Introductory Considerations
In the face of intense competition and environmental turbulence, organizations worldwide are becoming more quality and customer oriented. Providing outstanding product and service quality has evolved into a critical factor to success in our competitive world marketplace. In response to the demand for higher quality products and services a number of United States and European companies are implementing new management practices (Aldaweesh et al., 2013). Total Quality Management (TQM) is a relatively new approach to managing private and public organizations. It strives to enhance product and service quality and boost customer satisfaction by replacing conventional management methods and systems (Sallis, 2014; Salih, 2008).
Dervitsiotis (1998) defined TQM as a systematic approach to managing for quality and productivity and satisfy customers' needs focusing on continuous improvement of organizational processes (through an integrated system of tools and techniques) with participation and contribution by all members of the organization and cooperating units. This results in high quality products/services, and insures the survival and growth of the company in a competitive world.
Evaluating Total Quality Management and Excellence
According to Wilkinson et al. (1998), there is a growing body of research work on the extent of TQM and its impact on organizational effectiveness. A general finding is that TQM is increasingly being adopted both in the United States and in Europe. Most of the studies reviewed suggest that TQM can add value to an organization’s competitive strategy. The majority of the studies attribute a wide range of business performance improvements to the adoption of TQM.
A United States study attempted to link TQM and bottom-line results. The General Accounting Office (GAO) of the United States (1991) found that companies that adopted TQM practices experienced an overall improvement in corporate performance (higher productivity, better employee relations, greater customer satisfaction, increased market share, and improved profitability). GAO analyzed data in four key areas of corporate operations and found the following:
- 1.
Employees in the companies GAO reviewed experienced increased job satisfaction and improved attendance; employee turnover also decreased.
- 2.
Improved quality and lower cost were attained. Companies increased the reliability and on-time delivery of their product or service and reduced errors, and their cost of quality.
- 3.
Greater customer satisfaction was accomplished. The data on customer satisfaction was based on the results of the customers’ overall perception about a product or service, the number of complaints received, and customer retention rates.
- 4.
Improved market share and profitability were attained. As measured by several ratios widely used in financial analysis, the impact of an organization’s quality management system was improved profitability.
Swift et al. (1998) stated that institutionalizing strategy requires a culture that supports the strategy. For most organizations, a strategy based on Total Quality Management (TQM) requires a significant if not sweeping change in the way people think. The acknowledged experts agree on the need for a cultural or value system transformation.
According to Sashkin and Kiser (1993), TQM is not quality circles, statistical process control, or any other tools developed and taught by Dr. Deming and others. Such tools (for example, Control charts, Pareto charts, Histograms, Scatter diagrams, Flow charts, Fishbone diagrams, Taguchi method, Factor analysis, Affinity diagrams, etc.) are necessary because they enable people to carry out the activities that produce quality, but the tools are not TQM. Tools are necessary but not sufficient for developing a quality culture in an organization. A concern about quality for the customer that pervades every organizational operation is imperative but inadequate, as well. The top management must make a real commitment to creating a quality culture and the tools and techniques are intended to support it (Sallis, 2014).