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Total Quality Management

Intro

Total Quality Management (TQM) is a management style based on producing quality service as defined by the customer. This topic describes the history and basic tenets of TQM, explores the way it operates and some of its advantages and disadvantages, and concludes with a comparison of TQM and the authoritative management style. Martial art school owners may find some of the principles of TQM useful in school management.

Warning: this is a long article (equivalent to 19 pages in an average book).

What is TQM

Total Quality Management is a management style based on producing quality service as defined by the customer. TQM is defined as a quality-centered, customer-focused, fact-based, team-driven, senior-management-led process to achieve an organization’s strategic imperative through continuous process improvement. TQM principles are also known as total quality improvement, world-class quality, continuous quality improvement, total service quality, and total quality leadership.

The word "total" in Total Quality Management means that everyone in the organization must be involved in the continuous improvement effort, the word "quality" shows a concern for customer satisfaction, and the word "management" refers to the people and processes needed to achieve the quality.

Total Quality Management is not a program; it is a systematic, integrated, and organizational way-of-life directed at the continuous improvement of an organization. It is not a management fad; it is a proven management style used successfully for decades in organizations around the world. TQM is not an end in itself; it is a means to an organizational end. Total Quality Management must not be the primary focus of an organization; it should merely be the means to achieve organizational goals.
Total Quality Management differs from other management styles in that it is more concerned with quality during production than it is with the quality of the result of production. Other management styles have different concerns. Some major styles are compared with TQM as follows.

Management-by-Objectives (MBO) emphasizes achieving specified objectives, under the control of individual managers. This approach works against multi-functional process performance and interferes with teamwork and quality. TQM is not objective-oriented, except for its one goal of achieving continuous quality improvement.

Management-by-Results (MBR) is management by viewing past results as an indication of future results. It has been compared to driving an automobile in a forward direction while looking in the rear-view mirror. In today’s fast-paced, quick-changing business environment, managers cannot rely on past results as a predictor of future performance. In contrast, TQM is only concerned with current results and ways to improve them.

Management-by-Exception (MBE) is management by identifying specific targets for management attention and action. It produces short-term results by reacting to immediate problems, but there is no analysis of the processes that produced the problems, so long-term benefits are lost. On the other hand, TQM is more concerned with correcting processes that produce problems than it is with responding to individual problems.

Total Quality Management is very different from these and other management systems. It recognizes that quality, as determined by the service provider, might be much different from quality as perceived by the service receiver. If the customer is not satisfied with a service, then the service does not have quality and the processes that produced the service have failed.

Total Quality Management requires an organizational transformation-a totally new and different way of thinking and behaving. This transformation is not easy to achieve; it is not for the weak or the statistically untrained. At first glance, many TQM techniques may seem simple and based on common sense, but they must be understood and used correctly for TQM to function properly. Knowing the history of Total Quality Management may help in understanding its techniques.

History of TQM

Total Quality Management was developed in the mid-1940s by Dr. W. Edward Deming who at the time was an advisor in sampling at the Bureau of Census and later became a professor of statistics at the New York University Graduate School of Business Administration. He had little success convincing American businesses to adopt TQM, but his management methods did gain success in Japan.

After World War II, General MacArthur took 200 scientists and specialists, including Dr. Deming, to Japan to help rebuild the country. While working on the Japanese census, Dr. Deming was invited by the Japanese Union of Scientists and Engineers to give lectures on his statistical quality techniques. One of the attendees was a past professor of many of Japan’s CEOs. After attending the lectures, the professor told his CEO students that, if they wanted to turn Japan’s economy around in five years, they should attend Dr. Deming’s lectures on using statistics to achieve quality at a reduced cost. Many of the CEOs took the professor’s advice and attended the lectures. Eventually, many Japanese manufacturing companies adopted Dr. Deming’s theories and were able to produce quality products at reduced costs.

While the Japanese business world was concentrating on producing quality products, businesses in the United States were more concerned with producing large quantities of products. Their emphasis on quantity at the expense of quality let the Japanese, with their inexpensive, high-quality products, gain a substantial foothold in American markets.

In the 1970s and 1980s, many American companies, including Ford, IBM, and Xerox, began adopting Dr. Deming’s principles of Total Quality Management. This gradually led to their regaining some of the markets previously lost to the Japanese. Although Total Quality Management gained its prominence in the private sector, in recent years it has been adopted by some public organizations.
So far, this chapter has defined Total Quality Management, explored its origin, and explained how it emphasizes quality during production. Since quality is so important to any discussion of TQM, the next section explores this key element in detail.

Fourteen points of TQM

Any discussion of TQM operation must start with a description of Dr. Deming’s universal fourteen points of quality management. The universal fourteen points for quality management are the foundation of Total Quality Management and guide the entire TQM process. These points are discussed in detail below.

1. Create consistency of purpose with a plan toward quality improvement of service. Upper leadership should create and publish to all employees a statement of organization aims and purposes and they must constantly demonstrate their commitment to it.
2. Adopt the new philosophy of quality. Everyone, from top management to the lowest employee, must accept the quality challenge, learn their responsibilities, and take on the leadership required for the change to the new philosophy. Poor quality should never reach the customer. An organization should accept that defects in quality may occur, but it should ensure that defective products never reach the customer.
3. Cease dependence on mass inspections to achieve quality. The purpose of inspections is for improvement of processes and reduction of costs, not just to find defects. The need for mass inspections may be eliminated by building quality into a service initially.
4. End the practice of choosing suppliers based solely upon price. Organizations should stop awarding contracts based upon the lowest bid; instead, they should be concerned with minimizing total costs. Rather than trying to find the lowest bidder and then having to deal with cost overruns and low-quality products, organizations should move toward a single supplier for any one item. They may then build a long-term relationship of loyalty and trust with the supplier.
5. Identify problems and work continuously to improve the system. Organizations must improve constantly and forever the system of quality service. Many managers tend to think in terms of programs having a beginning, middle, and an end. TQM does not have an end; it is a continuous process. The phrase "continuous improvement" must become common language within the organizations.
6. Institute training. Organizations must adopt modern methods of formal training, especially for new hires. On-the-job-training is not acceptable since new hires will probably be learning the "old way" of doing things from seasoned veterans who may be resisting the change to TQM. Training also involves educating external customers as to what the organization is trying to achieve. This helps when the organization later seeks input on quality from these external customers.
7. Teach and institute leadership. The aim of leadership should not be just to tell people how to do a job, but to help people do a better job. Leadership is a learned skill, so organizations must train their managers to be good leaders.
8. Drive fear out of the workplace. Organizations must create trust and a climate for innovation so that all employees may work effectively for organizational improvement. Much of workplace fear comes from by-the-numbers performance appraisals that have numerical quotas. Employees tend to do what is required to receive a good appraisal, not what is required for quality. Employees should not be afraid to bring up new ideas and the organization should tolerate failures when employees are experimenting with new ideas.
9. Break down barriers between departments. Upper management should build teamwork between departments, not competition. They should optimize the efforts of teams toward the aims and purposes of the organization instead of fostering competition between departments.
10. Eliminate exhortations from the workplace. Management must stop using slogans and targets to request zero defects and improved productivity without providing workers the methods to achieve them. Such exhortations only create adversarial relationships. Most of the causes of low quality and productivity in an organization belong to the system and thus lie beyond the power of the workforce to change.
11. Eliminate work standards and numerical quotas for production. Upper management should stress achieving service quality rather than quantity. It should remove individual punishment/reward control systems, such as incentive pay. Eliminate Management-by-Objectives. Instead of relying on objectives to reach goals, managers should institute methods for improvement and use leadership to help workers achieve personal goals.
12. Remove barriers to pride of workmanship. Organizations should abolish merit-rating systems and not blame employees for system failures that are beyond their control.
13. Institute and encourage vigorous programs of education, retraining, and self-improvement. Use master trainers to educate and nurture the workforce. Start training with the statistical vision of the organization and then broaden it to include extended process training. Extensive follow-up training should then be used to maintain the organization’s vision.
14. Act to accomplish the transformation. Put everyone in the organization to work to accomplish the transformation. Transformation is the job of every employee, not just management. Establish some type of information center to keep the entire organization informed about transformation progress.

These fourteen points form the foundation of TQM. They are the cure for the five deadly diseases that can destroy an organization.

Fice deadly diseases

There are five deadly diseases that must be eliminated from an organization before TQM implementation may be successful. If not eliminated, they may not only prevent the TQM transformation but may gradually destroy the organization. The five deadly diseases are described as follows.

1. Bottom-line management. An organization that is only concerned with the bottom line and manages solely by-the-numbers is doomed to failure. Management is difficult work; a manager who relies heavily on numerical objectives is taking the easy way out. Managers must know the process, get involved in the process, understand the issues, and set examples for their subordinates to follow.
2. Evaluation using organized by-the-numbers performance appraisals. Evaluation using organized performance appraisals, merit ratings, or annual reviews of performance sometimes result in rankings, forced quotas, and many grading categories that act to create competition, which causes a breakdown of teamwork within an organization. Instead of using performance appraisals, managers should provide individual, personal comments to employees to help them improve.
3. Emphasis on short-term gains. When the workforce has had short-term gains rewarded in the past, there is the tendency for employees only to work toward short-term gains. Management must act to ensure employees believe the organization will give priority to a long-term improvement over short-term gains.
4. Lack of consistency of purpose. When an organization has no consistency of purpose, the workers are unsure as to their continued evolvement in the organization. An organization must have a constantly pursued long-range plan that promises attention to quality.
5. Mobility of the workforce. When employees are constantly leaving an organization, it is indicative of serious problems within the organization. Curing the other deadly diseases may help eliminate this disease. Management must take steps to ensure all employees feel they are an integral part of the organization.

Important issues

Although important to the implementation of Total Quality Management, implementation of the fourteen universal points and elimination of the five deadly diseases are only a part of the TQM transformation. Other TQM issues are discussed as follows.

Quality Framework

Three quality factors must exist in an organization for Total Quality Management to be successful. One, the organization must have an established base level of service. Two, it must have interaction and direct contact the public. Three, it must have the proper service surroundings, such as the quality of its buildings, vehicles, and equipment. Once the quality framework is established, an organization must determine its focus.

Organization Focus

Before Total Quality Management implementation, upper management must first determine the organization’s common purpose or focus. This focus sets the stage for the implementation process. Focus consists of three elements: the vision, the mission statement, and values of the organization. The vision is where the organization wants to be in the future. It reflects the organization’s continuous quest for excellence and its pursuit to fulfill customer quality expectations. Top management creates the vision, but the entire organization must embrace it for it to have any meaning. The mission statement describes the organization’s basic purpose and expected results. Values guide the organization’s conduct. They describe ways of communicating within the organization, guide relationships with customers, and generally establish ground rules for how the organization will operate. Once an organization determines its focus, it must begin empowering its employees.

Employee Empowerment

Empowering the workforce involves giving employees a degree of control over the organization’s operation. When empowered, employees feel they are an active part of the organization’s decision-making process and they have an organizational sense of "family." Once empowered, employees begin to take pride and ownership in their work, which may lead to improvement in their job performance, which then may increase overall organizational quality. As employees become more involved in the organization, they become self-motivated and do not require as much direct praise or monitoring from managers. As a part of the empowerment process, employees are permitted more management participation.

Participative Management

Participative management advocates using the cumulative skills and expertise of employees to solve problems and improve service quality. It calls for all members of an organization to share authority, responsibility, accountability, and decision making. Although it emphasizes group effort, a leader is needed who is responsible for keeping the group on track and making final decisions on group suggestions.

A delegation of responsibility and authority is required for participative management to be successful. Delegation is entrusting the responsibility and authority to complete a task to another person. Along with this trust comes accountability, which is holding the other person accountable for acceptable completion of the task. Many managers manage using the philosophy "If you want it done right, you have to do it yourself," so they find delegation difficult. Other managers do not mind delegating responsibility, but they are reluctant to delegate authority.

Participative management may meet resistance from all organizational levels. Managers may resist it since they may fear losing control or worry they will no longer be needed. Organizational traditions may hamper its use since it is so different from the way things have been done for so long. Unions may reject the team concept of participative management because they fear that allowing workers to mix with management may reduce union control of workers. Workers may reject the assumption of any responsibility for quality, maintaining that quality is the responsibility of management.

Organizational reward systems may be detrimental to participative management since they tend to recognize quantity, not quality. They usually reward individual production, not group participation.
Participative management involves giving employees membership on committees that make recommendations on changes to organizational policies. Since TQM requires the formation and use of numerous committees, it has been called management-by-committee.

Management-by-Committee

Total Quality Management uses committees to analyze specific processes and recommend changes. Three main committees are used: the executive steering committee, the quality management board, and the process action team. These committees are discussed in detail as follows.

The executive steering committee (ESC) is the core TQM committee. It is composed of top managers from each department who develop the organization’s focus, guide the organization’s cultural change, and manage resources used in the TQM process. The ESC issues charters that create the next level of committees, the quality management boards, as they are needed. A charter delineates a board’s composition, purpose, and the specific area it is to examine.

A quality management board (QMB) is an interdepartmental, cross-sectional group of middle managers created by the ESC to study a specific problem the committee has identified. The ESC may create as many quality management boards as it feels are necessary and a QMB may, in turn, charter process action teams to analyze and gather data on specific problems or processes.

A process action team (PAT) is a group of lower-level supervisors and workers created by a QMB to gather detailed data that it may use to justify its recommendations to the ESC. The PAT is the workhorse of the committee process; it does the legwork required to gather enough data to analyze a process adequately.

In a routine TQM quality improvement process, the ESC is first made aware of a problem by input from employees or customers. It considers the problem, and if it deems the problem worthy of further study, it charters a QMB to analyze the problem in detail. Many times more information is required on the problem than the QMB may collect on its own, so it may charter a PAT to collect the data. The QMB analyzes the data received from the PAT, and any other information the board has collected, and makes recommendations to the ESC on possible solutions to the problem. The ESC considers the recommendations and then either rejects them, forwards them "as is" to the head administrator, makes modifications and forwards them, or returns them to the QMB for more study.

Other types of TQM committees may be used to accomplish specific tasks, such the quality circle, process involvement team, and the self-managed team. A quality circle is usually composed of persons within the same department who try to solve minor problems with minimal management direction. A process involvement team is composed of members of the same department, or from other departments, who work on specific problems in a work process. A self-managed team is a cross-functional, interdepartmental task force with no manager or supervisor that is formed to attack an immediate problem that needs a quick solution.

All these committees must constantly collect and analyze data. Total Quality Management requires extensive statistical analysis to study processes and improve quality.

Use of Statistics

Total Quality Management requires constant statistical measurement of quality to monitor performance. All members of an organization must become proficient in the use of statistics to the level required for their position or job. This means an organization must conduct extensive statistical training for all employees. As with other management styles, Total Quality Management has advantages and disadvantages that should be considered when deciding whether TQM is the best management style for an organization.

Advantages of TQM

Short-term and long-term advantages are present in any management style. Total Quality Management has few short-term advantages. Most of its benefits are long-term and come into effect only after it is running smoothly. In large organizations, it may take several years before long-term benefits are realized.

Long-term benefits that may be expected from Total Quality Management are higher productivity, increased morale, reduced costs, and greater customer commitment. These benefits may lead to greater public support and improvement of an organization’s public image.
Eliminating errors and doing things right the first time saves time and resources. The savings may then be used for expansion of services or made available to employees in their efforts to increase service quality.

Total Quality Management may create an organizational atmosphere of excitement and sense of accomplishment through the rewarding of creativity. When experimentation-oriented failures are accepted as a part of the learning process, employees feel free to use their creative energies to develop new ideas.

Instead of mistakes being hidden from management or denied, and thus being allowed to blossom into larger less easily rectified problems, they are tolerated, and employees are encouraged to try again. Employees begin to develop a commitment to the organization rather than looking at it as just their employer. When employees feel they are an integral part of the organization, they feel needed and enjoy work more, which may further increase service quality.

Total Quality Management’s extensive use of teamwork gives employees the experience of problem-solving and using their knowledge and experiences in a collaborative effort. As employees gain experience with team problem solving, they may be used to form cross-sectional ad-hoc "mega teams" that can attack larger organization-wide problems. TQM gives an organization greater problem-solving flexibility and increases the quality of work life for all employees.

Total Quality Management may be a "profit generator," even for public organizations. It does not actually create profit for the organizations, but if implemented properly, it may identify costly processes and cost-saving measures. Once fully implemented, the only expense of TQM is the cost of routine operations. In public organizations, saved resources may be viewed as "profits."
Total Quality Management does have some detractors who have pointed out some of the disadvantages of TQM.

Disadvantages of TQM

Some Total Quality Management detractors have noted that long-range plans advocated by TQM may limit an organization’s flexibility and agility. TQM teaches that a long-term plan is required to achieve a complete quality transformation, but a long-term plan that has been pursued for a long period may become an end unto itself. Completion of the plan becomes the ultimate goal. Objectives the plan was designed to accomplish are forgotten; achieving the transformation becomes the most important objective. Instead of maintaining continuous change, the organization may reach a stable point and stagnate. To produce continuously high-quality services, an organization must react quickly to changes in the community and not be restricted by its management style.

TQM detractors also argue that although Total Quality Management calls for organizational change, it does not demand radical organizational reform. Real quality improvement requires radical structural change, such as flattening organizational structures. It requires liberation of employees from stifling control systems and the tyranny of functionalism, both of which stifle teamwork.
Total Quality Management calls for the elimination of the goals and objectives required by Management-by-Objectives. Critics of TQM claim that this may negatively affect motivation. They claim that having established production goals gives employees increasingly higher goals to reach, which motivates them to find new ways to reach the goals. When there are no established production goals, some employees will only produce the minimum required to keep their job.

Some maintain that Total Quality Management delegates the determination of quality-to-quality experts rather than to "real" people. TQM claims that quality is a complicated entity that is beyond the average employee to comprehend without specialized training in statistical techniques. It takes what is common sense to the ordinary worker and makes it sound complicated by changing the name and dressing it up with technical language.

Total Quality Management calls for the elimination of performance assessments that rate employees in relation to each other. Critics fear that without performance assessment managers would have too much power over employees and may use it capriciously. Many managers feel performance assessments let them document employee performance for a possible reward, but some employees fear the assessments might be used against them in some disciplinary actions. Performance assessments may give employees with grievances the documentation they need to prove managers are treating them unfairly. Without them, managers could make unfair accusations about an employee’s performance and the employee would not have the documentation to counter the claims.

Some argue that the claims of success by TQM supporters are not supported by facts but by anecdotes and stories. They argue that TQM proponents tell heart-warming stories about how teamwork makes everyone happy, but that they cannot back up their claims with hard data.
Critics maintain that TQM focuses manager attention on internal processes rather than on external results. When this is taken to an extreme, managers may become too preoccupied with internal issues, such as the documentation required by TQM methods, and ignore the shifting perceptions of customers. Managers become so concerned with the process of TQM that they neglect the needs of the customer, which was the initial reason for implementing TQM.

Total Quality Management calls for its implementation to be immediate and complete. Some contend it does not make sense to try to create quality improvement in the entire organization from the very beginning. They argue that not all processes are equally good or bad, not all departments function equally well, and not all services measure up to the same quality standard. Because of this, they contend that quality should be introduced incrementally and only in the specific areas that need it most.

Some critics claim Total Quality Management’s focus on setting and maintaining standards makes work life unexciting and boring. When employees are bored, their poor attitudes may cause customer dissatisfaction with the quality of service received from them. In addition, when too much emphasis is placed on standardization it precludes the constant internal changes needed to keep up with external changes.

Total Quality Management develops its own bureaucracy. TQM detractors contend its statistical burden and committee structure is cumbersome, slows organizational momentum, and consumes too much time and resources.

Opponents of Total Quality Management maintain that it appeals to egotism. After receiving some TQM training, some employees consider themselves TQM "experts" who have the answers to everyone else’s problems. They claim their department is doing everything right according to TQM principles and find fault with every other department. Some managers, instead of viewing achievement as a joint effort where every participant deserves praise, apply for awards for self-gratification or to benefit the organization’s public relations image.

Some detractors posit that TQM is an emotionally cold way to manage people. Its analytical, detached programs are often devoid of human emotion that inspires attachment to the organization and its customers.

Total Quality Management calls for a cultural transformation. Some argue it creates a process-crazed organization, like a cult, where the impression is that only total commitment to TQM can save the organization from ruin. Just as in a cult, all the decisions in TQM are related to the "vision." No one wants to claim individual credit for success; instead, success is attributed to the TQM philosophy. Results become less important than performing the proper TQM techniques. Just as in a cult, periodic evangelism by TQM experts is used to maintain a missionary zeal for TQM. If an employee is not a TQM believer, he or she considered an outcast who does not care about the organization’s success. Even with its problems, Total Quality Management may still be the best choice as a successor to the militaristic, authoritative management style.

TQM vs. authoritative style

Authoritative management is boss-centered and uses authority, fear, and coercion to influence people. The authoritative leader lacks empathy and is usually not personally likable. Total Quality Management is team-oriented, with charismatic leaders who influence people by working with them to achieve quality; it may break the "claim and blame" cycle. It does not blame anyone for problems; instead, it only seeks solutions.

It is obvious that the two styles diametrically differ in their approaches to management. Some of these differences are noted as follows:

• Authoritative management looks for the "quick fix" while TQM seeks long-term solutions.
• Authoritative management continues to operate the same old way while TQM emphasizes innovation and creative thinking.
• Authoritative management controls resources by function while TQM optimizes resources across the whole organization.
• Authoritative management seeks to control people while TQM empowers people.

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