Total Quality Management for Purposes

Total Quality Management

For purposes of this paper, manufacturing, service and government implementations are profiled to show the full extent of TQMs' contributions to these three key areas.

Manufacturing

Toyota's initial efforts in quality management began in the 1960s when the company started using the Total Quality Control (TQC) program for managing its suppliers, manufacturing, and vehicle delivery processes. After years of continually improving quality techniques that comprised the TQC approach to manufacturing, Toyota won the Deming Prize in 1965 followed by the Japan Quality Control Awards in 1970. Toyota's Quality Management Departments had envisioned a roadmap of how TQC would eventually become Total Quality Management (TQM), a more all-encompassing approach to addressing the inclusion of customers' needs into the production and quality assurance process. TQM was also seen as a necessary step within Toyota to allow for greater agility to uncertain and often unpredictable customer requirements. Figure 1 shows Toyota's interpretation of TQM. The company has defined TQM to include innovation through improvement, self-discipline and optimization through team work and the support of an egalitarian-based work culture, and finally a focus on a strong customer-oriented attitude. Toyota's cultural values have significantly influenced their approach to implementing TQM, specifically the cultural value of putting the customer needs first, and the customers' perceptions of quality as critical. Given the cultural norms and values of Toyota there is also a strong commitment to continually increase product quality, service quality, product design and manufacturing form, fit and function of their cars and trucks to align with the current expectations of customers.

For Toyota, TQM is all about earning and retaining the trust of their customers.

Figure 1: Toyota's interpretation of TQM

Toyota Corporations' commitment to TQM pervades their American subsidiaries' approach to managing customer feedback and insights regarding future product direction as well. Toyota's American subsidiary is known to have the largest market research staff of any domestic or foreign manufacturers, have the most rigorous use of JD Powers' Customer Satisfaction Index (CSI) and Sales Satisfaction Index (SSI) scores as a leverage point when working with their channels. Toyota's corporate offices and the American subsidiaries also have integrated the many accounting, finance, production scheduling, service and sales system together so that customers can get a single and complete review of vehicles on order and the current status of their present Toyota vehicles in terms of financing, maintenance and service.

All of this integration and sharing of information is predicated on the trust employees have in each other, and also in the systems they are working with. For Toyota specifically and for manufacturing in general, the ability to deliver transformational leadership and the resulting level of performance to a continually increasing level of customer requirements and expectations shows why this auto manufacturers is considered one of the best in its industry at implementing TQM. Hashmi (2007), in his definition of TQM also heavily relies on the integrative aspects of multiple systems and processes, and this is certainly illustrated in the examples of Toyota's many product successes using this approach to aligning product development and production to customers' needs.

Service

The use of TQM concepts throughout healthcare organizations is increasingly becoming commonplace, with the study of TQM applies to the John Hopkins University Department of Emergency Medicine being a case in point (Academic Emergency Medicine 1999). The results of the primary research completed at Johns Hopkins Emergency Department show that while TQM is still in its infancy when applied to Emergency Departments, significant results are attained after five years of experience and use of TQM strategies. Further, the majority of Emergency Departments gaining the best results are using TQM to re-define patient flows processes, also changing significantly their approaches to managing radiology patient loads, clinical processes, and customer satisfaction indices of performance.

The results of this research into the adoption of TQM into the Emergency Department of Johns Hopkins also underscores the need for extended employee participation, a strong and committed core set of individuals, and administrative support. If these three factors are present, there is also a high probability that there is a hospital-wide TQM initiative already in place. The research results state that many academic teaching hospitals do not have as high of a level of performance using TQM as non-teaching hospitals. This variation could be explained by the significantly different process bases in hospitals where there is instruction and treatment happening at the same time, and therefore there is a high level of variability in each process. TQM is best used in processes that can be standardized; hence the higher level of performance in non-teaching hospitals.

The use of TQM in Johns Hopkins Emergency Department illustrates how the same types of companies can have significantly different results using TQM as a strategy for being more aligned with customers. The first and most significant insight is that the greater the variability of individual processes, the more difficult it is to gain major gains using TQM as an approach for enhancing quality while serving customers more efficiently. In those hospitals with more consistent processes, with trained employees, strong leadership at the upper management levels and a track record of five or more years of performance, TQM is delivering significant results.

Government

The use of TQM is rapidly expanding throughout the entire U.S. Government, with the Internal Revenue Service (IRS) adopting TQM strategies to overcome the many inefficient and wasteful processes the government agency has today. It is estimated three of the four tax preparer questions go unanswered, and that there are literally millions of dollars in inaccurate tax refunds mailed every year. According to the Journal of Accountancy (1994) the IRS is focused on modernizing tax document input and processing, minimizing paper processing, making taxpayer information readily available to IRDS employees, reducing recordkeeping and tax administration costs, and increasing the security and privacy of sensitive taxpayer information.