Concept TQM

Today’s global market is highly competitive and the competition is getting tougher. This is forcing companies to provide more consistent and better quality products and services to their customers. To provide such quality products and services which meet or exceed customer expectations, a key management approach such as Total Quality Management (TQM) should be implemented. Here, Total means involvement or input of everyone concerned with the organization including management, employees, customers and suppliers. Quality means meeting customer needs fully and all the time. Management is the way by which all the policies and procedures are operated. Thus, TQM can be defined as the art of managing the whole to achieve excellence to satisfy customer expectation.

Key Definitions

Denied By	Definition
Robbins and Coulter	“Total quality management is a philosophy of management that is driven by customer needs and expectations and focus on continual improvement in work process”
Ricky W. Griffin	“A strategic commitment by top management to change its whole approach to business to make quality a guiding factor in everything it does”
Robert Kreitner	“Total quality management is defined as creating an organizational culture committed to the continuous improvement of skills, teamwork, processes, product and service quality and customer satisfaction”

TQM In Brief

What TQM Includes? (Elements)	How was TQM Developed? (Evolution)
Top management commitment and support Customer focus Employee involvement and focus Leadership and strategic planning Company-wide quality culture Continuous improvement Customer satisfaction and delight	Detection and rectification of defects Prevention of defects (Process Control)  Product design improvement Creativity and innovation through Quality Circles

Total quality management is the set of systematic activities of an organization directed towards meeting customer’s expected quality of products or services. TQM is a management approach in which all the effort from everyone in the organization is aimed at enhancing the quality of products and services for customer satisfaction. In other words, TQM is a management philosophy that seeks to integrate all management functions including finance, customer service, engineering, marketing and so on to focus on customer needs and organizational objectives. In a nutshell, total quality management is an approach integrating all the organizational resources for improving the quality of products and services with the objective of meeting customer needs.

Principles of TQM

TQM is a integrated management done with the priority of meeting customer expectation with involvement of everyone in the organization. It is an approach guided towards improving quality of all organizational inputs to comply the exact expected need of the customers.  This approach is based on certain principles. Here are 8 principles of total quality management:

1. Customer Focus: Customer is at the center of TQM whereby companies understand customer needs and aim to meet or exceed their expectation.
2. Leadership: Unity of purpose and organizational direction is established where all the members of the organization share common goals ie. Customer satisfaction
3. Involvement and Utilization of Workforce: A favorable and no fear environment is created where all the employees are motivated to be involved and work to achieve the organizational goal.
4. Process Approach: TQM recognizes things accomplished are due to improvement and betterment of processes.
5. Strategic and Systematic Approach to Management: The strategic plan of a company must incorporate quality as the key core component.
6. Continuous Improvement: It is promoting continuous improvement culture unless zero defects, zero error and zero accidents are achieved.
7. Factual Decision Making: All decisions are made on actual reliable data, facts and figures as no subjective decision-making are done.
8. Mutually Beneficial Supplier Relationship: The supplier relationship should benefit not just the company but the supplier also.

Objectives of TQM

Total quality management is a management approach integrating organizational resources for quality enhancement for customer’s well-being. TQM has been developed to meet different objectives. These objectives are mentioned as under:

1. Meeting Customer Need: Customer is the core focus of total quality management. TQM understands the value and influence of customers for a business. A satisfied customer becomes loyal. After being loyal, the customer gives an excellent word of mouth to potential customers. With this, potential customers can easily convert into actual customers and the process goes on. Hence, total quality management aims in meeting customer requirements equal to or above the customer expectation level. This can be done only through the quality enhancement of products and services.
2. Continuous Improvement: Total quality management aims for continuous improvement of products and services. For this, continuous improvement in the production process, distribution networks, employee skills, machinery upgrades and so on are done. Continuous improvement aims for zero defects, zero errors and zero accidents during the production and delivery of products and services.
3. Develop the Relationship of Openness and Trust with Employees: TQM is possible only when there is great employee involvement. There should be a transparent and open relationship among employees. This ensures trust among them. Hence, TQM aims for developing open and trustworthy relationships among all employees.
4. Effective Integration of Resources: The quality of products and services can only be enhanced if all the resources are integrated effectively. Hence, the objective of TQM is to integrate all resources ineffective way to achieve the goal of quality enhancement.
5. Increase Customer Base: A well-satisfied customer brings numerous customers. A customer comes, gets satisfied and brings more. This process repeats time and again. This increases the customer base. Hence, understanding this TQM aims for need satisfaction of all arriving customers qualitatively.
6. Tackle Competition: Another objective of total quality management is to take the throat-cutting market competition. This can be possible only if the products or services delivered have differentiating attributes than that of competitors’. TQM understands this and hence focuses on quality improvement that is more valuable than competing products or services.
7. Other Objectives: TQM has other objectives such as keeping employees motivated, improve supplier relationships, continuous updates of the technology, zero customer complaints etc.

Steps in Implementing TQM

Depending upon the nature and need of any business, total quality management can be designed, developed and implemented. However, such process of total quality management follows the following steps for implementation:

Step 1: Plan

This is the first step towards implementing total quality management. In this step, employees come up with their problems and challenges. These problems are analyzed and the root cause is identified. Employers research on the basis of obtained data and make some findings. Such findings will help them to solve the identified problems.

Step 2: Do

This is the stage of doing what was planned. In this step, solutions to the problems identified in step 1 are obtained. Strategies are developed to overcome challenges and solve problems. The effectiveness of strategies to solve problems is also determined in this step.

Step 3: Check

After doing comes the phase of checking what was done. In this step, people do comparison analysis from before and after data. This is done to confirm the effectiveness of processes and measure the results.

Step 4: Act

In this step, the results are documented. These documented results are used to solve other problems. With this step, the initiation for total quality management is done.

Tools for TQM

Total quality is improving and maintaining the quality of products and services to meet customer needs. This is a holistic process of involving everyone in the organization towards continuous quality improvement. Such total quality management is facilitated by different tools. These tools are discussed below:

1. Benchmarking: Benchmarking is the process of marking a competitor’s excellence. It is searching best strategies, policies and practices of competitors which make their performance better. It is comparing the product and process of an organization with its competitors to evaluate its strengths and weaknesses. Benchmarking is the way of knowing where an organization stands among the best-performing firms in the industry. It is identifying the reasons behind the excellent product and process performance of competitors. It helps in learning the best practices of others and applying them to product, process and productivity. Briefly, benchmarking is understanding and analyzing the best business practices of others, compare own business performance with others and initiating necessary steps to close the performance gap.
2. Outsourcing: A single organization cannot be an expert in all aspects of production. This situation can be tackled by providing sub-contract of some part of work to other organizations who are excellent in that work. This process of subcontracting some part of work to other organizations to bring the benefit of their specialization is called outsourcing. Outsourcing brings quality and reduces the inferiority of products. It is a means of reducing costs and improving efficiency. Due to this, an organization should identify areas that can be outsourced so as improve quality with efficiency and reduced cost.
3. ISO 9000: International Organization for Standardization (ISO) was established on February 23, 1947. It looks after quality and standards related to products, processes and services throughout the world. It produces worldwide international and commercial standards. There are five sets of standards covering areas including product testing, employee training, record keeping, supplier relations and repair policies and procedures ranging from 9000 to 9004. These standards are accepted and adopted by all its member countries. In Nepal, the Nepal Bureau of Standards and Metrology adopts and facilitates ISO standards. Such ISO standards are highly recognized and valued globally. Hence, such standards act as a guide and set the framework of TQM accordingly by a business organization.
4. Statistical Quality Control (SQC): This is a set of statistical techniques which is applied for monitoring the quality of produced goods or services. It checks conformance of quality maintained as per specification through the use of statistical or probability tools. Under it, techniques like product sampling, process sampling and control charts can be used. In product sampling, a sample product is chosen to check the validity of its attributes as per specified standards. Process sampling checks for defective production and evaluates the standard of the process of production. Similarly, a control chart is used to control different variables within a range.
5. Employee Empowerment: TQM uses employee empowerment as a key tool. Employees are provided adequate authority, responsibility and autonomy to work in a participative way. There is a proper level of delegation of decision-making authority. Employees at their level can take necessary decisions. Different groups and quality circles are created that have a high focus on quality and can work autonomously. With the application of such approaches, employees are empowered and motivated. Motivated employees are satisfied with the organization and their quality of performance, productivity and efficiency increases. This fosters the implementation of TQM and ensures its success.
6. Just In Time (JIT) Inventory System: This is a system of maintaining zero levels of raw materials, work in progress and finished goods by a business. It aims for better supplier relationships and reduction of investment in inventories. It is an approach of availing inventories just at the time when needed. With the JIT system, inventory wastage can be reduced and fresh inventories can be availed at the time of production. This means better quality materials are received which makes the production process efficient and smooth. This system believes money saved from not investing in inventories can be used for quality improvement activities. 
7. Re-engineering: Re-engineering is also used for total quality management. This means going for a change in product design and production process. Depending upon the changed need of customers and competitors, such changes are initiated in the product or production process. Re-engineering can be done through a change in size, specification, packaging, design modification, improvement in the function of products, technological changes in the production process, machine overhauling etc. All such re-engineering works are done so as continuously improve the quality of goods and services to meet customer needs.

Limitations of TQM

Total quality management is a holistic approach for continuous quality improvement and customer satisfaction. It is a distinct and highly advantageous method for an organization as it improves multiple aspects of an organization. Despite so many advantages and implications, TQM is not free from limitations. Some limitations of total quality management are mentioned below:

1. Takes a Long Time: Total quality management cannot be implemented overnight. It is implemented through changes in product design, production process, modification of machines, procurement changes, strategic re-design etc. over a comprehensive integrated process. This takes a very long time.
2. Incurs Heavy Cost: TQM is a costly method to implement. It requires lots of change in existing organizational dimensions and the addition of new dimensions. This could be in the form of structural changes, operational changes, machinery upgrades, purchase of new machines and technologies, hiring new technical or managerial manpower, training existing employees etc. This requires heavy long-term and short-term investments. Hence, TQM is very cost-incurring and not suitable for those organizations with high financial sources or backups.
3. Resistance to Change: TQM demands little or extended changes in all aspects of an organization. This includes changes in structure, operation, processes and systems. But such a huge level of change is not preferred by some or most people in the organization. Hence, people will show their resistance to change either individually or through unions.
4. Not Possible Without High Management Commitment: First and foremost, the implementation of TQM depends upon the level of interest, intensity and commitment of management. It can be implemented if management has a strong commitment to quality improvement and customer satisfaction. In case of any form of latency or inability in deciding at in right time with the right logic by the management, TQM cannot be implemented and it will be a failed endeavor.