From Good to Great: What is Total Quality Management (TQM)?

Suppose you are in the business landscape and are determined to have your business be successful and simultaneously provide ultimate customer satisfaction. 

In that case, you need to know what total quality management is. 

In this article, you will learn everything about total quality management and how it can be helpful for you and your business. 

Let’s start now!

Introduction to Total Quality Management (TQM): Definition and Background

Total quality management, or TQM, focuses on the systematic and structured approach to overall organizational management. The focus of TQM processes is to improve the quality of an organization or business’s outputs, including the services and goods, through continuous improvement of internal practices for each core component. 

But what is the background of total quality management? 

The origins of the phrase total quality management is unknown, but it all started when Walter A. Shewhart introduced “modern quality control.” He wrote a book entitled “Economic Control of Quality of Manufactured Products” in 1931.

Decades later, Joseph M. Juran further developed Shewhart’s work. Then, in the 1950s, the TQM framework was created by William Deming, a management consultant whose work contributed to Japanese manufacturing.

In more defined terms, TQM focuses on productivity and the effort to improve quality. It examines the guidelines and strategies businesses use to extinguish manufacturing errors (important in the manufacturing sector), improve customer experience, streamline supply chain management, and ensure that employees in the organization are well-trained. 

Total quality management is among the key concepts in any business growth strategy, whether a service company or a big corporation. It is a strategic and systematic approach encompassing all factors of an organization. It aims to hold all the people involved in the production process accountable for the overall quality of the product or service.

The Core Principles of TQM

Every organization or business has its management techniques and methods, business processes, and strategic planning. Depending on them, success varies from one company to another. 

Below, we will explore the core total quality management principles, regardless of the variables of the business endeavor. 

Customer focus and satisfaction

Customer focus and satisfaction is one of the core TQM principles. It puts the emphasis on the customers buying your products or services. 

On deeper meaning, it refers to paying attention to improving customer satisfaction and customer retention. Customer loyalty is really important to achieve success for your organization.

Continuous improvement and Kaizen

With continuous effort, there would be continual improvement. 

Kaizen hails from Japanese with Kai (improvement) and Zen (good) combined; it translates to “continuous improvement.” 

This core principle of TQM refers to activities that continuously improve all functions of the organization and involve all employees from all organizational departments and department levels. This includes everyone from CEOs to assembly line workers.

When the continual efforts are done right, there will be better processes that lead to improving quality and creating a humanized workplace.

Employee empowerment and Involvement

If you want to see continuous improvement in processes, you’ll need the total commitment of your employees. Total employee commitment can increase productivity, sales, and operations in cross-functional teams. 

To implement this principle of communication, active management participation, acknowledgment of success, and encouragement to your employees are essential. Make sure that you provide constant transparent updates on the development of the organization so all employees are on the same page.

Process excellence and waste reduction

Total quality management’s systematic approach always relies on process flowcharts. Process excellence continually improves business processes, manufacturing processes, and operations’ effectiveness, efficiency, and quality through a strategic management framework. 

You need to take care of items that hinder operations like immediate process issues and quality-related issues in order to eliminate waste that can affect production, performance, and quality. Waste, in this matter, is defined as any actions that do not add any value to the process or the customers.

No management approach guarantees long-term success, but the best TQM practices could lead to quality improvement and continual progress.

Fact-based decision making

Total Quality Management places a very strong emphasis on informed decision making by recognizing the pivotal role of empirical data and facts in dictating organizational strategies. This approach ensures that new processes are not only implemented but continuously refined based on data-driven insights. 

A commitment to such a way of thinking enhances the overall quality of decisions, contributes to increased productivity, and allows the organization to remain competitive.

Access to this data should be available to all relevant teams, steering committees, and stakeholders. This fosters a transparent and collaborative environment, where everyone has the liberty to contribute by evaluating past performance.

Integrated systems

When it comes to total quality management, integrated systems are incredibly important for fostering cohesion in the organization. 

When a business is split into different departments, it’s often difficult to cater to interdependencies and function in parallel. Because departments often work in silos, a TQM approach advocates for interconnectedness via horizontal processes.

A defined infrastructure ensures that everyone is properly trained to have a shared understanding of processes, quality standards, and KPIs. In many cases, this leads to improved organizational performance and helps all departments achieve excellence. 

Not to mention the time saved from unnecessary back-and-forths or duplicate deliverables due to miscommunication.

Systematic and strategic approach

Every business should have a clear long-term vision and mission. Therefore, each design decision, actionable item, and process should be imbued with the company’s ethos. 

Usually, this means having a long-term strategy plan and calendar, or a detailed business plan that dictates the organization’s approach in every aspect in the foreseeable future.

Total quality management encourages businesses to align every aspect of a business with its long-term vision and go beyond its immediate goals, adopting a forward-thinking mindset.

This is an engine for better employee involvement and a stronger sense of job satisfaction since team members can feel like they’re part of something bigger. On the other hand, long-term thinking impacts the brand and bolsters customer loyalty.

Effective communication

Total quality management puts effective communication first, recognizing it as a cornerstone for success and total employee involvement. Clear and transparent communication channels help team members understand their role in contributing to broader objectives. A shared understanding fosters a work environment where people feel connected to the organization’s values, mission, and goals.

Effective communication is a two-way street. While managers should communicate their expectations and tasks clearly, they should be open to considering new ideas that could help improve the business. 

Proper TQM implementation not only creates an avenue for generating new ideas but also helps employees feel recognized and heard.

TQM Tools and Techniques

To solve almost any kind of problem that arises in an organization, quality management systems, tools, and techniques are created to help you eliminate those problems. 

Here are some of the TQM strategies and tools that you can use.

Quality control charts 

To achieve total quality control, there are seven basic tools that you must familiarize yourself with.

These tools were introduced by Dr. Kaoru Ishikawa in 1968: 

• Check sheet; 
• Graphs (Trend Analysis); 
• Histograms; 
• Pareto charts; 
• Scatter diagrams; 
• Cause and effect diagrams; 
• Control charts.

It is very essential to apply these statistical quality control (SQC) tools when troubleshooting issues within the production processes in the organization. 

Statistical process control (SPC) methods

Statistical process control method refers to using statistical techniques to control a production or process method. 

SPC tools can help you monitor the behavior of the process, identify internal system issues, and create solutions for production errors. 

Quality function deployment (QFD)

Quality function deployment, or QFD, is a TQM tool that provides a graphical methodology for digging up customer expectations and customer demands.

It is used to make decisions in case the needs and expectations conflict with each other. Its other aim is to drive customer-focused expectations and requirements into product development and manufacturing.

Six Sigma methodology

Six Sigma methodology gives you the tools and techniques to identify what’s slowing the production process. It shows you how to improve the process, eliminate delays, and fix issues. 

The Six Sigma aims to reduce the variability, time, and defects experienced in processes in your organization. Six Sigma also increases customer loyalty toward your product.

These tools and techniques are essential in the TQM framework. This arsenal embodies a widely agreed upon approach to reaching operational excellence and meeting customer needs. 

Implementing TQM: Processes and Best Practices

Implementing total quality management is a strategic undertaking, requiring a systematic approach. To successfully integrate TQM processes into your organization, follow the steps described below.

Establish core values

Start with the fundamentals. Define exactly what drives your business by creating a mission statement that encapsulates the organization’s purpose. Then, craft a vision that outlines the desired future outcome and create goals that align with these guiding principles. 

All of these factors combined reflect your core values which will be a direct influence on your process thinking and the way you implement TQM practices and value into your products and services.

Your mission, visions, goals, and values need to be communicated to the entire organization to indicate a direction and purpose.

Measure success

To understand the effectiveness of TQM implementation, you must establish metrics. To do so, identify specific KPIs relevant to TQM objectives. 

These may include:

• Defect rates;
• Customer feedback scores;
• Employee retention rates;
• Other metrics that directly reflect the efficiency and quality of established processes.

This allows for continuous learning and the ability to later improve upon empirical data.

Identify your target market and seek feedback

In order to solicit valuable feedback, you must first know your market. 

Get to know your audience and gauge them in conversation – be it through surveys, focus groups, or interviews. Analyze customer input to identify trends and make informed decisions to improve your business model or products. 

Make sure to also explore online forums. The indirect voice of your target customer determines a lot since it can be studied in a natural environment and unprovoked environment.

Develop a strategic plan and a comprehensive business strategy

A fully fleshed-out business strategy for the foreseeable future is a must-have for any organization that wishes to find sustained and exponential success. This means outlining the steps, resources, and timelines necessary to achieve TQM goals. 

Such a road-map can be referenced as a roadmap for implementing complex TQM strategies involving the implementation of new quality management strategies, relationship management approaches, employee training programs, and other initiatives.

The role of the top management system is crucial in the implementation of TQM in the entire organization. The reason is that they are the ones who will make sound and strategic decisions that could help the organization achieve its goals, missions, and objectives. 

Measuring and Monitoring Quality: How to evaluate your success

When measuring success, many companies use internal tools to assess the efficiency, quality, and reliability of their services or products. Measuring the quality of operations and products can help an organization to improve continuously. 

Here are some tools you can use to measure and monitor quality within the organization.

Key performance indicators (KPIs) for quality

In terms of quality assurance, one of the best tools to use to ensure the quality of the organization is the Key performance indicator or KPI. Any particular business, but not all, uses KPIs to ensure that the organization is delivering quality. 

KPIs are business performance data metrics; in the case of Quality KPIs, the metrics are related to quality issues. 

Here are the quality KPIs that you can choose and focus on: 

• Risk: Risk KPIs in quality management involve identifying, assessing, and mitigating potential risks that could impact the quality of output. Evaluate factors such as supplier reliability, process vulnerabilities, and external threats. Monitoring risk helps you address issues before they escalate and ensure a robust system for maintaining quality.
   
• Cost of quality: This metric addresses the cost of preventing defects compared to their actual occurrence, which grants insights into the efficiency of the quality management processes that are set in place.
   
• Quality response: Quality response KPIs are concerned with the effectiveness and timeliness of a business’s response to quality-related issues. Usual indicators are the speed and efficiency of the organization’s ability to identify, investigate, and resolve issues.
  
• Quality culture: Ensuring product quality is not just the responsibility of the quality control team – it should be ingrained into the company culture. Naturally though, measuring an abstract concept such as culture is not an easy task. However, observing employee attitudes, their commitment to quality, and adherence to rules and standards are all very insightful practices. A strong quality culture fosters continuous improvement in both production and employee retention.
  
• Productivity: As opposed to culture, productivity is especially quantifiable and relies on a multitude of indicators – speed, resource utilization, ratio of defective products, etc. A balance between output quantity and quality guarantees that demand is met while maintaining a competitive advantage in terms of quality.

These quality KPIs offer the necessary framework for businesses to assess, enhance, and maintain the quality of their processes and output. Make sure to analyze them and use newly found insights proactively to address potential issues and risks.

Quality audits and assessments

Quality audits and assessments are independent and systematic examinations of an organization’s quality management system (QMS). 

The quality audit has two factors:

• Quality system audit: analysis of the internal system which the products are being brought into;
• Service quality audit: analysis of the item or service itself.

Quality audit is typically conducted by an external or internal quality auditor or team at agreed schedules or time intervals, ensuring that the business or organization has a defined system suitable for quality monitoring.

Customer satisfaction surveys and feedback analysis

Collecting customer feedback or surveys is 50% of the job; what makes it 100% is the complete feedback analysis. Customer input and feedback analysis look into quantitative and qualitative feedback data and create actionable and valuable interpretations and insights. 

One of the best solutions is to provide on-demand products whenever the customer satisfaction is half met. 

The customers are your decision-making unit (DMU); they are the ones that pour profit into your business, so you have to let them have decision-making accuracy.

Analyzing customer feedback improves customer experience and creates customer retention.

Benchmarking and comparative analysis

Benchmarking and comparative analysis are the two best tools for business control and so-called strategic planning. 

In quality planning, benchmarking is essential because it compares your business practices, services, products, or results with other organizations that are best in their niche or leading the industry. 

Comparative analysis is the process of analyzing your competitor’s SWOT (strengths, weaknesses, opportunities, and threats) compared to yours. 

Total Quality Management oversees all organizational management, activities, and tasks integral to maintaining a desirable level of excellence in your business and its operations. 

That is why if you have a business or are starting your own business, you should implement TQM as one of your business processes.

Benefits and Business Impact of TQM

Integrating quality in your organizational culture means that Total quality management is undeniably the best tool for organizational advancement. 

Here are some of the benefits that Total Quality Management (TQM) possesses:

• It integrates quality and creates an integrated system.
• It produces a high productivity rate.
• Strengthens competitive position in the market, enabling you to adapt quickly to changes in the market.
• It helps eliminate waste and errors, reduces cost, and allows better cost management and higher profitability assurance.
• It increases job security and boosts employee morale.
• It’s improving processes and increases customer loyalty and retention.

The impact that TQM possesses is unimaginable when done and implemented correctly. It would also help enhance your shareholder and stockholder value, giving your brand more awareness to the public and the business landscape. 

Total quality management may have originated in manufacturing, but any business can use its principles.