Total quality management (TQM) is a management concept of achieving the best possible results from business inputs and operations. Most companies use TQM to improve customer value and to increase the sales and profitability from goods and services. Different methods may be used for TQM methods, but they will usually include similar steps in achieving company goals.
TQM is a customer-based vision of company management to increase the value of goods and services offered to customers. Companies will collect and review customer data regarding satisfaction on goods and services, current demands for new products and suggested changes for existing products. Developing a customer-focused strategy of improving products and meeting customer needs helps companies achieve high TQM process.
Using the information gathered from their customer-focused strategy, companies will plan their business processes to meet the desires of customers. Changing production materials, correcting product flaws and creating new product features are part of the planning process of TQM. Businesses must understand that product quality is based on the perception of customers; planning and deciding how to achieve this perception are important in TQM.
Once the planning process is complete, management can focus on the actual production process of TQM. Process management includes reviewing products and services to ensure they are consistent in quality standards, to ensure products continue to meet customer needs, and to ensure products are available in all markets. Managers must also review the cost of raw materials and production methods, ensuring that delivering high-quality goods can be done at relatively cheap costs.
TQM is driven by the understanding that no consumer market continues to operate at the same level of demand every year. As the business cycle moves through booms and busts, customers change preference and incomes change; companies must be willing to adjust to these changes to ensure TQM for their products and services. Improving processes to reduce costs, finding cheaper raw materials or reducing labor costs are ways businesses may improve processes to remain competitive.
All aspects of TQM can be achieved only through total participation from all employees of the company. All division and employees must commit to a customer focus and desire to produce the best goods and services to meet consumer demands. Managers must train, educate and develop the customer focus strategy in each employee working in the company. Solid communication lines must also be created between management and employees; this allows the company to react quickly to any issues that affect the TQM process in the company.