What is total quality management (TQM)? 7 essential principles of TQM

After World War II, Japan was quite backward as compared to Western countries-not only because it was badly damaged, but also because it had few natural resources and had to rely on imports. In just 30 years, however, it became an economic powerhouse, dominating (and beating the Americans) in the automobile market. A concept developed by American statistician William Edwards Deming, known as Total Quality Management (TQM) and now used by companies in all industries around the world, helped Japan. Here we explain what it is, its main principles, and the benefits its application can bring to an organization. Read on.

What is total quality management (TQM)?

Total quality management (TQM) is a strategy that perfectly fits into the culture and lifestyle of the Japanese who are known for their meticulousness, diligence, and customer-centric approach. The concept aims to achieve excellence in all areas of an organization’s operations. TQM is a holistic approach that focuses on satisfying customer needs through continuous improvement of processes and products, involving all employees of the company. Such an approach has the potential to ensure the long-term success of the company.

Key principles of total quality management (TQM)

Japanese companies such as Toyota, Sony, and Honda have achieved significant success in global markets by focusing on improving their products and processes. They have implemented key principles of total quality management in their day-to-day operations, which are outlined below.

1. Customer focus

TQM puts the customer first – it focuses on understanding and, above all, satisfying the customer’s needs and expectations. It means that an organization focuses on studying what is important to its customers and then adapting the products or services it creates to those findings.

2. Continual efforts

TQM promotes the concept of continuous improvement, which means that an organization strives to continually improve its processes, products, and services by analyzing, identifying areas for improvement, and making appropriate changes. It uses a variety of tools and techniques, such as Kaizen, Six Sigma, and Lean Management, to identify and eliminate errors, waste, or emerging problems.

3. Employee involvement

In TQM, all employees of an organization are involved in the process of improving products and services. However, companies not only encourage active participation but also listen to employees’ ideas and promote their initiative.

4. Data analysis

In TQM, organizations focus on collecting and analyzing data to make decisions based on evidence rather than intuition.

5. Partnering with suppliers

TQM promotes building lasting relationships with suppliers and striving for excellence throughout the entire supply chain.

6. Error prevention

TQM emphasizes the prevention of errors and problems, which is more effective and less costly than repairing the consequences.

7. Quality standards and certification

As part of TQM, organizations often strive to meet certain standards and apply for various certifications ( e.g. ISO).

Why to implement total quality management (TQM)?

Above all, total quality management leads to greater customer satisfaction because it focuses on delivering products and services that meet or exceed their expectations, and this is the main reason why organizations implement it. But this is not the only benefit that comes with such a decision. Other positive effects include:

• Enhanced competitiveness – through improvement, an organization becomes more competitive in the marketplace. This is because customers are more likely to choose companies that offer quality products or services, which can lead to an increase in market share,
• Cost reduction – TQM can help reduce errors, eliminate waste, and optimize efficiency, resulting in lower production and customer service costs in the long run,
• Greater employee motivation – TQM involves all employees in the improvement process. Employees who see that their opinions count are more motivated to work for the organization,
• Certifications – Implementing TQM often leads to meeting certain standards and obtaining certifications, which can facilitate access to new markets or secure further business partnerships.

Summary

Total quality management can be implemented in two different ways – some organizations create dedicated teams to introduce such a strategy, while others integrate it into their existing systems. Regardless of the implementation method, TQM requires the involvement of all employees, which can still be a challenge in some countries, especially due to resistance to change. However, the benefits like increased customer satisfaction, improved competitiveness, or cost reductions, have the potential to outweigh the significant implementation costs. For this reason, it’s worth taking a look at this Japanese approach and trying to incorporate it into your daily operations.

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