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UNIVERSITI PUTRA MALAYSIA
RANKING OF TOTAL QUALITY MANAGEMENT’s CRITICAL TECHNIQUES IN THE MALAYSIAN AUTOMOTIVE INDUSTRY
AMIR AZIZI
FK 2007 25
RANKING OF TOTAL QUALITY MANAGEMENT’s CRITICAL TECHNIQUES IN THE MALAYSIAN AUTOMOTIVE INDUSTRY
By
AMIR AZIZI
Thesis Submitted to the School of Graduate Studies, Universiti Putra Malaysia, in Fulfilment of the Requirements for the Degree of Master of Science
May 2007
Abstract of thesis presented to the Senate of the Universiti Putra Malaysia in fulfilment of the requirement for the degree of Master of Science
RANKING OF TOTAL QUALITY MANAGEMENT’s CRITICAL TECHNIQUES IN THE MALAYSIAN AUTOMOTIVE INDUSTRY
By
AMIR AZIZI
May 2007
Chairman: Associate Professor Ir. Md. Yusof Ismail, PhD. Faculty: Engineering Today all organizations around the world are trying to optimize the business process
in the global market upon continuous improvement and total quality management in
order to survive in a competitive market. Since there are huge costs to implement all
tools and techniques of total quality management and it is not economical for any
organization to apply all. Nine Total Quality Management’s Critical Techniques
(TQM’s CTs) have been presented to implement in automotive industry. Each
technique has a special application but on the other hand, some of them can be used
for an assimilation objective and also some of them can be applied for more than one
objective. The main objective of this study has been based on both internal and
external customer satisfaction. In order to achieve the main objective, six significant
criteria as decision making parameters have been proposed. The study has ranked the
TQM’s CTs as alternatives regarding to each criterion through one of the best and
widely used decision making methods that is called Analytic Hierarchy Process
(AHP) in ten selected Malaysia automotive companies. It has also determined an
overall ranking of implementation of TQM’s CTs with respect to all criteria and by
considering their performance weight. The results of overall ranking of TQM’s CTs
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are listed as follows: (1) Advanced Product Quality Planning Process (APQP); (2)
Quality Function Deployment (QFD); (3) Failure Mode and Effect Analysis
(FMEA); (4) Production Part Approval Process (PPAP); (5) Statistical Process
Control (SPC); (6) Measurement Systems Analysis (MSA); (7) Management and
Planning (MP) tools; (8) Kaizen; (9) 5S.
It has also been found the weight of relationship of TQM’s CTs. For example,
FMEA and SPC, QFD and APQP, QFD and FMEA, and 5S and Kaizen have highest
relationship rather than other critical techniques of TQM.
Finally, an integrated implementation framework of the TQM’s CTs with respect to
their both relationship and performance weight has been suggested to create
awareness and to guide quality planning managers to have an effective
implementation of theses critical techniques of TQM.
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Abstrak tesis yang dikemukakan kepada Senat Universiti Putra Malaysia sebagai memenuhi keperluan untuk ijazah Master Sains
PENGKELASAN KAEDAH DAN TEKNIK KRITIKAL PENGURUSAN KUALITI YANG MENYELURUH DALAM INDUSTRI AUTOMOTIF
MALAYSIA
Oleh
AMIR AZIZI
Mei 2007 Pengerusi: Profesor Madya Ir. Md. Yusof Ismail, PhD. Fakulti: Kejuruteraan
Pada hari ini organisasi-organisasi diseluruh dunia mencuba untuk mengoptimumkan
proses perniagaan di dalam pasaran global melalui penambahbaikan berterusan dan
pengurusan kualiti menyeluruh agar kekal bersaing dalam pasaran yang kompetitif.
Memandangkan terdapat kos yang tinggi di dalam melaksanakan semua kaedah dan
teknik pengurusan kualiti menyeluruh dan adalah tidak ekonomikal bagi mana-mana
organisasi untuk mengaplikasikan kesemuanya. Sembilan Teknik-teknik Kritikal
Pengurusan Kualiti Yang Menyeluruh (TQM’s CTs) telah dibentangkan untuk
dilaksanakan di dalam industri otomotif. Setiap teknik mempunyai aplikasi yang
khusus tetapi pada masa yang sama teknik-teknik tersebut boleh digunakan untuk
objektif asimilasi dan kebanyakannya boleh diaplikasikan untuk mencapai lebih
daripada satu matlamat. Matlamat utama dalam kajian ini adalah berasaskan kepada
kepada kepuasan pelanggan dalaman dan luaran. Bagi mencapai matlamat utama,
enam kriteria penting sebagai parameter di dalam membuat keputusan telah
dicadangkan. Kajian ini telah mengkelaskan TQM’s CT’s sebagai alternatif bagi
setiap kriteria melalui kaedah yang terbaik membuat keputusan yang dinamakan
Proses Hierarki Analitikal (AHP) kerana ianya memberi keutamaan pelbagai
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alternatif bagi kriteria yang tertentu. Ianya juga boleh menentukan pengkelasan
keseluruhan TQM’s CT’s yang mengambilkira kesemua kriteria dan menimbangkan
prestasi pemberat bagi sepuluh kilang-kilang yang telah terpilih di dalam industri
otomotif di Malaysia.
Hasilan-hasilan daripada pengkelasan menyeluruh TQM’s CTs adalah disenaraikan
sepertimana di bawah: (1) Proses Perancangan Lanjutan Kualiti Produk (APQP); (2)
Pembahagian Fungsi Kualiti (QFD); (3) Analisa Kegagalan Mod dan Kesannya
(FMEA); (4) Proses Kelulusan Bahagian Pengeluaran (PPAP); (5) Proses Kawalan
Statistikal (SPC); (6) Analisa Sistem-Sistem Pengukuran (MSA); (7) Peralatan-
Peralatan Pengurusan dan Perancangan (MP); (8) Kaizen dan; (9) 5S.
Ianya juga telah menghasilkan perkaitan pemberat TQM’s CT’s. Sebagai contohnya
FMEA dan SPC, QFD dan APQP, QFD dan FMEA, 5S dan Kaizen mempunyai
perkaitan yang tinggi berbanding dengan teknik-teknik kritikal Pengurusan Kualiti
Menyeluruh (TQM) yang lain.
Akhirnya, kerangka perlaksanaan bersepadu TQM’s CT’s yang merujuk kepada
perkaitan dan pemberat prestasi telah dihuraikan bagi memberi kesedaran dan
panduan kepada pengurus-pengurus perancangan kualiti bagi perlaksanaan teknik-
teknik kritikal Pengurusan Kualiti Menyeluruh (TQM).
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ACKNOWLEDGEMENTS
I would like to give greatest thanks to my father, Abolghasem Azizi, for his financial
support, encourage, and guidance. Thanks from the bottom of my heart to my mother
for her affection and compassion.
I would like also to express my deepest gratitude to Dr. Md. Yusof Ismail, the
chairman of my supervisory committee. With all his encouragement, patience, expert
advice, warm understanding, and coordination of my research. In addition, I would
like to thank my other two supervisory committee members, Dr. Napsiah. Ismail, and
Dr. Md. Sapuan Salit for their helpful recommendation.
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This thesis submitted to the Senate of Universiti Putra Malaysia and has been accepted as fulfilment of the requirement for the degree of Master of Science. The members of the Supervisory Committee are as follows: Ir. Md. Yusof Ismail, PhD Associate Professor Faculty of Engineering Universiti Putra Malaysia (Chairman) Napsiah Ismail, PhD Associate Professor Faculty of Engineering Universiti Putra Malaysia (Member) Ir. Md. Sapuan Salit, PhD Associate Professor Faculty of Engineering Universiti Putra Malaysia (Member)
AINI IDERIS, PhD Professor/Dean School of Graduate Studies Universiti Putra Malaysia
Date: 17 July 2007
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DECLARATION I hereby declare that the thesis is based on my original work except for quotations and citations which have been duly acknowledged. I also declare that it has not been previously or concurrently submitted for any other degree at UPM or other institutions.
AMIR AZIZI Date: 04 June 2007
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TABLE OF CONTENTS
Page
DEDICATION ii ABSTRACT iii ABSTRAK v ACKNOWLEDGEMENTS vii APPROVAL viii DECLARATION x LIST OF TABLES xiii LIST OF FIGURES xiv LIST OF ABBREVIATIONS xvii CHAPTER 1 INTRODUCTION 1.1 Background of the Study 1.1 1.1.1 What is Total Quality Management? 1.1 1.2 Statement of Problem 1.2 1.3 Research Objectives 1.5 1.4 Benefit and Significance of the Study 1.5 1.5 Research Location 1.8 2 LITERATURE REVIEW
2.1 What are the Benefits of Implementing a Quality 2.1 Management System?
2.2 TQM and Organizational Performance 2.2 2.2.1 TQM Implementation Success 2.6 2.2.2 Difficulties of TQM Implementation 2.8
2.3 ISO 9001 2.10 2.4 QS 9000 2.10 2.5 ISO/TS 16949 2.11
2.5.1 ISO/TS 16949 - Automotive Suppliers 2.13 2.6 EFQM Fundamental Concepts 2.13
2.7 Quality Tools and Techniques in PDCA 2.14 2.8 TQM’s Tools and Techniques 2.18
2.8.1 Quality Function Deployment 2.27 2.8.2 5S 2.30 2.8.3 Kaizen 2.32 2.8.4 Management and Planning Tools 2.33
2.8.5 Five Core Techniques 2.35 2.9 Benefits of TQM’s Tools and Techniques 2.44
2.10 Difficulties of Usage of TQM’s Tools and Techniques 2.46 2.11 Interaction of TQM’s Tools and Techniques 2.47 2.12 TQM Factors 2.47
2.13 Decision Making 2.50
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2.14 Analytical Hierarchy Process 2.51
3 METHODOLOGY 3.1 Study 3.1 3.1.1 Data Collection 3.4 3.2 Initial Steps of Study 3.5
3.2.1 Nine TQM’s CTs 3.5 3.2.2 Objectives Functions 3.6 3.2.3 Six Significant Criteria 3.7 3.3 Ultimate Steps of Study 3.10 3.3.1 Hierarchy Model 3.10 3.3.2 Measurement Scales 3.13 3.3.3 Pairwise Comparisons 3.14 3.3.4 Ranking Method 3.15
4 RESULTS AND DISCUSSION 4.1 Results 4.1
4.1.1 Data Analysis 4.2 4.1.2 Interaction/Interrelationship of TQM’s CTs 4.6 4.1.3 Performance Preference of TQM’s CTs 4.8
4.2 Discussion 4.29 5 FRAMEWORK OF THE STUDY 5.1
6 CONCLUSIONS AND RECOMMENDATIONS 6.1 Conclusions 6.1 6.2 Recommendations 6.3 REFERENCES R.1 APPENDICES A.1 BIODATA OF THE AUTHOR E.1
xii
LIST OF TABLES
Table Page
2.1 Encountered difficulties of use of tools and techniques 2.9 2.2 History of application of Quality Management Tools (QMT) 2.18 2.3 Commonly used tools and techniques 2.19
2.4 Analysis of tools and techniques used within each function 2.23 2.5 TQM tools 2.24
2.6 Twelve tools and techniques for TQM 2.26
2.7 5S 2.32
2.8 Five core techniques 2.35
2.9 Use of basic SPC tools in Malaysian firms 2.39
2.10 Likelihood of occurrence 2.47
2.11 Eight critical factors for TQM 2.48
2.12 Summary of literature review 2.55
3.1 Decision making parameters 3.9
3.2 Five-points scale 3.13
3.3 Saaty’s nine-point scale 3.13
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LIST OF FIGURES
Figure Page
2.1 Complexity of 7 QC and 7 M Tools 2.15
2.2 PDCA and Seven Steps 2.16
2.3 Tools and Techniques in PDCA 2.17
2.4 Seven Quality Control Tools 2.22
2.5 Satisfaction with most Tools is Relatively High 2.25
2.6 TQM Conceptual Implementation Framework for Small Businesses 2.27
2.7 World Wide Quality 2.28
2.8 Five Core Techniques are Related to ISO-9001 and QS-9000 2.36
2.9 SPC Application Methodology 2.40
2.10 QFD and FMEA Interface 2.46
3.1 Research Flowchart 3.3
3.2 House of TQM’s CTs 3.6
3.3 Hierarchy Model of TQM’s CTs with respect to the Decision 3.12 Making Parameters
4.1 Categories of Companies 4.2
4.2 Types of Companies 4.3
4.3 Category of Teams 4.4
4.4 Experts’ Experience 4.4
4.5 Experts’ Education 4.5
4.6 Experts’ Designation 4.6
4.7 Interrelationship QFD with other TQM’s CTs 4.7
4.8 Highest Relationship between TQM Tools and Techniques 4.8
4.9 Hierarchy Framework of TQM’s CTs Efficiency 4.10
4.10 Ranking of TQM’s CTs Efficiency 4.10
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4.11 Performance Sensitivity of TQM’s CTs Efficiency 4.11
4.12 Hierarchy Framework of TQM’s CTs Effectiveness 4.12
4.13 Ranking of TQM’s CTs Effectiveness 4.12
4.14 Performance Sensitivity of TQM’s CTs Effectiveness 4.13
4.15 Ranking of TQM’s CTs Implementation Performance with respect to: 4.14 “Time to adopt as culture”
4.16 Ranking of TQM’s CTs Implementation Performance with respect to: 4.14 “Easy to use”
4.17 Ranking of TQM’s CTs Implementation Performance with respect to: 4.15 “Ability to increase or improve quality”
4.18 Ranking of TQM’s CTs Implementation Performance with respect to: 4.15 “Ability to analyze customer needs or affect on customer satisfaction”
4.19 Ranking of TQM’s CTs Implementation Performance with respect to: 4.16 “Ability to reduce quality costs”
4.20 Ranking of TQM’s CTs Implementation Performance with respect to: 4.16 “Ability to identify or reduce failures”
4.21 Contribution Percentage of Criteria and Alternatives 4.17 4.22 Hierarchy Framework of TQM’s CTs Implementation Performance 4.18
with respect to Goal: External Customer Satisfaction
4.23 Ranking of TQM’s CTs Implementation Performance with respect 4.18 to Goal: External Customer Satisfaction
4.24 Performance Sensitivity of TQM’s CTs Implementation 4.19 with respect to Goal: External Customer Satisfaction
4.25 Hierarchy Framework of TQM’s CTs Implementation Performance 4.20 with respect to Goal: Internal Customer Satisfaction
4.26 Ranking of TQM’s CTs Implementation Performance with respect 4.20 to Goal: Internal Customer Satisfaction
4.27 Performance Sensitivity of TQM’s CTs Implementation 4.21 with respect to Goal: Internal Customer Satisfaction
4.28 Ranking of TQM’s CTs Implementation Performance 4.22 with respect to final goal: “Overall Customer Satisfaction” 4.29 Performance Sensitivity of TQM’s CTs Implementation 4.22 with respect to final goal: “Overall Customer Satisfaction”
xv
4.30 Comparison between QFD and FMEA with respect to all Criteria 4.24 4.31 Ranking of TQM’s CTs Implementation Performance in aspect of 4.25
Foreign Companies
4.32 Performance Sensitivity of TQM’s CTs Implementation 4.25 in aspect of Foreign Companies
4.33 Ranking of TQM’s CTs Implementation Performance in aspect of 4.26 Local Companies
4.34 Performance Sensitivity of TQM’s CTs Implementation 4.26 in aspect of Local Companies
4.35 Ranking of TQM’s CTs Implementation Performance in aspect of 4.27 Large Companies
4.36 Performance Sensitivity of TQM’s CTs Implementation 4.27 in aspect of Large Companies
4.37 Ranking of TQM’s CTs Implementation Performance in aspect of 4.28 SMEs Companies
4.38 Performance Sensitivity of TQM’s CTs Implementation 4.28 in aspect of SMEs Companies
5.1 Operation Chart for TQM’s CTs Implementation Assessment 5.2
5.2 Proposed Framework for TQM’s CTs Implementation in 5.5 Automotive Firms
xvi
LIST OF ABBREVIATIONS
5S Sort, Systematize, Sweep, Standardization and Self-discipline
AHP Analytical Hierarchy Process
AIAG Automotive Industry Action Group
APQP Advanced Product Quality Planning
BIC Business Innovation Capability
Cpk Process Capability
DMACI Define-Measure-Analyze-Create-Implement
DIRFT Do-It-Right-The-First-Time
DSS Decision Support System
EFQM European Foundation for Quality Management
FMEA Failure Mode and Effect Analysis
FMM Federation of Malaysian Manufacturers
HOQ House Of Quality
IAOB International Automotive Oversight Bureau
IATF International Automotive Task Force
ISE Industrial and Systems Engineering
ISO International Organization for Standardization
JIT Just In Time
MADMM Multi-Attribute Decision Making Methods
MCCDM Multiple Choice Criteria Decision Making
MP Management Planning
MSA Measurement Systems Analysis
NIC Newly Industrializing Country
NPC National Productivity Cooperation
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xviii
PA Productivity Award
PDCA Plan-Do-Check-Act
PDPC Process Decision Program Chart
PDSA Plan-Do-Study-Act
PMQA Prime Minister Quality Award
PPAP Production Part Approval Process
QC Quality Control
QMEA Quality Management Excellence Award
QFD Quality Function Deployment
QM Quality Management
QMS Quality Management Systems
QS Quality Systems
RPN Risk Priority Number
S.O.D Severity, Occurrence, & Detection
SIRIM Standards and Industrial Research Institute of Malaysia
SMEs Small and Medium Enterprises
SPC Statistical Process Control
SQA Supplier Quality Assurance
TPM Total Productive Maintenance
TPS Toyota Production System
TQM’s CTs Total Quality Management’s Critical Techniques TQM Total Quality Management
TS Technical Specification
VOC Voice of the Customer
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
The concept of Total Quality Management (TQM) was introduced in some developed
countries such as; Japan and United States and resulted from the work of American
quality gurus like Joseph Juran, W Edwards Deming, and Armand Feigenbum and also
Japanese quality gurus such as Kaoru Ishikawa, Genichi Taguchi, and Shigeo Shingo
(Department of Trade and Industry, 2006). Chiefly TQM is classified into two
categories; soft TQM (principles and concepts) and hard TQM (tools and techniques)
(Wilkinson et al., 1998; Evans and Lindsay, 1999). More attention to TQM has been
applied in the manufacturing sector especially in automotive industry (Shamsuddin and
Masjuki, 2003). Indeed quality is a vital, critical and competitive factor in today’s
business world. Most of the companies are looking for higher quality and lower cost by
implementing Quality Management Systems (QMS) such as ISO 9000 series, QS9000,
and TS16949 to attain higher customer satisfaction.
1.1.1 What is Total Quality Management?
TQM is a philosophy that involves everyone in an organization and in a continual effort
to improve quality and achieve customer satisfaction (Stevenson, 2005).
TQM is an approach to management that is characterized by the principles of customer
focus, continuous improvement, and teamwork. It is broadly agreed that TQM is an
integrated management philosophy aimed at continuously improving the performance of
products, processes, and services to achieve and surpass customer expectations (Chin et
al., 2002; Bayazit and Karpak, 2006). Berry (1991) defined TQM process as a total
corporate focus on meeting and exceeding customers' expectations and significantly
reducing costs resulting from poor quality by adopting a new management system and
corporate culture. In other word, TQM is a customer-oriented approach which uses
statistical tools and techniques, follows the plan-do-check-act scheme, implements the
measures, and continues to improve procedures for smooth fulfillment of plans.
The TQM approaches are listed as follows: (Stevenson, 2005)
1. Find out what the customer wants
2. Design a product or service that meets or exceeds customer wants
3. Design processes that facilitates doing the job right at the first time
4. Keep track of results
5. Extend these concepts to suppliers.
1.2 Statement of Problem
Although TQM’s tools and techniques have been recognized useful, in practice, there
are many difficulties for people to implement them effectively and efficiently
(Shamsuddin and Masjuki, 2003).
1. 2
The previous studies have shown that some firms fail when they implement TQM (Boje
and Winsor, 1993; Spector and Beer, 1994) because the implementation of TQM cannot
be successfully done without the use of suitable quality management methods (Sitkin et
al., 1994; Wilkinson et al., 1998; Zhang, 2000) such as tools and techniques of quality.
Bunney and Dale (1997) have concluded that the usage and selection of quality
management’s tools and techniques are vital to support and develop the quality
improvement process. Shamsuddin and Masjuki (2003) also supported that TQM can not
be ensured without the application of the appropriate tools and techniques.
Some disruptions when companies use unsuitable tools and techniques are
dissatisfaction which is in opposite of the ultimate goal of TQM, wasted time and lose of
money. Therefore, planning and selecting of the appropriate tools and techniques
considering on their application, performance priority, and relationship can prevent these
losses.
On the other hand, Tari and Sabater (2004) verified the necessary of implementation of
quality tools and techniques for TQM improvement.
It seems that most researches focus on soft TQM (Samson and Terziovski, 1999), often
they investigated on analyzing the relationships between the implementation of different
elements and several types of performance (Huarng and Chen, 2002; Kaynak, 2003), and
also some of them examined the effect of organizational environment on TQM
performance (Fuentes et al., 2004). There are no proper investigations on TQM’s
1. 3
techniques and tools for a specific industry to identify which of them are critical to be
implemented or which of them have a more performance to achieve higher customer
satisfaction. Also the other problem is that the firms do not know exactly which of tools
and techniques have more relationship and interrelationship to implement to each other.
The most literatures (Clinton et al., 1994; Perdomo-Ortiz et al., 2005) on TQM are
focused on the elements of TQM and the approaches taken to assure a successful
implementation (McQuater et al., 1995). However, less attention has been devoted to
identify critical factors or significant criteria for evaluating and offering a reasonable
priority of implementation of TQM tools and techniques.
There have been numerous studies on analyzing critical factors for implementing the
quality management’s concepts successfully and its influence upon performance (Saraph
et al., 1989; Badri et al., 1995; Black and Porter, 1996; Chin et al., 2002; Motwani,
2001), but there are few studies which have identified critical factors/criteria for
assessing performance of TQM’s tools and techniques. On the other hand, there are a lot
of studies upon tools and techniques of quality separately (Akao, 1997) but about their
relationship and performance priority; there is not any exact framework or proper
guideline to aware quality manager how to implement them.
Establishing and implementing of the QMS need to use the tools and technique of TQM
correctly and they should be economical. The importance of systematic and objective
analysis and the need of quality management tools in TQM have been felt more and also
a range of new tools has been developed (Shamsuddin and Masjuki, 2003).
1. 4
Today the implementation management and planning are very critical for top manager in
order to attain a higher revenue or satisfaction. It is necessary to offer the critical
techniques and standardizing their implementation according to their importance and
relationship weight. Quality Management (QM) cannot be practiced effectively and
efficiently without using a set of tools and techniques and also the choice of any tool is
not just automatic, rather situation specific. Some tools and techniques are essential in
any manufacturing firm – small, medium or large, if the management really wants to
handle the business professionally (Shamsuddin and Masjuki, 2003). In fact, any tool or
technique should not be taken in isolation for use without a strategic disposition.
1.3 Research Objectives
The main objectives of this research are:
1. To determine the distributive weight of TQM’s CTs with respect to their
performance to fulfill both internal and external customer’s satisfaction
2. To determine the relationship and interrelationship between TQM’s CTs
1.4 Benefit and Significance of the Study
Today companies in order to survive in a competitive market, need to re-engineering
business process and measuring performance systems. It is very significant to accurately
apply the TQM’s tools and techniques to fulfill customer needs because customers
expectations are always changing at a fast pace. On the other hand, the integrated model
is a valuable method for achieving this goal.
1. 5
Some benefits of this study are listed in the following:
1. Improve management decision making
2. Optimize the sequencing and ranking of usage of TQM tools and techniques
3. Institutionalize implementation of TQM tools and techniques
4. Identify the weaknesses especially in training of TQM’s CTs and the strengths
by regarding to TQM’s CTs applications.
This study has recognized the urgency of grading of TQM’s CTs with respect to their
performance weight. The study has identified the usage and implementation of TQM’s
CTs with respect to each factor that the factors have been selected according to both
internal and external customers values. On the other hand, Priority and relationship
between the TQM’s CTs have a significant role to increase customer satisfaction.
Mainly the study has focused on hard TQM especially critical techniques of TQM.
According to Chin et al., (2002) “tools and techniques” is one of the critical sub-factors
of “systems and techniques”. On the other hand, “systems and techniques” is one of the
critical factors of TQM implementation. This study has examined the possibility of
designing an integrated implementation framework for showing the interrelationship and
performance weight of critical techniques in implementing of Total Quality
Management (TQM) that can be used as a benchmarking model for other automotive
companies.
1. 6