QUALITY AND RELIABILITY MANAGEMENT

SUMMARIZED ARTICLE

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QUALITY AND RELIABILITY MANAGEMENT
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Contents
Keywords _____________________________________________________ Error! Bookmark not defined.
Abstract __________________________________________________________________________________________ 1
Introduction _____________________________________________________________________________________ 1
Background ______________________________________________________________________________________ 1
Study Purpose ___________________________________________________________________________________ 4
Literature Review _______________________________________________________________________________ 5
TQM Practice in Australia and New Zealand __________________________________________________ 5
Impacts of Quality Practice _____________________________________________________________________ 6
Literature Synthesis _____________________________________________________________________________ 6
Hypothesis _______________________________________________________________________________________ 7
Cross-Sectional Study ___________________________________________________________________________ 7
AMC Survey ______________________________________________________________________________________ 7
Variables _________________________________________________________________________________________ 8
Findings __________________________________________________________________________________________ 8
Conclusions ______________________________________________________________________________________ 9

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KEYWORDS
Organizational performance, Product innovation, TQM, warranties

ABSTRACT
 This journal will help to test the strength of the relationship between TQM and
organizational performance.

 This is an analysis of some manufacturing firms of Australia and New Zealand.

 It has been found that, a company with TQM practice achieves better employee relations,
customer satisfaction, operational performance and business performance, than those
who do not care about TQM.

 Total Quality Management is a very important factor for the long-term success of an
organization.

 TQM focuses on continuous process improvement with an organization to provide

superior customer value and meet customer needs.

 Quality can not be instilled into shop floor without the initiative and the commitment of
top management.

INTRODUCTION

BACKGROUND
 Quality: Fully meeting customer needs and requirements all the time.

 Management: the way we act, operate, control and handle a certain task or firm.

 TQM: A management approach focusing on the improvement of performance

in all functions, departments and processes across the company to provide quality
services which exceed customer expectations.

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 Organizational Performance: It includes strategic planners, operations, finance, legal and
organizational development.

 This is a new philosophy of applying strategies, management practice and organizational

performance.

 TQM is the involvement of everyone in the organization from top management to its
employees.

 TQM focuses on continuous process improvement within organization to provide superior

customer value and meet customer needs.

 TQM begins with the assumption that employees in any organization must co-operate
with each other in order to achieve quality for the needs of the customer.

 TQM processes also depend on a certain set of values and believes shared by all the
organizational members.

 Some scholars have claimed that the effects of TQM practices on various types measures
different. In addition to this, few empirical studies have effects on the relationship
between TQM and organizational performance.

 TQM is a management philosophy that is intended to empower every member of the

organization. It is planned to promote continuous, sustained and long term improvement
in quality, productivity and to eliminate employees fear of change.

 There are four components that are frequently cited as critical to a successful TQM
strategy;

 Customer satisfaction,
 Employee involvement,
 Managerial leadership,
 Process improvement.

 Effective supplier quality management is facilitated by long term, cooperative

relationships with a few suppliers as possible to obtain quality materials and services.

 TQM is a systematic firmwide management for the purpose of improving the performance
in terms of quality and productivity and profitability.

 It creates a quality organization that continuously improves and sustains performance

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STUDY PURPOSE & RESEARCH PROBLEMS
 A lot of work has been done on the TQM practice.

 But a little rigorous research has been done for establishing a link between the TQM and
Organizational Performance.

 The links between TQM and organizational performance have been studied by numerous
scholars namely

 Deming 1986

 Crosby 1979

 Juran 1991

 Feigenbaum 1983

 Earnest’s and Young’s studies concluded that only three quality management practices
have a significant impact on performance regardless of industry type, country or starting
positions. Those three practices are;

 Process improvement methods,

 Strategic plan deployment,

 Supplier certification programs.

 The work that has been lack of Statistical and Methodological strictness and suffer from
small sample sizes.

 Our study will be based on large sample sizes.

 And we will check, If the TQM practice having a positive effect on organizational

performance.

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LITERATURE REVIEW
 A ton of researches have been published in the form of literature.

 Numerous studies are reported in the literature on the link between TQM practice and
organizational performance.
 Deming in 1998 and George in 1991 were awarded by Malcom Baldrige National Quality
Award.
 One of the most rigorous studies on the link between TQM practice and organizational
performance is by Powel in 1995.

 One of the most widely cited studies concluded that three quality management
practices have a significant impact on performance.

 Process improvement method,

 Strategic plan deployment,

 Supplier certification programs.

TQM PRACTICE IN AUSTRALIA AND NEW ZEALAND

The success of TQM in Australian and New Zealand have been mixed.

 We’ve seen a significant impact in the Australian Automobile Industry.

 They have shown us that old businesses can be renewed and can continue to improve
their quality and productivity.

 Automotive is sure that the growth of the manufacturing culture-based Kaizen is the
major reason for the improvements in the car industry.

 Kaizen is a Japanese word for continuous improvements as explained by Imai (1986).

 An AMC’s study (Australian Manufacturing Council) concludes that the TQM is one of the
factors that led towards the improved organizational performance. However, AMC study
is based on simple statistics and it did not strictly test relation between TQM and
Organizational Performance.

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 Sluti (1992) utilized structural equation modeling to study 184 manufacturing firms in the
New Zealand.

 Quality practice has positive impacts on the performance measures for process
utilization, process output and production costs, work-in-process inventory levels and on-
time delivery.

QUALITY PRACTICE IMPACTS ON

 Performance measures for process utilization,

 Process output,

 Production cost,

 Work-in-process inventory levels,

 On-time delivery.

LITERATURE SYNTHESIS
 TQM is a long-term process (5-10 years), to achieve a quality organization.
 TQM is a philosophy that embraces concepts, methods, tools and techniques to form a
language which is understood and applied as a business strategy at the ``top-floor'' and
as a functional strategy at the ``shop-floor.'' This approach assists organizations to
integrate business activities in leadership, people, customer focus, planning, quality
assurance of processes, and information and analysis. These activities when effectively
linked together would lead to sustainable world class performance in customer
satisfaction, employee relations, operating performance and business performance.

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HYPOTHESIS

The following Hypotheses have been developed in our study:

H1: TQM practice has a significantly positive effect on organizational performance

H2: The relationship between TQM practice and dimensions of organizational

performance is strengthened when co-varied for company size.

H3: The relationship between TQM practice and dimensions of organizational

performance is strengthened when co-varied for industry type.

H4: The relationship between TQM practice and dimensions of organizational

performance is strengthened when co-varied for ISO 9000 certification status.

CROSS-SECTIONAL STUDY

 Our analysis uses data obtained by the AMC study (1994).

 The goal for this study is to find the best practice by the Australian and New Zealand’s
manufacturing firms and its impacts on organizational performance.

AMC SURVEY

 The AMC sent questionnaires to 3000 Australian and 1000 New Zealand manufacturing
sites.

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VARIABLES

 Independent variable

There are 40 items(variables) selected those which have good relationship

between them.

These are called as Independent variable.

 Dependent variable

Organizational performance is characterized by 14 dependent variables that

were selected from the AMC survey.

These are those items(variables) which have great impact of TQM on

organizational performance.

FINDINGS

 Testing H1:

Hypothesis H1 is supported for six of the 14 organizational performance

variables: customer satisfaction. employee morale, delivery in full on time,
productivity, cashflow, and sales growth. The other eight hypotheses are rejected.

 Testing H2:

Company size. The strength of the relationship between TQM and defect
rates and TQM and warranty costs changed from insignificantly negative to
significantly negative. Therefore, H2 is supported.

 Testing H3:

industry type. The relationship between TQM and innovation of new products
changed from insignificantly positive to significantly positive. All other
relationships were not affected. Therefore, H3 is supported.

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 Testing H4:

ISO 9000 certification status. The relationship between TQM and the 14
organizational performance variables did not change as a result of the covariate
ISO9000certification. Therefore, H4 is rejected.

CONCLUSIONS

As we have seen in this summarized article, we can conclude that;

 TQM has a very important impact on the customer satisfaction, employee relations,
operational and business performance.

 There are organizations that have achieved good feedback without TQM and also there
are some organizations that cannot make enough profit.

 But based on our findings, it can be concluded that a typical manufacturing company can
achieve better performance in business employee relations, customer satisfaction,
operational performance and business performance, with TQM.

 These Results are consistent.

Submitted by Submitted to

Wondering Minds Ms. Tanya Mushtaq

Information Technology (morn)

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Submitted by

Wondering Minds
Information Technology (morn)

18 Azmatullah

05 Ahsan Sheikh

44 Khizar Farooqui

02 Abdul Moid

111 Ammar Ayoubi

84 Sehrish

46 Marvi

108 Adeela

68 Priya

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