TOTAL QUALITY MANAGEMENT

BY J.O. OYETADE
B.SC., FCA, MBA

BEING A PAPER PRESENTED AT A WORKSHOP ON: COST REDUCTION AND COST CONTROL ORGANISED BYTHAMESMEAD CONSULTANCY LIMITED AT AVALON HOTEL,OFFA, KWARA STATE 6TH -8TH AND 13TH AND 15TH OCTOBER 2007

INTRODUCTION If the management of any company has it imperative to perform effectively and efficiently, there is need for change. This is because there is no condition that is permanent in life except for a change. Business environment that is full of opportunities and threats must also strive for change. To achieve this goal in the face of competitive activities, the idea of Total Quality Management must be evolved people and the organization themselves will not be satisfied. Total Quality Management which is often referred to as TQM is a modern management technique and philosophy aimed at satisfying the customers always in a highly competitive world of business. It applies to all the various organizations, public and private enterprise where their objectives include serving the people maximally from the available resources. Thus, the ultimate goal for business is to ensure that their customer or target public get the best possible to satisfy their wants. To accomplish this goal, most companies have embarked on full-scale TQM programme so as to really prove the quality of their management. The advent of modern management technology, therefore, made use of Management by Objective, Strategy Planning, Effective Communication, Participative Management, Delegation of Representatives and Authority among others as relevant tools or instruments. From these analyses, it would easily be seen that TQM is a catalyst for the achievement of the objective of any organization. TOTAL QUALITY MANAGEMENT TQM is a technique and form of management which was developed in America and France by Management Practitioners a long time ago. But in todays competitive market, successful businesses have learnt that customer satisfaction derived from excellent service is the key to their successes. Tom Peters (1991). Author of In search of Excellence, has said that Excellence in service should be thought of as the product of any company or institution. Both manufacturing and service organization must re-focus their efforts to achieve excellence in service if they are to survive. When it comes to customer service, even a small failing can prove costly if not fatal. National and international competitions have raised the stakes. Organization in both

the public and service sectors are now struggling to re-tool to change excellence in service. Business lenders are looking for new models that will help them reorganize their approach to management and undo long habits of indifference to customers. The senior executives have realized that development and implementing a management strategy that ensures a high performance at work place is paramount. The most insightful, know that real change means as organization wide shift in management strategy commitment to excellence of the organization from top management to the mail-room staff. DEFINTION TQM is a form of management, and is a concept focused on how to satisfy the customer constantly. Such satisfaction is viewed un terms of issues like the quality of the product, its involves making constant effort to identify what the customer wants from time to time and determining how best to cater for such wants. This is in recognition of the fact that the customers need and desire normally change over time in time with the changes which may occur in some key aspect of the technological changes. Hence TQM further implies a culture of continuous improvement which, in turn implies continuous learning and adaptation to change in both customer demand and the concomitant product or operation methods. From this assertion, TQM attempt to make optimum use of all available resources by dedication of the highest possible standards in all external and internal process therefore, leading to customer satisfaction, improvement market share and profit growth. However, TQM focus on the customer does not mean it neglects the interests of other stakeholders such as the entrepreneur, labour and environment. These other factor too contributes immensely to the success which is overlooked may cause failure. But the placement of more premium on customer satisfaction than on short term profits in its daily operation indicate the uniqueness and importance of the customer.

WHAT DOES IT MEAN TO AN INDIVIDUAL? The modern business world is a competitive environment, we know only the best wins and only a winner will be able to use commensurate reward to their winners. TMQ if properly implemented will enable the organization to be a winner, and a winner will be able to continue to provide job security, opportunities and rewards for its employees. That means for the workers and his family but security taste only if the organization win in market place. It has to be an emotional experience, either positive or negative, TQM requires a cultural change. WHY TOAL QUALITY MANAGEMENT IN NIGERIA TQM is strategic and represents organization response to present market realities characterized by:I. Increasing competition II. Standards of technology III. Continuous changes in consumer demand IV. Raising costs of factors input resulting from wastages V. Increase in consumer protection. However, faced with this scenario, service organization and manufacturers like any other player in the market were left with two basis of competition namely:- service - price The choice of service excellence is a strategy for gaining competitive advantage and this hinged on fact that price competition cannot be sustained in a high regulated economy like Nigeria. But in the long run, excellent service can influence prices in a manner that facilitates the objective of any rational firm. Thus, their commitment to service excellence is a testimony to their corporate philosophy of TQM which is adopted to achieve other desirable ends. These include improving staff moral, customer retention and cost reduction.

ELEMENTS OF SERVICE QUALITY A company that wishes to provide consistently good service quality has to commit itself to incorporating the following key efforts:a) Quality care b) Customer care c) Flip ( frontier people) care d) Communication care e) Leadership care However, as the focus is mostly on customer, a pertinent question which may be asked is what special service do consumers and other stakeholder enjoy under TQM? To do so, Ajani E.O (2002:43) provide a clue by saying that the TQM addresses, first and foremost, the issue that is most important to every customer namely, how to obtain relevant goods and services at the particular time or time they are needed, in the right quantity and quality, and at the minimum cost possible. Hence, TQM identify what is required and proceeds to produce and deliver them as required, making sure that they are durable, safe and reasonable up to date. All these imply, among other things, constant adaptation to changes and providing consumer with all the information required for the maximum enjoyment of relevant goods and services. In the case of machines and equipment for instance, consumers would be informed about components, usage and maintenance approaches. They would also be provided at once with all complementary or auxiliary items that may be needed. Similarly, with the TQM adoption, business owners and shareholders will get returns on their investments through increased operation efficiency, just as labour will obtain adequate compensation for that contribution to corporate achievements. Operation generally would be strained less and exposed to less danger through constant work study, leading to improvement in work methods and procedures, coupled with the provision of necessary training, tools and materials. People are, thus, enabled to benefit materially from the operations of enterprises. STRATEGIES OF TOTAL QUALITY MANAGEMENT TQM as a business strategy implies, that many Nigerian firms now adopt this approach to succeed and survive. And to embrace the idea of delivering superior quality to their customers and clients, the principle of business

strategy will serve as important link of superior quality and low cost. This can be argued that quality of any features of a product or service costs money and the more quality in a product, the higher the cost of the product according to the Economists. Since many managers relied on inspection after production to achieve high quality, the economists were correct in observing that quality costs money conversely, it may be viewed in another way that when quality of goods/services is improved, costs decreased because of less work. With fewer mistakes fewer delays and better use of machine, time and materials, productivity would inevitably improved and the organization would capture the market with better quality and lower price. But quality is a strategy that must permeate an organization throughout its business activities. Firms nowadays pay attention to designing the product to eliminate recurring defects in production and also manufacturing processes are designed to reduce errors. The continuous improvement of products/services will yield greater value to customers by paying attention to quality. The cost of quality is the cost incurred in producing poor quality goods and services and continuous improvements, the cost of quality are driven down. And with lower costs and higher quality, the firms can provide more value to customers. Total quality is, therefore, different from other strategies and systems. This management systems and behaviors require firms to focus on external customers and on cross functional horizontal systems and/or process cross functional systems are activities and resources that are linked to provide value to customers and that span at least two of the functions of design, production, marketing and finance as well as personnel (human resource) with fewer levels of management less direct supervision, continuous process improvement, cross-function teams and more employee training, Quality improvement is the fundament business strategy of this 21st century. No business without it will survive in the global market place. Total Quality Management shows the managers how to operate within a business by focus on customers. Consistently satisfying their needs companies which adopt quality management practice, are said to be experiencing over all improvement in corporate performance, better employee relations higher productivity, greater customer satisfaction, increased market share and improved profitability. But there is a positive relationship between quality and profitability, and for measures of profitability return on sales and return on investment. Return on is a measure of profitability in which profit are expressed as a percentage of

sales. Return on investment is a measure of profitability in which profits are expressed as a percentage of investment. As from customer satisfaction, it is also very important to focus on competitors in the formulation and implementation of business strategy. This is because it helps the firm find ways to improve process and systems through the activity of market. It should be noted that some competitors pursue a follower strategy because they are not the first to market a new product and therefore destined to realize below average financial terms. Since, other set of firms pursue leader strategy, a good company with TQM needs to study and possibly even emulate the best processes and systems. Thus, analyzing what the best competitor or leading companies in the industries are doing in order to discover the products, processes and practices that satisfy customer needs. It is in this regard that value quality is being imbibed as a culture in organization. The business objective is to move the firms customers to a position of higher value realized and lower value sacrificed so that the best net value in the industry is offered. For new product development systems, TQM firm frequently utilize personnel from most of the function areas in the company to work together on the design of new products. The design engineering department of the company develops product quality programmes. Such department addresses issues affecting the customer, quality of the product, better quality service and improvement on past production as well as after sales satisfaction, But as consumers demand high quality at low prices consideration must be given to customers characteristics vis a viz customers attitudes, beliefs, expectation etc as quoted by some authors, a customer-service audit asks managers the following questions:1. What are customers objectives? 2. What services are provided 3. How does your firm compare with competitors? 4. What services do customers want? 5. What are customers service patterns of demand 6. What trade offs are your customers prepared to make? The following guiding for effective customers service progrmmes implementation are provided:I. Educate customers II. Educate employees III. Be efficient first, nice second. IV. Standardize service response system

V. Develop a pricing policy VI. Involve subcontractors of necessary VII. Evaluate customer service TQM strategies are derived basically from the realization that output is strictly a function of input and that quality is the result of the result of inputs and their manner of usage. In practical operations, this spells out into the following issues (Ajanji, E.O 200:44 quality Drummond, 1994: 14) a) The quality and sustainability of inputs b) The manner in which inputs are delivered stored, and transformed into a product or service. c) The manner in which the product or service is delivered to the customer used and installed. QUALITY TOOLS The Total Quality Management makes use of different instrument in arriving at good decision and effecting employee performance. These tools comprise of: Flow chart: this is one of the most important actions in bringing process control to both administration and operations. It helps in defining, understanding and solving management problems. Control chart: it is a method of statistic process control (SPC) that can be used in the service industry to control any process. It uses statistics to tell which to adjust the process and when to leave it alone, and also recognizes that variations always exists and helps in controlling the distribution rather than individuals. Histogram: This is a graph that shows how variable measurement of a given object or process are, if depicts the frequency distribution of data collected on a given process. Brainstorming: It is an organized process and techniques used for generating situations. It believes in collecting efforts: team or group work that produces greater and better results than single or individual efforts as it provides opportunity for creative thinking, or ideas and also promotes effective joint decision making. Cause and effect Diagram: This is a structural diagram used to separate and defined causes. The effects are the symptoms which enable one know the problems at hand and how to solve them. Pareto Diagram: This is a universal tool and a principle that can be applied in any field. It visualizes data to assist investing and analysis

and also for establishing priorities, showing percentages, communication aids, and showing recurring changes. Statistical Technology: It should be recognized that statistics play a vital role in quality improvement. This is because the change that occurs must be based on facts and not opinions. Facts, therefore, require data which must be analyzed to determine variation and prompt reactions to the problem. And a tool used extensively in research, the total quality management involves all business functions that make use of or refer to research and development. CONCLUSION There are many businesses that fail because of managerial inexperience or ineptitude. This is a as a result of poor management decision making and poor planning especially with regards to the quality of service or product provided. The adoption of a TQM approach in the administration of all types of business will help to promote excellence, enhance the quality of service provided and ensure sustainability and growth of the business. The concept of quality in business must, therefore, start with Quality Control System; control of quality during an operation process and at the past process stage. This gives credence to Quality Assurance by removing root causes of poor quality and move on to Total Quality that apply the quality assurance to every company activity so that zero defects are achieved. Lastly, is the idea of Total Quality Management that ensures continuing improvement process and getting things done correctly first time. It also calls for participation of every and maintenance of good relationship and team spirit. This must reflect the efforts to satisfy customers or the relevant public in all situations. In achieving this goal and that of the other objectives of the business, continuous changes are inevitable. Thus, living in an environment of constant changes require creativity flexibility and open mindedness of the management as well adaptation of quality standards in the companys product and/or changes require creativity flexibility and open mindedness of the management as well adaptation of quality standards in the companys product and/or performance. The business activities and programmes or plans will succeed better if the principles of TQM, are acceptable and adopted by both the planners and executors of relevant programmes.

REFERENCES Ajayi, E. O. (2002) Total Quality Management as a Catalyst for National Prosperity Management in Nigeria Journal of Nigerian Institute of Management January, March, Vol. Drummond, it (1994) Total Quality Management: What Quality is all about. London Kogan Page Ltd. Ojo, Elizabeth Fadeke etal (1995) Total Quality Management and organization Effectiveness in the Manufacturing Sector. A case study of NNPC being a research project submitted to secretary studies Department in school of Management and Business studies Lagos State Polytechnic in December Udeh, John O. (1999) Entrepreneurship in the 21st century. Enugu the Catholic institute for Devept. Justice and Peace. Witcher, Barry J. (1990) Total Marketers: total Quality and the marketing Concept QRM: The quarterly Review of marketing published by London: the Chartered institute of Marketing (CIM) Vol. 15 No 2. Sannie, M.B.A (2000) Customer Relation in total quality management (TQM) A paper presented at a seminar organized by DTS Consultancy Services in Lagos, Otta December 3-5, 2001.