Page 186 - DMGT501_OPERATIONS_MANAGEMENT

Operations Management

Notes Without a proper frame of measurement, a company cannot assess and evaluate the success
or effectiveness of its efforts towards improving the cost and quality of its operations and
outputs.
5. The concept of employee involvement is essentially concerned with extending decision-
making to the lowest possible hierarchic level of the company. It also denotes a high level
of workers’ motivation and morale and their identification with the goals of the
organisation. A high level of employee involvement, i.e., their motivation, commitment
and empowerment towards productivity, innovation and problem-solving, depends on
the strength of an organisation’s culture, i.e., its system of shared values, beliefs, norms
and vision.
6. The concept of small-group activities is closely aligned with employee involvement.
Small voluntary groups of workers known as quality circles or productivity teams represent
a mechanism for evoking, sustaining and utilising employee involvement. Small-group
activities represent a powerful way of improving productivity, quality and work
performance in the organisation in a continuing manner.
Six Sigma or Zero Defects in TQM: Six sigma is a major part of the TQM programme. It is defined
as 3 to 4 defects per million. It stresses that the goal of zero defects is achievable. The concept and
method of six sigma is applicable to everyone and to all functions, i.e., manufacturing,
engineering, marketing, personnel, etc. As a concept, it aims at reducing process variation and
reducing and finally eliminating all defects. As a method, it aims at the output of work, the
customers of that output, customers’ critical requirements, suppliers and the firm’s critical
requirements of them, the processes used by the firm and the tools and approaches for
continuously improving the firm’s processes. Six sigma, in essence, is a measure of variation.

Methodology of Six Sigma

The application of six sigma as a concept and a method involves the following six steps:
1. Specify clearly the products or services, i.e., the output, you provide. These include output
from your processes that the customer receives from you and which incorporate your
value-added element.
2. Specify the customers of the output and determine what they consider important.

3. Identify your suppliers and specify your critical requirements of them. Your ability to
satisfy your customers depend on the ability of your suppliers to meet your critical
requirements.
4. Delineate the process for doing your work. Map key sub-processes or activities and identify
tasks, decision-points, storage points, wait points or queues, workflow and items of rework.
5. Examine each link or step in the process with a view to assess whether or not it adds value
to the product or service to satisfy the customer. Improve the process in the light of such
an examination.
6. Continue the improvement process by measuring and analysing defects or deficiencies
and then proceed towards removing them in a planned manner.

Integrative Focus of TQM

The TQM system is integrated around the central concept of Total Customer Satisfaction. The
concept is not restricted to the manufacture of zero-defect products. It extends to and encompasses
continuing changes or improvement in the product based on feedback from the customers
regarding their preferences and expectations regarding the performance of the product. This
aspect is also known as the practice of ‘experience or design looping’ in Japanese firms. It

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