Lecture -1

New Public Management : Concept, Scope and Significance

Introduction
As a new paradigm of public administration, New Public Management (NPM) points
to the failures and inadequacies of public sector performance over time and the
problems lying directly in the nature and processes of public sector activity and
traditional public administration. It has been established as a handy shorthand and
summary explanation of the way of reorganizing public sector bodies to bring their
management approaches closer to business methods. Size of the government,
centralized bureaucracies, inadequate mechanisms of accountability, waste and
inefficiency in resource use etc. are all problems which the new public management
sought to address.

New Public Management or NPM is an approach that seeks to build an

administration by implementing flexibility, transparency, minimum government, de-
bureaucratization, decentralization, the market orientation of public services, and
privatization. It is a paradigm shift from traditional public administration to New
Public Management.
NPM makes a citizen-friendly administration from a rigid, hierarchical, disciplined
bureaucratic administration that needs to make weak public administration strong
and effective.
New Public Management is an approach to running public service organizations that
is used in government and public service institutions and agencies, at both sub-
national and national levels.
The term was first introduced by academics in the UK and Australia to describe
approaches that were developed during the 1980s as part of an effort to make the
public service more "businesslike" and to improve its efficiency by using private
sector management models.
NPM reforms use approaches such as disaggregation, customer satisfaction
initiatives, customer service efforts, applying an entrepreneurial spirit to public
service, and introducing innovations. The NPM system allows "the expert manager
to have a greater discretion". Public Managers under the New Public Management
reforms can provide a range of choices from which customers can choose, including
the right to opt out of the service delivery system completely.

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 New Public Management

NPM is also defined as a process in which the liberal market principles of efficiency
and economy are implemented in public sector management for making public
sectors more effective.
New Public Management is also known as Managerialism, Market-based Public
Administration, Entrepreneurial Government, etc. So it is easy to identify that NPM
emphasizes three Es for reforming public sectors. These Three Es are-
1. Efficiency
2. Economy
3. Effectiveness
Evaluation of NPM
The first practices of New Public Management emerged in the United Kingdom
under the leadership of Prime Minister Margaret Thatcher. Thatcher played the
functional role of “policy entrepreneur" and the official role of prime minister.
Thatcher drove changes in public management policy in such areas as organizational
methods, civil service, labor relations, expenditure planning, financial management,
audit, evaluation, and procurement.
Thatcher's successor, John Major, kept public management policy on the agenda of
the Conservative government, leading to the implementation of the Next Steps
Initiative. Major also launched the programs of the Citizens Charter Initiative,

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Competing for Quality, Resource Accounting and Budgeting, and the Private
Finance Initiative.
A term was coined in the late 1980s to denote a new (or renewed) focus on the
importance of management and ‘production engineering’ in public service delivery,
which often linked to doctrines of economic rationalism (Hood 1989, Pollitt 1993).
During this timeframe public management became an active area of policy-making
in numerous other countries, notably in New Zealand, Australia, and Sweden. At the
same time, Organisation for Economic Co-operation and Development (OECD)
established its Public Management Committee and Secretariat (PUMA), conferring
to public management the status normally accorded more conventional domains of
policy. In the 1990s, public management was a major item on President Clinton’s
agenda. Early policy actions of the Clinton administration included launching
the National Partnership and signing into law the Government Performance and
Results Act. Currently there are few indications that public management issues will
vanish from governmental policy agendas. A recent study showed that in Italy,
municipal directors are aware of a public administration now being oriented toward
new public management where they are assessed according to the results they
produce.
The term New Public Management (NPM) expresses the idea that the cumulative
flow of policy decisions over the past twenty years has amounted to a substantial
shift in the governance and management of the “state sector” in the United
Kingdom, New Zealand, Australia, Scandinavia, North America, and Latin
America.
For instance, regional innovation agency were created under NPM principles to
support the innovation process. A benign interpretation is that these decisions have
been a defensible, if imperfect, response to policy problems. Those problems as well
as their solutions were formulated within the policy-making process. The agenda-
setting process has been heavily influenced by electoral commitments to improve
macro- economic performance and to contain growth in the public sector, as well as
by a growing perception of public bureaucracies as being inefficient. The alternative-
generation process has been heavily influenced by ideas coming from economics
and from various quarters within the field of management.

New Public Management (NPM) emerged in the 1980s and 1990s as a powerful
critique of the traditional philosophy of public administration articulated by Max
Weber – that bureaucracy made administration more efficient and rational. For
advocates of NPM, such as David Osborne and Ted Gaebler, there was a need to

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“reinvent government” and harness the “entrepreneurial spirit” to transform the
public sector and later “banish the bureaucracy.”
The reasons of emergence of NPM
➢ Private sector change and attract public sector
➢ Economic theories and changing situation
➢ Technological changes
➢ Doctrines of NPM
➢ Transformation of public sector
➢ Production Performance of public sector
➢ Professional management
➢ Target based performance
➢ Emphasize on output control
➢ Desegregation of public sector unit
➢ Provision of contract and tendering
➢ A stress on private sector styles of management practice
➢ Public organization reform on the new public management

Philosophy of New Public Management

Essentially, NPM is “a management culture that emphasizes the centrality of the
‘customer’, as well as accountability for results.” The main objective of
implementing NPM is to achieve “more transparency, more efficiency and more
quality as well as reduction of expenses.” The following represents the NPM
philosophy:
• Management culture that emphasizes the centrality of the customer
• Transparency with regard to resource allocation and results
• Organization that promotes decentralized control through a wide variety of
alternative service delivery mechanism
• NPM represents the idea of a cascading chain of contracts leading to a single
principal who is interested in getting better results within a sector portfolio
over which he/she has significant authority
• NPM is the attempt to transfer management instruments from the private
sector in a modified way into the public administration
Concepts of New Public Management
As a tool for public sector reform, NPM consists of several elements. Reformers
from all parts of the world can avail of these elements as fundamental tools in
transforming the public sector. These elements include the following:

• Lean State – reduced tasks performed by state

• Separation of Decision Making Levels – Separation of the strategic from the
operative level: politics decides the what, administration the how

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 • Lean Management – Combination of management by objectives, flat
hierarchy, project management, performance related payments, modern
methods of leadership
• New Service Attitude – Customer orientation: satisfaction in the center of all
considerations, behavioral changes
• New Model of Control – Steering by clear targets, measurement of results,
transparency of resource allocation
• Decentralization – Task, responsibility, competence and budget in the hand
of the project manager/ department manager
• Quality Management – Ensure high service quality through qualification,
competition, transparency
• Product Approach – Describing all administrative service as “products”
highlighting factors such as: features, cost, needed resources, and time to
deliver

New Public Management Characteristics

Articles related to NPM began to be written in the early 1980s, reflecting a

combination of normative principles and efforts in mapping institutional
development at a descriptive level (Hood & Peters, 2004). According to Hood (1991)
although some NPM writers emphasize different aspects of the NPM doctrine, in
fact they can be summarized into seven aspects. Those aspects are as follows
(HOOD, 1991):
1. Professional management in the public sector
2. Performance standards and performance measures
3. Greater emphasis on outputs and outcomes
4. The division of work units in the public sector
5. Competition in the public sector
6. Adoption of management of the business sector to the public sector
7. Emphasis on discipline and greater savings in using resources

From the information mentioned by diction.id, Donald Kettl (2000) calls it the term
"the global public management reform" which focuses on the following six things:
1. The government can find ways to change services from the same thing and
from a smaller revenue base.
2. The government can use market pattern incentives to improve bureaucratic
pathology. The government can replace the traditional mechanism of
bureaucratic commands with market strategies that are able to change the
bureaucratic with market strategies, which are able to change the behavior of
bureaucrats.

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 3. The government can use market mechanisms to choose the form and type of
public services, or the government can encourage those in public services to
provide better services to the public.
4. The government can make programs more responsive or decentralize greater
responsibility.
5. The government can perfect its ability to make and formulate policies.
6. The government can focus its attention on results and impacts (outputs and
inputs), compared to their attention on process and structure.
In addition, according to Vigoda and Keban, there are seven New Public
Management principles, which are:
1. Utilization of professional management in the public sector
2. Use of performance indicators
3. Greater emphasis on output control
4. Attention shift to smaller units
5. Shift to higher competition
6. Emphasis on the style of the private sector on the application of management
7. Emphasis on discipline and higher savings in resource use

Aspects of NPM

NPM was accepted as the "gold standard for administrative reform" in the 1990s.
The idea for using this method for government reform was that if the government
guided private-sector principles were used rather than rigid hierarchical bureaucracy,
it would work more efficiently. NPM promotes a shift from bureaucratic
administration to business-like professional management. NPM was cited as the
solution for management ills in various organizational context and policy making in
education and health care reform. The basic principles of NPM can best be described
when split into seven different aspects elaborated by Christopher Hood in 1991.
Hood also invented the term NPM itself. They are the following:
Management
Because of its belief in the importance and strength of privatizing government, it is
critical to have an emphasis on management by engaging in hands-on methods. This
theory allows leaders the freedom to manage freely and open up discretion.
Performance standards
Its critical to preserve express measures and measures of execution in a workforce.
Utilizing this strategy advances clarification of goals/intent, targets, and markers for
movement.
Output controls
The third point acknowledges the "shift from the use of input controls and
bureaucratic procedures to rules relying on output controls measured by quantitive

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performance indicators". This aspect requires using performance-based assessments
when looking to outsource work to private companies/groups.
Decentralization
NPM advocates frequently moved from a bound together administration framework
to a decentralized framework in which directors pick up adaptability and are not
constrained to organization restrictions.
Competition
This characteristic centers on how NPM can advance competition within the public
sector which may in turn lower fetched, dispose of debate and conceivably
accomplish a better quality of progress/work through the term contacts. Competition
can too be found when the government offers contracts to the private segments and
the contract is given in terms of the capacity to provide the benefit viably, quality of
the merchandise given, subsequently this will increment competition since the other
private division which did not get the contract will make strides to make strides the
quality and capacity subsequently encouraging competition.
Private-sector management
This viewpoint centers on the need to set up short-term labor contracts, create
corporate plans or trade plans, execution assentions and mission statements. It
moreover centers on setting up a working environment in which open representatives
or temporary workers are mindful of the objectives and intention that offices are
attempting to reach.
Cost reduction
The most effective one which has led to its ascent into global popularity, focuses on
keeping cost low and efficiency high. "Doing more with less" moreover cost
reduction stimulates efficiency and is one way which makes it different from the
traditional of management approach
Principles of New Public Management
The following principles of NPM can be identified from the above discussion.
1. The main principle of NPM is to emphasize economy, efficiency, and
effectiveness by downplaying the importance of regulation.
2. Reorganizing the bureaucracy into different agencies.
3. Increase competition through the introduction of quasi-market systems and
contract systems.
4. Expenses reduce and facilitate income growth.
5. Shift to greater competition in public sectors.

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 6. NPM emphasizes more on private-sector styles of management.
7. Managerialism that means the role of the administrator transforms as a
manager.
8. Increasing the flexibility and mobility of organizational structure, personnel,
and working conditions.
9. Greater emphasis on consumerism. To NPM citizens are considered as
consumers.
10.Secure participation of people through the decentralization process.
Features of New Public Management
Although principals can be identified as features. It highlighted some of the
following features of the new public management from the above principles.
1. Citizen’s empowerment
2. Decentralization
3. Restructuring of Government organization or sector
4. Goal-Orientation
5. Cost Cutting and facilitates income growth
6. Managerial Support services
7. Secure better service to the citizens
1. Citizen’s empowerment
Empowerment of citizens is one of the major features of New Public Management.
NPM assures citizen’s freedom of choice. It secures quality services to the citizens.
Healthy competition among the service and product’s sectors allow citizens to
choose their service and products according to their needs and choice.
2. Decentralization
NPM focuses on the decentralization of power from rigid, hierarchical bureaucratic
to flexible and dynamic managerial support systems.
3. Restructuring of Government organization or sector
New public management restructures the governmental organization or sectors. The
government divides each of its sectors into smaller units and assigns responsibilities
to the private sector through contracts.
4. Goal-Orientation
Its main purpose is to achieve specific goals. That is why NPM more emphasises on
the outcomes rather than procedures and rules.
5. Cost Cutting and facilitates income growth
The main purpose of contracting out of governmental sectors is to reduce the cost of
the government and secure maximum income of the government.
6. Managerial Support services
The main purpose of the managerial support services to secure citizen’s quality
service. For this reason, the best talent from the market are hired by offering

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handsome salary, incentives and other benefits. NPM always suggests skill
improving training programmes for getting maximum outcomes.
7. Secure better service to the citizens
It is already stated that the main purpose of implementing New Public management
is to secure citizen’s quality services.
Comparisons to New Public Administration
New Public Management is often mistakenly compared to New Public
Administration. The ‘New Public Administration’ movement was one established in
the USA during the late 1960s and early 1970s. Though there may be some common
features, the central themes of the two movements are different. The main thrust of
the New Public Administration movement was to bring academic public
administration into line with an anti-hierarchical egalitarian movement that was
influential in US university campuses and public sector workers. By contrast, the
emphasis of the New Public Management movement a decade or so later was firmly
managerial normative in that it stressed the difference that management could and
should make in the quality and efficiency of public services. It focuses on public
service production functions and operational issues contrasted with the focus on
public accountability, ‘model employer’ public service values, ‘due process,’ and
what happens inside public organizations in conventional public administration.
The table below gives a side-by-side comparison of the two systems core
aspects/characteristics
New Public Management New Public Administration
Hands on approach Anti-hierarchical, Anti-positivist
Explicit standards Democratic Citizenship
Emphasis on output control Internal regulations
Disconnection of units Equity
Importance of the private sector Importance of public citizens
Improve timing Stability
Greater usage of money Socioemotional

SOURCE: Fredrickson, H. George (2004). Toward a New Public Administration. ]. Boston, MA: Wadsworth
Cengage Learning. pp. 294–305. ISBN 978-1-111-34274-6.

Conclusion
New Public Management (NPM) was an important issue in public sector reform. In
addition, the concept of NPM also had links with public sector performance

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management issues because performance measurement was one of the main
principles of NPM. NPM movement initially occurred in developed countries in
Europe, but in its development, the concept of NPM had become a global movement
so that developing countries were also affected by the global spread of this concept.
New Public Management (NPM) is a new paradigm of public management that puts
forward a different relationship between governments, the public service and the
public. There have been changes in the public sector and reforms of an
unprecedented kind.

References
1. CHAKRABARTY, BIDYUT KANDPAL PRAKASH CHAND. PUBLIC
ADMINISTRATION IN A GLOBALIZING WORLD: Theories and Practices. SAGE
INDIA, 2012.
2. Osborne, D. and Gaebler, T., Reinventing Government: How the Entrepreneurial Spirit is
Transforming the Public Sector, Adison-Wesley, Mass, 1992.
3. Hood, Christopher (1 March 1991). "A Public Management for all Seasons?". Public
Administration. 69 (1): 3–19. doi:10.1111/j.1467-9299.1991.tb00779.x. and Hood and
Jackson 1991
4. Farazmand, Ali (February 2, 2006). "New Public Management". Handbook of
Globalization, Governance, and Public Administration: 888.
5. Barzelay (2001). The New Public Management: Improving Research and Policy Dialogue.
Russell Sage Foundation.
6. Kaboolian, Linda (1998). The New Public Management: Challenging the Boundaries of
the Management vs. Administration Debate. Public Administration Review.
7. Marozzi, Marco; Bolzan, Mario (2015). "Skills and training requirements of municipal
directors: A statistical assessment". Quality and Quantity. 50 (3): 1093–
1115. doi:10.1007/s11135-015-0192-2.
8. Morisson, A. & Doussineau, M. (2019). Regional innovation governance and place-based
policies: design, implementation and implications. Regional Studies, Regional
Science,6(1),101–
116. https://rsa.tandfonline.com/doi/full/10.1080/21681376.2019.1578257.
9. Farazmand, Ali (Jan 2, 2006). "New Public Management: Theory, Ideology, and
Practice". Handbook of Globalization, Governance and Public Administration.
10. Denhardt & Denhardt (2011). The New Public Service: Serving, Not Steering. Armonk,
New York: M.E. Sharp. pp. 25–43. ISBN 978-0-7656-2625-7.
11. Barzelay (2001). The New Public Management: Improving Research and Policy Dialogue.
Russell Sage Foundation.
12. Pfiffner, James. "Public Administration versus The New Public Management"(PDF).
Retrieved 18 November 2015.
13. Fredrickson, H. George (2004). Toward a New Public Administration [In Shafritz & Hyde
(eds). Classics of Public Administration]. Boston, MA: Wadsworth Cengage Learning.
pp. 294–305. ISBN 978-1-111-34274-6.

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 Lecture- 2
Total Quality Management (TQM): history, Features,
Principle, Benefits and 14 points by Deming.
Total quality management (TQM) is the continual process of detecting and reducing
or eliminating errors in manufacturing, streamlining supply chain management,
improving the customer experience, and ensuring that employees are up to speed
with training. Total quality management aims to hold all parties involved in the
production process accountable for the overall quality of the final product or service.
A core definition of total quality management (TQM) describes a management
approach to long-term success through customer satisfaction. In a TQM effort, all
members of an organization participate in improving processes, products, services,
and the culture in which they work.
Total Quality Management means:
• Total – everything • Quality – degree of excellence
• Management – art, act or way of organizing, controlling, planning, directing to
achieve certain goals.
So, Total Quality Management means “The way of managing organization to
achieve excellence”.
Total quality management (TQM) is a structured approach to overall organizational
management. The focus of the process is to improve the quality of an organization's
outputs, including goods and services, through continual improvement of internal
practices. The standards set as part of the TQM approach can reflect both internal
priorities and any industry standards currently in place. Industry standards can be
defined at multiple levels and may include adherence to various laws and regulations
governing the operation of the particular business. Industry standards can also
include the production of items to an understood norm, even if the norm is not
backed by official regulations.

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Total Quality Management Example:
Perhaps the most famous example of TQM is Toyota's implementation of
the Kanban system. A kanban is a physical signal that creates a chain reaction,
resulting in a specific action. Toyota used this idea to implement its just-in-time (JIT)
inventory process. To make its assembly line more efficient, the company decided
to keep just enough inventory on hand to fill customer orders as they were generated.
Therefore, all parts of Toyota's assembly line are assigned a physical card that has
an associated inventory number. Right before a part is installed in a car, the card is
removed and moved up the supply chain, effectively requesting another of the same
part. This allows the company to keep its inventory lean and not overstock
unnecessary assets. Effective quality management resulted in better automobiles that
could be produced at an affordable price.
Total Quality Management is a process to ensure that all work aims toward the
common goal of improving product quality or service. TQM also enhances the
production process or process of delivering service. However, in TQM the emphasis
lies on fact-based decision making which uses performance matrices to monitor
progress.

TQM was developed by William Deming, a management consultant whose work

had a great impact on Japanese manufacturing.

History of Total Quality Management (TQM)

The history of total quality management (TQM) began initially as a term coined by
the Naval Air Systems Command to describe its Japanese-style management
approach to quality improvement. Total Quality Management (TQM) originated in
1954 from the industrial sector of Japan. However, its history dates back to the
1920’s. In the 1980s, this concept became more popular and has been continually
developed for use in schools, hospitals, hotels and other organizations. Nowadays,
e-businesses are also employing the Total Quality Management principles.

History of Total Quality Management (TQM)

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Features of Total Quality Management

• Total quality management (TQM) is an ongoing process of detecting and

reducing or eliminating errors.
• It is used to streamline supply chain management, improve customer service,
and ensure that employees are trained.
• The focus is to improve the quality of an organization's outputs, including
goods and services, through continual improvement of internal practices.
• Total quality management aims to hold all parties involved in the production
process accountable for the overall quality of the final product or service.

Hence, the objective of Total Quality Management is to do the right things the first
time continuously, thereby saving the time the organization would have used in
correcting errors. Total Quality Management principles are beneficial to any
organization because it reduces cost, increases staff morale, reduces errors and
increases customer satisfaction.
In addition, Total Quality Management works better in organizations where
management strongly supports these principles.

Primary Principles or elements of Total Quality Management

TQM is considered a customer-focused process and aims for continual improvement

of business operations. It strives to ensure all associated employees work toward the
common goals of improving product or service quality, as well as improving the
procedures that are in place for production. Special emphasis is put on fact-based
decision making, using performance metrics to monitor progress; high levels of
organizational communication are encouraged for the purpose of maintaining
employee involvement and morale.

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TQM can be summarized as a management system for a customer-focused
organization that involves all employees in continual improvement. It uses strategy,
data, and effective communications to integrate the quality discipline into the culture
and activities of the organization. Many of these concepts are present in
modern quality management systems, the successor to TQM. Here are the 8
principles of total quality management:

1. Customer-focused: The customer ultimately determines the level of

quality. No matter what an organization does to foster
quality improvement—training employees, integrating quality into the
design process, or upgrading computers or software—the customer
determines whether the efforts were worthwhile.
2. Total employee involvement: All employees participate in working
toward common goals. Total employee commitment can only be obtained
after fear has been driven from the workplace, when empowerment has
occurred, and when management has provided the proper environment.
High-performance work systems integrate continuous improvement efforts
with normal business operations. Self-managed work teams are one form of
empowerment.
3. Process-centered: A fundamental part of TQM is a focus on process
thinking. A process is a series of steps that take inputs from suppliers
(internal or external) and transforms them into outputs that are delivered to
customers (internal or external). The steps required to carry out the process
are defined, and performance measures are continuously monitored in order
to detect unexpected variation.
4. Integrated system: Although an organization may consist of many
different functional specialties often organized into vertically structured
departments, it is the horizontal processes interconnecting these functions
that are the focus of TQM.
▪ Micro-processes add up to larger processes, and all processes
aggregate into the business processes required for defining and
implementing strategy. Everyone must understand the vision,
mission, and guiding principles as well as the quality policies,
objectives, and critical processes of the organization. Business
performance must be monitored and communicated
continuously.
▪ An integrated business system may be modeled after
the Baldrige Award criteria and/or incorporate the ISO 9000
standards. Every organization has a unique work culture, and

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 it is virtually impossible to achieve excellence in its products
and services unless a good quality culture has been fostered.
Thus, an integrated system connects business improvement
elements in an attempt to continually improve and exceed the
expectations of customers, employees, and other stakeholders.
5. Strategic and systematic approach: A critical part of the management of
quality is the strategic and systematic approach to achieving an
organization’s vision, mission, and goals. This process, called strategic
planning or strategic management, includes the formulation of a strategic
plan that integrates quality as a core component.
6. Continual improvement: A large aspect of TQM is continual process
improvement. Continual improvement drives an organization to be both
analytical and creative in finding ways to become more competitive and
more effective at meeting stakeholder expectations.
7. Fact-based decision making: In order to know how well an organization
is performing, data on performance measures are necessary. TQM requires
that an organization continually collect and analyze data in order to improve
decision making accuracy, achieve consensus, and allow prediction based
on past history.
8. Communications: During times of organizational change, as well as part
of day-to-day operation, effective communications plays a large part in
maintaining morale and in motivating employees at all levels.
Communications involve strategies, method, and timeliness.

Figure: Primary Elements of Total Quality Management (TQM)

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These elements are considered so essential to TQM that many organizations define
them, in some format, as a set of core values and principles on which the organization
is to operate.
Benefits of TQM
Total quality management (TQM) as a term to describe an organization's quality
policy and procedure has fallen out of favor as international standards for quality
management have been developed. Total quality management benefits and
advantages:
1. Strengthened competitive position
2. Adaptability to changing or emerging market conditions and to environmental
and other government regulations
3. Higher productivity
4. Enhanced market image
5. Elimination of defects and waste
6. Reduced costs and better cost management
7. Higher profitability
8. Improved customer focus and satisfaction
9. Increased customer loyalty and retention
10.Increased job security
11.Improved employee morale
12.Enhanced shareholder and stakeholder value
13.Improved and innovative processes
14.Reduce risk and mitigate risk when designing new products and processes
15.Resolve problems before they occur
16.Resolve problems that occur during operations
17.Improve supplier performance
18.Control processes to avoid risk even when scaling up
19.Increase productivity or all employees
20.Reduce the total cost of quality not just the costs of poor quality of products

W. Edwards Deming’s 14 Points on Total Quality Management

W. Edwards Deming’s 14 Points on Quality Management, or the Deming Model of
Quality Management, a core concept on implementing total quality
management (TQM), is a set of management practices to help companies increase
their quality and productivity.

1. Create constancy of purpose for improving products and services.

2. Adopt the new philosophy.
3. Cease dependence on inspection to achieve quality.
4. End the practice of awarding business on price alone; instead, minimize total cost by
working with a single supplier.

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 5. Improve constantly and forever every process for planning, production and service.
6. Institute training on the job.
7. Adopt and institute leadership.
8. Drive out fear.
9. Break down barriers between staff areas.
10. Eliminate slogans, exhortations and targets for the workforce.
11. Eliminate numerical quotas for the workforce and numerical goals for management.
12. Remove barriers that rob people of pride of workmanship, and eliminate the annual
rating or merit system.
13. Institute a vigorous program of education and self-improvement for everyone.
14. Put everybody in the company to work accomplishing the transformation.

These total quality management principles can be put into place by any organization
to more effectively implement total quality management.
Conclusion
In conclusion, total quality management principles work best in organizations that
put in place processes for continuous improvement that ensure quality. Generally,
there are eight basic principles of total quality management. Customer focus centres
on designing products and services that customers desire while meeting and
exceeding their needs. On the other hand, leadership is the tool that is used to model
and drive quality in all sectors of the organization. People involvement establishes
teamwork and involvement in decision-making while process approach achieves
efficiency and effectiveness. In addition, system approach to management makes
sure that multiple processes are managed as a system. Continual improvement, on
the other hand, makes the organization flexible to inevitable changes in market
situations. While evidence-based decision-making involves data and information
collation and analysis, mutually beneficial supplier relationships promote strong
relationships between the organization and its suppliers. Finally, the importance of
total quality management cannot be over emphasised. When total quality
management principles are employed in any organization, profitability is increased
while errors and waste are minimized. Also, customer feedback, customer
satisfaction and customer loyalty are achieved.
Reference:
1. American Society for Quality. "W. Edwards Deming." Accessed Aug. 21, 2020.
2. Adam Barone, Total Quality Management (TQM) BUSINESS ESSENTIALS.
3. The Certified Manager of Quality / organization Excellence Handbook, Fourth Edition.
ASQ Quality Press.

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 Lecture- 3
TQM IN JAPAN
Deming, Juran and Ishikawa
Dennis S. Tachiki
Faculty of Business Administration Tamagawa University
[email protected]
If Japan can achieve high quality products and services, why can’t Bangladesh?
The current situation in this country is very similar to the situation in Japan
between the two world wars. This briefing paper outlines some of the major
measures Japan adopted to rise from the ashes of war and become an economic
power.
The field of quality control in Japan dates back to the 1930s, when Japanese scholars
were active in translating the British statistician E.S. Pearson’s book on the
Application of Statistical Methods of Industrial Standardization and Quality Control
(1935), the American statistician Walter A. Shewhart’s book on the Economic
Control of Quality of Manufactured Products (1931) and other related materials to
improve industrial production. Much of this know how stayed in the hands of a small
group of statisticians and engineers; however, after World War II many managers
began to use these ideas in their daily business activities. 1 W. Edwards Deming,
Joseph M. Juran and the Union of Japanese Scientists and Engineers (JUSE) played
important roles in shaping what we now know as total quality management (TQM).
W. Edwards Deming
In 1949, the Supreme Commander of Allied Powers, the allied occupation forces
headquarters, invited the distinguished statistician W. Edwards Deming to Japan. He
would return to Japan one year later to lecture at the now famous eight-day JUSE
seminars where he introduced the quality control practitioners to three basic ideas.
• The first idea Deming introduced to JUSE was the PDCA Cycle—Plan, Do, Check
and Action.
PDCA CYCLE

PLAN

ACTION DO

CHECK

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Managers are expected to make business decisions but they do not always have the
resources to fully execute it. The PDCA Cycle is a systematic method guiding
managers to consider not only going from planning to execution, but continuing
further to evaluate whether a work unit’s goals have been achieved (check) and then
decide what remedial steps are necessary to achieve their work unit’s goals (action).
In the plan phase, you define a problem and the methods for solving it. In the do
phase you engage in education and training and then implement the plan. In the
check phase you evaluate the effects of the implementation based on the measures
and metrics adopted in the plan phase. And in the action phase you take the
appropriate measures to close the performance gap between what was planned and
the actual outcomes. This cycle is repeated continuously (i.e., kaizen) leading to
better and better levels of product and service quality.
• The second idea he introduced to the JUSE was Shewhart’s statistical quality
control (SQC) and statistical process control (SPC) techniques. Managers are
expected to make “on the spot decisions;” however they have little time to look at
the big picture. To allow managers to see the bigger picture, Deming demonstrated
the power of “managing by fact, not by guts (i.e., intuition)” through statistical
methods. In this connection, perhaps the most known SQC/SPC tool is the control
charts.

A control chart shows whether a process is stable or abnormal. Take the case of a
client visiting a local government agency to request a residency document. The work
2
unit policy is to process the document within one day (lower limit) but no more than
seven days (upper limit). Current it takes on average (x) three and half days. A
process is stable if the line graph over t1 , t 2 , t3 , t4 and t5 (where t = time period
interval for collecting sample data on a business activity within a work unit) is within
the upper and lower limits. This is the case for time periods t1 , t 2 , t3 and t5.
Fluctuations outside the upper and lower limits indicate abnormality that must be
investigated and eliminated. This is the case in time period t4 . Instead of waiting for
client complaints, a manager would immediately know something is wrong in the
processing documents and would investigate what corrective action to take. Deming
showed the JUSE how to apply this simple but powerful chart in reducing defects
and achieving quality standards.
• The third idea he introduced was the importance of sampling inspection and
dispersion—range, average deviation, variance and standard deviation—in
statistical data. The basic assumption underlying this concept is that all production
processes fluctuate; however, it is important to differentiate between naturally
occurring fluctuations (uncontrollable) and unwanted errors (controllable). For
example, in the control chart above, the trend line for R (range) does not exceed the
upper and lower limit at t4 , suggesting this may be an uncontrollable fluctuation—
that is, in this case a national strike. Deming showed the JUSE how to use these
statistical concepts to identify and focus on eliminating unwanted errors from work
activities. In short, Deming’s main contribution to the development of Japanese TQC
was to introduce the concepts and statistical tools for improving product and service
quality (see Deming 1986 on his “13 Points”). In his honor, the JUSE named their
prestigious quality control award after him—that is, the Deming Prize.
Joseph M. Juran
When JUSE first began promoting the TQC idea in Japan, it encountered resistance
from senior and middle management. Senior managers saw quality control activities
as adding unnecessary overhead costs. Middle managers did not want the technical
staff to interfere in the administration of their work units. In 1954, the JUSE invited
Joseph M. Juran, a management consultant, to deliver a series of lectures under the
theme of “Quality Control and Management” to learn how to unblock these
organizational bottlenecks.
• For senior managers who think quality control activities are a waste of time, Juran
drew upon the Pareto principle in response. This principle states that some
phenomena occur more frequently (the vital few) than others (the trivial many). To

3
illustrate this principle, he introduced the JUSE to the Pareto Diagram, a simple tool
for rank ordering the frequency a problem occurs. In the figure below, the horizontal
axis lists the possible causes contributing to a work issue. For example, out of the
eight problems delaying a client receiving her/his residency document within one
week from a local government agency, just eliminating “missing information” would
save three days in document processing time. After solving this problem, the next
step is to provide more staff training and then consider purchasing computers. In
short, a Pareto Diagram allows managers to distinguish between the vital few issues
from the trivial many issues. Then, rather than “fighting fires” (handling problems
as they arise each day), top management should proceed step-by-step to solve the
issues hindering employees from achieving the overall goals of their work unit.

PARETO DIAGRAM days % 7 100 50 0

• A second message he conveyed to the JUSE is that middle managers play a key
role in planning, control and improvement of product quality, the three key elements
of the Juran trilogy (Juran and Godfrey 1998). Juran pointed out that quality control

4
refers to not only product quality, but also the quality of the work process. The
technical staff has responsibility for product quality but it is the middle managers
who have direct line responsibility for ensuring that the work process flows
smoothly. Consequently, as products move across functional departments, managers
must cooperate with each other to eliminate unwanted errors and delays causing
consumers dissatisfaction. Juran’s main contribution to Japanese TQC, then, was to
bring management into the quality control picture formerly dominated by the
technical staff. In doing so, the JUSE began to shift its national quality promotion
activities from a focus primarily on statistical quality control techniques and towards
what would become total quality management.
Quality Control Research Group
Engineers and academics established the Union of Japanese Scientists and Engineers
(JUSE) in 1946 to promote the use of quality control methods in Japanese industry
(see http://www.juse.or.jp). This organization carries out a wide range of activities;
however, let me focus on the activities of the Quality Control Research Group
(QCRG) to illustrate how to take the know how from other countries and adapt it to
the local sensibilities in one’s own country. JUSE organized the QCRG in 1949 to
scan the international quality control field for best practice in three areas: (1)
methods for rationalizing production in industry, (2) methods for improving the
quality of export goods and (3) methods that would raise the living standards of the
Japanese people from the ashes of war. In short, the mission of the QCRG clearly
linked quality control methods to national policies addressing issues confronting
industry and society.
• Under this mandate, one key point about the QCRG is that the members were
academics and practitioners rather than consultants. When academics and
practitioners evaluate a wide variety of quality control methods they are more
objective in distinguish between a management fad and what is best practice than
consultants who are unlikely to promote a method related to their consulting
services. Consequently, early in this history of TQM in Japan, companies could
avoid the costly search cost and the even more costly consultant fee in order to arrive
at best practice. This was an important factor in the relatively rapid spread of the
TQC idea across the private sector in Japan. By putting the private consultant in a
supportive role and giving academics and practitioners the leading role in evaluating
best practice, it is interesting to note that the Japanese business community was
quicker in realizing the merits of Deming and Juran’s approaches to quality control

5
than their American counterparts. Indeed, the Americans were to ask several decades
later in a famous NBC television program “If Japan Can, Why Can’t We?”
• Another key point about the QCRG is that they did not naively adopt a best
practice. What works in one culture does not necessarily work in another culture.
Instead the QCRG experimented with ways to adapt the foreign ideas to the Japanese
business environment. For example, one innovation was to make quality control not
only the responsibility of the technical staff, but also the line managers. This reduces
the tension between staff and line mangers over “turf” (scope of responsibility) as
well as make quality a central part of a work unit’s daily business activities rather
than “something extra” you do if you have time. Many of these simple adaptations
of best practice made the content of the QC Basic Course, a 30 – 36 day training
workshop spread over six months, much easier for managers and engineers to
understand the concept of TQC.
Kaoru Ishikawa, a prominent figure in the QCRG, played a major role in the
development and diffusion of the TQC idea in Japan. He was instrumental in (1)
simplifying complex statistical concepts and tools for use in business (e.g., cause
and effect diagram, also called the Ishikawa Diagram) and (2) turning the product
development sequence on its head by starting with the “voice of the customer” rather
than research and development. It is still worth reading his publications, especially
What Is Total Quality Control? (1985) and Introduction to Quality Control (1990).
UNION OF JAPANESE SCIENTISTS AND ENGINEERS
Engineers and academics established the Union of Japanese Scientists and Engineers
(JUSE) in 1946 to promote the use of quality control methods in Japanese industry.
This organization carries out a wide range of activities (see next section on JUSE).
In connection to our discussion, however, let me focus on the activities of the
Quality Control Research Group (QCRG) to illustrate how to take the know-how
from other countries and adapt it to the local sensibilities in one’s own country. JUSE
organized the QCRG in 1949. Members of this research group were active in
scanning the international quality control field for information in three areas. First,
methods for rationalizing production in industry. Second, methods for improving the
quality of export goods. And third, methods that would raise the living standards of
the Japanese people from the ashes of war. In short, the QCRG had a clear mission
to address pressing issues confronting industry and society through quality control
methods. The QCRG played a pivotal role in scanning for best practice in quality
control, adapting it to the Japanese business environment and diffusing it through
6
low-cost publications and training courses. One key point about the QCRG is that
they evaluated a wide variety of quality control methods to distinguish between a
management fad and what is best practice. Consequently, companies could avoid the
costly search cost and the even more costly consultant fee in order to arrive at best
practice. This was an important factor in the relatively rapid spread of the TQC idea
across the private sector in Japan. In this connection, it is interesting to note that the
Japanese business community was quicker in realizing the merits of Deming and
Juran’s approaches to quality control than their American counterparts. Indeed, the
Americans were to ask several decades later in a famous NBC television program
“If Japan Can, Why Can’t We?” Another key point about the QCRG activities is that
they did not naively adopt a best practice. Instead they experimented with ways to
adapt the foreign ideas to the Japanese business environment. For example, one
innovation was to make quality control not only the responsibility of the technical
staff, but also the line managers. This reduces the tension between staff and line
mangers over “turf” (scope of responsibility) as well as make quality a central part
of a work unit’s daily business activities rather than “something extra” you do if you
have time. These simple innovations are the basis for the QC Basic Course, a 30 –
36 day training workshop spread over six months on quality control for managers
and engineers. Today JUSE is among the leading organizations promoting quality
control in Japan. It is the headquarters for QC circle activities in Japan and the
secretariat for the prestigious Deming Prize. JUSE also plays an important role in
promoting quality control throughout the world through involvement in such
organizations as the International Association of Quality and the International
Convention for QC Circles.
Kaoru Ishikawa was a prominent figure in the JUSE. He played a major role in the
development of the TQC idea in Japan (Ishikawa 1990) and with his wide circle of
colleagues and students he was instrumental in (1) simplifying complex statistical
concepts and tools for use in business (e.g., cause and effect diagram, also called the
Ishikawa Diagram) and (2) turning the product development sequence on its head
by starting with the “voice of the customer” rather than research and development.
It is still worth reading his publications, especially What Is Total Quality Control?
(1985)

----------------

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 Features of Japanese Quality Management (Metrology)
It is desirable to study the salient features of Japanese Quality Management for
drawing some lessons from it. First of all, Japan is an Asian Country like ours, who
has been successful of late in technical capability and Quality in particular. Rather,
it is the undoubtable leader in Quality in the whole world today.
Secondly, although its technological base is largely from Europe or America, it has
a national talent to absorb by adopting some Scientific Management Principles,
globally practised more successfully even compared to their soil of origin.
Thirdly, though Japan had a poor reputation for Quality even as late as pre-second
World War days, within a short span, it has achieved a unique status in Quality.
It has a robust private industry with strong national backing. The example of large
number of tiny, small, medium sector industries living with the large and giant units
and still be able to meet all Quality needs because of nationwide Quality
consciousness and commitment is spectacular and a lesson for manufacturers and
vendors in our country. Therefore, it is essential to study JAPAN as a model of
Quality Management from a closer angle.

The Salient Features of the Japanese Quality Management are:

(a) Company-wide quality control:
➢ Company-wide participation, from top management to all levels of
employees.
➢ Participation Not only by departments of technology, design, research and
manufacturing but also by sales, materials, clerical and other management
departments like planning, finance, personnel, business development, etc.
➢ Q.C. concepts used Not only in incoming material control, production
process, new product design control, but also in business analysis for new
company policy, for checking if top management policy is being
implemented, for control of personnel and labour, for solving sales problem,
etc.
(b) Quality education and training:
➢ Company-wide Quality Control, requiring participation by all in Q.C.
activities, call for education from top management to Bottom level worker.
➢ Such education and training enable each employee to display his capabilities
fully. (Hi) Eventually infinite possibilities emerge, both individual and
company gaining benefit and profit.

8
 ➢ Organisation of large number of long- term seminars.
➢ For each company, such initial training requires more than three years to
educate all executives involved.

(c) Application of S.Q.C. methods :

➢ Through education and training in SQC methods, all employees can apply
SQC in practice.
➢ Application of SQC is one of the pillars of Japanese QC. (Hi) Simple SQC
methods very widely employed.
➢ Extremely high level SQC methods developed to suit different problems.
(d) Quality control audit:
➢ QC Audit carried out by Top Management of Company.
➢ Each department Head carries out internal audit in his department. (Hi) QC
Audit for affiliated companies and sub-suppliers.
(e) Q.C. circle activities:
➢ A QC Circle is a permanent group with a leader and a few Circle members,
usually 7-10 persons per group.
➢ At present, in Japan, over one million QC Circles exist.
➢ QC Circle leader and some members trained in SQC methods and application.
(iv) Each circle voluntarily performs QC activities involving in self-
development Quality Control and improvements.
(f) Nation-wide QC promotion activities:
➢ In November every year, various events organised to observe “Quality
Month”.
➢ QC Circle conferences-about 100 per year all over Japan. (Hi) QC Annual
Conferences.

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 6 ESSENTIAL FACTORS FOR ACHIEVING SUCCESSFUL TQM
IMPLEMENTATION IN A COMPANY
The past decade has seen many organizations focus on Total Quality Management
(TQM). In spite of the current competitiveness of the business climate, every
organization’s desires to survive, be successful, to expand and grow. Total quality
management (TQM) is a technique of managing to enhance efficiency, profits,
market share, cohesiveness, flexibility and competitiveness of a firm as a whole. But,
for that, you need to do careful planning and good management quality for their
products and services. The following factors are considered as essential and crucial
for achieving successful TQM execution within any company.

1) Management commitment and understanding:

It is utmost important that every worker within an organization must be aware of the
Total quality management policies. These policies should be made a significant part
of their work. Every employee needs to know your company’s “ifs and buts.” Also,
the importance of corporate goals to the overall success of your firm. Every
employee must know about their priorities, tasks, goals, and what is expected from
them and why. The world of potential is unleashed if employees comprehend the
company’s vision and share the same as management. When the vision is blurry,
there is a lack of commitment and policies are not able to deploy successfully.

2) Customer focus:
Customer focus means a degree to which an organization continually satisfies
customer requirements. Such firms can be expected as a successful firm as it
recognizes the need to put the customer first in every decision made. The most
important thing to quality management is maintaining a closer relationship with the
customer. It helps determine the customer’s taste, colour, and preferences.
Therefore, it is necessary to get the customer closely involved in the product design
and development with valuable input to every stage. The customer allows an
organization to exist; thus, prioritizing customer is one of the major factors of the
framework of Total quality management. Every element should focus on total
customer satisfaction, both internal and external.

3) Employees involvement and participation:

TQM environment or culture needs committed and skilled employees, who all can
fully participate in the activities performed to improve the quality. A company must
encourage all its employees at all levels to take responsibility. You must also boost
them to communicate well toward refining the quality at all production stages. Since
managers and supervisors hire the employees, so they should consider the employees
as intelligent and having effective ideas. The workforce within the company is
considered as internal customers. Thus, they need to be well contented to achieve
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complete satisfaction for its external customers. It is as if they are happy, they will
keep others happy.
4) Training and education:
Training and education in any filed is utmost important in determining the success
of Total quality management. You should consider that empowerment and
involvement is not that effective unless employees receive formal,
systematic quality management course. Education and training programs should
target everyone working in the organization as the quality under the Total quality
management. It is the responsibility of everyone to get involved in such training
programs conducted by the organization. The training programs help employees
from the top management to the labour-force to understand the philosophies of
TQM.
5) Communication:
Communicating in a good way allows that TQM to be more approachable, leading
to reduce one’s fear. Good communication is like cement that holds bricks of the
Total quality management process. Direct communication between employees and
supervisors, face-to-face interaction, and a good feedback system are very
significant in conveying ideas to the management and integrating the essential
change required.
6) Culture:
The culture within a company is nothing but the interaction that takes place between employees
within an organization. A relationship gets created within the employees by their behaviour.
Culture, in other words, can be described as the beliefs which permeate the company regarding the
processes. These processes tell us how to conduct the business, how the employees must behave,
and the way they prefer to be treated. Total quality management culture consists of a co-operative
and open culture, which is needed to be created by the organization management. In TQM culture,
all the employees are made to feel considered; it happens only if they are involved in the
development of the vision, strategies, and plans of the organization. The implementation of TQM
culture is important because employees are unlikely to behave in an acceptable, responsible
manner. It happens in the case where they see the management behaving irresponsibly and saying
something or acting in opposition to it.

Conclusion:
Till now, you must have understood that all the above mentioned are the key factors for a
successful TQM implementation. Leaders should be the first to provide the initiative to apply Total
Quality Management, as well as support quality programs.

REFERENCE:
1. LBTC blog writing, 02 August 2019, ’ 6 ESSENTIAL FACTORS FOR ACHIEVING SUCCESSFUL
TQM IMPLEMENTATION IN A COMPANY.

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