UNIT 2

Leadership Strategic quality planning, Quality councils- Employee

involvement Motivation, Empowerment, Team and Teamwork, Quality
circles
process

Recognition

and

Reward,

improvement-PDCA

cycle,

Performance

appraisal-continuous

5S-Kaizen-Supplier

Partnership-

Partnering, Supplier Selection, Supplier Rating.

DEFINITION OF LEADERSHIP
According to Peter Drucker, Leadership is the lifting of mans visions to
higher sights, the raising of mans performance to a higher standard, the
building of mans personality beyond its normal limitations.
According to Keith Davis, Leadership is the ability to influence others to seek
defined objectives enthusiastically. It is the human factor which binds as group
together & motivates it towards goals.
Who is a leader?
A leader is one who knows the way, goes the way and shows the way.
CHARACTERISTICS OF QUALITY LEADERS
1. Customers first
2. Value people
3. Build supplier partnership
4. Empower people
5. Strive for excellence
6. Demonstrate involvement / commitment
7. Explain & deploy policy
8. Improve communication
9. Promote teamwork
10. Benchmark continuously
11. Establish system
12. Encourage collaboration
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LEADERSHIP ROLES

Innovator
Negotiator
Producer
Director
Coordinator
Checker

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 Stimulator
Monitor

STRATEGIC QUALITY PLANNING

It sets the long term direction of the organization in which it wants to
proceed in future.
Can be defined "As the process of deciding on objectives of the
organization, on changes on this objective, on the resource used to obtain these
objectives and on the policies that are to govern the acquisition use and
disposition of these resources"
Goals Long Term Planning. For example, win the war
Objectives Short Term Planning. For example, capture the bridge

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QUALITY COUNCILS
The quality council includes CEO and Senior managers of the
functional areas -research,manufacturing,finance,sales
,marketing etc. and one co-ordinator and a union
representative.
Duties- To develop the Quality statements eg. Vision, Mission,
Quality policy statements, Core values etc.
To develop strategic long-term plans and annual quality
improvement programme.
Make a quality training programme
Monitor the costs of poor quality.
Determine the performance measures for the organisation
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 Always find projects that improve the processes and produce

customer satisfaction.
Establish work-group teams and measure their progress.
Establish and review the recognition and reward system for
the TQM system
___________________________________________________________________________
__________________________
EMPLOYEE INVOLVEMENT
It is the total involvement from every person at all levels in the
organization
ASPECTS OF EMPLOYEE INVOLVEMENT
1. Employee motivation
2. Employee Empowerment
3. Teams and Team work
4. Recognition and Reward Schemes
5. Performance Appraisal
1. EMPLOYEE MOTIVATION
It is the process of stimulating people or attempting to influence other to
do your will or accomplish desire goals through the possibility of reward.
Motivation may be defined as those forces that cause people to behave in
certain ways. Motivation encompasses all those pressures and influences that
trigger, channel, and sustain human behavior.
According to Koontz and O'Donnell, "Motivation is a class of drives, needs,
wishes and similar forces".

Improves employee involvement

Reduces absenteeism and increases turn over

Promotes job satisfaction

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THEORIES OF MOTIVATION
MASLOWS NEED HIERARCHY THEORY
Maslow assumed that people are motivated to satisfy various needs and
that these needs can be arranged in a hierarchy of importance. As
shown in Figure, Maslow's hierarchy of needs assumes there are five need
levels.
The physiological needs for such things as food, water and air represent
basic issues of survival and biological function. In organizational settings,
physiological needs are generally satisfied by adequate wages and the work
environment itself, which provides restrooms, adequate lighting, comfortable
temperatures, and ventilation.
The security needs - the needs for a secure physical and emotional
(Physiological) environment. Examples include the desire for adequate
housing and clothing and the need to be free from worry about money and
job security.
Social needs are related to social processes. It is the needs to associate
with other people and be accepted by them; to love and be loved. They
include the need for love and affection and the need to be accepted by one's
peers.
Esteem needs actually comprise two different sets of needs: the need for a
positive self-image and self-respect and the need for recognition and respect
from others.
Self-actualization needs/Self-realization/Self-fulfillment these involve
realizing one's potential for continued growth and individual development.
The self-actualization needs are perhaps the most difficult for a manager to
address.
For example, for accomplishing what one is capable of accomplishing, for
becoming what one is capable of becoming? A musician must make music,
an artist must paint, a poet must write if he is to be ultimately happy.
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HERZBERGS TWO FACTOR THEORY

1. Motivation Factor: People are motivated by recognition, responsibility,
achievement, advancement and the work itself. These are called as
motivators
2. Dissatisfies or Hygiene Factor: Low salary, minimal fringe benefits, poor
working conditions, ill defined organizational policy, mediocre technical
supervision are dissatisfies which implies they are preventable.

HYGIENE FACTORS AND MOTIVATION FACTORS

Hygiene Factors: There are 10 Hygiene Factors such as company policy and
administration, technical supervision, interpersonal relationship with
superiors, interpersonal relationship with subordinates, interpersonal
relationship with peers, salary, job security, personal life, working
conditions and status. These are not intrinsic parts of a job, but they are
related to conditions under which a job is performed. They produce no growth
in a workers output; they prevent losses in workers performance due to work
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restrictions. Any increase beyond this level will not provide any satisfaction to
the employees; however, any cut below this level will dissatisfy them. As such,
these are also called as dissatisfiers.

Motivation Factors/Satisfiers: There are 6 Motivational factors such as

achievement, recognition, advancement, work itself, possibility of growth
and responsibility. An increase in these factors will satisfy the employees;
however, any decrease will not affect their level of satisfaction. Since, these
increase level of satisfaction in the employees; these can be used in motivating
them for higher output.

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EMPLOYEE EMPOWERMENT
It is an environment in which people have the ability, the confidence and
the commitment to take his responsibility and ownership to improve the
process and initiate the necessary steps to satisfy customer requirements
within well-defined boundaries in order to achieve organizational values and
goals.
Job Enrichment: Is expanding content of the Job.
Job Empowerment: Is expanding the context of the job.
Job Enlargement: Job enlargement changes the jobs to include more
and/or different tasks. Job enlargement should add interest to the work but
may or may not give employees more responsibility.
Job Rotation: Job rotation moves employees from one task to another. It
distributes the group tasks among a number of employees.

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Job

Enrichment:

Job

enrichment

allows

employees

to

assume

more

responsibility, accountability, and independence when learning new tasks or to

allow for greater participation and new opportunities.
Delegation: Assignment of authority by the superior to his subordinates, to
enable the subordinate to carry out specific activities.
GENERAL

PRINCIPLES

OR

CHARACTERISTICS

FOR'

EMPOWERING

EMPLOYEES
1. Tell people what their responsibilities are.
2. Given the authority equal to the responsibility assigned to them.
3. Set standards of excellence.
4. Give them knowledge information and feedback.
5. Trust them and treat them with dignity and respect.
CONDITIONS TO CREATE THE EMPOWERED ENVIRONMENT
1. Everyone should understand the need to change
2. The system need to change to new paradigm.
3.

The organization must provide information, education, and skill to its

employees.
TEAMS AND TEAMWORK
A team can be defined as a group of people working together to achieve

common objectives or goals.

Team work is the cumulative actions of the team during which each
member of the team subordinates his individual interest and opinions for the
fulfilling of objectives of the group.
BENEFITS OF TEAM WORK
Improved

solutions

to

quality

problems,

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communication and integration.

TYPES OF TEAMS

ownership

of

solutions,

Process improvement team: Involved in improvement of sub processes or

processes. Usually it has 6-10 members. Disbanded occurs when the objective
is reached.
Cross functional team: 6-10 members temporary team. Members are Top
management level from various functional areas of management. Discuss
complex problems and break down into smaller parts to refer it to various
departmental teams for further solution.
Natural work team: Not voluntary and the total work unit is part of the team.
Manager also a part of the team and the management selects the projects to be
improved. Managers must also ensure that the entire team is comfortable with
each other.
Self directed / self managed work team: Extension of natural work teams
but here the group of individuals is empowered not only to do work but manage
it. No manger will present but a coordinator (Which will be normally rotated
among members) will be appointed. Additional responsibilities of the team
hiring/ dismissal, performance evaluation, customer relations, supplier
relations, recognition/rewards and training.
CHARACTERISTICS OF SUCCESSFUL TEAMS
1. Sponsor: In order to have effective liaison with quality council, there should
be sponsor. The sponsor is a person from the quality council, he is to
provide support to the organization
2. Team Charter: A team charter is a document that defines the teams
mission boundaries, the background of the problem, the teams authority
and duties and resources. It also identifies the members and their assigned
roles leader, recorder, time keeper and facilitator.
3. Team Composition: Not exceeding 10 members except natural work team
and self managed teams.
4. Training: The team members should be trained in the problem solving
techniques team dynamics and communication skills.

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5. Ground Rules: The team should have separate rules of operation and
conduct. Ground rules should be discussed with the members, whenever
needed it should be reviewed and revised.
6. Clear objectives, Accountability:

Periodic status report should be

submitted to quality council for review.

7. Well defined decision procedure, Resources: Adequate information should
be provided.
8. Trust by the management, Effective problems solving: Not by hunches
or quick fires.
9. Open communication, Appropriate Leadership, Balanced participation
and Cohesiveness

TEAM MEMBER ROLE

Leader, Facilitator (One who helps the team gets started in the stages),
Recorder, Time keeper and Team member.
DECISION MAKING METHODS
Non decision, Unilateral decision, Handclasp decision (Two members with
a good idea of the subject decide), Minority-rule decision, Majority rule
decision, Consensus (Not everyone need to accept, But everyone should be
willing to implement)
ELEMENTS OF EFFECTIVE TEAM WORK
Regular

scheduling

with

fixed

time

limit,

purpose,

role

and

responsibilities, activities, decision, results and recognition.

TEAM MANAGEMENT WHEEL
To make a lean more effective a team management wheel has been
evolved. The activities are advising, innovating, promoting,

developing,

organization, producing, inspecting, maintaining and linking. The roles of

wheel are advisor, explore, organizer and controller.
STAGES OF TEAM DEVELOPMENT
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Forming stage- Initial stage with only group of individuals and no team work.
Team purpose, roles are created.
Storming Stage -Initial agreement roles are challenged. Hostilities, emerge
which may be resolved.
Norming Stage-Formal- informal relations get established.
Performing Stage -Team operates in a successful manner with trust,
openness, healthy conflict and decisiveness among the members.
Maintenance stage Functioning should match with time.
Evaluating Stage Evaluating the team performance.
TEN COMMON PEOPLE PROBLEMS
Floundering,

overbearing

participants,

Dominating

participants,

reluctant participants, unquestioned acceptance of opinions as facts, rush to

accomplish, Attribution, Discounts and plops, Wanderlust, Feuding team
members.

BARRIERS TO TEAM PROGRESS

Insufficient training, Incompatible rewards and compensation, First-line
supervisor resistance, Lack of planning, Lack of management support, Access
to information systems, Lack of union support, Project scope too large, Project
objectives are not significant, No clear measures of success and No time to do
improvement work.
RECOGNITION AND REWARD
Recognition is a process whereby management shows acknowledgement
(Verbal or written) of an employee outstanding performance. Recognition is a
form of employee +ve motivation.
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Reward is a tangible one such as increased salaries, commission, cash bonus,

gain sharing etc., to promote desirable behavior. It can be even theatre tickets,
dinner for two, a small cash awards, etc.,
The employees are recognized to improve their morale, show the company's
appreciation for Better Performance, create satisfied and motivated workplace
and stimulate creative efforts.
INTRINSIC VS EXTRINSIC REWARDS
INTRINSIC REWARDS
Related

to

EXTRINSIC REWARDS

feeling

of Related to pay or compensation

accomplishment or self worth

1. Non

monetary

recognition

to

achievement

issues

forms

of

1. Profit sharing

acknowledge

2. Gain sharing

of

3. Employment security

quality

improvement goals

4. Compensation time

2. Celebrations to acknowledge
achievement

of

quality

improvement goals
3. Regular

by

systems
6. Quality based performance

expression

appreciation

5. Individual based performance

of

appraisals

managers

and leaders to employees to

acknowledge achievement of
quality improvement goals
4. 360o performance appraisals
feedback

from

co-workers,

subordinates or customers is
incorporated

into

performance appraisal
5. Formal

suggestion

system

available for individuals to

make

quality

improvement

suggestion
6. Developmental

based

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performance appraisals
7. Quality based promotion
STEVE

SMITHS

TWENTY

DIFFERENT

WAYS

TO

RECOGNIZE

THE

EMPLOYEES

Send thank letter whenever possible

Develop behind the scenes award
Create the best ideas of the year booklet
Feature the quality team of the month and put their picture in prominent

place
Honor peers by recognizing them
Allow people to attend meetings in your name when you are not available
Involve teams with external customers and suppliers by visiting them
Invite a team for coffee or lunch whenever possible
Create a visibility will displaying posters, pictures, to thank the

contributions of employee
Credit the team to higher authorities when their ideas are accepted
Take interest in employees development
Get the team picture in company newspaper
Mention the ideas of others during your meetings, so that they are

recognized
Write a letter of praise to contributed team member and copy to boss
Ask people to help you with the project which is difficult but challenging
Send a team to special seminars, workshops to cover topics they are
really interested in
Ask your boss to send a letter of acknowledgement and thanks
Honor outstanding contribution with awards
Have a stock of small gifts to give to people on the spot whom you catch
doing things right
Promote or nominate for promotion, those people who contribute most
PERFORMANCE APPRAISAL
Performance

Appraisal

is

the

systematic

evaluation

of

the

performance of employees and to understand the abilities of a person for

further growth and development.
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OBJECTIVES OF PERFORMANCE APPRAISAL

Identifying employees for salary revision, promotion, transfer, demotion, lay
off
To determine training needs of employee
To take organizational inventory of people
To know personal strength and weakness of individuals
To validate the selection procedure
APPRAISAL

PROCESS/PROCESS

OF

DEVELOPING

EFFECTIVE

PERFORMANCE MANAGEMENT

PERFORMANCE APPRAISAL METHODS/TECHNIQUES COMMONLY USED

FOR PERFORMANCE MEASURE
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With the evolution and development of the appraisal system a number of

methods or techniques of performance appraisal have been developed. They can
be classified as
Traditional method
Modern method
TRADITIONAL METHOD
1. Graphic Scale Method / Linear Rating Scale Method
Individual performance is compared with the absolute standard. The
judgment about the performance is recorded on the scale. It is an oldest
and frequently used method. The appraisers are supplied with printed forms
one for each. These forms contain a number of objectives, behavior trait and
characters. These forms contain rating scales. Points are given to each item
and they are added up to find the overall performance. Managers are ranked
based on the total points they obtain and these are plotted in the graph.
Performance Appraisal at Indian Hotels
Superior

Above

Average

Average
Job Knowledge
Quality
(Accuracy,
Neatness)
Quantity
(Output of good
work)
Personal
Appearance
(Cleanliness,
Neatness)
Ability

for

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Below Average Comments

Teamwork
Common Sense
Initiative
(Interested

in

making
improvement,
seeks

addl.

Responsibility)
Manners
and
Obedience
Health level and
absenteeism
2. Ranking method
The

managers

are ranked

from

best

to worst

based

on some

characteristics. The rater first finds the manager with highest performance
and the manager with lowest performance. Rates given by the manager,
the former as the best and the later as the poor. Thus all the employees in
a group are given ranks.
Ranking can be easy and inexpensive, but its reliability and validity may
be open to doubt. It is possible that low ranker in one group may turn to be
superstar in another group. The limitation of the ranking method is that the
size of the difference between individual being ranked is not well defined.
3. Paired Comparison Method
This method is simple. Under this method the appraiser ranks the
manager based on his performance in comparing with all the others in the
group one at a time. It will be effective if the numbers of managers are less.
The total number of comparison is given by the formula

[N (N-1)]/2.

The limitation is that managers are simply compared with each other on the
total performance rather than specific job criteria.
4. Forced Distribution Method
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It develops to prevent the rater from rating too high or too low. Under this
method the rater after assigning the points to the performance of each
manager has to distribute the rating in a pattern to confirm frequency
distribution. It eliminates central tendency and leniency biases. This method
is based on the rather questionable assumption that all group of manager will
have the same distribution of excellent, average and poor.

5. Check List Method

The checklist is a simple rating technique in which the supervisor is
given a list of statements and is asked to check if the statements represent the
characteristics and performance of each manager.
Is he or she interested in the job?
Is he or she regular on the job?
6. Critical Incident Method
The critical incidents method of employee assessment has generated a lot
of interest these days. The approach focuses on certain critical behaviors of
an employee that make all the difference between effective and noneffective performance of a job. The incidents are recorded as and when they
occur.
7. Essay Appraisal Form
In this, the rater is asked to write an essay about the managers
strength and weakness.

Based upon that they are ranked. The major

drawback of this method is that it is time consuming and subjective.

MODERN METHODS
1. BARS (Behaviorally Anchored Rating Scales)
The bars method combines elements of the traditional rating scales
and critical incident method - effective and ineffective behaviors are
described more objectively. The method employs individuals who are familiar
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with a particular job to identify its major components. They then rank and
validate specific behavior for each of the components.
The various steps involved in constructing BARS
Collect critical incidents
Identify performance dimensions
Reclassification of incidents.
Assigning scale values to the incidents
Producing the final instrument.
2. Assessment center
This method of appraising was first applied in German army in 1930.this
is not a technique of performance by itself. It uses procedures that incorporate
group and individual exercises. These exercises are designed to simulate the
type of work, which the candidate will be expected to do. They participate in
in-basket exercises, work groups, computer simulations, role-playing and
other similar activities. Their performance in the situational exercises is
observed and evaluated by a team of trained assessors.
3. Management By Objective
MBO requires the management to set specific, tangible and measurable
goals with each manager and then periodically discuss the latters progress
towards these goals. This technique emphasizes participative management
viz. goals that are agreed upon both by the managers and their superiors.
It is a kind of goal setting and appraisal program involving six steps
Set the organizations goals
Set departmental goals
Discuss departmental goals
Define expected results
Performance reviews
Provide feedback
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4. Psychological Appraisal
It is conducted to assess the employees behavioral and psychological
aspect. It consists of in-depth interviews, psychological tests and discussion
reviews. It is useful for decision making with regard to placement, career
planning and training of managers.
5. 360-Degree Feedback
Where multiple raters are involved in evaluating performance, the
technique is called 360-degree appraisal. The 360-degree technique is
understood as systematic collection of performance data on an individual
or group, derived from a number of stakeholders. The stakeholders are the
immediate supervisors, team members, customers, peers, and self.
CONTINUOUS PROCESS IMPROVEMENT (CPI)
Concept: TQM has been defined as a philosophy based on quest for progress
and continual improvement in the areas of cost, reliability, quality, innovation,
efficiency and business effectiveness.
Definition: It is a continuous learning process which never stops and is
cyclic and iterative (say repeatedly).
To do CPI, we have different approaches such as Juran Trilogy, PDSA cycle,
Kaizen and 5S concept.
INPUT / OUTPUT PROCESS MODEL
The process refers to business and production activities of an
organization. Example Purchasing, Engineering, Marketing and Accounting

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BASIC WAYS TO IMPROVE PROCESS

To reduce resources
To reduce errors
To meet exceed customer needs
To make process safer
To make process more satisfying to the person doing it.

PDSA CYCLE
It is also called as Deming Cycle or Deming Wheel. Developed by Walter
A. Shewart and popularized by Edward Deming

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PLAN
Identify the problem, plan and opportunities
Observe and analyze
Isolate the real causes
Determine corrective actions
DO
Prepare
Apply
Check application
STUDY / CHECK
Check results
Compare with goals

ACT
Standardize and consolidate
Prepare next stage of planning
Explain the seven phases of PDSA cycle for problem solving.
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a) Identify the opportunity

b) Analyze the process
c) Develop the optimal solutions
d) Implement
e) Study the results
f) Standardize the solution
g) Plan for the future
5S HOUSE KEEPING
This is a house keeping technique used to establish and maintain a
productive and quality environment in an organization. This method is invented
in Japan which will give safer, more efficient and more productive operation
results in boosting of morale of workers, job involvement and satisfaction and
ownership of their responsibilities.
JAPANESE TERM

ENGLISH

MEANING

EQUIVALENT

Cleaning Throw away all

SEIRI

Tidiness or Sort

rubbish unrelated materials

in the work place
Arranging Set everything

SEITON

Orderliness or Arrange

in proper place for quick

retrieval and storage

SEISO
SEIKETSU

Cleanliness or Clean
Up
Systematize
Standardization

Sweeping Clean the work

place,

everything

without

fail
or Maintaining Cleanliness
Standardizing the way of
maintaining cleanliness

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Self Discipline Practice

SHITSUKE

5S daily. Make it a way of

Discipline

life.

This

also

means

commitment

KAIZEN
Japanese word means continuous improvement or improvement over
improvement - continuous improvement in small increments that make the
process more efficient, effective, controllable and adequate.
KAIRYO
Western

philosophy

improvement

through

improvement in one or two great jumps

KAIZEN VS KAIRYO
KAIZEN

KAIRYO

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Page 25

innovation,

i.e.,

It

is

through It is obtained by technological or

achieved

conventional

know

how

and organizational break through.

PDCA.
It is employee oriented.

It is technology oriented.

It requires little investment but It requires large investment but

great effort to maintain.
It

involves

company.

everybody

little effort to maintain.

in

the It involves a selected few experts

and researchers.

It requires recognition of effort It is motivated by expected results.

before results.

SUPPLIER PARTNERSHIP
A commitment to continuous quality improvement cannot be translated
into reality without treating supplier as partner.
PRINCIPLES OF CUSTOMER / SUPPLIER RELATION
Both the customer and the supplier are fully responsible for the control
quality
Both the customer and the supplier should be independent of each other
and respect each others independence
The customer is responsible for providing the supplier with clear and
sufficient requirements so that the supplier can know precisely what to
produce
Both the customer and the supplier should enter into an non adversarial
contract with respect to quality, quality, price, delivery method and terms of
payments
SUPPLIER PARTNERING

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It is defined as a continuing relationship, between a buying firm and

supplying firm, involving a commitment over an extended time period, an
exchange of information, and acknowledgement of the risks and rewards of the
relationship.
BENEFITS OF SUPPLIER PARTNERING
Improved Quality
Reduced cost
Increased Productivity
Increased efficiency
Increased market share
Increased opportunity for innovation
Continuous improvement of products/services.
BASIS OF SUPPLIER SELECTION
Cost, Quality, Delivery, Reliability, Management compatibility, Goal
congruence and Strategic direction of supplier firm.
STAGE IN SUPPLIER SELECTION & EVALUATION
Survey stage, enquiry stage, negotiation and selection stage, experience
stage.
The supplier should understand and appreciate the management philosophy
of the organization
The supplier should have a stable management system
The supplier should maintain high technical standards and have the
capability of dealing with future technological innovation
The supplier should provide those raw materials and parts required by the
purchaser and those supplied meet the quality specifications
The supplier should have the capability to produce the amount of
production needed
The supplier should not breach the corporate secrets
The supplier should be easily accessible in terms of transportation and
communication
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 The supplier should be sincere in implementing the contract provisions

The supplier should have an effective quality system and improvement
program such as ISO / QS 9000
The supplier should have a track record of customer satisfaction and
organization credibility
SUPPLIER RATING
Also referred as score card system, is used to obtain and overall rating of
supplier performance based on quality, price, performance and production
capability
OBJECTIVES OF SUPPLIER RATING
Obtain an overall rating of supplier performance ensure completer
communication with suppliers - provide each supplier about the details of
problems for corrective action and - maintain and improve the partnering
relationship between the customer and the supplier.

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