Definition of Total Quality Management (TQM)
Total Quality Management (TQM) is defined by International Organization for Standardization (ISO):
“TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organization and to society.”
In Japanese, Total Quality Management (TQM) comprises four process steps, namely:
- Kaizen — Focuses on Continuous Process Improvement, to make processes visible, repeatable and measurable.
- Atarimae Hinshitsu — The idea that things will work as they are supposed to (e.g. a pen will write.).
- KanseiKansei — Examining the way the user applies the product leads to improvement in the product itself.
- Miryokuteki Hinshitsu — The idea that things should have an aesthetic quality which is different from “atarimae hinshitsu” (e.g. a pen will write in a way that is pleasing to the writer.)
Total Quality Management (TQM) requires that the company maintain this quality standard in all aspects of its business. This requires ensuring that things are done right the first time and that defects and waste are eliminated from operations.
Total Quality Management (TQM) Summary
Total Quality Management (TQM) approach can be summarized below under three headings: responsibility for quality, product design, and relation with suppliers.
- Responsibility for quality: The traditional view was that quality problems start on the factory floor, that workers were primarily responsible for poor quality, and that the best way to control quality, therefore, was to “inspect quality into the final product”. This required a large quality control department. The total quality control view is that responsibility for quality should be shared by everyone in the organization; in fact most of the problems arise before the product reaches the factory floor. Under TQM, the philosophy is to “build quality into the product” rather than “inspect quality of the product”. Errors in design, raw material procurement, and so on should be detected at the source. Workers should be held responsible for their own work and should not pass a defective unit on to the next work station; thus, the workers are their own inspectors. Instead of inspecting product quality at the end of production, the quality control staff should monitor the production process and enable workers to “make the product right the first time”.
- Product design: studies have shown that many quality problems originate with the design or the product. Some designers pay inadequate attention to the “manufacturability” of the product. Others include pars that are unique to the product, whereas pars that are common to several products would be satisfactory and are available at lower cost; or they design more separate parts than are necessary, which gives inadequate recognition to the cost involved in setting up machines for each part. Under Total Quality Control, there has been an effort to have the designers work closely with production engineers who are familiar with the manufacturing problems. Designing for manufacturability is one aspect of design. The other aspect of design is designing for marketability, that is, the quality of a product should be what the customer wants, not more. Thus there should be close cooperation between designers and marketing people.
- Relation with suppliers: TQM involves a change in the traditional relationship with suppliers. Instead of awarding contracts to several suppliers, based primarily on which one bid the lowest price, there are only one or two suppliers for a given item; they are selected on the basis of quality and on-time delivery as well as on, price. Long term relationships are established with them.
Different Elements of TQM
Within the frame of Total Quality Management, there are a considerable amount of elements that work together to achieve customer satisfaction. The elements encourage those that use it to adopt a common sense approach to management. If each element does not work hand in hand with each other, it is likely that the company’s efforts to attain quality will reduce to failure.
The first element, Ethics, addresses the individual’s understanding on the good or bad at the workplace and the professional code of conduct in place that needs to be adhered to in order to maintain and improve work performance. The second element, Integrity, looks at the honesty and openness of individuals and the organisation as a whole. Every business endeavour relating to the company is expected to be honest and fair; and in line with the organisation’s policies. The third element, Trust, is widely regarded as one of the most important principles needed for TQM to work. Trust works hand in hand with Integrity and Ethics. Employees need to be able to trust each other; as it not only improves working relationships but allows workers to be entrusted with making decisions and take risks in the aid of continuous improvement. The fourth element, Training, is imperative when implementing TQM. Employees need to be trained appropriately in the workplace in order to attain optimum productivity levels as well as provide excellent customer service. The fifth element, Teamwork, looks at the involvement of staff in the organisation. It is important for employees to work in teams rather than working individually because companies will be able to utilise every individual’s talent and find the best possible solutions needed to solve potential problems that may arise. The sixth element, Leadership, is arguably the most important element of TQM. Leadership requires managers to have a clear direction that they see the company going over a period of time in terms of strategies & goals and are able to instil it into their employees. The seventh element, Communication, brings all of the other elements together. It is the vital cog in the implementation of TQM. The success of TQM requires effective communication between all parties involved with the organisation. The eighth and final element, Recognition, is arguably the most fulfilling part of TQM. Individuals within the company should be recognised for their achievements and efforts as quickly as possible. In doing so, employees’ self-esteem will increase sufficiently and motivate them to increase productivity. Recognition could come in the form of appreciation letters, awards etc.
TQM is widely visualised as a house. A house has the roof with the foundation and bricks held together by mortar. The first three elements (ethics, integrity and trust) represent the strong foundation needed to build on TQM. The next three elements (training, teamwork and leadership) are seen as the bricks that are used to build on the foundations for TQM whilst the roof (recognition) provides cover for the whole of TQM during implementation. The final element (communication) is the strong mortar that puts the whole structure of TQM together.
Why is TQM Important
Total quality management is undoubtedly important in organisations today. It is paramount for companies to achieve customer satisfaction. Therefore, there has to be a strong focus on exceeding the expectations of its internal customers before they decide to address what is needed to satisfy external customers. The information gathered from these customers will therefore provide a guideline that will help the organisation to make adjustments accordingly. TQM, particularly in manufacturing companies, guarantees quality in products. Having TQM in place when building a product can help a company to make a product that does exactly as it states. TQM can be influential in helping companies to reduce its costs; increasing their competitive advantage over their respective rivals. For example, supermarkets have forged close partnerships with their suppliers where they buy popular goods in bulk at discount prices. As a result, they can offer products at prices that are low enough to price their competitors out of the market.
Also, in the case of manufacturing companies, the reduction of waste levels can be achieved through TQM. By improving their processes, companies will be able to make products with minimal waste costs and still attain good profit margins. Likewise, having a TQM system in place when dealing with suppliers will help organisations to manage their stock effectively by using a Just-In-Time (JIT) philosophy; made famous by Wal-Mart. Using the JIT system will not only reduce inventory costs but build strong communication between the organisation and their supplier. TQM facilitates teamwork within the organisation. Every department within the company is linked together and therefore need to work together to make quality products. Having TQM can help to build a solid reputation in their respective market/industry. Being known as a respectable organisation within their sector will cause customers to gravitate towards them and use their products and services.
TQM Implementation at Toyota
During the late 1960s, Toyota, originally a Japanese truck manufacturer, decided to try their hand in making cars. However, they looked at the different stages of the manufacturing process for their cars and were always trying to improve them. This culminated in worldwide success in the 1980s and was regarded as the highest quality automobile producers in the world. The reason for this was that they looked into the causes of why products may not live up to its billing; and they realized that the machines being used to make these products had significant wear and tear. Likewise, this caused the machine to have defective parts and resulted in a lack of productivity on Toyota’s part while they were waiting for the machine to be sorted out. Also, workers within Toyota were unsure about their role at times; as they were often confused about which machine they were assigned to.
Therefore, to tackle these issues, Toyota analysed every facet of the way it operates. They trained their workers to keep a note of the machine that they used, how it operated, its repair history and the mechanisms behind the effective working of the machine. Such requirements forced workers to study their machines thoroughly and gain mechanical knowledge rather than leave everything to the engineers. Toyota’s next step in tackling their issues was to look at more efficient ways to not only maintain their machines but keep the working environment clean; as their factories were reminiscent to American factories. As a result, they created a cleaning programme that started from normal cleaning of the work areas; to taking apart the machines to clean them and then finally making covers on the machines to prevent shrapnel and dust getting into the machines permanently. By having such an effective and detailed system in place, Toyota extinguished the threat of machine breakdown and limited the need for engineers to fix the machines. With the workers having expert knowledge on the machines that they use, they are able to repair and improve their parts. The system has enabled Toyota to become the largest and most profitable car manufacturer in the world as well as stand out as the highest quality cars available from the 1980s. This system used by Toyota is reminiscent of the TQM technique known as 5S; where workers are driven to eliminate waste and keep their machines in order simultaneously using 5 steps: seiri (sorting), seiton (set in order), seiso (shine), seiketsu (standardise) and shitsuke (sustain).
All of Toyota’s workers are trained to focus on the philosophy of continuous improvement, popularly known as Kaizen; where the company are always looking to improve its processes and therefore optimise its performance. They are bedded into a culture that makes you believe that quality can never be attained because there is always room to move to the next level. Their efforts to provide the highest quality through their particular system has been dubbed “The Toyota Way”. This system emphasises that by having a long-term philosophy, you must also have the right procedures in place. In doing so, you will yield the right results and therefore add value to the organisation through the development of its people.