Importance of TQM and Six Sigma in Industries

The article discusses the importance of Total Quality Management (TQM) and Six Sigma in industries. It covers the role of technology, difficulties in application, and impact on supply chain management. The article also explains the 14 points of TQM and the reasons why some companies do not use Six Sigma. Desklib offers solved assignments, essays, and dissertations for various courses and universities.

Running head: TQM AND SIX SIGMA
TQM and Six Sigma in Industries
Name of the Student:
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TQM AND SIX SIGMA
Table of Contents
Introduction:...............................................................................................................................3
14 points of TQM:......................................................................................................................3
Six Sigma-reason of some companies for not using it:..............................................................5
Role of technology Six Sigma:..................................................................................................5
Difficulty in application of Six Sigma:..................................................................................6
Effect of Six Sigma and total quality management on supply chain management (SCM):.......7
Gap analysis:..............................................................................................................................7
Steps of operations in flow chart:...........................................................................................8
True quality applied:..............................................................................................................9
Global Quality:.....................................................................................................................10
Functional quality:...............................................................................................................10
Steps of recognition of error in flowchart:...............................................................................11
2. Recognise the path:..........................................................................................................11
Areas of mistake:..................................................................................................................11
Decision tree:...........................................................................................................................12
Quality issue:........................................................................................................................12
Cost issue:............................................................................................................................13
Necessary issues:..................................................................................................................13
Recommendations (Combination of TQM and JIT approach):...............................................13
Summary/Conclusion:..............................................................................................................14

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References:...............................................................................................................................15

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TQM AND SIX SIGMA
Introduction:
The aim of the assignment is to study the importance of total quality management or
TQM and Six Sigma in business corporations. Total quality management refers to
management of total operations to bring about improvement in the performance of the
organisation as a whole. Technology plays an important role in this field. The use of six
sigma includes the use of high quality technology. The use of technology has innumerable
amount of benefits and the six sigma is highly dependent on the advanced technology. The
application of TQM is widely accepted in companies, especially multinational companies
industries all over the world. Some of the companies using TQM are Unilever from fast
moving consumer goods industry, Volkswagen from the automobile industry and Apple from
electronics industry.
Six Sigma refers to collection of techniques, tools and procedures to improve
manufacturing methods. The multinational corporations perceive Six Sigma as a
technological aspect, which involves installation of multitasking machinery. The use of high
level of Sigma refers to the cutting down of huge costs. There was a condition were the
company used the four-sigma level and it would be producing products at the rate of 6,200
defectives for every million they produce in such case. The technology has adverse effects. It
is costly and sometimes it suffers from technical glitch which results in inappropriate
functioning. It is impossible for many companies to afford as it is costly and it requires a well
structured system to apply the same. Motorola from telecommunication industry and
Amazon, the ecommerce giant are some of the companies using Six Sigma.
The past two decades have witnessed an enormous growth of interest and concern
with predicting and controlling the social impact of technology both anticipating new
technologies and their social and environmental implications and it results in the

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consequences of the ever-lasting scale of application of older technologies. On contrast to
that the deployment of technology turns out to be more extensive and the technology
sometimes it grows more complicated. It might require the need of one`s basic knowledge
which is related to the use of technology. The purpose of the study is to analyse the six sigma
strategy and the application of six sigma. The report further concentrates on the difficulty of
using the six sigma and the reason why most of the companies cannot afford the six sigma.
The report further concentrates on the role of technology in the use of six sigma and the
difficulties which is the contrasting qualities that are related to the use of six sigma.
14 points of TQM:
The following are the 14 points of TQM that Edward Deming proposed:
1. Manufacturing companies should bring about continuous improvement in the products.
2. The multinational companies should incorporate the changes in the external market
environment in various fields like politics and economics in their business strategies.
3. The manufacturing companies should perceive quality as a means to achieve customer
satisfaction and not as a tool to qualify quality audit.
4. The manufacturing companies must collaborate with selected suppliers which provide high
quality raw materials as per the quality parameters set by the central quality department. This
will result in production of higher quality goods.
5. The manufacturing firms should introduce better versions of their existing products and
new improved products on regular basis.

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6. The management, human resource departments and the heads of the departments should
analyse the training needs of the employees on regular intervals and apply appropriate
training techniques to improve their efficiency and knowledge.
7. The apex management should set examples before the subordinates by following ethical
ways of company policies like providing equal opportunities to employees from diverse
cultural backgrounds.
8. Employees holding top and middle levels in the organizations must counsel the subordinate
employees to help them deal with fear and insecurities they have regarding their job security.
9. The organisational culture of business organisations should emphasise on transparent
communication among the employees across different hierarchies and department.
10. The apex management should ensure that superior employees do use unethical means like
coercion and threats to make their subordinates work.
11. The departmental heads should aim to divide the total target among the team members on
the criteria like educational qualifications, experience and skills.
12. The heads of the deparments should judge the performance of the employees on the
grounds of qualitative and quantitative parameters. The quantitative parameters can nclude
the actual performance achieved by the employees against the targets assigned to them
whereas the qualitative parameters can include the innovative power of the employees.
13. The organisational culture should encourage continuous development among the
employees.
14. The employee policies of the organisations should provide opportunities to employees to
achieve career growth and appraisals.

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The reasons of not using six sigma:
According to Pyzdek and Keller (2014), Six Sigma requires manufacturing companies
to bring about radical improvements in their production process like installation of advanced
multitasking machinery using less fuel. The companies usually initiate pilot projects to
facilitate these technological up gradations. These projects also necessitate employment of
more skilled employees, making of new plans and allocation of resources. These processes
require huge initial mobilization of resources, which small firms cannot afford. These
limitations of resources, which small firms encounter, prevent them from adopting Six Sigma
(Corrigan, 2015).
Role of technology in Six Sigma:
According to Pyzdek and Keller (2014), technology occupies a pivotal role in Six
Sigma. This is because adoption of Six Sigma requires the manufacturing companies upgrade
their manufacturing processes to minimise errors due to technical faults. The production
processes traditionally consisted of producing goods for sale in the market and earning
profits. The producers were not concerned about use of technology and the production
processes led to wastage of materials. The modern production processes in comparison to
their predecessors involve use of more high-end technology, which facilitates complete
scanning of the production process. The diagram below shows that companies use Six Sigma
to monitor the production using flowcharts and graphs to minimise defects in production to
ensure that the finished products are of high quality. The companies as pointed out have to
start pilot projects to adopt Six Sigma and technology plays key in management of these
projects. However, technology is not the only important factor in Six Sigma applications. The
companies have to train their employees to operate these modern plants and machineries to
succeed in application of Six Sigma. Thus, this analysis shows that in contrast to the notion

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that technology is the most important component of Six Sigma, factors like skills and
competencies of the staff members operating machinery play important roles as well.
Figure 1. Diagram showing Six Sigma
(Source: sixsigmadaily.com, 2017)
Difficulty in application of Six Sigma:
Six Sigma demands huge mobilisation of resources, which requires immense
investments from the companies, which makes it difficult for these companies to adopt it. Six
Sigma, just like TQM, requires companies to invest huge amount of money towards adoption
of technology, mapping the entire production process to locate and remove any shortfall. The
companies require taking steps to rectify these shortfalls by adopting ways like training the
employees. An analysis of the companies using Six Sigma shows that most of the companies
following the system are multinational companies who can mobilise this immense amount of
resources. This analysis shows that the small companies usually do not have access to the

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huge resources which application of Six Sigma requires. This makes application of the
process difficult especially in small firms with limited market and resources.
Effect of Six Sigma and total quality management on supply chain management (SCM):
Applications of Six Sigma and TQM have deep impacts on the supply chains of
business organisations. This is because the new modern machinery require raw materials
which are capable of being processed by those machinery. This requires the firms to acquire
higher quality raw materials (Albliwi et al., 2014). This opting of higher quality raw materials
result in the firms restructuring their supply chains to be able to hire suppliers supplying high
quality materials. This analysis shows that applying Six Sigma and TQM results in firms
revamping their supply chains. This often leads to removal of suppliers providing low quality
materials and additions of suppliers providing superior quality raw materials (Ellis et al.,
2014).
Gap analysis:
Gap analysis involves business organisations to compare between their present
standards of performance against the performance they seek to achieve. The main aim of gap
analysis is to optimise resource allocation and integration of inputs at all levels of an
organisations like top management level and middle management level. As shown in the
figure below, the project managers in the firms conduct an analysis of the present level of
performances to locate the faults and shortcomings in areas like allocation of resources and
level of technology. The managers who monitor the allocation and project flows document
them in special charts as shown in the diagram to analyse the gaps or faults in them. The
production managers then form strategies to rectify the areas of shortfall to minimise the gap
between the target performance and the actual performance achieved (van Ittersum et al.,
2013). An analysis of the practices of the multinational companies reveals that they seek to

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Standard performance level
Measure the current skills in the organization
Gap analysis
upgrade their levels of performances by taking action plan like installing machinery,
restructuring their human resources and adopting cost effective methods of operations. This
evaluation shows that the companies use Six Sigma and TQM to bridge the performance
gaps.
Objectives Current Standing Deficiency Action Plan
1. To be filled by the
project managers
To be filled by the
project managers
To be filled by the
project managers
To be filled by the
project managers
2. To be filled by the
project managers
To be filled by the
project managers
To be filled by the
project managers
To be filled by the
project managers
Figure 2. A Gap analysis chart
(Source: Author)
Steps of operations in flow chart:
The following flow chart shows that steps managers can take to analyse the gaps in
performances of organisations:
Efforts of measuring the levels of
performance.

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TQM AND SIX SIGMA
Figure 3. Flowchart showing Gap analysis
(Source: Author)
The figure above shows four steps to analyse the gaps in performance of the
employees. The first step consists of planning to measure the performance present in the
organisations like supervising the tasks performances and mistakes of the subordinates. The
next steps consist of identification of the level of performance the apex management expects
employees to achieve as per industry standards. The managers in the third steps measure the
actual level of performance of the employees by analysis of productivity charts and mistakes
they monitor in the first step (Ellis et al., 2014). The managers then compare between the
target and actual levels of which is the gap. They then take steps to bridge or at least
minimise the gap by applying employee performance development methods like training.
True quality applied:
True quality in products can be defined as attributes which these products superior to
their counterparts. Experts perceive true quality as the outcome of technological expertise the
companies gain by installation of new manufacturing plants. The customers perceive products
manufactured using advanced technology superior. This perception has led the manufacturing
Measuring the actual
performance
Measuring of the
expected performance.

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companies upgrade their production technology to manufacture products of superior qualities
(Flanagin et al, 2014). The traditional production processes stressed on the production
concept where the manufacturer offered goods without considering consumer preferences.
Quality was essentially an attribute in the products, which the producer infused to create
utility for the user. The modern production process in comparison to traditional process views
quality as the ability in the products to create and maximise customer satisfaction (Ellis et al.,
2014). This results in revenue generation and the company can earn high market position.
This analysis shows that true quality are the attributes present within products which creates
customer satisfaction and generate high revenue for the manufacturing companies.
Global Quality:
Global quality refers to the uniform high quality, which the multinational companies
maintain in all their products through the market. The concept of global quality compared to
true quality, is essentially pertinent only for the transnational corporation, which manufacture
an array of products and sell them globally. These companies maintain a high quality for their
products to ensure application of TQM and Six Sigma (Netland & Sanchez, 2014). These
companies maintain a uniform quality standard for all their products as per the parameters set
by their central quality control department. They apply global quality even during acquiring
the raw materials for their finished goods (Brettel et al., 2014). This analysis shows that
global quality enables the multinational companies to maintain high quality of their products
in all their markets.
Functional quality:
Functional quality refers to the process of the manufacturing companies to incorporate
the expectations of the consumers in their production processes to maximise their level of
satisfaction. The production managers incorporate the consumer preferences in the
production charts and plans. The process involves collaboration of various departments like

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production and marketing in the production process (Baily & Bosworth, 2014). The
production department gains information regarding the customer preferences from the
marketing department while finance department allocates funds to acquire the materials
according to the customer expectations. Thus, functional quality involves collaboration of
multiple departments like, marketing and production to ensure production of high quality
goods (Bi, Da Xu and Wang, 2014).
Steps of recognition of error in flowchart:
The following are the steps to identify and recognise the errors in flowchart:
1. Define the target:
The production manager should define the target performance, which the department
wants to achieve for a particular period. They should define a set of criteria, which every
product has to satisfy to pass the quality tests. The quality parameters as pointed out above,
should emphasise on the benefits which the consumers can derive upon consumption of the
products.
2. Recognise the path:
The production managers after defining the quality parameters should define the path
the production process should follow. They should manage the steps of production towards
the path.
3. Measure the actual flow of process:
The production manager should measure the actual flow of the production process.
They should take steps to rectify the diversion of the path taken for the predetermined plan.

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Areas of mistake:
The errors or mistakes in the production process can take in three areas namely,
technological, human and design. Technological error refers to incidences like machine
breakdown, which intervenes smooth production. The human error refers to wrong operations
or decision making by the operators or managers respectively (Brettel et al., 2014). Design
errors refers to faulty design of the products which minimises the utility the products cause to
the customers like extra heavy weight which prevents the customers from carrying the
products with ease (Flanagin et al, 2014).
Decision tree:
The decision tree refers to the flowchart which points out the possible paths which the
managers can follow to manufacture their products. For example, in the below diagram, the
raw materials can pass through three ways. The first way can lead to machine breakdown
while the second way is smooth. These two ways are cost effective but lead to manufacture of
grade 2 products. The way 3 is expensive but leads to production of high quality products.
The manager should take decision regarding the path the production process is to follow.
Figure 4. Decision tree
(Source: qualitydigest.com, 2017)

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Quality issue:
As discussed, business organisations must seek to manufacture high quality products
to maximise customer satisfaction. The organisations should make strategies to deal with six
main quality issues namely, duplicate products, incomplete data about products that hinders
smooth production, products with faulty designs not following the demands of the customers,
raw materials difficult to acquire, system up gradation and loss or theft of data related to
product design (Baily & Bosworth, 2014).
Cost issue:
The manufacturing companies should apply TQM and Six Sigma to reduce their cost
of production. This will help them manufacture high quality products which they could sell to
a huge consumer base and earn high revenue. They can distribute the costs over a huge body
of revenue (Frias‐Aceituno, Rodríguez‐Ariza & Garcia‐Sánchez, 2014).
Necessary issues:
The necessary issues refer to issues, which do not relate to production but the
processes that come after production. The issues like after sales issue and service issues fall
in this category.
Recommendations (Combination of TQM and JIT approach):
The following recommendations can be made in the light of the above discussion:
1. One can recommend in the light of the above discussion that the manufacturing companies
should apply TQM and just in time (JIT) to acquire raw materials and ensure smooth
production. They should upgrade their production processes by installing modern machinery,
which reflects the amount of materials left to be processed. The production manager as a
result would be able to use the JIT method to order for the raw materials.

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2. The multinational companies should support smaller firms in adopting Six Sigma and
TQM. This would ensure their smooth production and prevent these firms from acquiring
excess raw materials, thus ensure that funds do not stay locked in raw materials and ensuring
liquidity.
Summary/Conclusion:
Therefore considering the above discussion this can be stated that the manufacturing
organisations should apply TQM and Six Sigma to improve their production processes as it is
technologically advanced and the use of it is innovative. It further helps in the reduction of
the cost and hence for the companies to use it. They must maintain superior quality of their
finished goods to maximise the benefit of the consumers. The multinational companies
should align their manufacturing processes with the consumer needs. These companies
should assist the smaller companies in adoption of Six Sigma and TQM in their operations as
well.

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References:
Albliwi, S., Antony, J., Abdul Halim Lim, S., & van der Wiele, T. (2014). Critical failure
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Quality & Reliability Management, 31(9), 1012-1030.
Baily, M. N., & Bosworth, B. P. (2014). US manufacturing: Understanding its past and its
potential future. The Journal of Economic Perspectives, 28(1), 3-25.
Bi, Z., Da Xu, L., & Wang, C. (2014). Internet of things for enterprise systems of modern
manufacturing. IEEE Transactions on industrial informatics, 10(2), 1537-1546.
Brettel, M., Friederichsen, N., Keller, M., & Rosenberg, M. (2014). How virtualization,
decentralization and network building change the manufacturing landscape: An
industry 4.0 perspective. International Journal of Mechanical, Industrial Science and
Engineering, 8(1), 37-44.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Corrigan, J. S. (2015). Investigating the Use of RFID Technology in the Reverse Logistics of
End-of-Service-Life Helicopters: A Hybrid Approach Based On Design for Six Sigma
and Discrete-event Simulation (Doctoral dissertation, Concordia University).
Ellis, S. C., Goldsby, T. J., Bailey, A. M., & Oh, J. Y. (2014). Teaching lean six sigma within
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Journal of Innovative Education, 12(4), 287-319.
Flanagin, A. J., Metzger, M. J., Pure, R., Markov, A., & Hartsell, E. (2014). Mitigating risk in
ecommerce transactions: perceptions of information credibility and the role of user-

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generated ratings in product quality and purchase intention. Electronic Commerce
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environment, 23(1), 56-72.
H. Netland, T., & Sanchez, E. (2014). Effects of a production improvement programme on
global quality performance: The case of the Volvo Production System. The TQM
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Prashar, A. (2014). Adoption of Six Sigma DMAIC to reduce cost of poor
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van Ittersum, M. K., Cassman, K. G., Grassini, P., Wolf, J., Tittonell, P., & Hochman, Z.
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