Concept of TQM
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The quality paradigm has become an integral part of all businesses in the USA, and also on a global scale. It took a considerable time to recognize a key role of quality management for organizational perfection. Today, all organizations have recognized the significance of a systematic quality approach. The evolution of TQM and the majority of its derivatives can be tracked during the period, when the American quality experts formulated quality management frameworks and patronized their utilization in the Japanese industry. The automobile sector is a vivid example for quality management principles that confirm positive and negative consequences of quality paradigms.
This article focuses on the Japanese automobile manufacturer, "Toyota", and examines the various quality approaches in this automobile sector. As a result, we will conclude that, instead of applying rigid quality framework, continuous and consistent qualitative approach at all levels is required, with employees’ participation in all organizational functions along with a comprehensive approach.
Quality management has evolved today as an important and the irreplaceable building block of business functioning and strategies. Competitive markets call for efficient management control, which can be provided with an effective, quality management system. Upgraded product quality should remain persistent, a focus on the client, and minimum operational expenses by optimizing and modifying quality related programs are the basic components for perfection in today’s business. In global markets, the organizations lacking implementation and integrating quality management will finally lose the competitive advantage. The present quality management systems practiced in the businesses goes back to 1950 when quality contemporaries, such as Deming and Juran, first created the quality paradigm. Quality management development has long term association with the automobile industry. This industry implements various quality approaches to sustain competitive advantage, and many approaches have brought mutual strengthening in Asia and Europe automobile market. Many principles of quality such as origins of TQM, lean management or Just-In-Time Management can be observed as a vivid example of effective total quality principles in Toyota business performance. (Mukherjee 2010)
1. Review of Literature
Deming’s 14 Points as Basis for TQM Quality Frameworks
TQM is more or less rigid quality frameworks than a corporate culture. Companies should dedicate themselves to quality principles consistent with their environment. The accent lies mainly on goal oriented aspects, and while TQM in itself does not define concrete system how to achieve the goal, it measures the satisfaction of clients through continuous learning and improvement with active involvement of all employees (Dahlgaard, & Dahlgaard-Park 2006). The discovery of TQM, by Deming and Juran, further lead to development of Quality peers, such as Feigenbaum, Crosby and Feigenbaum.
This paper examines Deming’s 14 Principles of TQM and illustrates the fundamental values of these founders. The 14 Points for Total Quality Management by Deming provides the groundwork for the development of quality management. Deming (1982) basic ideas appeared in 1950th years in different ways, defining many achievements in quality management in majority quality approaches and forming a foundation for theories and quality movements. Elaborating the archaism of Deming’s quality management, the14 points on quality management highlights the importance of TQM for all those organizations, who wishes to attain superiority in terms of quality. The 14 points present a high-grade quality of philosophy, which extensively covers management strategies and guidance to be implemented by top management. The special place among points is the basic precondition for understanding that quality is purely long-term phenomenon and demands commitment with sufficient resources. Eternal aspiration to quality should be adhered to include constantly changes in quality paradigms. Outstanding, among them, is a serious attention on constantly changing customer expectations and needs, which day-by-day are becoming more sophisticated and demanding.
Quality must be included in the designing process by focusing on initial phases of production life cycle, thereby eliminating the necessity for mass surveillance. It means a decrease in operational expenses during the transition from a responsive to an active mode. Deming underlines the necessity of quality management for quality products production. "Quality at a source" specifies that every worker bears the responsibility for quality at every moment. Devoted quality management should be more vigilant by this quality approach, as they are not always associated with internal issues of production, and thus, never be efficient in determining deficiencies. (Foster 2010)
Cost plays a decisive role in today’s environment of business competitiveness, but Deming underlines that a principle of management focusing exclusively on cost reduction is too short-sighted. On the other hand, a holistic approach, in which quality production is the main driver for increasing satisfaction of clients that finally will lead to steady long-term conditions for business perfection. Implementing this principle particularly to the supplier-buyer relationship, focusing away from a price competition, and approach towards quality strategies will nurture long term relationship between suppliers and buyers, will lead to decrease in quality variability and substantial quality gains.
Applying these strategies as an effective, operational practices demand focus on employees’ empowerment. A well organized compact job training, and also cultivation of the favorable conditions allowing continuous development, is both necessary measures to ensure that employees will be more capable in discharging their duties effectively and efficiently. Simultaneously, improvement of quality demands leadership to impart a feeling of enthusiasm and elevated motivation for all employees, to create a sensation of coordination in achieving an overall quality goal. Feedback has immense value for leadership management, and management will expel destructive fears of changes and increase employee creativity, supporting their commitments. Employees must be entrusted with as much responsibility and autonomy in their working as possible. Predetermined working standards are controversial in productivity when sustaining quality preservation Quos does not exhibit continuous perfection and; hence, there is no appropriate stimulus for workers to go beyond the limits of implemented benchmarks. An ultimate goal in human resource management is to provide a better working environment which generates commitment and employees pride.
During product life cycle, the main principle stated by Deming for improvement of quality is unrestricted communication between all departments. It will lead to a product design in which intra-departmental workforce works in paralel, instead of inferior involvement of product design by only one single department. Hollow slogans and knocking the head of employees, putting undue pressure upon workers, drifts them from company objectives, instead of coordination and motivating them. They are incompatible about constructive feedback and do not to convince workers to be responsible. At last, it can be said that one of the basic ingredient of quality management is that each single worker must be a part of quality management.
2. Concept of TQM
Though the term, TQM came into existence only after revival of the quality movement in the USA in early eighties, its main principle goes back to quality founders, Deming and Juran. The study shows that Deming was the first one to pioneer in quality paradigm in 1940, and later the Japanese companies implemented the concept of quality into their organizations. Deming and Juran theories were popular in Japan long before the U.S. noticed the importance of their contributions, in early eighties. The building blocks of TQM, as in figure 2, are the organization objectives should aspire constantly to improve quality aspects on the way to quality leadership (Deming 1982).
Customer focus and satisfaction is necessary to attain market perfection. Principle of needs and wants serve as guiding tools for all organizations. The global competition will not permit organization survivals if it is not customer focused. The customer and supplier relationship, as the interface in the subsequent process, is the long term relationship, involving mutual participation, which follows the needs to satisfy the client. Measurement is the essential precondition for improvement in TQM. The value of each process should be measurable, and measurements should be carried out regularly. The generated surplus during the process can be measured, by comparing the cost of the production before and after the end of the process. This principle of Toyota TQM motto says, “Do correctly from the first”. Cost increases by some values, the defects found later are corrected in a technological chain. This awareness tries to reduce to a minimum wastage of resources which works out well with stress on prevention. Recurrence of errors is not comprehensible, and quality will only persist if the root of problems is traced and eliminated (Regassa 2007).
The building blocks consisting of seven zeros, as in the figure, concerns to the seven mudas, a Japanese term, meaning a waste descended from the Toyota production system. For Total Quality Management, muda or waste should be removed at several stages: negative opinion relates to the whole culture of the company, achieving zero delays and removal of excessive inventory are necessary for improving organizational processes. The goals emphasize on zero defects, zero accidents and zero downtime. Involving all participants is a constant theme in the quality management of Toyota, which penetrates in all systems of quality. The satisfaction of all parties, at the same time, concerns expectations to surpass in every respect, the expectations of clients, workers, suppliers, and with stakeholders including the society as a whole. The list shows below shining principles of Toyota TQM:
1. Toyota’s mission clearly defines its vision and a goal.
2. Its quality paradigm is customer focused.
3. The employees are valuable assets and a driving force for its success.
4. The organization processes of Toyota involve constant improvement of quality.
5. Tools, as well as techniques, should be accessible to employees for continuous improvement.
6. Implementing benchmarking as the tool for quality improvement.
7. Customer market evaluation tool should be a key tool for customer driven approach.
Explaining the importance of people, processes and systems of quality initiatives implementation, which are building blocks of TQM, figure 3 shows people, management systems, processes and productivity measurement. The responsibility of applying process quality rests on people who will be successive determinants. People apply these processes by zeroing on quality, incorporating improvement activities with recognition from the management; the prerequisite environment facilitates the successful implementation of Quality Management Systems. Performance measures for monitoring and control of the quality standards will support quality strategy, after determining the organization’s quality progress (Regassa 2007).
3. TQM Facing the Challenges of Operational Excellence
The effect of TQM on organization excellence, business value and product innovation has always been a disputable theme among researchers, and several studies have shown the interrelation of quality on business results. In 1995, Powell studied an overall review of researches on TQM and its influence on business performance. In research, he came to a conclusion that there is no obvious correlation between pure applications of TQM and enhanced operational performance. TQM has potential for productivity increase, but not an independent selling point. Powell recommends that, for operational perfection, organizations should concentrate on creating the corporate culture on the basis of quality principles, instead of intimating TQM methodology.
An empirical research by Liang-Hung, & Iuan-Yuan (2006) reveals the influence of product quality on innovative production at various automobile manufacturers in Europe and Asia. Research has defined close interrelation between production quality and effective potential of innovations of automobile manufacturers. When implementing the given patents as an indicator of innovative production, and also a problem for 100 cars (PP100) metric as a quality indicator, figure 4 shows linear regression. The plot shows linearity of regression equivalence of all systems of quality, as product quality usually occurs by various approaches of quality systems. Moreover, the research does not make the hypothesis about the character of system in quality, such as Six Sigma, Total Quality Management is the observance of the quality standards, such as ISO 9001. Thus, the result testifies the necessity for one system of quality, if auto manufacturer aims to lead at innovations.
4. The Toyota Quality Approach
Toyota implemented principles and the philosophy of TQM in the early fifties. Toyota achieved excellence in many quality production principles, such as Lean Management and Just-In-Time, which are essential principles of any production system in all industrial sectors worldwide. Toyota succeeded to convince critics with the persistence of its long-term strategy, finally gained the competitive edge over the majority of its contemporraries and proved the most profitable automobile manufacturers in the world within few decades.
To evaluate the approach of Toyota towards Lean Production, Toyota production system demands entirely new perspective on quality concepts and production systems. It is not enough to learn fast tools and methods. In order to achieve results, all stakeholders in the company from the manager to the bottom worker engaged in production should understand the philosophy. Total production system is a culture, instead of a set of techniques and tools. Many companies implement the tools and quality approaches developed by Toyota, for example, Kanban implemented these tools for managing a stream in production of materials, Andon is a control technique in manufacture, allowing workers to stop manufacture in case defects occurs. Continuous perfection in the production system and focusing on main developers demand active participation and interaction by all participants. The system needs a perfect planning to achieve total perfection. It allows workers to participate by underlying necessary rewards, training and education. The lean tool of 5S (stabilize, sort, shine, sustain and standardize) is a vivid example of philosophy of Toyota in which “sustain" supports the long-term coordination of all actions (Regassa 2007).
The fourteen principles of the Toyota, present an executive summary, characterize its specificity and shine the cultural approach. The principles stand on four main pillars for sustaining the system; determine long term strategy, value creation by empowering the employee, continuously solving root problems and goal orientation of TPS tools:
Principle1. Management decisions must be based on a long-term philosophy, even at cost of short term financial gains.
Principle 2. Create a continuous flow of the production process, so as to bring problems on a surface.
Principle 3. Implement "pull" systems to refrain from overproduction.
Principle 4. Level your workload, work like a turtle instead of a hare.
Principle 5. Create a culture of stopping to solve problems, quality rights from the beginning are necessary.
Principle 6. Standardized processes and tasks are the basis for constant perfection and expansion of the rights and opportunities for employees.
Principle 7. Use visual control so none of problems can escape.
Principle 8. Use only reliable technology, beneficial for the people and processes.
Principle 9. Grow leaders within the organization who thoroughly understand the work and teach others.
Principle 10. Develop talented people and teams who believe in company’s philosophy.
Principle 11. Respect partners and suppliers by helping them to improve.
Principle 12. Go and look carefully to understand a situation.
Principle 13. Decision making should be done slowly on the basis of a consensus, considering all opinions and then implementing them quickly.
Principle 14. Become, an example organization, for other organizations by reflecting continuous improvement and achievements.
Several researches have shown remarkable quality improvements in Toyota performance. The majority of them specified many Toyota’s principles rendering influence on production quality and also satisfaction of the clients. Regassa and Ahmadian (2007) allocated employment empowerment and adherence of management as two outstanding basic catalysts for maintaining a competitive advantage over its contemporaries in the USA.
5. Six Sigma A Quality Approach
Six Sigma is a disciplined process which initiates to focus on development and delivery of almost perfect products and services. This definition of Six Sigma developed by its promoters, General Electric, illustrates the total philosophy behind it. In reply to increase of awareness of the USA industry, caused by the Japanese superiority of quality over the American industry, quality moved to the center of all business strategies. The book Quality is Free by Philip Crosby opened a new chapter of the development process, listing 14 step approaches for improvement of quality with an ultimate goal of zero defects. Motorola implemented this idea in the end of eighties and modified by creating a concept of Six Sigma. Motorola developed this Six Sigma as set of the statistical methods, based on principles of product specifications and process capability, which later turned into the statistical concepts of defects on one million opportunities aim for revealing inefficiency in product development process. Six Sigma permits six deviations between the specification limit and the process means. General Electric had gone further away to establish Six Sigma as a mandatory culture into its production process. The conceptualization of constant quality improvement zeroed on eliminating defects in designing and production and refined with the basic principle of define, measure, analyze, improve, and control. The concept of Six Sigma provided an efficient approach to quality management with known success stories of GE and Motorola, which both asserted the process efficiency and improvement of quality sharply. Six Sigma was later implemented in all automobile sectors, with Toyota as most vivid example. Toyota, which already had experienced TQM approaches, gained an advantage from Six Sigma after the company experienced issues concerning quality management approaches (Dahlgaard 2006).
This research has revealed the adoption of a sustainable, and a consistent quality approach is a basis for process improvements, especially in Toyota. This article has further highlighted a wide spectrum of various quality approaches implemented by the automobile industry, recommending the applicability of all theoretical quality frameworks. The examples of Toyota exhibits, the different techniques for achieving the quality goals are of lesser importance than comprehensive philosophy and culture of the company which guarantees management participation and promotes adherence of all employees. Quality frameworks at all levels, with participation of all employees with the comprehensive approach, and focusing on sustainability and product quality process, were the main factors which supported Toyota to attain operational perfection.
If, on the other hand, Toyota management have adopted rigid quality frameworks, then this could be considered as a pure tool, lacking in participation and practices for delegating the authority to employees and other process adjustments. The companies implementing this technique have shown the worse results than earlier or lost the improvement opportunities in business soon after the implementation of processes.