A PROJECT ON QUALITY MANAGEMENT AT CAPARO
SUBMITTED TO: ------------------------
SUBMITTED BY:
---------------------------------------
1
DECLARATION
I -------------- hereby declare that the project report titled “Quality Management at Caparo” Caparo” is my own work and has been carried out by me. All care has been
taken to keep this report error free and I sincerely regret for any unintended discrepancies that might have crept into this report. I shall be highly obliged if errors (if any) be brought to my attention.
-----------------------
2
DECLARATION
I -------------- hereby declare that the project report titled “Quality Management at Caparo” Caparo” is my own work and has been carried out by me. All care has been
taken to keep this report error free and I sincerely regret for any unintended discrepancies that might have crept into this report. I shall be highly obliged if errors (if any) be brought to my attention.
-----------------------
2
CERTIFICATE
I ------he ------hereby reby certify certify that that -------, -------, Student Student at-----at----------------------------- has completed completed the Project on “Quality Management at Caparo ”, under my guidance.
-----------------------
3
ACKNOWLEDGEMENT
I take this opportunity to express my deep sense of gratitude to all those who have contributed significantly by sharing their knowledge and experience in the completion of this project work. I am greatly obliged to ----------------------- for providing me the right kind of opportunity and facilities to complete this venture. My first word of gratitude is due to -----------, my industry guide, for her kind help and support and for his valuable guidance throughout the project.
Finally, I would also like to thank all my dear friends for their kind cooperation, advice and encouragement during the long and arduous task of preparing this report and carrying out the project work. At last but not the least, who are always at the top of my heart, my dear family members whose blessings, inspiration and encouragement have resulted in the successful completion of this project.
4
CONTENTS Page no. 1.
Introduction
2.
Research Methodology
6
10 3.
Characteristics of TQM.
4.
Fundamental Elements of TQM
13
5.
Classification of TQM
14
6.
Guideline to Improve Product Quality
31
7.
Dr W. Edward Deming's 14 Principles
39
8.
DMAIC Six Sigma approach
42
9.
Advantages of TQM
48
12
10.
Caparo at a glimpse
52
11.
Recommendations and suggestions
73
12.
Limitations of the study
74
13.
Bibliography
75
5
1.Introduction of Total Quality Management Although the concept of quality is very old, today it is perhaps the major preoccupation of organization world-wide. However, in the recent years, Total Quality Management (TQM) has captured the world-wide attention and is being adopted in many organizations, both profit & non-profit. TQM is being accepted as a management philosophy. Many organizations around the globe are conduction Organizational Development (OD) programmes to enhance quality awareness and change the attitudes of their employees. These efforts towards understandings, adopting and promoting TQM are primarily because of the changes taking place in the global economy, changing market conditions and customer’s expectations and increasing competitive pressure. Many large organizations have recognized the important contributions that TQM can make in dealing with these challenges. The objectives of this chapter it to trace the evolution of TQM as a general philosophy and a set of paradigms. Attempt is also made to discuss the significant contributions of various pioneering promoters of TQM philosophy towards the design, development and application of TQM systems. Various definitions and models of TQM are also outlined is this chapter to have a preliminary but fundamental grasp over the subject.
6
MEANING OF TQM TQM, thus, can be considered as being constituted of two composite elements namely Quality Management meaning that aspect of the overall function that determines and implements the quality policy ; and Quality Systems meaning the collective plans, activities and events that are provided to ensure that a product, Process or service will satisfy given needs. TQM
means many things to many organization. It has evolved itself to be
associated more often with statistical tools and process control, than with a method of management. In its essential sense, TQM is a means of operating a business that seeks to maximize an organization’s value through maximizing customer satisfaction at the lowest possible cost and is achieved by continuously improving all processes within the organization and collaborating with people.
Total Quality Management is thus based on the concepts and philosophies advocated by Juran, Deming, Crossby, and Feigenbaum. Conceptually, TQM emphasizes on: Top management commitment and support for quality improvement. Creating a production oriented total quality culture. Creating a Customer-oriented manufacturing environment. Improving participation and teamwork
7
Prevention of errors at source. Respect for humanity. Recongnition and reward for improvement efforts.
QUALITY DEFINED ‘Quality’ though familiar to everyone has a variety of uses and meanings. The classic perception of quality is the position of a product attitude on a good-bad scale. Most people associate it with defects in products. However, quality relates not only to the product but also to the instruction for its use, to installations, to service, to marketing and so on. Quality has been defined in various ways, Some of the important definitions of quality are presented below :
5.
its
1.
Quality is fitness for use (Juran, 1974).
2.
Quality is conformance to requirements (Crossby, 1984).
3.
Quality means The actual use and the selling price of the product (Feigenbaum, 1961).
4.
Quality is the capability composite of products or services to knowingly satisfy those preconceived composite wants of the user(s) that are intelligently related to the characteristics of performance, and do not cause major overt or convert reaction or actions by other people. (Johnson, 1987). The Totality of features and characteristics of products or services that bears on ability to satisfy given needs (ANSI & ASAC, 1978).
` Quality is, thus, both a user-oriented and a production-oriented expression. From the user’s point of view, quality is an expression of the products/services usefulness in meeting the needs and expectations and its reliability, safety, durability and so on. From the production point of view, the quality of a product is measured by the quality of its performance which depends on the quality of design and the quality of conformance. Quality of design is concerned with the stringency of the specifications for manufacturing the product. The quality of conformance is 8
concerned with how well the manufactured product conforms to the original requirements.
Different views of quality are held by marketing, engineering and manufacturing departments. Garvin (1988) outlines these as :
Transcendent – Qualtiy as a Simple analyzable property recognized only though experience.
Product based – Quality as a precise and measurable variable.
User based – ‘Quality lies in the eyes of the beholder’
Manufacturing based – Quality as conformance to the requirements.
Value based – Quality as performance or conformance at acceptable price or cost. Quality, therefore, is defined by the customers. a measure of achievement of customer satisfaction. fulfilling the customer’s needs/requirements. value for money. keeping one’s word. ensuring no defects. image of the company and customer confidence in the organisaton. a precise and measuring variable. utility to the society.
9
2.RESEARCH AND HYPOTHESIS/PROBLEM DEFINITION
In todays world the quality is most important thing for any body. Because its quality that makes the difference between each other. For managing the quality there are so many technique and tools has been developed. This is an step to understand and recommend the most active tools for quality management
1. OBJECTIVE OF RESEARCH PROJECT
I have undertaken the project quality mangement in order to learn and study the quality management technique. At the beginning of the century, social life was mostly local. It was followed by a period in which commodities were produced on a mass scale. There were no any tolls for quality checking most of the firm were competing each other on the basis of low price distribution. But now a days we cann’t get the work done only on the 10
basis of the Price. So the main objective of this project is to understand and analyse the implemenatation of the quality management technique at various organization
RESEARCH DESIGN
Research is the systematic and objective identification, collection, analysis, discrimination, and use of information for the purpose of improving decision making related to the identification and solution of problem with respect to marketing. 3. SAMPLING & DATA COLLECTION •
SAMPLING
A sample is a part of population from which the desired information is taken. The sample should be representative of the population and the information obtained must be reliable. In any survey where reliability is desired, the error and variances have to be controlled, measured and interpreted. Its not possible to analyse all the organization in india which has implementated the quality management technique at their organization that’s why a few company will be selected to analyse their quality management. •
DATA COLLECTION METHOD
11
1. Primary Sources: a questionnaire has been developed to know the management
thinking about quality management.
2. Secondary Data:
Secondary Data is collected from the web site and the company’s publication
3.CHARACTERISTICS OF TQM: The Characteristics of TQM, as revealed from the above definitions and models are as follows:
1. TQM is customer oriented.
2. TQM requires a long term commitment for continuous improvement of all processes.
3. The success of TQM demands the leadership of top management and continuous involvement.
4. Responsibility for establishment and improvement of system lies with the management of an organisation.
12
5. TQM is a strategy for continuously improving performance at all levels and in all areas of responsibility.
4.FOLLOWING AS THE FOUNDATIONAL ELEMENTS OF TQM.
1.
People: TQM aims at empowering people so as to accomplish optimal business
results through teamwork. This involves training that focusses on communication skills, interactive skills and effective meeting skills. Such training enables people to be actively involved in the continuous improvement of products and processes and leads to improved teamwork.
2.
Continuous improvement: It involves the fundamental principle of quality, the
Daming cycle and th4e PDCA (Plan, Do, Check, Action) cycle. The iteration of cycle is the never ending pursuit of excellence.
13
3.
Process : The use of problem solving process as a guide to analyze a problem,
choose a solution, develop an action plan and evaluate implementation results ; and the use of quality improvement process for reducing customer requirements to a specification and specification to a defined work process so as to focus attention on the customer and customer requirements. 4.
Customer: TQM’s primary focus is the customer and customer satisfaction.
Customer perceptions of quality that correlates with customer’s satisfaction are expected quality, satisfying quality, delightful quality, indifferent quality and reverse quality. These must be aimed at to prevent customer dissatisfaction, to meet customers’ expectations and delighted them.
5.CLASSIFICATION OF TOTAL QUALITY MANAGEMNT Quality management evolution
Quality management is not a recent phenomenon. Advanced civilizations that supported the arts and crafts allowed clients to choose goods meeting higher quality standards than normal goods. In societies where art and craft (and craftsmanship) were valued, one of the responsibilities of a master craftsman (and similarly for artists) was to lead their studio, train and supervise the work of their craftsmen and apprentices. The master craftsman set standards, reviewed the work of others and ordered rework and revision as necessary. One of the limitations of the craft approach was that relatively few goods could be produced, on the other hand an advantage was that each item produced could be individually shaped to suit the client. This craft based approach to quality and the practices used were major inputs when quality management was created as a management science.
14
During the industrial revolution, the importance of craftsmen was diminished as mass production and repetitive work practices were instituted. The aim was to produce large numbers of the same goods. The first proponent in the US for this approach was Eli Whitney who proposed (interchangeable) parts manufacture for muskets, hence producing the identical components and creating a musket assembly line. The next step forward was promoted by several people including Frederick Winslow Taylor a mechanical engineer who sought to improve industrial efficiency. He is sometimes called "the father of scientific management." He was one of the intellectual leaders of the Efficiency Movement and part of his approach laid a further foundation for quality management, including aspects like standardization and adopting improved practices. Henry Ford also was important in bringing process and quality management practices into operation in his assembly lines. In Germany, Karl Friedrich Benz, often called the inventor of the motor car, was pursuing similar assembly and production practices, although real mass production was properly initiated in Volkswagen after world war two. From this period onwards, north American companies focused predominantly upon production against lower cost with increased efficiency. Walter A. Shewhart made a major step in the evolution towards quality management by creating a method for quality control for production, using statistical methods, first proposed in 1924. This became the foundation for his ongoing work on statistical quality control. W. Edwards Deming later applied statistical process control methods in the United States during World War II, thereby successfully improving quality in the manufacture of munitions and other strategically important products. Quality leadership from a national perspective has changed over the past five to six decades. After the second world war, Japan decided to make quality improvement a national imperative as part of rebuilding their economy, and sought the help of Shewhart, Deming and Juran, amongst others. W. Edwards Deming championed 15
Shewhart's ideas in Japan from 1950 onwards. He is probably best known for his management philosophy establishing quality, productivity, and competitive position. He has formulated 14 points of attention for managers, which are a high level abstraction of many of his deep insights. They should be interpreted by learning and understanding the deeper insights and include: •
Break down barriers between departments
•
Management should learn their responsibilities, and take on leadership
•
Improve constantly
•
Institute a programme of education and self-improvement
In the 1950s and 1960s, Japanese goods were synonymous with cheapness and low quality, but over time their quality initiatives began to be successful, with Japan achieving very high levels of quality in products from the 1970s onward. For example, Japanese cars regularly top the J.D. Power customer satisfaction ratings. In the 1980s Deming was asked by Ford Motor Company to start a quality initiative after they realized that they were falling behind Japanese manufacturers. A number of highly successful quality initiatives have been invented by the Japanese (see for example on this page: Taguchi, QFD, Toyota Production System. Many of the methods not only provide techniques but also have associated quality culture aspects (i.e. people factors). These methods are now adopted by the same western countries that decades earlier derided Japanese methods. Customers recognize that quality is an important attribute in products and services. Suppliers recognize that quality can be an important differentiator between their own offerings and those of competitors (quality differentiation is also called the quality gap). In the past two decades this quality gap has been greatly reduced between competitive products and services. This is partly due to the contracting (also called outsourcing) of 16
manufacture to countries like India and China, as well internationalization of trade and competition. These countries amongst many others have raised their own standards of quality in order to meet International standards and customer demands. The ISO 9000 series of standards are probably the best known International standards for quality management. There are a huge number of books available on quality. In recent times some themes have become more significant including quality culture, the importance of knowledge management, and the role of leadership in promoting and achieving high quality. Disciplines like systems thinking are bringing more holistic approaches to quality so that people, process and products are considered together rather than independent factors in quality management. Quality improvement
There are many methods for quality improvement. These cover product improvement, process improvement and people based improvement. In the following list are methods of quality management and techniques that incorporate and drive quality improvement — 1.
ISO 9004:2000 — Guidelines for performance improvement.
2.
ISO 15504-4: 2005 — Information technology — Process assessment — Part 4: Guidance on use for process improvement and process capability determination.
3.
QFD — Quality Function Deployment, also known as the House of Quality approach.
4.
Kaizen — 改 善 , Japanese for change for the better; the common English usage is continual improvement. 17
5.
Zero Defect Program — created by NEC Corporation of Japan, based upon Statistical Process Control and one of the inputs for the inventors of Six Sigma.
6.
Six Sigma — 6σ, Six Sigma combines established methods such as Statistical Process Control, Design of Experiments and FMEA in an overall framework.
7.
PDCA — Plan, Do, Check, Act cycle for quality control purposes. (Six Sigma's DMAIC method (Design, Measure, Analyze, Improve, Control) may be viewed as a particular implementation of this.)
8.
Quality circle — a group (people oriented) approach to improvement.
9.
Taguchi methods — statistical oriented methods including Quality robustness, Quality loss function and Target specifications.
10.
The Toyota Production System — reworked in the west into Lean Manufacturing.
11.
Kansei Engineering — an approach that focuses on capturing customer emotional feedback about products to drive improvement.
12.
TQM — Total Quality Management is a management strategy aimed at embedding awareness of quality in all organizational processes. First promoted in Japan with the Deming prize which was adopted and adapted in USA as the Malcolm Baldrige National Quality Award and in Europe as the European Foundation for Quality Management award (each with their own variations).
13.
TRIZ — meaning "Theory of inventive problem solving"
14.
BPR — Business process reengineering, a management approach aiming at 'clean slate' improvements (That is, ignoring existing practices).
Proponents of each approach have sought to improve them as well as apply them to enterprise types not originally targeted. For example, Six Sigma was designed for
18
manufacturing but has spread to service enterprises. Each of these approaches and methods has met with success but also with failures. Some of the common differentiators between success and failure include commitment, knowledge and expertise to guide improvement, scope of change/improvement desired (Big Bang type changes tend to fail more often compared to smaller changes) and adaption to enterprise cultures. For example, quality circles do not work well in every enterprise (and are even discouraged by some managers), and relatively few TQM participating enterprises have won the national quality awards. There has been well publicized failures of BPR, as well as Six Sigma. Enterprises therefore need to consider carefully which quality improvement methods to adopt, and certainly should not adopt all those listed here. It is important not to underestimate the people factors, such as culture, in selecting a quality improvement approach. Any improvement (change) takes time to implement, gain acceptance and stabilize as accepted practice. Improvement must allow pauses between implementing new changes so that the change is stabilized and assessed as a real improvement, before the next improvement is made (hence continual improvement, not continuous improvement). Improvements that change the culture take longer as they have to overcome greater resistance to change. It is easier and often more effective to work within the existing cultural boundaries and make small improvements (that is Kaizen) than to make major transformational changes. Use of Kaizen in Japan was a major reason for the creation of Japanese industrial and economic strength. On the other hand, transformational change works best when an enterprise faces a crisis and needs to make major changes in order to survive. In Japan, the land of Kaizen, 19
Carlos Ghosn led a transformational change at Nissan Motor Company which was in a financial and operational crisis. Well organized quality improvement programs take all these factors into account when selecting the quality improvement methods. Quality standards
The International Organization for Standardization (ISO) created the Quality Management System (QMS) standards in 1987. These were the ISO 9000:1987 series of standards comprising ISO 9001:1987, ISO 9002:1987 and ISO 9003:1987; which were applicable in different types of industries, based on the type of activity or process: designing, production or service delivery. The standards have been regularly reviewed every few years by the International Organization for Standardization. The version in 1994 and was called the ISO 9000:1994 series; comprising of the ISO 9001:1994, 9002:1994 and 9003:1994 versions. The last revision was in the year 2000 and the series was called ISO 9000:2000 series. However the ISO 9002 and 9003 standards were integrated and one single certifiable standard was created under ISO 9001:2000. Since December 2003, ISO 9002 and 9003 standards are not valid, and the organizations previously holding these standards need to do a transition from the old to the new standards. The ISO 9004:2000 document gives guidelines for performance improvement over and above the basic standard (ISO 9001:2000). This standard provides a measurement framework for improved quality management, similar to and based upon the measurement framework for process assessment.
20
The Quality Management System standards created by ISO are meant to certify the processes and the system of an organization and not the product or service itself. ISO 9000 standards do not certify the quality of the product or service. Recently the International Organization for Standardization released a new standard, ISO 22000, meant for the food industry. This standard covers the values and principles of ISO 9000 and the HACCP standards. It gives one single integrated standard for the food industry and is expected to become more popular in the coming years in such industry. ISO has a number of standards that support quality management. One group describes processes (including ISO 12207 & ISO 15288) and another describes process assessment and improvement ISO 15504. The Software Engineering Institute has its own process assessment and improvement methods, called CMMi (Capability Maturity Model — integrated) and IDEAL respectively. Business benefits of ISO 14000
This section identifies typical benefits for organizations of implementing ISO 14000 standards. Most managers will try to avoid pollution that could cost the company a fine for infringing environmental legislation. But better managers will agree that doing only just enough to keep the company out of trouble with government inspectors is a rather weak and reactive approach to business in today's environment-conscious world . The ISO 14000 standards are practical tools for the manager who is not satisfied with mere compliance with legislation – which may be perceived as a cost of doing business. 21
They are for the proactive manager with the vision to understand that implementing a strategic approach can bring return on investment in environment-related measures. The systematic ISO 14001:2004 approach requires the organization to take a hard look at all areas where its activities have an environmental impact . And it can lead to benefits like the following:
reduced cost of waste management
savings in consumption of energy and materials
lower distribution costs
improved corporate image among regulators, customers and the public
framework for continual improvement of environmental performance.
The manager who is "too busy managing the business" to listen to good sense about environmental management could actually be costing the business, instead of achieving benefits like those above. Certification (i)
Certification is not a requirement of any of ISO's management system standards. This section provides a basic understanding of what certification and related terms mean.
(b)
Certification, registration and accreditation In the context of ISO 9001:2000 or ISO 14001:2004, “ certification” refers to the issuing of written assurance (the certificate) by an independent external body that it has audited a management system and verified that it conforms to the requirements specified in the standard.
22
“Registration” means that the auditing body then records the certification in its client
register. So, the organization’s management system has been both certified and registered. Therefore, in the ISO 9001:2000 or ISO 14001:2004 context, the difference between the two terms is not significant and both are acceptable for general use. “Certification” is the term most widely used worldwide, although registration is often preferred in North America, and the two are used interchangeably.
On the contrary, using “accreditation” as an interchangeable alternative for certification or registration is a mistake, because it means something different. In the ISO 9001:2000 or ISO 14001:2004 context, accreditation refers to the formal recognition by a specialized body – an accreditation body – that a certification body is competent to carry out ISO 9001:2000 or ISO 14001:2004 certification in specified
business sectors. In simple terms, accreditation is like certification of the certification body. Certificates issued by accredited certification bodies may be perceived on the market as having increased credibility. Quality terms •
Quality Improvement can be distinguished from Quality Control in that Quality Improvement is the purposeful change of a process to improve the reliability of achieving an outcome.
•
Quality Control is the ongoing effort to maintain the integrity of a process to maintain the reliability of achieving an outcome.
23
•
Quality Assurance is the planned or systematic actions necessary to provide enough confidence that a product or service will satisfy the given requirements for quality.
Implementation of Total Quality Management (TQM)
Total Quality Management is a management approach that originated in the 1950's and has steadily become more popular since the early 1980's. Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with processes being done right the first time and defects and waste eradicated from operations. Total Quality Management, TQM, is a method by which management and employees can become involved in the continuous improvement of the production of goods and services. It is a combination of quality and management tools aimed at increasing business and reducing losses due to wasteful practices. Some of the companies who have implemented TQM include Ford Motor Company, Phillips Semiconductor, SGL Carbon, Motorola and Toyota Motor Company.
The Concept of Continuous Improvement by TQM 24
TQM is mainly concerned with continuous improvement in all work, from high level strategic planning and decision-making, to detailed execution of work elements on the shop floor. It stems from the belief that mistakes can be avoided and defects can be prevented. It leads to continuously improving results, in all aspects of work, as a result of continuously improving capabilities, people, processes, technology and machine capabilities. Continuous improvement must deal not only with improving results, but more importantly with improving capabilities to produce better results in the future. The five major areas of focus for capability improvement are demand generation, supply generation, technology, operations and people capability. A central principle of TQM is that mistakes may be made by people, but most of them are caused, or at least permitted, by faulty systems and processes. This means that the root cause of such mistakes can be identified and eliminated, and repetition can be prevented by changing the process. 1 There are three major mechanisms of prevention: 1.
Preventing mistakes (defects) from occurring (Mistake - proofing or Poka-Yoke).
2.
Where mistakes can't be absolutely prevented, detecting them early to prevent them being passed down the value added chain (Inspection at source or by the next operation).
3.
Where mistakes recur, stopping production until the process can be corrected, to prevent the production of more defects. (Stop in time).
25
Implementation Principles and Processes
A preliminary step in TQM implementation is to assess the organization's current reality. Relevant preconditions have to do with the organization's history, its current needs, precipitating events leading to TQM, and the existing employee quality of working life. If the current reality does not include important preconditions, TQM implementation should be delayed until the organization is in a state in which TQM is likely to succeed. If an organization has a track record of effective responsiveness to the environment, and if it has been able to successfully change the way it operates when needed, TQM will be easier to implement. If an organization has been historically reactive and has no skill at improving its operating systems, there will be both employee skepticism and a lack of skilled change agents. If this condition prevails, a comprehensive program of management and leadership development may be instituted. A management audit is a good assessment tool to identify current levels of organizational functioning and areas in need of change. An organization should be basically healthy before beginning TQM. If it has significant problems such as a very unstable funding base, weak administrative systems, lack of managerial skill, or poor employee morale, TQM would not be appropriate.5 However, a certain level of stress is probably desirable to initiate TQM. People need to feel a need for a change. Kanter (1983) addresses this phenomenon be describing building blocks which are present in effective organizational change. These forces include departures from tradition, a crisis or galvanizing event, strategic decisions, 26
individual "prime movers," and action vehicles. Departures from tradition are activities, usually at lower levels of the organization, which occur when entrepreneurs move outside the normal ways of operating to solve a problem. A crisis, if it is not too disabling, can also help create a sense of urgency which can mobilize people to act. In the case of TQM, this may be a funding cut or threat, or demands from consumers or other stakeholders for improved quality of service. After a crisis, a leader may intervene strategically by articulating a new vision of the future to help the organization deal with it. A plan to implement TQM may be such a strategic decision. Such a leader may then become a prime mover, who takes charge in championing the new idea and showing others how it will help them get where they want to go. Finally, action vehicles are needed and mechanisms or structures to enable the change to occur and become institutionalized.
Process Oriented Management V/S Result Oriented Management:
“Let’s consider this,” said the professor. “How is Process Oriented Management (PROM) different from Result Oriented Management (ROM)? Is it that in Process Oriented Management, you don’t bother about the result? No. That is not the case.
Process oriented management is based on the paradigm (mindset) that the result is the effect of a number of causes, If we concentrate on the causes an ensure that the causes operate exactly as the way we want to, the result is bound to happen (barring a random element that is uncontrollable by its very nature, such as major earthquake.) Since results are bound to happen when the causes are perfected, Process Oriented 27
Management recommends that we stop worrying about the result. (Incidentally, the philosophy of ‘karmanye wadhikaraste ma phaleshu kadachana” implies the same thing; concentrate on perfecting the causes in the process and the result is bound to come since the result is bouondto be achieved, we can therefore, forget about it. This philosophy is often misunderstood as ‘keep working without caring for the result’) Process oriented management is deeply concerned about the result. An analogy might help. A student is told “Get good marks, I don’t care how.” What kind of management is it” Is it good?
Another student is told, “You must get the marks, so find out the correct way to study, and study with regularity and diligence.” Would this policy work? Which kind of management would you like to use in your organization? Western management has gone too far with result oriented management; managers find that they have to produce result by hook or by crook. Naturally they find that producing result is a marathon exercise every time.
In Process Oriented Management, you first study the process.
What is the difference between a process and an operation?
A Process is summation of activities such as operations, inspections, delays, storage, transports, and every thing else that happens between the beginning and the end of the process. In contrast, an Operation does not include inspection, delays an all the 28
other aspects. There are two types operations: ‘Do’ and ‘Make ready’. For instance, warming up an electric iron till it reaches the desired temperature is a ‘make ready’ operation, while ‘ironing’ is a ‘do’ operation.
There are tow types of activities: Value Adding Activities (VA) and Non Value Adding Activities (NVA).
By definition, Value Adding Activities are those that add value to product as seen from the customer’s point of view. All others are Non Value Adding activities. Even ‘make ready’ operations are NVA’s.
Process oriented management first classifies all activities performed as VA or NVA and attacks Non Value Adding activities first! This is because if you conduct actual studies on any process, you are most likely to find that the amount of time spent of Non Value Adding activities exceeds the amount of time spent of Value Adding activities.
Typically, result oriented management attacks Value Adding activities and tries to make them more efficient in the belief that it is only the VA activities that 29
matter. They often end up making VA more efficient and losing more than what was gained because the NVA, that were ignored, increased enormously.
Many companies have increased production rate; simultaneously increasing inventories (storage, delays and transports). They often find that the bottom line does not improve; though the production rate has increase. They can’t understand why. Now, having learned about process oriented management, we can understand the reason”.
We should first have a clear understanding of the entire process in terms of all those activities, which are ‘Value Adding’ and ‘Non Value Adding’. Normally the NVA activities are much more in number and the time taken for the NVA activities is also very large as compared to the VA activities.
The NVA activities should be eliminated be eliminated or mad efficient in terms of time taken, till they become equivalent to the VA activities in terms of time taken. Now, both the VA and NVA activities should be simultaneously considered for improvement. 30
6.GUIDELINES TO BE FOLLOW TO IMPROVE QUALITY OF PRODUCT. This document introduces the eight quality management principles on which the quality management system standards of the revised ISO 9000:2000 series are based. These principles can be used by senior management as a framework to guide their organizations towards improved performance. The principles are derived from the collective experience and knowledge of the international experts who participate in ISO Technical Committee ISO/TC 176, Quality management and quality assurance , which is responsible for developing and maintaining the ISO 9000 standards. The eight quality management principles are defined in ISO 9000:2000, Quality management systems Fundamentals and vocabulary , and in ISO 9004:2000, Quality management systems Guidelines for performance improvements.
This document gives the standardized descriptions of the principles as they appear in ISO 9000:2000 and ISO 9004:2000. In addition, it provides examples of the benefits derived from their use and of actions that managers typically take in applying the principles to improve their organizations' performance. 31
Principle 1: Customer focus Organizations depend on their customers and therefore should understand current and future customer needs, should meet customer requirements and strive to exceed customer expectations. Key benefits:
Increased revenue and market share obtained through flexible and fast responses to
Increased effectiveness in the use of the organization's resources to enhance customer
market opportunities.
satisfaction.
Improved customer loyalty leading to repeat business.
Applying the principle of customer focus typically leads to :
Researching and understanding customer needs and expectations.
Ensuring that the objectives of the organization are linked to customer needs and
expectations.
Communicating
customer
needs
and
expectations
throughout
the
organization.
Measuring customer satisfaction and acting on the results.
Systematically managing customer relationships.
Ensuring a balanced approach between satisfying customers and other interested parties (such as owners, employees, suppliers, financiers, local communities and society as a whole).
32
Principle 2: Leadership Leaders establish unity of purpose and direction of the organization. They should create and maintain the internal environment in which people can become fully involved in achieving the organization's objectives. Key benefits:
People will understand and be motivated towards the organization's goals
and objectives.
Activities are evaluated, aligned and implemented in a unified way.
Miscommunication between levels of an organization will be minimized.
Applying the principle of leadership typically leads to :
Considering the needs of all interested parties including customers, owners,
employees,
suppliers, financiers, local communities and society as a whole.
Establishing a clear vision of the organization's future.
Setting challenging goals and targets.
Creating and sustaining shared values, fairness and ethical role models at all
levels of the
organization.
Establishing trust and eliminating fear.
Providing people with the required resources, training and freedom to act
with
responsibility and accountability.
Inspiring, encouraging and recognizing people's contributions.
33
Principle 3: Involvement of people People at all levels are the essence of an organization and their full involvement enables their abilities to be used for the organization's benefit. Key benefits:
Motivated, committed and involved people within the organization.
Innovation and creativity in furthering the organization's objectives.
People being accountable for their own performance.
People eager to participate in and contribute to continual improvement.
Applying the principle of involvement of people typically leads to:
People understanding the importance of their contribution and role in the organization.
People identifying constraints to their performance.
People accepting ownership of problems and their responsibility for solving them.
People evaluating their performance against their personal goals and objectives.
People actively seeking opportunities to enhance their competence, knowledge and
experience.
People freely sharing knowledge and experience.
People openly discussing problems and issues.
34
Principle 4: Process approach A desired result is achieved more efficiently when activities and related resources are managed as a process.
Key benefits:
Lower costs and shorter cycle times through effective use of resources.
Improved, consistent and predictable results.
Focused and prioritized improvement opportunities.
Applying the principle of process approach typically leads to:
Systematically defining the activities necessary to obtain a desired result.
Establishing clear responsibility and accountability for managing key activities.
Analysing and measuring of the capability of key activities.
Identifying the interfaces of key activities within and between the functions of the organization.
Focusing on the factors such as resources, methods, and materials that will improve keyactivities of the organization.
Evaluating risks, consequences and impacts of activities on customers, suppliers and
other interested parties.
Principle 5: System approach to management Identifying, understanding and managing interrelated processes as a system contributes to the organization's effectiveness and efficiency in achieving its objectives.
35
Key benefits:
Integration and alignment of the processes that will best achieve the desired results.
Ability to focus effort on the key processes.
Providing confidence to interested parties as to the consistency, effectiveness and efficiency of the organization.
Applying the principle of system approach to management typically leads to:
Structuring a system to achieve the organization's objectives in the most effective and
efficient way.
Understanding the interdependencies between the processes of the system.
Structured approaches that harmonize and integrate processes.
Providing a better understanding of the roles and responsibilities necessary for achieving
common
objectives
and
thereby
reducing
cross-
functional barriers.
Understanding
organizational
capabilities
and
establishing
resource
constraints prior to action.
Targeting and defining how specific activities within a system should operate.
Continually improving the system through measurement and evaluation.
Principle 6: Continual improvement Continual improvement of the organization's overall performance should be a permanent objective of the organization. Key benefits: 36
Performance advantage through improved organizational capabilities.
Alignm Alignment ent of improv improveme ement nt activi activitie tiess at all levels levels to an organi organizat zation ion's 's strategic intent.
Flexibility to react quickly to opportunities.
Applying the principle of continual improvement typically leads to:
Empl Employ oyin ing g
a
cons consis iste tent nt
improvement of of th the
orga organi niza zati tion on-w -wid idee
appr approa oach ch
to
cont contin inua uall
organization's pe performance.
Prov Provid idin ing g peop people le with with trai traini ning ng in the the meth method odss and and tool toolss of cont contin inua uall improvement.
Making Making contin continual ual improv improveme ement nt of produc products, ts, proce processe ssess and system systemss an objective for every every individual in the organization. organization.
Establishing goals to guide, and measures to track, continual improvement.
Recognizing and acknowledging improvements.
Principle 7: Factual approach to decision making Effective decisions are based on the analysis of data and information Key benefits:
Informed decisions.
An increa increased sed abilit ability y to demons demonstra trate te the effect effective ivenes nesss of past past decisi decisions ons throug through h refere reference nce to factua factuall records records..
Increased ability to review, challenge and change opinions and decisions.
Applying the principle of factual approach to decision making typically leads to: 37
Ensuring that data and information are sufficiently accurate and reliable.
Making data accessible to those who need it.
Analysing data and information using valid methods.
Making decisions and taking action based on factual analysis, balanced with expe experi rien ence ce and and intu intuit itio ion. n.
Principle 8: Mutually beneficial b eneficial supplier relationships An organization and its suppliers are interdependent and a mutually beneficial relationship enhances the ability of both to create value Key benefits:
Increased ability to create value for both parties.
Flexibility and speed of joint responses to changing market or customer needs an and
expectations.
Optimization of costs and resources.
Applyin Applying g the princi principle pless of mutuall mutually y benefic beneficial ial suppli supplier er relati relations onship hipss typica typically lly leads to:
Establ Establish ishing ing relat relation ionshi ships ps that that balanc balancee shortshort-ter term m gains gains with with long-t long-term erm considerations.
Pooling of expertise and resources with partners.
Identifying and selecting key suppliers.
Clear and open communication.
Sharing information and future plans.
Establishing joint development and improvement activities. 38
Inspiring, encouraging and recognizing improvements and achievements by suppliers.
7.Dr W. Edward Deming's 14 Principles
1.
Constancy of purpose: Create constancy of purpose for continual improvement of
products and service to society, allocating resources to provide for long range needs rather than only short term profitability, with a plan to become competitive, to stay in business, and to provide jobs. 2.
The new philosophy: Adopt the new philosophy. We are in a new economic age,
created in Japan. We can no longer live with commonly accepted levels of delays, mistak mistakes, es, defect defective ive materi materials als and defect defective ive workma workmansh nship. ip. Transf Transform ormati ation on of Western management style is necessary to halt the continued decline of business and industry. 3.
Cease dependence on mass inspection: Eliminate the need for mass inspection as
the way of life to achieve quality by building quality into the product in the first
39
place. Require statistical evidence of built in quality in both manufacturing and purchasing functions. 4.
End lowest tender contracts: End the practice of awarding business solely on the
basis of price tag. Instead require meaningful measures of quality along with price. Reduce the number of suppliers for the same item by eliminating those that do not qualify with statistical and other evidence of quality. The aim is to minimize total cost, not merely initial cost, by minimizing variation. This may be achieved by moving toward a single supplier for any one item, on a long term relationship of loyalty and trust. Purchasing managers have a new job, and must learn it. 5.
Improve every process: Improve constantly and forever every process for
planning, production, and service. Search continually for problems in order to improve every activity in the company, to improve quality and productivity, and thus to constantly decrease costs. Institute innovation and constant improvement of product, service, and process. It is management's job to work continually on the system (design, incoming materials, maintenance, improvement of machines, supervision, training, retraining). 6.
Institute training on the job: Institute modern methods of training on the job for
all, including management, to make better use of every employee. New skills are required to keep up with changes in materials, methods, product and service design, machinery, techniques, and service. 7.
Institute leadership: Adopt and institute leadership aimed at helping people do a
better job. The responsibility of managers and supervisors must be changed from sheer numbers to quality. Improvement of quality will automatically improve productivity. Management must ensure that immediate action is taken on reports of inherited defects, maintenance requirements, poor tools, fuzzy operational definitions, and all conditions detrimental to quality. 40
8.
Drive out fear: Encourage effective two way communication and other means to
drive out fear throughout the organization so that everybody may work effectively and more productively for the company. 9.
Break down barriers: Break down barriers between departments and staff areas.
People in different areas, such as Leasing, Maintenance, Administration, must work in teams to tackle problems that may be encountered with products or service. 10.
Eliminate exhortations: Eliminate the use of slogans, posters and exhortations for
the work force, demanding Zero Defects and new levels of productivity, without providing methods. Such exhortations only create adversarial relationships; the bulk of the causes of low quality and low productivity belong to the system, and thus lie beyond the power of the work force. 11.
Eliminate arbitrary numerical targets: Eliminate work standards that prescribe
quotas for the work force and numerical goals for people in management. Substitute aids and helpful leadership in order to achieve continual improvement of quality and productivity. 12.
Permit pride of workmanship: Remove the barriers that rob hourly workers, and
people in management, of their right to pride of workmanship. This implies, among other things, abolition of the annual merit rating (appraisal of performance) and of Management by Objective. Again, the responsibility of managers, supervisors, foremen must be changed from sheer numbers to quality. 13.
Encourage education: Institute a vigorous program of education, and encourage
self improvement for everyone. What an organization needs is not just good people; it needs people that are improving with education. Advances in competitive position will have their roots in knowledge. 41
14.
Top management commitment and action: Clearly define top management's
permanent commitment to ever improving quality and productivity, and their obligation to implement all of these principles. Indeed, it is not enough that top management commit themselves for life to quality and productivity. They must know what it is that they are committed to-that is, what they must do. Create a structure in top management that will push every day on the preceding 13 Points, and take action in order to accomplish the transformation. Support is not enough: action is required!
8.DMAIC six sigma approach.
The six sigma approach for projects is DMAIC (define, measure, analyze, improve and control). These steps are the most common six sigma approach to project work. Some organizations omit the D in DMAIC because it is really management work. With the D dropped from DMAIC the Black Belt is charged with MAIC only in that six sigma approach.
We believe define is too important be left out and sometimes
management does not do an adequate job of defining a project. Our six sigma approach is the full DMAIC. Define (DMAIC).
42
Define is the first step in our six sigma approach of DMAIC. DMAIC first asks leaders to define our core processes. It is important to define the selected project scope, expectations, resources and timelines. The definition step in the six sigma approach identifies specifically what is part of the project and what is not, and explains the scope of the project. Many times the first passes at process documentation are at a general level. Additional work is often required to adequately understand and correctly document the processes. As the saying goes “The devil is in the details.” Measure (DMAIC).
Many think when they start a journey the most important thing to know is where they are going. While we agree knowing where you want to go is very important, we believe some of the first information you need before starting any journey is your current location. The six sigma approach asks the Black Belt project manager to quantify and benchmark the process using actual data. At a minimum consider the mean or average performance and some estimate of the dispersion or variation (maybe even calculate the standard deviation). Trends and cycles can also be very revealing. The two data points and extrapolate to infinity is not a six sigma approach. Process capabilities can be calculated once there is performance data, Analyze (DMAIC).
Once the project is understood and the baseline performance documented and verified that there is real opportunity, it is time with the six sigma approach to do an analysis of the process. In this step, the six sigma approach applies statistical tools to validate root causes of problems.
Any number of tools and tests can be used. The objective is to
understand the process at a level sufficient to be able to formulate options for improvement. We should be able to compare the various options with each other to 43
determine the most promising alternatives. As with many activities, balance must be achieved. Superficial analysis and understanding will lead to unproductive options being selected, forcing recycle through the process to make improvements. At the other extreme is the paralysis of analysis. Striking the appropriate balance is what makes the six sigma Black Belt highly valuable. Improve (DMAIC).
During the improve step of the six sigma approach ideas and solutions are put to work. The six sigma Black Belt has discovered and validated all known root causes for the existing opportunity. The six sigma approach requires Black Belts to identify solutions. Few ideas or opportunities are so good that all are an instant success. As part of the six sigma approach there must be checks to assure that the desired results are being achieved. Some experiments and trials may be required in order to find the best solution. When making trials and experiments it is important that all project associates understand that these are trials and really are part of the six sigma approach. Control (DMAIC)
Many people believe the best performance you can ever get from a process is at the very beginning. Over time there is an expectancy that slowly things will get a little worse until finally it is time for another major effort towards improvement. Contrasted with this is the Kaizen approach that seeks to make everything incrementally better on a continuous basis. The sum of all these incremental improvements can be quite large. As part of the six sigma approach performance tracking mechanisms and measurements are in place to assure, at a minimum, that the gains made in the project are not lost over a period of time. As part of the control step we encourage sharing with others in the organization. With this the six sigma approach really starts to create phenomenal 44
returns, ideas and projects in one part of the organization are translated in a very rapid fashion to implementation in another part of the organization.
POTENTIAL BENEFITS OF TQM:
The advantages of adopting TQM system compared to conventional quality system are numerous and are outlined below:
1.
TQM helps to focus clearly on the needs of the market. The traditional approach of quality control focuses on the technical details of a product so as to satisfy the customer. However, the customer longs for different satisfaction perspectives which are generally overlooked in the traditional approach. The needs change from person to person and also from place to place. As TQM focuses on the concept of universality, it tries to abstract the satisfaction perceptions of market and thus helps the organisation to identify and meet the requirements of the market in a better way.
2.
TQM facilitates to aspire for a top quality performer in every sphere of activity. It is a well accepted fact that the negative attitudes of employees and non participative culture of the organisation’s success, growth and prosperity. TQM emphasises, on bringing about attitudinal and cultural change through promotion of 45
participative work culture and effective team-work. This serves to satisfy the higher human needs of recognition and self-development and enhances employee’s interest in the job. The employee’s performance, thus, is not restricted to the product or service areas but reflects in other spheres as well.
3.
It channelises the procedures necessary to achieve quality performance. Quality 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 quality policies, goals and objectives, and communicating these properly to one and all in the organisation, adopting SQC and SPC techniques and developing and using a system of evaluation, the organisations can channelize their efforts to achieve the desired and objectivated quality performance.
4.
It helps examine critically and continuously all processes to remove non productive activities and waste. The organisations always aim at improving productivity 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 improvement teams which meet regularly and through a systematic approach which tries to remove non-productive activity. A continuous effort to identify the problems and resolve them helps to reduce the waste. The culture of well being thus improves housekeeping, cost-effectiveness and safety.
5.
It gears organisations to fully understand the competition and develop an effective combating strategy. The dynamic changes in the global market and the open 46
market policies adopted by a large number of organisations ha resulted in increased competition and for many organisations the survival has become a key issue. For this cause, it is essential for the organisations to understand the competitions and develop and adopt suitable strategies to meet the challenge. As TQM helps to understand the pulse of the customer and thus the market, it gives an edge to the organisation to meet the competition.
6.
It helps to develop good procedures for communication and acknowledging good work. Improper procedure and inadequate communication are yet another bane of many
organisations,
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 management 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 period. They nee to be continuous to meet the dynamic challenges. TQM emphasises on a continuous and periodic review so as to make the required changes.
The benefits derived by the organisations, therefore, are many and multi-faceted. Many of these can be measured in quantitative terms. However, the intangible benefits, which include enrichment of the quality of the worklife and many more are not quantifiable. At the same time, it has to be established whether they do 47
occur or not in order to prove or disprove the efficacy of the concept. This can be assessed by a well-planned research project or by carrying out an opinion survey periodically. The tangible and intangible benefits of TQM are as presented
9.ADVANTAGES OF TOTAL QUALITY MANAGEMENT.
TQM is a collaborative system. It can be conceptualized as a network of processes
and activities through which various people in the organization can see different aspects of a problem and can constructively explore their own limited vision of what is possible.
48
TQM thus is an interdepartmental and inter organizational effort to address problems
of improvement. TQM provides a foundation for moving towards answering the questions of why, how
and with what consequences people participate in multiple dimensional problem solving. TQM does not rely solely on the chain of command; it develops multi-channel
interactive networks throughout the organizations. TQM is essential to establish cooperative links within the organization that can span
the various gaps among people to enable coordinate the action. TQM can be viewed to play a transformational role within the organization.
Transformational changes occur only when hard issues like budget, manufacturing marketing, disturbing and so on are blended with soft issues like values, culture, vision, leadership style, innovative behavior and so on.
THE ISSUES ARE ( MAY BE USE FOR PRESENTATION)
HOW DO WE GET EVERYBODY TO WORK TOGETHER ( Team Player)
HOW DO WE MAINTIN THEIR INVOLVEMNT (Interest/Motivation)
HOW DO WE MAKE THEM CONTIBUTE THEIR BEST (10% stretch game)
HOW DO WE CREATE THEIR SATISFACTION HOW DO WE CONTINUOUSLY IMPROVE
49
Problems/Issues Situation
ABC bank is one of the biggest banks in Asia established 85 years back. Recently it was faced with some problems such as increased. Customer complaints, inconsistent service at the front counter, unbalanced investment resulting in reduced profit margins and a significant drop in customers. Solution:
The Organization, therefore, set up a quality improvement team which took up a ‘Customer Care’ program to bring about a change in managing customer service. The program primarily focused on trouble shooting, customer service improvement and improving the management and staff relations. In building quality this, the groups were composed of people from all levels and no status titles were assigned. Groups were set up keeping in view the group dynamics and small group bonding principles in mind. The workshops were arranged for the groups focusing on a super ordinate goal to put the ‘Customer First’ as a philosophy. The workshops opened with personal value searching session so as to create a motive for action. To further the value motive the prospects of personal growth were reviewed. A congruence between personal value and organizational goal was established. The workshop programmes emphasized on creative problem solving approach to permit innovation, and challenge the existing cultural norms. During the workshops the culture, work environment and attitudes towards customers in the banking section were discussed openly, resulting in developing a sense of trust and commitment amongst participants.
50
Through these workshops a network of committed people was established across the branches. To promote commitment and strong bonding, the rewards were given. The process percolated downwards and the cultural change upwards. Thus, by stepping outside the system and focusing on motivation and reward, the organization brought about a necessary cultural change to keep the satisfaction of the customer as a primary goal of all the employee.
TQM FAILURES CASE EXAMPLE:
Mr. Pandit, President of G.T. Electronics, read a lot about the
TQM.
He
instructed the subordinates to arrange a meeting with all department heads and plan to implement TQM in G.T. Electronics. Mr. Pandit personally addressed the meeting and subsequently also wrote an enthusiastic article about TQM in the company newsletter. 51
He sent the top managers for TQM training programs and declared that the TQM be initiated. However, he himself later got involved with joint ventures in Europe. The TQM program was forgotten. When he returned to the country. After few months, he found that very few people showed interest in TQM. The earlier initiative and interest waned out because of the CEO’s lack of convication.
10.Caparo at a Glimpse
"Caparo is more than a successful business enterprise - it is a story of people, of values and of human effort. Above all it is a story of faith and family" - Lord Paul, Chairman and Founder.
52
Caparo is a fast growing global association of businesses with over a 1bn Euro turnover. With interests predominantly in the design, manufacture and marketing of steel, automotive and general engineering products, Caparo’s wider activities encompass also new product development, materials testing services, hotels, media, furniture and interior design, financial services, energy, medical products and private equity investment. The Group was founded in 1968 by Indian born British Industrialist, the Rt. Hon. Lord Paul of Marylebone, who remains Chairman. Today, Caparo and its associates employ more than 9,000 people in their worldwide operations across Europe, North America, Asia, the Middle and the Far East.
In 1968 Lord Paul took out a £5,000 loan and opened Natural Gas Tubes. The company, based in Huntington in Cambridgeshire, manufactured spiral weld tubes and achieved first year sales of £14,000. In 2006 Caparo group’s sales exceeded £625m.
Lord Paul's roots go back to the little Punjab town of Jalandhar in India where, in 1910, his father started by making steel buckets, tubs, trunks and agricultural implements, and had a small foundry at the back of the family home. From this modest undertaking Apeejay Surrendra Group has grown into one of India's largest family owned industrial groups in a wide range of industries : steel, engineering, pharmaceuticals, hotels, shipping and tea.
53
Lord Paul and his brothers grew up surrounded by their father's small business and succeeded him in its diversification and expansion. From his father, Lord Paul and his brothers learnt three important business lessons: integrity, hard work and the value of close family ties. Though the business prospered, the family continued to live frugally, following the Hindu prescription "simple living and high thinking". Anecdotes recall that when Lord Paul's mother was asked why she wore no jewels, she would proudly declare: "my sons are my jewels." This ethic of close family ties continued and Lord Paul attributes much of his business success to the moral and emotional support he received from his three brothers - Stya, Jit and Surrendra, and the happy home life created by his wife, Aruna. This web site provides an overview of the companies that make up the Caparo Group today. It also aims to tell you something of the internal spirit, the "what drives Caparo" story. Above all this is the story of a vision inspired by Lord Paul’s daughter Ambika, who was responsible for his move to England.
"Our success in the years to come will continue to depend on the skill of our family and management in reacting to opportunities, whilst continuing with determination, integrity and the principles that have carried us successfully this far" – Lord Paul.
The Caparo group has been built through a combination of acquisitions, organic growth of established businesses and the development of greenfield projects. The 54
Group is particularly proud of the latter, which demonstrates its skill at building technology based steel product companies from scratch, and penetrating export markets. Under the leadership of Angad Paul, appointed as Chief Executive in 2002, Caparo continues this successful formula for growth. The grouping of independently managed business units, mainly operating in metal and related markets, gives both critical mass and a stable platform for growth. A customer oriented philosophy, striving to provide products, services and solutions of the highest quality at competitive prices is coupled with a lean and flat corporate structure ensuring low overheads and rapid decision making. These key features are at the core of Caparo’s success.
"Success will happen so long as you work hard and with integrity" - Lord Paul.
Caparo has never been a company that is highly centralised and there is never any intention of changing the individual character of each operating division by dictating a specific company mission statement or vision. However Caparo is built upon some core values and beliefs and it is these that guide our decisions and our attitudes. These ethics were developed from Lord Paul’s Anniversary speech in 1994 which celebrated 25 years of Caparo. THE CAPARO ETHIC
• Caparo is something more than a successful enterprise…it is a story of people, of values and of human effort.
55
• Working together we can build Caparo with resolution, fortitude and ability. • The goodwill and confidence of Caparo employees, our suppliers, our customers and our managers is the bedrock of our business • Always aspire for excellence; nothing else is good enough • Never abandon hope • There is no such thing as bad business; only bad management • “What I like is people who are proud of what they do” Lord Paul • Our aim is to always be in the top 10% of performers (measured against our industry competitors) • Success will happen so long as you work hard, with integrity • Find excitement in industry and your own job in it • Cherish the enduring values of fidelity, truth and integrity
Guiding Principles Upholding the Caparo name • Customers and suppliers trust Caparo based on our capability and integrity qualities
that
underpin
our
reputation.
• We seek to work with only those customers and suppliers who share our 56
standards
of
legitimacy
and
integrity.
• We use all assets belonging to Caparo and to our customers and suppliers, including tangible and intellectual assets, in a manner both responsible and appropriate to the business. Behaving Professionally •
We
offer
•
only
We
those
services
meet
that
our
we
believe
contractual
we
can
deliver.
obligations.
• We believe that leadership demands courage, vision and integrity. • We achieve excellence through innovation, learning, agility and team work. Respecting Others • We take pride in the diversity of our workforce and view it as a competitive advantage
to
be
nurtured
and
expanded.
• We try to balance work and private life and help others to do the same. • We invest in the continuing development of our skills and abilities to meet the needs of the business. Corporate Citizenship • We express support for fundamental human rights and avoid participating in business
activities
that
abuse
human
rights.
• We act in a socially responsible manner, within the laws, customs and traditions of the countries in which we operate, and contribute in a responsible manner to the
development
of
communities.
• We aspire to act in a manner that minimises the detrimental environmental impacts
of
our
business
57
operations.
• We encourage the support of charitable, educational and community service activities. In the Workplace Professionalism • We disclose confidential information or personal data only when appropriate approval to do so has been obtained, and/or we are compelled to do so by legal or regulatory
requirements.
• We use all assets belonging to Caparo and to our customers and suppliers, including tangible and intellectual assets, only for legal and authorised purposes. • We aim to avoid conflicts of interest. Where potential conflicts are identified we discuss them with Senior Management to agree a framework for managing the
potential
conflict.
• We compete vigorously, engaging only in practices that are legal and ethical. • When faced with difficult issues or issues that place Caparo at risk, we consult appropriate
Caparo
colleagues
before
taking
action.
• It is unacceptable for us to receive or pay bribes, or to offer or receive any form of inducement as a means to derive any un-worthy advantage, either over our customers or suppliers. Working together • We respect the confidentiality and privacy of our customers and suppliers, our colleagues
and
others
with
whom
we
do
business.
• We treat our colleagues, customers and suppliers and others with whom we do business •
We
with
respect
respect, the
experience
dignity, and 58
fairness opinions
of
and our
courtesy. colleagues.
• We recognise the need to communicate at all levels of the business. • We are committed to maintaining a work environment that is free from discrimination
or
harassment.
• We provide a safe working environment for our people.
An expansion into automotive and aerospace markets, whilst maintaining and developing the steel and engineering business, is a key strategy for the group. This has been highlighted by the launch of the Caparo T1 high performance sports car in 2006, which showcases many of Caparo’s innovative new products and processes in this sector.
The development of Caparo Vehicle Products, a grouping of Tier 1 component design, engineering and manufacturing companies providing advanced solutions to the automotive, aerospace, military and motor sport markets is just one of the key initiatives being developed within the group. Furthermore the creation of Caparo Testing Technologies, a
group of
businesses
specialising in
comprehensive Destructive and Non-Destructive Testing (NDT) services will provide support to the aerospace industry and offer a valuable service to other Caparo group companies. Geographically, Caparo’s plans to create a leading automotive components manufacturing group in India are well advanced. From an initial joint venture with the major Indian car manufacturer Maruti Udyog in 1994, Caparo have established a wide range of businesses and now operate on 22 sites in India and plans are in place to develop a further 9. Caparo India’s activities will serve not only the regional automotive sector, but also established Caparo customers worldwide where Caparo will continue to provide local service and support, with the benefits of Asian manufacturing.
59
•
Aerospace
•
Engineering
•
Innovation
•
Investment
•
Leisure
•
Steel Products
C OMPANIES In 1968 Lord Paul started Caparo with one small factory in Huntingdon. Over 40 years later it has grown into a circa 1bn Euro business employing over 9,000 people worldwide.
Caparo today a fast growing global association of businesses, encompassing over 50 companies operating at more than 70 sites across the UK, Europe, North America, Asia, the Far and the Middle East. With interests mainly in the design, manufacture and marketing of steel, automotive and general engineering products, Caparo's wider activities encompass new product development, investment, materials testing, media, hotels, furniture, interior design, energy and medical products. And Caparo is still growing - in 2006 alone it acquired 22 companies. This section of the website aims to provide an overview of our divisions. We have also taken this opportunity to show you the products and services each company offers in order to create a full and clear picture of our wide range of capabilities. If you have any questions about a product or a service, please use the direct contact details available on each of the companies' profile pages, or
60
visit their websites. Alternatively you can contact Caparo using the on-line enquiry form in the Contact Us section. Caparo is a diverse, fast growing group with a customer orientated philosophy. Our strategy centres on supplying products of the highest quality at competitive prices coupled with a lean and flat corporate structure resulting in fast decision making.
Contained within this section is an overview of the products we manufacture and supply; from steel tubes, where it all began, to file handles, forgings and braking systems. To help you navigate around this section of the site we have grouped our products, services
and markets into divisions. These divisions are
predominantly product orientated and a list is provided below. Alternatively, if you already know what you are looking for please use our product search facility. If you still cannot find what you are looking for please contact us via the online enquiry form. •
Aerospace
•
Engineering Products
•
Investment
•
Steel Products
•
Vehicle Products •
Engineering
•
Innovation
•
Leisure 61
•
Steel Products
•
Vehicle Products S
SERVICES Caparo believe not only in supplying products of the highest quality at competitive prices but in providing customers with a range of services from cutting steel tube to length to non destructive testing. Caparo work in partnership with both customers and suppliers and aim to be a solutions provider not just another component supplier.
This section of our website introduces some of our key services; from steel distribution and stockholding to advanced vehicle design and materials engineering consultancy. To help you navigate around this section of the site we have grouped our services into divisions. Alternatively, if you already know what you are looking for please use our search facility. If the service you are looking for is not listed please contact us via the on-line enquiry form. As a flexible and customer orientated organisation, we will endeavour to provide the service you require.
ore
Products
Precision and light wall mechanical ERW steel tubes in Circular, Square, Rectangular, Flat Sided Oval, Flo-Coat and Electrical Conduits.
62
Steel
Cold Reduced, Hot Rolled Pickled and Oiled, High Strength Steels, Hot Rolled Black, Pre-galvanised and Aluminised. Precision
and
Circular:
Light
12.7mm
Square:
Wall
x
15.88mm
–
60.0mm
Mechanical
0.9mm
–
ERW
Steel
Tubes:
82.5mm
x
6.0mm
x
15.88mm
x
60.0mm
x
0.9mm x
2.5mm
Rectangular: 25.4mm x 12.7mm x 0.91mm – 60.0mm x 30.0mm x 3.0mm Flat Sided Ovals: 30.0mm x 15.0mm x 1.2mm – 60.0mm x 30.0mm x 2.5mm Electrical Conduit: 20mm, 25mm, 32mm, 38.1mm, 50mm Approvals
QS-
9000
including
BS
EN
ISO
9002
:
1994
BS EN 9001 : 2000 (Cert No. FM 94407) Caparo Precision Tubes produce precision tubular products in accordance with BS EN 10305-3/5. In addition to this standard, tubes are produced to stringent customer specific standards across a wide range of industries. Along with the products detailed below, Caparo Precision Tubes have the ability to help customers achieve engineered solutions for new and existing projects by the use of specific steel grades and the optimum use of sections. Cold
Rolled
Reduced
(CR)
A superior surface finish coupled with close dimensional control makes this product ideal for high quality surface coatings and a wide variety of precision engineering uses. Applications include domestic, kitchen and garden furniture, shop fittings, prams, pushchairs, shopping trolleys and other uses where optimum surface finish is desirable.
63
Hot
Rolled
Pickled
and
Oiled
(HRPO)
This material is widely specified where tubes require high quality powder Caparo precision and light wall mechanical ERW steel tubes are available in a comprehensive range of dimensions, grades and steel finishes. Hot
Rolled
Black
(HRB)
A general purpose cost effective utility tube. This product, developed by Caparo, is used extensively through the agricultural, construction and general fabrication industries where the combination of strength, and economy is a major consideration. These tubes are entirely suitable for painting and hot dip galvanising. Pre-Galvanised
Manufactured from Pre-Galvanised strip for optimum surface quality. Applications include bath stands, ceiling mountings, tents and awning frames, roof racks, aerial masts, rotary dryers, line posts and props. Aluminised
and
Perforated
These tubes are produced from pre-coated strip and are widely used for automotive exhaust assemblies. Hot
Dipped
Galvanised
All Caparo tubes are made to a chemical analysis that is ideally suited to hot dip galvanising. The controlled silicon and phosphorous levels give reactively light zinc coatings and prevent the occurrence of ‘grey bar’ effect. Flo-Coat
An in-line galvanised product which gives the customer a clean, bright tube suitable for numerous applications. Flo-Coat allows further coating/painting without precleaning. Typical uses include garden and leisure outdoor products, children’s play equipment, storage systems, conveyor rollers.
64
Plastic
Coated
Off-line plastic coated tube is supplied in a variety of finishes and colours. This tube offers the strength of steelplus the aesthetic appeal of plastic. It can be supplied in a variety of colours and textures. Typical applications are outdoor, gardening equipment, handrails and garment rails. Conduit
Barton, Longmore and Hayes brand conduit tube are market leaders in the UK and
overseas.
Barton conduit is manufactured in the UK at our Oldbury factory which is the largest British tube mill manufacturing conduit and precision tube with highly automated
mills
and
finishing/packaging
equipment.
Made from consistent high quality ‘continuous cast, manufactured E.U. (predominately British) steel. Conduit tube is rolled from steel which we specify shall have physical properties which allow easy on site manipulation without risk of splitting or fracture. Every length of conduit tube is hard stamped during the manufacturing process with the Company Name, UK origin, Standard Number, Corrosion Class and a production date code which allows full traceability. Prompt despatch from very substantial finished product stocks. Includes both popular 20mm and 25mm products and also 32mm, 1 1/2” and 2”conduit tube. Modern in house painting plant using a water based system with excellent appearance and durability. Black painted conduit tube ex stock. BSI Management Systems Ltd. audits Barton Engineering's Quality Management System and confirms it complies with BS EN ISO 9001:2000 In addition to supplying both 3.75 mtr and 3.0 mtr lengths of conduit tube from stock. Modern automated equipment allows us to supply
65
batches of conduit tube cut to length without the extended lead times and high labour costs traditionally associated with non standard spot orders.
Caparo group companies can offer the aerospace industry a diverse range of solutions. Further expansion into this market is part of Caparo’s ongoing commercial strategy.
Products supplied to the aerospace market include Anti Shock Vibration mounts from Caparo Dymanics. The range of lightweight mounts is compact enough to be used in a variety of aerospace applications. Accles and Pollock have been forming tube with ingenuity since the early 20th Century – developing the skills that have enabled its tube to be used in the most demanding aerospace applications. Examples include fuel carrying pressure hoses, part of an aircraft’s sub-system, used to maintain correct functioning of reverse thrusters.
66
Whilst these products are featured in the following pages, the products supplied to the aerospace market by the group range from aluminium castings to forgings and steel tube. For more information on any of these products please follow the links below or alternatively contact us using the online enquiry form.
In 1995 Caparo Industries formed Caparo Engineering from their various smaller and medium sized engineering companies based in the West Midlands, England. This strategy gave these companies a critical mass without losing the focus of the individual companies.
Individual companies operate autonomously within Group guidance and the Caparo philosophy. All companies are highly service orientated seeking close partnerships with their customers. They aim to be proactive, innovative and flexible. They are tightly run and seek to be a low cost producer within their industry. There is a commitment to develop continuously their products, service and people. The majority of the manufacturing plants, with the exception of a forges in the North East of England and Poland, are in the Black Country region of the West Midlands, England.
Caparo Steel Products is one of the UK’s largest steel conversion and distribution businesses, manufacturing an extensive range of structural steels, precision tube, spirally welded tube, special bar qualities, industrial wires, cold rolled strip and spring steel strip. 67
Caparo Steel Products satisfies the steel demand for a wide variety of industries, including construction, steel fabrication, steel pressing, mechanical engineering, forging, mining, quarrying, automotive, shipbuilding, railways, petrochemical, handtools, precision blades, springs, farming, furniture, leisure, etc. All Caparo Steel Products' divisions are closely associated in terms of their customer and supplier base and this new formation has given the group the benefit of a critical mass without losing the focus of the individual businesses. Adoption of best practices and cross fertilisation of ideas is continually helping to progress all Group companies. The products manufactured and supplied by the group are detailed within this section of the website.
Offering design, rapid prototyping and sample development, as well as series production and line side delivery, the Caparo Vehicle Product group combines its portfolio of products and services to provide full vertical integration to its customers.
The majority of the companies in this division are manufacturing orientated, with the exception of the consultancy services offered by Caparo Vehicle Technologies (CVT). CVT is an advanced automotive technology and engineering design company, focused on providing technology development, materials engineering and design services to the mainstream automotive, motorsport and aerospace markets. In addition to their skills in vehicle design and engineering the company has particular expertise in materials technology. The company has gained the 68
services of Ben Scott-Geddes and Graham Halstead who were responsible for the Mercedes SLR McLaren sports car. This unique capability and understanding of materials performance, including how materials as dissimilar as aluminium, advanced composites, engineering plastics and high strength steel can be joined and which is the best material for a particular part of the car - is important to manufacturers needing to reduce the weight of vehicles to make them more fuel efficient without compromising active and passive safety. For more information on the companies within the Vehicle Products group please visit the companies section of the website.
Caparo group has invested in a diverse portfolio of companies from film distribution to private equity investment. Introductory information about these companies is detailed below. AV Pictures is a film company involved in the financing, production and
international sales of independent feature films. The company is steadily building its library of film rights. The library currently includes School for Seduction, starring Kelly Brook, Wilderness, starring Sean Pertwee and The Other Half, starring Danny Dyer. To learn more about AV Pictures please visit www.avpictures.co.uk. Core Capital is a specialist private equity investor of which Caparo is an anchor
investor and commercial partner. For more information on the products provided by Core Capital please visit www.core-cap.com. Film24 is a television channel dedicated to films, which is available on Sky
Digital, channel
158. For
more
information on Film24 please
www.film24.com. 69
visit
Hapax has developed patented search engine technology, which combines
artificial intelligence with natural language processing. The company sells solutions for media monitoring and ad serving from its offices in Stockholm and London. To learn more about Hapax please visit www.hapax.com. Caparo (GCC) is a Dubai based company, related to Caparo, which serves the
Group’s customers in the Gulf region. The business specialises in metallic cable protection systems, including conduit tube, trunking, tray, flexible conduit, and all associated accessories and fittings. It also provides a wide range of mobile non-destructive testing (NDT) services dedicated to the aviation, aerospace, construction, power generation, oil and gas and motor sport industries. For more information
on
the
Caparo
(GCC)
products
and
services
visit
www.caparogcc.com. Caparo China focuses the Group’s current business activities in the Far East,
and in particularly Greater China. It is a base for marketing Caparo in this part of the world, whilst at the same time providing a number of related services to the other Caparo subsidiaries. Established & Sons is a London based design company synonymous with
innovative contemporary design. Working with some of the world’s leading designers, architects and artists, it has already created a number of iconic furniture and fittings collections and secured prestigious awards such as “Best British Established Design Brand”, Elle Decoration International Design Award, 2008 and “Hall of Fame for Outstanding Contribution to the Design Industry”, Design Week, 2009. To find out more visit www.establishedandsons.com.
•
Innovation & Technology
•
Innovation News 70
home / innovation & technology INNOVATION & TECHNOLOGY The Innovation and Technology section of the website aims to promote the new ideas, techniques and procedures within the Caparo group and how they are helping our customers to improve their products.
Caparo’s dedication to innovation is represented via ‘The Caparo Innovation Centre’. Caparo CEO, Angad Paul demonstrated his dedication to the commercialization of inventive ideas at the beginning of 2003 via the collaboration between Caparo plc and the University of Wolverhampton. Based in the creative environment of Wolverhampton Science Park, the Caparo Innovation Centre is an imaginative new approach to turning product ideas into business realities. Angad Paul’s commitment to innovation design and quality production is further exemplified via his part in the creation of Established and Sons; a UK-based design and manufacturing company with an ambition towards fostering and promoting the best of British design talent on the international stage. The Aqua Table, designed by Zaha Hadid, was part of Established and Sons’ debut collection in 2005. The table is proving to be a design phenomenon; one of the two Limited Edition prototypes was sold at auction for $296,000. A recent development within the group is Studio Caparo, a design and prototyping business specialising in the manufacture and installation of bespoke one-off limited edition and batch produced pieces of furniture. Like a studio the company has gathered many processes and materials under one roof allowing unparalleled operational flexibility. The company is collaborating with Established and Sons to bring the Drift bench to life; an innovative piece of 71
furniture, designed by Future Systems architect, Amanda Levete. The piece recently won the Best Furniture Award at the Design Week awards in February 2007. News of innovation and technological advances within the Caparo group will be posted on the Innovation News section of the site. Caparo is a key player in an extensive range of market sectors. Since Lord Swraj Paul founded the group in 1968 Caparo has expanded its product portfolio from steel tube via strategic acquisitions and new start up projects. North
America
Entry into the global marketplace was achieved via the acquisition of Bull Moose Tube Company in 1988 which allowed Caparo to expand into the North American steel market. Steel tube is currently sold into the North American agricultural, automotive and construction markets. India
In India Caparo is specializing in the manufacture of vehicle components and is building a reputation in this market place as an engineering solutions provider to the automotive market. UK
and
Europe
In the UK, the Steel Products group is now one of the UK’s leading steel conversion businesses supplying the agricultural, construction, furniture, power generation, tooling and automotive markets with steel tube, wire, scaffolding and precision strip.
72
The development of the Engineering and Vehicle Products groups have allowed Caparo access to the automotive, defence, marine and petrochemical markets, to name only a few. Following numerous acquisitions in 2006 Caparo Aluminium, part of the Caparo Engineering group, is now the leading sand and gravity die caster accounting for 50% of UK output. Caparo’s UK manufacturing expertise is now being used to develop new markets around the world. In India Caparo are building a forge and aluminium foundry in order to provide customers with an international solution – bringing them the benefits of the east and the west. Caparo’s market places are detailed in the following pages with links to key products and services.
73
11.Recommendations and Suggestions on TQM We found that Caparo is having problem of shortage of material supply , etc we recommend them following solutions: 1. Total employee involvement in decision making. 2. Monthly quality review of product 3. Internal quality management for employees In Mahindra & Mahindra – FES we found problem of employee rigidity and beaurocratic behavior towards working style. We recommend them: 1. Employee involvement in decision making & strategic planning 2. Treat all employees on same scale – uniformity in employee treatment. 3. Improvement in Internal quality management for employees
74
12.LIMITATIONS OF THE STUDY
There was lack of time. As we know research work is time taking process..
Secondary data has been collected from different- different sources like internet and books. So data collected through internet might not be more reliable.
75
