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report on total quality management
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ORGANIZATIONAL CHANGE AND
DEVELOPMENT
TOTAL QUALITY MANAGEMENT
- AS A PRACTICAL APPROACH IN TODAYS
COMPANYS
ABSTRACT1
This case paper talks about Total Quality Management , its history, its benefits, its 7 tools- old and new, how it
is related to Organizational Development(OD) and how it leads to an error or defects free processes, products
and services. It is a project management technique or strategy that is implemented to assure that an awareness of
quality is embedded in all phases of the project from conception to completion. Used in industries from
manufacturing to aerospace, total quality management requires the careful and consistent review of all phases of
a project, and the coordinated effort of all involved. Standards must be developed, procedures well defined, and
all involved must follow strict adherence to the plan to assure its success.
The first paradigm of the strategy, “total,” calls for an integrated system of dependent variables. Here, planning
is of the utmost importance. In the planning stage obstacles to success can be identified, confronted, and
conquered. All parties involved, from workers to management must become familiar with the process and
committed to its success.
The second paradigm of the total quality management (TQM) strategy, “quality,” requires that once a standard
has been established it must never be violated. This necessitates a certain amount of cross training, so that one
party along the chain of project management can spot the errors that might have occurred at a prior stage in the
process. This not only assures quality, but also tends to inspire greater commitment and conscientiousness
among the individuals involved.
The third paradigm of total quality management (TQM) is management itself. In order to insure success, the
strategy must function as a cohesive element that unites the individual efforts of all involved. The system must
be managed properly in order to insure the quality of the strategy itself.
1. INTRODUCTION
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1.1) TOTAL QUALITY MANAGEMENTTotal Quality Management or TQM is an integrative philosophy of management for continuously improving the
quality of products and processes. It is a management philosophy, a paradigm, a continuous improvement
approach of doing business through a new management model. Under TQM, emphasizing the quality of the
product or service predominates. TQM expands beyond statistical process control to embrace a wider scope of
management activities of how we manage people and organizations by focusing on the entire process, not just
simple measurements. The TQM philosophy evolved from the continuous improvement philosophy with a focus
on quality as the main dimension of business.
TQM is a comprehensive management system which:
Views an organization as an internal system with a common aim rather than as individuals working to
maximize their own performances.
Focuses on meeting owners’/customers’ needs by providing quality services at a cost that provides value
to the owners/customers
Emphasizes on teamwork and a high level of participation by all employees
Drive for continuous improvement in all operations
Recognizes that everyone in the organization has owners/customers who are either internal or external
Focuses on the way tasks are accomplished rather than simply what tasks are accomplished
Total= Made up of whole
Quality= Degree of excellence a product/service provides.
Management= Act/art (manner of handling, controlling, directing, etc.)
TQM is an art of Managing the whole to achieve excellence. TQM is an organizational change intervention that
is concerned with quality. According to Goetsch & Davi “TQM is an approach to doing business that attempts
to maximize the competitiveness of an organization through the continual improvement of the quality of its
products, services, people, processes and environment
1.2) HISTORY OF TQM
The roots of Total Quality Management (TQM) can be traced back to early 1920s when statistical theory was
first applied to product quality control. This concept was further developed in Japan in the 40s led by
Americans, such as Deming, Juran and Feigenbaum. The focus widened from quality of products to quality of
all issues within an organization. Total quality management (TQM) became extremely popular during the 1980s
and early 1990s as OD intervention.
TQM interventions utilized and established quality techniques and programs that emphasize quality processes,
rather than achieving quality by inspecting products and services after processes had been completed. The
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important concept of continuous improvement embodied by TQM has carried over into other OD interventions.
TQM appears to be highly congruent with OD approaches and values because of the emphasis on creating an
organizational culture that features extensive participation, an emphasis on teams and teamwork, cooperation
between teams and units, the generation of valid data and continuous learning.
1.3) TQM BELIEFS
Presented here are universal total quality management beliefs.
Customer satisfaction is the measure of quality
Everyone has owners/customers; everyone is an owner/customer
Quality improvement is a continuous process
Analyzing the processes used to create products and services is the key to quality improvement
Measurement, a skilled use of analytical tools, and employee involvement are critical sources of quality
improvement ideas and innovations
Sustained total quality management is not possible without active, visible, consistent, and enabling
leadership by managers at all levels
If improvement of the quality of products and services is not continuous then it’s tough to survive in the
market.
1.4 NEED OF TQM
Rising Customer Expectations4
Increasing Competitive Pressure
Changing perceptions of customers
Internal pressure for improvement
Managers and workforce perceptions to survive
2. RESEARCH OBJECTIVES
The following objectives of this dissertation an be stated: To study the concept of TQM, its tools and how it benefits company performance. The research on TQM methods used by various companies in todays time. To identify new trends and needs in TQM.
3. RESEARCH METHODOLOGY The entire case will represent TQM in todays times based on the secondary data available.Secondary data collection: large amount of secondary data is available in the forms of articles, journals, and previously conducted researches on the similar topics. This data will be collected to determine some of the broad trends prevalent in TQM. We will be going through books on TQM , annual reports of companies that use TQM, interviews given by TQM specialists etc.
4. REVIEW OF LITRATURE
4.1) TQM as operational strategy
The literature presents so many definitions and descriptions of TQM that sometimes it seems as if each author
has its own definition and each organization has its own implementation (Watson & Korukonda, 1995).
However, no TQM discussion is complete without acknowledging the work of the five best known TQM
experts, or ‘quality gurus’: Deming, Juran, Feigenbaum, Crosby and Ishikawa. In a recent study, Reed, Lemark,
and Mero (2000) systematically reviewed the work and ideas of these TQM experts – Deming (1982, 1986),
Juran (1974, 1988, 1989, 1992), Crosby (1979, 1996), Feigenbaum (1951, 1983, 1991), and Ishikawa (1985) –
and pointed out the shared similarities on TQM elements.
This review revealed that they all agreed on the importance of the following six key elements: customer
satisfaction, cost reduction, leadership and top management commitment, training and education, teamwork and
organizational culture. In addition to the complete agreement reflected in the above six elements, Reed et al.
(2000) also found
commonly shared differences regarding the other TQM elements. The role statistical tools play in improving
quality control was emphasised by everyone except Crosby (1996), who implied that the use of statistical
control was not a core quality management issue. Similarly, while Feigenbaum, Ishikawa, and Juran stressed
product design, Deming
and Crosby did not. With the exception of Crosby, all mentioned planning, but each dealt
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with different aspects of it. Juran covered all facets of planning, Deming was concerned mostly with the stages
of planned action, while Feigenbaum and Ishikawa focused on
feedback and control.
Some of the definitions and TQM elements that other researchers had proposed were: TQM can be defined as a
set of techniques and procedures used to reduce or eliminate variation from a production process or service-
delivery system in order to improve efficiency, reliability, and quality (Steingrad & Fitzgibbons, 1993).
Vuppalapati, Ahire, and Gupta (1995) stated that TQM is an integrative philosophy of management for the
continuous improvement of product and process quality in order to achieve customer satisfaction. According to
Dean and Bowen (1994), TQM is a management philosophy or an approach characterised by principles,
practices, and techniques. They pointed out three principles that most quality frameworks had in common –
customer focus, continuous improvement, and teamwork. Each principle is implemented through a set of
practices, and these practices, in turn, are supported by a broad set of techniques. Anderson, Rungtusanatham,
and Schroeder (1994) identified some core TQM components derived from Deming’s 14-point programme
using the Delphi method. These components reflect Deming’s principles and are either explicitly or implicitly
similar to the factors included in the other quality management frameworks. However, its weakness is the lack
of a systematic scale development and content validity (Motwani, 2001).
Joseph, Rajendran, and Kamalanabhan (1999) identified the following 10 TQM factors organisational
commitment, human resource management, supplier integration, quality policy, product design, the role of the
quality department, quality information systems, technology utilisation, operating procedures and training. They
also developed a measurement that can be used to evaluate the extent to which these TQM practices are
deployed in an organisation. According to Motwani (2001), the philosophy of TQM could be visualised as
constructing a house with top management commitment being the foundation or base. On top of a solid
foundation, four pillars are constructed that include process management, quality measurement and control,
employee training, and customer focus.
In a recent empirical study, Rahman and Bullock (2005) also explored the relationship between TQM practices
and organisational performance using data from 261 Australian manufacturing companies. Adopted from Dow
et al. (1999) and Power, Amrik, and Rahman (2001), they formed a model with 10 TQM constructs: workforce
commitment, shared vision, customer focus, use of teams, personnel training, cooperative supplier relations,
computer base technologies, just-in-time principles, technology utilisation, and continuous improvement
enablers. The first six constructs were considered as the soft elements, and the remaining four constructs as the
hard elements of TQM. Elements of soft TQM are essentially dimensions of human resource management, like
workforce commitment, training and so on, while hard elements relate to continuous improvement or treat
organisations as total systems (Rahman & Bullock, 2005). The results of this study suggested that, in general,
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the soft TQM dimensions are significantly related to organisational performance. These findings are broadly
similar to that of Samson and Terziovski (1999), Powell (1995), and Dow et al. (1999).
In addition to direct effects, soft TQM elements also have an indirect effect on performance through their effect
on hard TQM elements. This study also provided evidence that certain hard TQM elements have a significant
impact on performance and suggested that for having such an impact, hard TQM elements need a support from
elements of soft TQM.
4.2) Stages of TQM and its Tools
The first stage of development is a preparation phase in which managers discuss the approach toward TQM.
They “identify and collect information about the organization in the prime areas where improvement will have
most impact on performance”, while exploring their knowledge on TQM by attending internal and external
seminars. Commitment and leadership are two of the most important elements in quality management.
Therefore, management needs to be fully familiarized with TQM and fully understand the objectives, the
methodology, and its impacts on the company operations before disseminating them company-wide. According
to Kume (1996), many companies do not introduce TQM throughout the company straight away. They try it in
one part of the organization to see if it can be applied in other departments of responsibility.
After TQM effectiveness is assured, the second stage is for management to decide which department will be
responsible for its promotion. Many companies assign this role to their planning office or QC Circle Office.
Then management formally announces that TQM will be introduced in the company and it will be implemented
in company-wide operation. At the same time, specific training is provided and the activities are conducted
among the different levels of the company. According to Kume, at this stage, the most important challenge for
the organization is how to overcome the negative attitude of the part of the people who are showing resistance
to change.
The third phase involves linkage of the TQM with management policy, and communicating that linkage. As
Kume suggests, it is often the case that policy is only a written document of management and never really is
implemented. Thus, linking the policy with improvement activity enables the activity to be implemented
systematically across the whole company. Once the activities are seen to be effective, they are standardized and
expanded company wide.
As a cross-functional operation, after activities are well established, the company often tries to tackle problems
that affect the company as a whole. Also a management audit takes place so as to see how the policy is
implemented in the organization. Management is expected to examine not only the implementation of the
activities but also the outcome of those activities and provide appropriate comments and guidance. Application
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for a quality award such as the Malcolm Baldrige Award or the Deming Prize can be one of the stimuli for the
organization.
In the final phase, the main issues will be in regard to how to maintain the improved company-wide quality
management. Kume describes if not looked after properly how a system deteriorates with time. It is important to
make sure that the quality level does not deteriorate once it has been improved. This underscores the importance
for the company to improve and enhance its activities in a systematic manner from time to time.
Total Quality Management (TQM) has seven basic tools. Kaoru Ishikawa contends that 95% of a company's
problems can be solved using these seven tools. The tools are designed for simplicity. Only one, control charts
require any significant training. The tools are:
• Flow Charts
• Ishikawa Diagrams (fishbone charts)
• Checklists
• Pareto Charts
• Histograms
• Scattergrams
• Control Charts
5. COMPANIES USING TQM PRINCIPLES
5.1 Exxon Mobil:
TQM ensures quality, considering the customer or the end-user. With the fuel business ever so competitive,
Exxon felt the need to explore customer-related issues by using TQM rather than only relying on competitive
pricing—becoming one of the companies that benefited from TQM. According to BrainMass, Exxon “treated
quality as an opportunity for process improvement rather than as cost.” The challenge for Exxon was to re-
brand the company as a “trusted” fuel provider, and that also meant their service stations—owners were asked
to emulate Exxon’s corporate beliefs into their franchises or gas stations that bore the Exxon name and sold
their products.
Through analyzing customers' need and wants and by using TQM to implement those wants and needs—they
re-branded themselves from the disaster of the Exxon-Valdez oil spill of 1989. They looked at 4 areas of the
end-user and consumer confidence including higher quality products, efficient and easy-to-use services and
products, better explanations of warranties and guarantees, and being truthful in all of their advertising efforts.
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By doing so, the company was able to embark on the new and the workable and leave the “consumer view” of
the company on the back burner.
5.2 XEROX
According to Mark Chatfield’s article TQM: It Really Works, published on the All Business website, many
American companies between “1960 to 1990 lost 40 percent of market share to foreign competitors, while
Japan increased its foreign market by 500 percent.” With fear of closing down, Xerox fought back using TQM
to regain their market share.
They implemented TQM by opening the Palo Alto Research Center (PARC), which focused on ways to emerge
as a leader in the printer/copy/fax market. Their main goal: “Innovation is everywhere; the problem is learning
from it.” They also focused on benchmarking and leadership and re-thought their suppliers to come up with the
best quality products that could compete globally. Xerox later went on to win the Baldridge Award for their
TQM efforts.
5.3 RELIANCE INDUSTRIES:
During the year, several new initiatives were taken to improve and strengthen quality management systems at
our sites.
• At the RPCL facility, Quality Control systems were put in place at the time of plant start up - resulting in
reliable results from the start.
• Total Quality Management was introduced in all the laboratories at Jamnagar.
•The 5S programme was introduced at laboratories for inventory and document management.
• Inter laboratory testing across the Reliance group has been made a regular feature to monitor the reliability of
analytical services.
• Suggestion schemes have been introduced to encourage the involvement of all employees in quality related
activities - eighteen employees received awards. Reliance's efforts on the quality front continued to receive
recognitions.
• The Jamnagar laboratory received recognition on the analytical front from CEMILAC Reliance Industries
Limited, Maker Chambers IV, Nariman Point, Mumbai (Centre for Military Airworthiness and Certification) for
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its high level of Quality Confidence and Control Measures. For each month during the year, Reliance received
Golden certificates from Shell Global Services for Excellence in Reliability of Testing and Results. Reliance's
laboratory was accredited for conforming to QMS as per ISO/IEC 17025 by NABL.
5.4 GE (General Electric):
GE has taken the six sigma process and developed it into an amazing feat that has brought about a change in
their organization that cannot be looked over or disregarded when trying to fine an example of an exemplary
performance of any organization. They have done so by using the six sigma quality system and implementing it
every aspect of their business. GE defines six sigma as a “highly disciplined process that helps us focus on
developing and delivering near-perfect products and services.” The article from the website goes on to say that
to achieve six sigma qualities a process must produce no more than 3.4 defects per million opportunities.” An
"opportunity" is defined as a chance for a nonconformance or an issue with a raw material or supplier. We all
know the jingle that we have seen on GE commercials for years, “GE, we bring good things to life.” Their
people are among the most highly trained work force on the planet as they try and solve the issues that are
plaguing the world today. They are also involved in environmental movements as the website boasts that GE
employees are responsible for, “reducing GHG emissions by 250,000 metric tons and saving the company 130
million dollars by organizing treasure hunts worldwide.”
5.5 FORD:While a believer in Six Sigma these days, back in the 1980s, Ford believed in TQM after
its executives saw what the methodology did for Toyota. A new slogan “Quality People,
Quality Products” emerged, especially after Ford partnered with ChemFil, their paint
supplier—a company that helped produce quality paint products customers desired. As
with many other automakers, the emergence of customer surveys was vast and from survey responses came
more quality based on customer needs. Actually, top executives at Ford say TQM was a “light-bulb” idea from
Henry Ford who improved on his assembly line practices to manufacture even more vehicles, while keeping
quality levels high. With their entrance into the Six Sigma methodology, the slogan has changed again at Ford
—“We’ve got a better idea!”
6. DATA ANALYSIS & FINDINGS :
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6.1 COMPARISON BETWEEN TQM SYSTEMS OF GE AND MOTOROLA:GENERAL ELECTRICAL COMPANY MOTOROLA INC.
Amongst the first few companies to implement TQM, by using 6 sigma process.
Amongst the first few companies to implement TQM, by using 6 sigma process.
Professionals are highly trained and are called ‘Black Belts’. Identification of problems and its solution is their full time job in the organization.
Motorola was one of the first companies to win the Malcolm Baldrige National Quality Award (MBNQ) in 1988, due to its very high focus on quality.
The level of defects have been reduced to approx 3.4 parts per million. Due to their consideration of quality as most important factor, it has resulted in the increase of sales and profit of the company.
They have ended up to eliminating most of the defects from products, process and transaction.
GE’s tool kit:o Change Acceleration Process
(CAP)- framework to implement change
o Design for Six Sigma (DFSS)- to ensure that the products are designed for reliability and for process capability.
o LEAN – looks at different processes from the customer’s perspective.
o Six Sigma – Extensive data driven problem solving methodology used for eliminating the defects and variability in the processes.
o Quality Management Systems (QMS)- It ensures quality control and improve the effectiveness of the processes.
o Work Out (WO)- To identify dramatic process improvement opportunities and implement plans for improvement by bringing together the stake holders .
The quality commitments of Motorola are:o Customer Advocacy-
customer feedbacko Quality management system –
quality policyo History of quality- 6 sigma
improvement processes.
6.2 PRESENT AGE TRENDS IN TQM
TREND#1: One of the important concepts of TQM is employee involvement. This is a relatively new method,
which is a contrast to conventional management practices, wherein management takes all decisions and workers
just follow them to accomplish their jobs. This top-down management style is slow and inflexible with little room
for competition. Survival in today’s time-starved, customer driven market requires rapid response times from
manufacturers and other businesses to the ever-changing customer needs. Employee involvement is a system
wherein employees are encouraged to use their expertise and knowledge to suggest methods for improvements in
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their work areas. These suggestions could pertain to improvements in the job, the product, the work atmosphere or
the company as a whole. Many companies have ventured into a participative style of management by involving
employees in the problem solving and decision making processes. For example, when Ford faced continuous
threat of competition from Japanese car manufacturers, it ventured to study how the Japanese were excelling in
their performance efficiency. It established a task force to study the Japanese manufacturing process. Results
showed that the key to Japanese performance and efficiency was their empowered workforce and the teamwork
involved. Employees were given the responsibility and authority to stop a process if the quality failed to meet the
standards specified.
TREND#2: In today's competitive environment every company is looking for ways to enhance the quality of
human capital so as to improve their productivity and ultimately boost the company's bottom line. The aim is to
have the foundation of TQP (Total Quality People) because effective organisations depend on effective people. In
order to improve the productivity and boost the economic conditions of a company, it is imperative that
companies pay attention to the improvement of the quality of human capital as they are the real force behind it
says Gyan Daultani, vice president-HR & RMG, Nihilent Technologies opines.
TREND#3: The Seven New Tools of TQM are said to be: Affinity Diagram (KJ Method) Interrelationship Digraph (ID) Tree Diagram Prioritization Matrix Activity Network Diagram Matrix Diagram Process Decision Program Chart (PDPC)
7. CONCLUSIONS
The shrinking global market has led to stiff competition in the business and industrial arena. The entry of a
number of new companies, both local and global into various markets has given the customer a wide array of
product choices. Many of these new companies are able to produce the same or similar products at almost the
same or lower costs. Thus customers today have a wide range of products to choose from. These products not
only meet their specifications closely, but also their budgets. Competition has extended far beyond the
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manufacturing or private sector. Today, the service, government and non-profit sectors also face stiff
competition.
The need to grow and succeed in an increasingly competitive market has seen the implementation of various
quality initiatives in different organisations. Problem-solving and process improvements are two vital aspects of
the quality initiatives, and proactive actions are being taken to prevent problems. Total Quality Management
(TQM) is a continuous process that strives to increase customer satisfaction, lower costs, and minimise defects
and variations in every aspect and every process of the business.
TQM involves a number of catchwords like Just-In-Time, quality circles, employee involvement, continuous
process improvement, empowerment, Kaizen, self-directed work groups and world-class quality. Basically, the
philosophy of TQM is to involve every employee in the organisation along with its suppliers and distributors to
improve product quality and enhance customer satisfaction.
Co-operation and co-ordination among employees from different departments is very important for
organisations to lay the foundation of TQP in order to progress. The performance attributes of Total Quality
People is to achieve success and have the winning spirit. Organisations must continuously improve, innovate or
re-design their business processes in order to stay ahead in the competition. Researches highlight that a culture
of learning and development foster employee creativity, engagement and result with successful business results.
Without these, none of the improvement activities will be flourished within the company. Organisations must be
transformed and accept people participation and respect on their improvement ideas as indispensable parts of
their corporate culture. For achieving high levels of innovativeness, companies must first convert their culture
into a more participative and respective one.
BIBLIOGRAPHY
1. http://www.ijest.info/docs/IJEST11-03-02-060.pdf
2. http://www.ijest.info/docs/IJEST11-03-02-060.pdf
3. http://mitiq.mit.edu/iciq/pdf/relevance%20of%20total%20quality%20management%20%28tqm%29%20or
%20business%20excellence%20strategy%20implementation%20for%20enterprise%20resource%20planning
%20%28erp%29%20a%20conceptual%20study.pdf13
4. http://www.towers.fr/essays/The%20state%20of%20total%20quality%20management-a%20review.pdf
5. http://www.wiley.com/college/sc/reid/chap5.pdf
6. http://www.stfrancis.edu/content/ba/ghkickul/stuwebs/btopics/works/tqmxerox.htm
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