INTRODUCTION
Total quality management (TQM) has its origins in Japan after the First World War due to the need of quality products. This report describes quality and total quality management and how this TQM concept originated and became need of the hour. It further describes one step at a time approach to obtain desired quality which includes the PDCA cycle. Finally, the report discusses the issues at Standard Radiators, a Bhopal based company, and what quality measures its management took to gain success.
TQM
Total Quality Management (TQM) has developed from the methods of quality assurance which were developed for the first time during World War One. The war resulted in mass manufacturing efforts which often resulted in poor quality. To rectify the problem quality inspectors had to be stationed at the production line. This soon became the norm after WW-I and resulted in a theory, SQC (Statistical Quality Control), of Dr. W. Edwards Deming. By mid-1950 quality control became a fundamental part and was implemented by workers of all levels in Japanese manufacturing organizations (Murray, 2012). In 1970’s the total quality concept had started to emerge. It was a quality control which involved all the employees from workers up to. Soon this new wave of quality management measures were being adopted by non-Japanese firms and the concept was called TQM (Total Quality Management).
There are two views of quality. First, the customer’s view based on quality, design, features, performance and value i.e. quality/Price. Second, is the producer’s view which depends on conformance to requirements (for example: number of defects per million products), quality costs, prevention costs (e.g. training), appraisal costs, rework costs and warranty costs. Increase in quality conformance decreases costs and increases profits (Hammett, 2012).
According to Oakland (1989) TQM should be adopted by most of the organizations. Milakovich (1990); Morgan & Murgatroyd (1997) define TQM as an overall organizational approach to meet customer requirements and expectations involving each and every manager and employee for using quantitative techniques to continuously improve the firm’s processes, services & products. An organization is not just a technical system, but also a human system (Pike and Barnes, 1996). TQM tries to improvise the entire firm’s competitive nature, effectiveness, and its structure.
Management methods, tools, & systems are very important in TQM and form its “hard” side. Management tools can be defined as the means of collection and display of information in such a way that human brain can grasp thoughts or ideas that provide better results when used in physical processes (Goetsch and Davis, 1994). Nine main principles comprise the soft side of TQM. The 1st principle of TQM states that everyone in a firm is involved. Powell (1995) suggests that it is commonly known that more the employees participates in the complete quality strategy it will result in an increase in the information & knowledge flow, and contribute in “intelligence distribution” to the lowest level of a firm for solving problems. The “total” component of TQM denotes that every member of an organization is involved (Morgan and Murgatroyd, 1997). TQM is basically a method to organize and involve the entire organization; each department, each activity and each and every person at the every level (Oakland, 1989).
The 2nd principle is related to continuous improvement. Dale (1996); Goetsch & Davis (1994); Ho & Fung (1994) are of the view that under TQM theory best method for improvising organization’s output is by continually improving the performance. Quality improvement can be considered a continuous action with no end. For maintaining a continued effort quality improvement, it is essential to develop a generation of top managers who pursue never-ending improvisation to meet external & internal customer’s requirements in a dedicated manner (Oakland, 1989) Longenecker & Scazzero (1996 warn that in order to achieve few quality improvements may lead to complacency.
According to Conti & Kleiner (1997); Hill (1991); Lawler (1994); Waldman (1994); Wilkinson, Marchington, Goodman, & Ackers (1992) the 3rd TQM principle relates to teamwork concept. Coyle-Shapiro (1997) suggests that under TQM teamwork is considered an essential outcome for implementing continuous improvement. Teams are mostly considered more powerful & more effective work bodies than individuals.
Employee empowerment is the 4th important TQM principle. TQM offers methods in which employee empowerment could help an organization not only to improve quality but also in empowerment (Wilkinson, 1998). Management seeks commitment & empowerment of its employees whereas the basis of TQM is greater control on the work processes (Cleary, 1996).
The 5th TQM concept is continuous training. Training is the only vital component to enhance quality (Oakland, 1989). He further says that the quality training should be continuous so that it meets technological and environmental changes. Furthermore, Brown (1994); Marchington, Dale, & Wilkinson (1993); Patel (1993); Walley & Kowalski (1992) are of the view that effective implementation of TQM requires a policy for training which should be integrated with complete quality aiming to improve the required abilities for continuous improvement in quality. In future training on quality issues must stress on a better training assessment processes (Motwani, Frahm, & Kathawala, 1994). They also agree to the fact that specific indicators such as market share, customer satisfaction and employee performance can help evaluate training.
Customer satisfaction is the 6th element of TQM. Moore, Hopkins, & Hopkins (1998); Zairi (2000) opine that customer satisfaction should be the driving force in a firm for improving its performance. Customers can be of two kinds: external (i.e. clients, public, government regulatory organizations,) who define the qualities pertaining to the service given and internal (i.e. employees, various departments) which define the processes quality related to service delivery (Juran, 1993). There are certain needs of both external & internal customers. Even though consumer focus is valued there is a need to develop methods to understand a consumer’s situation more deeply (Lagrosen, 2001).
The above TQM principles require the 7th TQM element i.e. support and commitment of top management. Top managers need to personally take charge, provide leadership, direction and if need be use forceful leadership when some employee blocks improvement (Dale, 1999).Senior managers have to define the organization’s objectives of quality to give direction & clarity and these should be continually communicated within the firm (Torrington and. Hall, 1998). Organisations with a quality top management is more committed to greater quality products compared to organisations with a lower support from the top management (Ahire and O’Shaughnessy, 1998). Other than management’s commitment & support an open & democratic (participative) management style is necessary and is the 8th TQM element. Crosby (1979) has stressed the relevance of the style of management in TQM. The main difference in TQM and various other approaches to management is the more democratic nature of TQM (Morgan and Murgatroyd, 1997).
Lastly as argued by Atkinson (1990); Coulson-Thomas (1992); Grant, Shani, & Krishnan (1994); Sousa-Poza, Nystrom, & Wiebe (2001); Van Donk & Sanders (1993) an organizational culture which is supportive is the 9th required element of the ‘soft’ aspects of TQM and is a common denominator for all other elements. Organizational culture has an affect and can alter employee’s action & perception of all work related aspects to embrace quality (Corbett and Rastrick, 2000; Sinclair and Collins, 1994).
First step to implement good manufacturing practices is to adopt the PDCA (i.e. Plan, Do, Check, Action) cycle. PDCA helps to improve, whenever Gap Analysis is done. It helps to develop counter measures which prevent recurrence of a problem, by identifying and removing its root cause. This gap analysis is PDCA cycle’s most crucial step.
ONE STEP AT A TIME QUALITY
Gunasekaran (2001); Harrington (1996); Miller (1992) argue that benchmarking is among the popular ways to maximize quality. Benchmarking was popularized in early 1980s by Xerox. Mittelstadt (1992) says that it is a continuous process to measure a firm with the best in the world so that goals can be made on the basis of the benchmark firm’s business methodologies. The above notion has been challenged by Ernst and Young (Port and Smith 1992). According to Ernst and Young’s survey in US firms previously performing well reaped the benefits of benchmarking compared to those whose performance was medium to low as they showed no noteworthy benefits. The problem that emerged was the difference in a firm and the benchmarked firm. As Reger et al. (1994); Locke and Latham (1990); Snyder (1994) aptly say that if the benchmarked goals seemed impossible to achieve it resulted in discouragement.
Mann, Samson, and Dow (1998) supported the above view and conducted a study that established that small-wins approach (Weick, 1984) in which firms implemented a sequence of short-term doable assignments which led to increase in sales performance compared to a long term approach. Huff, Huff and Thomas (1992) aptly say that the difference in current situation compared to benchmark must be big enough to generate desire to improve but, Forward and Zander (1971); Osgood and Tannenbaum (1955) argue that the difference should not be such that the attainment of goal seems impossible. Cavanaugh (1982) adds that the average employee might not comply to the new standards or benchmark and may seek to desire more attainable goals.
Watson and Tharp (2002) argue that reaching goals with small steps forms the foundation of shaping, a method to of reaching the main goal step by step. However, shaping may not be the best solution for each firm as it takes a considerable amount of time and requires advance planning. Daniels (1989) is of the view that the progress will be faster if the improvements reinforced are small. Making sub goals was not the only unique feature in shaping but it also includes consistent rewards when attaining each sub goal. For example in a situation of quality improvement where people having a performance of 70% efficiency are set a new goal at 90% the shaping process needs to be followed if the goal is not being reached. Sub goals of 75%,80%, 85% might be necessary which are more easily attainable.
Successful usage of shaping involves knowledge of behaviours, patience to watch the struggle for improvements, skills to identify and implement minor improvisations. Most of the supervisors do not possess the skill to identify small performance improvisations and fail to reinforce them. This ability of supervisors is essential for efficient managers; nonetheless, this ability can be gained with experience. Daniels (1989) contends that when done properly, Shaping could be the most competent and quickest way to achieve high performance if done correctly (Daniels, 1989).
Imai (1986) defines Kaizen as an ongoing improvement which involves everybody, with minimal spending. Kaizen is a strategy which calls for continuous efforts of improvisation involving everyone of an organization i.e. from top managers to workers. It forms the basis of one step at a time improvement.
Management can be divided into two functions mainly, which are maintenance and improvement (Kotelnikov, 2012). The maintenance function objective is to sustain existing standards of technology, management and operation. Improvement function aims at improvising the prevalent standards. Under the first function i.e. maintenance, the management has to firstly formulate policies, directives, rules, & SOPs (Standard Operating Procedures) and then ensure that SOPs are followed by. It can be achieved by combining discipline along with measures of HR development.
Under the second function which is the improvement, management must work continuously in order to revise the ongoing standards when mastered, to establish higher ones. Improvisation could be divided into innovation & Kaizen. Innovations involve radical development in the prevailing process and require huge investments. Kaizen implies small improvements owing to coordinated never ending efforts by the employees.
PDCA cycle is said to have its origin in the lecture of Dr. Edwards Deming in Japan (1950) Imai (1986). The PDCA is a four step series to solve problems which includes planning (problem definition and a formulating a hypothesis on the probable causes & solutions), doing (implement the plan), checking (assessing the obtained results), and finally action (going back to planning if unsatisfactory results are obtained or adopt standardization if satisfactory results are obtained).This PDCA cycle lays emphasis on preventing recurrence of errors by establishing certain standards and continuous modification of these standards. Before employing the PDCA cycle it is necessary to stabilize the existing standards. Ishikawa (1985) states that if within six months the standards ®ulations haven’t been revised then it proves that they are seriously being using by no one. Ishikawa (1985) has redefined the PDCA cycle so that the planning step includes goal determination and methods to reach the. In the second do step training & education is included along with implementation. He further says good control signifies agreeing to revise the standards to reflect consumer’s voice and complaints. By the mid 1960’s in Japan PDCA cycle had evolved to a tool of management and an improvement cycle. The seven elementary tools (i.e. check sheet, Pareto chart, histograms, graphs, fishbone diagram, scatter diagrams & stratification) focus on the main principle of a Japanese firm’s quality (Lillrank and Kano, 1989). These tools along with PDCA cycle became the basis for kaizen (improvisation) in Japan.
Many firms are of the view that TQM implementation cost is far greater compared to the benefits produced. Nevertheless, research across numerous industries has revealed that firms incur costs in achieving nothing as the direct & indirect costs spent on quality problems is far higher than TQM implementation costs.
QUALITY MEASURES ADOPTED BY STANDARD RADIATORS
Standard Radiators, a company based in Bhopal which manufactures radiators, adopted PDCA cycle approach and reaped the benefits. The problem the company was mainly facing was in inventory management. There was a constant pile up of inventory due to unavailability of various radiator parts it manufactured. The company used to manufacture thirty kinds of radiators each having ten components. The company’s needed comprehensive synchronization among its purchase, sales and production departments. But a communication gap was evident as the production unit could not meet the sales requirement and could only manufacture Justin one day 24-35 radiators. The company took twenty days for completing one load of container which contains about 600 radiators. The company often had to take space on lease for stocking the radiators that had been manufactured and sometimes the container were shipped half empty to the US.
The company knew something had to be done and on evaluation decided to implement the Daily Work process of Management. With the implementation of this process Standard Radiators could plan each day’s activity and then deliver accordingly. It also enabled it to conduct regular schedule checks and pay attention to any breakdowns of machines, unavailability of any kind of material etc. Consequently, the production capabilities of the company increased to seventy radiators per day and it also achieved a reduction in production cycle of the container load to eight days from twenty days which also helped to free up the inventory. Thus, Standard Radiators could save on their costs, achieve on-time delivery rate of 100 % to the company’s customers as a result of which the morale of the employees received a boost, which is a vital factor for a company’s success.
CONCLUSION
In the end, we can say that TQM should be adopted by all companies to enhance their productivity and increases their profits. TQM is an overall organizational approach to meet customer requirements and expectations involving each and every manager and employee to continuously improve the firm’s processes, services & products so that customers are better served and it results into profits. TQM involves nine elements which include total employee involvement, continuous improvement, continuous training, teamwork, employee empowerment, support & commitment of top management, democratic management style, customer satisfaction, and an organizational culture. In order to achieve an ultimate goal sub goals should be formed which are easier to achieve as the ultimate goal can seem impossible and might decrease the morale of employees. Thus, there is a need of Kaizen (continuous improvement) approach to be followed by all organisations.
First step to implement good manufacturing practices is to adopt the PDCA (i.e. Plan, Do, Check, Action) cycle. PDCA helps to improve, whenever Gap Analysis is done. It helps to develop counter measures which prevent recurrence of a problem, by identifying and removing its root cause. This gap analysis is PDCA cycle’s most crucial step. Standard Radiators with the help of PDCA cycle could get rid of their inventory problems and reap benefits.
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