Question

Provide an overview of the objectives and goals of Total Quality Management

How might the Total Quality Management (TQM) be used in a Supply Chain environment?

Answer 1

TQM (total quality management) is a philosophy that views the entire organization as a combination of different processes and aims to improve the quality of these processes in order to provide improved customer satisfaction and product quality.

This means, when an organization uses TQM, there is an effort to improve quality at every function (marketing, sales, operations, HR, finance, etc) and at each of their sub-functions (or processes).

The primary objective of TQM is

Improving customer satisfaction: TQM aims to achieve customer satisfaction through better process within organization and also better quality of product and services. For example, a customer calling a call center should ideally experience better service year on year.

Improve organization performance: TQM does not only focus on customer satisfaction but the overall performance of the organization. The different functions of an organization needs to be improved under TQM philosophy. For example, an organization with various different functions (that follows TQM) will need to improve their marketing, operations, supply chain, finance and other departments in parallel.

A typical supply chain environment includes the entire supply chain process. This means that the process includes procurement to delivery. Supply chain processes usually have different stages and TQM attempts to improve each of these stages individually and improve their respective performance. For example a typical supply chain process will include

Procurement: TQM can be used to optimize the procurement cycle in order to run the manufacturing with more efficiency. Accurate planning and forecasting can be some of the activities of TQM at this point.

Manufacturing: During the manufacturing phase, the quality management of the product could fall under the purview of TQM. For example, every worker or station could focus on the quality of their work and this could improve the overall quality of the product.

Distribution: Efficient distribution of the product according to geography, season and demand of the market are some of the steps towards the TQM philosophy. Such activities make sure that the organization resources are efficiently utilized and there is minimum waste.

Delivery: The last mile delivery system is where the product reaches the customer. Several activities such as proactive inventory management, routing, demand forecasting etc could help improve the delivery process.

Recycle/return: In case of return or recycle of the product the organization could use a systematic mechanism that could reduce cost of overall reverse logistics.