Total Quality Management
Total Quality Management(TQM) is an organisational process that actively involves every
function and every employee in satisfying customers needs, both internal and external.
TQM works by continuously improving all aspect of work through structured control,
improvement and planning activities that are carried out in concern with guiding ideology
that focuses on Quality and Customer Satisfaction as the top priorities.
There has been many arguments that TQM succeeds only by incorporating a concern about
quality for the customers throughout the organisation. The truth of this statement and
those facts that disagree with this statement will be look into and discuss in more
detail to achieve the success of TQM.
TQM recognises that the Customer is at the center of every activity. The customer may be
external or internal. The key is to determine the gap between what the customer needs and
what the system delivers. Once the gap is recognised, it would be systematically reduced
and results in never-ending improvement in customer satisfaction at every level.
TQM depends on and creates a culture in an organisation which involves everybody in
quality improvement. Everyone in the company can affect quality but must first realise
this factor and have the techniques and tools which are appropriate for improving
quality. Thus TQM includes the marketing and dissemination of quality and methods not
only within the organisation and customers but also to suppliers and other partners.
The general view to achieve success in TQM could be summarised as below:
? Quality as strength
? Quality in all processes
? The importance of management
? The involvement, commitment and responsibility of everybody
? Continuous improvement
? Zero defects
? Focus on prevention rather than inspection
? Meeting the needs of target customers
? Recovery
? Benchmarking
A prerequisite for successful quality improvement is first, to understand how quality is
perceived and valued by customers.
4 'Q'
Design Quality Technical Quality
Production Quality
Delivery Quality Functional Quality
Relational Quality
Image
Experiences
Expectation
Customer Perceived Quality
=
Customer Satisfaction
Figure 1: Gronroos - Gummesson Quality Model (1987)
Gronroos and Gummesson has combined their 'Customer Perceived Quality' model and the 4
"Q" model to stress the importance of customer. The intergrated model focuses solely for
the organisation to achieve customer satisfaction through improving the quality for the
customers.
Morup (1992) notes that "quality is the most important and effective factor a company can
use in the battle for customers." To be competitive, we must satisfy the customers. In
order to be more competitive, we must delight the customers. Quality is here defined as
the measure of customer delightment.
Kaizen provides the philosophy and driving force for designing the quality. If quality is
made the global driving force, then customers will obtain the best value possible and use
the product. The concern about quality will optimise the value for customers.
The TQM perspective involves not only quality in relations with external customers but
also quality in the internal service chains and in relation to suppliers and other
partners.
This "Quality Chain" involves everyone in the process and applied throughout the
organisation.
Customer orientation and quality are not just a matter of ensuring that the contents of
the product or services satisfies the customer needs. The manner in which the service is
delivered and the customers' relations with the company must also meet the customer's
expectation.
?
Sales
Customer Satisfaction
Quality Improvement
As the above graph indicates the sales increases directly with an increase in customer
satisfaction. Customers are satisfied with improvement in quality. The more quality
improves, the faster sales will increase because customer satisfaction carries its own
acceleration. When the quality reputation grows, marketing can emphasize increasing
customer satisfaction as a major element in advertising and the other promotions.
As Deming wrote in his book "Out of the Crisis," it will not suffice to have customers
that are merely satisfied. An unhappy customer will switch. Unfortunately a satisfied
customer may also switch, on the theory that he could not lose much and might gain.
Profit in business comes from repeat customers, customers that can boast about your
product and service, and that bring friends with them. He further stated that we should
stay ahead of the customers. This could be achieved through constant quality improvement
and innovations.
Why Do Companies Lose Customers:
Death of Customer 1%
Customer Moving Residence 3%
Lower Price Elsewhere 5%
Unsatisfactory Handling of Complaints 14%
Suppliers' Lack of Interest 68%
As shown in the above graph above TQM's success includes the incorporation on quality of
the after sales service and follow up. The quality needed in maintaining a customer will
be less as compare to gaining a new customer. TQM success would therefore not only focus
on gaining new customers but maintaining the current customers, through improvement in
quality for customers.
Eventhough the main concern about TQM is highly focused on the customers, the focus on
internal process cannot be left out. TQM's success may not lie only on the quality for
the customer but the quality of the organisation as a whole. The core concept is
discussed below:
Right First Time / Zero Defects
TQM stress of the importance of zero defects and achieving the right target the first
and everytime. Variances in product are not acceptable and methods such as the
Statistical Process Control (SPC) is use to achieve the objective. Zero defects is the
result of an emphasis on prevention and diligent use of measurement, process control and
the data driven elimination of waste and error. As Crosby said, "The purpose of quality
management is to set up a system and a management discipline that prevents defects from
happening in the company's performance cycle."
Cost of Quality
This is the cost incurred in achieving a quality product or services. These may be
prevention cost, appraisal cost, internal failure cost, external failure cost, the cost
of exceeding customer's requirement and the cost of lost opportunities.
Competitive Benchmarking
Comparing with competitors is another reflex of TQM. This is a continuous management
process that helps firms access their competition and themselves and to use that
knowledge in designing a practical plan to achieve market superiority. When done
correctly, benchmarking produces the hard facts needed to plan and execute effective
business strategies.
Involvement of Everyone
In TQM everyone is involved in the process of making the company a successful business.
Everyone in the company is responsible for producing quality goods and services and
reducing the cost of quality.
Synergy in Team Work
In Japan, there is no status difference as they believe in synergy. Therefore they
consider themselves as partners depending on each other for effective management and
success.
Ownership and the Elements of Self-Management
Total quality programmes are founded on the principal that people want to own the
problems, the process, the solution and ultimately the success associated with the
quality improvement. Psychologically, the ownership advocated by TQM ties in the
development in organisational design away from traditional models of imposing management
control over employees' behaviour.
Recognition and Rewards
TQM system considers the rewards and recognition to be critical to a company's programme,
particularly when greater involvement of staff is required. Positive reinforcement
through recognition and rewards is essential to maintain achievement and continuous
improvement through participative problem-solving projects.
The Quality Delivery Process
TQM is not just the awareness of quality for the customers. It demands the implementation
of a new system.
Finally, the main objective of TQM may put the customer at the center of every activity
and consider the process as customer driven, but all other factors which do not involve
the customers have to be taken into consideration for the successful implementation of
TQM.
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