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Contents

1. Introduction .................................................................................................................... 2
2. Understanding the quality dimensions in products and services ..................................... 4
2.1. Contrast of Automobile as goods and services ....................................................... 4
2.2. Dimensions of product quality ................................................................................. 4
2.3. Dimensions of service quality .................................................................................. 4
3. Stages/Process of Manufacturing an Automobile ........................................................... 6
3.1. Development........................................................................................................... 6
3.2. Product preparation ................................................................................................ 6
3.3. Production .............................................................................................................. 6
4. Total Quality Management (TQM) method ..................................................................... 7
4.1. TQM definition and concept .................................................................................... 7
4.2. PDCA methodology/process ................................................................................... 8
4.3. Advantages of TQM methodology ........................................................................... 9
4.4. Disadvantages of TQM methodology ...................................................................... 9
5. Six Sigma methodology ............................................................................................... 11
5.1. Six sigma as a methodology in quality management ............................................. 11
5.2. Promoting customer satisfaction by applying six sigma ......................................... 11
5.3. DMAIC cycle ......................................................................................................... 11
5.4. Advantages of Six Sigma Methodology ................................................................. 13
5.5. Disadvantages of Six Sigma methodology ............................................................ 13
6. Conclusion - Comparisons between TQM and Six Sigma and Recommendation ......... 14
REFERENCE ...................................................................................................................... 15

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Critical Analysis of Total Quality Management and Six Sigma
Implementation in Automobile Company

PROJECT AND QUALITY MANAGEMENT (SEM1 AF-2018/9) (55-703365-AF-20189)

Authors: Tapuwa Mubare, Vu Hoang Anh, Esther Bakare, Yahya Bahadorkhalil

Abstract – Ever since the early 1950s, organizations have been implementing different
methodologies like Total Quality Management (TQM) and Six Sigma in order to eliminate
defects and improve the production of goods and services whilst focusing on customer
satisfaction as well as cost reduction. Renowned companies like Ford, General Electric and
Motorola, just to mention a few, have had considerable successes as a result of applying
these ideologies. General Electric claimed to have generated over $12 billion over 5 years in
savings by employing Six Sigma Methodology. Another success story, Motorola, were able
to reduce their manufacturing costs by $1.4 billion over the period of 1984 - 1997. This report
aims to analyse TQM and Six Sigma practices and make a contrast between these two
methodologies. We also discuss how quality conformance and customer fulfilment are
achieved through the use of quality management method. At the end of this report, a
recommendation of the preferred methodology will be given based on our findings.

1. Introduction
As the current industrial world is becoming progressively changing and competitive,
businesses must be fully equipped of modern strategic approaches and resources to
achieve excellent performance thus generate outstanding profit. This outcome is unlikely to
be reached without a comprehensive and effective quality management system.
Organizations have already acknowledged the utmost importance of quality managing and
controlling for the last few decades. A study of Grandzol and Gershon (1998) reported that
around half of overall corporate training dollars were invested in quality concerns. Goetsch
and Davis (2014) consider total quality as a three-legged stool functioning based on
customer focus. The key objective of quality management therefore is enhancing customer
experience and satisfaction with consumed products through the acts of process
improvement, quality tools application and engagement of every business units with quality.

With the purpose of managing quality in an effective and efficient way, several advanced
quality initiatives have been introduced, among which Total Quality Management (TQM) and
Six Sigma have proved to bring significant results to organizations operating both in

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manufacturing and service areas. This report, which choose “automobile” as based object of
study, will make a contrast between goods and services in terms of perceived characteristics
and quality dimensions and subsequently illustrate on the application of TQM and Six Sigma
methodology in improvement of product quality. Finally, a justified recommendation would be
given on what method should be implemented (along with its possible risks) in order to
enhance the whole quality and value of products delivered to customers.

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2. Understanding the quality dimensions in products and services
For the purpose of delivering a high quality product/service, it is of crucial importance to form
a conceptual linkage with consumer’s critical points to accomplish quality gains (Garvin,
1987). Quality has multidimensional structure. When it comes to measuring the quality of a
specific product, the concept of goods vs. service quality dimensions should be
acknowledged and contrasted with each other in terms of encounter characteristics, i.e.,
what should be measured when assessing quality.

2.1. Contrast of Automobile as goods and services


Automobile can be regarded as consumer goods because of its tangibility and durability with
product characteristics like size, colour, shape and weight. An automobile is a product
created from manufacturing process with engagement of both machine and human
resources.

Automobile brands can offer an array of services associated with their manufactured
products. BMW provides their customers with various specialized services, such as
Derivenow, Reachnow, Parknow, Chargenow, Alphabet. All these services are aimed at
optimizing customer experience with the brand products.

2.2. Dimensions of product quality


In 1987, Garvin proposed 8 quality dimensions to a product which consist of: Performance,
Features, Reliability, Conformance, Durability, Serviceability, Aesthetics and Perceived
quality.

Multiple definitions of quality comprise user-based, manufacturing-based and product-based


quality. Durability, serviceability and reliability factors deal with experience regarding hassle-
free use of customer rather than with intended use. While performance and conformance are
the most objective product dimensions as they present the product primary features, the
factor group of perceived quality, aesthetics and feature essentially relates to consumer
opinions and preferences. Sebastianelli and Tamimi (2002)’s study point outs that quality is
defined as consumer-centric among manufacturing firms, which raises the necessity of
embracing the customer perspective in quality concept.

2.3. Dimensions of service quality


Service quality could be understood as the gap extent between customers’ desire and their
perception (Famiyeh, Kwarteng, & Asante-Darko, 2018). Parasuraman, et al., (1985) use 5
terms to describe service quality characteristics as Reliability, Responsiveness, Empathy,
Assurance and Tangibles. Johnson and Gustafsson (2006) emphasize the significance of
service quality as its expectedly consequential customer satisfaction will bring about
excellent business results. A study using SERVQUAL instrument to assess service quality in
a chain of car repair service (Miguel, daSilva, Chiosini & Schützer, 2007) came to the
conclusion that responsiveness and assurance are respectively considered by managers
and customers as most critical service quality dimensions.

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Table 1 represents quality dimensions to products and services and their characteristics
related to automobile – the chosen research object.

Quality Quality dimensions related to


Perceived factors
dimensions car (Features examples)

Primary product
Performance Speed, acceleration
characteristics

Features “Bells and whistles” Radio, warm seat

Chance of breaking down within


Reliability Frequency of failure
specific frame

Match with New release compared to past


Conformance
specifications model
Product quality
dimensions How long the car runs before
Durability Product life
cannot hold more repair

How much will it cost to have


Serviceability Cost of Repair
the car fixed, is it affordable?

Outside appearance, smell of


Aesthetics “Fits and finishes”
leather seats

Reputation and Manufacturer reputation,


Perceived quality
intangibles consumer’s opinion

Accuracy and
Produce error-free record,
Reliability dependability of service
provide promised services
performance

Well informed about


Willing, prompt service maintenance or guarantee
Responsiveness
offer service, never too busy to
respond
Service quality
dimensions Employees courtesy Staff knowledge of automobile
Assurance
and trust issues, safe dealings

Individualized attention Convenient service operating


Empathy
and caring time

Modern and sufficient


Physical facilities,
Tangibles equipment of car maintenance
personnel appearance
or repairs

Table 1: Product quality dimensions and service quality dimensions adapted from Garvin
(1987); Stylidis, Wickman & Söderberg, (2015); Zeithaml, Parasuraman & Berry, (1990)

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3. Stages/Process of Manufacturing an Automobile
According to the Toyota motor East Japan Inc, Car manufacturing can be divided into 3 main
stages:

 Development

 Product Preparation

 Production

3.1. Development
At this phase, the team generate new models and designs, bearing in mind the situation and
people's routines. They concentrate on enhancement in idea, style and strategies which are
intended to satisfy customers' needs.

The development procedures contain steps:

 Planning: Examining vehicle design concept,

 Designing: Resolving technical issues to make a drawing

 Prototype & evaluation: Evaluate performance through simulations and experiments

3.2. Product preparation


This phase require support skills which would produces the goods in compliance with
manufacturing methods. Competence and quality are concentrated factors.

Product preparation involves:

 Examination of productivity

 Process planning: verification of equipment, procurement of equipment

 Equipment try-outs, quality check, mass production

3.3. Production
At this stage automobiles are made in controlled and well-structured production line. Robots
and automatic conveyors are placed at each production process. Team efforts as well as
individual labour skills and ideas are particularly required to produce best quality vehicles at
reasonable cost.

This stage involves: Stamping, Welding, Painting, Assembly and Inspection.

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4. Total Quality Management (TQM) method
4.1. TQM definition and concept
Total Quality Management (TQM) is a never ending process of detecting and dramatically
reducing or eliminating any defects in manufacturing, restructuring supply chain
management, improving customer satisfaction and experience, and guaranteeing that all the
company’s employees are involved in decision making. William Deming is the founding
father of this method. Total Quality Management incorporates all units in the production
process, which mean everybody is responsible for the overall quality of the final goods or
service.

Figure 1: William Edward Deming, Total Quality Management Architect

The Union of Scientists from Japanese invited W. Edwards Deming in 1950 to teach
statistical quality control. He started managing the seminars about focusing on how to use
statistical processes to identify the connection between the quality of the product and
productivity. The Union also wanted him to do research relevant to design method,
production and sales with purpose of achieving better quality and satisfying customers. Plan
– Do – Check – Act (PDCA) cycle is systematically used to achieve problem solving. The
development, implementation and continuous improvement of this method were started to be
focused on in 1980s across Western countries. PDCA is highly recommended in the quality
assurance ISO/TS 16949 and constantly implemented in automobile manufacturing industry.

In order to indicate unceasing development within the automobile company, a shift in the
company’s core cultural ideology is required. This shift, when using TQM, is achieved by
giving everyone within the company responsibility in driving the quality and customer
satisfaction initiative forward. The engrossment of the employees in contributing towards the
decisions is significantly rewarding. By engaging all human resources, the company could
increase the prospect of good decisions by considering all in problem solving and having the
best solution going forward. The process of managing the quality of product from materials
procurement to assembly and ensuing conveyance must be of very high conformance. Even
if high quality standard of automobile product is reached and may be able to exceed
customer expectations and satisfaction, continuous improvement is always considered key
strategy for businesses to remain competitive.

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Figure 2: TQM three-legged stool (Goetsch and Davis, 2014)

4.2. PDCA methodology/process


The main focus of total quality management is customer satisfaction and also the
undisputable right of the customer to determine quality. External customers are ones who
purchase and consume our manufactured goods. Besides, internal customers who work
within the automotive company also play key roles in driving TQM methodology forward.

With firm understanding that the value of an automobile is dramatically reduced if the quality
standards expected by customers are not met, TQM implies the paramount importance of
meeting external customers’ needs and continuous adaptation to the changes in customers’
desires. PDCA methodology is used to guarantee the unremitting upgrading of the
automobile.

Figure 3: Deming Cycle (PDCA)

 Plan

In this Phase, we appraise the results and make plans to fix any issues within the stated
automotive company. These issues may include new external customer requirements, defect
reduction in the production line and internal customer recommendations.

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 Do

The firstly planned outcomes are to be implemented in small scale. A trial prototype is
produced and tested, the customer feedback is collected for contrivance of changes.

 Check

the data collected is then analysed to see whether customer satisfaction is achieved

 Act

New technique is applied customer feedbacks are endlessly considered and acted on in
order to achieve customer satisfaction goals

Automobile Manufacturing Companies use the PDCA method to focus on continuous


improvement, implementing solutions to problems and overseeing the continuous
advancement of creativity within product development. The board of management and all
employees of the company bear the obligation to follow authenticities of how to operate
under the PDCA method. Applying PDCA would bring efficient performance which focuses
on customer satisfaction and cost reduction. To improve and produce a higher quality
product in the automotive industry, the Look Ask Design Model along with Plan Do Check
Act Model lead to quality and financial performance boosts. However, continuous
improvement initiatives may fail to deliver due to the fact that they cannot specify the desired
method to put in place for successful operation of continuous advance.

4.3. Advantages of TQM methodology


- TQM leads to quality products manufactured at a very competitive price.

- Taking consideration of customers voice in product improvement process

- Reinforces the competitive situation of the automobile company

- High compliance to changing / developing market and environmental conditions and


other government regulations

- Helps increase the company brand and images

- With the” let’s get it right first time” mantra, its aim is produce error-free products

- Condensed costs and improved cost supervision which leads to huge profit margins

- Augmented customer fidelity and retention due to customer focus

- Employee morale is dramatically enhanced because every individuals in the


company is empowered

- Improved and innovative processes

4.4. Disadvantages of TQM methodology


- Can be substantially challenging and time-consuming to implement

- Huge costs associated with employee training schemes

- Late visible shown improvement (particular in financial figure)

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- With its focus on task calibration to ensure consistency in customer satisfaction
goals, it dampens creativity and innovation on alternative methods that can possibly
improve productivity.

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5. Six Sigma methodology
5.1. Six sigma as a methodology in quality management
Quality control, quality assurance and quality improvement are three key components in a
quality management system which emphasizes the importance of not only product quality
but the approach to attain that quality. Six sigma methodology offers a rigorous approach to
improve both process efficiency (i.e. best possible manner with minimum waste of
resources) and process effectiveness (i.e. function adequately to accomplish the process
purpose). In a quality point of view, Six Sigma is an initiative using statistical measurements
to accomplish the outcome of 3.4 defective parts per million opportunities (DPMO), which is
the virtual elimination of errors (Murphy, 1998). Six sigma concepts focus on recognizing
process problem and identifying opportunities that could result in defects so that the overall
process can be improved.

5.2. Promoting customer satisfaction by applying six sigma


The outcome of high-quality product and service can be attained by effectively managing
three key influential departments which are design, manufacturing, marketing along with
other involved divisions. In business environment, the operational process of each
department / element should then be analysed to achieve this goal. The design unit must be
advised of product quality characteristics perceived by customer. However, substitute
characteristics must be found to be directly related to the design concept while still meeting
customer requirements. For instance, customer may require a car with comfortable seating
area. This feature must be expressed on engineering drawing by respective technical term
or specification. Based on the designed ideas, desired products/service would be produced
by manufacturing unit and subsequently targeted to desired customers by marketing
department.

Six Sigma is one of the optimal methods employed by business to improve current
manufacturing condition thus enhancing customer satisfaction and diminish customer
dissatisfaction. In automobile industry, effective implementation of Six Sigma has brought
about outstanding performance results to world-class businesses, including Ford Motor
Company, General Motor, Denso and Motorola. Through the Define, Measure, Analyze,
Improve and Control (DMAIC) model, a business can make effective, prompt definition of
customer’s requirements and take quality measurements in order to improve its product at
each level stage.

5.3. DMAIC cycle


 Define

At the define phase, we need to know what the customer wants, the value we intend to
create and the target customer audience. A survey of customer needs and specified
requirement will be done at this stage. Having known customer needs, the define stage
defines the scope and extent of the production process, also a process flow map is
produced. The rationale behind this is to create benchmarks for work done based on what
the customer wants to enhance customer's satisfaction and process capability can be
measured effectively. We need to pay attention to all aspects of customer needs and
endeavour to deliver it to them. Production is ultimately based on customers requirement
which can be achieved through market survey (Pande, Neuman & Cavanagh, 2000).

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In the automobile industries, tools such as Shareholders analysis, Critical to quality tree
diagram, product analysis, affinity diagram, voice of customer and supplier input process
outputs customer (SIPOC) are used in the define phase. (Mutlu, 2010).

The define phase is applied in the Product development stage of automobile manufacture.
Where new models are created using evaluation of the environment and prospective
customers routines. Designs are made bearing in mind targeted customers hence produce
to meet their exact specifications.

 Measure

The measurement phase evaluates the company performance on meeting and satisfying
customers’ needs at present and in future time. It works with data on the competence of the
procedures put in place e.g. unit cost per product. The aim of this stage is to have satisfied
customers and efficient processes, identify main process measures, evaluate reliability in the
data measurement, plan data collection, collect data, ascertain the current performance
(Pande et al., 2000).

Measure phase uses tools such as data collection plan, control charts, capability analysis
and measurement system analysis.

In Automobile manufacture, Six Sigma’s measure stage is implemented in the Product


preparation before the main manufacture process. The phase focus is on efficiency and
quality of the product. Process planning of equipment will be executed and verified.

 Analyse

Under the analysis stage, causes of problems are identified and data is shown to prove it.
The data collected in the measurement phase are analysed to identify the main causes of
defects (Mutlu, 2010). This phase brings out key performance values to the process.

In manufacturing Automobiles, the following tools are used to implement the Analysis phase
of six sigma: Scatter plot diagrams, Box plot diagrams, Brainstorming, Cause and effect
diagrams, Failure mode and effect analysis, Design of experiment.

At the Development and product preparation stages of automobile manufacture, potential


technical issues are identified and resolved, data are collected and analysed for quality
checks.

 Improve

Improvement phase focuses on both remedial and precautionary activities. This phase would
provide optimal solutions to the problems identified in the Analyse phase. Plans for
executing the solutions are made which can include acquiring modern equipment, executing
organising training for workers, developing new working process.

Tools used in this phase may comprise: Brainstorming, Setup reduction, 5S, FMEA, DOE,
Kaizen and hypothesis tests. This phase is relevant to automobile manufacture in the
Development and Product preparation stage where technical problems are identified and
resolved, process planning is drawn.

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 Control

In the control phase, real performance of the process is controlled in continuous manner.
This phase ensures processes keep working according to standard, expected outcomes are
achieved and quality is maintained. This is applied in the production stage of Automobile
manufacture where processes are continually improved and controlled to ensure quality
production and customer satisfaction.

5.4. Advantages of Six Sigma Methodology


- Top-down strategy with engagement of quality experts – Master Black Belts, Black
Belts, Green Belts, Yellow Belts

- Focus on customer satisfaction and retention

- Six sigma eliminates waiting time, thereby reducing cycle time

- Defect reduction - Six sigma advocates for 3.4 defects per million opportunities
(DPMO)

- Culture change – Six Sigma is an improvement over TQM, CQI, BPR, ABC and loads
of other quality methodologies

- Product/service long-term growth – Six sigma is achieved with the long run product /
service development and improvement. (Pande et.al, 2000).

5.5. Disadvantages of Six Sigma methodology


- Cost and time consuming for personnel training

- Six sigma can be considered as a replacement approach for TQM

- It could be challenging to combine six sigma with other process methodologies for
other business divisions of the organization

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6. Conclusion - Comparisons between TQM and Six Sigma and
Recommendation
The main difference between Six Sigma and TQM is that TQM is mainly customer driven
while Six Sigma based on statistical data, variation and cost concepts. As we have already
mentioned, TQM focuses on giving every internal customers within the organization
empowerment in improving the quality and customer-based initiative while Six Sigma mainly
focuses on specific projects. It is significantly more straightforward to measure the results
using Six Sigma compared to TQM approach. In Six Sigma we emphasizes on eliminate
non-added value processes within manufacturing procedures which help to reduce costs.
This focus may, however, lead to a compromise in the quality of final products perceived by
customers, regardless of its meeting the required specifications.

In this scenario, in order to focus on the customer and how they perceive quality, we suggest
the implementation of TQM approach. Total quality Management implies that we are strictly
compliant with the voice of the customers. It is vital that we continuously pay attention to the
shifts in feedback from internal and external customers in order to provide a quality product
at competitive price. Considering the fact that customers always expect alterations and
additions to their products, Six Sigma tend to limit the process due to its main focus on
reducing defects in manufacturing. Quality can also be described as value for money.
Operating in automobile field requires the maintain of high competitive edge to stay in the
industry. TQM would help because it matches the customer requirements with value for
money. Everyone in a TQM culture organization is made to feel valuable when it comes to
decision making process. This would absolutely provide security within the organization
because TQM possibly help retain best-performed staffs and boost morale amongst
employees which definitely has great impact on production and subsequent profit margins.

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