Management in Business Operations and Performance Term Paper

Excerpt from Term Paper :

Integrating Total Quality Environmental Management Systems - a Critical Study of TQEM

Relevance of TQM to Environmental Management

Scope of Dissertation

Moving from Reactive to Proactive Management

Understanding TQM in Relation to TQEM

History of TQM

Operation of TQM

Quality and Environmental Management Standards

Environmental Management Systems

Weaknesses of EMS Standards

Total Quality Environmental Management

Comparing ISO 9000 and ISO 14000

Integrating the ISO 14000 Environmental Management System


Impact of certification on economic and ecological performances

Research Design and Nature

Integrating a Sustainable EMS with TQM

Steps to Implementing an Effective TQEM Strategy

Final Word




Background and Overview of Study

For decades economic growth has been considered the main indicator of a healthy society (Oliver, 1996). However, only recently has society begun to recognize the environmental cost of this growth. As a result, there is now an urgency to develop the means of satisfying present needs without compromising the ability of future generations to meet theirs. The implementation of sustainable management initiatives within organizations has largely been reactive, responding to environmental pressures, legal obligations, risk management, customer demands and competition. Some organizations have taken strategic advantages of such initiatives for commercial self-interest or to increase the stakeholders' perception of the organization. These views will challenge the traditional outlook of organizations, as stakeholders interpret sustainable development through constraints of politics, economics, science, culture and religion.

All types of economic activity involve utilization of environmental or natural resources. Around the world, leaders have realized that production and consumption patterns have become unsustainable. Increasing awareness and growing public concern about the negative impacts on the environment and natural resource base has caused governments to reconsider existing strategies for growth and economic development. Most countries are now trying their best to balance the development and environmental needs based on the economic situation in their countries.

Prior to the 1950s, the common business response to environmental pollution was to ignore these types of problems. This was possible when the problems were smaller and the awareness of the health and environmental impacts was low. In the 1960s, a common approach to pollution was to assume "the solution to pollution is dilution" concept. Air pollutants were dispersed by tall smokestacks and water pollutants were discharged. However, these diluted pollutants accumulated in soil and water and eventually found polluted the food chain.

In 1970s, the government realized that pollutants had exceeded the capacity of the environment. There were efforts to establish environmental standards to regulate the discharge of pollutants. This resulted in the use of end-of-pipe (EOP) treatment systems. As the discharge standards became tighter, the cost of such end-of-pipe treatment of wastes became more expensive and affected the economic viability of many industries.

Besides the high costs, the end-of-pipe treatment approach was found to be ineffective. Pollutants were not eliminated, but simply transferred from one medium to another. The policy responses came in many forms, ranging from command-and-control regimes to voluntary systems emphasizing prevention of pollution at its source, waste minimization, cleaner production, and environmental management systems such as the ISO 14000 series. These voluntary systems were found to be more cost-effective and viable than using a command and control approach alone.

To survive in global marketplace that expanded in the 1990's meant challenging and changing the way that business had been carried out since the beginning. What made it all the more difficult to see the need for change, was the success and profits that businesses had enjoyed in the past. A change management process was necessary. As a result, corporate social responsibility (CSR) was born.

CSR promotes a vision of business accountability to a wide range of stakeholders, besides shareholders and investors (IISD, 2002). The main areas of concern are environmental protection and the well-being of employees, the community and civil society in general, in both the present and the future.

The concept of CSR is based on the idea that corporations can no longer act as isolated economic entities operating apart from broader society. Traditional views about competitiveness, survival and profitability are being eliminated and unity is encouraged.

Some of the drivers pushing business towards CSR include the following (IISD, 2002):

The shrinking role of government: Traditionally, governments have relied on legislation and regulation to deliver social and environmental objectives in the business sector. Shrinking government resources, combined with a distrust of regulations, has caused the exploration of voluntary and non-regulatory initiatives.

Demands for greater disclosure: There is an increasing demand for corporate disclosure from stakeholders, including customers, suppliers, employees, communities, investors, and activist organizations.

Increased customer interest: There is evidence that the ethical conduct of companies exercises a growing influence on the purchasing decisions of customers. In a recent report by Environics International, more than one in five consumers reported having either rewarded or punished companies based on their perceived social performance.

Increasing investor pressure: Investors today are changing the way they assess companies' performance, making decisions based on criteria that include ethical concerns. The Social Investment Forum reported that in 1999, there was more than $2 trillion worth of assets invested in portfolios that used screens linked to the environment and social responsibility in the U.S. A separate survey by Environics International demonstrated that more than a quarter of share-owning Americans took into account ethical considerations when buying and selling stocks.

Competitive labor markets: Employees today are looking beyond paychecks and benefits, favoring employers whose philosophies and operating practices match their own principles. In order to hire and retain skilled employees, companies are being forced to improve working conditions.

Supplier relations: As stakeholders become more and more interested in business affairs, many organizations are taking steps to ensure that their partners conduct business in a socially responsible manner. Some are introducing codes of conduct for their suppliers, to ensure that other companies' policies or practices do not blemish their reputation.

Some of the positive outcomes that may arise when businesses adopt a policy of social responsibility include (IISD, 2002):

Company benefits, such as improved financial performance; lower operating costs; enhanced brand image and reputation; increased sales and customer loyalty; greater productivity and quality; more ability to attract and retain employees; reduced regulatory oversight; access to capital; workforce diversity; product safety; and decreased liability.

Benefits to the community and the general public, including charitable contributions; employee volunteer programs; corporate involvement in community education, employment and homelessness programs; and product safety and quality.

Environmental benefits, including greater material recyclables; better product durability and functionality; greater use of renewable resources; integration of environmental management tools into business plans, such as life-cycle assessment and costing, environmental management standards, and eco-labeling.

Despite these benefits, many companies continue to overlook CSR in the supply chain. For example, some companies still import and export timber that has been illegally harvested. While governments can impose embargos and penalties on offending companies, the organizations themselves benefit by making a commitment to sustainability by being more discerning in their choice of suppliers.

Today, the concept of corporate social responsibility focuses on the global business agenda. However, in order to move from theory to concrete action, many obstacles need to be conquered.

A key challenge facing business is the need for more reliable indicators of progress in the field of CSR, along with the distribution of CSR strategies. Implementing total quality environmental management programs can help businesses overcome many challenges and gain a more trustworthy reputation, while increasing the standards of other organizations at the same time.

Relevance of TQM to Environmental Management

One reason that TQM is perceived as relevant to environmental problems is a belief that it produces radical improvements in the performance of any activity it is applied to. However, there are also more specific connections between the objectives and practice of TQM and environmental management.

These are as follows:

TQM's emphasis on the importance of customers and its broadening of the term beyond mere purchasers of a product provides a useful framework for considering and responding to the demands of environmental stakeholders;

TQM's emphasis on commitment to continuous improvement is very helpful to organizations wishing to move beyond mere compliance with environmental regulation;

TQM's focus on eliminating the root causes of problems rather than their symptoms fits with the growing awareness that pollution prevention is often a better approach to environmental problems than "bolting on" pollution control equipment;

TQM's belief that quality is everyone's responsibility within a company fits well with the growing awareness that all employees have to make a contribution to environmental performance;

TQM's concern with calculating the cost of (non) quality provides a useful framework for considering the total costs and benefits of environmental action or inaction.

Statement of the Problem

Consciousness about environment friendliness has caused a lot of companies to change their business approach (Anthony, 2002). Adopting a pro-environment approach is a proven method to improve a company's cost efficiency, quality, delivery and flexibility. This change is however posing a challenge in areas like production planning, inventory management and distribution, making…

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