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INDUS UNIVERSITY

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 Course Name

• Teacher • Muhammad Umair Khalid

• Semester • Fall 2023
• Credit Hours • 03

Faculty of Management Sciences, Indus University 3

 Assessment

• Report • 10
• Quiz • 10
• Presentation • 10

Faculty of Management Sciences, Indus University 4

PERFORMANCE MEASURES FOR TQM

WEEK 10

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 Total Quality Management (TQM)
Where we have been?
 Total Quality Management (TQM)
Where we are going?

Performance Measures (PM)

• The sixth and final concept of Total Quality Management

• It plays an important part in the overall success or failure of a business

organization.

• Performance measures quantitatively tell us something important about

our products, services, and the processes that produce them.

• They are a tool to help us understand, manage, and improve what our
organizations do.
Performance measures let us know:

1) How well we are doing

2) If we are meeting our goals

3) If our customers are satisfied

4) If our processes are in statistical control

5) If and where improvements are necessary.

As a process, performance measurement is not simply concerned with collecting
data associated with predefined a performance goal or standard. Performance
measurement is better thought of as an overall management system involving
prevention and detection aimed at achieving conformance of the work product or
service to your customer's requirements. Additionally, it is concerned with
process optimization through increased efficiency and effectiveness of the
process or product. These actions occur in a continuous cycle, allowing options
for expansion and improvement of the work process or product as better
techniques are discovered and implemented.
• Production activities uses measures such as
defects per million, inventory turns, and on time delivery.

• Service activities uses measures such as billing errors, sales per

square feet, engineering
changes, and activity time.
"Managing a business organization without performance measures is like a
captain of a ship navigating in the middle of the ocean without any
instrumentation. The captain of would most likely end up travelling circle
without a port of destination, as would a business organization."
Essential Elements of Performance
Measures

1. Objectives
2. Typical measurement
3. Criteria
4. Characteristics
1. Objectives

Performance measurements as used to achieve one or more of the

following six objectives:

a. Establish baseline measures and reveal trends

b. Determine which processes need to be improved
c. Indicate process gains and losses
d. Compare goals with actual performance
e. Provide information for individual and team evaluation
f. Manage by fact rather than gut felling
2. Typical Measurement

What should be measured is frequently asked by managers and teams.

a. Human resources
b. Customers
c. Production
d. Research development
e. Suppliers
f. Marketing/Sales g. Administration
3. Criteria

All business organizations have some measurements in place that can be

adopted for TOM. In order to evaluate the existing measures or add new ones,
there are seven criteria to be followed:

a. Simple
b. Few in number
c. Developed by users
d. Relevance to customer
e. Improvement
f. Cost
4. Characteristics

- One of the seven basic characteristics is used to measure the

performance of a particular process or function.

a. Quantity - most common measures; refers to how many units a

production or business produces
b. Cost - amount of resources required to produce a given output
c. Time
d. Accuracy - number of non-conformances in
the output
e. Function
f. Aesthetics - how the product looks, feels,
sounds, tastes, or smells and is quite
subjective
g. Service - Service activity
 Reference

TEXT BOOKS:
Subburaj Ramasamy Total Quality Management, Tata McGraw-Hill Publishing Company
Limited, Delhi

John S. Oakland Total Quality Management, ButterworthHeinmann, An Imprint of Elsevier,

Linacre house, Jordan Hill, Oxford, 200 Wheeler Road, Burlington.

REFERENCE:
1. Foster, T. S. Managing quality: An integrative approach . Upper Saddle, NJ: Prentice –
Hall.
2. 2. Sadikoglu, E. Total quality management: Context and performance. The Journal of
Academy of Business, Cambridge, 5 (1/2), 364- 366.

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Thank You

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