Benefits of TQM

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1.

Increases efficiency

The main aim of implementing Total Quality Management in a business is to enhance process
efficiency and achieve productivity, by eliminating problems that arise in work systems and
processes. It addresses key areas that need modifications, unnecessary tasks, redundant
processes, as well as unproductive activities.

2. Encourages customer satisfaction

Another benefit of TQM relates to consumers satisfaction. It therefore aims at identifying the best
quality to match consumers expectations, improving quality of products and services. By predicting
mistakes and problems in work processes, TQM aims to provide quality service to meet customer
expectations.

3. Improves organizational development

Total quality management also aim at improving organizational development. It not only focus in
making changes in educating employees on the importance of quality, but also strives to prevent
mistakes in business processes instead of correcting them. Therefore, implementing TQM in your
business will help improve efficiency in production.

4. Flexibility

TQM focus on the creation of departmental teams to encourage knowledge between the
departments. These interventions can improve overall organizational development and broadening
of skills, resulting in improved performance in all departments. Moreover, this encourages flexibility
in maintaining cost competitiveness.

5. Promotes supplier/ customer satisfaction

Another reason of implementing TQM in business processes is that it promotes the principle of
internal supplier/ customer satisfaction. For example, the HR branch has the responsibility to settle
employees requests or queries within a specified time. Additionally, avoidance of errors allows the
organization to save time and many, which is then used in other processes.

Implementing TQM is costly for most businesses since it needs to train workers, disrupting
production in the process.

written by: N Nayab edited by: Michele McDonough updated: 5/20/2011

Total Quality Management (TQM) is a philosophy aimed at improving business as a whole. Some of the benefits lie in the
continuous improvement of processes and products, and enhanced efficiency of people and machines leading to improved
quality.

The application of Total Quality Management helps in streamlining processes, and ensures a proactive work system ready to
counter deviations from the ideal state. What are some of the major benefits of Total Quality Management?
The major thrust of Total Quality Management (TQM) is to achieve productivity and process efficiency by identifying and
eliminating problems in work processes and systems. TQM addresses key problem areas such as mistakes in work processes,
redundant processes, unnecessary tasks, and duplicate efforts. TQM interventions also help with predicting and pre-empting
such mistakes and unproductive activities.
Improving process efficiency brings about many benefits to the organizations in terms of costs and time.

The major benefits of TQM in terms of cost savings include:


elimination of non-confirmation and repetitive work
elimination of waste costs and reject products
elimination of repairs and reworks
reduced warranty and customer support costs
process efficiency leading to improved profit per product or service
fiscal discipline through elimination of unnecessary steps and wasteful expenditure
TQM frees up management time from redressing problems and directs management time and effort to:

increase production
extend the range of products
improve existing products

TQM and Customer Satisfaction


A major long-term benefit of Total Quality Management relates to customer satisfaction. TQM aims at improving quality,
and identifies the best measure of quality as matching customer expectations in terms of service, product, and experience.
TQM interventions quantify problems and aim to achieve the best state defined in terms of such customer expectations.

Some examples of the application of Total Quality Management to improve customer satisfaction include:
Reduction of waiting time by changing the method of appointment scheduling or client handling
Making changes to the delivery process so that the product reaches the customer faster
Better quality products requiring no repairs improving customer loyalty

TQM and Organizational Development


Among the major benefits of Total Quality Management is improvement in Organizational Development. TQM heralds a
change in the work culture by educating all employees on quality and making quality the concern of everybody, not just the
Quality Control department. The focus on quality leads to a proactive work culture aimed at preventing mistakes rather than
correcting mistakes.

Total Quality Managements focus on teamwork leads to the formation of cross-departmental teams and cross-functional
knowledge sharing. Such interventions lead to many benefits such as:

Improvement in communication skills of individual employees and overall organizational communication


Knowledge sharing, resulting in deepening and broadening of knowledge and skill-set of team members, and the
making of a Learning Organization
Flexibility for the organization in deploying personnel, contributing to rightsizing, and ensuring cost competitiveness.
Another benefit of Total Quality Management is that TQM promotes the concept of internal customer/supplier satisfaction.
For instance, the HR department considers employees as internal customers and processes their queries or requests within
the specified time limit. The lab technician in a hospital processes the clinical tests required by the doctor, an internal
customer in a timely and efficient manner, according to the laid down customer satisfaction norms.

TQM and Human Resources


A major application of benefits of Total Quality Management relate to Human Resource Management. Application of TQM
in an organization brings about the following benefits to the Human Resources of an organization:
1. TQM extends the ownership of the business process to each employee involved in the process by empowering
them to rectify mistakes on the spot without supervisor review or action. This generates intrinsic motivation and creates
an atmosphere of enthusiasm and satisfaction among the workforce.
2. TQMs thrust on eliminating mistakes and improving productivity contributes to accomplishment of targets faster. The
resultant free time allows employees to enhance their knowledge and apply their creativity to improve existing products
and develop new products.
3. TQMs thrust on quality leads to identifying skill-deficiencies in employees and providing training and other
interventions to bridge such deficiencies. Cross-functional and cross-departmental teams allow employees to share their
experience and solve issues jointly, leading to benefits such as broadening skill-sets, and improvement of existing
skills.
4. TQMs focus on eliminating mistakes and bringing about process efficiency heralds a direct approach such as
counseling and other remedial actions to solve issues such as absenteeism.
5. The enhanced productivity brought about by TQM translates to better profits for the organization, and consequently
better wages.

TQM and Competitive Advantage


The application of Total Quality Management brings forth all-round benefits and makes the organization more competitive.
In the new business environment marked by demolition of barriers and free flow of information and products, organizations
retain their competitive advantage by reducing prices, improving existing products and innovating new products. TQM is a
business strategy that allows organizations to achieve all this and much more.

Total Quality Management demolishes the myth that increased quality results in increased costs and decreased productivity.
TQM proves that quality is actually the key to decreased costs, and better productivity and positions quality as a critical
component of strategic business advantage.

References
Powell, Thomas, C. (Jan 1995). Total Quality Management as Competitive Advantage: A Review and Empirical Study
Strategic Management Journal (16.1)

VIPTaskManager. Problems and advantages of Total Quality Management. Retreived from


http://www.taskmanagementsoft.com/solutions/articles/problems-and-advantages-total-quality-management.php
Image Credit: Ken Lund. http://www.flickr.com/photos/kenlund/

Total Quality Management aims to optimize the performance of an organization via continual
improvement in the products and services provided, the operation of the internal and external
processes, equipment, utilities and most of all the people involved in an organization.
The net result is a relentless positive improvement in all aspects of an organizations
performance, for example, product reliability improvements, greater employee motivation,
improved operational efficiency, waste reduction achievements, fewer safety incidents and
overall organizational profit increases (where profit is an objective of the organization).

Looking at the above virtually all organizations daily strive to achieve such objectives. Total
Quality Management is a journey, which will never be fully achieved, however, by understanding
TQM and actively implementing many of the TQM tools and techniques, significant
performance benefits across an organization can be achieved.
Extract from TQM Tools and Techniques presentation

Looking at the benefits of Total Quality Management in some more detail.

Cost reduction.
There are a range of cost benefits associated with TQM. As part of the TQM approach,
operational processes will need to be defined. Many organizations map their processes and via
analytical tools such as brainstorming, cause and effect, etc., examine the performance of
processes, identify areas of duplication, uncertainty, over processing and re-map out their
processes to improve efficiency.
Bottleneck analysis can be performed to identify where hold-ups and delays are arising
throughout a process and implement changes to eliminate any such bottlenecks.
Cycletime analysis can be performed to understand the % of time, people and equipment are
actively involved in value adding activity, versus the % of time spent on non-value adding activity.
The net result can be quite significant in terms of costs benefits to the organization.

Customer satisfaction.
TQM is about listening to and understanding your customer. This is a critical requirement of
TQM. Who are your customers? What are their current requirements and expectations for the
future? You need to identify ALL your customers, both internal and external. Then clearly define
their needs, expectations and compare to the current product and service provision. What is the
gap between current performance and required performance? Once you know the gap, and
ideally can measure, then you are in a position to identify plans to address. These plans will be
critical to success, and will ensure organizational efforts are directed on a daily basis towards
meeting and satisfying the customer. The net result will be increasing customer satisfaction.

Product and Process Quality (including reliability).


Previously we talked about identifying customer needs and expectations. A basic requirement for
all organizations is excellent quality and reliability in terms of product or service provision. The
quality of a product or service provided needs to meet expectations. External customer
expectations will be influenced by price. Customers may expect lower quality when they pay less.
However, regardless of price, quality offered, must meet expectations. TQM seeks to continually
improve quality, while simultaneously driving down cost to the organization. Quality improvement
is achieved via the application of fact based analytical techniques. This may involve performance
of process capability analysis, SIPOC, FMEA analysis, etc.. Whatever, methods are chosen
and applied, there will be continued improvements in product and process quality. This then
offers opportunity for the organization to increase market share, or increase product selling price,
or increase profits. Such decisions will be based on the strategic direction for the business.

Employee motivation.
Total Quality Management is focused on people. Involving people, listening to and actively
encouraging participation in contributing to improving the organization. TQM is focused on
building a culture where all staff feel comfortable in identifying failings and suggesting
opportunities. Changing culture is a complex and uncertain science, however, there are well
understood approaches to encouraging positive open cultures. This may range from regular
town hall meetings, newsletters, quality improvement teams through to suggestions schemes,
employee of the month, etc..
Whatever approach is taken will depend on the organizational management and operating
environment, however an improving culture, will create higher levels of employee motivation,
lower staff turnover, more active participation and greater success rates for continuous
improvement activities.

The above are just a sample of the benefits of Total Quality Management. TQM is a
organizational philosophy, to be implement over the long term with strong management
commitment. There are however, many TQM tools and techniques, which can be applied at a
local level, which can in themselves, achieve positive benefits on performance. The decision on
which techniques to apply and how to apply resides with the staff involved within such areas.

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