Total Quality in Organizations 20
3. Deming’s 14 points may be put into the six categories listed, but it should be realized that
some of his 14 points apply to more than one category.
a. Organizational purpose and mission: Points 1, 7, 9, and 14. These relate the need to
b. Quantitative goals: Points 3, 4, 8, 10, 11.a. & 11.b. These points may not be chosen
by everyone, but several have “hidden agendas” that relate to quantitative goals.
Inspection (point 3) is frequently used to develop quantitative goals and to “catch”
c. The revolution in management philosophy: Points 2, 7, and 14. These points are keys
to the change in management philosophy, but all 14 points really are needed to
d. Elimination of seat-of-the-pants decisions. Points 3, 4, 5, and perhaps 11. Seat-of-the-
pants decisions seem to flow from faulty logic and the short-term pressure to meet
4. A comparison of Deming’s “newer” version of the 14 Points versus the “original” 14
Points shows more of a “systems” emphasis. For a number of points, Deming shortened
and simplified them, perhaps to eliminate the obvious duplications, and perhaps to make
them easier to remember.
Total Quality in Organizations 21
1. Create a Vision and Demonstrate Commitment. Originally, in Deming’s earlier
version, commitment to aims and purposes of the organization by senior leaders was
3. Understand Inspection. In the old version, it appeared that Deming wanted to end
inspection (although a closer reading showed that he did not advocate ending all
5. Improve Constantly. This statement is a simplification of his old version of this point,
as are the points 6, 7, 8, 10, 12, 13, and 14. He seemed to be willing to let the
8. Drive Out Fear and Innovate. The new version of this point expands the emphasis to
include developing trust and innovation, which is an interesting confluence. Deming
9. Optimize the Efforts of Teams and Staff. This point has been broadened considerably
to imply that teamwork is the activity required to deploy and optimize the aims and
Total Quality in Organizations 22
5. Fear can become apparent in many ways in organizations. Workers will tend to do only
what they are told to do. They will be afraid to “stick their necks out.” Managers will be
the last to hear of a quality or production problem, because there is a tendency to “shoot
6. Deming’s philosophy can be applied to an academic environment, but only with
concerted efforts on the part of faculty, administrators, and students. Professors obviously
serve in a key role in transforming the classroom to a “total quality” environment. Unless
7. Deming’s classic example of the woman on the airplane is an illustration of sub–
optimization — optimizing goals of a sub-unit of an organization while undermining the
goals of the larger organization. It shows that the people in the Travel Department did not
understand the concept of the system in which they worked. Thus, the components of any
Total Quality in Organizations 23
8. Melissa’s job is to satisfy customers who are trying to obtain information or make
reservations, while she simultaneously attempts to satisfy her internal customers, the
supervisor and the account manager. Using Deming’s principles, her supervisor (and the
supervisor’s customer, the account manager) need to “adopt the new philosophy” of
9. Theory of knowledge is the branch of philosophy concerned with the nature and scope of
knowledge, its presuppositions and basis, and its general reliability of claims to
knowledge. In Deming’s system, this involves understanding the complete system and
10. See Review Question 3, above, for a discussion of how optimization relates to Profound
Knowledge from which to begin discussion. Answers will vary, depending on the
Total Quality in Organizations 24
11. Answers will vary, depending on the experiences of the student. See the answer to
Review questions 4, 8 and 11 for a frame of reference for this discussion.
12. The Quality Profiles in Chapter 1 and 2 for Motorola, Midway, USA, Texas Nameplate,
and Medrad all show consistent use of the quality management principles in Table 2.2.
Motorola cites respect for people and uncompromising integrity as it guiding values. This
Midway, USA is extremely customer focused, and shows it by having all salaried
employees (including senior leaders) spend one hour each week on the phone taking
orders and answering customer requests. Leaders are developed based on their approach
Medrad, Inc. is also known for its customer focus, fact-based decision-making, and
systematic approaches to process improvement. When applied to customer processes,
Medrad has systematically captured customers’ expectations and preferences through
various listening posts, trade associations, and other mechanisms and communicated
Total Quality in Organizations 25
14. Common causes of variation occur as a natural part of any process and are difficult to
change without making a major change in the system of which they are a part. Special
causes of variation arise from sources outside the system and can generally be traced
back to a specific change that has occurred and needs correction. For example, a process
15. In this chapter, statistical thinking is defined as a philosophy of learning and action based
on these principles:
1. All work occurs in a system of interconnected processes.
2. Variation exists in all processes.
3. Understanding and reducing variation are keys to success.
The student has learned to see her sewing work in the context of a system of
interconnected processes (material, thread, machine characteristics, and her own work in
16. In examining the ISO 9001 requirements of:
a. “The organization shall determine requirements specified by the customer”
b. “Records from management reviews shall be maintained.”
c. “. . .documentation shall include . . . documents needed . . . to ensure the effective
planning, operation and control of its processes. . .”
Total Quality in Organizations 26
d. “. . .shall determine the monitoring and measurement to be undertaken. . .to provide
evidence of conformity of product to determined requirements.”
e. “The quality management system. . .shall include a quality manual.”
SUGGESTIONS FOR PROJECTS, ETC.
1. This project is designed to allow students to determine for themselves if companies that
they are familiar with emphasize total quality. As can be seen from the Deere and
2. Students could use principles from Chapter 3 (see information on survey design) to
design the questionnaire and content from Deming’s 14 Points to perform this project.
3. This project is similar to project 1, above, except that students are asked to gather
4. This exercise is designed to expose students to the use of ISO 9000:2000 in
organizations. Students may find that managers perceive that ISO 9000:2000 is going to
ANSWERS TO CASE QUESTIONS
I. The Disciplinary Citation
Total Quality in Organizations 27
1. This case study shows Deming’s “Red Bead” Experiment in action. Drivers are being
2. A run chart (see C02DiscCase.xlsx for details) would appear to be a way to begin to
understand the process and to determine if it is in control or not. Based on the available
data, we have:
Center Line (average) for the chart = 280/40 = 7.0 mistakes
The data show that 15 drivers have exceeded the average. Also, 6 drivers had “no
defects”. A Pareto chart (in C02 DiscCase.xlsx, sheet 3) also shows that only 5 drivers
have 15 or more errors. The characteristics of drivers who are having difficulty should be
examined to explain their higher error rates. Are their errors far above normal, or just a
After corrections, a new chart (called a “c-chart” and discussed in Chapter xx) on the
stable process can be set up. Then those who consistently do well can be rewarded and
the performance of those who have an unsatisfactory level of errors can be improved.
II. Santa Cruz Guitar Company
25
Package Errors by Driver
Total Quality in Organizations 28
Based on the tour of Santa Cruz Guitar Company, it is easy to identify how the operations
and quality practices reflect Deming’s 14 points. Almost every point can be matched with
a specific practice followed by SCGC.
1. Create a Vision and Demonstrate Commitment. This principle is exemplified in the
small staff of 14 craftsmen, known as luthiers, who apply care and attention to detail
2. Learn the New Philosophy. Experienced luthiers, who are empowered to make their
own quality decisions, staff each station.
3. Understand Inspection. The manufacturing department inspects what it produces.
4. End Price Tag Decisions. This makes the simple statement, without prescribing how
this should be done. It seems obvious that SCGC does not “cut corners” when it
5. Improve Constantly. These opportunities for training and improvement (reference
points 10. 11. And 14, below) allow the craftsmen to explore new techniques in guitar
building and become familiar with the entire guitar building process.
6. & 7. Institute Training and Teach and Institute Leadership. Teamwork and mentoring
of new and seasoned luthiers show how training, teraching and leadership through
10. & 11. Eliminate Exhortations and Eliminate Quotas and MBO; Institute
Improvement; and Understand Processes. SCGC is a small-scale manufacturing
Total Quality in Organizations 29
12. Remove Barriers. SCGC workers are even encouraged to go out on their own to open
a luthier business someday.
13. Encourage Education. At SCGC, workers are encouraged to further enhance their
III. Walker Auto Sales and Service
1. Issues that Darren is encountering or may encounter include:
• Customer needs and performance standards are often difficult to identify and measure
in services, primarily because the customers define what they are and each customer
is different.
• The production of services usually requires a higher degree of customization, so
employees must tailor their services to individual customers
• The output of many service systems is intangible, so service quality can only be
2. Action plans that Darren might consider developing must tailor the systems to the needs
of various types of customers. He must ensure that he develops appropriate infrastructure,
practices and tools to support his vision. These might include:
Total Quality in Organizations 30
a. Customer relationship management
b. Leadership and strategic planning
For example, car buyers have different needs from those who are coming in for shop
service to their cars. For car buyers to be able to obtain a wide range of vehicles and
options to evaluate, have access to available salespeople, enjoy a prompt greeting, and
feel comfortable and un-pressured in reaching a buying decision, Darren must plan on
IV. Case – The Quarterly Sales Report
Obviously, Hagler has got to look beyond the quarterly sales reports to find out what is
really going on in his regions. Two simple scatter diagrams (see spreadsheet
C02Salecase.xls for details) that plot the entire 5 years of data, divided into large regions
and small regions, are very revealing. He might start with those graphs to see what the
general trend has been.
The Northeast, Southwest, and Northwest regions show basically flat sales for the 5 year
Total Quality in Organizations 31
To apply concepts of statistical thinking, Hagler must: 1) look at the big picture,
graphically, rather than at quarter to quarter variations, 2) find out what each region’s
See spreadsheet C02SaleCase for further analysis.
4000
4500
5000
Quarters
Large Regions’ Quarterly Data
0
1600
1Q –
08
2Q –
08
3Q –
08
4Q –
08
1Q –
09
2Q –
09
3Q –
09
4Q –
09
1Q –
10
2Q –
10
3Q –
10
4Q –
10
1Q –
11
2Q –
11
3Q –
11
4Q –
11
1Q –
12
2Q –
12
3Q –
12
4Q –
12
Quarters
Large Regions’ Quarterly Data – Without Sales Jump
Total Quality in Organizations 32
Instructor Reserve Materials
Quality in Practice – Kenneth W. Monfort College of Business
1. Monfort College of Business’ (MCB) mission and vision are stated as:
MCB’s Mission – Our mission is to deliver excellent undergraduate business programs
and related learning opportunities that prepare students for successful careers and
responsible leadership in business.
2. MCB’s philosophy of continuous improvement guides employee behavior and has been
key to attaining the mission and vision of the College. MCB’s commitment to an overall
organizational focus on continuous performance improvement and the significant
0
100
200
1Q
– 08
2Q
– 08
3Q
– 08
4Q
– 08
1Q
– 09
2Q
– 09
3Q
– 09
4Q
– 09
1Q
– 10
2Q
– 10
3Q
– 10
4Q
– 10
1Q
– 11
2Q
– 11
3Q
– 11
4Q
– 11
1Q
– 12
2Q
– 12
3Q
– 12
4Q
– 12
Sales ($000‘s)
Quarters
Small Regions’ Quarterly Sales
Total Quality in Organizations 33
program review and evaluation, and AACSB accreditation maintenance (which also
requires continuous improvement) are both strong external drivers. Internally, drivers
include the commitment of MCB leadership to performance improvement and a strategic
3. A visit to the Baldrige web site (www.nist.gov/baldrige) helps to identify several “best
practices” that MCB employs that might be useful to any college or university for
improving quality. Some of these are:
a. Clearly state mission, vision, and values focused (in the case of MCB) on
undergraduate education. Values are “spelled out” for each academic component of
instruction, scholarship, and service.
b. Combine hi-touch and wide-tech – small class sizes combined with technology
infrastructure. This provides for many opportunities for experiential learning, while
d. Build and maintain facilities that support and enhance the mission and vision of the
college. Up-to-date offices, classrooms, meeting spaces, auditorium, and dining
facilities are supported by technology infrastructure features such as computer labs,
electronic finance trading center, and a wi-fi system throughout the building.
e. Develop governance and administrative systems that meet or exceed local, state and
Quality in Practice – Toyota Motor Corporation, Ltd.
1. Toyota’s guiding principles include:
Total Quality in Organizations 34
1) Honor the language and spirit of the law of every nation and undertake open and fair
corporate activities to be a good corporate citizen of the world.
2) Respect the culture and customs of every nation and contribute to economic and
social development through corporate activities in the communities.
As stated in the chapter: “The TQ philosophy was based initially on three core principles:
customer focus, teamwork, and continuous improvement. ”
It’s interesting to note that Toyota’s Guiding Principles focus on being a socially
responsible, “world entity.” Customers and stakeholders are seen to be part of the society
in which they live. Five of the seven principles speak explicitly of a global mission.
Participation and teamwork is emphasized in Principles 2, 5, and 7.
The process focus and process improvement is not explicitly mentioned, but underlies
Principles 3, 4, and 6.
Toyota has shown itself to be capable of using total quality principles by establishing
consistent standards of excellence, setting and communicating clear expectations,
2. Just as SSM Health Care learned from manufacturing, other non-profit organizations
might also learn from Toyota. Their constancy of purpose and customer focus is
Total Quality in Organizations 35
exemplary. Their attention to detail and use of kaizen continuous improvement methods
Case – Child Focus, Inc.
1. Just as in any organization, profit or non-profit, it would be necessary to understand the
environment, the infrastructure, and the degree of commitment to building a quality
organization. I would want to ask:
• What support for quality do you have from your leadership team and board of
directors?
• How have your mission and vision been developed, and how do associates see their
impact on the organization?
• How does your continuous strategic and tactical planning system work, who is
The advice to be given to the CEO would depend heavily on the answers to the questions
above. For example, if she/he very knowledgeable about quality performance management
Case – Mercantile Stores
1. Mercantile views quality as part of their mission. Two aspects of this are to provide the
highest level of customer service and a broad assortment of fashionable high-quality,
high-value products. Information technology (Quick Response) was implemented to
Total Quality in Organizations 36
improve point-of-sale information needed by salespeople and inventory planning and
2. The emphasis in this case appears to be on internal quality, although a customer focus is
evident. Components of time, timeliness, consistency and accuracy are certainly
Case: Nightmare on Telecom Street
1. This experience seems all too familiar to most of us. The points of failure are: 1) the
number of phone rings before pickup; 2) possibly, the annoyance of having to deal with
an automated system, rather than a human operator; 3) use of overlapping categories at
the first two stages [What if you’re going with a company group? going to an
international conference?]; 3) long delays on hold; 4) asking for a card number that you
Case – Shiny Hills Farms
1. The case describes the quality assurance (QA) function of Shiny Hills Farms, which
seems to take a very traditional approach to “inspecting quality into” the product. The
activities include controlling product weight, appearance and shelf life of the product.
Total Quality in Organizations 37
2. The case narrative and the answer to Question 1 show that the QA department sees
quality as a “control” function. The TQ concept, with a high level of employee
3. Shiny Hill could improve its quality by focusing on both internal and external customer
needs, reducing reliance on inspection, implementing continuous improvement concepts,
Case: U.S. Water Resource Agency – Flagstaff District
1. Even though the Flagstaff District is a public, non-profit government agency, it still has
customers. These include virtually everyone in their geographic region who uses water.
Some specific examples are commercial and recreational users of the waterways, locks
2. The district might define quality in terms of meeting and exceeding customer
expectations. In many ways, they operate a service business similar to utilities, such as a
waterworks, gas and electric utility, etc. Their customers want to be able to use their
services with the assurance that they will be treated politely, by knowledgeable client
service people, with a minimum expenditure of time, using an easy–to-understand
WML/JRE-10-23-12