In today’s blog we’ll be discussing the principles of total quality management (TQM), but first, let’s go over what total quality management is and the benefits of implementing this approach.
What is Total Quality Management (TQM)?
Total quality management is a management approach that encourages organizations to continually analyze its production processes to reduce or eliminate errors in manufacturing. What’s more, it focuses on delivering products and services with the highest quality to maximize customer satisfaction and improve the customer experience. In essence, total quality management is an organization-wide effort for continuous improvement. This is because it aims to hold everyone in the production process accountable for the overall quality of the final product or service.
The Benefits of TQM
A goal of total quality management is to create error-free products and services from the start. As a result, this means that products ship with fewer defects, which reduces product recalls, future customer support overhead, and product fixes.
High-quality products that meet and exceed customers’ expectations results in higher customer satisfaction. Higher customer satisfaction, in turn, can result in increased market share, revenue growth (through upsell), and word-of-mouth marketing initiated by customers.
By producing products with less defects, companies reduce costs in customer support, product replacements, field service, and the creation of product fixes. Furthermore, since these cost reductions flow straight through to bottom-line profits without any additional incurred costs, profitability can then increase.
Improved Employee Morale
The ongoing and proven success of total quality management, and especially the participation of employees in that success, can result in noticeable improved employee morale. Consequently, this reduces employee turnover and therefore, reduces the cost of hiring and onboarding new employees.
What are the Principles of Total Quality Management?
There are a number of guiding principles that define total quality management:
1. Customer Focused
One of the most important principles of total quality management is customer focus. The customer is who determines whether or not a product is high quality. Therefore, at the least, an end product must meet the needs and demands of the customer. Moreover, customer feedback is highly valued. This is because it allows a company to better understand the needs and expectations in the manufacturing process. For instance, if customer surveys are collected, there is a possibility that there may be insufficient durability of goods. This feedback is then passed along to the total quality management system to implement better raw material sourcing, manufacturing processes, and quality control procedures.
2. Total Employee Involvement
Another important principle of total quality management is total employee involvement. For total quality management to be successful, all employees must participate in working towards a common goal. That is to say, clear communication to all departments and leaders of what the goals, expectations, needs and constraints of the company are is necessary. Additionally, a company that adopts this management approach must create an environment where their employees will feel empowered. So, there needs to be a willingness to train employees and give them the tools and resources they need to complete tasks successfully and on time.
3. Process Oriented
A fundamental part of total quality management is process thinking. Because total quality management is systematic, it relies heavily on flowcharts, TQM diagrams, visual action plans, and documented workflows. As a result, all employees in a production process must be aware and thoroughly understand what their part in the process is. This is to ensure that the appropriate steps are taken at the right time of production. In short, processes should be analyzed continually to better understand any process inefficiencies
4. Integrate Systems
Regardless of the size or complexity of a company, total quality management believes that all systems should communicate with each other to discuss useful information and make better decisions. By linking data sources and sharing information across systems, total quality management enables everyone to be on the same page, at the same time.
5. Strategic and Systematic Approach
A critical principle of total quality management is the strategic and systematic approach to achieving an organization’s vision, mission, and goals. In other words, total quality management requires a system approach to decision-making that involves a company to focus on integrating quality as its core component. In addition, a company needs to make the appropriate financial investments to make that happen.
6. Improve Continuously
Continuous improvement is a huge aspect of total quality management. This concept helps a company to adapt to changing market demands. It also allows for better adaptability to different products, markets, customers, or regions. What’s more, continuous improvement drives a company to be both analytical and creative in finding ways to gain a competitive advantage and more effective at meeting their customers’ expectations.
7. Fact-based Decision Making
In order to know whether an organization is meeting its objectives or not, performance data and metrics are necessary. Total quality management relies heavily on documentation and planning. As a result, it requires an organization to continuously gather and analyze data to improve decision making accuracy. Examples of data to gather and analyze include sales, profits, and customer retention.
The last principle of total quality management is communication. Effective communication plays a huge part in maintaining morale, motivating employees at all levels, and reducing process errors. Moreover, communication is especially important during normal day-to-day operations and large organizational changes.