Lecture 32-33:Total Quality Management

CEE 498 Construction Project Management

Jeffrey S. Russell, P.E., Ph.D.Construction Engineering & ManagementCivil & Environmental EngineeringUniversity of Wisconsin-Madison

Structure

I. TQM video by Deming

II. Reasons to learn about TQM

III. Cost of quality

IV. Total quality management principles

V. Tools of TQM

VI. Quality process component

Structure (Cont’d)

VII. Barriers to TQM

VIII.Benefits of TQM

IX. Summary

I. TQM Video By Deming

I. TQM video by Deming

A. Relation to project objectives

1. Cost

2. Scheduling - Time

3. Safety

4. Quality

I. TQM Video By Deming (Cont’d)

B. Relation to topics1. Systems approach - Facilities Delivery

Processa) Whatb) Whyc) How

2. Constructability3. People/Productivity - most important

asset/resource4. Teams - cooperation, not

competition

I. TQM Video By Deming (Cont’d)

5. Win-win negotiating lectures6. Communication - among and

between suppliers, workers, etc..7. Leadership8. Ethics - trust

C. Deming’s 14 points of TQM - See Attachment #1

II. Reasons To Learn About TQM (Cont’d)

A. Engineers need to use their technical expertise and the quality process to improve product quality and their firm’s productivity

B. Engineers need to use their interpersonal skills as a change agent and contest for power in an organization

C. Engineers need to understand that management is a part of engineering - it is not apart from engineering

II. Reasons To Learn About TQM (Cont’d)

D. Engineers need to be creative in improving the engineering process, and recognize that “quality” is not features; that is, a Ford-built Lincoln has more features than a Ford-built Taurus, but it does not necessarily have higher quality

E. Engineers need to think beyond issues of technology, and learn the means whereby people, processes and technology come together

III. Cost of Quality

A. Contractors pay a significant price for poor quality resulting from accidents, waste, rework, inefficiencies, poor subcontractor performance and poor communication - these costs are estimated to be between 5% and 30% of the construction cost of a facility

B. Cost of nonconformance - includes both direct and indirect costs of not doing things right the first time

III. Cost of Quality

1. Factorsa) Accidentsb) Omissionsc) Errorsd) Poor workmanshipe) Being late

2.Resultsa) Reworkb) Recallsc) Expediting

III. Cost of Quality (Cont’d)

d) Removal of punch list items

e) Time extensions

f) Litigation costs and damages

g) Penalties and liquidated

damages

h) Increased insurance costs

III. Cost of Quality (Cont’d)

C. Cost of Conformance - includes preventive measures

1. Inspection of direct hire work

2. Inspection of subcontractor work

3. Inspection at vendor source of supply

4. Inspection of shipments

5. Review of shop drawings

III. Cost of Quality (Cont’d)

6. All training costs, including safety7. Facilitator costs8. Salary of quality coordinator9. Meetings of the steering committee

and quality improvement teams10. Administration of the quality

management program11. Reward system

IV. Total Quality Management PrinciplesProvide understanding of and guidance on

the application of TQM - See Attachment #3

A.Customer-Driven Organization

1. Organizations depend on their customers and

therefore should understand current and future

customer needs, meet customer requirements,

and strive to exceed customer expectations

IV. Total Quality Management Principles (Cont’d)

2. It requires 10 times as much money to attract a new

customer than it requires to keep a customer you

already have......keep the present customer happy

B. Leadership

1. Leaders establish unity of purpose, direction, and the

internal environment of organization; they fully

involve people in achieving the organization’s

objectives

IV. Total Quality Management Principles (Cont’d)

2. The difference between an average and an

outstanding company is the leadership they have

C. Involvement of People

1. People are the essence of an organization and

their full involvement enables their knowledge

and experiences to be used for the organization’s

benefit

2. Employees are a company’s greatest asset

IV. Total Quality Management Principles (Cont’d)

3. An individual without information can not take

responsibility; an individual with information

can and will take responsibility

D. Process Approach

- A desired result is achieved more effectively when related resources and activities are managed as a process

IV. Total Quality Management Principles (Cont’d)

E. System Approach to Management

- Identifying, understanding, and managing a

system of interrelated processes for a given

objective will contribute to the effectiveness

and efficiency of the organization

IV. Total Quality Management Principles (Cont’d)

F. Continual Improvement

- See Attachment #4

1. Continual improvement is a permanent

objective of the organization

2. In the race for quality, there is no finish line

3. Quality comes from within; it comes from the

hearts and the minds of the people

IV. Total Quality Management Principles (Cont’d)

G. Factual Approach to Decision Making - Effective

decisions and actions are based on the analysis of data

and information

H. Mutually Beneficial Supplier Relationships1. Mutually beneficial relationships are established to

enhance the ability of both organizations to create

value

2. Relates to Partnering - Lecture 33

V. Tools of TQM

A. Check Sheet - See Attachment #5

1.Tabulates frequency of occurrence

2.Easy to use and understand

3.Data gathered here can be used in

other tools

V. Tools of TQM (Cont’d)

B. Graph

1.Visual display of data

2.Major types

a) Line graph

b) Bar chart

c) Circle diagram (pie chart)

V. Tools of TQM (Cont’d)

C. Histogram - See Attachment #6

1.Portrays frequency of occurrence2.Shows various measures of central

tendency

D. Pareto Chart - See Attachment #7

1.Visually portrays problems and causes in order of severity or frequency

V. Tools of TQM (Cont’d)

2.Helps determine which problems or cause

to tackle first

E. Cause-and-effect diagram

- See Attachment #8

1.Portrays possible causes of a process

problem

2.Helps determine root cause

V. Tools of TQM (Cont’d)

F. Scatter diagram - See Attachment #9

1.Indicates the relationship between two

variables

2.Displays the strength of that relationship

G. Control Chart - See Attachment #10

1.Monitors a process to determine magnitude

of variation

V. Tools of TQM (Cont’d)

2.Estimates the parameters of a process

3.Reduces the variability of a process

H. Flowchart - See Attachment #11

1. Portrays all the steps in a process

2. Helps understand the process

VI. Quality Process Component

A. Motivation

- based on recognition, commendation, recommendation, repeat business, reward

B. Communication

- must be team-wide, involving all partners, as well as thorough, honest, and complete

C. Commitment

- to the project, to the process, to all the partners, and to the promised result

VI. Quality Process Component (Cont’d)

D. Expectations

- realistic, reasonable, communicated, understood, and accepted

E. Ability - adequate, understood, and consistent

F. Involvement - total, all-party, and consistent

G. Feedback

- thorough, understandable, and complete Follow-up - complete and consistent, as well as

long term

VII. Barriers to TQM

A. Lack of trained workers/poorly installed

equipment/poor workmanship

B. Competitive markets

C. Poor plans and scheduling

specifications/poorly defined work scope

D. Bad attitudes

E. Lack of competent field managers

VIII. Benefits of TQM

A. Better defined project scope and

objectives

B. Greater communication of objectives

C. Teamwork

D. Effective planning and scheduling

E. Appropriate Training

VIII. Benefits of TQM (Cont’d)

F. Improved quality of materials,

equipment, and workmanship

Case Studies - See Attachment #13

IX. Summary

TQM principles

Tools of TQM

Barriers to TQM

Benefits of TQM