liability cost that is jacked up by lawyers who work on contingency fees and unfair rewards given by juries.
Deadly diseases 1, 3, 4, and 5 can usually be taken care by using a total quality approach to quality management, but this topic is beyond the scope of this book. However, deadly diseases 2, 6, and 7, add major costs to the organization without contributing to the health of the business. They are more cultural problems, but they pressure companies to implement quality improvement and consequently compete globally.
1.3.2.4 Eliminating Productivity Quotas
Numerical quotas for hourly workers to measure work standards have been a common practice in America. This is done by the Human Resources (HR) department to estimate the workforce that the company needs to manufacture X number of parts. While doing these estimates, it could be that nobody bothers to check how many of the manufactured parts that have been produced are defective, or how many of them meet the specifications set by customers or will be rejected/returned. HR normally does not take into account the cost of such events – which, of course, the company has to bear because of rework on defective or nonconforming parts or rejected and trashed parts. All of this adds to the final cost.
In setting up numerical quotas, the average number of parts produced by each worker is often set as a work standard. When we take an average, some workers produce a smaller number of parts than the set standard, and some produce more than the set standard. No consideration is given, while setting the standard, to who produced a small or large number of parts that meet customer specifications. Thus, in this process, workers who produce more parts than the set standard – regardless of whether the parts meet the specifications – are rewarded, while other workers are punished (no raises, no overtime, etc.). This creates differences between workers and, consequently, chaos and dissatisfaction among workers. The result is bad workmanship and more turnover, and workers are unable to take the pride in their workmanship to which they are entitled.
1.3.3 Implementing Quality Improvement
It is the responsibility of top management to lead the quality improvement program and, by removing any barriers, to implement the quality improvement program. Then the process owners have the responsibility to implement quality improvement in their company or organization. To do this, they first must understand that quality improvement takes place by reducing variation. The next step for them to understand is what factors are responsible for causing variation. To control such factors, the best approach is if management collaborates with the workers who work day in and day out to solve problems, who know their jobs, and who know what challenges they are facing. By collaborating with workers, management can come to understand everything about quality improvement and what is essential to achieve it. This, of course, can be achieved if management has better communication with those workers who do work for quality improvement.
The next step after the implementation of quality improvement is to focus on customers and their needs. By focusing on customers, loyal customers are created, and they can be relied on for the future of the company. Note that when there is focus on the needs of customers, the use of SPC tools becomes essential to achieve the company's goals, which in turn helps improve quality on a continuous basis. According to Crosby, quality improvement is based on four “absolutes of quality management”:
1 Quality is defined as conformance to requirements (a product that meets the specifications), not as “goodness” or “elegance.”
2 The system for causing quality is prevention (eliminating both special and common causes by using SPC tools), not appraisal.
3 The performance standard must be zero defects, not “close enough.”
4 The measurement of quality is the price of nonconformance (producing defective parts, or parts that do not meet specifications), not indices.
Thus, to implement quality improvement, top management should follow these absolutes. Management must also implement training for workers so that they understand how to use all the tools of SPC and thus can avoid any issues that infiltrate the system. Management must make sure that supplier(s) also understand that quality improvement is an ongoing part of the company's policy and get assurance from suppliers that they will also use SPC tools to maintain the quality of everything they supply.
1.4 Managing Quality Improvement
Managing quality improvement requires accountability, daily defect analysis, preventive measures, data‐driven quality, teamwork, training, and optimizing process variables.
Managing quality improvement is as important as achieving improved quality. Managing quality improvement becomes part of implementing quality improvement. Quality management plays a key role in the success of achieving total quality.
Hiring a consulting firm that “specializes in quality improvement” and not taking control into their own hands is the biggest mistake made by top management of any organization. Hiring a consulting firm means top management is relinquishing their responsibility for sending the important message to their employees that quality improvement is a never‐ending policy of the company.
Top management should play an important role in team building and, as much as possible, should be part of the teams. Top management and supervisors should understand the entire process of quality improvement so that they can guide their employees appropriately on how to be the team players. Teamwork can succeed only if management supports it and makes teamwork part of their new policy. Forming a team helps to achieve quality improvement, and establishing plans is essential: it is part of the job or process of managing quality improvement.
Another part of quality improvement is that management must provide the necessary resources and practical tools to employees who are participating in any project to achieve quality improvement. Arranging 5‐ or 10‐day seminars on quality improvement for employees without giving them any practical training and other resources is not good management practice.
1.4.1 Management and Their Responsibilities
The management of a company must create an environment of good communication so that everyone in the company knows their duties and goals or purpose. Management must make sure the purpose remains steadfast and does not change if a top manager leaves the company. Management must keep the communication lines with employees open so that they know which direction the business is moving and what their responsibilities are to take the business where it would like to be in 5 or 10 years. In discussing his 14 points, Deming says, “Adopt the new philosophy. We are in a new economic age created by Japan. Western management must awaken to the challenge, must learn their responsibility, and take on leadership for change.”
It is the responsibility of management to have a continuous dialogue with customers and suppliers. Both customers and suppliers play an important role in achieving quality improvement. Management must make a commitment to sustained quality improvement by providing resources for education and practical training on the job and showing their leadership. This can be done if they are willing to increase their understanding and knowledge about every process that is taking place to improve quality. Leadership that just passes on orders but doesn't understand anything about the processes that are in the works or under consideration for the future will be disappointed and will also disappoint their customers and investors.
1.4.2 Management and Quality
In this modern era, management and quality go hand in hand. Global customers are not only looking at the quality of the product they buy but also are looking at who manufactured it and how much
