Performance Management Total Quality Management Term Paper

  • Length: 8 pages
  • Subject: Business - Management
  • Type: Term Paper
  • Paper: #2851150

Excerpt from Term Paper :

In addition, the system-based reasons of functioning are the duties of management to rectify. No quantity of concern or talent in workmanship can conquer fundamental errors in the system. TQM proponents have been swift to censure performance assessment methods which are based on the supposition that the individual employee is chiefly in control of his or her own performance level. (Designing Performance Management Systems for Total Quality Implementation)

Hence Deming would assert that a mean performance level merely reveals a system's complete ability. Differences on that performance level within plus or minus three standard variations are system-based and haphazard in nature. It follows that a second primary theme of total quality to attain a stable process is that first recognizing and removing the special reasons of variation can only enhance a process. Then centering the concentration on the general, system-based factors that affect performance can enhance the whole system. One of Deming's main worry is that management, through mechanisms like performance assessment, tries to react to most differences as if it were due to special reasons rather than general reasons. (Designing Performance Management Systems for Total Quality Implementation)

Performance measurements in TQM organizations recommend that it must be broadened to incorporate ideas like TQM Performance assessment, the measurement of team performance, information technology challenge, clients-suppliers contentment and association, and incentive and acknowledgment. (Performance Measures: The Link with Organizational Strategy) the functioning of 108 firms were studied by Easton and Jarrell that appear to have made an earnest and victorious attempt to put into operation TQM in the most of their businesses. They calculated performance starting at the probable time when firms in their test started sincere attempts to apply TQM. They discovered that these organizations excelled a sample of standard firms by an average of 16.05% at the end of year five with the majority of the improvements taking place in years four and five. The National Institute of Standards and Technology, which gave out the Baldrige award, evaluated the functioning of widely traded Baldrige award winners against the S&P 500. The report found that throughout December 1, 1998, the publicly trade Baldrige award winners from 1988 to 1997 excelled the S&P 500 by 2.6 to 1. (the Financial Justification of TQM) study by Wm. Schiemann and Associates done in 1996 conducted a national survey of a section of executives concluded that measurement-managed companies, particularly those that measured employee performance excelled those that downplayed measurement. 122 organizations that were making $27 million to $50 billion is sales were studied for the research. A higher percentage of measurement-managed companies were recognized as industry masters, as monetarily in the top third of their industry, and as effectively organizing their change efforts. This last part means that measurement-managed companies are likely to predict the future and are liable to continue in a leadership position in a quickly varying atmosphere. The research studied performance in six tactical performance sections considered vital for enduring victory: Financial performance, Operating efficiency, Customer satisfaction, and employee performance, Innovation/Change, Community/Environment. It was discovered from the result that employee measurement is the major measurement area sorting victorious from less victorious organization. The study says that thriving industry leaders merely do a superior work than non-leaders at calculating their labor force and this is where real change is succeeded or misplaced. (Performance Management: Impacts and Trends)

As per the study, there are four methods that donate to the achievement of measurement-managed companies: Study data point strongly to four mechanisms that contribute to the success of measurement-managed companies: Co-operation on strategy: Ninety-three percent of the measurement-managed firms accounted agreement amongst top management on tactics, against only 37% of the non-measurement-managed organizations. Clarity of communication: good quality contact demands an understandable note, and measurement offers a familiar language for communication. Concentration and alignment of efforts: Measurement-managed companies accounted more often that unit performance measures were connected to strategic company measures and that personal performance measures were connected to unit measures. Culture of the Organization: when evaluated with non-measurement-managed organizations, measurement-managed companies more often accounted well-built cultural elements, such as teamwork and collaboration among the management team, a greater level of employees self-observing their own feat, and a better eagerness to take chance. (Performance Management: Impacts and Trends)

In conclusion, performance measurement is an essential building block of TQM and a total quality organization. Performance measurement plays a vital role in the sequence of infinite improvement in: Recognizing and paving the way for development against organizational objectives; Recognizing prospects for enhancement and Contrasting performance against both internal and external standards. (Measurement: (www.dti.gov.uk/)Every type of performance measurement systems based on Total Quality Management should give obvious connections between PM, benchmarking, and quality costing. In TQM organizations, PM has been employed in the same manner by both manufacturers and services but with one difference, that is, for continuous improvement and benchmarking PM is employed more by manufacturers than service organizations. The dissimilarities between service and manufacturers are more obvious in non-TQM organizations. Manufacturers employ measurement at the company and procedural/technical levels and benchmarking more than services. Non-TQM services employ measurement more than manufacturers for performance management, objective alignment, continuous improvement, and prospect recognition. TQM manufacturers mainly employ measurement more extensively for measuring process and personal performance, objective alignment, continuous improvement, benchmarking and prospect recognition. (Validation of a Model of Total Quality Management Performance Measurement Systems in the UK)

Both TQM and non-TQM manufacturers employ measurement in the same way for evaluating company performance on the whole and team performance. TQM service employs measurement more extensively than non-TQM services for evaluating complete company and procedural/technical performance and benchmarking, but likewise for the further likely applications. Compared to non-TQM organizations, TQM organizations employ PM in performance appraisal, performance management, and relating people and procedures more extensively. With regard to team management, incentive and acknowledgment, both TQM and non-TQM organizations employ PM in comparable extents. Manufacturers and service employ PM for all methods in comparable extents. TQM manufacturers employ PM for all uses more extensively than non-TQM manufacturers; anticipate for incentive and acknowledgment, which is more regular at non-TQM manufacturers. TQM services employ PM more often for all uses barring team management, for which PM is employed more often by non-TQM services. (Validation of a Model of Total Quality Management Performance Measurement Systems in the UK)

The general deductions at the procedural/technical level are that TQM organizations are more probable to deal with and evaluate process performance, and employ a broader array of measures of performance than non-TQM organizations. There seems to be some measurement of suppleness, novelty and time related performance, quality, delivery and customer contentment continue to be the most extensively used performance measures. It is probable for non-TQM organizations to build up efficient PM systems. The kind of PM systems at TQM organizations is unlike that in non-TQM organizations. Also, it seems that TQM organizations are more inventive and elastic, and more probable to build up a genuinely efficient PM system than non-TQM organizations. Specifically, the necessity to combine planned goals, customer needs, process capability and personal participation is perceived as essential for successful PM systems based on Total Quality Management. (Validation of a Model of Total Quality Management Performance Measurement Systems in the UK)

References

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Chapman, O' Mara; Karayan, Hyland. (1998) Performance Measures: The Link with Organizational Strategy. Fall. Retrieved from www.csupomona.edu/~jis/1998/omara.pdf[Accessed 11 December, 2004]

Daniel, Meade. The Art and Science of Measurement: The Nature of Indicators on the Balanced Scorecard. Retrieved at http://www.bettermanagement.com/library/library.aspx?libraryid=10970&pagenumber=1[Accessed 11 December, 2004]

Measurement. Retrieved at http://www.dti.gov.uk/quality/pdfs/sections/Performance.pdf[Accessed 11 December, 2004]

Performance Management: Impacts and Trends. Retrieved from Retrieved at http://www.exinfm.com/pdffiles/pm.pdf[Accessed 11 December, 2004]

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Pun, K.F; Lau, C.W. (2003) Integration of total quality management and performance measurement in government departments: an empirical study in Hong Kong. International Journal of Business Performance Management. Volume: 5; No: 4; pp: 316-335. Retrieved from https://www.inderscience.com/search/index.php?action=record&rec_id=3815&prevQuery=&ps=10&m=or[Accessed 11 December, 2004]

Quality Performance Measurements of the EPC Process: Current Practices. Retrieved at http://construction-institute.org/services/catalog/more/sd79_more.cfm[Accessed 11 December, 2004]

Sinclair, Hsin; Chang, Dave a. (2002) Validation of a Model of Total Quality Management Performance Measurement Systems in the UK. May. Retrieved from www.management.ncku.edu.tw/apmr/doc/apmr-journal/7-3-5.doc [Accessed 11 December, 2004]

Singhal, Vinod; Hendricks, Kevin. (1999) the Financial Justification of TQM.

Center for Quality of Management Journal. Volume 8, Number 1. Spring. Retrieved at http://cqmextra.cqm.org/cqmjournal.nsf/reprints/rp09600[Accessed 11 December, 2004]

Waldman, David a. Designing Performance Management Systems for Total Quality Implementation. Retrieved from www.ctu.edu.vn/centers/cfl/teaching/ebooks/5.pdf[Accessed 11 December, 2004]

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