LOVELY PROFESSIONAL UNIVERSITY DEPARTMENT OF MANAGEMENT Report on Summer Training Improving to the TOTAL QUALITY MANAGEMENT in Verka plant

Submitted to Lovely Professional University In partial fulfillment of then Requirements for the award of Degree of Master of Business Administration Submitted by: Nandlal Kumar University Reg. No. 3440070017 DEPARTMENT OF MANAGEMENT LOVELY PROFESSIONAL UNIVERSITY JALANDHAR NEW DELHI GT ROAD PHAGWARA PUNJAB

DECLARATION This is to state that the project titled Improving to the TOTAL QUALITY MANAGEMEN T in Verka plant is based on the original work carried out by me . This is submitted in partial fulfillment of the requirements of the MBA course i n LOVELY PROFESSIONAL UNIVERSITY. The matter embodied in this project report has not been submitted to any other U niversity or Institution for the award of degree. NANDLAL KUMAR

ACKNOWLEDGEMENT The satisfaction and the happiness that accompanies the successful completion of only task would be incomplete without expression of appreciation and gratitude to the people who made it possible.

Indeed I consider it as a pleasant duty, though equally difficult to acknowledge the motivating efforts of several people who have helped me in bringing this di ssertation Project to find its delight. I express my deep love and thanks to almighty. My sincere thanks to ASHWINI MISH RA, P.K.YADAV and DEEP KUMAR SHARMA who have guided me in undertaking this Proje ct. Finally, I owe my gratitude to my beloved parents and my dear most friends who h ave always stood by me and have been my moral support with sheer zeal and enthus iasm at the worry and I dedicate my work to them Lastly I also thank all the instructors those helped directly or indirectly for completion my project. NANDLAL KUMAR

CONTENTS 1. INTRODUCTION 2. PRODUCTS OF VERKA MILK PLANT 3. SWOT ANALYSIS 4. INTRODUCTION TO TOTAL QUALITY MANAGEMENT: 5. TQM :- A QUALITY ORIENTED APPROACH 6. CHARACTERISTICS OF TQM 7. OBJECTIVES OF THE STUDY 8 RESEARCH PROBLEM 9 METHODOLOGY OF THE STUDY 10 TEN STEPS TO TOTAL QUALITY MANAGEMENT (TQM) 11 APPLYING PRINCIPLES OF TQM ARE AS FOLLOWS 12 PROCESSES MUST BE MANAGED AND IMPROVED 13 Why TQM in Verka ???? 14 COST OF QUALITY??? 15 THE PITFALLS OF TQM 16 STEPS IN IMPLEMENTING TQM 17 PLANNING A CHANGE 18 TQM PROCESS IMPROVEMENT AND PROBLEM SOLVING SEQUENCE 19 FINDINGS AND RECOMMENDATIONS 20 BIBLIOGRAPHY

INTRODUCTION TO PROJECT The Punjab state cooperation milk producers federation Ltd. Popularly known as M ILK FED PUNJAB came into existence in 1973. It was backed by twin objective of pr oviding remuneration milk to the market. Although the federation was registered a lot earlier, it took the center stage of Punjab diary scenario in 1983 when al l the milk plants of Punjab dairy development corporation Ltd. Were handed over

to co operative sector and the entire state was covered under operation flood to give the farmer better value and customers better products.. The organizational set up of MILK FED is based on three systems:1. Milk producer co-operative societies at village level (primary cooperative so cieties). 2. Milk co-operative union of districts levels (unions). 3. Co-operative milk marketing federation as an apex body at state level (MILK F ED). MILK FED with its network of over 5000 village milk producer co-operative societ ies and three lacks milk producers from a strong network providing assured marke t to milk producers .MILK FED and its units have a workforce of about 5000 emplo yees and also provide regular employment to as out 600 transporters. NOTE ON COOPERATIVE DAIRY IN PUNJAB India becoming a member of the WTO and with recent removal of the Quantitative R estrictions (QR), by the Government of India, the days of protection are over. N ow Indian milk and milk products are highly vulnerable to international competit ion. The Indian Dairy sector is at a transnational phase where in it is graduall y emerging from being asocial household industry to a commercial sector..Althoug h the dairy and animal husbandry in India are as old as the civilization, it has always been perceived as support system to households and not considered as com mercial enterprise. In contrast, in the developed nations, dairy is a core busin ess where in every part of the milch animal is utilized for value addition to de rive best economic benefits. Technology interventions take place from the grass root levels in the breeding, animal feed, health care milk production and enhanc ement, milk collection and transportation and of course processing and marketing . The business enterprise ecosystem is therefore organized and mechanized from t he farm to the consumer. A critical component of the chain remains taking care o f hygiene, cleanliness and quality that are essential parameters for extending s helf life as soon as the milk comes out of the udder. In India Dairy being a sub system of agriculture, the animal, form an economic perspective, is primarily a converter of agriculture waste into a saleable product called milk. Majority of our milk production is localized, and practiced predominately by landless labour ers, small and marginal farmers. Due to lower input, labour and energy costs, th e milk production cost, in India, is one of the lowest in the world. India is th e largest milk producer in the world, which is at present 81 million tones per a nnum, amount to 13.81% of global milk production (579 million tones per annum) a nd holding largest number of milch animals (both buffalo and cow) which is aroun d 86.862 millions. We also have one of the lowest milk production costs on the w orld. MILK FEDS NETWORK Milk fed has its milk union in many districts of Punjab. Their district unions a re:Chandigarh Ferozpur Faridkot Bathinda Amritsar Sangrur Gurdaspur Hoshiarpur Jalandhar Ropar Patiala Ludhiana These unions in 12 districts of the state carry out smooth functioning of marke ting,procurement, cattle breeding program through district co-coperative unions

MILK PLANT JALANDHAR HISTORY:Milk plant Jalandhar, whose foundation stone was laid down by Dairy Development minister of Punjab and commissioned by Punjab dairy development corporation in A ug.It is spread construction of the plant was begun in 1986-87 and it started wo rking in 1986-87. It was registered under co-operative societies Act with Regist ration License No. 31/R-MMPO/93. There are three chilling stations working under this plant. ORGANISATION NETWORK For the smooth running of plant, various sections are managed by the the managem ent Each and every activity is delegated to particular section. These section ar e interrelated to have frequent contacts with one another and it is easy to shar e the information.These integrated tasks handle their problems and make the supe rvision easy. The following are the sections in the Verka Organisation: 1.Procurement Section 2.Production Section 3.Quality Control Section 4.Marketing section 5.Account Section 6.Administrative Section 7.Engineering Section 8.Purchase Section 9.Store Section 10.Secturity Section LOCATION:This plant is situated on the Amrister road, Jalandhar. It is seven kilometer aw ay from railway station, Jalandhar. CAPACITY OF PLANT:The plant has capacity for handling of milk 100000 liters per day. The plant can handle milk procurement up 1.5 Lac Liters as per installed capacity .The milk p lant can dry 1lac liters of milk to milk powder and manufacture ghee @ 7 MT per day . The plant has capacity to receive 100 M.T. of cream in addition to milk bu t the average procurement remained 49000 kg throughout the year. Management is a dvised to make best efforts to achieve the full capacity target. The total milk production in the milk shed is about 1439495 kg per day out of which about 86387 7 kg per day retained by the rural population as local consumption leaving about 575918 kg per day as marketable surplus for procurement by various parties invo lved in milk business in the milkfed CONTROLLING AUTHORITIES The milk plant Jalanddhar set up by Punjab government but in 1966 the controlled was passed on to Punjab Dairy Development co-operation and subsequently its man agement was passed to Milk Fed April 9, 1983. The Jalandhar district cooperative Milk producer union Ltd was registered on April 28th union has started his busi ness on July 1, 1988 with the complete control of plant to the union. Moreover a ll the assets and liabilities of Punjab Government and Punjab Dairy Development co-operation at the Milk Plant Jalandhar were transferred to union April 1, 1994 . The union has an elected board and managing director is on deputation from Mil k Fed. GOVERNMENT SUPPORT:Union finally functioned with share capital of Rs 10 lacks received from governm

ent which was later on enhanced to Rs 103 lacks. Under the operation flood, milk union, Jandhar has received plant and machinery, tanker and other assets on loa n cum grant basis. A loan was given by National Dairy Development Board amountin g to Rs 109.49 lacks (70% loan and 39% grant) in the year loan to meet its curre nt obligation. The union gets timely fund availability of working capital loan. MILK PROCUREMENT AT MILK PLANT:The procurement system of this milk plant is well organized. Milk procurement is made through Milk producers co-operative societies which are spread over whole of the Jalandhar. Under these societies, there are milk producer members. These members are chosen by village level societies from each village. These members c hoose a secretary who collect milk producers and sell to the plant and earn some percentage of commission. Milk is collected twice a day. Up to June 30.2002 milk plant Jalandhar has 738 f unctional societies out which 493 are working. While collection of milk, the fat contents of milk are properly tested in order the check the quality of milk bec ause the price is paid according to fat contents. CERBER & MILKOTESTS are the te sts applied to test protein and fat contents in milk. Production of Milk is conf ined to rural areas. Therefore,milk has to be collected and transported from pro duction points in the Milk Shed areas to processing and distribution points in c ities.The common system of collection of milk is by: (i) Cooperative Societies. (ii) Milk collection from own chilling centers, and (iii) From the Union of Punjab Federation COOPERATIVE SOCIETIES In the past the farmers used to sell their milk to the middleman. The middleman decided the price of the milk according to his convenience & profit. To change t he practice, the farmers in Gujarat decided to form societies comprising of farm ers having milk and so the cooperative societies were born. Formation of Dairy C ooperative societies in the villages is necessary for the dairy development of a ny state. Milk Plant Jalndhar also has a large number of Dairy Cooperative Socie ties from which plant collects raw milk both in flush and lean season.Presently 418 societies and around many member are supplying milk and making their contri bution to the Jalandhar (Punjab) Plant ,there are 21 routes where the trucks of verka goes to collect raw milk , such as 1.Manak Rai 2.Khiala 3.Ladhra 4.Tahli sahib 5.Gill 6.Kaluwal 7.Virk 8.Shadipur 9.Jalpot 10.Bassi 11.Ball 12.Noorpur 13.Samraj 14.Jaid 15.Baupur 16.Bhadas 17.Kuka 18.Daduwal 19.Kali 20.Chitti 21.Rampur CHILLING STATIONS:There are three chilling center in addition to main situated at Jalandhar. The m

ilk was procured through these three centers , These three have functioning fo r long time without machinery. The motive for opening these stations is to save the milk. The life of the milk is only five hours after it is collected. Some vi llages are more away from Jalandhar plant and transportation times much higher t han time. So these stations are opened to chill the collected milk so that the l ife of milk is increased against five hours. MILKO TESTER During the previous year milk plant purchased 25 milko testers for 630460.12 fro m M/S Rajasthan electronics LTD. 23 milko testers have been installed at differe nt societies 2 milko testers. MILKING MACHINES:During the 18 milking machines have been purchased out of which 7 (MOBILE) for R s 294000 & (FIXED) for Rs 368000 from M/S IDMC LTD and M/S vansun technologies , Noida 3 ( FIXED ) for RS 147000. Rate contract for supply of milking machine are made at head office level vide l etter no PSF/CTIP-Milking Mac/28458-69 dated 24/10/2008 and 50% subsidy is given on fixed & mobile Milking machine by Punjab Government procurement and balance 50 % would be recovered from the societies at time of installations as described by Dy Manager procurement .So cost of one milking machine fixed is Rs 23000 and Mobile Rs 21000 purchased from M/S IDMC and cost of one milking machine fixed i s Rs 24500 purchased from M/S VANSUN technologies, Noida 50% amount of subsidy r eceived from Punjab government through Milked Punjab vide credit note No.89 date d 13/02/2009 for Rs 690000 and balance 50% have been deducted from milk bill by mlik union. AIR/ WATER POLLUTION CONTROL: The pollution created by boilers smoke and affluent discharge is checked as per t he norms of the Punjab pollution control board, necessary devices have been inst alled. With the start of these equipment, the BOD of treated water (of treatment of work) being discharged into Municipal sewer is less than 30 i.e. well within norms. The treated water is used for irrigation purpose on the land of Milk pla nt. Thus there is reduction of pumping of water from earth strata. The result of this is 17, 00,000. MANAGEMENT AND MEETINGS:The board of directors comprises of 16 members out of which 10 members are elect ed. Two seats remained vacant and Four are government nominees namely Milkfed, N DDB, and dairy development department. During the period under report 4 meetings of BOD were held. PRODUCTS OF VERKA MILK PLANT Milkfed has formulated company specifications for its milk and milk products to Provide standard and quality of products to consumers. 1.Milk 2.Ghee 3.cheese 4. Curd 6.Butter7.Milk powder 8.SFM 9.Lassi MILK:Milk Plant has to maintain company specifications for its milk and milk Products to provide standard and quality of products to consumers. In Milk Plant Jalandh ar four different kinds of milk are processed and packed. (I) Standard Pasteurized Milk. (II) Pasteurized Double Tonned Milk (iii) Pasteurized Skimmed Milk (iv) Premium ( Full Cream ) Milk It is pouch packed milk. It may be used as such or for milk based preparation. I t shall be kept under refrigerated conditions. It packed in half liter. Pouch. I ts length of shelf life is 48 hours under refrigerated conditions. It is sold in arid around Pathankot, Jammu. Special distribution control is needed, under ref

rigerated condition if transported to very long distance. GHEE Ghee may be defined as clarified butter fat prepared chiefly from cow or Buffalo milk. The product can be used on roti /pranthas or can or can be used as cooking other material for food. It is preser ved at ambient temperature for one year. It is packed on 500 gms, 2 kgs, 5 kgs a nd 15 kgs. Bulk pack in tin. It is sold anywhere in Punjab and abroad also. No s pecial distribution control is needed. CHEESE Ice Cream may be defined as a frozen dairy product Cheese refers to the small si zed soft paneer. The product can be consumed as such or can be fried and consume d. It can also be used as an ingredient for making Indian sweets and paneer base d dishes. It is preserved under refrigerated condition for 20 days from the date of packing. The product is packed in poly film bags. CURD Dahi or curd is the product obtained from boiled milk by souring, natural or oth erwise, by a harmless lactic acid or other bacterial culture, it should have the same percentage of fat and solids-not-fat as the milk for which it is prepared. BUTTER Butter may be defined as a fat concentrate which is obtaining by churning cream, gathering the fat into a compact mass and then working it. The product obtained from cow and buffalo milk or a combination there of or from cream or curd obtai ned from cow or buffalo milk or a combination thereof with or without the additi on of common alt and colouring matter. It can be kept under refrigeration for th ree months this comes in packs of 10 gms. 100 gms and 500 gms. MILK POWDER Dried milk or milk powder is product obtained by the removal of water from milk by heat or other suitable means to produce a solid containing 5% or less moistur e. Whole milk, defatted or skim, milk may be used for drying. It comes in packin g of 200 gms , 500 gms.etc. It can be stored for1 year before use.

SFM It is known as sweetened flavored milk or bottle milk. The product used in the f orm of drinking milk. It is preserved at ambient temperature. It is packed in 20 0 ml. Bottle, 200 ml. Tetra packs. The length of shelf life of product can be he ld for three months under ambient temperature. It is sold in and around Punjab LASSI Lassi, also called chhas refers to desi butter milk which is by product obtained when churning curd led whole milk with curd indigenous devices for the producti on of desi butter. Verka Lassi is very popular, especially in Punjab. OBJECTIVES OF VERKA MILK PLANT If we keep our customer happy, they will keep us in business. Every organization get success through giving proper satisfaction to its customer .customer satisf action is the basis for any successful organization. Milk plant follows this rule and has some objective to operate its business:Working capital 1. To carry out the activities to economy development of agriculturists by organ izing effectively production, processing marketing of milk products as per direc tion of federation 2. To provide better facilities to milk producer so as easily availability of mi lk can become possible and for their development. 3. To purchase commodities from the member and deal with non-members for marketi ng, dairy and allied products subject to such conditions as may be decided by th

e board from time to time. 4. To establish research and quality control laboratories 5. Constant up gradation of producers and process for better product quality ado pting food safety management system to ensure total safety to customer health . The company had a following LOGO for consumer satisfaction:WE SHALL ENDEAVOR TO BE MARKET LEADERS IN DAIRY INDUSTRY SWOT ANALYSIS STRENGTH;1. Minimum interference from top management in day to day working. 2. Qualified experienced and devoted workforce. 3. Brand name- VERKA. 4. Direct contacts with milk producers. 5. Own cattle feed plant and folder seed grading station for supplying certified fodder seeds. 6. Technical and financial guidance and support from Milk fed head office Chandi garh as well as national development dairy board. 7. Good corporate governance and socially responsible organization. WEEKNESS:1. Highly competitive market. 2. Financial position of plant is very week from many years. 3. Sufficient working capital is not available. 4. Less facilities for Transportation of milk. 5. Problems in research and development. OPPORTUNITIES:1. Milk chilling centre falling in district Jalandhar, if handed over to Jalandh ar union milk. Procurement can be increased. 2. Veterinary health care and breeding facilities is to be increased for improvi ng for genetic milk yielding characters of animals. 3. Feasibility of home delivery system for city supply milk to be applied. 4. General land of milk plant can be used for research and cultivation. THREATS:1. Increasing salary bills as compared to turnover. 2. Higher cost of raw materials as compared to pricing policy 3. Border tensions and river floods. 4. Non adoption of dairy farming as a side business by farmers. INTRODUCTION TO TOTAL QUALITY MANAGEMENT: "TQM is a management approach of an organization, centered on quality, based on the participation of all its members and aiming at long-term success through cu stomer satisfaction, and benefits to all members of the organization and to soci ety." In Japanese, TQM comprises four process steps, namely: 1. Kaizen Focuses on Continuous Process Improvement, to make processes visible, repeatable and measureable. 2. Atarimae Hinshitsu Focuses on intangible effects on processes and ways to opt imize and reduce their effects. 3. Kansei Examining the way the user applies the product leads to improvement in the product itself. 4 . Miryokuteki Hinshitsu Broadens management concern beyond the immediate produ ct. TQM requires that the company maintain this quality standard in all aspects of i ts business. This requires ensuring that things are done right the first time an d that defects and waste are eliminated from operations. Total Quality Managemen t (TQM) is a management strategy aimed at embedding awareness of quality in all organizational processes. TQM has been widely used in manufacturing, education, government, and service industries, as well as NASA space and science programs.

ORIGINS Although W. Edwards Deming is largely credited with igniting the quality revolut ion in Japan starting in 1946 and trying to bring it to the United States in the 1980s, Armand V. Feigenbaum was developing a similar set of principles at Gener al Electric in the United States at around the same time. "Total Quality Control " was the key concept of Feigenbaum s 1951 book, Quality Control: Principles, Pr actice, and Administration, a book that was subsequently released in 1961 under the title, Total Quality Control (ISBN 0070203539). Joseph Juran, Philip B. Cros by, and Kaoru Ishikawa also contributed to the body of knowledge now known as TQ M. The American Society for Quality says that the term Total Quality Management was first used by the U.S. Naval Air Systems Command "to describe its Japanese-s tyle management approach to quality improvement."[1] This is consistent with the story that the United States Department of the Navy Personnel Research and Deve lopment Center began researching the use of statistical process control (SPC); t he work of Juran, Crosby, and Ishikawa; and the philosophy of Deming to make per formance improvements in 1984. This approach was first tested at the North Islan d Naval Aviation Depot. In his paper, "The Making of TQM: History and Margins of the Hi(gh)-Story" from 1994, Xu claims that "Total Quality Control" is translat ed incorrectly from Japanese since there is no difference between the words "con trol" and "management" in Japanese. William Golimski refers to Koji Kobayashi, f ormer CEO of NEC, being the first to use TQM, which he did during a speech when he got the Deming prize in 1974. TQM :- A QUALITY ORIENTED APPROACH Total Quality Management (TQM) is one of quality-oriented approaches that many o rganisations adopt. It is generally acknowledged that manufacturing companies ne ed to be quality oriented in conducting their business to survive the business w orld. TQM is an integrated management philosophy and a set of practices that emp hasise top management commitment, customer focus, supplier relationship, benchma rking, quality-oriented training, employee focus, zerodefects, process improveme nt, and quality measurement. This paper investigates the structural linkages between TQM, product quality per formance and business performance in the electronics industry in Malaysia. Given the nature of this study, the statistical analysis technique called Structural Equation Modelling was used. This preliminary result suggests that there is insu fficient statistical evidence to conclude significant simple relationships betwe en TQM, product quality performance, and business performance. This implies that the electronics industry cannot assume direct causal linkages between these thr ee constructs, which might also suggest that there is a more complex relationshi p between TQM, product quality performance, and business performance. However, t he results reveal that top management commitment, supplier relations and trainin g in particular appear to be of primary importance for TQM practices in Malaysia n electronics companies. CHARACTERISTICS OF TQM: The characteristics of TQM, as revealed from above definition are as follows: 1. TQM is customer oriented. 2. TQM requires a long term commitment for continuous improvement of all process es. 3. The success of TQM demands the leadership of top management and continuous in volvement. 4. Responsibility for establishments and improvement of systems lies with the ma nagement of an organisation. 5. TQM is a strategy for continuously improving performance at all levels and in all areas of responsibility. OBJECTIVES OF THE STUDY: General Objective To study how TQM can be used effectively as a tool in Verka industries Specific Objectives

To study the basic principles of TQM & its application in Verka To study the effective implementation of TQM in Management functions

RESEARCH PROBLEM Almost every company is worried about their quality, no matter what department i t is. The reason for this is that your overall quality can actually affect your relationship with your customers and in manufacturing your customers are everyth ing. Basically in manufacturing if your customers are not happy with your qualit y they are not going to use your company which means you are going to suffer whe n it comes to sales and overall profits. But if your customers are happy with yo ur quality then they are going to come back over and over again, not to mention refer you to other companies,which can in turn increase your sales and improve y our overall profits. So, we should seriously consider implementing a new total q uality management program today. Here are some things to think about when it comes to how total quality managemen t can affect your manufacturing plant. METHODOLOGY OF THE STUDY Sources of data The data used in this project are secondary data in the form of cases. The data relates to the information about the company profile, product profile and produc tion. The secondary data relates to the financial data used for the analysis. It was collected from the audited annual reports of the company. TOTAL QUALITY MANAGEMENT(TQM) : Total = Quality involves everyone and all activities in the company. Quality = Conformance to Requirements (Meeting Customer Requirements). Management = Quality can and must be managed. TQM = A process for managing quality; it must be a continuous way of life; a philosophy of perpetual improvement in everything we do. TQM Compared to ISO 9001 : ISO 9000 is a Quality System Management Standard. TQM is a philosophy of perpetual improvement. The ISO Quality Standard sets in place a system to deploy policy and verifiable objectives. An ISO implementation is a basis for a Total Quality Management implementation. Where there is an ISO system, about 75 percent of the steps are in place for TQM. The requirements for TQM can be considered ISO plus. Another aspect relating to the ISO Standard is that the proposed changes for the next revision (1999) will contain customer satisfaction and measurement requirements. In short, implementing TQM is being proactive concerning quality rather than reactive. TQM as a Foundation : TQM is the foundation for activities, which include; Meeting Customer Requirements Reducing Development Cycle Times Just In Time/Demand Flow Manufacturing Improvement Teams Reducing Product and Service Costs Improving Administrative Systems Training TEN STEPS TO TOTAL QUALITY MANAGEMENT (TQM): The Ten Steps to TQM are as follows: 1. Pursue New Strategic Thinking 2. Know your Customers 3. Set True Customer Requirements 4. Concentrate on Prevention, Not Correction 5. Reduce Chronic Waste 6. Pursue a Continuous Improvement Strategy 7. Use Structured Methodology for Process Improvement 8. Reduce Variation

9. Use a Balanced Approach 10. Apply to All Functions APPLYING PRINCIPLES OF TQM ARE AS FOLLOWS: 1. Quality can and must be managed. 2. Everyone has a customer and is a supplier. 3. Processes, not people are the problem. 4. Every employee is responsible for quality. 5. Problems must be prevented, not just fixed. 6. Quality must be measured. 7. Quality improvements must be continuous. 8. The quality standard is defect free. 9. Goals are based on requirements, not negotiated. 10. Life cycle costs, not front end costs. 11. Management must be involved and lead. 12. Management Commitment 1. Plan (drive, direct) 2. Do (deploy, support, participate) 3. Check (review) 4. Act (recognize, communicate, revise) 13. Employee Empowerment 1. Training 2. Suggestion scheme 3. Measurement and recognition 4. Excellence teams 14. Fact Based Decision Making 1. SPC (statistical process control) 2. DOE, FMEA 3. The 7 statistical tools 4. TOPS (FORD 8D - Team Oriented Problem Solving) 15. Continuous Improvement 1. Systematic measurement and focus on CONQ 2. Excellence teams 3. Cross-functional process management 4. Attain, maintain, improve standards 16. Customer Focus 1. Supplier partnership 2. Service relationship with internal customers 3. Never compromise quality 4. Customer driven standards Plan and organize for quality improvement. PROCESSES MUST BE MANAGED AND IMPROVED: Processes must be managed and improved! This involves: Defining the process Measuring process performance (metrics) Reviewing process performance Identifying process shortcomings Analyzing process problems Making a process change Measuring the effects of the process change Communicating both ways between supervisor and user Key to Quality: The key to improving quality is to improve processes that define, produce and su pport our products. All people work in processes. People Get processes "in control"

 Work with other employees and managers to identify process problems and eliminat e them Managers and/or Supervisors Work on Processes Provide training and tool resources Measure and review process performance (metrics) Improve process performance with the help of those who use the process Why TQM in Verka ???? There are several benefits of applying TQM in a company these can be enlisted un der various heads but to ease them let`s study them under the heads of benefits that TQM application in a firm gives to management and employees:1.For management:(a) Provides an invaluable problem-solving tool for managers and supervisors to use (b) Dispels negative attitudes (c) Management becomes more aware of problems that affect the individuals work en vironment (d) Employees gain a sense of participation (e) Increases efficiency and productivity (f) Reduces turnover rate, tardiness, costs, errors,and scrap & rework (g) Improves communications within and among all departments (h) Develops management skills that were never taught, or are long forgotten due to lack of application (i) Develops overall company awareness and company unity (j) Rearranges priorities which once seemed locked in place (k) Builds loyalty to the company (l) Reveals training requirements in all departments (m)Lessens the number of defects received from suppliers when they are encourage d to train in quality management 2.For Employee:(a) Provides opportunity for personal growth and development (as a result of tea m training activities) and the opportunity to develop and present recommendation s (b) Increases innovation (through a greater variety of approaches and perspectiv es) for solving problems, removing fear of failure (c) Employees use their knowledge and skills to generate data-driven recommendat ions that will lead to well informed decision-making (d) Encourages decision-making at the most appropriate level (e) Increases motivation and acceptance of new ideas (f) Increases job satisfaction (as a result of the opportunity to participate in and have influence over work) (g) Recognizes employees for their knowledge, skills, and contribution toward im provement (h) Develops mutual respect among employees, management and customers (i) Promotes teamwork Reducing rework to zero is achievable: Using quality management and CI to reduce rework to nearly zero is an achievable goal. The negative cost of quality, whic h includes errors, delays, rework, etc., is estimated to be 30 percent of the co st of construction. This figure does not include dissatisfied owners/customers w ho do not come back for repeat business. COST OF QUALITY??? Why do we implement the above information into our companies? To make more money and/or to stay in business. If you dont implement TQM/CI, it will cost your firm money. Its managements choice to obtain these improvements. Failure to implem ent quality processes results in a status quo situation where unnecessary costs remain and improvements are not implemented. Noted here are the costs of nonconformance. Cost of Quality = Cost of Non-conformance + Cost Prevention

Areas where savings can be derived by making improvements are noted here:1.Inspection of direct hire work 2.Inspection of subcontractor work 3.Inspection at vendor source of supply 4.Inspection of shipments 5.Review of shop drawings 6.All training costs, including safety 7.Facilitator costs 8.Salary of quality coordinator, if needed 9.Meetings of the steering committee and quality improvement teams 10. Administration of the quality management program 11. Reward system Cost-Categories for unacceptable work Work areas that affect cost are listed here: 1.Rework/revisions 2.Complaint resolution 3.Insurance premiums/coverage 4.Remove/replace 5.Bonding limits and costs 6.Write-offs 7.Un-billed charges 8.Overdue receivables 9.Claim defense 10. Change order redesign (engineers and architects) 11. Ineffective interdisciplinary coordination 12. Accept as-is, with credit to client 13. Ineffective trade coordination 14. Unplanned field services 15. Call-backs 16. Unrecorded time 17. Unplanned premium overtime 18. Disputed invoices 19. Unpaid time 20. Repetitive quality assurance 21. Invoice errors 22. Unpaid invoices 23. Accept as-is, with no extra compensation The high cost of poor quality Facts to consider when counting the high cost of poor quality are: 1.What is poor quality costing you? 2.Waste is the opposite of quality. 3.The tangible costs of poor quality include rework, accidents, missed schedules , unused labor, liability and insurance, and scrapped materials. 4.The intangible costs of poor quality include lost customers, never-had customers who went elsewhere because of what they heard from unhappy customers, and poor morale among employees and stakeholders. THE PITFALLS OF TQM The transformation to quality is not without its pitfalls. Many companies have s tarted on the road to quality but failed to achieve success due to several facto rs: 1.Lack of top management support. 2.Lack of middle management support. 3.Commitment in only one department. 4.Short-term commitment - failure to stay on course. 5.Haphazard approach - a little of this and that with no meaningful change in th e system.

6.Failure to acquire the services of a competent statistician or to provide stat istical training for employees. 7.Measure success and guide program on the basis of short-term profits. 8.Failure to solicit worker input. 9.Over dependence on computerized quality control. 10. Funding failure - lack of funds to make meaningful changes in the system (i. e., new machinery, training, improved raw materials). 11. No market research. Not knowing what the requirements are. 12. no testing of incoming materials - garbage in - garbage out. 13. Overselling hourly workers - expecting instant pudding. 14. Adversarial management (management by fear). However, with total commitment and constancy of purpose, these hazards can be ov ercome. STEPS IN IMPLEMENTING TQM 1 Obtain CEO Commitment 2 Educate Upper-Level Management 3 Create Steering Committee 4 Outline the Vision Statement, Mission Statement, & Guiding Principles 5 Prepare a Flow Diagram of Company Processes 6 Focus on the Owner/Customer (External) & Surveys 7 Consider the Employee as an Internal Owner/customer 8 Provide a Quality Training Program 9 Establish Quality Improvement Teams 10 Implement Process Improvements 11 Use the Tools of TQM 12 Know the Benefits of TQM Continuous Improvement 1.Obtain CEO Commitment The first step in implementing TQM is to obtain the total commitment, involvemen t, and leadership of the CEO and upper-level management. 2.Educate Upper-Level Management :- The second step is to teach the CEO and uppe r-level management how to conduct the following: a) Undergo quality training b) Commit to TQM and provide the necessary resources of time and money to permit improvement c) Assist in the development of the corporate vision statement, mission statemen t, guiding principles, and objectives d) Serve as a model of expected behavior e) Actively lead the way by participating in the activities of the quality steer ing committee and company training f) Drive fear out of the organization g) Provide suitable recognition for those who contribute to the quality mission h) Drive decision making and problem resolution to the lowest practicable level 3.Create a Steering Committee Upon completion of upper managements commitment and training, a steering committe e must be created to guide the company through the process of implementing TQM. The role of the steering committee and the processes the committee follows are l isted here. a) Steering committee roles are . . . Review and evaluate customer surveys. i. Determine processes to be improved, based on customer and employee recommenda tions, surveys, and a knowledge of existing problems. ii. Appoint task process improvement teams and ensure they receive proper traini ng.

iii. Monitor process improvement. iv. Oversee employee recognition for quality improvement. v. Communicate successes and progress. b) The steering committee handles a problem by . . . i. Problem is brought to the attention of the steering committee ii. Steering committee forms a team to examine the process and make necessary recommendations for improvement iii. Team meets, reviews its mission, and determines how often it will meet. The problem is assigned to the team following the procedures outlined in #10, The Structure Approach to Process Improvement. 4.Outline the Vision Statement, Mission Statement, & Guiding Principles a) Establishing guiding principles:In developing the fourth step, important principles to consider including in the companys vision statement, mission statement, and guiding principles are as foll ows: i. Owner/customer Satisfaction ii. Improved Safety iii. Elimination of errors and defects iv. Doing things right, the first time v. Reputation as the best in the field vi. Continuous Improvement vii. Employee Empowerment 5.Prepare a Flow Diagram of Company Processes A mechanical contracting firm created the TQM flow diagram illustrated in the fi gure below to implement quality processes within the company 6.Focus on the Owner/Customer (External) & Surveys Focusing on a customers concerns Still one of the best ways of accomplishing quality improvement is obtained by f ocusing on customers concerns, and by learning what those concerns are through ow ner/customer surveys. Much can be provided by studying how your owner/customer f eels about your service, your attitude, and whether you would be recommended to another owner/customer. Several areas to survey, and to take care to provide or honor, are listed here. a) Safe operating procedures b) Accident experience c) Attitude d) Professional competence of the project manager, superintendent, and project e ngineers. e) Technical competence of the work force f) Overall responsiveness to owner/customer requests g) Degree of communications h) Planning i) Administrative procedures j) Appearance and conduct of the work force k) Condition of equipment l) Coordination and supervision of subcontractors m) Appearance of the job-site n) Timeliness o) Your product/service delivery system p) Your product/service performances q) Your product/service delivery system r) Your product/service performance s) The general image of your company t) Your peoples level of performance u) The perceived price-value relationship of your product/service v) Your competitors strengths and weaknessess

7.Consider the Employee as an Internal Owner/Customer In order to conduct an analysis of the internal processes within the company, th e following steps should be applied to the internal processes within a company. a) List several of your internal owners/customers within your company b) Choose one of these owners/customers to focus on for the application of this technique c) Determine the Outputs (products, services, information) that must be provided to this internal owner/customer d) Determine the work Processes your company uses to produce these Outputs e) Learn how your customers expectations are met and how satisfaction is measured 8.Provide a Quality Training Program Which employees are trained first? The successful TQM company provides training to employees in the order illustrat ed in the figure below. The training program must begin with upper management, t hen training must be provided for the remaining management, and the in-house tra iners and facilitators. It cannot be emphasized enough that if upper management is not trained and is not a viable, visible participant from the beginning, then the program will not survive. How are management and other employees trained? In order to implement the training mentioned above, the following process should be undertaken: a) Select a consultant, community college, or other training b) Train management c) Select trainer, facilitator d) Send trainer, facilitator to training e) Trainer trains front-line supervisors f) Trainer trains remaining employees g) Establish a training committee h) Orient short-term hires and new employees i) Facilitator or trainer provides team training j) Establish long-term, continuing program for training in quality management, l eadership, communication, technical skills k) Evaluate all training l) Improve training A Upper Management B Remaining Management C In-House Trainers & Facilitators D Front-Line Supervisors E Non-Supervisory Employees F Team Training G Training of Subcontractors & Suppliers Continuous Training 9.Establish quality improvement teams Quality improvement teams focus on . . . In establishing quality improvement teams, a smaller company might assign one qu ality improvement team. Larger firms might assign several, possibly with one qua lity lead team as a guide for the other teams. Areas where quality improvement t eams could begin investigating for possible improvement are: a) Increased Employee Value b) Informed Employees c) Technical Training d) Quality Training e) Employee Suggestions f) Employee Participation g) Higher Quality of Artistry h) Personal Development

Good QIT member qualities are . . . Representatives who are selected to be quality-lead team members should possess the following attributes: i. commitment to quality, customer satisfaction, and the success of the organiza tion ii. good communication and interpersonal skills iii. a big picture view of the organization and of the industry iv. a strong commitment to learning and change v. representation of a different area and level of the organization vi. good organizational skills Quality improvement team tasks are . . . Quality improvement teams are active in the following task areas: a) Identify the customers of the process b)Determine customer expectations c) Flowchart the process d) Identify all of the inputs and interfaces e) Identify the output(s) f) Systematically review the procedures currently being used in the process g) Collect and analyze available quantitative data h)Determine the need for additional data i) Identify the problem(s) j) Determine the root cause of the problem k)Determine potential solutions l) Select a trial solution m) Present recommendations to the steering committee n) Implement the solution on a pilot-project basis o)Analyze the data to discern if there has been improvement p) The quality improvement team (QIT) is responsible for planning and managing t he TQM implementation process for the organization. The QIT is responsible for m aking TQM happen. q) The QIT must take the lead in managing the cultural changes that TQM will require. r) At least one member of the Senior Management Team (SMT) should be a member of the QIT. s) The QIT reports to the Chief Executive Officer (CEO) and the SMT. The QIT and SMT should hold a joint meeting to review the TQM effort at least quarterly. 10. Implement Process Improvements a) Management interest and support b) Focus on customer satisfaction c) Identification of areas needing improvement d) Employee involvement e) Cooperative attitude between elements of the company f) Viewing every person who is on the receiving end of a process as a customer g) Fear driven from the company h) Correctly composed teams i) A system for selecting processes to be improved j) Training for all employees in quality awareness k) Training for teams in team procedures and disciplined problem solving l) Improved communications outside the company The structure approach to process improvement i. Problem is brought to the attention of the steering committee ii. Steering committee forms a team to examine the process and make necessary re commendations for improvement iii. Team meets, reviews its mission, and determines how often it will meet iv. Training is initiated for team members v. Team meets weekly for an hour or two to analyze the problem and develop a sol

ution vi. Solution is initiated on a pilot basis vii. Results of pilot study are examined viii. Solution is implemented company-wide 12. Use the Tools of TQM Seven classical tools of quality and process improvement, plus one, are presente d below. Tool Use Flowchart:Portrays all the steps in a process. Helps understand the process. Cause and Effect Diagram: Portrays possible causes of a process problem. Helps determine root cause. Control Chart :Shows if a process has too much variation Histogram :Portrays the frequency of occu rrence. Check Sheet :Tabulates frequency of occurren ce Pareto Diagram : Visually portrays problems and ca uses in order of severity or frequency. Helps determine which problem or ca use to tackle first. Scatter Diagram :Helps determine if two variables a re related Run Chart:Shows variation and trends with time. Provides baseline data, and helps to determine if a process is improving or not. 12.POTENTIAL BENEFITS OF TQM: The advantages of adopting TQM system compared to conventional quality system ar e numerous and are outlined below. 1. TQM helps to focus clearly on the needs of the market. The traditional approa ch of quality control focusses on the technical details of a product so as to sa tisfy the customer. However, the customer longs for different satisfaction persp ectives which are generally overlooked in the traditional approach.The needs cha nge from person to person and also from place to place. As TQM focuses on the co ncept of university, it tries to abstract the satisfaction perceptions of the ma rket and thus helps the organisation to identify and meet the requirements of th e market in a better way. 2. TQM facilitates to aspire for a top quality performer in every sphere of acti vity. It is a well accepted fact that the negative attitudes of employees and no nparticipative culture of the organization pose the greatest hurdle to organisat ions success, growth and prosperity. TQM emphasis, on bringing about attitudinal and cultural change through promotion of participative work culture and effectiv e team-work. This serves to satisfy the higher human needs of recognition and se lf-development and enhances employees interest in the job. The employees performan ce, thus, is not restricted to the product or service areas but reflects in othe r spheres as well. 3. It channelizes the procedures necessary to achieve quality performance. Quali ty in its true sense can not be achieved instantly. It requires a systematic and a long-term planning and strategic approach. By focusing on defining the qualit y policies, goals and objectives, and communicating these properly to one and al l in the organization, adopting SQC and SPC techniques and developing and using a system of evaluation , the organization can channelize their efforts to achiev e the desired and objectivated quality performance. 4. It helps examine critically and continuously all processes to remove nonprodu ctive activities and waste. The organizations always aim at improving productivi ty as it leads to reduction in cost resulting in increase in profitability. The efforts in this direction are contributed because of the formation of quality im provement teams which meet regularly and through a systematic approach which tri

es to remove nonproductive activity. A continuous effort to identify the problem s and resolve them helps to reduce the waste. The culture of well being thus imp roves housekeeping, cost-effectiveness and safety. 5. It gears organizations to fully understand the competition and develop an eff ective combating strategy. The dynamic changes in the global market and the open market policies adopted by a large number of organizations has resulted in increased competition and for m any organizations the survival has become a key issue. For this cause it is esse ntial for the organistions to understand the competition and develop and adopt s uitable strategies to meet the challenges. As TQM helps to understand the pulse of customer and thus the market, it gives an edge to the organizations of variab le nature to meet the competition. 6. It helps to develop good procedures for communication and acknowledginggood w ork. Improper procedures and inadequate communication are yet another bane of ma ny organizations, which result in misunderstanding, confusion, low productivity, duplication of efforts, poor quality, low morale and so on. TQM brings together members of various related sections, departments and different levels of manage ment thereby providing an effective vehicle of communication and interaction. 7. It helps to review the process needed to develop the strategy of never ending improvement. Quality improvement efforts cannot be restricted to any time perio d. They need to be continuous to meet the dynamic challenges. TQM emphasizes on a continuous and periodic review so as to make the required changes. The benefit s derived by the organizations, therefore, are many and multifaceted. Many of th ese can be measured in quantitative terms. However, the intangible benefits, whi ch includes enrichment of the quality of the work life and many more are not qua ntifiable. At the same time, it has to be established whether they do occur or n ot in order to prove or disapprove the efficacy of the concept. This can be asse ssed by a well-planned research project or by carrying out an opinion survey per iodically. The tangible and intangible benefits of TQM are variable in nature

PLANNING A CHANGE:-

FINDINGS AND RECOMMENDATIONS 1. The customer cadre of Verka milk is mainly divided into Bulk users and C ustomary users. 2. There is relatively more awareness among the bulk users for the brand ow ing to one or more of the following reasons: a. Higher price that is not meeting the competitors rate as bulk user are v ery price sensitive. Other milk dairies are providing higher margin. b. In sweet marts mawa generation is less and there is a complaint about cu ddling of milk. c. In case of canteens contract some of them prefer credit purchasing which is against companys norms and policies. 3. The parameters that affect the most are Price, Taste, Service and Access ibility 4. Milk market is a totally unpredictable market and the organization shoul d be over-cautious of any complaints that come into milk as it includes the sent iments of a mother for her kid and she would not prefer to give anything to her kid for which she is not 100% satisfied. 5. Some of the observations of the Project cannot be generalized as the ext raction of information from the dignified sources cannot be solely trusted at, s ince the shopkeepers and concerned authorities tend to hide some of the facts an d figures thereby liberating only vague data for further analysis.

6. Studying the market scenario, the prime suggestion here will be that in order to reap more profits, Verka Milk can cut costs to a sub-acceptable margin for a substantial time and follow it with the core idea of aggressive advertisin g. 7. Rather than spending more on technology upgrade, Verka Milk can devise a n effective plan for quality control (TQM plan) as quality serves as the most cr itical factor deciding final sales. 8. Remove communication barriers and misconceptions between the Institution s and distributors by effective communication with institutions time to time as this would finally lead to the generation of grievance redressal and thus aid in Quality Control in the plants. BIBLIOGRAPHY 1 Gerring, J. (May 2004) What is a case study and what is it good for? Ame rican Political Science Review. Vol. 98, No. 2. (341-354). 2 Scholz, R. W. and O. Tietje (2002). Embedded case study methods: integra ting quantitative and qualitative knowledge. Thousand Oaks, Calif., Sage Publica tions. 3 Yin, R. K. (1994). Case study research: design and methods. Thousand Oak s, Sage Publications. 4 ^ "Six Sigma vs. Total Quality Management". Retrieved April 19, 2010. 5 Crosby, Philip B. Let s Talk Quality: 96 Questions You Always Wanted to ask Phil Crosby (1989) 6 Deming, W. Edwards. Out of the Crisis (1986) 7 Ishikawa, Kaoru. What is Total Quality Control? The Japanese Way (1985)