Total quality management definition

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What is Total Quality Management?

Total quality management (TQM) refers to the ongoing reduction of process errors and the streamlining of operations. The result is a system that contains few non value-added elements, and which produces results with minimal error rates. These results are gauged from the viewpoint of the customer. A common outcome of a TQM system is increased profits, because a business spends less time and money correcting errors.

When to Use Total Quality Management

There are several situations in which it makes especially good sense to install and operate a total quality management system. They are as follows:

  • Consistently high defect rates or quality issues. When a company experiences recurring product defects or frequent customer complaints, it signals a breakdown in quality control. Setting up a TQM system helps identify root causes, streamline processes, and build a culture of continuous improvement. Over time, this leads to more consistent product quality and improved customer satisfaction.

  • Low employee morale or engagement. If staff feel disconnected from decision-making or lack motivation, it can negatively impact performance and innovation. TQM promotes teamwork, empowers employees to take ownership of their work, and encourages open communication. This inclusive approach can boost morale and create a more committed and productive workforce.

  • Increased competitive pressure. In industries with tight competition, companies must constantly evolve to maintain or grow market share. TQM helps organizations focus on customer needs, reduce waste, and innovate efficiently. By doing so, it enhances competitiveness through improved quality, faster delivery, and better customer service.

  • Rapid growth. When a company scales quickly, inconsistent processes and quality lapses can occur across locations or teams. A TQM system standardizes best practices and ensures quality is maintained as the organization grows. This creates a strong foundation for sustainable and scalable success.

  • Compliance required by industry standards or regulation. Some sectors require strict adherence to quality and safety standards, like aerospace, healthcare, or food production. TQM aligns internal processes with regulatory expectations and provides documentation to prove compliance. It also reduces the risk of penalties or recalls due to non-compliance.

Who Participates in a Total Quality Management Program?

There may be either ad hoc or permanent committees that engage in PDCA cycles (as described below), depending on the situation and management's commitment to overall company improvement. A TQM system draws upon the skills of many employees, making improvement a group effort. This also means that everyone in an organization is held accountable for the results of the system.

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Steps in the Total Quality Management Process

There are four steps in the TQM process, which are continually repeated to achieve ongoing improvements. The steps are:

  1. Plan. Determine the problem that shall be addressed, collect information about it, and figure out the root cause of the problem.

  2. Do. Decide how to fix the root cause, implement the fix, and initiate a measurement system to track the resulting improvement.

  3. Check. Examine the measurement using before-and-after testing, to see if the root cause of the problem has actually been eliminated or at least reduced.

  4. Act. Document and publicize the results of this cycle, and also issue a recommendation regarding the problem to be addressed in the next cycle.

The acronym for these steps is the PDCA cycle.

Advantages of Total Quality Management

There are multiple advantages to having a total quality management program, which are as follows:

  • Improve product quality. The quality of the goods and services delivered to customers is enhanced, which tends to reduce customer turnover and increase customer loyalty.

  • Fewer product defects. A total quality management program results in fewer product defects, which reduces the cost of quality throughout the organization.

  • Reduces overall costs. By increasing product quality, a business can strip out substantial costs relating to product defects. This increases the overall profits of the business, creating more cash flow that can be reinvested in the business or returned to investors.

  • Enhances the brand. When products are sold with very high quality, this enhances the seller’s brand image with consumers, which can lead to more word-of-mouth marketing from satisfied customers.