Total Quality Management

from the Perspective of Competitive Advantage

by
Edwin B. Dean

Total Quality Management, or TQM, is an American perception of managing quality. Using the literature we can form a measure of the maturity of TQM relative to Total Quality Control (TQC), it's predecessor and competitor.

Sullivan (1986) defines seven stages of quality in Japan. In order of increasing level of quality, they are: product oriented, process oriented, systems oriented, humanistic, society oriented, cost oriented, and quality function deployment (QFD). They are also in largely overlaped relative time sequence. Since Mizuno and Akao (1994) was published in Japan in 1978 and since it contains very mature applications of QFD, we know that the leading edge of stage seven preceded that date by several years. In comparison, published understanding in TQM of the totality of QFD is still immature relative to those examples. Mizuno and Akao (1994) places the beginnings of QFD in Japan within the early 1960s. This corresponds to the late 1980s within TQM in America. Mizuno and Akao (1994) also shows evidence of the systems approach as early as 1965 with a probable maturity in the mid 1970s. Although a few American TQM practitioners have probably attained mature systems level quality, the majority are still struggling with the implementation of stages 1 and 2. Also, with the American win/lose philosopy currently in vogue within business process reengineering (Hammer and Champy, 1993), it is obvious that American TQM, on the average, has not reached stage 4, humanism. The roots of humanism within TQC can be traced to the 1940s with probable maturity by the mid 1970s. Morita, et.al (1986) notes that when the predecessor to Sony Corporation was founded, cofounder Ibuka established the company philosopy by stating that

If it were possible to establish conditions where persons could become united with a firm spirit of teamwork and exercise to their hearts' desire their technological capacity, then such an organization could bring untold pleasure and untold benefits.

The above observations lead to the conclusion that, in terms of the stages of quality in Japan, TQM, in American literature and practice, is largely pre 1965 TQC. There are exceptions, of course. Fortunately, the location of TQM on this timeline is advancing. Berk and Berk (1993) and Gevirtz (1994) provide a scope which begins to approach the scope of TQC.

A major difference between the literature of TQM and the literature of TQC is scope. A second major difference is the degree of implementation. The literature of TQM focuses largely on management and management technique. However, it rarely address the scope denonstrated by Monden (1993). In addition to addressing management and management technique, the literature of TQC incorporates the totality of integrated product and process development, or IPPD, which incorporates engineering process. American TQM, in the large, is at the stage of a fuzzy perception of what quality really is. It has an even fuzzier perception of how and where to implement it. Morup (1992) notes that "Compared with other 'design for X' methods, DFQ [Design for Quality] in the hands of total quality management has suffered from a lack of theoretical basis and limited insight into the nature of design." TQC, on the other hand, has defined quality rather rigorously and moved on into rigorous implementation. From the perspective of competitive advantage, the first challenge for TQM is to holistically define the nature of quality and then rigorously implement a form of IPPD which will attain the defined quality. The second challenge is to move beyond. Until it moves beyond, TQM will not have the competitive advantage.

The team approach to describing the large topic of TQM by Rao et. al. (1996), although it lacks depth, provides the broadest English literature coverage to date. It is, thus, the best candidate for a comprehensive first undergraduate course.

From the perspective of competitive advantage, for many years now, Crosby (1979) has been telling us that "quality is free." Reichheld and Sasser (1990) go even further to give a clear indication of the positive impact of quality on profits for the service industry. Deming (1993) points the way to the positive effects of cooperation and trust. Whitney (1994), building upon Deming's insights and his personal experience, examines the economics of trust, which is a major counter to the detrimental effects of transaction costs, that are generated to protect organizational and personal self interest. Because quality drives both revenue and cost, it is a potent driver for competitive advantage. Understand it, then live it!

References

Berk, J. and S. Berk (1993). Total Quality Management: Implementing Continuous Improvement, Sterling Publishing Co. Inc., New York NY.
Crosby, P. B. (1979). Quality is Free: The Art of Making Certain, McGraw-Hill Book Company, New York NY.
Deming, W. E. (1993). The New Economics for Industry, Government, Education, Massachusetts Institute of Technology Center for Advanced Engineering Study, Cambridge MA.
Gevirtz, C. (1994). Developing New Products With TQM, McGraw-Hill, Inc., New York NY.
Hammer, M. and J. Champy (1993). Reengineering the Corporation: A Manifesto for Business Revolution, HarperBusiness, New York NY.
Mizuno, S. and Y. Akao, ed. (1994). QFD: The Customer-Driven Approach to Quality Planning and Development, Asian Productivity Organization, Tokyo, Japan, available from Quality Resources, One Water Street, White Plains NY.
Monden, Y. (1993). Toyota Management System: Linking the Seven Key Functional Areas, Productivity Press, Portland, OR, USA.
Morita, A. with E. M. Reingold and M. Shimomura (1986). Made in Japan: Akio Morita and Sony, E. P. Dutton, New York NY.
Morup, M. (1992). "A New Design for Quality Paradigm," Journal of Engineering Design, Vol. 3, No. 1, pp. 63-80.
Rao, A., L. P. Carr, I. Dambolena, R. J. Kopp, J. Martin, F. Rafii, and P. F. Schlesinger (1996). Total Quality Management: A Cross Functional Perspective, John Wiley & Sons, New York NY.
Reichheld, F. F., and W. E. Sasser Jr. (1990). "Zero Defections: Quality Comes to Services," Harvard Business Review, Vol. 68, No.5, September-October, pp. 105-111.
Sullivan, L. P. (1986). "The Seven Stages in Company-Wide Quality Control," Quality Progress, May, pp. 77-83.
Whitney, J. O. (1994). The Economics of Trust: Liberating Profits & Restoring Corporate Vitality, McGraw-Hill, New York NY.

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