A Project Report

ON

QUALITY CIRCLES
Submitted By:
ABHISHEK UMESH USHIR
T.Y.B.M.S SEMESTER V
Submitted To:
UNIVERSITY OF MUMBAI
UNDER THE GUIDANCE OF
DR. SONAL SHARMA

University of Mumbai
SHETH T.J. EDUCATION SOCIETYs,
SHETH N.K.T.T. COLLEGE OF COMMERCE
SHETH N.K.T.T. COLLEGE OF ARTS, THANE (W)
ACADAMIC YEAR 2016-2017
A University of Mumbai

SHETH T.J. EDUCATION SOCIETYs, SHETH N.K.T.T.

COLLEGE OF COMMERCE SHETH N.K.T.T. COLLEGE
OF ARTS, THANE (W)

CERTIFICATE
OF PROJECT WORK

This is to certify that

Mr. ABHISHEK UMESH USHIR of B.M.S Semester-V Seat No: 12 has undertaken
and complete the Project work QUALITY CIRCLES AT BHEL during the academic
year 2013-14 under the guidance of DR.SONAL SHARMA submitted on SHETH
N.K.T.T. COLLEGE OF COMMERCE SHETH N.K.T.T to this college in fulfilment of
the curriculum of BACHELOR OF Management Studies,
UNIVERSITY OF MUMBAI.
This is bonafide project work and the information present is true and original to best of
our knowledge & belief..

-------------------------------

-------------------------------

Sign of Subject In charge

Sign of External

Examiner
-------------------------Sign of Cordinator

----------------------------Sign of Principal

CERTIFICATE
This is to certify that Mr.ABHISHEK UMESH
USHIR, Roll no: 12 of Third Year B.M.S., Semester V
(2016- 2017) has successfully completed the project on
Quality circle under the guidance of Dr. Sonal Sharma.

Course
Principal

Project Guide/ Internal Examiner

External Examiner

Coordinator

ACKNOWLEDGEMENT
To list who all have helped me is difficult because they are so
numerous and the depth is so enormous.
I would like to acknowledge the following as being idealistic
channels and fresh dimensions in the completion of this project.
I take this opportunity to thank the University of Mumbai for
giving me chance to do this project.
I would like to thank my Principal, __________for providing the
necessary facilities required for completion of this project.
I take this opportunity to thank our Coordinator______________,
for her moral support and guidance.
I would also like to express my sincere gratitude towards my
project guide _____________ whose guidance and care made the
project successful.
I would like to thank my College Library, for having provided
various reference books and magazines related to my project.

Lastly, I would like to thank each and every person who directly
or indirectly helped me in the completion of the project especially
my Parents and Peers who supported me throughout my project

ABHISHEK UMESH USHIR.

DECLARATION

I, ABHISHEK UMESH USHIR

the student of

T.Y.B.M.S. Semester V (2016- 2017) hereby

declare that I have completed the project on
QUALITY CIRCLES AT BHEL

The

information

submitted

is

true

and

original to the best of my knowledge.

_____________________
(Signature

of

Student)
ABHISHEK
UMESH

USHIR

Roll No 12
_________________ SHETH N.K.T.T. COLLEGE OF
COMMERCE
SHETH N.K.T.T. COLLEGE OF ARTS, THANE (W)

INDEX
SR .No
1.

Chapter Name
INTRODUCTION

Page. No

1.1

INTRODUCTION / HISTORY

9 -12

1.2

NEED FOR QUALITY CIRCLE

13-23

1.3

SCOPE OF QUALITY CIRCLE

24-24

1.4

OBJECTIVES OF QUALITY CIRCLE

25-25

1.5

RESEARCH METHODOLOGY

25-26

REVIEW OF LITERATURE

2.
2.1

LITERATURE REVIEW

27-34

COMPANY PROFILE

3.
3.1

MANUFACTURING

35-40

4.

4.1

DATA ANALYSIS AND INTERPRETATION

41-52

5.

5.1

FINDINGS, CONCLUSIONS, SUGGESTIONS

53-54

6.

6.1

BIBILIOGRAPHY ,WIBILIOGRAPHY

55-56

CHAPTER- 1
1.1

INTRODUCTION / HISTORY

1.2

NEED FOR QUALITY CIRCLE

1.3

SCOPE OF QUALITY CIRCLE

1.4

OBJECTIVES OF QUALITY CIRCLE

1.5

RESEARCH METHODOLOGY

1.0 INTRODUCTION

Quality Circle is a small group of employees in the same work-area

or doing a similar types of works who voluntarily meet regularly for
about an hour every week to identify, analyze and resolve works
related problems, leading to improvement in their total performance
and enrichment of their work-life.
The above definition reveals, the following features of Quality Circles

1. Small group of employees : Experience has shown that the optimum

number of members in quality circles is about 8 to 10. The
philosophy behind small groups is it should allow every member to
actively participate and that fairly grade number minimize of
employees should be present for the meetings.

2. In the same work-area or doing similar type of works : Quality circle

is a homogeneous group and not the inter-departmental group.
Designation of members need not necessarily be equal but the work
in which they all are engaged should be common.

3. Voluntarily: (Quality circle is not adopted practice but voluntary in

nature. Employees join Quality Circles on their own.

4. Meet regularly for about in hour every week : Normally, Quality

Circles should meet for about an hour every weeks which would help
the members to identify and resolve problems as and when they
occur.

5. To identify, analyze and resolve work-related problems : The

accepted theory is Unit the worker/employees who do the works day
after day better know the problems limiting the excellence. The
problems

are

identified

by

the

members

themselves

by

brainstorming and also on the request from management and other

departments.

6. The problems are then arranged priority wise to tackle them in a

systematic manner.The concept of Quality Circle is primarily based
upon recognition of the value of the worker as a human being, as

someone who willingly activises on his job, his wisdom, intelligence,

experience, attitude and feelings. It is based upon the human
resource management considered as one of the key factors in the
improvement of product quality & productivity

QUALITY CIRCLES
DEFINITION:
Quality Circle is a small group of 6 to 8 employees doing similar work who
voluntarily meet together on a regular basis to identify improvements in their
respective work areas using proven techniques for analyzing and solving work related
problems coming in the way of achieving and sustaining excellence leading to mutual
up liftment of employees as well as the organization.
It is "a way of capturing the creative and innovative power that lies within the work
force".

HISTORY OF THE QUALITY CIRCLES:

The history of Quality Circles cannot be discussed with- out discussing the country of
its Origin .The success of any concept or philosophy gains conviction and spreads
only when it was practiced sincerely .The Japanese have not merely evolved a concept
but practiced it with sincerity of purpose bringing forth amazing results .This has
drawn the attention of the nation the world over and they have found great potential in
involving the people by 1947: General Douglas McArthur requested US Govt. to
send experts to help Japanese rejuvenate their industries.Dr.Edward Deming was sent.

Quality Control Circles (Japan)

1962: First QC Circles was registered with Circle Head Quarters

1962: First annual QC Conference for Foremen was held
1964: Regional chapters of QC were organized in four different districts
1966: Dr.Juran observed QC Circles activities
1966: Special QC Circle session was organized at the 10th conference of European
Organization for Quality Control held in Stockholm, Sedan
1967: Number of registered QC Circles grew to 10000
1968: JUSE dispatched the first QC Circle Study Team overseas
1969: Registered Circles grew t 20000
1969: 100th QC Circle Conference was held in Tokyo
1970: Registered Circles grew to 30000
1971: JUSE organized the first QC Circle seminar
1971: 200thQC conference was held
1971: Registered QC Circles grew t 40000
1971: First National QC Circle Conference was held in Tokyo
1972: Regional Circles grew to 50,000
1973: 300th QC Circle Conference was held
1974: Registered circles grew to 60,000
1974: 400th QC Circle conference as held
1975: Registered Circes grew to 70,000.500th Conference held

1977: Registered Circles grew to 80,000.700th Conference was held

1978: Registered Circles grew t 90,000
1978: First international QC Circles Convention was held
1979: 800th QC Circles Conference was held
1979: Registered QC Circles Conference numbered 1000000
1980: 900th Conference was held
1981: International QC Circles Convention was held
1985: Third International QC Circles Convention was held
1988: More than one million Circles with over ten million members

QUALITY CIRCLES (OTHER THAN JAPAN)

1974: Lockheed Company, USA Started Quality Circles movement

1977: International Association of Quality Circles (IACC) was formed in USA
1980:230 Companies in USA has Quality Circles
1983: There were more than 500,000 known Quality active in the world

QUALITY CIRCLES (INDIA)

1980: BHEL, Hyderabad first in India to start Quality Circles

1982: Quality Circle Forum of India (QCFI) was founded

1983: Tata Motors (formerly Telco) started Circles by 1985 they had more than
Circles

1.2

NEED FOR THE STUDY

QUALITY CIRCLES IN INDIA
In India, Quality Circles movement was introduced in BHEL in January1981, after
preparing the ground in 1980.Its success in a large public enterprise like BHEL
having 73000 employees naturally drew the attention of many organizations in the
country and it triggered off the spread of the movement in the country .BHEL kept its
door open in sharing its experiences and organizing National Seminars in association
with other National Bodies and thus the Q.C movement started catching up.

FORMAL AND INFORMAL GROUPS

Formal Groups

Family.

Organization.

Departments.

Informal Groups

Employees meet near water cooler and gossip.

Five salesmen from marketing department meet once a month for lunch to discuss
mutual concerns and to seek relief from tedious aspects of their job.

Four computer programmers form a jogging club that meets three days per week
at lunch time to run two miles.

All employees of a section meet and discuss how to improve and beautify office

layouts.

Seven workers of a production shop floor meet once a week to solve their
technical problems.

WHAT IS QUALITY CIRCLE (QC)?

Quality Circles are (informal) groups of employees who voluntarily meet together on
a regular basis to identify, define, analyze and solve work related problems.
Usually the members of a particular team (quality circle) should be from the same
work area or who do similar work so that the problems they select will be familiar to
all of them. In addition, interdepartmental or cross functional quality circles may also
be formed.
An ideal size of quality circle is seven to eight members. But the number of members
in a quality circle can vary.

OTHER NAMES OF QUALITY CIRCLES

Small Groups

Action Circles

Excellence Circles

Human Resources Circles

Productivity Circles

STRUCTURE OF QUALITY CIRCLES

Quality Circle Meetings

Meetings are important part of quality circle's working.

Meetings are attended by all the members of the quality circle.

In general, meetings take place once a week or once in a fortnight.

Each meeting lasts for approximately one hour, though variations are possible.

Apart from the frequency of the meetings, what is important is the regularity of the
meetings.

What takes place during quality circle meetings?

Any of the several activities may occur during a meeting such as:

Identifying a theme or a problem to work on.

Getting training as required to enable members to analyze problems.

Analyzing problem(s).

Preparing recommendations for implementing solution(s).

Follow up of implementation of suggestions.

PROBLEM SOLVING TECHNIQUES:

Quality commonly uses certain basics techniques to identify analyze and resolve problems
they are:

Brain storming

Data collection

Stratification

Pareto analysis

Cause and Effective diagram

1. BRAIN STROMING:
Stimulating generation of ideas in a group is done through brain storming, which more
effective then is trying to generate ideas alone brain storming helps to realize the creative
power of the group. It is also helps effective group participation. Its effectiveness would
increase with the skill of application by the leader.
Brain storming generally usually three stages by quality circles.

1. While listing out the problem,

2. While listing out the probable causes influencing the effect,
3. While listing out the suggestions /recommendations,
Guidelines for brainstorming:
Each member, by rotating, is asked for ideas (this continues unit all ideas are
exhausted), only one idea is offered by individual per turn,
Member having no idea, just says Pass
No idea should be treated as stupid (criticizing or ridiculing any idea would in habit
free flow of ideas
Rigid formality may be avoided good natured humor would enthuse members to open
up freely,
Leader should help in summarizing an idea and guide members in clarity of
expression,
No evaluation of ideas is done during brain storming,
A black-board or a large sheet of paper could be used for listing out ideas.
Brain storming technique can be fruitfully used to identify problems effecting the
work area; factors which help prevent potential problem causes responsible for
problems, solutions to problems to etc.

2. DATA COLLECTION:
Data is nothing but collection of act in terms of figures, which gives a clear picture of
any work situation allows for comparison. data collection forms the first step in
statistical analysis of a problem. it would also form a sound basis for decision making
and corrective action. The analysis and solution would depends on the correctness and
accuracy of data must be related to the problem under review

Types of data

Generally data can be of two types one variable i.e. which is measurable, eg.length,
weight, time, etc, and the other attribute .i.e. which is countable data, is a example:
smooth running of a machine small etc,(attribute).

Source of data:
There are two sources f data, past data(previous record, previous feedback) and live
data (current observations).

Past data:
In many cases the required data will be ready available with some agency or the
recorded through a feedback system. The data so available is termed as Past data.
The past data helps to have a preliminary study and to understand the causes of the
problem.

Live Data:
Where such a recorded data is not available we have to systematically collect data
through observation over a period of time and this is termed as Live data.

Collection of data:

Before the start of the data collection, one should be clear in his mind about the parameters or
characteristics and their periodicity for which data is to collected. For easier collection of
data, a Pre-designed checklist/format/ check sheet or any designed format as per the
requirement could be used. This would simplify the process of analysis.

Data collection format:

of

the Type

of No of components made

SI.

Name

No

machine

operation

Vertical Boring

Bring

Horizontal Lathe

Turning

Coil Winding

Final Taping

Grinding

Cutting

Accepted

Rejected

Any special
Reminder

Final
Grinding
Length
Cutting

Analysis of data
After the data is collected, it is analyzed and information is extracted by applying
statistical method. Decision making or further course of action should be based on
analyzed data.

3. STRATIFICATION:
The technique of data segregation based on segregated element is called stratification
data collected should be properly classified for giving meaningful and correct
inference.The stratification of data is nothing but segregation of are groping the data.
machine wise, operator wise, shift wise etc,. for identifying the influencing the factors

Material Base:
data is stratified n the basis of the supplier of the materials, delivery lot of the materials,
preliminary process etc, by this the effects of the materials have on the quality of the final
product.

Quality Base:

Data is stratified by kinds f products specification etc. if phenomenon inherent to a

special group of product can thus be traced.

Work Base:
Stratification on the basis of worker is often very effective.

Time base:
Data is stratified by the seasons, day-and-night, atmospheric conditions such as
temperature, humidity and physiological conditions of the workers differ from time to
time. the influence of these elements on quality is sometimes founded by time based
stratification .

Surrounding conditions:
The quality of product may be influenced by such surrounding conditions as weather,
productions schedules, tightness r slowness of the market etc.

Processing:
Element such as production equipment, measuring instrument, manufacturing methods
etc. There are more stratification bases other than the listed above.

4. PARETO ANALYSIS:
Pareto was an Italian economist who discovered a universal relationship between
value and quantity and he used this technique for assessing uneven distribution of
wealth. Pareto analysis helps in the identification of the vital few trivial many at a
glance hen projected, using the column graph named after Pareto diagrams are
frequently used to select the few important problems out of many.

What is Pareto Diagram:

Pareto diagram is a column graph, drawn after data collection for the purpose of:a. Differentiating the major factors (vital) that contributes most to the
unsatisfactory situation from other minor ones (trivial).
b. Trackling the major factors responsible for any problem.

How to prepare Pareto diagram:

Stratify the problem points according to purpose (by causes, by phenomena, by
equipment) and represent them numerically,
Preferably data should be expressed in monetary values rather than quantity, counts or
percentage,
Select a data period proper for the purpose,
Arrange the stratified items in descending order of value and bar chart ,in descending
order of value and draw a bar chart,(on a graph paper)

PARETO CHART

Simple example of a Pareto chart using hypothetical data showing the relative
frequency of reasons for arriving late at work.
A Pareto chart is a special type of bar chart where the values being plotted are
arranged in descending order. The graph is accompanied by a line graph which shows
the cumulative totals of each category, left to right. The chart is named after Vilfredo
Pareto, and its use in quality assurance was popularized by Joseph M. Juran and
Kaoru Ishikawa.
Typically on the left vertical axis is frequency of occurrence, but it can
alternatively represent cost or other important unit of measure. The right vertical axis
is the cumulative percentage of the total number of occurrences, total cost, or total of
the particular unit of measure. The purpose is to highlight the most important among a
(typically large) set of factors. In quality control, the Pareto chart often represents the
most common sources of defects, the highest occurring type of defect, or the most
frequent reasons for customer complaints, etc.
The Pareto chart was developed to illustrate the 80-20 Rule that 80 percent of the
problems stem from 20 percent of the various causes.

5). CAUSE& EFFECTIVE DIAGRAM

Ishikawa diagram
Ishikawa diagram, in fishbone shape, showing factors of men, machines, milieu
(workplace), materials, methods, measurement, all affecting the overall problem.
Smaller arrows connect the sub-causes to major causes.
The Ishikawa diagram (or fishbone diagram or also cause-and-effect diagram) are
diagrams, that shows the causes of a certain event. A common use of the Ishikawa
diagram is in product design, to identify potential factors causing an overall effect.

Overview
Ishikawa diagrams were proposed by Kaoru Ishikawa in the 1960s, who pioneered
quality management processes in the Kawasaki shipyards, and in the process became
one of the founding fathers of modern management.
It was first used in the 1960s, and is considered one of the seven basic tools of quality
management, along with the histogram, Pareto chart, check sheet, control chart,
flowchart, and scatter diagram. See Quality Management Glossary. It is known as a
fishbone diagram because of its shape, similar to the side view of a fish skeleton.
Mazda Motors famously used an Ishikawa diagram in the development of the Miata
sports car, where the required result was "Jinba Ittai" or "Horse and Rider as One".
The main causes included such aspects as "touch" and "braking" with the lesser
causes including highly granular factors such as "50/50 weight distribution" and "able
to rest elbow on top of driver's door". Every factor identified in the diagram was
included in the final design.

Causes
Causes in the diagram are often based on a certain set of causes, such as the 6 M's, 8
P's or 4 S's, described below. Cause-and-effect diagrams can reveal key relationships

among various variables, and the possible causes provide additional insight into
process behavior.
Causes in a typical diagram are normally grouped into categories, the main ones of
which are:

The 6 m's
Machine, Method, Materials, Maintenance, Man and Mother Nature (Environment)
(recommended for the manufacturing industry).
Note: a more modern selection of categories used in manufacturing includes
Equipment, Process, People, Materials, Environment, and Management.

The 8 p's
Price, Promotion, People, Processes, Place/Plant, Policies, Procedures, and Product
(or Service) (recommended for the administration and service industries).

THE 4 S'S
Surroundings, Suppliers, Systems, Skills (recommended for the service industry).
Causes should be derived from brainstorming sessions. Then causes should be sorted
through affinity-grouping to collect similar ideas together. These groups should then
be labeled as categories of the fishbone. They will typically be one of the traditional
categories mentioned above but may be something unique to your application of this
tool. Causes should be specific, measurable, and controllable. Appearance

A generic Ishikawa diagram showing general (red) and more refined (blue) causes for
an event.
Most Ishikawa diagrams have a box at the right hand side, where the effect to be
examined is written. The main body of the diagram is a horizontal lines from which
stem the general causes, represented as "bones". These are drawn towards the lefthand side of the paper and are each labeled with the causes to be investigated often
brainstormed beforehand and based on the major causes listed above.
Off each of the large bones there may be smaller bones highlighting more specific
aspects of a certain cause, and sometimes there may be a third level of bones or more.
These can be found using the '5 Whys' technique. When the most probable causes
have been identified, they are written in the box along with the original effect. The
more populated bones generally outline more influential factors, with the opposite
applying to bones with fewer "branches". Further analysis of the diagram can be
achieved with a Pareto chart

1.3

SCOPE OF THE STUDY

SCOPE OF THE STUDY

Facilitating all the eligible employees of BHEL, Hyderabad to participate in
the Quality Circle movement. Though, the participation by workers in Quality Circles
is voluntary, the role of QA is to encourage the formation of Quality Circles and to
nurture them to take up improvement activities /solving the problem in their
respective functions. Providing platform for presenting the Improvement made.

BHEL Hyderabad initiated the first five quality circles in the country on 5 th
January 1981. 3 circles were started in manufacturing area and two circles in materials
management function of pump shop. this five circles presented their case studies within
three months i.e. on 20th march1981in the presence of sri.M.R.Naidu,the then executive
director one of the circles made a presentation on work place improvement
BHEL, Hyderabad facilitated starting of Quality circles in other sister units in 1981
BHEL, Hyderabad played a key roll in organizing first inter unit Quality circle
convention at R&D, in august 1981.

First annual unit Quality circle convention was held in august 1985.
BHEL, Hyderabad as adjudged as the Best organization for promoting Quality circles
for seven consecutive years from Andhra Pradesh productivity council (1997-2003).
Best organization for promoting quality circles from QCFI from 2003 onwards
BHEL, Hyderabad initiated student quality circles first time in schools of township.
BHEL, Hyderabad circles participated in international Quality circles conventions held
at Bangkok (2004), Bali (2006-Silvel medal) Beijing (2007-Gold medal) and Singapore
(2008)

1.4 OBJECTIVES OF THE STUDY

1.

Create problem solving capability, Improve communication, Promote leadership

qualities & personal development.

2.

Improve morale through closer identity of employee objectives with organization's

objectives, Enhance quality, and awareness for cleanliness &Reduce errors.

3.

Build an attitude of problem prevention, Job involvement, harmonious

relationship between supervisor and worker.

4.

Improve productivity, Reduce downtime of machines and equipment &Increase

employee motivation

1.5

RESEARCH METHOLOGY
As the organization identified human resource as their asset, taking care of them is
very important to make them motivate for the achievement of the goal. How welfare
activities to be structured so that it should be up to the satisfactory level of the
employees is very critical.
Quality Circles are to know the Quality circle activities and hoe it is practiced, and to
know whether the employees are aware of it and availing the benefits.
The main objective of Quality Circles is self and mutual development, cohesive
team work and engaged in continuous improvement activities, thus improving their
quality of work life.

METHODOLOGY:

The methodology used in this project has been that of unstructured interview of the
guide, which has facilitated the extractions of information. Although there has been a
structured questionnaire to capture the information.

DATA COLLECTION
Primary data
Collected through responses of employees related to the topic with the help of the
structure questionnaire.

Secondary data
Collected through Broachers news magazines, Hand Books, corporate journals and
apex manuals, web sites.

SELECTION OF THE MEASUREMENT TECHNIQUE

1. Fully aware
5 Frequently
9 Fully agree
12. Fully satisfied

2.Aware
6.Sometimes
10.To some extent
13strongly disagree

3.only basics
4.Not aware
7.rarely
8.Never
11.satisfied
14.Important 15. Very important

SAMPLING
Population

employees of BHEL, Hyderabad

Sample size

100 employees from all categories.

ANALYTICAL APPROACH
The assumption has been carried out with the help of chi square method, presuming
hypothesis for each question. Pie chart representation shows the percentage responses
received from the questionnaire.

ASSUMPTIONS
The study assumes that the information revealed by the respondents is authentic and
not misleading.

CHAPTER-II
REVIEW OF LITERATURE

2.1 LITERATURE REVIEW

Quality Circles (QC), participative decision making (with selected consideration of
the broader area of decision making in organization), Job Involvement,
communication climate and job satisfaction,
Literature concerning participating decision making, decision making, job
involvement, communication climate and job satisfaction is reviewed because this
study seeks to determine whether QC membership results many changes with respect
to these work attitudes (as measured by the AFIT survey of the work attitude). Each of
the above listed topics is reviewed separately.
Quality circles research:
Few studies have attempted to evaluate the attitudinal or behavioral outcomes
associated with participation in a QC program. Also, there is a severe shortage of
research involving quantitative assessments of factors which are considered necessary

for success. It is with a discussion of the suggested basic elements necessary for a
successful QC program that this review of the literature will begin.
The most notable listing of significant factors related to QC success arises from the
results of a survey administered to 50 QC experts attending the third annual
conference of the International Association of Quality Circles (Stevens&Moore,
1981).Ranked according to frequency of mention, these factors are:
1. Management acceptance/support/understanding
2. Training for the circle leader(s) and facilitator(s)
3. Voluntary participation
4. A. people-building managerial philosophy
5. Allowance of sufficient time for assessment of results and return on investment
6. Open channels of communication with upper management
7. A team effort approach to problem solving
8. Team member and management participation
9. Recognition
10. Confining circle activities to work-related problems
Stevens and Moore believe that the presence of each of the above 10 factors is crucial
for the survival of a QC program.
Metz (1980) and Cole ((1980) have warned that failure to include and /or
educate middle management personnel when QC programs are initiated can lead to
oppositional when QC programs are initiated can lead to oppositional and
obstructional attitudes and behaviors on the part of supervisors. these attitudes and
behaviors stem from the belief the circle activities are an infringement on their ( the
supervisors) own job responsibilities and/or QC suggestions are a reflection of their
own inadequate job performance (and hence represent a threat to their job security)
Burck (1981) points to the importance of a trusting relationship between management
and employees as a necessary ingredient for QC success. Cole (1980b) further
emphasizes the importance of financial incentives and recognition as additional
motivators for QC members.

These impressions of QC experts concerning the necessary ingredients for QC

success all assume that QC programs indeed result in improvements related to the
increased organizational effectiveness. However, given the lack of research on the
subject even this most basic of assumptions cannot be made. Despite the assertion by
Rieker and Sullivan (1981) that assessing QC effectiveness may cannot be possible
or cost effective in the near term because of the difficulty in isolating the effects of
one relatively small component of an integrated organizational structure, research
must be conducted in to the area if the QC concept is to be anything more than merely
a passing fad (Ouchi, 1981)
Only four studies QC outcomes presently appear in the literature. The first, an
uncontrolled field experiment conducted by general dynamic Pomona Division
(Hunt, 1981) reports the results of a six month pilot program, the purpose of which
was to provide information for management as an aid for the evaluation of the long
range potential of QCs within the firm. Several morale, motivation and performance
criteria were monitored with before and after comparisons made for Quality
Circle members and other employees.
No mention was made of controls for possible differences between members of the
QC group and the other employees comparison group; nor were there indications of
controls made for changing group composition. Though the author noted that Quality
circle members demonstrated superior performance on measures of product Quality,
error reduction job involvement and problem-solving capabilities when contrasted
with other employees, these conclusions must be viewed with caution due to the
limitations of the experimental design.
Results of this study therefore should not be generalized to other organizations. The
value of the experiment is that it demonstrates an interest by management in
empirically evaluating QC success before organization-wide adoption of the QC
concept.
In noting the need for QC program evolution, Donovan and Van Horn (1980) have
provided the following suggestions:

1. Measuring of multiple levels which includes objective measures of productivity

and quality (such as hours/unit and defects/.unit) and assessment which provide an
overview of program coats.
2. Effective research tools including surveys and questionnaires which provide
information concerning job and climate variables related to high productivity and
satisfaction.
3. Adequate research. Designs providing pre-and post circle implementation
comparisons and, where possible, control group of baseline information.
The authors conducted five independent studies of QC effectiveness at Honeywell,
Inc. upon which they concluded that the intervention was responsible for dramatic
performance and efficiency improvements.
However, due to significant flaws in study design, it is impossible to assess the true
impact of the circles. No controls for the changing memberships of the QC and
control groups were incorporated into the study.
Further, the authors made no specific mention of the composition of the various circle
and control groups if circles membership was voluntary; it was likely that the circle
member exhibited differences of personality and motivation which distinguished them
from those who chose not to participate. If the composition of the QC group was not a
representative sample of employees performing similar work at Honeywell, Inc., then
no generalization of the study result can be made which will apply to others
organizational employee groups.
On the other hand, if existing work groups were designated as QC groups and
controls , group equivalence is not assured through randomization through pretests
were administrated to both QC and control groups; no mantion was made as to
whether pretest observations were used to develop correction factors to be used to
compensate for pre-existing group differences.
Tortorich at all (1981) developed a method of QC evaluation at Martin Marietta
Corporation Michoud Assembly division which avoid some of the pitfalls discussed

above .the following three categories of effectiveness measures were developed for
internal use by managers, program administrators, facilitators and the circles
themselves.
1. Program measures are obtained which are direct measures of QC growth and
efficiency and include assessments of the number of supervisors and management
personnel completing circle leadership training, the number of employees completing
circle training, the number of circles formed, the average circle membership size,
success rate, the ratio of trained employees volunteering for circle activity, the number
and rate of presentations made by circles to management, the percentage of approved
proposals , and the direct cost savings. Resulting from circles activities.
2. Personnel outcomes are asses; these are defined as the effect of QCs on employees
attitudes concerning their job situation as measured by various attitude questionnaires.

3. Organizational outcomes are also evaluated Organizational outcomes are the effects of
QCs on such cost related criteria as performance rates, defect rates, scrap rates,
attrition rates, lost time, grievance rates and accident rates.
Depending on need, assessment information is calculated monthly or at six-month
intervals. The former approach is use to identified and quickly respond to problems or
to provide managers with summery information about circle related variables. Six
month data interval is use to contrast the personal and organizational outcomes of QC
Groups members with those of non-circle employees.
The effectiveness of the QC programs is also analyzed in terms of individual changes
on measure of personal and organizational outcomes which are attributed to the
effects of circle membership or non membership. To performed this analysis,
performance data for each circle member is analyzed in six-month intervals using the
data of entry into the circle as the point of reference.
Hence, data collected six-months prior to entry in to a QC group is compared with
data collected six months following initial circle membership. A similar analysis is

conducted on performance. Information collected on employees not joining circles

within the same time frame under study for circle members.
Therefore, for both circle and non circles employees, data are collected for staggered,
but identical, time intervals thud controlling for the fact that circle members join and
resign QC group at difference times during the life of the program.
Circles effectiveness can then be analyzed by calculating the difference with in
circles members six-months before and six-months after entry in to the QC program
while concurrently performing a similar analysis of non circle members over the
identical six months intervals. Group and individual comparisons can then be made

Summary data is presented in Tortorich et al paper through rigorous statistical

analysis is not included, between 90 to 100% of the suggestions offered to
management by the QC groups in the areas of Quality improvement, cost reduction,
tooling and training were approved over the January, 1980 to june,1981 time period.
Employee attitudes, as measured by a survey, were assessed When the work attitudes
of those who had participated in QC activity for at least six-months were concurrently
compared with the work attitudes of untrained QC members,the formed were found
by Tortorich et al. to demonstrate a number of more positive work attitudes.
For the year 1980, significant differences (P=.05) were found between the
comparisons groups for the following job related attitudes: employee supervisor
relations, satisfaction which supervisor, employee influence, internal motivation, job
satisfaction, team climate, growth satisfaction and job performance. In short, the
results suggested that QC groups can provide potentially help full inputs to the
managerial decision making process as well as promote improved employee work
attitudes.
Employees of 14 departments were trained in QC techniques and then offered the
opportunity to participate in one of several QC groups. Members of an additional 37
Departments from the same division were provided no direct exposure to the Qc

program and served as the control group for this study.

There were no controls for changing group membership this is a serious
methodological limitation but one which difficult to incorporate in field study
research. Considerable fluctuations in the demographic measures during the six-tonine months interval between administrations of the preset measures suggest changes
in the composition of treatment groups during the course.
of this experiment the absence of controls for changing group membership such as
those employed by Tortorich et al.(1981) are likely to limit the interpretability of
findings for any study where QC and control groups are characterized by high
mortality of subjects.
Utilization of intact work group as experimental (QC) and control subjects
necessitated the use of the non equivalent control group design (Campbell & Stanley,
1963). This quasi-experimental design is characterized by taking preset of both
experimental and control groups before the intervention is initiated
A statistical correction adjusting for pretest differences was then made group
differences on the posttest were evaluated in order to compensate for pre-existing
group differences. The data were analyzed employing stepwise hierarchical regression
analysis with the result that no significant increases in R2 were observed for the 23
OAP attitudinal measures.
This suggests that QC participation did not significance impact employee work
attitude through the authors state that the following methodological limitations
severely impacted study results:
1. Because QC groups were formed at staggered intervals, some did not have enough
time to reach maturity prior to post test data collection. Three of the six QC
groups functioned for less than one month when post test data was collected.
2. Experimental mortality (discussed above)

3. Several significant demographic differences existed between the treatment and

control groups at the studys outset.
4. Behavioral and group effectiveness outcomes of QC participation were not
measured.

5. The sample size was small: the treatment condition contained only 14 functional
work units, enhancing the likelihood of Type II errors.
The interpretability and generalized of findings are restricted by these limitations, yet
this study is important from a historical perspective. It is the first research reported by
these limitations.
yet this study is important from a historical perspective. It is the first research
reported in the QC literature that assesses attitudinal outcomes of QC activity while
employing an experimental design that incorporates control group comparisons and
statistical control for non Equivalent of matched groups.
Whereas research regarding the outcomes associated with the QC approach to
employee participation in decision making is quite in both its scope and methodology,
much work has been coming the more general area of participative decision making.
It is to the body of Literature addressing this topic that we now turn.

CHAPTER-III
COMPANY PROFILE

COMPANY PROFILE
BHEL (Bharat Heavy Electricals Limited) is the largest engineering and
manufacturing enterprise in India in the energy-related/infrastructure sector.

3.1 Manufacturing

Establishments in the Manufacturing sector are often described as plants, factories,

or mills and characteristically use power-driven machines and materials-handling

equipment.
Manufacturing establishments may process materials or may contract with other
establishments to process their materials for them. Both types of establishments are

included in manufacturing.
BHEL was founded in 1950s.Its operations are organized around three business

sectors:
Power.
Industry-including Transmission, Transportation, and Telecommunication &

Renewable Energy.
Overseas Business.

3.2 Industry

BHEL has also emerged as a major supplier of controls and instrumentation systems
especially distributed digital control systems for industries, and simulators for
various applications.

BHEL is supplying X'mas tree valves and well heads up to a rating of 10,000 psi to
ONGC and Oil India. It can also supply on-shore drilling rigs, sub-sea well heads,
super deep drilling rigs, desert rigs and heli-rigs.

3.3 Transmission

BHEL supplies a wide range of transmission products and systems of up to 400 kV

class. Those include: high-voltage power and distribution transformers, instrument
transformers, dry-type transformers, SF6 switchgear, capacitors and ceramic
insulators.

Equipment for high-voltage direct current (HVDC) systems are also supplied, for
economic transmission of bulk power over long distances. Series and shunt
compensation systems are also manufactured to minimize transmission losses.

BHEL has developed and commercialized the countrys first indigenous 36 kV Gas
Insulated Substation and has also developed 145 kV Gas Insulated Substation (GIS)
which has undergone successful testing at CESI, Italy.

BHEL has also established its capability in the area of Flexible AC Transmission
systems (FACTS).

3.4 Transportation

Most of the trains of the Indian Railways are equipped with BHELs traction and

traction control equipment.

India's first underground metro at Calcutta runs on drives and controls supplied by

BHEL.
The Company has developed and supplied broad gauge 3900 HP AC locomotives,
5000/4600 HP AC/DC locomotives, diesel shunting locomotives of up to 2600 HP,
battery powered road vehicles, including electrics & control electronics.

BHEL has acquired the technology for 6000 HP 3-phase AC Locos and started
manufacturing the electrics & controls as well as those for 3-phase AC EMUs,
Diesel EMUs and OHE cars.

3.5 Telecommunication

BHEL manufactures telecom switching equipment based on C-DOT technology, the

major products being MAX-XL of up to 40,000 lines capacity and Single Base
Module RAX for rural applications.

3.6

Renewable Energy
Technologies have been developed and commercialized for exploiting nonconventional and renewable sources of energy.

These include photovoltaic cells and modules, solar lanterns, grid-interactive PV

Power Plants and solar heating systems.

BHEL has emerged as a major manufacturer of wind electric generators of up to

250 kW unit size. The Company has set up its own wind farms of 3000 kW capacity
(12x250 kW) at Ramgiri (A.P.) and another of 4000 kW capacity (16x250 kW) at
Kadavakkallu (A.P.).

Today, BHEL has a wide-spread network comprising 14 manufacturing divisions, 8

service centers, 4 power sector regional centers, 18 regional offices, and a large
number of project sites spread all over India and abroad.

This enables BHEL to have a strong customer orientation, to be sensitive to his

needs and respond quickly to the changes in the market.

It manufactures over 180 products under 30 major product groups and caters to
sectors including power generation and transmission, transportation, and renewable
energy, among others.

3.7 Profits and losses of BHEL

The company recorded revenues of INR331, 544.8 million ($6,962.4 million)

during the financial year ended March 2010 (FY2010), an increase of 25.2% over
FY2009.

The operating profit of the company was INR55, 957.7 million ($1,175.1 million)

during FY2010, a decrease of 8.3% compared to FY2009

.
The net profit was INR43, 269.2 million ($908.7 million) in FY2010, an increase of
38.9% over FY2009.

Bharat Heavy Electricals Limited (BHEL) - SWOT Analysis examines the

company's key business structure and operations, history and products, and provides
summary analysis of its key revenue lines and strategy.

3.8 Strengths

The company has 180 products under 30 major product groups that cater to the
needs of the core sector like power, industry, transmission, transportation, defense,
telecommunications and oil business.

BHEL's ability to acquire modern technology and make it suitable to Indian

conditions has been an exceptional strength of the company.

Strong relationship with NTPC is strength as NTPC is planning a capacity
expansion of Rs. 52 bn and based on the past, 85% of NTPC projects have been
bagged by BHEL. The company also enjoys purchase price preference.

Huge investment in R&D

.
Merger & Acquisition The Company has taken over the Management & Control
of Bharat Pumps & Compressors Ltd and completely taken over M/s- Bharat Heavy
Plate & Vessels Ltd.

3.9 Opportunities

The power sector reforms are expected to pick up in the near future in India, which
would directly benefit BHEL.

Increase in defense budget will increase the top line for the company.

NTPC is planning additional capacities to the tune of 2,800 MW, at a cost of Rs 52

bn.

BHEL could benefit a lot as it has happened in the past that significant portion of
the project of NTPC is handled by BHEL. Nearly 85% of the NTPC projects were
assigned to BHEL only.

Huge order for setting up of nuclear power plant

3.10 Competitors of BHEL

L&T
SUZLON
BEML
BGR ENERGY
AIA ENGINEERING
ALFA LAVAL
PRAJ INDUSTRIES
SANGHVL MOTORS
WALCHAND NAGAR

VISION
A World-class Engineering Enterprise Committed to enhancing Stakeholder Value.

MISSION

To be an Indian Multinational Engineering Enterprise providing Total

Business Solutions through Quality Products, Systems and Services in the fields of
Energy, Industry, Transportation, Infrastructure and other potential areas
BHEL has been a pioneer in the area of Human Resource Development, being
the first Public Sector Undertaking of its kind, in India, to have setup an extensive
HRD infrastructure as way back as the early sixties. Human Resource Development
Centre (HRDC) of BHEL R.C.Puram, Hyderabad occupies a significant place not
only among other HRDCs of BHEL but also as an important Training and
Development Centre in the twin cities of Hyderabad [Andhra Pradesh].

CHAPTER-IV
4.1

DATA

ANALYSIS

AND

INTERPRETATION

Q.1 Since how many years have you been working with this organization?

No.

Opinion

0-5 Years

28

28

5-10 Years

47

47

10-15 Years

14

14

11

11

100

100

More than 15
Years

Total

respondents

INFERENCE:
1.
2.
3.
4.

of

S. No

0-5 Years (28%)

5-10 Years (47%)
10-15 Years (14%)
More than 15 Years (11%)

Q.2 Are you aware of Quality Circles?

Percentage

No. of

S. No

Opinion

Fully Aware

44

44

Partially aware

31

31

only basics

21

21

Not aware

100

100

Total

respondents

INTERPRETATION:
Most of the employees are aware of the Quality Circles.

Percentage

Q.3 Do you involve in Quality circles teams working in your work area?

No.

of

S. No

Opinion

Frequently

28

28

Some times

47

47

Rarely

14

14

Never

11

11

100

100

Total

respondents

Percentage

INTERPRETATION:
The Majority of the respondents i.e. 47% agree and only 11% disagree with the
statement
Q4. Are you a member of any Quality Circle?

No.

of

S. No

Opinion

Yes

67

67

No

33

33

100

100

Total

respondents

Percentage

INTERPRETATION:
Most of the employees are having membership in Quality Circl

Q.5 What is the main purpose of Quality Circles in your Organization?

S.
No
1
2

No.

Opinion

respondents

Improvement

in

Human Relations
Promotion of Work
Culture

of

Percentage

Develop Team Work

19

19

Improve Productivity

13

13

12

12

53

53

100

100

5
6

Enhance

Problem

Solving Capacity
All of the Above

Total

INTERPRETATION:

The majority of the respondents i.e. 53% agree and only1% of respondent wants to
make some improvement in human relations.
Q.6 Do you think quality circle develops a participative environment in the
Organization?

No.

of

S. No

Opinion

Fully agree

55

55

To Some extent

38

38

Does not

Not aware

100

100

Total

INTERPRETATION:

respondents

Percentage

Regarding feedback 55% of the employees are fully agree where as 3% of the
employees are not aware of quality circles.

Q.7 Do you think that quality circles team can solve the problems of your
work area?

No.

of

S. No

Opinion

Fully agree

39

39

To Some extent

55

55

Never

100

100

Total

respondents

Percentage

INTERPRATATION:
Most of the employees are agree to take active part in quality circles team to solve
the problems in that work are

Q.8 Do you think that Quality Circles are helpful in Cost Reduction?

No.

of

S. No

Opinion

Fully agree

59

59

To Some extent

37

37

Never

100

100

Total

respondents

Percentage

INTERPRETATION:
Out of 100 employees 59% of the employees are agree to belive Quality Circles are
helpful in Cost Reduction.

Q.9 Do you think that Quality Circles are helpful in increasing Productivity?

No.

of

S. No

Opinion

Yes

66

65

To Some extent

32

32

Never

100

100

Total

respondents

Percentage

INTERPRETATION:
Out of the 100 employees 66% percent of the employees are agree to declare Quality
Circles are helpful in increasing Productivity

Q10. Do you think that Quality Circles are helpful in building a Positive
Work Culture?

No.

of

S. No

Opinion

Yes

70

70

To Some extent

28

28

Never

respondents

Percentage

Total

100

100

INTERPRETATION: Regarding feed back 70% of the employees are satisfied

whereas 2% of the employees are not satisfied with this statement.

CHAPTER-V

5.0 FINDINGS, CONCLUSIONS, SUGGESTION,

FINDINGS

Most of the employees are aware of the Quality Circles.

Most of the employees are interested to make use of the Quality Circles
Most of the employees are think quality circles team will solve the problems in that
work area
Out of 100 employees 59% of the employees are fullyagree &37% of the employees
are To some extent to say Quality Circles are helpful in Cost Reduction.
Out of 100 employees 70% percentage of the employees agree, Quality Circles are
helpful in building a Positive Work Culture
Out of 100 employees 56% of the employees are fully agree &41% of the employees
are think To some extent to say the management keep track on the activities of
Quality Circles
Out of 100 employees are 70percentage of the employees Satisfied &25% of the
employees are highly satisfied with the Quality Circle Movement in BHEL,
Hyderabad.
Most of the emplyees think Top Management is interested in motivating the
employees through Quality Circles.
Out of the 100% employees 51% of them think quality circles are useful for the
growth of the company.
Out of the 100 employees 66% of them agree the Top Management Rewards the
Quality Circle Members for their Achievements

CONCLUSION

It would be a great service to the cause of Quality Circles.

Helps develop ability to work in teams and appreciate others point of view
If all those who are interested in the healthy propagation of the philosophy in the
country take every opportunity to stress What Quality Circles are not?, as
enumerated above, because there are quite a few instances
Where Quality Circles failed to take off due to such misconceptions prevailing in
the minds of the Management personnel
Hence it can be safely concluded that no progressive organization can afford to ignore
the concept of quality circles.
Quality Circles are not limited to manufacturing firms only.
Quality Circles are relevant for factories, firms, schools, hospitals, universities,
research institutes, banks, government offices etc.

SUGGESTIONS
Conducting the motivational classes every month last week
It is very important to provide the opportunity to the employees of the organization to
express their ideas or whatever they want to express
Management should give the importance to mental relaxation &social cultural
development of an employees who strives hard for the company

 Reward or Praise/appreciation works as magic for an individual and motivates them

for work.
Role clarity of each position should be defined and based on that individuals can plan
their work accordingly.
Self-potential system should be encouraged
There are regular review and comparison of current & past performance to detect
gradual deterioration in the strategy
Proper cooperation should be necessary in the company

6.1 BIBILIOGRAPHY

BIBLOGRAPHY
Text Books
1. K.Aswathappa (1997), Human Resources and Personnel management Tata
McGraw-Hill publishing Company Ltd, New Delhi-110001
2. John M.Ivancevich (2003), Human Resources and Personnel management Tata
McGraw-Hill publishing Company Ltd, New Delhi-110001
3. C.R.Kothari

(2001)

Research

Methodology

of

wishwa

prakashan

Publishing,Chennai-17,Edition
4. C.B.

Mamoria

and

S.V.Gankar

(2001),

Personnel

&Cases,Himalaya Publishing houses Mumbai, XXI Edition.

Management

Text

5. R.S.N,Pillai and V.Bhavathi(1998), Statistics of Sultan Chand and sons,New

Delhi,pp.132-141,II Edition.
6. Management of change -Palmer,Dunford,Akin

Webliography
Websites:
www.citehr.com
www.managementparadise.cm
www.scribd.com
www.wikipidia.com
www.qualityofworklife.com

Questionnaire

Q1. Since how many years have you been working with this organization?
A) 0-5 Year

B) 5-10 Years C) 10 to 15 Years D) More than 15 Years

Q2. Are you aware of Quality Circles?

A) Fully aware B) Partially aware C) Only Basics

D) Not aware

Q3. Do you involve in Quality Circle teams working in your work area
A) Frequently

B) Sometimes

C) Rarely

D) Never

Q4. Are you a member of any Quality Circle?

A) Yes

B) No

Q5. What is the main purpose of Quality Circles in your Organization?

A) Improvement in Human Relations
C) Develop Team Work

B) Promotion of Work Culture

D) Improve Productivity

Q6. Do you think quality circle develops a participative environment in the

organization?
A) Fully Agree B) To some extent

C) Does not D) Not aware

Q7. Do you think that quality circles team can solve the problems of your work
area?
A) Fully

B) To some extent

C) Never

Q8. Do you think that Quality Circles are helpful in Cost Reduction?
A) Yes

B) To some extent

C)Never

Q9. Do you think that Quality Circles are helpful in increasing Productivity?
A) Yes

B) To some extent

C) Never

Q10. Do you think that Quality Circles are helpful in building a Positive Work
Culture?
A) Yes

B) To some extent

C) Never

Q11. Does the management keep track on the activities of Quality Circles ?
A) Yes

B) to some extent

C) Never

Q12. Are you satisfied with the Quality Circle Movement in your organization?
A) Highly-Satisfied B)Satisfied

C)Dissatisfied

Q13 Which is not true for Quality Circle?

A) A small group

B) Voluntary

C) Uses quality control techniques

D)Have members from any where in the work area

Q14 Which statement is not applicable to Quality Circle?

A)Small group

B)Non Voluntary C)Grass root level

D)For self and mutual development

Q15 Where was Quality Circle born?

A)USA B) Japan C)India D)Korea

Q16 Primary aim of quality circle is

A) To solve companys problem
B) To develop people
C) To improve the image of the organisation
D) To motivate people to work

Q17 Which is not true in Quality Circles concept?

A) Is to improve the image of the organisation
B) Is to solve the problem given by management
C) For mutual development
D) For people to work in teams

Q18 Which one is not correct? Quality Circle is not

A) For individuals problem
B) A substitute for quality control department
C) For self & mutual development
D) Panacea for all ills

Q19 Who introduced Quality Circles in Japan?

A) Shigeo Shingo Geinichi Taguchi Junji Noguchi K Ishikawa

Q20 Which of the following statement is correct?

A) Quality Circle is just a problem solving group
B) Quality Circle is a forum for discussing matters relating to industrial relation
C) Quality Circle is not a forum for grievances or demands
D) QC case study should always result in monetary saving

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