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MGT 494 – PROJECT REPORT MEMBERS
 SALMA KALSOOM USMAN - 036
 ABU BAKAR BUTT – 047
 MUHAMMAD IQBAL – 053 (GROUP LEADER)
 SHAFAQ UROOJ – 167
Total Quality Management Practices
&
Their Effects on Organizational Performance
ABSTRACT
Total quality management (TQM) is considered a very important factor for the long-term success of an
organization. TQM implementation has been an important aspect for improving organizational efficiency.
The links between TQM and performance have been investigated by numerous scholars. While
examining the relationship between TQM and performance scholars have used different performance
types such as financial, innovative, operational and quality performance. Recent research on total quality
management has examined the relationships between the Total quality management and organizational
performance. TQM focuses on continuous process improvement within organizations to provide superior
customer value and meet customer needs. TQM a popular guideline for organizational management is
adopted for developing strategic info, maps and info charts for an information organization.Total Quality
Management is defined as an integrative management philosophy and a set of guiding principles,
representing the foundation of a continuously improving organization.
Group No: 03
TOTAL QUALITY MANAGEMENT
1
Table of Contents
INTRODUCTION 3
EVOLUTION OF TOTAL QUALITY MANAGEMENT: 3
HISTORICAL BACKGROUND OF TOTAL QUALITY MANAGEMENT: 3
WHAT IS “QUALITY”? 4
WHAT IS TOTAL QUALITYMANAGEMENT? 4
THE DEFINITION: 5
NEED FOR TOTAL QUALITYMANAGEMENT: 5
SIGNIFICANCE OF TERM TQM 6
TOTAL: 6
QUALITY: 6
MANAGEMENT: 6
TOTAL QUALITYMANAGEMENT TQM CYCLE OR PROCESS: 6
TQM& ORGANIZATIONAL DEVELOPMENT 7
ANALYSIS/ DISCUSSION 8
PRINCIPLES OF TQM 10
MANAGEMENT COMMITMENT 10
EMPLOYEE EMPOWERMENT 10
FACT BASED DECISION MAKING 10
CONTINUOUS IMPROVEMENT 10
CUSTOMER FOCUS 10
IMPLEMENTATION OF TQM IN ORGANIZATIONS 11
STEPS IN MANAGING THE TRANSITION 12
TOTAL QUALITY MANAGEMENT
2
LEVELS OF TOTAL QUALITYMANAGEMENT ADOPTION BY ORGANIZATIONS 14
 UNCOMMITTED 15
 DRIFTERS 16
 TOOL PUSHERS 17
 IMPROVERS 18
 AWARD WINNERS 19
 WORLD CLASS 19
EFFECTS OF TQM PRACTICES ON ORGANIZATIONAL PERFORMANCE 20
CONCLUSION 24
REFERENCES 25
TOTAL QUALITY MANAGEMENT
3
INTRODUCTION
Evolution of Total Quality Management:
Quality management philosophy was evolved in Japan after the Second World War. An
American expert Edwards Deming helped the Japanese to apply concepts of TQM. In 1968 the
Japanese shaped the phrase Total Quality Control and became the world quality leader. In the
1980 the U.S. Navel Air Systems coined the TQM phrase. In 80’s most companies in the world
started applying this concept and enhanced their productivity and profitability remarkably.
Historical Backgroundof Total Quality Management:
Although the concept of “Quality” is very old, today it’s perhaps the major preoccupation or
organization worldwide. However, in the recent years, Total Quality Management (TQM) has
captured the worldwide attention and is being adopted in many organizations, both profit & non
profit. TQM is being accepted as a management philosophy.
Quality in articles and artifacts produced by skilled craftsmen and artisans from the B.C. era, e.g.
Goldsmiths, Silversmiths, Blacksmiths, potters, etc.
Artists & Artisans Guilds in the Middle Ages spent years imparting quality skills and the works
men had pride in making quality products. In 1946, the American Society for Quality Control
was formed. In 1950, W. Edwards Deming, who learnt SQC from Shewhart, taught SPC & SQC
to Japanese engineers and CEO’s.
In 1960, the first Quality Control circles were formed. In 1970’s US managers were learning
from Japan Quality Implementation miracles. In 1980’s Total Quality Management principles
and methods became popular. In 1990’s the ISO 9000 model became the worldwide standard for
QMS.
TOTAL QUALITY MANAGEMENT
4
What is “Quality”?
The word “Quality” stands for:
 Q= Stands for quest/search for excellence.
 U= Stands for understanding customers needs, i.e. to understand what makes a customer
actually wants.
 A= Stands for the action of a business to achieve customers appreciation.
 L= Stands for leadership i.e. a firm should be determined to be a leader in terms of
quality product.
 I= Stands for involving all people
 T= Stands for team spirit to work for a common goal
 Y= Stands for yardstick (measuring rod) to measure progress.
What is Total Quality Management?
Total: Made up of whole
Quality: Degree of excellence a product or service provides
Management: Act, Art or Manager of handling, controlling, directing etc.
“Total” it is the integration of the staff, suppliers, customers and other stakeholders. Away from
party specific thinking to a more holistic approach. Q stands for “Quality” it’s the quality of the
work and the process of the enterprise leading to Quality of products. M for management it
stresses the leadership task and the quality of leadership.
TOTAL QUALITY MANAGEMENT
5
The Definition:
Total Quality Management is a system of management based on the principle that every member
of staff must be committed to maintaining high standards of work in every aspect of a company’s
operation.”
“Quality” is “a degree of excellence; a distinguishing attribute.” That is, Quality” is the degree to
which a product lives up to its performance, endurance, maintainability, and other attributes that
a customer expects to receive from purchasing this product. In order to produce a quality
product, one must instill the TQM concept into one’s product development process. The word
“Total” mean the total of everything in an organization. That is, it covers every process, every
job, every resource, every output, every person, every time and every place.
According to the American Society for Quality Control (ASQC), Total Quality Management
(TQM) “is a management approach to long term success through customer satisfaction. TQM is
based on the participation of all members of an organization to improve processes, products,
services, and the culture they work in. TQM benefits all organization members and society. The
method for implementing this approach is found in the teachings of such quality leaders as Philip
B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Karou Ishikawa, and J.M. Juran”.
Need for Total Quality Management:
TQM is needed for development of the best world class organization. Reduce cost and improve
quality continuously. It also need for the development of problem solving skills and to build a
happy bright place.
TOTAL QUALITY MANAGEMENT
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Significance of Term TQM
Total:
The responsibility for achieving Quality rests with everyone a business, no matter what their
function. It recognizes the necessity to develop processes across the business, that together lead
to the reliable degree of exact, agreed customer requirements. This will achieve the most
competitive cost position and a higher return on investment.
Quality:
The prime task of any business is to understand the needs of the customer, then deliver the
product or service at the agreed time, place and price, on every occasion. This will retain current
customers, assist in acquiring new ones and lead to a subsequent increase in market share.
Management:
Top management leads the drive to achieve quality for customers, by communicating the
business vision and values to all employees; ensuring the right business processes are in place;
introducing and maintaining a continuous improvement culture.
Total Quality Management TQM Cycle or Process:
TQM processes are divided into four sequential categories: Plan, Do, Check, and Act. In
planning phase, people define the problem to be addressed, collect relevant data, and ascertain
the problem root cause; in the doing phase, people develop and implement a solution, and decide
upon a measurement to gauge its effectiveness; in the checking phase people confirm the results
through before and after data comparison; in the acting phase, people document their results,
inform others about process changes, and make recommendations for the problem to be
addressed in the next PDCA cycle.
TOTAL QUALITY MANAGEMENT
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TQM& Organizational Development
TQM is considered to be an important factor in the organizational development. Prior
studies suggest that the TQM strategy that focuses on increasing customer levels of satisfaction
does have a significant and positive impact on performance. Ittner and Larcker, for example,
suggest that attaining customer satisfaction is thought to increase the profits of the organization
by decreasing costs through fewer returns and increasing revenues through customer loyalty. The
links between TQM and performance have been investigated by numerous scholars. While
examining the relationship between TQM and performance scholars have used different
performance types such as financial, innovative, operational and quality performance. Although
the effects of TQM on various performance types are inconsistent, quality performance generally
indicated strong and positive relations. Studies have claimed that marketing and TQM are
complement- tarry business philosophies. From Seraph et al., many studies have attempted to
develop an appropriate set of critical quality management constructs to represent an integrated
approach to TQM implement- titian in a business unit. Some scholars have claimed that the
effects of TQM practices on various types of performance measures differ. In addition, few
empirical studies have investigated the mediating effect (indirect relationship) of one type of
TOTAL QUALITY MANAGEMENT
8
performance measure on the relationship between TQM practices and another type of
performance measure.
Therefore, the TQM concept caught the attention of all aspects of the business and academics. A
large number of articles published in this respect are very concerned about the quality of
evidence. In the last decade, to improve the quality became one of the most important
organizational strategies for achieving competitive advantage. Improving the quality and
organization can offer their products and services are crucial for the expansion of global market
competition. TQM started with the main needs of the organization assumed the cooperation of
staff with one another to achieve the quality of service for customers. People can control the
processes of production / services, in order to avoid mistakes thus achieving quality.
TQM process also depends on the set point and all members of the organization share the same
faith. The concept of quality has been regarded as the market is not fully competitive basis, to be
considered a strategic enterprise resource migrate non-price factors. In other words, the quality
of the product treated as a multidimensional construct that needs to be managed rather than one-
dimensional property, which leads to the ability to perform dynamic business
ANALYSIS/ DISCUSSION
TQM is a management philosophy that seeks to integrate all organizational functions (marketing,
finance, design, engineering, and production, customer service, etc.) to focus on meeting
customer needs and organizational objectives.
TQM views an organization as a collection of processes. It maintains that organizations must
strive to continuously improve these processes by incorporating the knowledge and experiences
of workers. The simple objective of TQM is “Do the right things, right the first time, every
TOTAL QUALITY MANAGEMENT
9
time.” TQM is infinitely variable and adaptable. Although originally applied to manufacturing
operations, and for a number of years only used in that area, TQM is now becoming recognized
as a generic management tool, just as applicable in service and public sector organizations. There
are a number of evolutionary strands, with different sectors, creating their own versions from the
common ancestor. TQM is the foundation for activities, which include:
 Commitment by senior management and all employees
 Meeting customer requirements
 Reducing development cycle times
 Just in time/demand flow manufacturing
 Improvement teams
 Reducing product and service costs
 Systems to facilitate improvement
 Line management ownership
 Employee involvement and empowerment
 Recognition and celebration
 Challenging quantified goals and benchmarking
 Focus on processes / improvement plans
 Specific incorporation in strategic planning
This shows that TQM must be practiced in all activities, by all personnel, in manufacturing,
marketing, engineering, R&D, sales, purchasing, HR, etc.
TOTAL QUALITY MANAGEMENT
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Principles of TQM
The key principles of TQM are as following:
Management Commitment
 Plan (drive, direct)
 Do (deploy, support, participate)
 Check (review)
 Act (recognize, communicate, revise)
Employee Empowerment
 Training
 Suggestion scheme
 Measurement and recognition
 Excellence teams
Fact Based Decision Making
 SPC (statistical process control)
 DOE, FMEA
 The 7 statistical tools
 TOPS (Ford 8D – team-oriented problem solving)
Continuous Improvement
 Systematic measurement and focus on CONQ
 Excellence teams
 Cross-functional process management
 Attain, maintain, improve standards
Customer Focus
 Supplier partnership
 Service relationship with internal customers
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 Never compromise quality
 Customer driven standards
Implementation of TQM in Organizations
A preliminary step in TQM implementation is to assess the organization’s current reality.
Relevant preconditions have to do with the organization’s history, its current needs, precipitating
events leading to TQM, and the existing employee quality of working life. If the current reality
does not include important preconditions, TQM implementation should be delayed until the
organization is in a state in which TQM is likely to succeed.
If an organization has a track record of effective responsiveness to the environment, and if it has
been able to successfully change the way it operates when needed, TQM will be easier to
implement. If an organization has been historically reactive and has no skill at improving its
operating systems, there will be both employee skepticism and a lack of skilled change agents. If
this condition prevails, a comprehensive program of management and leadership development
may be instituted. A management audit is a good assessment tool to identify current levels of
organizational functioning and areas in need of change. An organization should be basically
healthy before beginning TQM. If it has significant problems such as a very unstable funding
base, weak administrative systems, lack of managerial skill, or poor employee morale, TQM
would not be appropriate.
However, a certain level of stress is probably desirable to initiate TQM. People need to feel a
need for a change. Tichey, N. (1983) addresses this phenomenon be describing building blocks
which are present in effective organizational change. These forces include departures from
tradition, a crisis or galvanizing event, strategic decisions, individual “prime movers,” and action
vehicles. Departures from tradition are activities, usually at lower levels of the organization,
TOTAL QUALITY MANAGEMENT
12
which occur when entrepreneurs move outside the normal ways of operating to solve a problem.
A crisis, if it is not too disabling, can also help create a sense of urgency which can mobilize
people to act. In the case of TQM, this may be a funding cut or threat, or demands from
consumers or other stakeholders for improved quality of service. After a crisis, a leader may
intervene strategically by articulating a new vision of the future to help the organization deal
with it. A plan to implement TQM may be such a strategic decision. Such a leader may then
become a prime mover, who takes charge in championing the new idea and showing others how
it will help them get where they want to go. Finally, action vehicles are needed and mechanisms
or structures to enable the change to occur and become institutionalized.
Steps in Managing the Transition
Hill Stephen(1991) have outlined the basic steps in managing a transition to a new system such
as TQM: identifying tasks to be done, creating necessary management structures, developing
strategies for building commitment, designing mechanisms to communicate the change, and
assigning resources.
Task identification would include a study of present conditions (assessing current reality, as
described above); assessing readiness, such as through a force field analysis; creating a model of
the desired state, in this case, implementation of TQM; announcing the change goals to the
organization; and assigning responsibilities and resources. This final step would include securing
outside consultation and training and assigning someone within the organization to oversee the
effort. This should be a responsibility of top management. In fact, the next step, designing
transition management structures, is also a responsibility of top management. In fact, Hyde
(1992) assert that management must be heavily involved as leaders rather than relying on a
separate staff person or function to shepherd the effort. An organization wide steering committee
TOTAL QUALITY MANAGEMENT
13
to oversee the effort may be appropriate. Developing commitment strategies was discussed
above in the sections on resistance and on visionary leadership.
To communicate the change, mechanisms beyond existing processes will need to be developed.
Special all-staff meetings attended by executives, sometimes designed as input or dialog
sessions, may be used to kick off the process, and TQM newsletters may be an effective ongoing
communication tool to keep employees aware of activities and accomplishments.
Management of resources for the change effort is important with TQM because outside
consultants will almost always be required. Choose consultants based on their prior relevant
experience and their commitment to adapting the process to fit unique organizational needs.
While consultants will be invaluable with the initial training of staff and TQM system design,
employees (management and others) should be actively involved in TQM implementation,
perhaps after receiving training in change management which they can then pass on to other
employees. A collaborative relationship with consultants and clear role definitions and
specification of activities must be established.
In summary, first assess preconditions and the current state of the organization to make sure the
need for change is clear and that TQM is an appropriate strategy. Leadership styles and
organizational culture must be congruent with TQM. If they are not, this should be worked on or
TQM implementation should be avoided or delayed until favorable conditions exist.
Though it would be a difficult, comprehensive, and long-term process, leaders will need to
maintain their commitment, keep the process visible, provide necessary support, and hold people
accountable for results. Use input from stakeholder (clients, referring agencies, funding sources,
etc.) as possible; and, of course, maximize employee involvement in design of the system.
TOTAL QUALITY MANAGEMENT
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Levels of Total Quality Management Adoption by Organizations
An illustration of TQM in Organizations is
Total
Quality Management is a management approach that originated in the 1950s and has steadily
become more popular since the early 1980s. Total Quality is a description of the culture, attitude
and the organization of a company that strives to provide customers with products and services
that satisfy their needs. The culture requires quality in all aspects of the company’s operations,
with processes being done right the first time and defects and waste eradicated from operations.
Total Quality Management, TQM, is a method by which management and employees can
become involved in the continuous improvement of the production of goods and services. It is a
combination of quality and management tools aimed at increasing business and reducing losses
due to wasteful practices.
The Six different levels of TQM implementation, this includes uncommitted, drifters, tool
pushers’ improvers’ award winners and world class. According to them, these stages do not
TQM
Continous
Improvement
Control
Culture
Commitment
Cooperation
Customer
Focus
TOTAL QUALITY MANAGEMENT
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necessarily represent the stages through which organizations pass on their TQM journey. These
levels are to help organization in identifying their weaknesses and proffering solutions to them
through the use of continuous improvement. (Dale and Light burn 1992)
 Uncommitted
This stage represents organizations that have not started a formal procedure of quality
improvement. Organizations at this stage view quality improvement as an added cost and thus
have no investment in quality improvement program such as training of employees.
Organizations in this stage are termed uncommitted because they are not aware of the benefit of
quality improvement and lack an appropriate quality improvement plan. The management of
these organizations is characterized by an emphasis on return of sales and net asset employed.
For example: non-attendance the meeting, failure to respond to requests the data, and not doing
what they had agreed to do.
Other common features of this level include:
• A major concern for meeting sales target.
• Employees show little or no concern for quality.
• Full inspection of materials is carried on incoming material and at strategic points during the
process of production.
• Lack of communication among the various units of production even between the top
management and front line employees.
• Minimal contact with customers.
TOTAL QUALITY MANAGEMENT
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 Drifters
These are organizations that have engaged in a process of quality improvement for up to three
years and have followed the available advice and wisdom of TQM. The management of the
organizations at this stage tends to review the performance of the firm based on the
implementation of TQM and expect immediate gains from it. These organizations view TQM as
a program rather than a process, thus making the policy have a low profile among employees.
Organizations with such an approach to management are termed drifter because they drift from
one program to the other in a start stop fashion with concepts, ideas and initiative being reborn
and re-launched under different guises. Organizations which fall within this stage usually have
no plan for the deployment of TQM philosophy throughout the organization thus limiting the
implementation of TQM to the managers while leaving the shop floor out of the implementation
process.
Other common features of this level include:
• Managements are overly susceptible to outside interventions and easily get distracted by the
latest “fads” which are put to them under various guises (i.e. they are quality fashion victims).
• The quality department has low status within the organization.
• Continuous improvement activities are little more than cosmetic ‘off-line’ motivation
programs, with little impression on the company’s organizational structure, internal
relationships, and overall business direction.
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• Any team working is superficial and departments only tend to co-operate in order to lay the
blame on another department. Considerable in-fighting, rivalry and ‘politics’ exist between
departments
• No real changes in corporate culture have been made since the start of the TQM initiative. The
activities associated with TQM are not given time to come to fruition before they are discarded
and replaced by others.
• A fear of failure and uncertainty pervades the organization and there is the view that TQM will
be sidelined in the medium term.
 Tool pushers
Organizations in this category look at quality improvement programs, but in most cases fail to
use such tools appropriately. They adopt quality management tools such as quality cycles,
quality improvement groups. These organizations often blame the failure of TQM on the tools
adopted. It explained that organizations in this stage find it difficult to sustain the momentum of
its improvement initiatives and it is continually on the lookout for new ideas. (Anders
Hederstierna)
Some characteristics of the drifters include:
• A major concern for meeting sales target.
• Solving current problems rather than future problems
• Non commitment of every senior management to TQM
• TQM does not operate in every facet of the organization.
TOTAL QUALITY MANAGEMENT
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• Companies under this category are more experienced in quality improvement when compared
with the drifters.
 Improvers
Organizations in this category have engaged in a process of quality improvement for between
five and eight years and during this time made important advances. They understand that total
quality involves long term cultural change and have recognized the importance of cultural
change and the importance of quality improvement. They explained that organizations in this
category are termed improvers because they are moving in the right direction and have made
significant progress but still have a long way to go. This is because the implementation of TQM
is dependent on a few managers to sustain the drive and direction of the improvement strategy.
Other characteristic of the improvers are:
• There is a high degree of closed-loop error prevention through the control of basic production/
operation and/ or service processes.
• A long-term and company-wide education and training program is in place.
• Benchmarking studies have been initiated and the data are used to facilitate improvement
activities.
• A ‘leadership culture’ is starting to emerge, with some strong quality improvement champions.
• Trust between al l levels of the organizational hierarchy exists.
TOTAL QUALITY MANAGEMENT
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 Award Winners
These organizations are termed award winners because they have attained a point in their TQM
maturity where the kind of culture, values and trust capabilities relationship and employee
involvement has become total in nature and encompasses the whole organization. In these types
of organization every member of staff recognizes the importance of quality and all effort is made
to maintain a quality standard. True competition based on product or service quality can only be
attained when an organization has gotten to a stage where it can compete for awards.
Organizations in this stage are believed to have manned the process of quality improvement as
the organizations have all it takes to achieve greater heights. (BARRIE G. DALE)
Other features of the award winners include:
• A number of successful organizational changes have been made.
• Business procedures and processes are efficient and responsive to customer needs.
• TQM is viewed sincerely by all employees as a way of managing the business to satisfy and
delight customers, both internal and external.
• Perception of key stakeholders (i.e. People, customer and society) of organizational
performance are surveyed and acted upon to drive improvement action.
 World class
These organizations are characterized by the total quality improvement and business strategies to
the delight of customers. The organizations that have attained this stage are always in search of
opportunities to improve their services to satisfy customers. It was further explained that the
focus of TQM here is on enhancing competitiveness by influencing the perception of customers
TOTAL QUALITY MANAGEMENT
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to the company through the continuous innovation of the service offering. The impact of TQM
feels more here as it aims at continuous improvement to enhance customer appeal. The task of
satisfying customers is a goal for everyone in the organization.
Other features of the world class include:
• Defining and communicating purpose and value
• Developing and applying a unique success model
• Placing a positive value on relationships
• Working in partnership with stakeholders
Effects OF TQM Practices on Organizational Performance
Performance measurement is an integral part of all management processes and traditionally has
involved management accountants through the use of budgetary control and the development of
financial indicators such as return on investment. However, it has been claimed that conventional
aggregate financial accounting indicators are inappropriate in TQM settings. Several authors
have claimed that an important part of ensuring that TQM leads to sustained improvements in
organizational profitability is that direct quantitative measures of manufacturing are used to
assess the effectiveness of managers’ efforts to manage the development and implementation of
TQM programs. With the growing awareness that quality of final products and services is a
strategic competitive variable, companies have recognized also that the concept of high quality
must be applied to production processes to generate quality products and minimize costs. TQM
has evolved as a philosophy that emphasizes the need to provide customers with highly valued
products and to do so by improvements in efficiency by way of eliminating waste, reducing lead
TOTAL QUALITY MANAGEMENT
21
times at all stages of the production process, reducing costs, developing people, and improving
continuously. It is an integral part of all management processes, traditionally involved in
accounting, such as return on investment through the use of budgetary control and financial
development indicators. However, it is argued that the traditional indicators of total financial
accounting improper settings TQM. Some authors argue that in order to ensure an important part
of a comprehensive quality control, which leads to the continuous improvement of the
profitability of the organization's direct quantitative measure of production, which are used for
assessing the development and implementation of control program management TQM. As people
become increasingly aware of the quality of the final product and services is a strategic
competitive variable, the Company recognized a high quality concept is also to be applied to the
production process, product quality and reduce costs. Total Quality Management has developed
into a philosophy that emphasizes the need to provide customers with high-value products and to
do so by improving the efficiency by reducing waste, reducing lead times, each stage of the
production process, reduce costs, develop human way, and still growing .
Today’s world offers a competitive market environment for active organizations. Therefore, a
business firm has to operate in an environment which constantly changes and comes up with
challenges. So, quality measurement and performance management with the help of Total quality
management are of vital importance.
 Quality management not only reduces production and financing risks, but also helps the
firm to create a certain brand image.
 Global organizations need to achieve total quality management because products
produced for exporting must meet certain qualities specified by government legislation of
the importing countries.
TOTAL QUALITY MANAGEMENT
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 Product performances can be viewed as a result of accumulation of product quality
management. Quality management makes the firm follow the policies and procedures in
the production stages and it ensures product performances.
 TQM and Customer satisfaction are interrelated factors as satisfaction of target market is
the long term effect of TQM. Total quality management focuses on humanizing quality
and implements best possible quality to match with customer expectations.
 Appointment scheduling in an organization reduces waiting time and enhances client
handling process
 Delivery process can be changed in accordance with the quality management system
(QMS) plan so that the product reaches prospects faster.
 Products with better quality generates from proper quality management. Such products
are long lasting and require no repairing. This ensures customer loyalty in the long run.
 Strengthens competitive position in the market.
 As external environment, market conditions and other government regulations change
frequently in today’s market economy, TQM enhances adaptability of an organization to
such changes.
 Employees are informed about the importance of quality and quality becomes the core
concern of not just quality control department but the entire human resources in an
organization. TQM requires teamwork which ultimately leads to cross departmental
knowledge sharing. Moreover, TQM ensures internal stakeholders such as
customer/supplier satisfactions.
 Increases job security and motivates human resources to achieve organizational goals.
TOTAL QUALITY MANAGEMENT
23
 Extends the ownership of the business process to each employee involved in the process
by empowering them to rectify mistakes on the spot without supervisor review or action.
This generates intrinsic motivation and creates an atmosphere of enthusiasm and
satisfaction among the workforce.
 TQM’s thrust on eliminating mistakes and improving productivity contributes to
accomplishment of targets faster. The resultant free time allows employees to enhance
their knowledge and apply their creativity to improve existing products and develop new
products.
 TQM’s lounge on quality leads to identifying skill-deficiencies in employees and
providing training and other interventions to bridge such deficiencies. Cross-functional
and cross-departmental teams allow employees to share their experience and solve issues
jointly, leading to benefits such as broadening skill-sets, and improvement of existing
skills.
 Focus on eliminating mistakes and bringing about process efficiency heralds a direct
approach such as counseling and other remedial actions to solve issues such as
absenteeism
 The enhanced productivity brought about by TQM translates to better profits for the
organization, and consequently better wages.
TOTAL QUALITY MANAGEMENT
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CONCLUSION
It can be concluded that TQM Total Quality Management (TQM) is a philosophy with the
enthusiasm of accomplishing the overall performance of the organization. This globally
recognized strategic technique has several benefits that make TQM trustworthy and applicable
toward the business people. These benefits may include improving consumer satisfaction,
focusing on employee motivation, reducing waste and improving overall performance of the
organization. TQM is a problem solving technique that particularly focuses on continuous
improvement of the quality of product, process and service. In this approach the management
and employee can work together for the overall improvement by using quality and management
tool aimed at increasing business and reducing losses in the long run.
All aspects of TQM practices should be effectively managed in an organization because each
factor in TQM practices improves different aspects of an organization’s performance. The
application of Total Quality Management brings forth all-round benefits and makes the
organization more competitive. It constitutes the application of sound management principles,
quantitative measurement methods and human resources with an underlying aspiration of
improving all processes within an organization, surpassing the current and future needs of the
customer and increasing organizational performance.
In the new business environment marked by demolition of barriers and free flow of information
and products, organizations retain their competitive advantage by reducing prices, improving
existing products and innovating new products. TQM is a business strategy that allows
organizations to achieve all this and much more.
TOTAL QUALITY MANAGEMENT
25
References
 Evans, James R., and William M. Lindsay. The Management and Control of Quality. 4th
ed. Cincinnati: South-Western, 1999.
 Crosby, Philip. Quality without Tears: The Art of Hassle-Free Management. New York:
McGraw-Hill, 1984
 Juran, Joseph M. Quality Control Handbook. 4th ed. New York: McGraw-Hill, 1988
 Garvin, David A. Managing Quality. New York: Free Press, 1988.
 Journal of Operations and Production Management, 20, no. 2, 2000, 225–248
 Medori, D., and D. Steeple, “A Framework for Auditing and Enhancing Performance
Measurement Systems,” International Journal of Operations and Production
Management, 20, no. 5, 2000, 520–533.
 Anderson, E.W., Fornell, C., Lehmann, R.T., 1994. Customer satisfaction, market share,
and profitability. Journal of Marketing 58, 53-66.
 Terzioski, M., Samson, D., 2000. The effect of company size on the relationship between
TQM strategy and organizational performance. TQM Magazine 12 (2), 144-148.
 Ittner, C.D., Larcker, D.F., 1996. Measuring the impact of quality initiatives on firm
financial performance. In: Fedor, D.F., Ghosh, S. (Eds.), Advances in Management of
Organization Quality, Vol. 1. JAI Press, Greenwich, CT, pp. 1-37.
 Prajogo D. I., Sohal A. S. 2003. The relationship between TQM practices, quality
performance, and innovation performance, The International Journal of Quality
Reliability Management 20(8), 901-918.
 Long bottom, D., Mayer, R., Casey, J., 2000. Marketing, total quality management and
benchmarking: exploring the divide. Journal of Strategic Marketing 8 (4), 327-340.
 Mohr-Jackson, I., 1998. Conceptualizing total quality orientation. European Journal of
Marketing 32 (1/2), 13 22.
 Seraph, J.V., Benson, P.G., Schroeder, R.G., 1989. An instrument for measur- ing the
critical factors of quality management. Decision Sciences 20 (4), 457-478.
 Rao, S.S., Solis, L.S., Raghu-Nathan, T.S., 1999. A framework for international quality
management research: development and validation of a research instrument. Total
Quality Management 10 (7), 1047-1075.
 Prajogo, D.I., Sohal, A.S., 2004.The multidimensionality of TQM practices in
determining quality and innovation performance—an empirical examination.
Technovation 24, 443-453.
TOTAL QUALITY MANAGEMENT
26
 Prajogo, D.I. Sohal, A.S. 2001. TQM and innovation: A literature review and research
framework, Technovation 21 (9) 539-558.
 Kaynak, H., 2003. The relationship between total quality management practices and their
effects on firm performance. Journal of Operational Management 21, 405-435.
 Prajogo, D.I., Sohal, A.S., 2006. The integration of TQM and technology/R&D
management in determining quality and innovation performance. Omega 34, 296-312.
 Choi, T.Y., Eboch, K., 1998. The TQM paradox: relations among TQM practices, plant
performance, and customer satisfaction. Journal of Operations Manage- ment 17 (1), 59-
75.
 Sila, I., 2007. Examining the effects of contextual factors on TQM and performance
through the lens of organizational theories: an empirical study. Journal of Operations
Management 25, 83-109
 Swiss, J. (1992). “Adapting TQM to Government.” Public Administration Review, 52,
356-362.
 Tichey, N. (1983). Managing Strategic Change. New York: John Wiley & Sons.
 Hill Stephen, 1991. “Why Quality Circles Failed but Total Quality Management Might
Succeed.” British Journal of Industrial Relations, 29(4), 541-568
 Hyde, A. (1992). “The Proverbs of Total Quality Management: Recharting the Path to
Quality Improvement in the Public Sector.” Public Productivity and Management
Review, 16(1), 25-37.
 Ishikawa, K, 1985.What Is Total Quality Control? The Japanese Way. Englewood Cliffs,
New Jersey, Prentice- Hall.
 Smith, AK, 1993. “Total Quality Management in the Public Sector.” Quality Progress,
June 1993, 45-48.
 Luanne Kelchner. (2009). Advantages & Disadvantages of Total Quality Management
Strategies. Total Quality Management for entrepreneurs. 12 (2), 34-57.
 Kaynak, H., 2003. The relationship between total quality management practices and their
effects on firm performance. Journal of Operational Management 21, 405-435.
 Powell, Thomas, C. (Jan 1995). Total Quality Management as Competitive Advantage: A
Review & Empirical StudyStrategic Management Journal (16.1)
 Vollmann, T., 1990. Changing Manufacturing Performance Measurements, in Turney, P.
B. B. (ed.) Performance Excellence in Manufacturing and Service Organisations,
Sarasota, FL, American Accounting Association, pp. 53-62.
TOTAL QUALITY MANAGEMENT
27
 Hall, R. W., Johnson, H. T. and Turney, P. B., 1991. Measuring up: Charting Pathways to
Manufacturing Excellence, Homewood, Illinois, Irwin
 Gilbert, G. (1992). “Quality Improvement in a Defense Organization.” Public
Productivity and Management Review, 16(1), 65-75.
 Managing Quality (p97~110) BARRIE G. DALE Blackwell publishing
 Total Quality Management (p9~11) Anders Hederstierna
 http://www.simplyquality.org/2000%20Summary/req_7-0.html
 http://courses.cit.cornell.edu/cuttingedge/productDev/11prodDev.htm

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Total Quality Management

  • 1. MGT 494 – PROJECT REPORT MEMBERS  SALMA KALSOOM USMAN - 036  ABU BAKAR BUTT – 047  MUHAMMAD IQBAL – 053 (GROUP LEADER)  SHAFAQ UROOJ – 167 Total Quality Management Practices & Their Effects on Organizational Performance ABSTRACT Total quality management (TQM) is considered a very important factor for the long-term success of an organization. TQM implementation has been an important aspect for improving organizational efficiency. The links between TQM and performance have been investigated by numerous scholars. While examining the relationship between TQM and performance scholars have used different performance types such as financial, innovative, operational and quality performance. Recent research on total quality management has examined the relationships between the Total quality management and organizational performance. TQM focuses on continuous process improvement within organizations to provide superior customer value and meet customer needs. TQM a popular guideline for organizational management is adopted for developing strategic info, maps and info charts for an information organization.Total Quality Management is defined as an integrative management philosophy and a set of guiding principles, representing the foundation of a continuously improving organization. Group No: 03
  • 2. TOTAL QUALITY MANAGEMENT 1 Table of Contents INTRODUCTION 3 EVOLUTION OF TOTAL QUALITY MANAGEMENT: 3 HISTORICAL BACKGROUND OF TOTAL QUALITY MANAGEMENT: 3 WHAT IS “QUALITY”? 4 WHAT IS TOTAL QUALITYMANAGEMENT? 4 THE DEFINITION: 5 NEED FOR TOTAL QUALITYMANAGEMENT: 5 SIGNIFICANCE OF TERM TQM 6 TOTAL: 6 QUALITY: 6 MANAGEMENT: 6 TOTAL QUALITYMANAGEMENT TQM CYCLE OR PROCESS: 6 TQM& ORGANIZATIONAL DEVELOPMENT 7 ANALYSIS/ DISCUSSION 8 PRINCIPLES OF TQM 10 MANAGEMENT COMMITMENT 10 EMPLOYEE EMPOWERMENT 10 FACT BASED DECISION MAKING 10 CONTINUOUS IMPROVEMENT 10 CUSTOMER FOCUS 10 IMPLEMENTATION OF TQM IN ORGANIZATIONS 11 STEPS IN MANAGING THE TRANSITION 12
  • 3. TOTAL QUALITY MANAGEMENT 2 LEVELS OF TOTAL QUALITYMANAGEMENT ADOPTION BY ORGANIZATIONS 14  UNCOMMITTED 15  DRIFTERS 16  TOOL PUSHERS 17  IMPROVERS 18  AWARD WINNERS 19  WORLD CLASS 19 EFFECTS OF TQM PRACTICES ON ORGANIZATIONAL PERFORMANCE 20 CONCLUSION 24 REFERENCES 25
  • 4. TOTAL QUALITY MANAGEMENT 3 INTRODUCTION Evolution of Total Quality Management: Quality management philosophy was evolved in Japan after the Second World War. An American expert Edwards Deming helped the Japanese to apply concepts of TQM. In 1968 the Japanese shaped the phrase Total Quality Control and became the world quality leader. In the 1980 the U.S. Navel Air Systems coined the TQM phrase. In 80’s most companies in the world started applying this concept and enhanced their productivity and profitability remarkably. Historical Backgroundof Total Quality Management: Although the concept of “Quality” is very old, today it’s perhaps the major preoccupation or organization worldwide. However, in the recent years, Total Quality Management (TQM) has captured the worldwide attention and is being adopted in many organizations, both profit & non profit. TQM is being accepted as a management philosophy. Quality in articles and artifacts produced by skilled craftsmen and artisans from the B.C. era, e.g. Goldsmiths, Silversmiths, Blacksmiths, potters, etc. Artists & Artisans Guilds in the Middle Ages spent years imparting quality skills and the works men had pride in making quality products. In 1946, the American Society for Quality Control was formed. In 1950, W. Edwards Deming, who learnt SQC from Shewhart, taught SPC & SQC to Japanese engineers and CEO’s. In 1960, the first Quality Control circles were formed. In 1970’s US managers were learning from Japan Quality Implementation miracles. In 1980’s Total Quality Management principles and methods became popular. In 1990’s the ISO 9000 model became the worldwide standard for QMS.
  • 5. TOTAL QUALITY MANAGEMENT 4 What is “Quality”? The word “Quality” stands for:  Q= Stands for quest/search for excellence.  U= Stands for understanding customers needs, i.e. to understand what makes a customer actually wants.  A= Stands for the action of a business to achieve customers appreciation.  L= Stands for leadership i.e. a firm should be determined to be a leader in terms of quality product.  I= Stands for involving all people  T= Stands for team spirit to work for a common goal  Y= Stands for yardstick (measuring rod) to measure progress. What is Total Quality Management? Total: Made up of whole Quality: Degree of excellence a product or service provides Management: Act, Art or Manager of handling, controlling, directing etc. “Total” it is the integration of the staff, suppliers, customers and other stakeholders. Away from party specific thinking to a more holistic approach. Q stands for “Quality” it’s the quality of the work and the process of the enterprise leading to Quality of products. M for management it stresses the leadership task and the quality of leadership.
  • 6. TOTAL QUALITY MANAGEMENT 5 The Definition: Total Quality Management is a system of management based on the principle that every member of staff must be committed to maintaining high standards of work in every aspect of a company’s operation.” “Quality” is “a degree of excellence; a distinguishing attribute.” That is, Quality” is the degree to which a product lives up to its performance, endurance, maintainability, and other attributes that a customer expects to receive from purchasing this product. In order to produce a quality product, one must instill the TQM concept into one’s product development process. The word “Total” mean the total of everything in an organization. That is, it covers every process, every job, every resource, every output, every person, every time and every place. According to the American Society for Quality Control (ASQC), Total Quality Management (TQM) “is a management approach to long term success through customer satisfaction. TQM is based on the participation of all members of an organization to improve processes, products, services, and the culture they work in. TQM benefits all organization members and society. The method for implementing this approach is found in the teachings of such quality leaders as Philip B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Karou Ishikawa, and J.M. Juran”. Need for Total Quality Management: TQM is needed for development of the best world class organization. Reduce cost and improve quality continuously. It also need for the development of problem solving skills and to build a happy bright place.
  • 7. TOTAL QUALITY MANAGEMENT 6 Significance of Term TQM Total: The responsibility for achieving Quality rests with everyone a business, no matter what their function. It recognizes the necessity to develop processes across the business, that together lead to the reliable degree of exact, agreed customer requirements. This will achieve the most competitive cost position and a higher return on investment. Quality: The prime task of any business is to understand the needs of the customer, then deliver the product or service at the agreed time, place and price, on every occasion. This will retain current customers, assist in acquiring new ones and lead to a subsequent increase in market share. Management: Top management leads the drive to achieve quality for customers, by communicating the business vision and values to all employees; ensuring the right business processes are in place; introducing and maintaining a continuous improvement culture. Total Quality Management TQM Cycle or Process: TQM processes are divided into four sequential categories: Plan, Do, Check, and Act. In planning phase, people define the problem to be addressed, collect relevant data, and ascertain the problem root cause; in the doing phase, people develop and implement a solution, and decide upon a measurement to gauge its effectiveness; in the checking phase people confirm the results through before and after data comparison; in the acting phase, people document their results, inform others about process changes, and make recommendations for the problem to be addressed in the next PDCA cycle.
  • 8. TOTAL QUALITY MANAGEMENT 7 TQM& Organizational Development TQM is considered to be an important factor in the organizational development. Prior studies suggest that the TQM strategy that focuses on increasing customer levels of satisfaction does have a significant and positive impact on performance. Ittner and Larcker, for example, suggest that attaining customer satisfaction is thought to increase the profits of the organization by decreasing costs through fewer returns and increasing revenues through customer loyalty. The links between TQM and performance have been investigated by numerous scholars. While examining the relationship between TQM and performance scholars have used different performance types such as financial, innovative, operational and quality performance. Although the effects of TQM on various performance types are inconsistent, quality performance generally indicated strong and positive relations. Studies have claimed that marketing and TQM are complement- tarry business philosophies. From Seraph et al., many studies have attempted to develop an appropriate set of critical quality management constructs to represent an integrated approach to TQM implement- titian in a business unit. Some scholars have claimed that the effects of TQM practices on various types of performance measures differ. In addition, few empirical studies have investigated the mediating effect (indirect relationship) of one type of
  • 9. TOTAL QUALITY MANAGEMENT 8 performance measure on the relationship between TQM practices and another type of performance measure. Therefore, the TQM concept caught the attention of all aspects of the business and academics. A large number of articles published in this respect are very concerned about the quality of evidence. In the last decade, to improve the quality became one of the most important organizational strategies for achieving competitive advantage. Improving the quality and organization can offer their products and services are crucial for the expansion of global market competition. TQM started with the main needs of the organization assumed the cooperation of staff with one another to achieve the quality of service for customers. People can control the processes of production / services, in order to avoid mistakes thus achieving quality. TQM process also depends on the set point and all members of the organization share the same faith. The concept of quality has been regarded as the market is not fully competitive basis, to be considered a strategic enterprise resource migrate non-price factors. In other words, the quality of the product treated as a multidimensional construct that needs to be managed rather than one- dimensional property, which leads to the ability to perform dynamic business ANALYSIS/ DISCUSSION TQM is a management philosophy that seeks to integrate all organizational functions (marketing, finance, design, engineering, and production, customer service, etc.) to focus on meeting customer needs and organizational objectives. TQM views an organization as a collection of processes. It maintains that organizations must strive to continuously improve these processes by incorporating the knowledge and experiences of workers. The simple objective of TQM is “Do the right things, right the first time, every
  • 10. TOTAL QUALITY MANAGEMENT 9 time.” TQM is infinitely variable and adaptable. Although originally applied to manufacturing operations, and for a number of years only used in that area, TQM is now becoming recognized as a generic management tool, just as applicable in service and public sector organizations. There are a number of evolutionary strands, with different sectors, creating their own versions from the common ancestor. TQM is the foundation for activities, which include:  Commitment by senior management and all employees  Meeting customer requirements  Reducing development cycle times  Just in time/demand flow manufacturing  Improvement teams  Reducing product and service costs  Systems to facilitate improvement  Line management ownership  Employee involvement and empowerment  Recognition and celebration  Challenging quantified goals and benchmarking  Focus on processes / improvement plans  Specific incorporation in strategic planning This shows that TQM must be practiced in all activities, by all personnel, in manufacturing, marketing, engineering, R&D, sales, purchasing, HR, etc.
  • 11. TOTAL QUALITY MANAGEMENT 10 Principles of TQM The key principles of TQM are as following: Management Commitment  Plan (drive, direct)  Do (deploy, support, participate)  Check (review)  Act (recognize, communicate, revise) Employee Empowerment  Training  Suggestion scheme  Measurement and recognition  Excellence teams Fact Based Decision Making  SPC (statistical process control)  DOE, FMEA  The 7 statistical tools  TOPS (Ford 8D – team-oriented problem solving) Continuous Improvement  Systematic measurement and focus on CONQ  Excellence teams  Cross-functional process management  Attain, maintain, improve standards Customer Focus  Supplier partnership  Service relationship with internal customers
  • 12. TOTAL QUALITY MANAGEMENT 11  Never compromise quality  Customer driven standards Implementation of TQM in Organizations A preliminary step in TQM implementation is to assess the organization’s current reality. Relevant preconditions have to do with the organization’s history, its current needs, precipitating events leading to TQM, and the existing employee quality of working life. If the current reality does not include important preconditions, TQM implementation should be delayed until the organization is in a state in which TQM is likely to succeed. If an organization has a track record of effective responsiveness to the environment, and if it has been able to successfully change the way it operates when needed, TQM will be easier to implement. If an organization has been historically reactive and has no skill at improving its operating systems, there will be both employee skepticism and a lack of skilled change agents. If this condition prevails, a comprehensive program of management and leadership development may be instituted. A management audit is a good assessment tool to identify current levels of organizational functioning and areas in need of change. An organization should be basically healthy before beginning TQM. If it has significant problems such as a very unstable funding base, weak administrative systems, lack of managerial skill, or poor employee morale, TQM would not be appropriate. However, a certain level of stress is probably desirable to initiate TQM. People need to feel a need for a change. Tichey, N. (1983) addresses this phenomenon be describing building blocks which are present in effective organizational change. These forces include departures from tradition, a crisis or galvanizing event, strategic decisions, individual “prime movers,” and action vehicles. Departures from tradition are activities, usually at lower levels of the organization,
  • 13. TOTAL QUALITY MANAGEMENT 12 which occur when entrepreneurs move outside the normal ways of operating to solve a problem. A crisis, if it is not too disabling, can also help create a sense of urgency which can mobilize people to act. In the case of TQM, this may be a funding cut or threat, or demands from consumers or other stakeholders for improved quality of service. After a crisis, a leader may intervene strategically by articulating a new vision of the future to help the organization deal with it. A plan to implement TQM may be such a strategic decision. Such a leader may then become a prime mover, who takes charge in championing the new idea and showing others how it will help them get where they want to go. Finally, action vehicles are needed and mechanisms or structures to enable the change to occur and become institutionalized. Steps in Managing the Transition Hill Stephen(1991) have outlined the basic steps in managing a transition to a new system such as TQM: identifying tasks to be done, creating necessary management structures, developing strategies for building commitment, designing mechanisms to communicate the change, and assigning resources. Task identification would include a study of present conditions (assessing current reality, as described above); assessing readiness, such as through a force field analysis; creating a model of the desired state, in this case, implementation of TQM; announcing the change goals to the organization; and assigning responsibilities and resources. This final step would include securing outside consultation and training and assigning someone within the organization to oversee the effort. This should be a responsibility of top management. In fact, the next step, designing transition management structures, is also a responsibility of top management. In fact, Hyde (1992) assert that management must be heavily involved as leaders rather than relying on a separate staff person or function to shepherd the effort. An organization wide steering committee
  • 14. TOTAL QUALITY MANAGEMENT 13 to oversee the effort may be appropriate. Developing commitment strategies was discussed above in the sections on resistance and on visionary leadership. To communicate the change, mechanisms beyond existing processes will need to be developed. Special all-staff meetings attended by executives, sometimes designed as input or dialog sessions, may be used to kick off the process, and TQM newsletters may be an effective ongoing communication tool to keep employees aware of activities and accomplishments. Management of resources for the change effort is important with TQM because outside consultants will almost always be required. Choose consultants based on their prior relevant experience and their commitment to adapting the process to fit unique organizational needs. While consultants will be invaluable with the initial training of staff and TQM system design, employees (management and others) should be actively involved in TQM implementation, perhaps after receiving training in change management which they can then pass on to other employees. A collaborative relationship with consultants and clear role definitions and specification of activities must be established. In summary, first assess preconditions and the current state of the organization to make sure the need for change is clear and that TQM is an appropriate strategy. Leadership styles and organizational culture must be congruent with TQM. If they are not, this should be worked on or TQM implementation should be avoided or delayed until favorable conditions exist. Though it would be a difficult, comprehensive, and long-term process, leaders will need to maintain their commitment, keep the process visible, provide necessary support, and hold people accountable for results. Use input from stakeholder (clients, referring agencies, funding sources, etc.) as possible; and, of course, maximize employee involvement in design of the system.
  • 15. TOTAL QUALITY MANAGEMENT 14 Levels of Total Quality Management Adoption by Organizations An illustration of TQM in Organizations is Total Quality Management is a management approach that originated in the 1950s and has steadily become more popular since the early 1980s. Total Quality is a description of the culture, attitude and the organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company’s operations, with processes being done right the first time and defects and waste eradicated from operations. Total Quality Management, TQM, is a method by which management and employees can become involved in the continuous improvement of the production of goods and services. It is a combination of quality and management tools aimed at increasing business and reducing losses due to wasteful practices. The Six different levels of TQM implementation, this includes uncommitted, drifters, tool pushers’ improvers’ award winners and world class. According to them, these stages do not TQM Continous Improvement Control Culture Commitment Cooperation Customer Focus
  • 16. TOTAL QUALITY MANAGEMENT 15 necessarily represent the stages through which organizations pass on their TQM journey. These levels are to help organization in identifying their weaknesses and proffering solutions to them through the use of continuous improvement. (Dale and Light burn 1992)  Uncommitted This stage represents organizations that have not started a formal procedure of quality improvement. Organizations at this stage view quality improvement as an added cost and thus have no investment in quality improvement program such as training of employees. Organizations in this stage are termed uncommitted because they are not aware of the benefit of quality improvement and lack an appropriate quality improvement plan. The management of these organizations is characterized by an emphasis on return of sales and net asset employed. For example: non-attendance the meeting, failure to respond to requests the data, and not doing what they had agreed to do. Other common features of this level include: • A major concern for meeting sales target. • Employees show little or no concern for quality. • Full inspection of materials is carried on incoming material and at strategic points during the process of production. • Lack of communication among the various units of production even between the top management and front line employees. • Minimal contact with customers.
  • 17. TOTAL QUALITY MANAGEMENT 16  Drifters These are organizations that have engaged in a process of quality improvement for up to three years and have followed the available advice and wisdom of TQM. The management of the organizations at this stage tends to review the performance of the firm based on the implementation of TQM and expect immediate gains from it. These organizations view TQM as a program rather than a process, thus making the policy have a low profile among employees. Organizations with such an approach to management are termed drifter because they drift from one program to the other in a start stop fashion with concepts, ideas and initiative being reborn and re-launched under different guises. Organizations which fall within this stage usually have no plan for the deployment of TQM philosophy throughout the organization thus limiting the implementation of TQM to the managers while leaving the shop floor out of the implementation process. Other common features of this level include: • Managements are overly susceptible to outside interventions and easily get distracted by the latest “fads” which are put to them under various guises (i.e. they are quality fashion victims). • The quality department has low status within the organization. • Continuous improvement activities are little more than cosmetic ‘off-line’ motivation programs, with little impression on the company’s organizational structure, internal relationships, and overall business direction.
  • 18. TOTAL QUALITY MANAGEMENT 17 • Any team working is superficial and departments only tend to co-operate in order to lay the blame on another department. Considerable in-fighting, rivalry and ‘politics’ exist between departments • No real changes in corporate culture have been made since the start of the TQM initiative. The activities associated with TQM are not given time to come to fruition before they are discarded and replaced by others. • A fear of failure and uncertainty pervades the organization and there is the view that TQM will be sidelined in the medium term.  Tool pushers Organizations in this category look at quality improvement programs, but in most cases fail to use such tools appropriately. They adopt quality management tools such as quality cycles, quality improvement groups. These organizations often blame the failure of TQM on the tools adopted. It explained that organizations in this stage find it difficult to sustain the momentum of its improvement initiatives and it is continually on the lookout for new ideas. (Anders Hederstierna) Some characteristics of the drifters include: • A major concern for meeting sales target. • Solving current problems rather than future problems • Non commitment of every senior management to TQM • TQM does not operate in every facet of the organization.
  • 19. TOTAL QUALITY MANAGEMENT 18 • Companies under this category are more experienced in quality improvement when compared with the drifters.  Improvers Organizations in this category have engaged in a process of quality improvement for between five and eight years and during this time made important advances. They understand that total quality involves long term cultural change and have recognized the importance of cultural change and the importance of quality improvement. They explained that organizations in this category are termed improvers because they are moving in the right direction and have made significant progress but still have a long way to go. This is because the implementation of TQM is dependent on a few managers to sustain the drive and direction of the improvement strategy. Other characteristic of the improvers are: • There is a high degree of closed-loop error prevention through the control of basic production/ operation and/ or service processes. • A long-term and company-wide education and training program is in place. • Benchmarking studies have been initiated and the data are used to facilitate improvement activities. • A ‘leadership culture’ is starting to emerge, with some strong quality improvement champions. • Trust between al l levels of the organizational hierarchy exists.
  • 20. TOTAL QUALITY MANAGEMENT 19  Award Winners These organizations are termed award winners because they have attained a point in their TQM maturity where the kind of culture, values and trust capabilities relationship and employee involvement has become total in nature and encompasses the whole organization. In these types of organization every member of staff recognizes the importance of quality and all effort is made to maintain a quality standard. True competition based on product or service quality can only be attained when an organization has gotten to a stage where it can compete for awards. Organizations in this stage are believed to have manned the process of quality improvement as the organizations have all it takes to achieve greater heights. (BARRIE G. DALE) Other features of the award winners include: • A number of successful organizational changes have been made. • Business procedures and processes are efficient and responsive to customer needs. • TQM is viewed sincerely by all employees as a way of managing the business to satisfy and delight customers, both internal and external. • Perception of key stakeholders (i.e. People, customer and society) of organizational performance are surveyed and acted upon to drive improvement action.  World class These organizations are characterized by the total quality improvement and business strategies to the delight of customers. The organizations that have attained this stage are always in search of opportunities to improve their services to satisfy customers. It was further explained that the focus of TQM here is on enhancing competitiveness by influencing the perception of customers
  • 21. TOTAL QUALITY MANAGEMENT 20 to the company through the continuous innovation of the service offering. The impact of TQM feels more here as it aims at continuous improvement to enhance customer appeal. The task of satisfying customers is a goal for everyone in the organization. Other features of the world class include: • Defining and communicating purpose and value • Developing and applying a unique success model • Placing a positive value on relationships • Working in partnership with stakeholders Effects OF TQM Practices on Organizational Performance Performance measurement is an integral part of all management processes and traditionally has involved management accountants through the use of budgetary control and the development of financial indicators such as return on investment. However, it has been claimed that conventional aggregate financial accounting indicators are inappropriate in TQM settings. Several authors have claimed that an important part of ensuring that TQM leads to sustained improvements in organizational profitability is that direct quantitative measures of manufacturing are used to assess the effectiveness of managers’ efforts to manage the development and implementation of TQM programs. With the growing awareness that quality of final products and services is a strategic competitive variable, companies have recognized also that the concept of high quality must be applied to production processes to generate quality products and minimize costs. TQM has evolved as a philosophy that emphasizes the need to provide customers with highly valued products and to do so by improvements in efficiency by way of eliminating waste, reducing lead
  • 22. TOTAL QUALITY MANAGEMENT 21 times at all stages of the production process, reducing costs, developing people, and improving continuously. It is an integral part of all management processes, traditionally involved in accounting, such as return on investment through the use of budgetary control and financial development indicators. However, it is argued that the traditional indicators of total financial accounting improper settings TQM. Some authors argue that in order to ensure an important part of a comprehensive quality control, which leads to the continuous improvement of the profitability of the organization's direct quantitative measure of production, which are used for assessing the development and implementation of control program management TQM. As people become increasingly aware of the quality of the final product and services is a strategic competitive variable, the Company recognized a high quality concept is also to be applied to the production process, product quality and reduce costs. Total Quality Management has developed into a philosophy that emphasizes the need to provide customers with high-value products and to do so by improving the efficiency by reducing waste, reducing lead times, each stage of the production process, reduce costs, develop human way, and still growing . Today’s world offers a competitive market environment for active organizations. Therefore, a business firm has to operate in an environment which constantly changes and comes up with challenges. So, quality measurement and performance management with the help of Total quality management are of vital importance.  Quality management not only reduces production and financing risks, but also helps the firm to create a certain brand image.  Global organizations need to achieve total quality management because products produced for exporting must meet certain qualities specified by government legislation of the importing countries.
  • 23. TOTAL QUALITY MANAGEMENT 22  Product performances can be viewed as a result of accumulation of product quality management. Quality management makes the firm follow the policies and procedures in the production stages and it ensures product performances.  TQM and Customer satisfaction are interrelated factors as satisfaction of target market is the long term effect of TQM. Total quality management focuses on humanizing quality and implements best possible quality to match with customer expectations.  Appointment scheduling in an organization reduces waiting time and enhances client handling process  Delivery process can be changed in accordance with the quality management system (QMS) plan so that the product reaches prospects faster.  Products with better quality generates from proper quality management. Such products are long lasting and require no repairing. This ensures customer loyalty in the long run.  Strengthens competitive position in the market.  As external environment, market conditions and other government regulations change frequently in today’s market economy, TQM enhances adaptability of an organization to such changes.  Employees are informed about the importance of quality and quality becomes the core concern of not just quality control department but the entire human resources in an organization. TQM requires teamwork which ultimately leads to cross departmental knowledge sharing. Moreover, TQM ensures internal stakeholders such as customer/supplier satisfactions.  Increases job security and motivates human resources to achieve organizational goals.
  • 24. TOTAL QUALITY MANAGEMENT 23  Extends the ownership of the business process to each employee involved in the process by empowering them to rectify mistakes on the spot without supervisor review or action. This generates intrinsic motivation and creates an atmosphere of enthusiasm and satisfaction among the workforce.  TQM’s thrust on eliminating mistakes and improving productivity contributes to accomplishment of targets faster. The resultant free time allows employees to enhance their knowledge and apply their creativity to improve existing products and develop new products.  TQM’s lounge on quality leads to identifying skill-deficiencies in employees and providing training and other interventions to bridge such deficiencies. Cross-functional and cross-departmental teams allow employees to share their experience and solve issues jointly, leading to benefits such as broadening skill-sets, and improvement of existing skills.  Focus on eliminating mistakes and bringing about process efficiency heralds a direct approach such as counseling and other remedial actions to solve issues such as absenteeism  The enhanced productivity brought about by TQM translates to better profits for the organization, and consequently better wages.
  • 25. TOTAL QUALITY MANAGEMENT 24 CONCLUSION It can be concluded that TQM Total Quality Management (TQM) is a philosophy with the enthusiasm of accomplishing the overall performance of the organization. This globally recognized strategic technique has several benefits that make TQM trustworthy and applicable toward the business people. These benefits may include improving consumer satisfaction, focusing on employee motivation, reducing waste and improving overall performance of the organization. TQM is a problem solving technique that particularly focuses on continuous improvement of the quality of product, process and service. In this approach the management and employee can work together for the overall improvement by using quality and management tool aimed at increasing business and reducing losses in the long run. All aspects of TQM practices should be effectively managed in an organization because each factor in TQM practices improves different aspects of an organization’s performance. The application of Total Quality Management brings forth all-round benefits and makes the organization more competitive. It constitutes the application of sound management principles, quantitative measurement methods and human resources with an underlying aspiration of improving all processes within an organization, surpassing the current and future needs of the customer and increasing organizational performance. In the new business environment marked by demolition of barriers and free flow of information and products, organizations retain their competitive advantage by reducing prices, improving existing products and innovating new products. TQM is a business strategy that allows organizations to achieve all this and much more.
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