Groenevelt (1993) argues that JIT systems require fewer managers and result in a reduction of the number of layers of management. In other words, lean production systems such as JIT remove the secondary and support functions in a manufacturing firm by giving more responsibility to workers on the shop floor. The need for fewer managers results in fewer layers of management with the remaining managers having wider spans of control. Lean production systems generally have been found to have wider, flatter structures than traditional firms (Huson and Nanda, 1995). This suggests that JIT also should be associated with flatter, wider structures - that is, hierarchical layers should be lessened and spans of control should be wider with the adoption of JIT. More specifically, JIT promotes reduction of waste of all kind within the logistics area cited in (Claycomb et al. 1999)’.
The Origins of JIT
‘JIT production, developed by the Toyota Motor Corporation, became known to the industrial west in the 1970s (Co and Sharafali, 1997). Management at Toyota formalized JIT after visiting a supermarket in America. The management team realized that the supermarket operation was very efficient because there was little on hand inventory and virtually no inventory in storage. Deliveries to the supermarket were made daily and the shelves were also restocked daily. When the last of the old produce is being sold off the shelves the new produce arrives just in time. The system seemed very efficient to the management team as there was little inventory holding cost associated with such an ordering process. The management team decided to apply the JIT system they observed in American supermarkets to Toyota's manufacturing setting. The result was a very efficient and widely adopted system of inventory control cited in (Aghazadeh, 2001)’.
‘Overall requirements for proper materials at the right time
- an acceptable level of quality;
- on-time delivery schedule;
- Reasonable cost (Galhenage, 1997).
Quality
Quality is an integral part of a JIT program. Rather than assessing quality control at the final inspection of completed items, the quality control staff is concerned with the prevention rather than the detection of defects. By changing the role of the quality control (QC) staff, many organizations can reduce the number of QC members and assign the traditional responsibilities of QC to production departments. The remaining QC staff members work closely with production workers teaching them techniques in statistical quality control (SQC) so they may identify and resolve minor quality problems. Quality control staff also trains suppliers in SQC so they can use these techniques to improve their products (Ansari and Modarress, 1990).
While SQC is a commonly used statistical quality tool, many other tools are available to assist in the quality control area including frequency charts, scatter graphs, and Pareto charts. In addition to the above mentioned SQC process, the Pareto chart is also an excellent tool for several reasons. The charts are easy to construct as well as flexible in their application. The chart formulation is based on the premise that 20 percent of the quality control occurrences account for 80 percent of the total value of the occurrences (Duncan, 1988).
The quality component of the JIT system cannot be overlooked. JIT allows immediate feedback to the production line so that when defects occur problems are detected and remedied easily. Moreover, only a few items in the production process are adversely affected. The traditional manufacturing system can delay the quality inspection process for days or even weeks. By the time QC detects a defect; production has manufactured and stored many problem parts in finished goods inventory. The cost of quality with the JIT system is much lower than the wait-and-see system of traditional manufacturing. Several types of costs related to specific quality problems and solutions are shown in Table I.
Summary
Figure 1 illustrates the relationship between the JIT manufacturing process and a typical inventory system. The JIT system runs smoothly with no peaks or valleys. The typical inventory system, on the other hand, is fraught with peaks and valleys that represent costs to the organization in the form of inventory holding costs, back order and stock-out costs, overtime and idle time labour costs, and waste of materials and space.
The beauty of the JIT manufacturing process is that the entire operation is continually improved upon and is not static but rather dynamic in nature. The process is not thought of as a short-term investment but rather a long-term philosophy of company management that yields many benefits. As previously discussed, several items are key "building blocks" to the JIT manufacturing process. These blocks include the commitment of all employees in the organization, having the proper materials at the right time, supplier relationships, and quality aspects and personnel considerations. As demonstrated by the Japanese since the early 1950s, the JIT manufacturing process allows an organization to make use of scarce resources and eliminate waste in the search for the elusive profit dollar. By implementing the JIT manufacturing process, organizations in the global marketplace can prosper in the face of scarce resources as the Japanese have since the early 1950s cited in (Swanson et al., 1998)’.
TQM – A Template for Business Success
‘‘Quality is not a new or recent development. Although much of the business literature on the subject of quality is fairly recent, in that it was written in the later half of the twentieth century, quality has been an integral component of cultures throughout the world for several millennia. One only has to consider the architectural genius in the magnificent Egyptian pyramid at Giza to appreciate the importance of quality to many cultures.
In fact quality has become an increasingly predominant feature of our lives. Nowadays people are constantly involved in the search for quality products and quality services. The existence of this desire for quality has caused industries and organisations throughout the world to attempt to develop a philosophy which can deliver customers the quality they require. Total quality management (TQM) is one such philosophy which aims to provide organisations with a template for success through customer satisfaction cited in (Walsh et al., 2002)’.
‘The philosophy, theory, practice and terminology of total quality management (TQM) has emerged and has continuously developed over the last circa 15 years (Boaden, 1997). A key characteristic of TQM throughout this period has been the positive effect on organisational improvement in times of change in both markets and organisations. However, (Dale et al., 2001) argue that TQM is still in the early stages of theory development and that future theoretical development incorporating "appropriate management theories" needs to be realised before TQM can reach a "refined" stage of development. (van der Wiele et al., 2000a) contend that the progression of self-assessment from an ISO to business-excellence-model (BEM) environment is an indicator of TQM growth and development. Moreover, business process reengineering (BPR), six sigma and other developing methodologies are steps along this pathway of development (Dale and Lascelles, 1997; Kruger, 2001) cited in (McAdam and Henderson, 2004)’.
‘TQM Basic Principles
TQM principles are the main factors to guarantee the implementation of TQM a success.
Broadly speaking, they can be classified into ten major headings:
- Leadership;
- Commitment;
- Total customer satisfaction;
- Continuous improvement;
- Total involvement;
- Training and education;
- Ownership;
- Reward and recognition;
- Error prevention; and
- Co-operation and teamwork.
All these principles can be found in references by authors such as (Saylor, 1992; Hakes, 1991) cited in (Ho and Fung, 1994)’.
Key elements of a TQM Philosophy
‘Berk and Berk (1993) developed a framework which identified the central elements of TQM and the techniques necessary to support a TQM philosophy (see Figure 2).
Fig. 2: Key elements of a TQM Philosophy
This framework can be used to provide an understanding of what a TQM philosophy really involves. TQM is customer focused and revolves around the concept of customer satisfaction. However once customer satisfaction has been obtained, it must then be maintained. People by nature have limitless desires which are never permanently satisfied. Therefore TQM initiatives must include an in-built culture of continuous improvement which can help an organisation satisfy the needs of its customers on an ongoing basis.
Customers will only be satisfied by quality products which are defect free. TQM will help focus an organisation's activities on eradicating the causes of defective products thus preventing such products ever reaching the customer. Quality means continuously meeting, or exceeding, customer expectations (Reed et al., 1996). The responsibility for ensuring the success of TQM initiatives lies with each member of the organisation. A culture of universal responsibility should permeate the organisation at every level to ensure the maximum benefits are accrued.
The concept of continuous improvement is a critical success factor of any organisation and should be used as the foundation stone upon which every successful TQM initiative should be built. This view is shared by Handy (1994, p. 49) who stated "... the world keeps changing. It is one of the paradoxes of success that the things and ways that get you where you are, are seldom the things that keep you there."
As can be seen in Figure 1 the central components of TQM are supported by a number of techniques and activities. If TQM is to be successful in an organisation it must be actively supported by senior management. Schein (1991) identified one of the common causes of failure of TQM programmes as being a lack of top management commitment.
TQM in practice
A TQM philosophy offers many benefits to organisations that adopt it. The chief benefits attributable to TQM include:
- The elimination of defects;
- Reduced scrap and rework;
- Reduced levels of cost;
- Increased levels of efficiency and productivity;
- Increased employee morale and motivation.
Cited in (Walsh et al., 2002)’.
The impact of TQM on Markets
‘Globalisation among organisations responding to improved communications and market opportunities is resulting in "virtual" organisations. These organisations or business units retain core skills but also have the ability to rapidly exploit emerging market opportunities. contends that as integrated structures increase the organisational boundaries will become fluid and groups of "entrepreneurial cadres" will spontaneously form, directed from a "virtual" centre, thus questioning the concept of corporate headquarters. These networks will be able to respond rapidly to localised customer needs (Craven et al, 1996). Key factors in these networks are the dynamics of organisational change, customer characteristics and core competencies (Achrol, 1991).
TQM has a key role to play in these developments; however, TQM itself must be developed to meet this market challenge. A key tenet of TQM is customer satisfaction. In this situation the organisational and customer satisfaction demands are likely to be significantly greater than those experienced before. (Gunneson, 1997) contends that a "healthy quality process" will always ensure a quality product/service, whatever the operational circumstances. He sees empowered network teams and organisations as an opportunity for strategic quality improvement teams to function in an optimal manner. (Peters, 1992) refers to this process as "unleashing the power of subordinate units". There is also an opportunity for increased TQM-based learning and development in these networks (Beer et al, 1980). The TQM of the future must also address the issue of diversity for network organisations acting in fragmented markets. Diversity in this context refers to the different organisational forms of the networks caused by local market conditions. For example, flexible organisations (e.g. Hewlett Packard) allow groups and teams in different geographical areas to select their own TQM approaches based on market and customer needs, rather than imposing normative central office dogma (Coulson-Thomas, 1994) cited in (McAdam and Johnston, 2004)’.
‘TQM: views of the quality management gurus
Crosby, Deming, Feigenbaum, Ishikawa and Juran can be considered the most important gurus of the quality management movement. However, this does not mean that their approaches are the same.
Deming achieved great popularity in 1980 after the NBC television documentary about success in Japan where he was considered a key element. Although Deming maintained a contrary position with respect to some of the TQM elements (e.g. zero defects and quality costing) (Deming, 1982, 1986), a considerable number of authors (e.g. Davis and Fisher, 1994; Grandzol and Traaen, 1995; Milakovich, 1991; Pollock, 1993; Rago, 1994; Schay, 1993; Tamimi and Gershon, 1995) consider him as one of the main supporters of the TQM concept. English (1996) considers that Juran is related with TQM and Drensek and Grubb (1995) and English (1996) also consider that Crosby is a TQM theorist.
Hackman and Wageman (1995) state that Deming, Ishikawa and Juran can be considered the founders of the TQM philosophy, "since TQM drinks in their works". Surprisingly, they do not mention Feigenbaum, the originator of the term TQC, which as shown in this paper has many similarities with the term TQM. However, they also consider that "what many organisations are actually implementing is a pale or highly distorted version of what Deming, Ishikawa and Juran laid out".
Juran does not use the term TQM in his main book Quality Control Handbook (Juran and Gryna, 1988; Juran et al., 1974) nor in Juran on Planning for Quality (Juran, 1988). In A History of Managing for Quality he uses less than one page to explain TQM and considers that the best definition of TQM can be found in the "criteria used to judge the applications for the USA's Malcolm Baldrige National Quality Award" (Juran, 1995). Neither does Crosby in Quality Is Free (1979), nor in Quality without Tears (1987) nor in Completeness. Quality for the 21st century (1992) cited in (Martinez-Lorente et al., 1998)’.
Relationship of TQM and E-Business
‘From a cursory view, the rapid development of e-business would appear to have by-passed the TQM discourse given the paucity of systematic research specifically on e-business and TQM. However, many of the aspects of e-business are addressed by TQM principles without the use of e-business terminology. For example, (Morency, 2000; Biggs, 2000) list business process mapping and improvement, competitive intelligence (Benchmarking), customer knowledge, supplier and network relations as key elements of an e-business strategy. All of these issues have been addressed in the TQM literature; however the full effect of technology on these issues, as represented in e-business has not been fully investigated. For example, the role of e-business in relation to TQM-based methods such as BPR and customer-supplier-chain issues needs clarification. (Ang and Finlay, 1999; Forza, 1985) state the need for more studies in the area of IT as applied to TQM principles. (Palmisano, 1998) describes e-business as operating in three ways: first, applying technology and know how to improve internal processes; second, applying this process approach to customers and suppliers; third, improving customer service by "tapping into the reach and availability of the internet". Thus, these principles will shape, and be shaped by, TQM in the future. One example could be the increased use of e-business technology such as option finder within the TQM management decision-making process (Optionfinder is a touch pad electronic aid for self-assessment scoring using the BEM).
Summary
In summary, the future of TQM as influenced by market changes is likely to result in less structured TQM approaches and more devolved, empowered, customer facing TQM activity. While TQM exponents may argue that these elements have been in existence for some time, there is clearly a need for TQM to become more mobile and agile to meet such challenges. Possible resultant future developments in TQM initiatives may include empowered team approaches and coping with diversity. Further large-scale changes in TQM-based customer-supplier chain relationships are also likely. Cited in (McAdam and Johnston, 2004)’.
Conclusion
Ultimately if companies want to have leaner production processes, they need to make sure they evaluate all the alternatives. It is important for managers to think creatively and use the information tools creatively. Top-level executives can be instrumental in creating a culture for continuous improvement. Empowering all floor workers, managers, and executives to use information provided by information systems, implement creative problem-solving, and share in the success of meeting greater production goals is the key to the success of lean manufacturing today.
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