The International Organization for Standardization defines total quality management, or TQM as “a management approach for an organization, centered on quality, based on the participation of all its members and aiming at the long-term success through customer satisfaction, and benefits to all members of the organization and to society.” There are many benefits of TQM initiatives in terms of quality improvement, increased productivity, greater financial yield and more customer loyalty. However, there are many challenges and disadvantages of a total quality management system.
Demands a Change in Culture
TQM demands an organizational culture that focuses on continuous process improvement, teamwork, quality assurance and customer satisfaction.
The principles of TQM requires a change of attitude to focus on customer needs and a reprioritization of daily operations. It also requires a long-term management commitment and constant employee involvement.
Changing an organization’s culture is a difficult challenge, because culture amalgamates an interlocking set of values, processes, effective communication practices, roles, management processes, goals and assumptions, and is often met with resistance by employees, who view it as a threat to their jobs.
A good start to implementing a TQM would be emphasizing customer expectations to employees and striving to meet them in the most efficient manner possible.
Demands Planning, Time and Resources
If you’re looking for a short-term fix for your business’ quality of products, a TQM system isn’t the answer for you.
TQM implementation takes a few years at minimum, and that occurs only after significant strategic planning, time, long-term resource allocation and unwavering management commitment.
Top management employees have to invest time into teaching a variety of management tools and problem solving strategies to their staff. Without this proper planning, a TQM system will ultimately fail.
High Quality is Expensive
One of the disadvantages of TQM is its expense, so those looking to lower costs might want to try other methodologies. Implementation often comes with additional training costs, team-development and human resources costs, quality control costs, consultant fees and the like.
The system also requires continuous improvement in the form of refresher trainings, business process or machine inspections and quality measurement.
TQM is not suitable for very small companies because its implementation, training and execution costs far supersede its financial gains. It’s mainly used as a competitive advantage for big businesses.
Takes Years to Show Results
TQM is a long-term process that shows results only after years have passed. It requires perseverance, patience, dedication and motivation. Many organizations give up on it after failing to see a higher number of satisfied customers quickly. Organizations that function in highly competitive environments cannot afford the luxury of time.
Another disadvantage of total quality management is its focus on task standardization to ensure consistency. While this makes the production process cohesive across supply chains, it discourages creativity and innovative decision making. It also discourages new ideas that can possibly improve productivity.
Not a Quick-Fix Solution
Many companies lose profitability in their excessive focus on quality. Both Xerox, the and Federal Express suffered significant financial setbacks after winning the Baldrige Quality Awards – awards that recognize quality performance.
According to the book, "Corporate Transformation and Restructuring," two-thirds of companies that embrace TQM fail to experience major performance breakthroughs or improvements in customer satisfaction.
According to an Arthur D. Little survey of 500 companies, only 36% felt that TQM improved their competitiveness.