Definition of TQM

Total Quality Management is a widespread and ample theme. Hence, there are found several definitions
of TQM in the literature because of different aspects from the authors. Jack Hradesky (1995) gave a good
and summarized overview about TQM in his “Total Quality Management Handbook”: “Total Quality
Management (TQM) is a philosophy, a set of tools, and a process whose output yields customer
satisfaction and continuous improvement.” TQM combines cultural-changing tactics and structured
technical techniques whose focus is on satisfying the needs of internal and external customers. TQM
requires that the executives are involved and committed, not just interested, and that the focus is on
implementation. Results of TQM include error-free processes which deliver products and services fit for
use, on time, with competitive pricing and good value.

TQM is a leadership philosophy and strategy that is based on continuous improvement of every process,
empowerment of people, continuous learning, all creating transformations towards an organization that is
providing excellent products and services. Thus, TQM in an organization brings all the people together to
ensure and improve product process quality, the work environment and working culture.

Quality Journey in India

Quality is defined and measured differently, largely dependent on one’s viewpoint. Juran, foremost of
the quality gurus, defined quality as fitness for use. A very concise definition indeed, for a term that has
so many dimensions. Quality of a product or service in simple terms is its
suitability for use by the customer. Quality has to be perceived by the customer. Perception of the supplier
is also important, but the customer experience of quality of a product or service is more important.

However, the post-independent era did not witness any spectacular improvement regarding the quality of
goods and services produced in the country. Besides, lack of consumerism, Government control on
everything, bureaucratic delays, quick profit making attitudes by the companies, all resulted in quality
getting a low priority and consequently. Indian products were constrained to serve only the domestic
market being not able to compete in the international markets.

In 1996, the Government of India announced the setting up of the Quality Council of India, (QCI) with
the Industry Ministry bringing in half the seed capital of Rs. 1.5 crores. The rest of the seed capital will be
contributed by the corporate sector.

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TQM can be a powerful technique for unleashing employee creativity and potential, reducing bureaucracy
and costs, and improving service to clients and the community. TQM is focused on quality, presumably a
concern of both management and workers, and methods improvements should eliminate wasteful
bureaucratic activities, save money, and make more human resources available for core activities,
specifically client service.

TQM in the Automotive Industry

Product quality in an automobile supply chain can be attained through TQM. Many OEMs use this
philosophy to achieve customer satisfaction. However, the current market situation is characterized by an
outstanding tough competition which means for the automobile OEM that it has to provide top-quality at
low price. Nowadays, this is the main challenge for automobile manufacturers and TQM helps to handle
low costs and high quality to meet the challenge.

AUTOMOTIVE sector has been dynamic in inventing new manufacturing strategies

owning to prevailing high level of competition. With this scenario the challenges faced
by Original Equipment Manufacturers (OEM) have also multiplied over the years.

Customers are demanding individualized final products. This is especially true of the
OEM. While the organizations will have some standard base products, the total number
of options that they have to offer to the consumers should be plenty. ERP will allow
management of these configurations.

Through the supply chain there is need for innovation and new product development with much reduced
life cycle for development. Hence, the NPI (New Product Introduction) will greatly help in promoting
concurrent engineering.

Automotive industry is characterized by the presence of dedicated customer-supplier relationships and the
competition in the market is between supply chains and not individual organizations. Hence, supply chain
efficiency is thus very important. The principles of Just-in-Time (JIT), Lean Manufacturing and others
become very important here. ERP will help in promoting these concepts.

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Another challenge faced by automotive industry is the pressure to reduce delivery time and cost. A
comprehensive supply chain solution that crosses the organization boundaries (B2B) is required. Different
elements of the supply chain interact very closely.

Quality Management module with support for advanced features like TQM will help to promote quality at
source. This receives significance owing to the continuous pressure exerted to cut cost and improve
quality.

As the automotive market is extremely price sensitive, the features of comprehensive costing and kaizen
costing will be of special relevance here. Understanding the accurate cost of manufacturing and
identifying all potential areas for reduction of costs is one of the keys to success.

General Motors

General Motors today has manufacturing operations in 32 countries and its vehicles are sold in 192
countries (www.gm.com). To gain a better idea of General Motors position in today's market. By having
such a strong presence globally, General Motors can integrate its operations so each manufacturer can
concentrate on its core competencies. For example, automakers are trying to drive down costs by
sharing costs through their own global alliances, or in joint ventures or partnerships with other
companies. One reason that General Motors is sitting at the top of the industry could be due to the fact
that it also lead the industry in ad spending. The main problem with General Motor's plants in the United
States is that they have too much capacity, which in turns causes them to make bad long-term business
decisions.

Innovation is the backbone for any corporation these days, and it is crucial that General Motors stays a
leader in innovation as well as sales. . Hopefully, the technology on how to produce Hybrid cars with
economy of scale will be shared throughout the industry, enabling General Motors to compete at the same
level as its competitors.

DamilerChrysler

The DaimlerChrysler umbrella covers many well-known brands such as Dodge, Chrysler, Mercedes
Benz, and Jeep. DaimlerChrysler is even represented in the realm of ultra luxury with its Maybach brand
which competes directly with manufacturers such as Bentley and Rolls Royce. 

The merger of Chrysler and Daimler Benz which created DaimlerChrysler gave the company a large
worldwide presence. This presence is a quality one because DaimlerChrysler is considered to be one of

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most respected companies worldwide according to a Financial Times survey of world corporate leaders.
This presence is further increased by DaimlerChrysler's strategic partnership with Japanese car maker
Mitsubishi. This partnership gives DaimlerChrysler presence in the Asian regions which is does not
currently enjoy with its current stable of brands. This partnership will not only allow for greater product
visibility for DaimlerChrysler in one of the largest automobile markets, but will also allow for sharing of
technology between DaimlerChrysler and Mitsubishi.

In the arena of Technology Leadership DaimlerChrysler boasts that it is a world leader in the
development of hydrogen fuel cell powered automobiles. DaimlerChrysler hopes that its research into the
new power technology will result in affordable vehicles powered by the alternative fuel source in the neat
future.

Toyota Motor Corporation

Toyota has traditionally also been the leader in Total Quality Management or TQM. The belief that no
process could ever be declared perfect, and that therefore there was always room for improvement was
introduced by Toyota Sakichi. This brought about the Japanese word, Kaizen meaning continuous
improvement. By using the Kaizen theory of continuous improvement, Japan caught up the U.S. auto
makers during the 1980's.

Toyota also lives by the word Kaizen which translate into continuous improvement. Toyota introduced
TQM and Kaizen to the world with the help of Edwards Demming to take the world by surprise and focus
on quality and improvement constantly instead of just the bottom line and this focus has helped the
Japanese company to become one of the leaders in the auto manufacturing industry. Toyota also has an
advantage over their customers today using the TQM model of operations.

Masaaki Imai, inspired by the book “Total Quality Control” by Armand Feigenbaum (1951), created
a new business philosophy in Japan known as Kaizen, which can be defined as “a means of continuing
improvement in personal life, home life, social life, and working life. These practices would later evolve
into many others, including Total Quality Management(TQM), Six Sigma, and Twelve Sigma.

Transforming an Indian manufacturing company: The Rane Brake Linings (RBL)

RBL decided to focus on Policy Deployment and Daily Routine Management (DRM) to achieve their
TQM implementation. As a result, RBL redefined its management of processes for New Product
Development System, Manufacturing Quality, Supplier Quality and Customer Quality. In the new system,

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each manager was required to define his role, his metrics, his measurement of performance to date and the
steps being taken to improve performance. TQM implementation created tangible and intangible benefits
for RBL. Intangible benefits included role clarity so that each person understood their role in the
organization, their suppliers and customers, and their metrics. The focus on competency and involvement
resulted in a different approach to managing people.

RBL evolved as a result of its Deming journey

RBL is described as having moved to a “strategic” mode of business operation. In such a mode,
leadership focuses on strategic direction and uses cross-functional interfaces at all levels. Customer
contacts are viewed as opportunities and closeness with customers is encouraged. Employees are regarded
as key resources with large investments in human capital. It is also different because it has adopted TQM
to managing non-manufacturing processes. When a potential buyer contracts to RBL, they become part of
the TQM processes for improvement. This means that the specific business processes affect the cost
reduction rate or the quality improvement rate for the buyer. The speed of response to engineering
specification changes, customer requests etc. all affect the overall cost to do business.

The strategy used by Rane Brake Linings provides one approach to the development of such capability
that focuses on both policy deployment and daily routine management and thus moves a firm from a
“basic” state of operation to a “strategic” mode of operation. The end result is an ability to engage with a
potential buyer both to deliver current product designs as well as to evolve new designs and products over

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time. As most global buyers would attest, learning about a potential supplier’s “mindset” is a crucial step
in the final choice – RBL’s journey to adjust and
document their new “mindset” offers them significant future potential to engage with the global buyer.

Finally, the company is focused on making big improvements, market expansion, and achieving its global
ambitions. This step alone decreased error rate from 25 % to 3 %. These changes increased the acceptance
rate from 75 % to 98 %.

In 2002, RBL won the prestigious Deming prize. The Deming prize, awarded by the Japan Union
of Scientists and Engineers (JUSE), was the culmination of a three-year journey for RBL, which began
with a visit by professor Tsuda from Japan.