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Strengths and Weaknesses in TQM Implementation

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Abstract

TQM is a philosophy practiced by large organizations. Small organizations are still lagging behind when an issue comes to introducing and implementing advanced technologies and new managerial philosophies. Many small organizations have ended at quality system certification, such as ISO 9000, in their quality movements instead of pursuing continuous improvements through TQM. Small organizations should understand the necessity to look beyond a stage of quality system and work to achieve a total quality, with this approach their quality efforts will yield results. This paper examines various obstacles confronting small organizations when implementing TQM, first, considers the subject of TQM and the quality initiatives adopted by small organizations such as ISO 9000 and TQM. The paper also highlights the characteristics of the small organizations. Second, a case study conducted on small business organization culminates with discussion and conclusion and offer suggestions and recommendations for future research in this direction.

Introduction

Many of the large multinational corporations such as IBM, British Airways, Hewlett-Packard, and Motorola are already following TQM into their business. Except very few, many small organizations still lag behind when an issue comes to adopting new techniques of management such as TQM. This paper examines various TQM implementation techniques related to small organizations. The background section highlights TQM concept, and the quality initiatives implemented by small organizations. The majority of studies reveal quality assurance and the adoption of BS EN ISO 9000; very few zeroed on the application of total quality. The project report, a part of this research present a detailed study of one small organization engaged in manufacturing. This study present a detailed analysis of various techniques for effective realization such as process of implementation, management practices, results and outcomes with further suggestions for future research in this filed.

1. Literature Review

TQM in the small business

Researches on TQM adoption in small organizations are rather rare. All literature seems to focus the implementation of TQM in larger organizations because they are more significant than smaller organizations. The most part of the published work focus on the approaches that small organizations have undertaken to pursue TQM implementation. Some of the literature associates to survey results concerning the motive of TQM adoption, measures adopted, and the results of TQM realization on the basis of managers’ perception. A study by Yusof and Aspinwall (2000a) show that those earlier developed frameworks were far from approaching and did not fit into the framework of small organizations. Moreno-Luzon (1993) has come to a conclusion that small enterprises lag behind large in TQM application. Successful small organizations emphasize more on the product and innovative processes, investments into new industrial equipment, and also need to have a highly motivated management with better management skills. They employed less qualified staff than larger ones, and through TQM implementation, were able to train their employees, which led to improvement in all processes of production. Ghobadian and Gallear (1996) focus on the reasons of implementing TQM by small organizations; the key steps involve implementation, the impact resulting from its realization and the obstacles faced in the course of implementation. They have come to a conclusion that small organizations could implement TQM successfully and address TQM with the big success, and they specified that strengths inherent in small organizations were beneficial in terms of TQM application.

Reasons for adopting TQM

Small organizations relied on TQM for several reasons. Shea and Gobeli (1995) observe some motives in a study of small organizations and the reasons are following:

1) Stimulation of growth; it is easier to convince bankers of the company for short and long term loans if the company is performing well.

2) Management realizes the principle of employee empowerment which reflects organizations supporting TQM.

3) Continuous changing needs and expectations of customer even seen as an initiative for these organizations.

4) Organization performance can be enhanced, if it is lacking behind.

5) Making the working environment more cordial.

Even these reasons look heterogeneous, they all specify in the same direction of quality improvement. The profit motive is a fundamental issue especially for all small organizations. They should understand and realize that improvements in their business, and in other aspects, such as working conditions have immense value for survival. Brown (1993) conduected a case study of one small organization, whose reason for implementing TQM was to develop employee empowerment, motivation, a new culture, and also management desire to achieve maximum profitability. Brown (1993) observed that one of the companies struggling to overcome internal problems such as quality related problems, poor delivery performance because of poor financial returns and narrow functional approach were the key reasons for implementing TQM.

2. Strengths and weaknesses in TQM implementation

Small organizations possess certain characteristics relative to larger organizations. Ghobadian and Gallear (1996) have drawn a list of distinctions which exist between large and small organizations on aspects such as behavior, structure, people and processes. Certain characteristics promote TQM implementation while others can restrict it.

In terms of behavior, structure, people and processes, a small organization is in a favorable position when it comes to implementing a new change initiative provided the management has adherence and leadership of the change process, and also possess proper knowledge. Lee and Oakes (1995) gave financial and technical constraints as being prime causes plaguing small organization. Haksever (1996) support this argument with a concept that small organizations face many problems when trying to adopt TQM. They were a lack of business knowledge and experience, and shortage of human and financial resources. These two basic problems can lead to another, such as insufficient training budget that further is a hurdle in TQM implementation. Management leadership is possibly the most influential factor for TQM success, and if small organizations can overcome this hindrance, successful implementation of TQM is possible. Shea and Gobeli (1995) argue that it is easier for small organizations to adopt TQM since the final authority of decision making lies with managers and owner. Haksever (1996) pointed out an aspect favoring small organizations that they are closer to their clients and all stakeholders, thus resulting smoother information flow between the stakeholders and the organization. However, small organizations without customer data collection system will face obstacles, as much of the information will not be available, or only remains in consciousness of the owner and managers. It underlines the necessity of creating a system for deciding the types of data which should be collected, and in which manner actions should be undertaken. The degree of complicatedness of such system should be considered whereby simpler variant than that in large organizations is preferable. Training and education plays a crucial role on the agenda of small organizations in implementing TQM. In a small organization with fewer personnel, it will be easier to train staff, and time needed to impart training at a lower level is much lesser than the large organizations. Small organizations have high potential for success with continuous improvement and employees’ involvement through empowerment, teamwork and participation, provided managers genuinely trusts in value of the employees as an intellectual person. Once this contribution occurs, the result can be seen in a short time, because feedback journey is short in small organizations than in the large organizations (Asher 1992).

3. Case study on TQM implementation in a small organization

Introduction

In order to evaluate the quality initiative of a small organization, a comprehensive study is done on a small organization. A questionnaire (Figure 1) developed and designed in such a manner as to derive maximum information and answer questions with respect to management practices and perceptions of TQM, how TQM implementation can be applied, the adaptation of various quality initiatives, the challenges encountered and also the factors that play a crucial role in a success of TQM implementation.

Background of the study - Small TQM Company

The company studied was Reliable Spring and Manufacture Company Ltd. The company manufactures springs, including tension, compression, wire shaped, pressed and torsion springs. From the two hundred personnel working in the company, twenty four are at management level. The quality control department employees only sixteen persons, which makes about eight percent of total employees’ strength, and is extremely lean as most part of quality inspection process lies on the production department. A series of awards and certifications recognize the company’s effort towards becoming TQM Company and leaders in their trade. They gained ISO 9002 in 1992, received the Ford's Preferred Supplier Award in 1994, the Investors in People (IIP) certification in 1997, and QS 9000 in 2002 (Barrier 1992).

4. Perceptions and practices of TQM

Top management trusts in customer satisfaction through a continuous learning and improving culture. Reliable Spring Limited employs this opinion into efficient management practices such as improving communication, participating in improvement activities, solving problems on the systems, having a clear mission regarding the business, team working at management level, and active participation from managers to bottom workers as the key instrument in continuous learning. Various procedures and systems, including R&D, training, quality measures and management information systems are already in existence, and the management continuously looks after the key business processes such as manufacture, purchasing and supply chain management. Clearly, quality practices of this company correspond to the values of TQM (Brown 1993).

Continuous quality improvement has become possible through continuous learning and implementing of those outcomes in quality control processes. From the point of view of the quality improvement structure, both cross-functioning and within-functioning approaches exist. A training program to support quality improvement is evidence of being an IIP company. One of the key programs conducted in the tension spring department is the Masters Improvement program in cooperation with the Society of Motor Manufacturers and Traders, working on waste reduction, cycle time determination and improvement, lay out improvement and cycle time reduction.

The quality control manager supervises the SMMT project with personnel of quality control cell and tension spring cell leader. The company implements several measures so that their clients receive maximum satisfaction. They also conduct regular surveys, and a formal customer complaint cell processes the complaints and resolves the quality control problems. Various kinds of measures are collected for quality assurance and improvement. Examples include the number of rejected parts per million, quality costs and scrap percentage. This company uses a number of quality tools and techniques for various processes. For example, by using such tools in experiment layout and FMEA, in developing and designing the process, while process capability and control charting studies are implemented in controlling production. Nevertheless, the main accent, apparently, relates to productions since there were no proofs to specify, whether the nonproductive functions, use some of qualitative tools for performance improvement. Participation of suppliers has enormous value on the organization’s total quality (Ghobadian 1996).

Reliable Spring has developed Material Supplier Development program, which has begun in 1998, with the participation of 90 percent of their suppliers. They are focusing on building supplier partnership on similar themes to those which they share with their clients by streamlining quality improvement of their suppliers. A compact supplier quality adherence program is undergoing ranging from supplier assistance, quality audit, supplier evaluation, grading and problems resolving teams. A wealth of efficient management practices promotes the development of human resources; distinguish between TQ and non TQ Company. Numerous healthy competition motivate employees provide job satisfaction and continuous learning prevail in this company. They include systems for promotion, a reward system, suggestion schemes, job rotation through multi-skilling and education and training for employees. This company also promotes several communication methods since adopting TQM include monthly meetings, newsletters, seminars and open door policy (Haksever 1996).

The company also promotes off site sessions for managers to discuss, and decide strategic issues.  From time to time, they also organize separate conferences for customers and suppliers to evaluate their performance and an increased added value in supply chain. The company also celebrates its achievements; an example is their certification of QS 9000.

5. Quality initiatives implementation

As regard to quality initiatives measures adopted by Reliable Spring to date, quality control manager pointed out that almost all questions in the questionnaire holds significant value for the company. Some of them were already in the mission statement of the company such as implementation of QS 9000 and IS 9000. QS 9000 requirements are stricter than ISO and also have strict clauses for continuous improvement. Other measures include supplier process control, supplier development and partnership, bench marketing and self assessment, a quality cost system and advance quality planning tools (Asher 1992).

6. Process of implementation

The key reason for implementing a TQM strategy in Reliable Spring was that the company realized the importance of TQM, for its growth, to improve quality, and customers also demanded it. The quality control manager also pointed out one more motivating factor, positive results that have arisen from carrying out continuous improvement such as a reduction in level of a waste. A consumer demand, as motivator, is quite clear, as they work with the large enterprises which demand their suppliers regularly improve quality. Reliable Spring perfectly understands that constant improvement will lead to improvement of quality in production and services, and also employees’ satisfaction finally leading to customer satisfaction. As a whole, measures undertaken to implement TQM and continuous perfection were team development and support, training and education, developing management systems, coordination with NationalResearchCenter for continuous R&D improvements. In addition, company draws an annual operative plan which establishes the agenda for improvement should be reached in the ensuing year. One such example is QS 9000 certification which the company received one month earlier than the set target date. Some of the remarkable achievements till date are in the area of waste reduction, which include ‘3M” (muri, muda, mura), “5S Activities” and setup time reduction. Besides, the certification route, the strategy developed for adopting TQM in Reliable Spring is a theory of “do yourself”, consulting journals and reference books and by attending seminars. Both the QS 9000 and ISO 9000 were developed within the organization without help of consultants. With respect to TQM ideology, philosophy of Deming influences their approach. The most crucial factor pertaining to TQM implementation in a small organization is the practical approach when considering these quality initiatives. Since the company’s resources are less and modest, both human and financial reduction is necessary. This is back up by staggered training schedules rather than investing in full-scale training programs as offered by large scale organization. They also pointed out that the only quality initiative measures satisfy their objectives such as QS 9000. It is evident that their initiatives focus in the production area, which is an uncommonly notable character. Improvements such as a reduction in the amount of waste, number of defects and setup time all establish their quality management. The benefit on focusing on tangible aspects is that short-term benefits can be attained quickly, and both the management and employees are confident of the feasibility of the process (Lee 1995).

7. Six Sigma Statistics for Quality Management

Six Sigma is a well defined business management strategy that was initially developed by Motorola in 1980. Now many businesses implement principles of Six Sigma due to its numerous advantages. The quality of any process can be rectified by revealing and eliminating the reasons of errors. However, it is not adequate until variability in production processes is minimal (Shea 1995).

Experts conduct quality management through Six Sigma methodology with the use of various applications that grow and support talents in the organization. Any project, within the limits of the organization should follow certain sequence of steps, as well as possess quantified financial targets. The financial goal is to reduce expenses and increase the revenue or profits. A systematically designed Six Sigma production process provides almost 100 % of faultless production. This is the prime benefit of the Six Sigma strategy. The goal is to achieve less than 3.4 DPMO, or in other words 99.9997 % perfect products (Shea 1995).

A defect can be any process output that does not correspond to consumer specifications or leads to an undesirable output. The production processes have salient features, which can be measured, controlled, analyzed and improved. Decisions should be grounded on authentic statistical data instead of guesses and assumptions.

DMAIC is a process within methodology to rectify current business processes, has five basic stages; Define, Measure, Analyze, Improve, and Control. In any production process, it is beneficial to define problems while giving attention to customer requirements and goal of the organization purposes. The main aspects of current processes are measured, and the corresponding data are gathered. The analysis of the collected data by means of tools and statistics will help find a relationship that cause positive or negative effects. At the time of implementation, never forget to consider all key factors in a process, as any cause of defects must be eliminated in full. In such manner, current processes receive maximum optimization and thus making sure that there are no wasted resources. Finally, it should be remembered that the control phase of the DMAIC rectifies deviations from targets that usually leads to undesired defects (Yusof 2000).

Conclusion

This preliminary research has provided guidance to TQM implementation in small organizations. It is evident that small TQM organization possesses a wide spectrum of qualitative initiatives but may not be as broad as in the big organizations. A small organization can be successful in implementing TQM, because it understands the necessity of continuous improvement in all aspects of its business activities, as observed in Reliable Springs Limited. A key to success is implementing appropriate knowledge of TQM. By providing the useful resources for a reward scheme, training purposes, investing in supplier development and value added supply chain management; Reliable Springs commits towards quality improvement. Observance from the ideas and discussions present a total concept of TQM in a small organization, which can be reconsidered on the basis of its environment. Certain obstacles that exist in a small organization may restrict its progress in TQM implementation; such as material knowledge in TQM, financial and technical constraints and insufficient human resource management. The concept of continuous perfection and quality improvement applies to small organizations of any size, but abundance of resources in TQM frameworks for small organizations needs to be defined more reflective of the context and circumstances in which they operate. This study can form a basis for working out an effective and reliable implementation framework for service of small business organizations.

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