TQM Chapter 1

CHAPTER 01Introduction to Quality and Performance Excellence
TRUE/FALSE
1. The view of quality as the satisfaction of customer needs is often called fitness for use.
ANS: T
DIF: Difficulty: Easy
NAT: BUSPROG: Analytic
2. Since quality relates to goods or services, only for-profit organizations can benefit from adopting
performance excellence procedures.
ANS: F
3. Scientific management involved skilled craftspeople who served both as manufacturers and
inspectors, building quality into their products.
ANS: F
4. After World War II, the first country to adopt quality initiatives and improvement in industry was the
United States.
ANS: F
5. The Deming Prize was constituted by the United States to raise awareness of quality and recognize
national role models.
ANS: T
6. A successful organization is one which integrates quality principles with its mundane daily work
activities.
ANS: T
7. In quality control, tolerances are acceptable deviations from the values assigned to the targets.
ANS: T
8. Performance excellence can be defined as any primary or complementary activity that does not
directly produce a physical product.
ANS: F
9. A difference between service and manufacturing is that manufacturing is performed away from the
customer whereas customers are involved in the service process.
ANS: T
10. Not-for-profit organizations are adopting quality principles because of their impact on the bottom line.
ANS: F
11. From a total quality perspective, all strategic decisions a company makes are customer-
driven.
ANS: T
12. Total Quality views everyone inside the enterprise as a customer of an internal or external
supplier and a supplier of an external or internal customer.

ANS: T
13. Employee engagement is manifest by empowerment.

ANS: T
14. Competitive behaviorone person against another or one group against anotheris one of the basic
principles of TQ.
ANS: F
15. The traditional way of viewing an organization is by surveying the horizontal dimensionby keeping
an eye on an organization chart.
ANS: F
16. In terms of total quality management, continuous improvement refers only to breakthrough
improvement.
ANS: F
17. According to Noriaki Kanos three classes of needs, the required safety features in an
automobile are an example of a satisfier.

ANS: F
18. Process time refers to the time it takes to accomplish one cycle of a process.
ANS: F
19. A firm that is characterized by flexibility and short cycle times is considered to be agile.
ANS: T
20. Agency theory views the management system as one based on social and human values, whereas total
quality is based on an economic perspective.
ANS: F
21. Agency theory suggests that information may be concealed to advance self-interests.
ANS: T
22. Agency theory assumes that risks are to be minimized and shared between the two parties.
ANS: T
23. Leaders in agency theory provide a quality vision and play a strategic role in the organization.
ANS: F
24. In the organismic model of organizations, organizations are considered to be autonomous
entities.
ANS: F
25. In the organismic model of organizations, work is reduced to elementary tasks with a focus on
efficiency, conformity, and compliance.
ANS: F
26. The mechanical organizational model assumes that systems goals such as the need to survive displace
performance goals, such as profit.
ANS: F
27. The organismic model of organizations views an organization as a tool or a machine designed solely to
create profits for its owners.
ANS: F
28. In the cultural organizational model, managers relinquish control and share power in order to meet the
needs of the many individuals.
ANS: T
29. In the cultural organizational model, learning needs are driven not by adaptation to environmental
forces but in response to individual needs.
ANS: T
MULTIPLE CHOICE
1. The term _____ refers to an integrated approach to organizational performance management that
results in delivery of ever-improving value to customers and stakeholders, contributing to
organizational sustainability.
a.
b.
c.
d.
fitness for use

gap analysis
performance excellence
accreditation
ANS: C
2. Frederick W. Taylors concept of _____ greatly influenced the nature of quality in manufacturing
organizations.
a. scientific management
b. the Hawthorne effect
c. Theory X
d. the observer-expectancy effect
ANS: A
3. _____ introduced statistical quality control to Japanese workers after World War II as part of General
MacArthurs rebuilding program.
a. Edwards Deming and Joseph Juran
b. F.W. Taylor
c. Malcolm Baldrige and Henry Ford
d. Noriaki Kano
ANS: A
4. The prize constituted by Japan to recognize quality initiatives in business is named after _____.
a. Edwards Deming
b. Malcolm Baldrige
c. Frederick Taylor
d. Noriaki Kano
ANS: A
5. In 1987, Congress established the _____ to raise awareness of quality and recognize national role
models, spawning a remarkable interest in quality among American businesses.
a. Presidents Quality Award
b. Peak Performance Award
c. Deming Prize
d. Baldrige Award
ANS: D
6. In an ancillary manufacturing unit, the bolt manufacturing section has a value of 0.095 as the target,
0.005 as the tolerance. Which of the following is the acceptable range of values in production?
a. Between 9.500 and 1.005
b. Between 0.009 and 0.001
c. Between 0.900 and 0.010
d. Between 0.090 and 0.100
ANS: D
DIF: Difficulty: Moderate
7. As part of the evolving understanding of quality management, many began to use the term _____ to
contrast the difference between managing for quality in all organizational processes and focusing
solely on manufacturing quality .
a. micro-quality
b. strategic quality
c. Big Q
d. lead Q
ANS: C
8. _____ refer(s) to a products primary operating characteristics.

a. Benefits
b. Conformance
c. Aesthetics
d. Performance
ANS: D
9. _____ refers to the degree to which physical and performance characteristics of a product
match pre-established standards.

a.
b.
c.
d.
Reliability
Conformance
Features
Aesthetics
ANS: B
10. _____ is the subjective assessment of a product resulting from image, advertising, or brand
names.
a.
b.
c.
d.
Perceived quality
Reliability
Performance
Aesthetics
ANS: A
11. With respect to the quality dimensions of manufactured products, _____ refer(s) to a products primary
operating characteristics.
a. Reliability
b. Features
c. performance
d. durability
ANS: C
12. With respect to the quality dimensions of manufactured products, _____ refer(s) to the probability of a
products surviving over a specified period of time under stated conditions of use.
a. aesthetics
b. serviceability
c. Features
d. reliability
ANS: D
13. With respect to the quality dimensions of manufactured products, _____refer(s) to the amount of use
one gets from a product before it physically deteriorates or until replacement is preferable.
a. durability
b. aesthetics
c. Features
d. serviceability
ANS: A
14. With respect to the quality dimensions of manufactured products, _____ refer(s) to the ability to repair
a product quickly and easily.
a. durability
b. serviceability
c. conformance
d. Features
ANS: B
15. With respect to the quality dimensions of manufactured products, _____ deals with how a product
looks, feels, sounds, tastes, or smells.
a. serviceability
b. durability
c. performance
d. aesthetics
ANS: D
16. Which of the following is true of the service sector as opposed to manufacturing firms?
a. The output of a service firm is intangible.
b. A service firm considers that all customer needs are the same.
c. Service firms usually maintain inventory registers.
d. Service firms require a physical production site.
ANS: A
17. Which of the following is an example of a service provider?

a. A steel plant
b. A clothing manufacturer
c. A pharmaceutical company
d. A bank
ANS: D
18. _____ is an important dimension associated with service quality.

a. Aesthetics
b. Serviceability
c. Durability
d. Accuracy
ANS: D
19. The _____ is the highest award given to executive branch agencies for management excellence.
a. Presidents Quality Award
b. Malcolm Baldrige Award
c. Deming Prize
d. National Quality Improvement Award
ANS: A
20. Which of the following TQ principles was the TQ quality initially based on?
a. Emphasis on individual work
b. Continuous improvement
c. Employee focus
d. Quality variance
ANS: B
21. In 1992, the chairs and CEOs of nine major U.S. corporations in cooperation with deans of business
and engineering departments of major universities, and recognized consultants endorsed a definition of
_____ as a people-focused management system that aims at continual increase in customer satisfaction
at continually lower real cost.
a. business process reengineering
b. a quality circle
c. total quality
d. Six Sigma management
ANS: C
22. In a total quality environment, internal customers are the:

a. designated team members of the quality control team.
b. customers who are part of the product testing panel.
c. recipients of any work output.
d. immediate customers, but not the end users.
ANS: C
23. Customer engagement refers to:

a. organizations designing products and processes with the goal of maximising revenue from
individual customers.
b. organizations building relationships with customers so they will continue to use their goods
and services and actively advocate for and recommend them.
c. organizations customizing product and service features to meet the needs of individual
customers rather than mass-producing products.
d. customers proactively approaching organizations in order to suggest product ideas and
features for development.
ANS:
STA:
TOP:
KEY:
B
DISC: Operations Management
A-Head: Principles and Practices of Total Quality and Performance Excellence
Bloom's: Knowledge
24. A manager who is considered a Theory X manager is likely to believe that:

a. productivity is enhanced when employees make decisions on their own.
b. workers dislike work and require close supervision and control.
c. worker productivity improves when managers relax supervision.

d. employees are self-motivated and eager to take on challenges.
ANS: B
STA: DISC: Operations Management
25. According to McGregors _____, workers are self-motivated, seek responsibility, and exhibit a high
degree of imagination and creativity at work.
a. Theory Z
b. Theory Y
c. Theory X
d. Theory Q
ANS: B
26. Teamwork between top management and lower-level employees is called _____ teamwork.
a. vertical
b. interorganizational
c. horizontal
d. cross-functional
ANS: A
27. Teamwork within work groups and across functional lines is called _____ teamwork.
a. cross-training
b. interorganizational
c. horizontal
d. quality circle
ANS: C
28. Partnerships with suppliers and customers are called ______ partnerships.
a. horizontal
b. cross-functional
c. vertical
d. interorganizational
ANS: D
29. A(n) _____ is a sequence of activities that is intended to achieve some result.
a. process
b. array
c. cluster
d. symmetry
ANS: A
30. With respect to the systems approach to management, _____ refers to looking at an organization as a
whole and building on key business attributes, including core competencies, strategic objectives,
action plans, and work systems.
a. alignment
b. integration
c. sequence
d. synthesis
ANS: D
31. In the context of Noriaki Kanos classification of customer needs, _____ refer to those needs that are
expected in a product or service.
a. satisfiers
b. delighters
c. dissatisfiers
d. exciters
ANS: C
32. According to Noriaki Kanos classification of customer needs, _____ are the needs that customers say
they want.
a. satisfiers
b. dissatisfiers
c. delighters
d. exciters
ANS: A
33. According to Noriaki Kanos classification of customer needs, _____ new or innovative features that
customers do not expect in a product or service.
a. satisfiers
b. delighters
c. dissatisfiers
d. essentials
ANS: B
34. Sylvia orders a security system to be installed at her house. After placing the order, the company took
three days to install it. The time taken for the order to be delivered is referred to as:
a. execution gap.
b. cycle time.
c. performance gap.
d. turnaround time.
ANS: B
35. Agency theory makes the assumption that individuals in agency relationships are _____ and will
always take actions to enhance their self-interests.
a. utility-maximizers
b. negotiators
c. satisficers
d. adopters
ANS: A
36. In agency theory, _____ is a primary mechanism used by both parties to maintain and govern the
relationship.
a. autonomy
b. motivation
c. self-regulation
d. monitoring
ANS: D
37. In the _____ organizational model, work is reduced to elementary tasks with a focus on efficiency,
conformity, and compliance.
a. environmental
b. organismic
c. mechanistic
d. cultural
ANS: C
38. The _____ model assumes that systems goals, such as the need to survive, displace performance goals,
such as profit.
a. organismic
b. mechanistic
c. cultural
d. environmental
ANS: A
39. Total Quality shares the most similarities with the _____ organizational model.
a. cultural
b. environmental
c. mechanistic
d. organismic
ANS: D
40. The _____ model views an organization as a collection of cooperative agreements entered into by
individuals with free will.
a. mechanistic
b. cultural
c. organismic
d. environmental
ANS: B
ESSAY
1. What is performance excellence?
ANS:
The term performance excellence refers to an integrated approach to organizational performance
management that results in delivery of ever-improving value to customers and stakeholders,
contributing to organizational sustainability; improvement of overall organizational effectiveness and
capabilities; and organizational and personal learning. Performance excellence is a characteristic of
todays most outstanding organizations and is a requisite for providing high quality goods and services.
2. Briefly describe the quality dimensions of manufactured products.
ANS:
Manufactured products have several quality dimensions:
1) Performance: a products primary operating characteristics.
2) Features: the bells and whistles of a product.
3) Reliability: the probability of a products surviving over a specified period of time under stated
conditions of use.
4) Conformance: the degree to which physical and performance characteristics of a product match
preestablished standards.
5) Durability: the amount of use one gets from a product before it physically deteriorates or until
replacement is preferable.
6) Serviceability: the ability to repair a product quickly and easily.
7) Aesthetics: how a product looks, feels, sounds, tastes, or smells.
8) Perceived quality: subjective assessment resulting from image, advertising, or brand names.
3. Describe in brief the most important dimensions of service quality.
ANS:
The most important dimensions of service quality are the following:
1) Time: How much time must a customer wait?
2) Timeliness: Will a service be performed when promised?
3) Completeness: Are all items in the order included?
4) Courtesy: Do frontline employees greet each customer cheerfully?
5) Consistency: Are services delivered in the same fashion for every customer, and every time for
the same customer?
6) Accessibility and convenience: Is the service easy to obtain?
7) Accuracy: Is the service performed right the first time?
8) Responsiveness: Can service personnel react quickly and resolve unexpected problems?
4. What are the points organizations have to look into beyond product orientation to ensure service
quality?
ANS:
Service organizations must look beyond product orientation and pay significant attention to customer
transactions and employee behavior. Several points that service organizations should consider are as
follows:
1) The quality characteristics that a firm should control may not be the obvious ones.
2) Behavior is a quality characteristic.
3) Image is a major factor in shaping customer expectations of a service and in setting standards by
which customers evaluate that service.
4) Establishing and measuring service levels may be difficult.
5) Quality control activity may be required at times or in places where supervision and control
personnel are not present.
5. How is empowerment related to employee engagement?
ANS:
Employee engagement simply means that workers have a strong emotional bond to their organization,
are actively involved in and committed to their work, feel that their jobs are important, know that their
opinions and ideas have value, and often go beyond their immediate job responsibilities for the good of
the organization. Engagement is often manifest by empowerment, which simply means that people
have the authority to make decisions based on what they feel is right, have control over their work,
take risks and learn from mistakes, and promote change.
6. Describe the different types of continuous improvement.
ANS:
Continuous improvements within an organization may be of several types:
1) enhancing value to the customer through new and improved products and
services;
2) improving productivity and operational performance through better work
processes and reductions in errors, defects, and waste;
3) improving flexibility, responsiveness, and cycle time performance; and
4) improving organizational management processes through learning.
7. Describe the three levels at which data and information support analysis is disseminated and aligned
within an organization.
ANS:
At the work level, data provide real-time information to identify reasons for variation, determine root
causes, and take corrective action as needed. At the process level, operational performance data such
as yields, cycle times, and productivity measures help managers determine whether they are doing the
right job, whether they are using resources effectively, and whether they are improving. At the
organization level, quality and operational performance data from all areas of the firm, along with
relevant financial, market, human resource, and supplier data, form the basis for strategic planning and
decision making.
8. Define the four stages in a learning cycle.
ANS:
A learning cycle has four stages:
1. planning,
2. execution of plans,
3. assessment of progress, and
4. revision of plans based upon assessment findings.
9. Illustrate the differences between TQ and agency theory.
ANS:
The following are the major differences between TQ and agency theory:
1) TQ views the management system as one based on social and human values, whereas
agency theory is based on an economic perspective that removes people from the equation.
2) Agency theory assumes an inherent conflict of goals between agents and principals, and
that agent goals are aligned with principal goals through formal contracts. In TQ, everyone in
the organization shares common goals and a continuous improvement philosophy.
3) Sharing information to achieve these goals is fundamental to TQ, whereas agency theory
suggests that information may be concealed to advance self-interests.
4) TQ takes a long-term perspective based on continuous improvement, whereas agency
theory focuses on short-term achievement of the contract between the principal and agent.
5) In TQ, risk taking is necessary in order to innovate, whereas agency theory assumes that
risks are to be minimized and shared between the two parties.
6) Finally, TQ leaders provide a quality vision and play a strategic role in the organization;
leaders in agency theory develop control mechanisms and engage in monitoring.
10. Describe the three major organizational models.
ANS:
Three major organizational models that management theorists have studied are the mechanistic,
organismic, and cultural models of organizations.
1) The mechanistic model views an organization as a tool or a machine designed solely to create
profits for its owners. Work is reduced to elementary tasks with a focus on efficiency, conformity, and
compliance.
2) The organismic model views organizational systems as living organisms that depend on their
environments for resources and adjust the behavior of their parts to maintain the properties of the
whole within acceptable limits. This model assumes that systems goals, such as the need to survive,
displace performance goals, such as profit.
3) The cultural model views an organization as a collection of cooperative agreements entered into by
individuals with free will. The organizations culture and social environment are enacted or socially
constructed by organization members. From the perspective of this model, the goal of an organization
is to serve the diverse needs of all whom it affectsits stakeholders.

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CHAPTER 01Introduction to Quality and Performance Excellence

DIF: Difficulty: Easy

NAT: BUSPROG: Analytic

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supplier and a supplier of an external or internal customer.

DIF: Difficulty: Easy

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13. Employee engagement is manifest by empowerment.

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automobile are an example of a satisfier.

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24. In the organismic model of organizations, organizations are considered to be autonomous

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fitness for use