Theoretical Operation Management Assignment

on

Total Quality Management and Lean Manufacturing: Through Lean Thinking Approach

Submitted To:
Prof. Arun Kumar Paul

Submitted By
Ansumani Pandey(u311056) Kamod Kr. Jha (U311072) Rahul Wahi (u311085) Vandana Kumari (U311098)

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INDEX

Abstract Introduction Literature review Methodology / Analysis of the topic Limitations Future direction Conclusion References / Bibliographies

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Abstract
Purpose: Lean Manufacturing arose from the Toyota Production System. Today the Toyota production system (TPS) is one of the most admired lean manufacturing systems in existence. Replicating the system, however, is fraught with difficulties. Most outsiders see the TPS as a set of tools and procedures that are readily visible during a plant tour. The variants of Lean Manufacturing, such as TQM, were originally founded in the Japanese automotive industry, but their evolution was mostly carried out in the West. The purpose of this paper is to make a comparative study between Total Quality Management and Lean Manufacturing with an emphasis on the Lean Thinking approach Design/methodology/approach: It rationally categorizes the related literature of various studies, analyze the literature and finally appraise and integrate it methodologically. Findings/Results: The results of this research divulge that Total Quality Management and Lean Manufacturing have much in common. Derived from Lean strategies, Total Quality Management, similar to numerous improvement approaches, can be a tool to support and create synergy for stirring up a more competitive market among companies. Key words: Lean Manufacturing, Lean Thinking, Total Quality Management

Introduction
There have been many management theories that have been presented over the years, some of which could be argued to be management fad and they have been criticized for having four major defects (Carson et al., 1999). Total quality management is a management system for a customer focused organization that involves all employees in continual improvement of all aspects of the organization. TQM uses strategy, data, and effective communication to integrate the quality principles into the culture and activities of the organization. Total quality management (TQM) and Lean Manufacturing (LM) is two management approaches to optimization, but there are various ideas and views of them. But these two are different and have their own process and methodology. TQM is The management of quality at every stage of operations, from planning and design through self-inspection, to continual process monitoring for improvement opportunities. Many different definitions of TQM have been presented over the years and some of the examples are: According to Boaden : TQM is like shooting at a moving target. While some argue that TQM is a corporate culture characterized by increased customer satisfaction through continuous improvement, in which all employees in the companies participate actively. Dale claims that TQM is both a philosophy and a set of guiding principles for managing an organization. TQM focuses on control of business processes and customer satisfaction. Activities such as improvement, statistical control, supply control and quality engineering are ingredients of TQM. TQM as a concept arises from the academic field and has contributors such as Feigenbaum, Juran and Deming. LM, also called as Lean Production (LP) which is often simply known as Lean, is a production practice that considers the

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expenditure of resources for any goal other than the creation of value for the end customer to be wasteful and thus a target for elimination; basically it refers to more value with less work. LM is a generic process management philosophy derived originally from the Toyota Production System (TPS). The term Lean was probably coined by Womack et al. in their book The Machine that Changed the World. Some authors state that a definition of Lean includes both the people and the process components on the one hand and internal (related to the firm) and external (related to supplier and customer) components on the other hand. In this sense, Shah and Wards definition of LP highlights mechanisms needed to achieve the central objective of waste elimination. So, LM is the production of goods using less of everything. In using LM with your company, the goals would be to use less waste, less human effort, less manufacturing space, less investment in tools and less engineering to develop a new product. LM is renowned for its focus on the reduction of waste, which in turn

Literature Review
This is an interesting postulation about Total Quality Management (TQM) that it is actually an old wine in a new bottle; and the various arguments in support of the process of growing a new theory from the principles of the older theories that may not have the luster of newness wafting off them comes to mind. While it is important to be continually in pursuit, both academically and professionally, of improved methods and practices in the business of producing a product or service, it is equally important not to throw out the learning's of past management theories just to grab hold of the latest findings from the newest expert. However many definition of TQM has been presented over the years. According to Boade n TQM is shooting at moving target. Some argue that TQM is like corporate culture characterized by increased customer satisfaction through continuous improvement, in all employees in the company company participated actively. Activities such as improvement, statically control, supply control and quality engineering are ingredients of TQM. Lean is about doing more with less: less time, inventory, space, labor, and money. "Lean manufacturing", shorthand for a commitment to eliminating waste, simplifying procedures and speeding up production. Lean Manufacturing (also known as the Toyota Production System) is, in its most basic form, the systematic elimination of waste overproduction, waiting, transportation, inventory, motion, over-processing, defective units and the implementation of the concepts of continuous flow and customer pull. Five areas drive lean manufacturing/production: 1. cost 2. quality 3. delivery 4. safety, and

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5. morale. Just as mass production is recognized as the production system of the 20th century, lean production is viewed as the production system of the 21st century. TQM has Kaizen as a tool for continuous work ;this is visualized by Demmings wheel. Stastical control is a powerful tool to gain control of manufacturing defects and it correlates to measurement. This paper draws attention on whether lean differs from other improvement methods (TQM) and two major differences are noteworthy. First lean main focus is in improving entire value stream while other most of the other improvement methods tend to focus on individual processes. The second important difference is that most process improvement method tends focus on productivity and efficiency of major value adding processes, whereas lean emphasize on reducing or eliminating non value adding activities i.e. waste. Principle of TQM is: 1. Be customer focused 2. Ensure total employee involvement 3. Continual improvement 4. Leadership 5. Process approach

Principal of Lean Manufacturing: Lean manufacturing is underpinned by 5 principles: 1. Specify what creates value from the customers perspective 2. Identify all the steps along the process chain 3. Make those processes flow 4. Make only what is pulled by the customer & Strive for perfection by continually removing wastes.

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TQM has become a billion-dollar industry, heavily promoted as an effective solution to management problems. However, while the advantages of TQM seem obvious, implementing TQM systems has not produced equally good results in all cases. Several researchers report that TQM programmes have produced improvements in quality, productivity and competitiveness in only 20-30 per cent of the companies that have implemented such programmes. TQM approaches are : 1) To find out the customer wants2) Keep track of results 3) Design process that facilitates doing the job right the first time Quality management can be described as management revolution, a revolutionary philosophy of management , a new way of thinking about the management of organization, a comprehensive way to improve total organizational performance, or as a Lean manufacturing can be looked at as an overall philosophy for business improvement as well as a collection of lean. These tools applied on their own without the overall framework for improvement will not be as effective as a planned implementation of lean. Framework for competition management. Problem solving tools are as much part of lean tools as they are part of quality management, the seven quality tools are well used and developed within lean and the Toyota Production System. These quality tools are used for continual improvement of processes and problem solving within any lean manufacturing or total quality environment. Total Productive Maintenance (TPM) like 5S is one of the foundation blocks of lean manufacturing and seeks to ensure that is machines and processes are reliable and efficient through improved maintenance activities and autonomous maintenance. TPM focuses on the six big losses and tries to minimize them all through a performance measure known as OEE or overall equipment effectiveness. Tom incorporates aspects of predictive maintenance and preventive maintenance but involves everyone in the organization rather than just the maintenance crew who in traditional organizations are the ones who fix machines while the operators only run them. Kaizen is continuous improvement of every aspect of your business using everyone within it. The Japanese typically use kaizen as an ongoing process of many small improvements which together add up to a major improvement across the whole company. In the west we tend to like running kaizen events or a kaizen blitzas some call them to make major step change improvements over just a few days to a week. Kaizen is very much about empowering the employees to make decisions and choose their own improvements without having to go through a complicated and lengthy approvals process or have the changes forced on them by experts. The kaizen blitz approach is very much about "just do it" (JFDI), getting out there and making things happen, a typical kaizen event will result in the re-layout of cells and other significant changes. Lean exists at two levels, having both strategic and operational dimensions ; neither of the positions is more correct than the other. In addition, Lean can be seen as having both a philosophical as well as a practical orientation. There are four definable approaches of LP. These are performative, ostensive,discrete and continuous. OM Theoretical Assignment Group No.5

Following are the comparison between TQM and Lean:

Subject

TQM

Lean

The failures of TQM implementation have been well documented: Brown et al. In more detail, Harari states that, after studying all the independent research conducted by consulting firms, the conclusion is that only about one-fifth, or at best one- third, of the TQM programs in the USA and Europe have Total Quality Management (TQM) and quality circles(QCs) became popular programs that were implemented in many organizations, but there were implementation problems. In some cases, TQM and QCs were not implemented completely, or the corporate culture was unable to adapt to these new techniques. Some employees considered these innovations little more than the latest management fad which, if ignored, would be replaced shortly by a new management fad. Some organizations realized substantial gains by implementing these techniques; others abandoned them while others maintained the names, but reverted to traditional Western approaches to quality management. This research considers the management of quality in Western organizations, how TQM has been co-opted, and techniques that might improve quality management in service industries.

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There are many reasons to introduce Lean techniques in an organization because it may contribute substantially to cutting costs and providing competitive advantages. Lean benefits include reduced work-in-process, increased inventory turns, increased capacity, cycle-time reduction and improved customer satisfaction. According to a recent survey , of 40 companies that had adopted LM, typical improvements are visible in three areas. These improvement areas are: operational improvements (reduction of lead time, increase in productivity, reduction in work-in-process inventory, etc.), administrative improvements (reduction in order processing errors, streamlining of customer service functions so that customers are no longer placed on hold, etc.) and strategic improvements (reduced costs, etc.). Despite the several success stories associated with the Lean concept, it does have some shortcomings. Examples of shortcomings that can be found in the literature on the subject are the following: The Lean organization may become very susceptible to the impact of changes. The Leanness in itself leads to reduced flexibility and less ability to react to new conditions and circumstances . JIT deliveries cause congestion in the supply chain that lead to delays, pollution, and shortage of workers and so on . To summarize, Lean requires a stable platform from which scale efficiency can be maximized. Highly dynamic conditions cannot be dealt with because there is no room for flexibility due to the focus on perfection, which is always a function of particular market conditions at a certain period of time . As a result, the analysis is done with three different aspects: basic assumptions, change principles and interventions.

Methodology/ Analysis:
As per Hellsten and Klefsjo A methodology, consists of a number of activities performed in a certain way. According to them tools are defined as: rather concrete and well-defined tools, which sometimes have a statistical basis, to support decisionmaking or facilitate analysis of data. Tools that are frequently mentioned in the TQM literature include the seven quality control tools, see Shewhart and Ishikawa and the seven management tools, see Mizuno . The improvement cycle is also a common methodology used in order to improve the business, according to Evans and Lindsay . The improvement cycle is composed of four stages: plan, do, study and act (PDSA). Total quality management (TQM) is an integrated organizational effort designed to improve quality at every level. There are many tools of lean manufacturing, many of them are not new and many have been developed and improved as part of the Toyota Just in Time JIT or Just in Time is one of the main principles of Lean Manufacturing, that of producing only what the customer wants, where the customer wants, when the customer wants it. Not producing large batches of stock that the customer may or may not require. To implement JIT you need to implement flow through your value stream and reduce batch sizes as much as possible, the ideal batch size been that of .Many people will say OM Theoretical Assignment Group No.5

that JIT is not possible in their industry, but every day we make technical advances that allow this possible in almost any industry.

. Value Stream Mapping Value stream mapping is one of the most important tools of lean manufacturing, it allows you to map out your whole value stream from materials through to your customer and identify the areas of waste and delays. Through the creation of current value stream maps you can highlight the problems and create your future state maps and action plans to improve your value streams Jidoka and Autonomation Autnonomation or Jidoka is the principle of having automation with a human touch, machines and processes that detect when something is wrong and stop to allow human intervention. Through this method one operator can watch several machines rather than being stood over the one machine waiting for something to go wrong. There are many reasons to introduce Lean techniques in an organization because it may contribute substantially to cutting costs and providing competitive advantages to the organisation. Lean benefits include reduced work-in-process, increased inventory turns, increased capacity, cycle-time reduction and improved customer satisfaction. According to a recent survey of 40 companies that had adopted LM, typical improvements are visible in three areas in the companies. These improvement areas are: 1.Operational improvements which include: reduction of lead time, increase in productivity, reduction in work-in-process inventory, etc., 2. Administrative improvements which comprises of reduction in the order processing errors and,

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3. Streamlining of customer service functions so that customers are no longer placed on hold, etc. and strategic improvements i.e. reduced costs, time etc Tools: Lean principles are fundamentally customer value driven, which makes them appropriate for many manufacturing and distribution situations. Five basic principles of LM are generally acknowledged: Understanding customer value. Only what the customers perceive as value is important. Value stream analysis. Having understood the value for the customers, the next step is to analyze the business processes to determine which ones actually add value. If an action does not add value, then it should be modified or eliminated from the process. Flow. Focus on organizing a continuous flow through the production or supply chain rather than moving commodities in large batches. Pull. Demand chain management prevents producing commodities to stock, i.e. customer demand pulls finished products through the system. No work is carried out unless the result of it is required downstream. Perfection. The elimination of non-value-adding elements (waste) is a process of continuous improvement. There is no end to reducing time, cost, space, mistakes and effort .

Limitations :
Choosing a difficult or low-impact project as the first one. Lean isnt difficult, but can be complicated because of all the variables and communication involved. If the first Lean project isnt successful or generates little return on investment, cooperation and support for future projects will fade. Overlooking administrative areas. Some manufacturing environments, especially continuous processes (e.g., high-volume chemical manufacturers) have only small or insignificant opportunities in the production or operations areas. Implementing Lean there will provide little impact. The company spends too much time on training and not "doing," or they start at the wrong place. Failing to expand lean implementation to the supply chain. Because of the need for just-in-time delivery of materials, minimization of inventories and Lean's dependence upon high quality products and services, companies need to bring suppliers into the improvement efforts. If critical suppliers cannot deliver on time, and in smaller quantities, the benefits of Lean will be greatly diminished or even non-existent. development of a lean supply chain is probably one of the most difficult tasks, but more financially rewarding, aspects of implementing Lean. Lean principles do not always apply when customer demand is unstable and unpredictable. The Leanness in itself leads to reduced flexibility and less ability to react to new conditions and circumstances. Initial introduction costs- training workers and disrupting current production whilst being implemented are high in the TQM model. OM Theoretical Assignment Group No.5

 Benefits may not be seen for several years while using the TQM model. Workers may be resistant to change may feel less secure in jobs because of the implementation of the TQM model. Another limitation of total quality management as a tool for restructuring is its internal focus. The difficulty in identifying the "customer" for public sector goods and services and the focus on internal work processes make it hard to truly involve citizens in these TQM efforts. Companies seek to identify external customer needs with surveys and include elected representatives on committees, but they dont include citizens on committees.

Future Direction
In this study, main emphasis is on LM and TQM through Lean thinking approach. A comparison of two management philosophies is the inadequacy of this study. The authors suggest that a comparative study among more than two management philosophies (e.g. LM, TQM, TPM, CWQC, 6Sigma.) considering new approaches can be done in future research. TQM is a customer-driven process that applies the scientific method to the improvement of organizational management systems. Many current TQM practitioners get worried by the dogmatic emphasis that some TQM gurus place on different aspects of the philosophy and on the lack of universally accepted definitions of many of the TQM terms that are commonly employed. Every TQM organization must capture the hearts and minds of everybody in the organization, starting at the top and permeating down in a series of customer/supplier relationships throughout the whole organization and beyond. Here initiatives like Investors in People pioneered by the Department for Education and the TEC movement have a vital and complementary role in helping to establish a total quality environment. So where does all this lead? We have seen that many of the factors defined in BS 7850 date back for millennia. Many of the factors that have been so strongly advocated in recent decades are now becoming well rooted in most successful organizations. A recent issue of The International Journal of the ISO 9000 Forum tells us that over 70,000 certificates of conformance to BS/EN/ISO 9000 have been issued worldwide. The most neglected factor is still, in my view, the people factor, that special blend of the psychological, the philosophical and the practical. So probably the most practical advice for the TQM committed industrialist seeking continuous improvement is to concentrate on the people and pay attention to such initiatives as Investors in people as a practical way forward. Future perspective of lean thinking can be stated in following way: Steady diffusion of the core ideas in every manufacturing industry across the world. Steady application of the core ideas in related activities like logistics and warehousing. Beginning of diffusion of the core ideas in activities beyond the factory after a false start with business process reengineering in the early 1990s The prospect of dramatic progress in the years ahead is real if we can address several challenges. Theoretical Assignment Group No.5

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Conclusion:
Albeit TQM and Lean have the same origin (the quality evolution in Japan), the concepts have developed differently. In the beginning of the 1990s TQM became a very popular notion among researchers and practitioners who wanted to describe how organizations should work to obtain better performance and customer satisfaction. Many researchers also talk about failure of TQM. However, LP is not a singular concept and it cannot be equated solely to waste elimination or continuous improvement, which constitute its guiding principles, nor to JIT, pull production, kanban, TQM, or employee involvement, which make-up some of its underlying components. In the comparative study by Andersson et al. they claim that the Lean approach is project management and Lean is not applicable in all industries! A LP system pushes all decisions as close to the source of the problem as possible. A value stream includes all the operations and processes to transform raw materials into finished goods or services, including non-value adding activities. According to our review of the literature, there is not common point of Lean and TQM clearly. Since LM evolution is LT. The idea of a LP system is reviewed in LT In summary, although Lean and TQM both aim to improve quality, TQM reaches a certain point or stage at which no more improvements can be made. LM, however, focuses on taking quality improvement to the next level.. Though aim of both TQM and LM is same to improve quality but TQM reaches a certain point at which no further imp improvement can be made. And LM emphasized to take quality improvement at next level. The approaches followed by TQM and LM also create difference between them. TQM views quality as internal requirement while LM focuses on reducing wastages. Basically, LM requires skilled, trained professionals and TQM may not. TQM can be a part time thing and done by anyone. According to review there is no common point between Lean and TQM clearly.Since LM evolution is Lean thinking. Based on the new lean thinking approach, Lean is not just a box of tools; it is a system, philosophy and thinking! Therefore, Lean thinking approach can be used to create synergic power for implementation of LM, inducing more competitive market among companies. In this paper more emphasis is given on the comparison between LM and TQM. Comparative study on other management philosophies such as TPM, 6 Sigma can be done for future studies.

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References / Bibliographies
http://ezinearticles.com/?Some-Criticisms-ofTQM&id=1173044http://leaninstituut.nl/publications/aachen_jim_200411.pdf http://www.emeraldinsight.com/journals.htm?articleid=841665&show=html http://www.leaningforward.co.uk/principles.htm http://www.wiley.com/college/sc/reid/chap5.pdf http://rockfordconsulting.com/lean-manufacturing.htm http://mhc-net.com/whitepapers_presentations/LeanPrinciples.pdf http://www.accountingformanagement.com/total_quality_management.htm http://www.emeraldinsight.com/journals.htm?articleid=840208&show=html http://repository.wit.ie/974/1/Impact_Analysis_of_LargeScale_Lean_Manufacturing_Initiatives_upon_Manufacturing_process_innovation _in_Irish_Companies.pdf http://leaninstituut.nl/publications/aachen_jim_200411.pdf http://www.emeraldinsight.com/journals.htm?articleid=841665&show=html

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