Quality Management Effects on Organizations’ Performance

Introduction

Total Quality Management is one of the widely used quality management tools in current society. Hill (2008) defines total quality management as “An organization-wide efforts to install and make a permanent climate in which an organization continuously improves its ability to deliver high-quality products and services to customers.”

It is a concerted effort of all members of an organization to improve the process, product, or service that they offer in the market. As (Charantimath (2006) says, it is an effort to deliver superior value to customers as a way of ensuring that they get maximum satisfaction. Total quality management emphasizes on maintaining high quality at all stages of production.

To achieve high-quality products, the raw materials must be of the right quality, the processing of the product must observe the quality standards, and how the product is delivered to the customer should be customer-centric. This continuous quality maintenance process helps in maintaining the customers’ loyalty to the firm.

Total Quality Management is a product of a series of researches and conferences headed by the United States Navy as they tried coming up with a quality management tool. This research was motivated by the fact that Japan was overtaking Europe and North America in the production of high-quality products at cheaper costs during the late 1970s and early 1980s.

The focus of the research was to find a way through which American firms could reduce the cost of their products while improving their quality. It is out of this research that the United States Navy developed this quality management tool and named it Total Quality Management. It has popularly been used in North America, Europe, and Asia.

Thesis statement: Total Quality management has affected organizations’ performance by many activities and concepts such as meeting customer satisfaction, reducing product and services cost, and recognition and celebration.

Concepts of TQM

Total Quality management remains one of the most important quality management tools that many organizations have used to improve their performance in the market. One of the most important factors that make this tool unique is that it insists on continuous quality improvement within an organization. As Hill (2008) observes, to achieve success in maintaining quality in the market, it may be necessary to consider it as a process that is cyclic.

This means that when a firm manages to offer quality products that satisfy the needs of the customers, a new journey shall begin of finding how the quality can be improved further. To achieve this, there are three specific areas that should be given emphasis when a firm is implementing Total Quality Management in its system.

Meeting customer satisfaction

In the current competitive market, firms are struggling to find the best strategies that can help them remain competitive in the market. Customer satisfaction is one of the best ways of achieving this competitiveness. For this reason, many firms have been focused on finding ways of maintaining customer satisfaction in the market. However, Morfaw (2009) warns that satisfying customers in the current market are very challenging.

They have several choices to make whenever they want to make a purchase, and this makes them very demanding. The customers will make the ultimate decision on the products they want. As Morfaw (2009) says, “The customer determines whether the efforts were worthwhile.”

Total Quality Management offers the best solution to this dilemma that many firms find themselves in a while addressing the issue of customer satisfaction. This quality management tool seeks to improve the levels of customer satisfaction by maintaining a continuous quality improvement process.

According to Besterfield (2011), Total Quality Management is customer-centric. Achieving success with this tool means that quality must be maintained at all levels and meeting or exceeding the expectations of the customers. This starts by embracing an outward-in approach to production. A firm must find out what the market needs. With this information, it should align its production and product delivery strategies with market expectations.

When sourcing for the raw materials, the emphasis is always laid on their ability to produce high-quality products. The production process must be done with the needs of the customers in mind. Finally, when delivering the products to the customers, care must always be taken to ensure that the appropriate means are used. Superior sales and marketing procedures must be employed at the final stage of product delivery.

Ford Motors is one of the firms that have used Total Quality Management to improve its ability to meet the customers’ satisfaction. This giant car manufacturer was concerned that the Japanese car manufacturer was able to deliver quality products in the market at a cheaper cost.

In the 1990s, Ford Motors entered into a partnership with ChemFil to find ways of improving the quality of their products using Total Quality Management principles. The firm wanted to produce high-quality products in the market to defend its market share from other upcoming motor companies. This proved very successful for this firm. Although it has embraced modern quality management tools, it still uses principles of Total Quality Management.

Reducing product and services costs

Reduction of a unit cost of the product is another principle of Total Quality Management that made it very popular when it was finally introduced as a quality management tool. According to Morfaw (2009), Total Quality Management seeks to lower costs of production by improving efficiency in the entire process of manufacturing and delivering products to the market.

This means that the final product that will be delivered to the customers will be of high value, but produced at low costs. Lowering the cost of production increases the profit margin of a firm, making it possible to experience growth in the market.

Many organizations are currently using Total Quality Management to lower their costs of the products and services in the market. Besterfield (2011) says, “A fundamental part of TQM is a focus on process thinking.” This tool emphasizes on selecting the best supplier in the market that can offer quality raw materials at competitive prices.

This helps in avoiding cases of purchasing substandard raw materials that may increase the cost of manufacturing the products. Organizations currently prefer suppliers who transport their products to the premises of the company. This helps in the elimination of the cost of transporting the raw materials from the source to the plant.

It is also easier to determine the quality of the products while they are at the facility. Once the quality of the raw materials is ascertained, the principles of Total Quality Management demand that they should take the shortest period possible in the store before they can be used to manufacture the final products. This reduces the cost of warehousing and eliminates the costs of wear and tear if the raw materials are left to stay for long within the firm.

The production should involve the use of modern machines with the capacity to sustain mass production. This will help the firm reduce its production costs by benefiting from economies of scale. The process of delivering the manufactured products to the market should also take the minimum time possible to reduce warehousing, wear, and tear costs on the products.

In the 1980s, Toyota Motors experienced massive success as it gained entry into the European and North American markets that had previously been dominated by Ford Motors and General Motors. This was a big success. However, the firm was experiencing problems with the cost, especially the cost of delivering its products to these two main markets.

The two main competitors incurred minimal costs of transport. It had to find a way of reducing the cost of production. The solution was found in Total Quality Management. By reducing the overall cost of producing a unit product, it was possible for this firm to deliver its high-quality products to the market at reduced costs, making it easy for the firm to compete with other market rivals.

Employees’ recognition

Employees form a very important part of an organization that determines its level of success in the market. According to Besterfield (2011), the success of a firm is always based on how well it can maintain a team of highly motivated employees who are skilled enough to address various issues in their workplace environment. Total Quality Management emphasizes the need to have highly motivated and skilled employees.

Principles of Total Quality Management focus on using employees to maintain a continuous quality improvement process. However, this can only take place if they have the right training and are motivated. This quality management tool insists on creating an enabling environment for the employees.

Every employee must be assigned a task he or she has enough knowledge and capacity to address. The remuneration of the employees should also be within the market range. Above all, employees should be respected and involved in the management decisions to ensure that they remain motivated.

Xerox Corporation is one of the firms that have used Total Quality Management to specifically improve their employees’ recognition. The firm is operating in a very competitive industry, and its leadership has been consistent over the years in maintaining a group of highly motivated employees.

The firm organizes regular in-house training and seminars to improve the quality of its products. Maintaining the employees’ level of satisfaction has helped the firm to become successful as it works with a team of motivated employees.

Conclusion

It is clear from the discussion above that Total Quality Management is one of the popularly used quality management tools. Developed in the early 1980s by the United States Navy, this tool became very popular in Europe, North America, and Asia among companies that were struggling to cut their costs of production and improve the quality of their products.

The importance of Total Quality Management has been drawn clearly in the three companies analyzed above. This tool helps in promoting customer satisfaction, reduction of cost of production, and maintaining high levels of employees’ motivation.

References

Besterfield, Dale H. (2011). Total quality management. Delhi: Dorking Kindersley.

Charantimath, P. M. (2006). Total quality management. New Delhi: Pearson Education.

Hill, D. A. (2008). What makes total quality management work: A study of obstacles and outcomes

Morfaw, J. N. (2009). Total quality management (TQM): A model for the sustainability of projects and programs in Africa. Lanham [Md.: University Press of America.