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 There are 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

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 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 management. 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.

The influence of quality thinking has spread to non-traditional applications outside of

walls of manufacturing, extending into service sectors and into areas such as sales,
marketing and customer service.[2]

[edit] Principles

Quality management adopts a number of management principles[3] that can be used by

top management to guide their organizations towards improved performance. The
principles include:

[edit] Customer focus

Since the organizations depend on their customers, therefore they should understand
current and future customer needs, should meet customer requirements and try to
exceed the expectations of customers.[4] An organization attains customer focus when
all people in the organization know both the internal and external customers and also
what customer requirements must be met to ensure that both the internal and external
customers are satisfied.[5]

[edit] Leadership
Leaders of an organization establish unity of purpose and direction of it. They should
go for creation and maintenance of such an internal environment, in which people can
become fully involved in achieving the organization's quality objective.[4]

[edit] Involvement of people

People at all levels of an organization are the essence of it. Their complete
involvement enables their abilities to be used for the benefit of the organization.[4]

[edit] Process approach

The desired result can be achieved when activities and related resources are managed
in an organization as process.[4]

[edit] System approach to management

An organization's effectiveness and efficiency in achieving its quality objectives are

contributed by identifying, understanding and managing all interrelated processes as a
system.[4]

[edit] Continual improvement

One of the permanent quality objectives of an organization should be the continual

improvement of its overall performance.[4]

[edit] Factual approach to decision making

Effective decisions are always based on the data analysis and information.[4]

[edit] Mutually beneficial supplier relationships

Since an organization and its suppliers are interdependent, therefore a mutually

beneficial relationship between them increases the ability of both to add value.[4]

These eight principles form the basis for the quality management system standard
Six Sigma is a business management strategy originally developed by Motorola, USA
in 1986.[1][2] As of 2010, it is widely used in many sectors of industry, although its use
is not without controversy.

Six Sigma seeks to improve the quality of process outputs by identifying and
removing the causes of defects (errors) and minimizing variability in manufacturing
and business processes.[3] It uses a set of quality management methods, including
statistical methods, and creates a special infrastructure of people within the
organization ("Black Belts", "Green Belts", etc.) who are experts in these methods.[3]
Each Six Sigma project carried out within an organization follows a defined sequence
of steps and has quantified financial targets (cost reduction or profit increase).[3]

The term Six Sigma originated from terminology associated with manufacturing,
specifically terms associated with statistical modelling of manufacturing processes.
The maturity of a manufacturing process can be described by a sigma rating
indicating its yield, or the percentage of defect-free products it creates. A six sigma
process is one in which 99.99966% of the products manufactured are statistically
expected to be free of defects (3.4 defects per million). Motorola set a goal of "six
sigma" for all of its manufacturing operations, and this goal became a byword for the
management and engineering practices used to achieve it.

Six Sigma doctrine asserts that:

• Continuous efforts to achieve stable and predictable process results (i.e.,

reduce process variation) are of vital importance to business success.
• Manufacturing and business processes have characteristics that can be
measured, analyzed, improved and controlled.
• Achieving sustained quality improvement requires commitment from the
entire organization, particularly from top-level management.

Features that set Six Sigma apart from previous quality improvement initiatives
include:

• A clear focus on achieving measurable and quantifiable financial returns from

any Six Sigma project.[3]
• An increased emphasis on strong and passionate management leadership and
support.[3]
• A special infrastructure of "Champions," "Master Black Belts," "Black Belts,"
"Green Belts", etc. to lead and implement the Six Sigma approach.[3]
• A clear commitment to making decisions on the basis of verifiable data, rather
than assumptions and guesswork.[3]

The term "Six Sigma" comes from a field of statistics known as process capability
studies. Originally, it referred to the ability of manufacturing processes to produce a
very high proportion of output within specification. Processes that operate with "six
sigma quality" over the short term are assumed to produce long-term defect levels
below 3.4 defects per million opportunities (DPMO).[7][8] Six Sigma's implicit goal is
to improve all processes to that level of quality or better.
One key innovation of Six Sigma involves the "professionalizing" of quality
management functions. Prior to Six Sigma, quality management in practice was
largely relegated to the production floor and to statisticians in a separate quality
department. Formal Six Sigma programs adopt a ranking terminology (similar to
some martial arts systems) to define a hierarchy (and career path) that cuts across all
business functions.

Six Sigma identifies several key roles for its successful implementation.[13]

• Executive Leadership includes the CEO and other members of top

management. They are responsible for setting up a vision for Six Sigma
implementation. They also empower the other role holders with the freedom
and resources to explore new ideas for breakthrough improvements.
• Champions take responsibility for Six Sigma implementation across the
organization in an integrated manner. The Executive Leadership draws them
from upper management. Champions also act as mentors to Black Belts.
• Master Black Belts, identified by champions, act as in-house coaches on Six
Sigma. They devote 100% of their time to Six Sigma. They assist champions
and guide Black Belts and Green Belts. Apart from statistical tasks, they spend
their time on ensuring consistent application of Six Sigma across various
functions and departments.
• Black Belts operate under Master Black Belts to apply Six Sigma methodology
to specific projects. They devote 100% of their time to Six Sigma. They
primarily focus on Six Sigma project execution, whereas Champions and
Master Black Belts focus on identifying projects/functions for Six Sigma.
• Green Belts are the employees who take up Six Sigma implementation along
with their other job responsibilities, operating under the guidance of Black
Belts.

Some organizations use additional belt colours, such as Yellow Belts, for employees
that have basic training in Six Sigma tools.
Since the late 1980s, firms around the world have launched Total Quality
Management (TQM) programs in an attempt to retain or regain competitiveness in
order to achieve customer satisfaction in the face of increasing competition from
around the world in this era of globalization. TQM is an integrative philosophy of
management for continuously improving the quality of products and processes. [1]

TQM functions on the premise that the quality of the products and processes is the
responsibility of everyone who is involved with the creation or consumption of the
products or services offered by the organization. In other words, TQM capitalizes on
the involvement of management, workforce, suppliers, and even customers, in order
to meet or exceed customer expectations. Considering the practices of TQM as
discussed in six empirical studies, Cua, McKone, and Schroeder (2001) identified the
nine common TQM practices as cross-functional product design, process
management, supplier quality management, customer involvement, information and
feedback, committed leadership, strategic planning, cross-functional training, and
employee involvement. [2]
Lean manufacturing or lean production, often simply, "Lean," is a production
practice that considers the expenditure of resources for any goal other than the
creation of value for the end customer to be wasteful, and thus a target for
elimination. Working from the perspective of the customer who consumes a product
or service, "value" is defined as any action or process that a customer would be
willing to pay for. Basically, lean is centered on preserving value with less work. Lean
manufacturing is a management philosophy derived mostly from the Toyota
Production System (TPS) (hence the term Toyotism is also prevalent) and identified
as "Lean" only in the 1990s.[1][2] It is renowned for its focus on reduction of the
original Toyota seven wastes to improve overall customer value, but there are varying
perspectives on how this is best achieved. The steady growth of Toyota, from a small
company to the world's largest automaker,[3] has focused attention on how it has
achieved this.

Lean manufacturing is a variation on the theme of efficiency based on optimizing

flow; it is a present-day instance of the recurring theme in human history toward
increasing efficiency, decreasing waste, and using empirical methods to decide what
matters, rather than uncritically accepting pre-existing ideas. As such, it is a chapter in
the larger narrative that also includes such ideas as the folk wisdom of thrift, time and
motion study, Taylorism, the Efficiency Movement, and Fordism. Lean
manufacturing is often seen as a more refined version of earlier efficiency efforts,
building upon the work of earlier leaders such as Taylor or Ford, and learning from
their mistakes.
Premium Pricing.

Use a high price where there is a uniqueness about the product or service. This
approach is used where a a substantial competitive advantage exists. Such high prices
are charge for luxuries such as Cunard Cruises, Savoy Hotel rooms, and Concorde
flights.

Penetration Pricing.

The price charged for products and services is set artificially low in order to gain
market share. Once this is achieved, the price is increased. This approach was used by
France Telecom and Sky TV.

Economy Pricing.

This is a no frills low price. The cost of marketing and manufacture are kept at a
minimum. Supermarkets often have economy brands for soups, spaghetti, etc.

Price Skimming.

Charge a high price because you have a substantial competitive advantage. However,
the advantage is not sustainable. The high price tends to attract new competitors into
the market, and the price inevitably falls due to increased supply. Manufacturers of
digital watches used a skimming approach in the 1970s. Once other manufacturers
were tempted into the market and the watches were produced at a lower unit cost,
other marketing strategies and pricing approaches are implemented.

Premium pricing, penetration pricing, economy pricing, and price skimming are the
four main pricing policies/strategies. They form the bases for the exercise. However
there are other important approaches to pricing.

Psychological Pricing.
This approach is used when the marketer wants the consumer to respond on an
emotional, rather than rational basis. For example 'price point perspective' 99 cents
not one dollar.

Product Line Pricing.

Where there is a range of product or services the pricing reflect the benefits of parts of
the range. For example car washes. Basic wash could be $2, wash and wax $4, and the
whole package $6.

Optional Product Pricing.

Companies will attempt to increase the amount customer spend once they start to buy.
Optional 'extras' increase the overall price of the product or service. For example
airlines will charge for optional extras such as guaranteeing a window seat or
reserving a row of seats next to each other.

Captive Product Pricing

Where products have complements, companies will charge a premium price where the
consumer is captured. For example a razor manufacturer will charge a low price and
recoup its margin (and more) from the sale of the only design of blades which fit the
razor.

Product Bundle Pricing.

Here sellers combine several products in the same package. This also serves to move
old stock. Videos and CDs are often sold using the bundle approach.

Promotional Pricing.

Pricing to promote a product is a very common application. There are many examples
of promotional pricing including approaches such as BOGOF (Buy One Get One
Free).

Geographical Pricing.

Geographical pricing is evident where there are variations in price in different parts of
the world. For example rarity value, or where shipping costs increase price.

Value Pricing.

This approach is used where external factors such as recession or increased

competition force companies to provide 'value' products and services to retain sales
e.g. value meals at McDonalds.
Reverse engineering is the process of discovering the technological principles of a
human made device, object or system through analysis of its structure, function and
operation. It often involves taking something (e.g., a mechanical device, electronic
component, or software program) apart and analyzing its workings in detail to be used
in maintenance, or to try to make a new device or program that does the same thing
without using or simply duplicating (without understanding) any part of the original.

Reverse engineering has its origins in the analysis of hardware for commercial or
military advantage.[1] The purpose is to deduce design decisions from end products
with little or no additional knowledge about the procedures involved in the original
production. The same techniques are subsequently being researched for application to
legacy software systems, not for industrial or defence ends, but rather to replace
incorrect, incomplete, or otherwise unavailable documentation.[2]
1. Idea Generation is often called the "fuzzy front end" of the NPD process
o Ideas for new products can be obtained from basic research using a
SWOT analysis (Strengths, Weaknesses, Opportunities & Threats),
Market and consumer trends, company's R&D department,
competitors, focus groups, employees, salespeople, corporate spies,
trade shows, or Ethnographic discovery methods (searching for user
patterns and habits) may also be used to get an insight into new
product lines or product features.
o Lots of ideas are being generated about the new product. Out of these
ideas many ideas are being implemented. The ideas use to generate in
many forms and their generating places are also various. Many reasons
are responsible for generation of an idea.
o Idea Generation or Brainstorming of new product, service, or store
concepts - idea generation techniques can begin when you have done
your OPPORTUNITY ANALYSIS to support your ideas in the Idea
Screening Phase (shown in the next development step).
2. Idea Screening
o The object is to eliminate unsound concepts prior to devoting resources
to them.
o The screeners should ask several questions:
 Will the customer in the target market benefit from the
product?
 What is the size and growth forecasts of the market
segment/target market?
 What is the current or expected competitive pressure for the
product idea?
 What are the industry sales and market trends the product idea
is based on?
 Is it technically feasible to manufacture the product?
 Will the product be profitable when manufactured and
delivered to the customer at the target price?
3. Concept Development and Testing
o Develop the marketing and engineering details
 Investigate intellectual property issues and search patent data
bases
 Who is the target market and who is the decision maker in the
purchasing process?
 What product features must the product incorporate?
 What benefits will the product provide?
 How will consumers react to the product?
 How will the product be produced most cost effectively?
 Prove feasibility through virtual computer aided rendering, and
rapid prototyping
 What will it cost to produce it?
o Testing the Concept by asking a sample of prospective customers what
they think of the idea. Usually via Choice Modelling.
4. Business Analysis
o Estimate likely selling price based upon competition and customer
feedback
 o Estimate sales volume based upon size of market and such tools as the
Fourt-Woodlock equation
o Estimate profitability and break-even point
5. Beta Testing and Market Testing
o Produce a physical prototype or mock-up
o Test the product (and its packaging) in typical usage situations
o Conduct focus group customer interviews or introduce at trade show
o Make adjustments where necessary
o Produce an initial run of the product and sell it in a test market area to
determine customer acceptance
6. Technical Implementation
o New program initiation
o Finalize Quality management system
o Resource estimation
o Requirement publication
o Publish technical communications such as data sheets
o Engineering operations planning
o Department scheduling
o Supplier collaboration
o Logistics plan
o Resource plan publication
o Program review and monitoring
o Contingencies - what-if planning
7. Commercialization (often considered post-NPD)
o Launch the product
o Produce and place advertisements and other promotions
o Fill the distribution pipeline with product
o Critical path analysis is most useful at this stage
8. New Product Pricing
o Impact of new product on the entire product portfolio
o Value Analysis (internal & external)
o Competition and alternative competitive technologies
o Differing value segments (price, value, and need)
o Product Costs (fixed & variable)
o Forecast of unit volumes, revenue, and profit
Industrial Licensing Policy

Industrial Licenses are regulated under the Industries (Development & Regulation)
Act, 1951. Industrial Licence is granted by the Government of India in the Secretariat
for Industrial Assistance (SIA) on the recommendation of the Licensing
Committee.With progressive liberalization and deregulation of the economy the
requirement of industrial licensing have been substantially reduced. At present
industrial licence for manufacturing is required only for the following:
i. Industries retained under compulsory licensing,
ii. Manufacture of items reserved for small scale sector by non-SSI units; and
iii. When the proposed location attracts locational restriction
iv. Industries reserved for the Public Sector

The following industries require compulsory industrial license:

• Distillation and brewing of alcoholic drinks

• Cigars and cigarettes of tobacco and manufactured tobacco substitutes
• Electronic Aerospace and defence equipment: all types
• Industrial explosives including detonating fuses, safety fuses gun powder,
nitrocellulose and matches
• Hazardous chemicals
(a) Hydrocyanic acid and its derivatives
(b) Phosgene and its derivatives
(c) Isocyanates and di-isocyanates of hydrocarbon, not elsewhere specified
(example: Methyl Isocyanate);
• Drugs and Pharmaceuticals (according to modified Drug Policy issued in
September, 1994 and subsequently amended in February, 1999)