- Customer focus: this whole effort is centred around providing a quality end-product.
- Cost reduction: machines should last longer and less involvement from specialised engineers is required. Another aspect of this point is the decrease, even elimination of defect.
- Employee Empowerment: each employee is made responsible for their own action and a spirit of openness is created via information sharing.
- Continuous Improvement: as problems arise, methods to eliminate them fully are applied to their maximum possibility.
Of course each of these aspects could be much further exploited and expanded to fully describe the Total Quality Management philosophy. Dwelling a little more on the employee empowerment point, which more broadly comes from Kaizen, a system of improvement that is applied to Total Quality Management, a philosophy within a philosophy which can be part of both home-life as well as business environment. Learning and self-improving, respect for people, education and training, team work, and quality first are the fundamental determinants of Kaizen. It involves setting standards and then continually improving those standards, improving the process rather than go for innovations and pay attention on the process rather than the results. In this respect innovation relates to meeting requirements and increasing productivity rather than developing new products. However companies need product innovation to remain competitive, and this
philosophy could obviously very much hinder their competitive advantage in this regard. Alternatively, in a Total Quality Management working environment where employees’ suggestions for improvement are expected, it does not mean that the changes made are the sole responsibility of employees. Management needs to be fully involved in facilitating process improvements and providing the required level of managerial support and decision. Additionally, Total Quality Management is subject to change and has to adapt to new conditions of work, competition and environmental situations, all driven by business innovation. The Six Sigma approach was made famous by Motorola who used a set of quality management methods such as statistical methods, and create a hierarchy of contributors based on their expertise in the Six Sigma methodology across various functions in the organization. The main purpose of Six Sigma is to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimising variability in manufacturing and business processes (Jiju, 2010). Early adopters of Six Sigma further to Motorola benchmarking their quality practices with others, were General Electric where Jack Welch introduced the method. Subsequently, Jack Welch, who became a guru of the approach, heavily capitalising on the Motorola trademark by presenting at topic-specific conferences or lecturing in prestigious business schools, defines Six Sigma as “a disciplined methodology of defining, measuring, analysing, improving and controlling the quality in every one of the company’s products, processes and transactions – with the ultimate goal of virtually eliminating all defects”. In comparison with the earlier definition from Motorola, Jack Welch widens Sig Sigma to a broad improvement concept towards achieving maximum quality rather than a simple examination of process variation.
The structured, mathematical mean of Six Sigma leads us to believe that it is likely to hinder innovation. Indeed, innovation is related to creativity and originality, two concepts that do not mix well with a structured statistical process. Innovations require a healthy tolerance of failure before it can become a satisfactory result. "Innovation is, by its very definition, based on the idea that the value resides in the introduction of something unexpected," says Dev Patnaik, a principal at Jump Associates, a design strategy firm in San Mateo, California. When it comes to the breakthrough product, or the game-changing strategic shift, Six Sigma fans can "have all the wrong reflexes," says Rita Gunther McGrath, a Columbia Business School management professor (Bloomberg Business Week, 2006). But a technology company must be innovative if it is to remain competitive. Motorola marries Six Sigma and innovation by giving free reins to designers, while dedicated members of the team keep the process close at hand, to make sure a ground-breaking project meets a measurable customer demand and gets built to quality standards. Unlike some companies newer to Six Sigma's esoteric methodology, Motorola has people who accept it as part of the culture. Veterans are used to so-
called project hoppers offering input at various stages in product development. Others agree that Six Sigma and innovation don't have to be a cultural mismatch. At Nortel Networks for instance, CEO Mike S. Zafirovski, a veteran of both Motorola and Six Sigma stalwart General Electric, has installed his own version of the programme, one that marries concepts from Toyota Motor's lean production system. The point, says Joel Hackney, Nortel's Six Sigma guru, is to use Six Sigma thinking to take superfluous steps out of operations. Running a more efficient shop, he argues, will free up workers to innovate.
In terms of innovation, although as just illustrated with the example from Motorola it is somehow possible to allow a level of innovation with quality process managements, common-sense would initially refers to them as natural deterrent. For a start, innovation is hardly measurable and cannot be considered as a process as such. Another matter which clearly demonstrates a level of incompatibility between innovation and quality process managements is explained by Benner: “creative people will push back in an environment where people are required to follow standard processes and are being measured. People who are comfortable in such an environment are not exactly the most innovative.” It is therefore suggested that companies balance out both activities: improving current operations to be competitive in the short term, while exploring new avenues for the future. Consequently, quality management should be minimised, if not absent from the departments generating innovations. Those tend to be affiliated to the Research & Development division where new products are being developed, or the Marketing division where ideas to match customer’s expectations are often generated.
Six Sigma and Total Quality Management have similarities and other compatibilities. For instance both approach relates to reducing costs that provide no value to the clients, such as eliminating wastes. The main difference between Total Quality Management and Six Sigma is the approach itself. Whilst Total Quality Management tries to improve quality by ensuring conformance to requirements, Six Sigma focuses on improving quality by reducing the number of defects (Jacowski, 2007). Total Quality Management is mostly concerned with the development and maintenance of organisational systems in business processes. It also concentrates on making incremental quality improvement while maintaining existing standards. It also sets a strong cultural environment as it focuses on creating collaboration between all functional departments within an organisation in order to improve overall quality. Although Six Sigma does not have such a strong cultural ideology, in addition to focusing on continuous improvement, it promises to achieve near perfection by restricting the number of possible defects to less than 3.4 per million (Jacowski, 2007). It is data driven and presents more tangible results, providing quantifiable and measurable outcome, which tends to appeal more to westerners. Comparatively, this latter factor is most likely the main reason why international companies adopting Six Sigma is out-weighing Total Quality Management’s.
The approach that is used for quality control also differs. One strive for increased level of performance, while the other is looking at establishing minimum sets of standards and acceptance requirements.
It is clear that industries that require higher level of precision where quality relates to tangible results such as manufacturing or engineering, Six Sigma might have more benefits due to its dependency on data gathering and variation monitoring. By following the DMAIC (Decide, Measure, Analyse, Improve, Control) project methodology for instance, one of the two developed in Six Sigma, each change implemented into a process can carefully be monitored. On the other hand, industries that are more service-based might find a better fit in Total Quality Management. Using this approach, quality is achieved by creating a cultural purpose, erasing boundaries between the divisions in the company, and ensuring that each individual is provided with the necessary training to provide the level of quality standards expected.
Six Sigma’s aim as described above is to improve the quality of set requirements by eliminating defects. What Six Sigma does not do is defining these requirements, which is highly important. One can speculate on the number of companies that have tried implementing Six Sigma unsuccessfully because their requirements were not properly defined. When requirements are being assessed, mid-term and long-term requirements as well as those relevant to the company internally and those related to external factors should be considered. Establishing such a list requires a high level of experience and knowledge. In this respect, ISO 9000 would offer a good level of compatibility. Indeed, ISO 9000 is a set of standards for the purpose of quality management systems. Companies can be accredited to being ISO 9001 as a demonstration of their conformance to the requirements set by ISO 9000. Some of the requirements for ISO 9000 are closely linked to Six Sigma or Traditional Quality Management. For example, some of its aspects relates to check output for defects or facilitate continual improvement. Although the company will have to position each ISO 9000 requirement in relation to its own industry, having a clear list of set requirements will enable the business to effectively employ Six Sigma as a quality management system within its organisation. The purpose of Six Sigma will then be to maximise each of these requirements, delivering high level of quality by eliminating errors.
Besides the discussed items above, it is interesting to note that one of the main reasons why companies are reluctant to implement quality management processes is its lack of cost-effectiveness in the short-run. Take Total Quality Management for example, although it could potentially prevent a big product recall due to a manufacturing deficiency, the upfront and
ongoing costs are substantial. To fully embrace Total Quality Management, a company has to be willing to stop its production in order to make changes to possible manufacturing processes. This is likely going to result in lack of productivity, therefore hinder the ability to deliver to customers on schedule. One has to have sufficient funds available at implementation stage not just to ensure it can cover costs for its implementation and associated expenses, but also to cushion the likely loss of immediate business. Considering that once the process is thoroughly implemented and running naturally with the organisation, the quality delivered should bring more satisfied customers to the business, the additional expenditures incurred at introduction point should be paid off via affluent new and repeated business.
The never ending quest for higher levels of quality is pushed by market globalisation and increasing litigation for product and service failure which are often thoroughly described in Service Level Agreements. The relationship between quality and market share has been proven (Biz/ed, 2010). Consequently, many organisations are now dedicating a separate function exclusively to the management of quality. Indeed high quality good and services can give an organisation a competitive edge while reducing costs, and most importantly generate satisfied customers. Because quality drives profitability and customer acceptance, it is an obvious vital strategic tool. While philosophies, concepts and methodologies are widespread to assist organisations and their operations departments improving their quality approach, this essay proves that there is not one simple recipe for success in this regard. Although we have seen that the approach to choose can be selected based on the kind of organisation in question, the precise type of service or product it offers, the size of the organisation and the readiness of its employees and managers will also be dictating the best model to adopt, as well as the level of adaptation required before implementation of such a model in the overall business. It also seems realistic to believe that as time passes and markets as well as technology evolve, new quality management approaches, methodologies and processes are likely to surface.
As a commercial-minded individual who has been spending most of the past 7 years in a sales and marketing division of a service company, learning about quality management in operations has been mind-opening. Although my experience occasionally leans towards operations management, especially when it comes to being involved in technical projects or product launch, my understanding of operations used to relate almost exclusively to manufacturing. However, further to following the Operations Management’s lectures and heavily researching the subject of quality management in operations management, I have learnt a great amount about this concept and how it can be adapted to my area of expertise. Firstly, when I am asked to deliver a quality service, I would always simply be thinking of providing perfection. But it seems that I never asked myself the right question. Indeed, regardless of how good the service is, what truly matters is how the customer perceives the quality of the service. Each individual of course has its own criteria based on personal preferences and past experiences. Price also strongly influences the customer’s view of quality. So the logical questions to ask myself should in fact be “what are my customers’ expectations and what are their perception of our service?” From there I would be able to identify the gap between expectation and perception and concentrate on the areas that truly require my attention.
Secondly, I never thought much about the impact of leadership style on quality in an operations management context. But by looking closer at some of the models used, I have been enlightened me on that front. Take for instance Kaizen, the Japanese philosophy which largely evolves around the principle that people at all levels in an organisation participate in Kaizen, from the Chief Executive Officer down to janitorial staff, as well as external stakeholders when applicable. The format for Kaizen can be individual, suggestion system, small group, or large group. At Toyota for instance, it is usually a local improvement within a workstation or local area and involves a small group in improving their own work environment and productivity. This group is often guided through the Kaizen process by a line supervisor; sometimes this is the line supervisor's key role. However in a service-related industry, the format would likely be less formal, whereby employees would be encouraged to make suggestions in a meeting or open discussion. Implementing the suggestions and motivating them to submit more improvement ideas will hopefully stimulate them. Their work lives would consequently be enhanced , and they would feel excited about their work. In other words, it empowers employees, enriches the work experience, and motivates workers. I am keen to utilise my acquired knowledge and apply them in my daily work environment.
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