#How to Manage Quality in your Small Business# By SN Panigrahi, Essenpee Business Solutions, SN Panigrahi, Quality is Everywhere & In Everyday Life, Why Business Need for Quality, Why Small Businesses Scare of Quality, Why Quality, What is Meant by Quality?, Definition of Quality, 5S, What Does 5S Stand For?, 5S: Before & After, Lean Practices, 5 Lean Principles, 8 Wastes, Kaizen,

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SN Panigrahi is a Versatile Practitioner, Strategist, Energetic Coach, Learning Enabler & Public Speaker.
He is an International-Corporate Trainer, Mentor & Author
He has diverse experience and expertise in Project Management, Contract
Management, Supply Chain Management, Procurement, Strategic
Sourcing, Global Sourcing, Logistics, Exports & Imports, Indirect Taxes –
GST etc.
He had done more than 150 Workshops on above
Published more than 500 Articles; More than 60 Youtube Presentations
He is an Engineer + MBA +PGD ISO 9000 / TQM with around 29 Yrs of
Experience
He is a certified PMP® from PMI (USA) and become PMI India
Champion
Also a Certified Lean Six Sigma Green Belt from Exemplar Global
Trained in COD for 31/2 Years on Strategy & Leadership
GST Certified – MSME – Tech. Dev. Centre (Govt of India)
ZED Consultant – Certified by QCI – MSME (Govt of India)
Member Board of Studies, IIMM
Co-Chairman, Indirect Tax Committee, FTAPCCI
Empanelled Faculty in NI MSME
He has shared his domain expertise in various forums as a speaker & presented a number of papers in various national and
international public forums and received a number of awards for his writings and contribution to business thoughts.
SN Panigrahi
9652571117
snpanigrahi1963@gmail.com
Hyderabad

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Quality looks a lot like Part of our Routine Life. Looking at your daily life with the quality
filter makes you realize that quality and your life are linked.
When you go to the grocery store to purchase grapes, for example, you may taste one
to see if the bunch is ripe. In doing so, you apply sampling with accepted quality level,
meaning you believe the taste of the sample should reflect the quality of the entire
bunch.
When you try on clothes before purchasing them, you’re applying a mix of quality
control, self-inspection, auditing and the calculation of the quality cost.
Quality control occurs when you check for defects, spots or stains on the clothing. Self-
inspection is trying it on to see whether it fits properly. You audit the clothes by
comparing your self-inspection results to your expectations.
The final decision is the calculation of the quality cost by deciding how the overall
inspection of the item compares to its cost and your budget.

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“Every company, no matter how small you are or what industry
you’re in, can benefit from Quality”.
But How?
Whether it Costs More?
How can you begin implementing Quality initiatives in your small
company?

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Quality is one of the most Important Challenges Facing a Business
 Quality Products help to Maintain Customer Satisfaction and Loyalty - Critical to
Satisfied Customers
 Markets are more Competitive: Customers are more Knowledgeable – Demanding –
Higher Quality - Meet Customer Expectations
 Meet or Exceed Industry Standards
 Quality Reduces the Risk and Cost of Complain about Poor Quality
 Manage Costs Effectively
 Better Quality Create an Advantage over its Competitors
 Companies can build a Reputation & Recognition for Higher Quality

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Small organizations have their own set of strengths and weaknesses, notably scarce
resources (not only financial, but also knowledge and personnel resources) and
personalized management.
Quality management (QM) is comparatively well explored among large companies, but
not so among small ones for many reasons:
(1)Small organizations are often family-owned;
(2)Small business leaders are often more focused on day-to-day operations as
opposed to management models and strategic management systems;
(3)Small businesses have less money to spend on training; and
(4)Their competitors generally operate the way they do – without using management
models and implementing improvement systems.
(5)Also, entrepreneurs who develop small businesses usually have little desire to
establish routine processes and procedures.

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Product Needs & Requirements
Functionality - Features
Price – Value for Money
Convenience – Availability & Delivery
Experience
Design – Appearance - Aesthetics
Reliability / Durability
Performance – Fit for Purpose
Efficiency
Compatibility
Service Needs & Requirements
Communication & Information
Transparency
Fairness – Perceived Service Quality
Empathy
Variety & Options
Accessibility
Interactions & Feedback
Responsiveness - Promptness of Service
Quality is about Meeting the Needs & Expectations of Customers
If a Product or Service meets all those Needs - then it passes the quality test
If it doesn't, then it is sub-standard

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Quality is the ability of a product or service to consistently meet or exceed
customer expectations.
“Meeting Customer Needs” (John Oakland)
Quality is “conformance to requirements” (Philip B. Crosby 1984)
Quality is “fitness for use” (Joseph Juran 1986)
Quality of a product or services is its ability to satisfy the needs and
expectations of the customer

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The totality of features and characteristics of a product or service that bear on
its ability to satisfy stated or implied needs (IS0 8402) (1986)
Quality ManagementThe degree of conformance of all the relevant features
and characteristics of the product (or service) to all aspects of a customers
needs, limited by the price and delivery he or she will accept. (Groocock
1986)

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Fitness for Use or
Purpose
Do First Time
Right
Do the Right
Things at Right
Time
Just What
Consumers WantFeatures that
Meet Consumer
Needs & Give him
Satisfaction
Free from Defects
or Deficiencies
Conforming to
Standards
Value for Money

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Quality is based on 5 characteristics (Juran 1988)
• e.g. strength & hardnessTechnological
• e.g. taste, beauty, statusPsychological
• e.g. reliability & maintainabilityTime-oriented
• e.g. guarantee provisionsContractual
• e.g. courtesy, honestyEthics

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Quality Management: – Concerned with
controlling activities with the aim of ensuring
that products and services are fit for their
purpose and meet the specifications
Two Main Approaches
– Quality Control : The process of inspecting products to ensure that they meet the
required quality standards
– Quality Assurance : The processes that ensure production quality meets the
requirements of customers

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“You can definitely implement Quality System even if you’re a one-man shop,”
Here are tips for implementing Quality Systems easily and effectively in your small
business:
 Strategize with Goals in Mind - Clarify Vision, Mission, and Values
 Standardize Systems with Processes – Write Down & Follow these Processes
 Identify Key Customer Group
 Focus on What the Customers Want – Define Quality
 Train the Staff - Orientation towards Customers
 Strong Leadership – Focus & Guidance
 Create Check Points - Identify Factors by which to Measure Success - Identify
Critical Success Factors (CSF)
 Solicit Customer Feedback
 Develop Improvement Plan & Strive for Continuous Improvement
Once you’ve got your guidelines, processes and checkpoints in place, all you have to do is
follow your own process for ensuring a quality product, service

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Simple & Easy to Practice
HOUSEKEEPING TECHNIQUE
Low Cost & High Impact
Productivity and Safety Improves
Create a better working environment and a
consistently high quality process based system

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Before the homeowners get organized, their lives are
characterized by undue complications and hassles— they are
constantly searching for such things as misplaced keys, paying
late fees because they misplaced bills, running late because their
children cannot find their homework or tripping over toys
that were not put away.
Similar types of organization problems that rob us of valuable time
at home exist in the workplace.
Such problems are exacerbated in business because there are
larger numbers of people working together and countless hours of
time engaged in these very costly nonvalue adding activities.

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5S is a system for organizing spaces Lean & Clean so work can be performed efficiently,
effectively, and safely.
This system focuses on putting everything where it belongs and keeping the workplace
clean, which makes it easier for people to do their jobs without wasting time or risking injury.
The philosophy of 5S represents a way of focusing and thinking in order to better organize
and manage workspace, specifically by eliminating the 8 Wastes as defined by the Lean
Manufacturing system.
It is one of the most widely used and fundamental components of Lean Manufacturing. Its
simple, common-sense application is highly effective and reliable as a stabilizing force in
Lean strategies.
A Successful 5S implementation will improve workplace safety, develop self-esteem
among employees & Improve Performance

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Developed by the Japanese, 5S was originally intended for manufacturing but works just as well in an
office environment or administrative environment or in any workplace.
Though 5S system sounds so simple that people often dismiss its importance, however, the fact remains
that a neat and clean facility:
 Has Higher Productivity.
 Better Machine Maintenance & Produces Fewer Defects.
 Reduces Waiting Time & Waste Elimination.
 Increased Efficiency
 Safety & Security
 Low Implementation Cost for High-Impact Performance
 Development of a Collaborative Mindset Among co-workers

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Any Problem such as a Loose Bolt or
Leaking Oil etc could be Easily Seen
Equipment's are Clean and Well
Maintained

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Leads to Reduced Down Time & Higher Workstation Efficiency
Operators Spend Less Time Looking for Items
Tools and Materials are Conveniently Located with Markings &
Systematically Arranged for the most Efficient and Effective Retrieval

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Improves Company Image
Leads to Greater Well Being and Increased Motivation
A clean and Tidy Workplace

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CREATES WORKPLACE OWNERSHIP
Clear Vision & Better Management of Work Place
Visual Control to See the Abnormalities
Simple Signals that Provide an Understanding of the Condition (Normal / Abnormal)
A Look at the Process Reveals its Direction (Right/Wrong)
5S : VISUAL MANAGEMENT SYSTEM

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Time Saving - Quick Retrieval
Accidents & Mistakes Minimized
Improves Quality & Productivity
Health and Safety is ensured
Smooth Working - No Obstruction
No Deviation - No Problem
A Clean Workplace : Results in a Place Easier to Manage
Everyone Knows where the Goods are Supposed To Be

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Improves Quality Consciousness Across the Organization
CONTINUOUS QUALITY IMPROVEMENT
LEAN MANUFACTURING
5S : Passion of Cleanliness and Orderliness became a Hallmark
FOUNDATION OF QUALITY PHILOSOPHY

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5S Term Definition Solgan
1 Sort
(Seiri)
Remove all unnecessary items from
the workplace - old catalogs, old
samples, components, obsolete
documents, obscure pieces of
equipment
Sort, Clear, Declutter and Classify
When in doubt,
move it out!
2 Set in Order
(Seiton)
Create a specific location for
everything that remains so that easy to
locate, and in a logical order in relation
to the workflow
A place for
everything and
everything in its
place!
3 Shine
(Seiso)
Clean and Inspect the workplace
This makes it easier to identify
problems.
Clean and Inspect!
4 Standardize
(Seiketsu)
Standardize best Practices
Make the rules and follow them.
Make the Rules
and Follow them!
5 Sustain
(Shitsuke)
Make 5S part of daily work culture.
Audit Regularly to Maintain Standards.
Don't slip back into
old habits!

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This step focuses on the elimination of any unnecessary workplace clutter. In a
process called “red tagging,” all workplace items are sorted through, with a red
tag placed on any that are not absolutely necessary for completing a task. Once
tools, supplies, materials and equipment have been tagged, they are then
relocated to a holding area for a follow up evaluation. Items that are only seldom
used can be stored closer in proximity to the workspace, while obsolete clutter
should be discarded.
Sorting’s benefits include: a more effective use of space, simplified tasks, a
reduction in hazards, and a significant decrease in distracting clutter.

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Set in Order – The goal of this step is to examine methods of storage that are
effective and efficient, sometimes referred to as “visual management,” and then
create a work environment that is organized, ergonomic, uncluttered and easily
navigable. Some questions to ask during this step might be: Which specific items
are needed to perform a task? How many items need to be readily accessible
and where should they be located?
The methodical storage of materials means that every item has a predetermined
location where it will remain until it used, and then it will be returned
immediately following its use. Labels and color coding are also helpful techniques
to use in this step. With an organized and efficient use of storage, everyone is
easily able to locate important items and enjoy a less stressful work
environment.

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With the clutter gone and the storage organized, the next step is to properly
and thoroughly clean the work area every day. This step is critical as a way of
sustaining the improvements begun in the Sort and Set phases.
All storage areas, machines, equipment, tools and work surfaces must be
cleaned and checked regularly.
Employees will feel more comfortable in this clean and uncluttered
environment, which could also lead to increased ownership of the
organization’s goals and vision.

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Now that the first three steps are in play, it’s time to standardize these new
practices. All employees need to be included in the creation of a set of
standards that will become the new norm for the workspace.
When these new standards and best practices are implemented, the old habits
will soon die out and be replaced by the more efficient patterns of behavior.
New standards, however, will probably require some oversight and
enforcement until they are habitual; reminders such as visuals and emails are
effective tools to help these new standards become set in stone.

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The final step of 5S is certainly the most challenging: remaining disciplined
enough to sustain the positive changes made in the first three steps. It is
critical that the new system be maintained or the efforts and costs put into
developing the new system will be pointless.
By putting a formal system in place that includes regular training and
communication, employees will be able to comfortably conform to the
company’s 5S procedures.

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Before After
1.Inventory stacked far out of
reach
2.Unused older inventory
3.Safety hazard; boxes stacked
in aisles
4.No discernable organization
such as barcoding, inventory
dating, color coding, or naming
convention
5.Trash and debris allowed to
accumulate
1.Uniform bins and racking
2.Date tracking of inventory
3.Bin contents are labeled
4.Bins, racks, and floors are kept
clean and in good repair
5.Lighting in facility is sufficient
6.Racks are low enough that
ladders are not required to
access inventory

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Lean Principles
Lean is a business philosophy, not just a tool set or method for improvement. This business philosophy was
derived from Toyota experiences and in particular from its Toyota Production System (TPS). The focus is on
reducing waste in all business processes. The result is reduction of cost and lead-time as well as an
increase in quality.
Lean Manufacturing – Toyota Production System
Following the 1973 energy crisis, Toyota was the only Japanese firm resisting by working efficiently and
effectively. The company managed to overcome this crisis by deploying a culture of empowerment. Toyota
employees were embarked in a continuous improvement journey and were working to drive inefficiencies out of
work processes. Results are reduction of manufacturing lead-time and costs as well as improving quality and
customer satisfaction.
This is a study of the automobile industry (Womack, J. P., Jones, D. T. & Roos, D., 1990) that introduced this
business philosophy lean production for the first time to the western world. The Toyota success story base
waste elimination has since kept all industries enthusiast about the lean approach.
To be Lean is to provide what is needed, when it is needed, with the minimum amount of materials,
equipment, labour, and space.
It was also a breakthrough step from mass production to lean production, from a push system to a pull system.
SN Panigrahi

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Lean Manufacturing Benefits
“Lean manufacturing uses less of everything compared with mass production - half
the human effort in the factory, half the manufacturing floor space, half the
investment in tools, half the engineering hours to develop a new product in half the
time. Also it requires keeping far less than half the needed inventory on site and
results in fewer defects.”
 The typical short-term improvements are:
 Inventory reduction
 Lead-time reduction
 Productivity/Capacity increase
 Quality improvement
 Floor space reduction
 Cost reduction
 Value added/person
 Improved profit margins
 Overall effective efficiency
SN Panigrahi

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Introduction
This workshop explores the principle of Lean Manufacturing as applied to project
management processes. This will be an introduction to the advantages of applying
Lean tools and techniques to Projects. It is time for the world of projects to reap
the same kind of benefits that Lean has achieved for manufacturing - maximize
value and minimize waste.
Lean is a Continuous
Improvement
Strategy focused on
Maximizing Value &
Minimizing Waste in
all the Business
Processes or
Products
SN Panigrahi

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Waste means Any
Activity or Features
that Doesn’t Add
Value to the Product
or Service, from the
Point of View of the
Customers
Examples of Waste
 Unnecessary Travel like Driving or Ridding
 Waiting for Approval
 Unnecessary Movement like Bending or
Stretching
 Producing more than Required etc…. Etc….
SN Panigrahi

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Objectives
Proper use of Lean techniques will result in cutting waste in your projects,
producing greater customer satisfaction and improved profit margin. This will be
accomplished by examining how companies like Toyota and Motorola achieved
excellence through the Lean methodology.
The goal of this workshop is to provide participants with an understanding of how
using Lean principles can help ensure project success.
The objectives are:
 Identify the Five Principles of Lean
 Discover how Lean Principles can be applied to Project Management
 Determine the Various Kinds of Waste that Exist in Projects
SN Panigrahi

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Womack and Jones (2003) established Five Key aspects in lean
methodology that are necessary to avoid waste. Lean thinking provides a
method to specify value, align the actions that create value according to the
optimal sequence, carry out these activities without interruption when
someone requests them, and perform them with increasingly effectiveness.
SN Panigrahi

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Value-Adding (VA)
These Activities are Essential for Conversion / Changes of Product / Service and Valuable for
the Customer. You would look at Maximizing this Category as these are Providing Customer
Value (Form, Fit, Function).
Necessary but Non-Value Adding (NNVA)
Category that has potential for elimination in the future (with identified improvements) but
can't be eliminated immediately. There are necessary to run the current process. Technology,
environment, culture require these activities. You would look at minimizing this category of
work
Non-Value Adding (NVA)
Non Value-Added Work can usually be eliminated quickly and is not dependent on
improvement of other areas. This is the work nobody needs and it is pure waste. You would
look at eliminating this category of work.
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Value Added
(VA)
Non-Value
Added
(NVA)
Any Activity the
Customer Values &
is Willing to Pay
Who are your
Customers?
What do they Really
Want?
Activities that the
Customer would not pay
for
Any Activity that
Consumes Time and or
Resources and Doesn’t
Add Value to the Products
or Services for the
Customer
Un-Necessary
Waste
These Activities
should be
Eliminated /
Simplified /
Reduced or
Integrated
Necessary
Support
Processes; Legal
/ Regulatory or
Compliance
Requirements
Whether Customer
Considers Worth
Paying?
Does it Change Form
/ Function
Does it Done First
Time Right?
SN Panigrahi

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Value
Added
Work
Change /
Transformation
First Right
Time
Customer is
Willing to Pay
These Activities Change or Transform an Item
from one Condition to another, or from one
State to another which the Customer needs
These Activities are which the Customer Wants
Done, as he Perceives them to be Necessary
Steps to Create the Product or Service he
Expects, and hence is willing to Pay for
These Activities are done in a Right Way, or
Correctly the Very First Time, that is Without
Need for Correction or Rework
SN Panigrahi

51. Customer Value
Perceived
Benefits
Perceived
Sacrifices
Product Value
Service Value
Functional Value
Personal Value
Emotional Value
Image Value
Monitory Price
Time Cost
Energy Cost
Cost of Risks
Regulatory Cost
Psychological Cost
Customer
Value
Value for Money (VFM)
A measure of quality that assesses
the monetary cost of the product or
service against the quality and/or
benefits of that product or service,
taking into account subjective factors
such as fitness for purpose, along
with whole-of-life costs such as
installation, training,
maintenance and disposal, and
wastage.
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5W
2H
What?
What will be done?
Goals & Objectives
Action Steps,
Description.
Why?
Why will it be
done? Justification,
Reason, Benefits.
Where?
Where will it be
done? Location,
Area, Department
When?
When will it be
done? Time, Dates,
Deadlines,
Schedules.
Who?
Who will do it?
Who’s Responsible
for it?
How?
How will it be
done? Method,
process
How much?
How much Cost &
Quantity? Costs or
expenses involved.
SN Panigrahi

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Mura
Muri
Muda
“Unevenness” or Failure
Due to Inconsistent or
Unpredictable Outputs.
Irregularity, Variability.
Unevenness or Fluctuations in a
Production Plan, Operation or an
uneven work pace in an
Operation causing Operators to
Hurry and then Wait
“Overburden” or Failures of
Standardization to Create
Efficient Process.
Strain, Difficulty, Hard to Do.
Overburdening Equipment or
Operators – Longer Periods
of Time beyond Standards
“Waste” or Failure of People
or Processes to Effectively
Deliver Product.
Manufacturing Waste Events;
Non-Value Added Activity;
Incurs Cost – Customer will
not Pay for
There are two types of Muda
Type 1 Muda
Non-Value-Added activities in
the processes that are
necessary. For example,
inspection and safety testing do
not directly add value to the final
product; however, they are
necessary activities to ensure a
safe product for customers.
Type 2 Muda
Non-Value Added activities in the
processes, but these activities are
unnecessary for the customer. As
a result, Muda Type 2 should be
Eliminated. NTI – SN Panigrahi

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• Efforts Caused by Rework, Repair, Scrap and Incorrect InformationDefects
• Producing More than is Needed or Before it is Needed
Over-
Production
• Wasted Time Waiting for the Next Step in the ProcessWaiting
• Under-Utilizing People’s Talents, Skills and Knowledge
Non-Utilization of
Talent
• Unnecessary Movements of Products or ServicesTransportation
• Excess Products and Materials being Produced or ProcuredInventory
• Unnecessary Movement by PeopleMotion
• More Work or Higher Quality than is Required by the Customer
Extra
Processing
D
O
W
N
T
I
M
E

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Process
Define, Identify,
Prevent, Reduce,
Eliminate and
Continuously
Improve, the 8
wastes of Lean
from impacting
the productivity
of the
organization.
Benefits
 Increased
Productivity
 Improved Quality
 Right Delivery of
Deliverables at Right
Time with in Budget
 Smoother Operation-
Improved Continuous
Flow of Value
 Reduced Operating
Costs

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Defects Over
production
Waiting Non-Utilized
Talent
Transportation Excess
Processing
Inventory Motion
Down Time
D Defects
O Overproduction
W Waiting
N Non-Utiulized
Talent
T Transportation
I Inventory
M Motion
E Extra Processing
Taiichi Ohno’s
7 Wastes
+ 8th Waste
Non-Utiulized Talent
SN Panigrahi

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Kaizen is method and a word that was created in Japan after World War II.
The word Kaizen means “continuous improvement.” It comes from the Japanese
words 改 (“kai”) which means “change” or “to correct” and 善 (“zen”) which means
“good.” It is pronounced “k-eye-zen.”
Masaaki Imai (born, 1930) is a Japanese organizational theorist and
management consultant, known for his work on quality management, specifically
on Kaizen. In 1985 he founded the Kaizen Institute Consulting Group (KICG) to
help western companies introduce the concepts, systems and tools of Kaizen. At
present time, the Kaizen Institute team has applied the lean methodology and
kaizen training courses across virtually all business sectors throughout the globe.

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Kaizen Event
In modern usage, kaizen is designed to address a particular issue
over the course of a week, which is referred to as a “kaizen blitz”
or “kaizen event”. A kaizen event is a focused development project
that can accomplish breakthrough improvements in a short amount
of time, about 2-10 days in scope. Kaizen events must have a
clear, concise objective along with immediately available resources
and rapid results. This ensures the results are significant, clear
and quick to promote the generation of continued enthusiasm and
satisfaction.

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Eliminate waste (non value added activities)
Increase productivity / output
Reduce inventory (less material and labor)
Reduce cycle time (less time to produce specific part)
Reduce space (work cell, office area)
Improve On-Time Delivery (OTD)
Improve quality of product and process
Improve housekeeping, 5S and visual management
Reduce downtime (setup time, maintenance)
Reduce transport time and distance
Standardize the process (less variation)
Reduce operating costs
Kaizen Targets

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1. Never Stop
2. Be Proactive
3. Eliminate Old
Practices
4. Don’t Stop
5. Make Corrections
6. Empower All
Employees to Speak
Up
7. Don’t Assume New
Methods Will Work
8. Practice the “Five
Why” Method
9. Be Economical
10. Crowdsource
10 Basic
Principles Of
KAIZEN

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https://www.youtube.com/channel/UCVZ
ScNa_leR8XbYINEwTFwQ/videos
SN Panigrahi

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67. Contact Details:
SN Panigrahi
9652571117
snpanigrahi1963@gmail.com 67