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Cause and effect of influencial people of quality

When the Japanese economy had the strongest need to restructure its economy to bring it out of the destruction that World War II had caused, the efforts of quality experts and Gurus such as W. Edwards Deming and Joseph M. Juran proved fruitful. They both emphasized the importance of improving the quality of products/services as a source of sustainable competitive advantage and cost reduction. Later, this became the focus of the American companies and so of organization round the globe as well.

Deming’s fourteen points highlighted the importance of following a systematic and continuous process by which the product specifications were to be laid out and then practically worked on. Following the implementation, the production was to be checked for errors and loop holes thereby taking immediate corrective measures such that the entire cycle continued until the optimum quality was reached. This, coupled with the participative style of managing even the production of goods and services is what caused Deming’s work to stand out. It was in fact his ideology that laid the foundations for the development of latest quality concepts such as Kaizen and Total Quality Management (TQM).

Toyota is one such company that has been a focused user of the aforementioned concepts for ensuring the provision of high quality product. However, what many other organizations have essentially ignored about Toyota’s success is that it is not linked with the processes and methodologies that it uses but with its operating principles. Its dependence on continuous inspection of the product sample till the optimum quality is reached by engaging all departments of the workforce let it take the leading position.

Such quality initiatives and their implementation can bring about success to any company. What it must realize however, is that only a committed focus to ever improving and thereby satisfying the customer is the key to success. No one method otherwise can become a source of sustainable competitive advantage especially in the dynamic economical situation prevalent today.

Table of Contents

Table of Contents 4

1.0.THE PHENOMENON 5

2.0.THE EVOLUTION OF THE IDEA 5

2.1.W. Edwards Deming 6

2.2.The Deming Philosophy 6

2.3.Significance of Deming’s Work 8

2.4.Impact of Deming’s Ideas on quality 8

3.0.Toyota’s Production System 9

4.0.Outcomes of Toyota’s Quality Focus 10

5.0.The Next Step 10

6.0.Conclusion 11

References 12

INFLUENTIAL PEOPLE OF QUALITY

Their Cause & Effect

THE PHENOMENON

Quality, for long has been defined differently by different people. Earlier, only a product’s conformance to preset requirements was interpreted to be its quality. As Crosby puts it

“Quality is conformance to requirements”

Over time however, with the refinement of the idea and the every increasing need to introduce it in every process , quality has come to become m ore consumer oriented. Thus, the product/ service is of the highest quality when it comes up to the consumer’s expectations. The latest definitions therefore especially emphasize the importance of the customer’s satisfaction alongside the fulfillment of requirements. The American Society for Quality has therefore given a more precise definition stated as follows

Quality denotes an excellence in goods & services especially to the degree they conform to the requirements and satisfy customers

Although a relative phenomenon, there are factors that universally govern the basic concept; factors that essentially do define quality. For instance, reliability is one aspect that contributes the most to the quality of the offering since reliability is understood in terms of the customer’s confidence about the product’s consistent performance.

THE EVOLUTION OF THE IDEA

At the earliest stages, ensuring quality of the products and services through their consistent and reliable performance was not much of a concern for the organizations. Later however with the advent of the industrial revolution , the importance of the concept rose dramatically especially when the American industrialists saw the Japanese making massive progress on the quality front while they lagged far behind.

Later it was realized that Fredric Taylor’s successful assembly line method only increased the productivity while negatively impacting the quality of the manufactured product. Although, Henry Ford applied the moving assembly line method for manufacturing of automobiles in 1913, a new era in this regard began in 1924 with the introduction of statistical methods for quality measurement and improvement by Walter A. Shewhart. By the 1970s, Japan had become a leader in terms of the production quality due to its emphasis on quality as part of their economic rebuilding efforts. As a result, the American manufacturers faced the pressure to introduce a stricter quality control system. Due to this, several theories took form in order to better explain the phenomenon, its importance and ways of inculcating that within the production system.

W. Edwards Deming

A prominent figure in the field of quality management, W. Edwards Deming belongs to the post World War II era. He did his electrical engineering from the University of Wyoming and later did his Ph. D. in mathematics. He had had the chance of being associated with the most successful companies such as the Western Electric Company & Ford. He also worked with the US. Department of Agriculture and US. Census Bureau.

Deming’s most notable work began with his propagation of quality as an essential for all products and services through his lectures delivered in Japan. Later, his PDCA cycle and the famous fourteen points of quality contributed tremendously to the development of what the concept of quality stands as of today.

The Deming Philosophy

W. Edwards Deming is amongst the most well known quality experts in the world. It was in fact himself and Joseph M. Juran who introduced and popularized the idea of quality production in Japan through their extensive lectures. His initial efforts lead the Japanese to understand the importance of quality and the value that it may create. Consequently, the American industries had no other choice but to focus more and more on quality improvements in their products and processes in order to sustain their business in the increasing fierce competition being posed by the Japanese industries.

Championing the foundations laid down by Shewhart, Deming produced his fourteen points which in themselves present the deepest insight into the philosophy of successful management for maintaining quality, productivity and competitive position of an organization. These points are listed as under

Create constancy of purpose for improvement of product and service

Adopt the new philosophy-take on leadership for change, poor workmanship, defective products or bad service are not acceptable

Cease dependence on mass inspection- Inculcate quality in the product from the very beginning using statistical quality control measures

End the practice of awarding business on the basis of price tag alone-instead minimize the cost and gain supplier loyalty and trust thereby strengthening the mutual relationship

Improve constantly and forever the system of production and service-plan, do and check

Institute training- employees must be encouraged to implement knowledge developed through training

Adopt and institute leadership-Supervision must be aimed at preparing the employees for leadership roles in their respective area

Drive out fear- Such an environment must be created by the management that encourages employees to take initiatives and make suggestions

Break down barriers between departments- implement team work and increase inter-department joint effort

Eliminate slogans, exhortations and targets for the work force- phrases such as having zero defects, and new levels of productivity may demoralize the work force with reference to their earlier efforts

Eliminate numerical quotas for the work force and numerical goals for people in the management- achieving just the numerical figure may actually deteriorate quality

Remove barriers that rob people of pride of workmanship- ensure the employee satisfaction and motivation. Implement action measures to ensure their association and sense of belonging with their work

Encourage education and self-improvement for everyone

Take action to accomplish the transformation- even the best of plans fail with poor execution

These fourteen points essentially highlighted the importance of the human resource and its involvement along with the management’s commitment and efforts for continuous quality improvements. For without this, no organization can move ahead of its competitors and sustain its competitive position. It also emphasizes the value of letting go of the conventional ways of handling this for some methods and processes can only lead to the same results with even greater cost implications that an organization might have incurred in the effort.

Significance of Deming’s Work

While Deming’s work has its most significant impact in turning the industrialists in Japan and then in US to manufacturing better and better quality products thereby maximizing the value to customer, it has had contributed in other terms to the development of quality as a concept.

Firstly, one must note that before Deming and his contemporaries laid emphasis on newer methods and better theories for understanding, Shewhart’s statistical methods of quality improvement provided the most basic foundations. Building upon them, Deming was perhaps the first theorist of is era to have shed light on the peoples aspect of quality. Later quality initiatives such as Kaizen and Total Quality Management (TQM) took their roots from the same principles and have now become the most essential of management practices to ensure a high degree of quality closely linked and supported by the entire organization. More specifically, his PDCA (Plan, Do, Check Act) cycle (Appendix 1) emphasized the process of continuous improvement that starts with a planning on the matter, performing the decided measure, checking for errors and ultimately taking immediate corrective measure. At the last stage, the cycle keeps on moving achieving even higher levels of conformance to standards of quality.

Looking at the fourteen principles given by Deming, one also notices his emphasis on shunning the long held practices of trying to ensure quality by detecting problems with the already produced goods/services. He, alternatively, proposes the quality to be built into the system such that it is maximized at the statistical and theoretical level before actual production can be carried out. This in turn can largely reduce production wastage and the cost incurred. Thus, in a way, he suggested and easier way to reduce cost, which is an emphasis in another of his points.

In a nutshell, Deming’s theory of quality most importantly highlights quality to be the responsibility of the management whereby the entire organization has to become a part of the effort. As a foundational role player for the most prevalent and successful management practices such as TQM and Kaizen, Deming’s work has played the most significant role in turning the attention and efforts of the organizations to providing the best possible standards of quality in products as well as services. Although the further initiatives by other theorists lead to the inception of ISO 9000 quality system standards, Baldrige National Quality Program and Malcom Baldridge National Quality Award, Deming’s work takes a monumental position amongst the initiatives.

Impact of Deming’s Ideas on quality

The importance of Deming’s theory of quality has its immense value as a foundational base for most of the modern concepts related to quality. Kaizen for instance is based on continuous improvement an idea put forth by Deming himself through the Deming’s Cycle (or PDCA cycle). TQM too is the Japanese version of his proposition of implementing quality through each and every segment of the organization including the human resource. One of the latest and most acclaimed quality practices, Six Sigma approach based on statistical methods, is also a gist of various theories such as TQM, quality control, zero defects etc all based on the concepts introduced by the pioneers of amongst which Deming has a commendable contribution.

Thus if one is to consider the impact of Deming’s work then one cannot ignore the change that his efforts brought to the Japanese industry as a result of which the production in America saw improvement as well leading to the application and implementation of the concepts related to quality worldwide. Additionally, the fact that the most well known of the quality theories, TQM, emphasizes participative management just as Deming’s fourteen points do, one can clearly see the high positive impact that his initiatives have had on quality at large.

Although there are various large and multinational organizations that have benefited from applying the developed quality principles, consider Toyota’s quality initiatives and its impact on their operations for a better understanding of the concept.

Toyota’s Production System

Amongst the most talked-about and envied automobile manufacturing company, Toyota has been a focus for all executives round the globe as a leader in terms of its best practices. However, despite the innumerable studies carried out to decipher the secret of its success, no other company has been able to imitate its production practices. What most companies and their executives do not realize is that it is not just the direct production process that this automobile giant has excelled at that has made it such a huge success.

In Harvard Business’s 1999 article, ‘Decoding the DNA of the Toyota Production System’, it was identified that more than its production process, Toyota’s secret of success in centered around its well managed and focused operating principles. Acting on these principles ensures that the operations depend on a system that is reliable and extremely efficient despite being highly flexible thus leading to a growth in its profits and market share. For a simplification of understanding, it would be enough to say that Toyota works by carefully laying out the specifications of the product and the related processes before they actually are put into production and then evaluates it while the process is still in progress. In this way, it is able to see whether or not the expectations are being matched with the actual results. If they do not, weak areas and loop holes are immediately identified and minimized to improve the process. This cycle continues till the quality of the end product has been optimized.

If we look closely, at each level of inspection, Toyota establishes a new temporary best practice replacing it with every new error of deficiency that might be discovered. In such a way, it essentially inculcates a process of continuously improving the end result. This however requires that all managers and employees be involved in it so that the source of deficiency is efficiently and correctly identified.

It is quite evident that at Toyota, it is both Kaizen and TQM that are at play, both aimed at reaching the desired level of product quality through ongoing continuous improvement achieved through participative management. At the heart of both these concepts is in fact, Deming’s early work on his fourteen points and the PDCA cycle. Just as the PDCA suggests, Toyota too starts off with planning on the needed procedures, implementing them, checking on the gaps between expectation on the actual result and immediately taking corrective measures till the optimum results are achieved.

Outcomes of Toyota’s Quality Focus

As an unchallenged fact, Toyota stands as the highest quality and most profitable automobile manufacturer round the globe. By the end of 2003, it had almost approached Daimler Chrysler’s level of production and sales. During the same time, Ford’s global market share had also been overtaken by Toyota as the world’s second largest car manufacturer.

The source of such massive success? Toyota’s ever increasing emphasis on improving the product quality and engaging its work force in the process. This it did and does by making the higher level managers only a helping hand in letting the line managers and the direct workers better understand the Toyota Production System (TPS). Doing so not just improved the quality and reliability of the products and the related processes but also the expertise of its work force. Resultantly, its employees feel empowered, satisfied and more motivated to work on reducing the gap between the actual quality and that expected expectations.

Toyota’s commitment to quality recently led it to become the world leading car manufacturer when it grew past General Motors in 2007. All a result of its high worker involvement and quality standards, the source of Toyota’s success also entails the resultant increase in employee motivation, commitment and alignment of personal goals with the company’s which in turn has a positive impact on its market share and thus, its profits. It is also to be noted that these efforts greatly helped reducing the lead time which too had a positive impact on its bottom line.

The Next Step

When the automobiles are built with a strict focus on high quality standards such that continuous improvements are made until the desired outcome is reached, one of the major results that turn out is the continuous learning that the workers undergo during the process. This mainly comes due to the participative management style implemented by the company. Consequently, each worker gains on his expertise related to automobile manufacturing and that too of exceptional quality. But when this happens, there is every possibility that the rival organizations try to attract the human resource through sizeable remuneration packages thereby incurring for Toyota a cost greater than any monetary cost that it may have incurred at any point in time.

In order to protect its human capital, Toyota must keep on training and increasing the expertise of its work force but must try to keep them with the organization unless the newer workforce members are trained enough for further and better measures. One way of doing so would be to engage them in a contract based employment. This would ensure that until a new and better quality improvement strategy is in place, the company is able to retain its well trained work force. In order to motivate them to improving their own learning, Toyota may link rewards with a specific performance level. It must be kept in mind, however, that it must be team effort that is rewarded since rewarding individual efforts might end up in the entire exercise back-firing.

Another measure that Toyota might like to take is to introduce more formal ways of learning as well and associate any such training with a certification so that the workers might be able to have a sense of achievement along with having the job related skills developed as well.

Additionally, Toyota may assign a dedicated team as the quality assurance department. After having gained experience with the application of different methods for production, they might be better able suggest on whether there would be large quality gaps between the expected and the actual result even before it has actually been put in the process of production. Also, if more R&D efforts made in order to at least statistically manage the optimum product and process design, loop holes that were to appear at a later stage may be identified much earlier on. Resultantly, producing the automobile with the optimum quality would be started off from the very design stage. Again, this would require a dedicated team that works solely on this area and may take input from the other departments if required. Thus, R&D should not only be restricted to producing innovative and reliable designs but work such that the later loop holes can be identified beforehand.

Conclusion

Over time, quality and its related concept have undergone serious change. Although this change has been for the better, their appropriate application requires total commitment and a strong focus on improving the product/service quality. The post World War era was where the actual development started and W. Edwards Deming is amongst the most eminent of the people who contributed to it. Amongst several others, Toyota has adopted the updated versions of his basic theory in the most successful manner. By introducing the principles of continuous improvement through participative management has brought to the company an increase in both market share and profits. However, for long term sustainability, the company and its management must ensure that the work force stays committed to the same objective of making the highest quality automobiles and keep them sufficiently motivated through an appropriate reward and remuneration system. This, along with a focus on further R&D is likely to enable Toyota to sustain is current top ranked position in the long run.

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