1. Chapter 16
Managing Quality and Productivity
http://www.slideshare.net/Subjectmaterial

2. QUIZ
1. In a production business what is most
important in order to get more profits
 One word answer
2. How would you ensure your
customers stay with you
 3 bullet points
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3. Sr. Chapter Chapter Heading
No.No.
1. 3 Understanding the Global context of business (031012)
2. 4 Conducting Business Ethically and Responsibly (250212)
3. 6 Organizing the Business Enterprise (030312)
4. 7 Understanding Entrepreneurship and Small Business (100312)
5. 8 Managing Human Resources (240312)
6. 9 Understanding Employee Motivating, Satisfying & Leadership (310312)
7. 11 Understanding Marketing Processes and Consumer Behavior (140412)
8. 16 Managing Quality and Productivity (280412)
9. 17 Managing Information Systems and Communication Technology
10. 19 Understanding Money and Banking
11. 20 Intermediate Term and Lease Financing

4. FINAL PROJECT
 GENERATE REVENUE
 Proposal
 Timelines
 Sponsors
 Groups

5. 1. THE PRODUCTIVITY- QUALITY CONNECTION
2. TOTAL QUALITY MANAGEMENT
3. TOOLS FOR TQM
4. TRENDS IN PRODUCTIVITY AND QUALITY MANAGEMENT
5. PRODUCTIVITY AND QUALITY AS COMPETITIVE TOOLS

6. THE PRODUCTIVITY- QUALITY CONNECTION
 The more we can produce while using
fewer resources, the more productivity
grows and the more profitable
businesses are
 is measured as a ratio of outputs to
inputs
 Quality:
 A product’s fitness for use plus its success in
offering features that consumers want

7. PRODUCTIVITY CHALLENGE
 Quality declines, demand declines, profits
decline
 Country that improves its ability to make
something out of its existing resources can
increase the wealth of all its inhabitants
 Gross Domestic Product:
 Dollar value of all goods and services produced in
a country over a specified time period
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8. TOTAL QUALITY MANAGEMENT
 TQM:
 The sum of all activities involved in getting high
quality products into the market place
 Quality ownership:
 The principle of TQM that holds that quality belongs
to each person who creates it while performing a job
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9. TOOLS FOR TQM
• Process by which a company analyses a competitor’s products to
Competitive identify desirable improvements in its own
Product Analysis
• Process of evaluating all work activities, material flows and
Value-Added papers work to determine the value they add for customers
Analysis
• Methods for gathering data to analyze variations in production
activities to see when adjustments are needed
Statistical
process control • Process variations, Control charts
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10. TOOLS FOR TQM
• Method of improving quality by identifying current costs and areas with the greatest cost-saving
potential
Quality/ • Internal failures: costs incurred for correction of bad products while production and before they
Cost leave plant
studies • External failures: corrective costs, after bad product has left the plant
Quality • TQM tool in which groups of employees work together to improve quality
improvem
ent teams
• Process by which a company implements the best practices from its own
Benchmar
past performance and those of other companies to improve its own
king products
• The most successful companies keep close to their customers
Getting Closer
to Customer
and know what they want in the products they consumer
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11. ISO 9000:2000
 Program certifying that a company meets the
rigorous quality standards of the International
Organization for Standardization (ISO)
 To earn the rating firms are measured by qualified
consultants
 product testing
 employee training
 record-keeping
 correcting defects

12. ISO 14000
 certifies improvements in
environmental performance
 need an environmental management
system
 plan to improve resource use and manage
pollution
 covers practices in environmental labelling
 assesses total impact of firm’s products

13. Process Re-engineering
Radical redesign
of processes
to improve performance
dramatically

14. Supply Chain Management
 Supply chain = group of companies and stream of
activities involved in getting the product from raw
materials to end consumer.
 each stage adds value and depends on the others
 Supply chain management looks at the chain as a
whole to improve overall flow
 Improved coordination
 Enhanced communication
 Reduced inefficiencies
 Minimized costs