Cost Leadership Strategy

A Journey Towards an Excellent Organization by Deploying Total Quality Management (TQM) Programs

Interest in quality issues has been on the rise as many organizations come to realize that providing better quality leads to various benefits such as lower costs. reduction in appraisals and failure costs, and ultimately point to a higher market share. Within the past decade, the process of achieving quality improvements has become a priority for many organizations. Recent evidence also sugggests that more and more corporations and organizations tend to recognize the importance and necessity of quality improvements if they are to survive in today’s domestics and worldwide competition.

These quality improvements programs have come with many names and identities, such as continuous measurable improvement, leadership through quality, total quality control and Total Quality Management (TQM).

The concept of  Total Quality Management is simple and its principles are the means to manage an organization. Many writers decribe these principles as the application of common sense to organizational activities, so as to ensure that they satisfy and conform to customer’s  needs and requirements.

Total Quality Management is defined as both a philosophy and a set of guiding principles that represent the foundation of a continuously improving organization. It is the application of quantitative methods and human resources to improve all the processes within an organization and exceed customer’s  needs now and in the future. TQM integrates fundamental management techniques, existing improvement efforts and technical tools under a disciplined approach.

Why TQM? Studies establish the link between quality and profitability. Many reports and surveys also show that performance, as measured by profit margin and return on investment is improved for firms that adopted TQM. Firms with more advanced Total Quality Management systems demonstrated stronger and more consistent improvement.

There is a general agreement among TQM experts that properly implemented quality systems do improve organizational performance. Fewer defects, reduced rework and scrap, reduced inventory levels, reduced lead times, incrreased flexibility, and increased employee satisfaction are among the benefits that reportedly come from a successful total quality management progam.

Overall, the results appear to provide evidence that quality practices can have a beneficial effect on productivity and profits. However, they also appear to demonstrate that some practices are more effective than others in certain circumstances. In other words, a ‘cookie cutter” approcah to TQM will not work in every organization.

Basically, TQM requires four or five basic foundation, such as :

1. A committed and involved management to provide long term top to bottom organizational support.
2. An unwavering focused on the customer, both internally and externmally.
3. Effective utilization of the entire worr force (workers  involvement).
4. Continuous quality improvement of the business and production process.
5. Performance measure for the process (management by fact).

In general, we can say Total Quality Management incorporates the design of products that meet customer’s needs, control of processes to ensure their ability to meet design requirements, and quality improvement for continued enhancement of quality.