TQM vs. Six Sigma

Instructor: Deborah Schell

Deborah teaches college Accounting and has a master's degree in Educational Technology.

Customers expect quality when they make a purchase, and companies that satisfy this expectation will generate profits. In this lesson, we will examine the TQM and Six Sigma quality methods.

What Is TQM?

Let's meet Mr. Lawnder who manufactures laundry detergent. He recently attended a conference where the speaker discussed two methods to improve product quality, TQM and Six Sigma. He wonders if these methods could help him improve his product quality and generate more profit for his company. Let's see if we can help Mr. Lawnder.

TQM, or total quality management, is a process that focuses on continuous improvement over a long period of time and involves all areas of the company, not just the manufacturing department. For Mr. Lawnder, this would include employees in administration, marketing, distribution, and communication departments, as well as manufacturing. Instead of improving the quality of an individual product, TQM's goal is to change the attitude and culture of the company to focus on satisfying customer needs.

The TQM philosophy consists of:

  • Customers
  • Continuous improvement
  • Empowering employees
  • Using tools to evaluate quality, understand findings, and develop solutions
  • Designing products to satisfy customer needs and expectations
  • Building quality into the process
  • Managing supplier quality

Mr. Lawnder must continually gather information about his customers' needs to ensure he is offering products they want. For example, he could ask his customers to complete surveys or participate in focus groups to ensure his products are meeting their expectations.

TQM focuses on continuously improving products versus fixing problems with a particular product and moving on to another one. Mr. Lawnder could benchmark his processes with a competitor that he views as a quality leader. Benchmarking is a method of comparing your company and its processes with a competitor to identify best practices and areas where your company could improve or is already doing well.

In TQM, every employee has a role to play in improving quality. Mr. Lawnder could implement an incentive program to reward employees who identify and provide solutions for quality problems.

Employees need guidance in identifying quality problems, as well as evaluating and generating solutions for them. Mr. Lawnder could implement tools such as checklists to identify defects that occur frequently and flowcharts that are diagrams of the steps in a process so employees could identify potential problem areas.

It is less costly to identify and fix a problem before a company releases a product versus after it is available for sale to customers. TQM focuses on identifying problems at the beginning of the process, so the company can correct them, instead of finding them during a quality control review, where they need to be thrown away or reworked. Quality control involves inspecting finished products to ensure they meet company specifications.

Inspecting goods received from suppliers is time-consuming and costly. Mr. Lawnder could negotiate with his suppliers and build TQM concepts into the contracts, so materials arriving at his company meet the same quality standards he has for his company's products.

What Is Six Sigma?

Six Sigma is a data-driven method that focuses on reducing the number of defects in manufactured products to 3.4 per million opportunities. Companies use it for new product development or for existing products that don't meet customer expectations. Six Sigma has two methods, DMADV that companies use when developing new products and DMAIC that companies use for existing products that need small changes.

The five steps in the DMADV process are:

  • Define
  • Measure
  • Analyze
  • Design
  • Verify

Mr. Lawnder could apply the DMADV method when developing his new line of eco-friendly detergent. Mr. Lawnder and his dedicated project team would set goals for the project (define stage) and identify customer requirements (measure stage). The team would brainstorm to identify potential alternatives that would satisfy the customer requirements defined in the measure stage (analyze stage).

Once the team selects an option, it would design the proces,s taking the customers' needs into consideration (design stage). Lastly, the project team would evaluate the product to ensure it meets customers' specifications and goals set earlier in the project (verify stage).

The five steps in Six Sigma's DMAIC process are:

  • Define
  • Measure
  • Analyze
  • Improve
  • Control

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