IMPACT OF TQM ON ORGANIZATIONAL PERFORMANCE

Impact of TQM on Organizational Performance



Impact of TQM on Organizational Performance

Introduction

Over the last two decades, many studies have described on the implementation of total quality management (TQM) principles and methods in organisations around the world. However, until lately, there have been only a couple of attempts to empirically establish the connection between TQM practice and organisational performance. For demonstration, Zbaracki (1998) investigated value practices and presentation in the room air conditioner commerce, and Wilkinson (1992) analyzed the connection of diverse value practices and performance in the USA, Europe and Japan. Since the look of Wilkinson 's caution note that “More perfected research is vital; otherwise, managers will extend to lack the hard clues connecting quality with the base line”, many studies have described on the connection between TQM practice and organisational performance. For instance, Steingard (1993) studied quality practices of over 500 organisations and resolved that some of the quality practices such as process enhancement methods, strategic plan deployment, and supplier certification programs, have a significant impact on performance regardless of kind of industry and homeland of location. Zbaracki (1993) investigated the impact of TQM enhancement strategies on the performance of 20 US companies that had presented well on the MBNQA in 1988/1989. He discovered a strong connection between TQM practices and organisational performance measured in terms of productivity, profitability, customer satisfaction and worker relations. More lately, Powell (1995) compared the value practices and presentation in constructing firms in the USA and Taiwan, as did Spencer (1994) amidst world-class constructing companies in the USA. Petersen (1999) discovered that the practice of quality as seen by middle managers in Taiwan is distinct from that of the USA. Taiwan's managers outlook customer satisfaction as the major factor in achieving significant enhancement in organisational performance, whereas US managers outlook worker satisfaction as the primary component in achieving significant enhancement in organisational performance. Powell (1995) studied 39 US manufacturing companies and discovered that only the “soft” aspects of quality practices, such as worker firm promise, shared vision and customer focus assisted to organisational performance.

 

Discussion

Several empirical studies have been undertook to establish the connection between TQM practice and organisational performance in the contexts of Australia and New Zealand.(Steingard, 1993, 27) The results of these studies indicate that TQM implementation has had a blended success. For demonstration, Knights (2002) analysed data assembled by the Australian Manufacturing Council (AMC, 1994) for 962 Australian and 379 New Zealand manufacturing companies and discovered a significant relationship between quality management practices and organisational performance. However, the results of these investigations displayed that only a handful of “soft” value management practices have a affirmative relationship with organisational performance.(Steingard, 1993, 27) Since the bivariate correlation coefficients of the quality management practices in both studies were discovered to be high, the conclusion regarding the result of individual practices has to be treated with caution. Kerfoot (1995) studied 184 manufacturing companies in New Zealand, and discovered no conclusive clues of the connection between quality management practices and organisational ...