Definition
Total Quality Management (TQM) is an approach to managing organizations that emphasizes the importance of improving the quality of products and services to meet or exceed customer expectations. TQM involves the continuous refinement of processes through inclusive, employee participation and a focus on continuous improvement.
Examples
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Manufacturing Industry: A car manufacturer implements TQM by setting up a quality control unit that regularly checks the parts used in production. By systematically improving the parts’ quality through feedback loops and rigorous testing, the firm reduces the rate of defects and customer returns.
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Service Sector: A hotel chain employs TQM by continually training their staff on best service practices and gathering guest feedback to make improvements in service delivery. This approach leads to higher customer satisfaction and increased loyalty.
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Healthcare Providers: Hospitals use TQM techniques to streamline their patient care processes, reducing waiting times and improving the accuracy of diagnoses. Continuous feedback from both patients and staff helps to refine these processes further.
Frequently Asked Questions (FAQs)
What are the main principles of TQM?
The main principles of TQM are:
- Customer Focus
- Commitment by Management
- Employee Involvement
- Process Approach
- Integrated System
- Strategic and Systematic Approach
- Continual Improvement
- Fact-based Decision Making
- Communications
How does TQM benefit an organization?
TQM benefits organizations by:
- Reducing waste and inefficiencies
- Improving product and service quality
- Increasing customer satisfaction and loyalty
- Enhancing employee morale and involvement
- Encouraging continuous improvement in all areas of operation
What is the role of employee empowerment in TQM?
Employee empowerment in TQM involves giving employees the authority, resources, and skills to identify and solve quality problems. This leads to increased job satisfaction, higher morale, and a proactive attitude towards continuous improvement.
How is TQM different from traditional management practices?
TQM differs from traditional management practices in its emphasis on quality in every aspect of the business process, its customer-centric approach, proactive problem solving, and perpetual process improvement, as opposed to periodic reviews and reactive improvement.
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Kaizen Costing: A cost reduction approach that involves continuous, incremental improvements to existing processes and systems.
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Continuous Improvement: An ongoing effort to improve products, services, or processes.
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Employee Empowerment: Providing employees with the authority and responsibility to make decisions regarding their work activities.
Online References
Suggested Books for Further Studies
- “Total Quality Management: Key Concepts and Case Studies” by D.R. Kiran
- “Out of the Crisis” by W. Edwards Deming
- “Total Quality Management” by Besterfield, Dale H.
- “The Toyota Way: 14 Management Principles from the World’s Greatest Manufacturer” by Jeffrey K. Liker
Accounting Basics: “Total Quality Management (TQM)” Fundamentals Quiz
### What is the primary goal of Total Quality Management (TQM)?
- [ ] To reduce employee numbers
- [x] To improve the quality of products/services and meet/exceed customer expectations
- [ ] To increase the number of product lines
- [ ] To reduce the cost of raw materials
> **Explanation:** The primary goal of TQM is to improve the quality of products or services to meet or exceed customer expectations through continuous improvement and a focus on customer satisfaction.
### Which of the following is a key principle of TQM?
- [ ] Profits maximization
- [ ] Single-department enhancement
- [x] Continuous improvement
- [ ] Short-term goals
> **Explanation:** One of the key principles of TQM is continuous improvement, which involves ongoing efforts to enhance processes, products, and services.
### What is employee empowerment in the context of TQM?
- [ ] Delegating all decisions to top management
- [ ] Restricting employees' roles and responsibilities
- [x] Providing employees with the authority and tools to identify and solve problems
- [ ] Limiting employee involvement in process changes
> **Explanation:** Employee empowerment in TQM means providing employees with the authority, resources, and skills they need to identify and solve quality issues.
###Which sector may benefit from TQM practices?
- [x] Manufacturing, service, and healthcare sectors
- [ ] Only the manufacturing sector
- [ ] Only the service sector
- [ ] Only the healthcare sector
> **Explanation:** While TQM originated in manufacturing, its principles are applicable and beneficial across various sectors, including service and healthcare.
### A hotel chain implements TQM by:
- [ ] Reducing the number of rooms
- [x] Training staff and gathering guest feedback to improve service
- [ ] Increasing room rates
- [ ] Standardizing menu offerings
> **Explanation:** A hotel chain can use TQM by continuously training their staff and incorporating guest feedback to make improvements, leading to increased customer satisfaction.
### How does TQM differ from traditional management practices?
- [ ] TQM only focuses on product quantity
- [x] TQM emphasizes quality in every aspect and continuous improvement
- [ ] Traditional management practices require less effort
- [ ] TQM eliminates the need for any management oversight
> **Explanation:** TQM differs from traditional management practices by focusing on quality in all aspects of the business process, adopting a customer-centric approach, and emphasizing continuous improvement rather than periodic reviews.
### Which method is NOT associated with TQM?
- [ ] Kaizen
- [ ] Six Sigma
- [ ] Total Employee Involvement
- [x] Randomized Quality Checks
> **Explanation:** TQM methods like Kaizen, Six Sigma, and total employee involvement focus on systematic and continuous improvements, while randomized quality checks are not part of a structured, ongoing process improvement approach.
### What is 'Kaizen' in the context of TQM?
- [ ] Large scale operational change
- [ ] Cost-cutting without quality consideration
- [x] Continuous, incremental improvement
- [ ] Temporary fix to quality issues
> **Explanation:** In the context of TQM, 'Kaizen' refers to continuous, incremental improvement in processes and systems.
### Which of these benefits directly stems from using TQM?
- [x] Increased customer satisfaction
- [ ] Decreased product variety
- [ ] Increased stock prices overnight
- [ ] Reduction in market competition
> **Explanation:** TQM aims to improve product and service quality, which leads directly to increased customer satisfaction.
### TQM primarily reduces inefficiencies and what else?
- [ ] Stock market volatility
- [ ] Employee salaries
- [x] Waste
- [ ] Global trade restrictions
> **Explanation:** TQM reduces inefficiencies and waste, leading to better use of resources and improved operational processes.
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