VOLKSWAGEN

TQM CASE STUDY

Project Members:
1. James Alwyn Durai.X(20073720).
2. Karthikeyan.M.P(20063723).
CONTENTS:
1. INTRODUCTION.

2. COMPANY OVERVIEW.

3. QUALITY STATEMENTS.

i)MISSION STATEMENT.

ii)VISION STATEMENT.

4. STATEGIC PLAN.

5. RISK MANAGEMENT SYSTEM.

i) SAFETY IN THE WORK PLACE.

ii) eBUSINESS ACTIVITIES.

6. CUSTOMER SATISFACTION.

7. CONTINUOUS PROCESS IMPROVEMENT.

8. FMEA.

9. QUALITY MANAGEMENT SYSTEM.

INTRODUCTION:
Volkswagen is setting benchmarks in quality throughout the world with its
responsible technology, and exceptional German engineering. The power of
innovation drives Volkswagen to create cars that are at the cutting edge of
technology.

COMPANY OVERVIEW:
When in 1937 the company known as "Gesellschaft zur Vorbereitung des
Deutschen Volkswagens mbH" was founded, no one could have guessed that it
would one day be Europe's largest carmaker. The history of the company - with all
its trials and tribulations - is first and foremost a story of impressive success.

1937-1945

On May 28th, 1937 the "Gesellschaft zur Vorbereitung des Deutschen

Volkswagens mbH" company is founded, and on September 16th, 1938 it is
renamed "Volkswagenwerk GmbH". In early 1938, in what is today Wolfsburg,
work begins on construction of the Volkswagenwerk plant which is to house
production of the new vehicle designed by Ferdinand Porsche.

1945-1949

After the end of the Second World War, in mid June 1945, responsibility for
Volkswagenwerk is placed in the hands of the British Military Government. Under
the management of Major Ivan Hirst, mass production of the Volkswagen Beetle is
started.

1949-1980

On March 8th, 1950 the Type 2 goes into production, expanding the company's
product range. The Volkswagen Bus, still today known to many as the "VW
Bully", soon creates rising demand thanks to its multifunctional capabilities. In
1956 a separate manufacturing base for the Transporter is established in Hanover,

at the same time setting down the roots of today's Volkswagen Commercial
Vehicles brand.
1980-1990

In June 1983 production of the second-generation Golf begins. The car is designed
for a largely automated assembly process, and in the specially erected final
assembly hall, designated Hall 54, robots are deployed for the first time in vehicle
manufacture.

1990-2003

With the production launch of the Lupo 3L TDI, the first production car to offer
fuel consumption of just three litres per 100 kilometres, in July 1999, Volkswagen
once again makes automotive history.

After 2003

In 2003 production of the fifth-generation Golf is started, embodying a new

dynamism in its design and engineering. The Volkswagen Group with its
headquarters in Wolfsburg is one of the world’s leading automobile manufacturers
and the largest car producer in Europe. In Western Europe, the largest car market
in the world, nearly every fifth new car came from the Volkswagen Group. The
company attained a Global market share of 12.1 percent.

The Group operates 44 production plants in eleven European countries and seven
countries in the Americas, Asia and Africa. Around the world more than 320,000
employees produce over 21,500 vehicles or are involved in vehicle-related services
on every working day. The Volkswagen Group sells its vehicles in more than 150
countries. It is the goal of the Group to offer attractive, safe and environmentally
friendly vehicles which are competitive on an increasingly tough market and which
set world standards in their respective classes.

The Group's passenger car business is divided into two Brand Groups. Under the
leadership of the Group, the Audi and Volkswagen brands are responsible for the
results of their respective Brand Group worldwide.

Audi's Brand Group is made up of the Audi, Seat and Lamborghini brands and
places an emphasis on sporty values. The Volkswagen Brand Group is made up of
the Volkswagen, Škoda Auto, Bentley and Bugatti brands and stands for more
classic values. Each brand retains its differentiated brand-image and operates as an
independent entity on the market. Together, the product ranges extend from the
low-consumption 3 litre vehicle to luxury class vehicles. The Group’s commercial
vehicle products are the responsibility of the Volkswagen Commercial Vehicles
brand. Across all its brands, the brand group responded to declining markets with
flexible adjustments of production.

QUALITY STATEMENTS:
MISSION STATEMENT:

We are a team of highly qualified professionals, dedicated to providing services of

unparalleled quality to our customers. To that end and through our services, we
will create a collaborative environment that:

 PROVIDEs a quality product,

 CREATEs a safe environment,
 ENHANCEs productivity, and
 ENABLEs our customers to be more SUCCESSful.

VISION STATEMENT:
In just 20 years, drivers will be able to make their vehicle "smile" by reconfiguring
light panels made from nano LEDs in place of headlights. Driving will be accident-
free, and emissions will have gone the way of the rumble seat. This vision of the
automotive future is the premise of Volkswagen's new interactive microsite, which
examines what driving might be like in 2028.
STATEGIC PLAN:
RISK MANAGEMENT SYSTEM.
The aim of all business activity is to identify and exploit opportunities to enhance
the value of the business. In this, Volkswagen – as a Group of companies operating
on a worldwide scale – is also exposed to risk. The responsible handling of global
uncertainty forms part of the risk management system operated by Volkswagen.
The object of this system is to identify business risk in a timely manner and to limit
it to such an extent that the economic benefit of the relevant business activities
outweighs the risk.

Alongside the existing reporting and early warning system, the risk situation is
routinely assessed on the basis of written and verbal surveys. The risk management
system is an integral part of Group management practice, and has been assessed by
the Company’s external auditors. Accordingly, it conforms to the requirements of
the German Law governing controls and transparency in business (KonTraG).

SAFETY IN THE WORK PLACE:

Hazardous substances at the workplace can mean serious health risks for the
employees concerned. To protect them, the employer is required to find out all of
the properties of the materials used relevant for the safety of employees and the
associated risks at work in order to be able to take appropriate protective action.

To determine the risk situation for employees, investigations of the concentrations

of hazardous substances in the air at workplaces are necessary. The main areas of
application for measurements of hazardous substances include measurements of
welding smoke in bodywork manufacture, coolant lubricants in metal processing,
solvent measurements in the paint shop as well as diesel engine emissions in halls
where vehicles are driven. The results of measurements of hazardous substances
are the basis for the specification of threshold values as well as the cause of the
supervisory authorities to order safety technical measures. In view of the range of
decisions of this kind, we make high demands of the reliability of the results of
these investigations.
The Safety Chemistry Measuring Centre of Volkswagen AG has been accredited
according to ISO 17025 since 1999 and thus bears the quality seal to assess the
workplace-related situation of hazardous substances in the air. The expertise and
many years of experience of biologists, chemists, engineers and technicians at the
Measuring Centre in the field of measuring hazardous substance as well as a
comprehensive quality management system guarantee the accommodation of the
most stringent quality assurance criteria, from acceptance of the order and taking
samples, analyses and measurements as well as drawing up a comprehensive,
detailed documentation right up to advice in matters of dealing with hazardous
substances and portraying practicable solutions to problems. The regular
reaccreditation guarantees that the processes and sequences meet international
standards and that the results of internal and external measurements are recognised
by the authorities. Several requirements must be met:

 mastering the regulations on hazardous substances and the necessary

expertise by sample-taking and testing personnel,
 the availability of the necessary sampling and analysis facilities and
 conducting quality assurance measures according to the Quality
Management Manual

A dynamic process ensures that the quality of the Measuring Centre continuously
adapts to the current technical requirements and opportunities and the statutory
requirements. Only by means of constant further training of employees and further
development of the state of the art is sustainable species protection in the company
possible.

eBUSINESS ACTIVITIES:

In close collaboration with its suppliers, Volkswagen has progressed its e-Business
activities begun in 2001 from a B2B marketplace to a B2B supplier platform. The
portal at www.vwgroupsupply.com optimizes the information flow between the
Volkswagen Group and its partners while at the same time creating a stronger link
between supplier and Group processes.
The core of the system is the new "VWGroupSupply" supplier database, which in
future – containing, as it does, all the suppliers to the Volkswagen Group – will
represent one of the largest component supplier listings in the automotive industry.
In it, all suppliers will be able to record their individual calling cards – that is, the
range of products and services they offer to the Volkswagen Group.

The virtual applications, including the "Electronic Supplier Link (ESL)" online
inquiry facility online negotiating online catalogue purchasing "eCAP" capacity
management online standard texts will save time, cut costs and so boost the
competitiveness of the Volkswagen Group. This communications platform now
also integrates other processes, such as technical modifications and invoice
processing, online.

The Volkswagen Group already manages nearly its complete procurement volume
of more than € 50 billion via the Internet.

The internet platform started in early summer of 2000 is up and running. Under the
domain "VW Group Supply.com" the most important components Online
Catalogs, Online Inquiries, Online Negotiations and Capacity Management have
already been introduced to all brands and regions of the Volkswagen Group.
CUSTOMER SATISFACTION:
The satisfaction of our customers with the Group brands is regularly measured in a
number of countries with the help of special questionnaires, though when
conducting these studies we concentrate primarily on product and service quality.
The results are analyzed and assessed in terms of their contribution to target
achievement, and appropriate measures for improvement are then developed. In
terms of satisfaction with product and service quality, the Audi and Škoda brands
occupy a leading position in the core European markets when ranked against
competitors. The scores of the other Group brands for overall satisfaction are also
on a par with or higher than competitors’ results.

Customer satisfaction provides the basis for customer loyalty. Loyal customers
demonstrate their confidence in our brands, and this confidence is clearly reflected
in the loyalty figures. Volkswagen was able to maintain brand loyalty in its core
European markets at a high level in 2008. Škoda also ranks among the leaders for
brand loyalty – as it has done for many years.

CONTINUOUS PROCESS IMPROVEMENT:

A continuous improvement process (CIP or CI) is an ongoing effort to improve
products, services, or processes. These efforts can seek "incremental" improvement
over time or "breakthrough" improvement all at once. Delivery (customer valued)
processes are constantly evaluated and improved in the light of their efficiency,
effectiveness and flexibility.

Some see it as a meta-process for most management systems (Business Process

Management, Quality Management, Project Management). Deming saw it as part
of the 'system' whereby feedback from the process and customer were evaluated
against organisational goals. The fact that it can be called a management process
does not mean that it needs to be executed by 'management' merely that it makes
decisions about the implementation of the delivery process and the design of the
delivery process itself.
Some successful implementations use the approach known as Kaizen (the
translation of kai (“change”) zen (“good”) is “improvement”). This method became
famous by the book of Masaaki Imai “Kaizen: The Key to Japan's Competitive
Success.”

* The core principle of CIP is the (self) reflection of processes. (Feedback)

* The purpose of CIP is the identification, reduction, and elimination of

suboptimal processes. (Efficiency)

* The emphasis of CIP is on incremental, continuous steps rather than giant

leaps. (Evolution)

Key features of Kaizen:

* Improvements are based on many, small changes rather than the radical
changes that might arise from Research and Development

* As the ideas come from the workers themselves, they are less likely to be
radically different, and therefore easier to implement

* Small improvements are less likely to require major capital investment than
major process changes

* The ideas come from the talents of the existing workforce, as opposed to using
R&D, consultants or equipment – any of which could be very expensive

* All employees should continually be seeking ways to improve their own

performance

* It helps encourage workers to take ownership for their work, and can help
reinforce team working, thereby improving worker motivation

The elements above are the more tactical elements of CIP. The more strategic
elements include deciding how to increase the value of the delivery process output
to the customer (Effectiveness) and how much flexibility is valuable in the process
to meet changing needs
FMEA:
A failure modes and effects analysis (FMEA), is a procedure in product
development and operations management for analysis of potential failure modes
within a system for classification by the severity and likelihood of the failures. A
successful FMEA activity helps a team to identify potential failure modes based on
past experience with similar products or processes, enabling the team to design
those failures out of the system with the minimum of effort and resource
expenditure, thereby reducing development time and costs. It is widely used in
manufacturing industries in various phases of the product life cycle and is now
increasingly finding use in the service industry. Failure modes are any errors or
defects in a process, design, or item, especially those that affect the customer, and
can be potential or actual. Effects analysis refers to studying the consequences of
those failures.

QUALITY MANAGEMENT SYSTEM:

Audi Volkswagen Middle East FZE is a Regional Sales Company with the task to
organize and govern the wholesale and related services for the brands Audi and
Volkswagen Passenger Cars for the following countries in the region:

* United Arab Emirates

* Kingdom of Saudi Arabia
* Kuwait
* Bahrain
* Oman
* Qatar
* Lebanon
* Jordan
* Syria
* Iraq
* Iran
At Audi Volkswagen Middle East FZE we are committed to service excellence in
all areas of our business.

Our policy covers the distribution of the Audi & Volkswagen range of vehicles to
the regional Audi & Volkswagen network for onward sale to our customers.

We aim to supply high quality products and services and to stimulate demand
through intelligent and engaging marketing activities, supported by efficient after-
sales service and parts supply.

We provide & coordinate expert training to our network in all areas of the sales
and service business with a focus on customer-orientation, supported by an
effective customer relationship management for our partners.

To ensure that our customer’s needs and expectations are satisfied, we have
established a process-oriented quality management system which complies with
ISO 9001:2008.

An ongoing training system will ensure all staff are trained to support and
implement our quality policy through the quality management system and
procedures. It will also assist our efforts to strive for continual improvements in
every facet of our business.

This “Total Quality” environment aims to build customer confidence and assists us
to develop and maintain customer, partner and supplier relationships that meet and
even exceed expectations.
CONCLUSION:
Thus the Volkswagens overview, its quality council, its quality
statements, its strategic plans, its quality management system,
continuous process improvement, and the customer satisfaction is dealt
in detail.