Tesco's TQM Essay: Implementation And Development Of The System.

Introduction of Tesco

Describe about TQM system used by Tesco, implementation and development of TQM system and TQM implementation success.

 Tesco is the one of largest retail market in UK and the world. It is very renowned for its product and service quality. In revenues Tesco is at second number after Wal-Mart. Tesco started its operation in 1920 mainly in UK and since them it has expanded its operation and now has become one of the world’s biggest retail companies. Over the time to maintain its market share it has continued to add many product and services to its portfolio to satisfy the needs of it customer and to further increase its customer base. It currently deal with the products like food items, groceries, books, cloths, electronic goods and many other daily use items (Saarijärvi, 2013). On the other hand they are also involved n many joint ventures  that provide various kinds of services like financial services, insurance services, internet services etc.

 Tesco also used total quality management to improve its quality of every services and the product it provides to its customer. Through TQM techniques they were able to achieve higher customer satisfaction because the output were error and manage free on such a large scale and it was not possible without using total quality management techniques. Manufacturing was the first sector where these techniques were applied and seeing its effectiveness there it was also followed in the services sector (Leng, 2015). There were many TQM strategies that were being applied in various departments like customer based strategy, management based reward structure, employee based teamwork structure strategy, supplier based and supplier research strategy, process based statistical process control strategy, and process based standardization strategy. And various tools were used to implement this strategy in Tesco. These tools were customer need analysis by using customer surveying and other customer interaction. Leadership changes by changing the leadership structure and communication effectiveness. Empowerment of employee and giving them essential knowledge by cross training, quality circle, quality training and brainstorming.  Checking the supplier standards by implementing supplier certifications, supplier training, and supplier documentation. And using various process based techniques to improve the processes used within Tesco like using just in time technique, lead time reduction techniques, benchmarking, using quality audits, quality assessment and process documenting. And product based strategies used tools like benchmarking, flow product analysis and design of experiment. All these techniques were being implemented and controlled on continues bases so that there is a continuous quality control on the goods and the services being provided by Tesco to its costumer.

TQM system used by Tesco

 Over the time the company had the great emphasis on the quality control so that it can provide quality product and services to its customer and maintain the level of satisfaction and retain them.  They continuously used techniques like quality assurance and quality audits. Quality products and services were only main objective of the company. And they used various strategies to fulfill that objective. Various skilled labors were recruited and there was a weekly meeting in which it was discussed how to improve and maintain the quality level being provided to the customer.

This meeting was held weekly and employee’s reviews were taken on this objective of the company. In addition the company had many policies that were for the quality control. These policies are as follows-

• It was mandatory for all the employees to meet the need of customers at all the time.
• There were policies that controlled the quality of products sold in Tesco of third party and its own. The goods sold must follow some quality standards set by the higher management, suppliers good were inspected so that any defect that is detected can be replaced before it is purchased by any costumer.
• Policies for verification of processes whether the follow certain standards.
• Speed performance objective- whether the speed of processes can be increased.
• The condition of food being provided to be hygienic.
• Cost performance objective- whether the cost of the processes being followed can be reduced at any step.
• Human resource management- Company has policy to continuously train its employees so that they can provide a quality service to its customers, and can solve every query and need of customer at any point of time.

Improving the quality was done in several ways. Tesco sell the product manufactured by Tesco itself and by third party. The company first puts all the products into testing, and various audits were carried out on the products so that to certify that whether the products follow certain standards or not, and if the products don’t follow these standards then they are replaced (Woods, 2014). Hygiene is maintained in the food section. High sensitive and cleanliness is maintained in this section.

So 24/7 skilled labor is being placed there to maintain the decorum of the place. And if at any pint of time customer complains about the place, recommendations are taken and they are made effective within short span of time.

A constant eye is also kept on the expiry of the products both internally produced and outside product, and if any product has reached expiry or has extended its selves time, it is carefully disposed off by the skilled workforce and replaced by a suitable product. Food items like groceries are sold within the premises on daily basis and are replaced on daily basis to maintain the quality levels (Laosirihongthong, 2013). Company’s this policy helps maintain the quality of eatable and satisfy the customers.  Generally the company has the policy that the moment the perishable items like grocery shows some defects, they are removed from the selves and are donated to the households that couldn’t purchase it and where these can be used immediately. So this policy helps the assuring quality.

Quality control method used by Tesco generally has two methods known as inspection and testing and these are carried on both before the production and after the production. Before the product is made, its raw material is under testing whether it follows certain standards and if not then it is replaced with some good one and after the production before placing the product on the selves it is again tested and inspected that whether it follows the set standards (Flapper, 2015). Each and every product placed on the selves is tested at various stages of production.

Implementation and development of TQM system

Whenever the operating in one department is made faster, other department is also affected because it is very important to have a uniform speed for effectiveness. So this information has to be communicated (Walters, 2013). This communication regarding the supply chain for quality output is made by effective information technology system. An effective enterprise resource planning ERP is used to improve the quality of internal and external communication.

It is very important for Tesco to treat their associated and employees with respect and gives them what they deserve. So their policies are very employee focused and much attention is given towards the employee growth. Most of their revenue and profits are dedicated towards rewarding their employees under employee rewarding and compensation system. The organization human resource policies are strategically aligned towards its objectives and mission because it constantly motivate the employees to give their best at their job and satisfy the costumers and bring greater revenue to the company.

Tesco since applying the total quality management has been known for its low cost management. Since there seem to be line internal processes which are very effective provide them competitive advantage to carry their internal operations at a very low cost and provide the services and product to the customer at a good quality at a comparatively less cost than their competitors. Tesco due to their low cost competitiveness has been one of the companies that have been profitable even in the times of recession and most of the UK companies were in losses. So by their low cost policies they have maintained their mass shopping volumes (Jacxsens, 2015).

With the introduction of Total quality management, flexibility also became their main agenda. They also concentrated on providing the new products which they thought were in demand through market research. By concentrating of their internal effectiveness they introduced providing financial services, insurance services and providing houses at a comparative cheaper price (Dora, 2013). They also started providing products like Irish yoghurt, seeing that people have started liking the natural products and are more concentrating on nutrition level, and they also provided the products of daily use like milk, butter and oil and to make the distribution easier and cheaper they started manufacturing it and sold it under the company’s brand name. so over all they really made a very good use of total quality management to encourage their employees, introduce new products, improving their IT infrastructure, improving their internal efficiency and increasing their revenues and profits.

• Before the implementation of total quality management the company was although having high revenues but it was not able to get the complete efficiency both in internal and external processes. And they were constantly focused on reducing the errors and waste materials because it was the main reason of the increased cost incurred by the company. So they wanted to align their processes and their management towards their objective and the mission of the company. To prevent the possibilities of the errors and the waste they adopted various techniques of total quality management like benchmarking, improved IT infrastructure, better human resource policies and improved internal as well external processes. This impacted their whole strategy and their culture and way of doing work (Fernie, 2014). Now more focus was on the improved processes and how the company can provide a better quality to its customers and remain profitable for the time being. Policies were still not at its best before implementation of total quality management and they were not able to explore their peak of efficiency and revenues. Tesco was still going strong within United Kingdom but it was not able to make its mark globally, and was not able to achieve its efficiency.
• During the implementation there was a huge impact on the organization. Almost every process and every policy was re-engineered and people were trained to get the efficiency. There was total makeover of the human resource policies. Human resource management of Tesco really affects the quality of service and products provided to the customer. Company wants that their customers are treated with esteem and respect and there every demand is fulfilled. And most of the revenue was now spending on the training and rewarding the employees. Its information infrastructure was re-engineered (Sezen, 2013). Every process included a great deal of technology within that to het that efficiency and get the work faster and smoother. New products and services were being launched based on the market research and the need identification. Every aspect that can provide quality to the customer was reviewed, like distribution lines, selves placing were strategically thought off (Sherr, 2013). Emphasis was on making the internal operation and communication within the various departments of the organization can be made quicker transparent and easier with the help of technology. A proper quality control measure was taken before any product was placed on the selves. They were inspected and tested and a proper quality standard was set. So there overall change in the processes and strategies make a huge impact in making the processes easier, effective and speedy and Tesco gained huge revenues.
• Making the effective use of total quality management techniques will have a huge impact on the Tesco’s future in terms of revenue and its brand name. Now not only in United Kingdom but globally Tesco is renowned for its operation and operational efficiency (Dervitsiotis, 2014). They have opened new avenue for themselves by providing various new services and products like financial services, insurance services, selling houses, which has a huge potential in future and provided the brand name Tesco has able to make for itself and the reputation it has earned in the marketplace it will hugely impact it revenues in future provided that it constantly goes for the quality and flexibility in its processes and management style so that it maintains its competitive advantage over its rivals.

TQM implementation success

The operations management of Tesco is remarkable but there is scope for further developments and incorporation of sustainable development on an expanded scale. To provide competitive advantage to its goods, it should keep innovating such that the value offered by the goods maintain a benchmark standard. This could shield it with respect to the competition and would help it to maintain its market share (Chandra, 2013). Like by the introduction of RFID, it turned out to be a new order winner amongst its competitors, similarly it should keep on focusing on technological advancements. In the era of disruptive innovations and regular new entrants equipped with new techniques, it is vital to focus on the research and developments. But in the same time, it should be noted that employees are the leaders who would at last implement the technology. Also, there are drawbacks of high technology. So, not only on technology, Tesco should focus on the human resources and keep on training in order to maintain their capabilities. Employees are the pivotal role players who maintain the supply chain management rather than the technology.

As per the recent research by the Tesco, non- food products are the major part of the future developments (Carmignani, 2015). Hence, it is recommended for Tesco to source a wide range of non-food products and to innovate its respective delivery and inventory systems of these products as they would attain a dominant part of the revenues.

Not only offline, Tesco is witnessing a gradual growth in its internet shopping sphere. Although it does not generate the major chunk of revenues, growth in sales are resulting from it. So it accounts for a small but very significant percentage of growth, especially in the international market (Asiah Omar, 2013). Also in the era of internet, there is strong growth and potential in the online market space. So, Tesco should focus on this more strategically such that it could provide a great customer experience in the online grocery shopping and other online retailing. This could help Tesco in international expansion as well.

References

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