Total Quality Management (TQM)

The goal of total quality management (TQM) is for an organization to realize continuous improvement in its business processes for the benefit of its end customers. These processes involve the procurement of material, the production process, and the distribution of final goods to the customers. As an integrative process, TQM requires the use of both information and human resources to foster continuous improvement. It may also be considered the philosophy supporting modern supply chain management. Since today's firms often find it advantageous to establish flexible contractual relationships, as opposed to inflexible mergers, it is important for potential supply chain partners to demonstrate a mutual commitment to raise quality. Despite a lack of agreement on a precise definition, TQM has been used as a clarion call to initiate a change in process—which may or may not conform with any other type of organization's attempt to raise quality. Therefore, TQM is best understood as an intention to achieve something rather than something subject to a strict definition.

Quality itself may have different definitions; therefore, it should come as no surprise that any technique sought to manage it would be limited in terms of the assumed definition of quality. One view is that quality comes from uniformity and conformity of the product to the demands of the marketplace. Another view is that quality is evidenced from the product's availability and ultimate usefulness. These definitions have an important difference in terms of customer service. The first purports a strong form of consumer sovereignty, while the second recognizes that the producer has a role to play in educating the consumer as his or her demands in the marketplace form and evolve.

TQM, as a systems approach, seeks to lower costs and increase customer service at the same time. While these twin goals may be looked on as a trade-off, the focus on all the people within an organization, and along its supply chain, brings to the fore the need to work toward a common goal (i.e., customer satisfaction) by the sharing of information. What is required is a consensus over what defines quality along the supply chain and what is necessary to maintain it over the long run. Of course, market realities such as changes in technology and customer tastes mean that the process must be subject to change and adaptation. As such, TQM must be part of the long-term strategic vision of any organization wishing to practice it.

TQM may be looked on as a business philosophy applicable to all facets of manufacturing and service provision. Its roots may be traced to the pioneering work of quality theorists such as W. Edwards Deming and Joseph M. Juran in the late 1940s and early 1950s. Both took notice of the Union of Japanese Scientists and Engineers, formed in 1949, to improve Japanese productivity and quality. While both Deming and Juran [Page 2079]developed their ideas through studying U.S. firms, it was the Japanese manufacturing sector that took most strongly to their work. Deming began his work with the Japanese in 1950 and Juran followed in 1954. At first the emphasis was on methods of statistical quality control; that is, randomly sampling output to estimate the likelihood of defects. But, through Deming and Juran, the emphasis soon expanded from collecting statistics to the wider task of examining organizational processes. In other words, a paradigm shift was occurring beyond merely controlling defects to one where defects were to be prevented. Quality was now seen as part of efficiency. Customer satisfaction was to be sought as opposed to profit in and of itself. While TQM, as a concept, grew out of this work, it must be noted that the pioneers themselves never used the term. Referring to TQM in 1994, Deming himself noted that it was a buzzword, that there was no such thing, and that the term carried no meaning. Typical of buzzwords, and as noted above, there is no standardized definition of TQM since the term has been adopted in a wide variety of ways over several decades. The actual term total quality management was coined in 1985 by the Naval Air Systems Command, which adopted its own version of quality management.

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