2.4 Total Quality Management (TQM)

	It is an approach that seeks to improve quality and performance which will meet or exceed customer
	expectations.

	Total quality management has evolved from the quality assurance methods that were first developed around the
	time of the First World War.

The war effort led to large scale manufacturing efforts that often produced poor quality.

After World War Two, the industrial manufacturers in Japan produced poor quality items.

	In a response to this, the Japanese Union of Scientists and Engineers invited Dr. Deming to train engineers in
	quality processes.

	By the 1950's quality control was an integral part of Japanese manufacturing and was adopted by all levels of
	workers within an organization.

By the 1970's the notion of total quality was being discussed.

	In the next decade more non-Japanese companies were introducing quality management procedures that based
	on the results seen in Japan.

Quality costs can be divided into two categories: quality control cost and quality failure cost.

2.4 Total Quality Management (TQM)

Quality control cost consists of: prevention cost and appraisal cost.

Quality failure costs consist of internal and external failure costs.

	Prevention costs are all costs incurred in preventing poor quality from occurring. Appraisal costs are incurred in
	the process of discovering defects.

	Internal failure costs are associated with discovering poor product quality before the product reaches the
	customer site. External failure costs are associated with quality problems that occur at the customer site
	resulting in customer loss.