
- Categories of causes
- Brainstorm causes
- “Why does this happen?”
- Repeat finding the “why”
FISHBONE DIAGRAM
CHECK SHEET

- Also called as defect concentration diagram.

- is a structured, prepared form for collecting and analyzing

data.
CHECK SHEET

When to use a Check Sheet

- When data can be observed and collected repeatedly by the

same person or at the same location.

- When collecting data on the frequency or patterns of events,

problems, defects, defect location, defect causes, etc.

- When collecting data from a production process.

CHECK SHEET

Procedure
- Problem to be observed
- Data Collection
- Design the form
- Labeling
- Testing
- Record Data
CHECK SHEET
CONTROL CHART

- Also called as statistical process control

- is a graph used to study how a process changes over time.

- Data are plotted in time order

- Control charts for variable data are used in pairs.

CONTROL CHART

When to use a Control Chart

- When controlling ongoing processes by finding and correcting

problems as they occur.

- When predicting the expected range of outcomes from a

process.
CONTROL CHART

When to use a Control Chart

- When determining whether a process is stable (in statistical

control).

- When analyzing patterns of process variation from special

causes (non-routine events) or common causes (built into the
process).
CONTROL CHART

When to use a Control Chart

- When determining whether your quality improvement project

should aim to prevent specific problems or to make
fundamental changes to the process.
CONTROL CHART

Procedure
- Choose the appropriate control chart for your data.
- Determine the appropriate time period for collecting and
plotting data.
- Collect and Construct
- Look for “out-of-control signals”
- Continue to plot data as they are generated
CONTROL CHART
HISTOGRAM

- A histogram is a graphical display of tabulated frequencies.

- Pictorial representation of set of data.

- A histogram is the graphical version of a table which shows

what proportion of cases fall into each of several or many
specified categories.
HISTOGRAM

- It differs from a bar chart in that it is the area of the bar that
denotes the value, not the height, a crucial distinction when
the categories are not of uniform width.
HISTOGRAM

When to use a Histogram

- When the data are numerical.

- When you want to see the shape of the data’s distribution,

especially when determining whether the output of a process
is distributed approximately normally.

- When analyzing whether a process can meet the customer’s

requirements.
HISTOGRAM

When to use a Histogram

- When analyzing what the output from a supplier’s process

looks like.

- When seeing whether a process change has occurred from

one time period to another.

- When determining whether the outputs of two or more

processes are different.
HISTOGRAM

When to use a Histogram

- When you wish to communicate the distribution of data

quickly and easily to others.
HISTOGRAM
PARETO DIAGRAM

- In 1879, the famous Italian economist Alfred Pareto, noticed

that 80% of Italy’s wealth was controlled by 20% of the
population.

- Pareto’s law or Pareto’s rule or Principle of imbalance or

simply 80/20 rule

- Also called: Pareto diagram, Pareto analysis

PARETO DIAGRAM
When to use a Pareto Diagram
- When analyzing data about the frequency of problems or
causes in a process.

- When there are many problems or causes and you want to

focus on the most significant.

- When analyzing broad causes by looking at their specific

components.

- When communicating with others about your data.

PARETO DIAGRAM
SCATTER DIAGRAM

- Also called: scatter plot, X–Y graph

- The scatter diagram graphs pairs of numerical data, with one

variable on each axis, to look for a relationship between them

- If the variables are correlated, the points will fall along a line
or curve. The better the correlation, the tighter the points will
hug the line.
PARETO DIAGRAM

When to use a Pareto Diagram

- When you have paired numerical data.

- When your dependent variable may have multiple values for

each value of your independent variable.

- When testing for autocorrelation before constructing a control

chart.
PARETO DIAGRAM

When to use a Pareto Diagram

- When trying to determine whether the two variables are

related, such as:
 When trying to identify potential root causes of problems.
 After brainstorming causes and effects using a fishbone diagram, to
determine objectively whether a particular cause and effect are
related.
 When determining whether two effects that appear to be related both
occur with the same cause.
SCATTER DIAGRAM
PROCESS FLOW DIAGRAM

- Also called Flow Chart

- A flow chart is a pictorial representation showing all the steps

and processes involve in the operation.

- The diagram makes it easy to visualize the entire system,

identify potential trouble spots, and locate control activities.

- Improvements can be accomplished by changing, reducing,

combining, or eliminating steps.
STRATIFICATION

- Stratification is a technique used in combination with other

data analysis tools. When data from a variety of sources or
categories have been lumped together, the meaning of the
data can be impossible to see. This technique separates the
data so that patterns can be seen.