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11. Remove barriers that rob the hourly worker of his right to pride of workmanship.
The responsibility of supervisors must be changed from sheer numbers to quality.
12. Remove barriers that rob people in management and in engineering of their right to
pride of workmanship. This means, inter alia, abolishment of the annual or merit rating
and of management by objective (see Ch. 3).
13. Institute a vigorous program of education and self-improvement.
14. Put everybody in the company to work to accomplish the transformation. The
transformation is everybody's job
The 14 Points
1. Create a constant purpose toward improvement.
Plan for quality in the long term.
Put your customers' needs first, rather than react to competitive pressure
and design products and services to meet those needs.
Be prepared for a major change in the way business is done. It's about
leading, not simply managing.
Create your quality vision, and implement it.
3. Stop depending on inspections.
Inspections are costly and unreliable and they don't improve quality, they
merely find a lack of quality.
Build quality into the process from start to finish.
Don't just find what you did wrong eliminate the "wrongs" altogether.
Use statistical control methods not physical inspections alone to prove
that the process is working.
4. Use a single supplier for any one item.
Quality relies on consistency the less variation you have in the input, the
less variation you'll have in the output.
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.
Analyze the total cost to you, not just the initial cost of the product.
Use quality statistics to ensure that suppliers meet your quality standards.
5. Improve constantly and forever.
Continuously improve your systems and processes. Deming promoted
the Plan-Do-Check-Act approach to process analysis and improvement.
Emphasize training and education so everyone can do their jobs better.
Treat workers the same, and don't make them compete with other workers for
monetary or other rewards. Over time, the quality system will naturally raise
the level of everyone's work to an equally high level.
13. Implement education and self-improvement.
Improve the current skills of workers.
Encourage people to learn new skills to prepare for future changes and
challenges.
Build skills to make your workforce more adaptable to change, and better
able to find and achieve improvements.
14. Make "transformation" everyone's job.
Improve your overall organization by having each person take a step toward
quality.
Analyze each small step, and understand how it fits into the larger picture.
Use effective change management principles to introduce the new
philosophy and ideas in Deming's 14 points.
cost of Quality (COQ)
Knowledge Center > Learn About Quality > Cost of Quality
Cost of poor quality (COPQ): The costs associated with providing poor quality products or services. There are four
categories: internal failure costs (costs associated with defects found before the customer receives the product or
service), external failure costs (costs associated with defects found after the customer receives the product or
service), appraisal costs (costs incurred to determine the degree of conformance to quality requirements) and
prevention costs (costs incurred to keep failure and appraisal costs to a minimum).
Cost of quality is a methodology that allows an organization to determine the extent to which its resources are used
for activities that prevent poor quality, that appraise the quality of the organizations products or services, and that
result from internal and external failures. Having such information allows an organization to determine the potential
savings to be gained by implementing process improvements.
Quality-related activities that incur costs may be divided into prevention costs, appraisal costs, and internal and
external failure costs.
Prevention costs
Prevention costs are incurred to prevent or avoid quality problems. These costs are associated with the design,
implementation, and maintenance of the quality management system. They are planned and incurred before actual
operation, and they could include:
Also, click here to watch a special video on the cost of poor quality published by the ASQ Audit Division.
Appraisal costs
Appraisal costs are associated with measuring and monitoring activities related to quality. These costs are associated
with the suppliers and customers evaluation of purchased materials, processes, products, and services to ensure
that they conform to specifications. They could include:
Repairs and servicingof both returned products and those in the field
Warranty claimsfailed products that are replaced or services that are re-performed under
a guarantee
Complaintsall work and costs associated with handling and servicing customers
complaints
Returnshandling and investigation of rejected or recalled products, including transport
costs
Philip Crosby (1926-2001) was an influential author, consultant and philosopher who developed
practical concepts to define and communicate quality and quality improvement practices. His influence
was extensive and global. He wrote the best-seller Quality is free in 1979, at a time when the quality
movement was a rising, innovative force in business and manufacturing. In the 1980s his consultancy
company was advising 40% of the Fortune 500 companies on quality management.
Key theory
Quality, Crosby emphasized, is neither intangible nor
immeasurable. It is a strategic imperative that can be
quantified and put back to work to improve the bottom line.
Acceptable quality or defect levels and traditional quality
control measures represent evidence of failure rather than
assurance of success. The emphasis, for Crosby, is on
prevention, not inspection and cure. The goal is to meet
requirements on time, first time and every time. He believes
that the prime responsibility for poor quality lies with
management, and that management sets the tone for the
quality initiative from the top.
Crosby's approach to quality is unambiguous. In his view,
good, bad, high and low quality are meaningless concepts, and
the meaning of quality is conformance to requirements. Non-
conforming products are ones that management has failed to
specify or control. The cost of non-conformance equals the cost
of not doing it right first time, and not rooting out any defects
in processes.
Zero defects does not mean that people never make mistakes,
but that companies should not begin with allowances or sub-
standard targets with mistakes as an in-built expectation.
Instead, work should be seen as a series of activities or
processes, defined by clear requirements, carried out to
produce identified outcomes.
Systems that allow things to go wrong - so that those things
have to be done again - can cost organisations between 20%
and 35% of their revenues, in Crosby's estimation.
His seminal approach to quality was laid out in Quality is
free and is often summarised as the 14 steps:
The 14 steps
1. Management commitment: The need for quality
improvement must be recognized and adopted by
management, with an emphasis on the need for
defect prevention. Quality improvement is equated
with profit improvement. A quality policy is needed
which states that ' each individual is expected to
perform exactly like the requirement or cause the
requirement to be officially changed to what we and
the customer really need.'
2. Quality improvement team: Representatives from
each department or function should be brought
together to form a quality improvement team. These
should be people who have sufficient authority to
commit the area they represent to action.
3. Quality measurement: The status of quality should
be determined throughout the company. This means
establishing quality measures for each area of
activity that are recorded to show where
improvement is possible, and where corrective action
is necessary. Crosby advocates delegation of this
task to the people who actually do the job, so setting
the stage for defect prevention on the job, where it
really counts.
4. Cost of quality evaluation: The cost of quality is
not an absolute performance measurement, but an
indication of where the action necessary to correct a
defect will result in greater profitability.
5. Quality awareness: This involves, through training
and the provision of visible evidence of the concern
for quality improvement, making employees aware
of the cost to the company of defects. Crosby
stresses that this sharing process is a - or even the -
key step in his view of quality.
6. Corrective action: Discussion about problems will
bring solutions to light and also raise other elements
for improvement. People need to see that problems
are being resolved on a regular basis. Corrective
action should then become a habit.
7. Establish an ad-hoc committee for the Zero
Defects Programme: Zero Defects is not a
motivation programme - its purpose is to
communicate and instil the notion that everyone
should do things right first time.
8. Supervisor training: All managers should undergo
formal training on the 14 steps before they are
implemented. A manager should understand each of
the 14 steps well enough to be able to explain them
to his or her people.
9. Zero Defects Day: It is important that the
commitment to Zero Defects as the performance
standard of the company makes an impact, and that
everyone gets the same message in the same way.
Zero Defects Day, when supervisors explain the
programme to their people, should make a lasting
impression as a 'new attitude' day.
10. Goal setting: Each supervisor gets his or her
people to establish specific, measurable goals to
strive for. Usually, these comprise 30-, 60-, and 90-
day goals.
11. Error cause removal: Employees are asked to
describe, on a simple, one-page form, any problems
that prevent them from carrying out error-free work.
Problems should be acknowledged within twenty-four
hours by the function or unit to which the problem is
addressed. This constitutes a key step in building up
trust, as people will begin to grow more confident
that their problems will be addressed and dealt with.
12. Recognition: It is important to recognise those
who meet their goals or perform outstanding acts
with a prize or award, although this should not be in
financial form. The act of recognition is what is
important.
13. Quality Councils: The quality professionals and
team-leaders should meet regularly to discuss
improvements and upgrades to the quality
programme.
14. Do it over again: During the course of a typical
programme, lasting from 12 to18 months, turnover
and change will dissipate much of the educational
process.It is important to set up a new team of
representatives and begin the programme over
again, starting with Zero Defects day. This 'starting
over again' helps quality to become ingrained in the
organisation.
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Further reading
Dale, B. ed. Managing quality. London : Prentice Hall, 1994
The 5th ed. 2013 is available to CMI members from CMI Library
as an ebook.
Endres, A. Implementing Juran's road map for quality
leadership: benchmarks and results. New York NY: John
Wiley, 2000
Butman, J. Juran: a lifetime of influence. New York, John
Wiley, 1997
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The Red Bull Mini is a great example of a BTL marketing campaign - free samples are given face-to-face to
people in local towns and cities.
Above The Line (ATL) and Below The Line (BTL) advertising are
two terms that are bandied around often these days in the
advertising world and often have the lay person confused as to
what they stand for. It might be worth our while to begin this by
defining what constitutes the metaphoric Line. To quote Michael
John Baker from The Marketing Book , the terms Above The Line
and Below The Line came into existence way back in 1954 with
the company Proctor and Gamble paying their advertising
agencies a different rate and separately from the agencies who
took on the other promotional activities.
What are ATL and BTL activities? They seem simple enough.
Above The Line (ATL) advertising is where mass media is used to
promote brands and reach out to the target consumers. These
include conventional media as we know it, television and radio
advertising, print as well as internet. This is communication that
is targeted to a wider spread of audience, and is not specific to
individual consumers. ATL advertising tries to reach out to the
mass as consumer audience.
Below the line (BTL) advertising is more one to one, and involves
the distribution of pamphlets, handbills, stickers, promotions,
brochures placed at point of sale, on the roads through banners
and placards. It could also involve product demos and samplings
at busy places like malls and market places or residential
complexes. For certain markets, like rural markets where the
reach of mass media like print or television is limited, BTL
marketing with direct consumer outreach programmes do make
the most sense. Says Raghu Khanna, CEO,
CASHurDRIVE, When budget is issue and the brand wants to
have a consumer connect BTL has better ROI.
Over the years I have been in contact with many companies and I have
seen different models from purchasing departments and supplier quality
approaches.
Supplier quality is the missing link between Quality and purchasing. The
target is always to apply the best quality standards to the cheapest (or
best cost concept now) suppliers in order to achieve the best results for
the company.
It makes no sense to use the cheapest suppliers and ignoring the quality
in decision-making on a supplier selection. It is necessary to involve in
an early stage Supplier Quality Management for applying their criteria.
Companies nowadays have more and more formularies, initial visits
audits and other tools to classify suppliers. Here the importance is from
purchasing to understand the minimum needs from quality to be
considered: This means that maybe the second supplier in the cost list
can be a long-term better option than the cheapest. In my opinion, it is
clear to understand that the lack of quality has a cost implication in long-
term.
On the other hand, we cannot miss the concept that all departments work
for the company profit. And therefore, introducing new suppliers in the
companies with a good purchasing strategy can end up in a market lead.
Competitors are doing it, always remember. Never underestimate
purchasing departments importance no matter if supplier quality reports
for purchasing or not.