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Introduced in the 1950s and made more popular in the 1980s Total Quality Management is a very radical management style. A strong Total Quality Management plan relies on internal as well as external team building. A mistake to avoid before the implementation of a Total Quality Management strategy is an inaccurate analysis of the precondition and current state of an organization. Leadership styles and the organizations culture need to work well together. If they do not, this process should be delayed until an accurate assessment and favorable conditions exist. This paper defines Total Quality Management and examines the impact of globalization on quality. In addition, traditional management styles and quality focused management styles are compared and contrasted. Finally, how Federated Department Stores applies Total Quality Management is explained.
Total Quality Management Defined
Total Quality Management is the techniques an organization uses to improve the quality and production level. This technique involves teamwork and is used horizontally across an organization. Internally all departments and employees are included. Externally all suppliers and clients/customers are included. The most important objective of Total Quality Management is to implement effective quality and productivity plans that will raise profits and give an organization a competitive boost. According to Hashmi (2006), "Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with processes being done right the first time and defects and waste eradicated from operations" (Paragraph 2). To be effective Quality Management must be continuously improved upon by management and employees. Companies that have initiated the Total Quality Management process include; Ford Motor Company, Phillips Semiconductor, SGL Carbon, Motorola and Toyota Motor Company (Hashmi, 2006). Currently a broad range of organizations use Quality Management; originally designed for manufacturing and for many years only used in that area. Today, Quality Management is considered an extremely adjustable strategy and has become a basic management tool in service and public organizations.
Traditional Management vs. Quality Management
Traditional management styles place an emphasis on the internal work environment. If an organization has done the best job possible to produce a product or service it is assumed to be of good quality. Total Quality Management looks at the end user to determine the quality. The important decider is the customer; quality management focuses on the customer.
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If a product or service is a bad quality, traditional management believes the employees are not doing the job correctly. The big difference with Quality Management is the responsibility goes to middle management in operations area (Lean Manufacturing, 2006). Teamwork is the main building block in Quality Management; if the company is not unified Total Quality Management will not work. Lean Manufacturing states (2006), that "Unlike in traditional management style, total quality management makes decisions on facts and figures. Therefore, problems are identified correctly. Therefore solutions are well planned" (Paragraph 6).
Continuous thinking and improvements are a piece of the Total Quality Management plan. Constant improvements are necessary but should be small and stable. Many differences exist between traditional and Total Quality Management. Total Quality Management has changed the culture and the way organizations think.
Total Quality Management and Globalization
Expanding globalization means stiff competition in the international markets. Some of the reasons for this competition include developing and former communist countries entering the marketplace, the introduction of new products and procedures, old material being efficiently used and innovations in technology. These are some of the reasons that have shifted markets that were once considered reliable. The global economy demands more innovation, higher quality and increased productivity.
Japan was the first to lead the quality initiative in the 1950s, during this time American organizations were producing mass quantities the traditional way. America thrived on the war damaged European countries. By the 1970s Asian competitors began to surpass America; the American industries were considered inferior. As globalization increase the U.S. manufacturing industry-decreased because of more competitors, especially Japan. By the late 1980s the U.S. market scrambled to retrieve some of the market back from Japan. They began to adopt quality and productivity procedures to restore their competitiveness. In the 1990s the U.S. manufacturing industry began to retrieve gains in quality and productivity.
Total Quality Management and Federated Department Stores
Total Quality Management at Federated is applies to the logistics and Operations department. The most important responsibility of Logistics and Operations is the efficient and timely flow of new receipts to the sells floor; the right merchandise must be delivered to the right locations at the right time. Other responsibilities of this division include small-ticket and large-ticket distribution centers, coordinating transportation and shuttle deliveries, handling vendor returns, merchandise liquidation, delivering merchandise, primarily furniture and other large-ticket items, to customers' homes, and fulfill Internet and catalog orders (Federated Department Stores, 2006). To support all of the above functions Logistics and Operations aggressively implement new systems and up to date technology. They also diligently work with vendors to preserve the high standards of Federates supply chain. Management's objective is to constantly improve people, procedures, and technology; this enables the organization to advance service, speed and accuracy. With this in place, supply chain and logistic cost should decrease.
In 2001, Federated was one of the first retailers to assume the Six Sigma quality improvement techniques to create and drive a focused culture, expand operating capabilities and improve processes (Federated Department Stores, 2006). The organization was a leader in the EDI (electronic data interchange) this system sends purchase orders over the web instead of by fax. Federated distribution centers employs state of the art material handling systems and is a leader in RFID (radio frequency identification) to help speed the flow of merchandise through the distribution centers.
TQM promotes involvement between all workers and management. A strong Total Quality Management plan relies on internal as well as external team building. The most important objectives of Quality Management are planned and continuous improvement. A successful TQM plans needs a combinations of quality systems as well as a strong culture between management and employees. If these conditions are not met the process should be delayed until the proper circumstances exist.
Federated Department Stores, (2006). Logistics at Federated. Store Operations instruction manual, 2006.
Hashmi, Khurram, (2006). Introduction and Implementation of Total Quality Management (TQM). Retrieved on March 24, 2007, from www.isixsigma.com.
Lean Manufacturing, (2006). Quality Management. Retrieved on March 25, 2007, from www.leanmanufacturingconcepts.com