Discuss about the Various Approaches Of Quality Management That Are Practiced In Large Organizations Like Toyota?
In this paper, the various strategies that need to be implemented in Toyota, so as to improve the existing quality management system, have been discussed in details.
a. Definitions of quality
The quality of any service or product provided by a business organization refers to the perception of quantifying the degree of satisfaction that customers have in terms of using the products of the organization or the services of the organization. The key to achieve a high quality in terms of products and service is to design and develop the products being made available to the customers in such a way that the end products are able to meet the expectations of the customers. However, it should be mentioned that quality has no special meaning until and unless it is associated or related to any specific object, product and/ or functionality of the business procedure: quality is nothing but a conditional perception that can be considered as an attribute of an object or product, in spite of being somewhat subjective.
The interpretation of the term quality in context of business kept on changing with time. Thus, the term quality can be defined in various ways, some of which have been described in the following section:
The American Society for Quality defines quality as term that can be used subjectively by each and every other person, depending on the personal definition of the term (Myer, 2003). However, in general, term quality can be thought of having two meanings, when used in technical aspects: on one hand it can be considered as those characteristics of the services and products that have the ability to satisfy the needs of the customers, according to the specifications being provided. On the other hand, quality can also be considered as a product or service which is free of deficiencies.
Peter Drucker defines quality as the utilities that are available to a customer from the purchase of any product or service: and the quantification of quality can be done by gathering the information that how much exactly the customers are willing to pay to avail the utilities (Hunt, 2009).
The ISO 9000 standards define quality as the extent to which a product or a set of services are able to meet the requirements of the customers: where the word requirement is used in a dual sense, to mean the expectation of the customers or their specific needs (International standards desk reference: your passport to world markets, ISO 9000, CE Mark, QS-9000, SSM, ISO 14000, Q 9000, American, European, and global standards systems, 2007).
However, the Six Sigma rule defines quality to be the quantity of defects present in each million of opportunities (Snee, 2010).
The first two definitions mentioned above consider quality to be a subjective attribute used to define an object; only the ISO 9000 and the Six Sigma standards can be used to quantify quality. However, in manufacturing industry, although the designs are developed keeping in mind the specific requirements of the customers, yet each and every product has to pass through various testing phases that aim at eliminating any defective part from being incorporated in a finished product. Thus the Six Sigma standard should be used by Toyota.
b.Processes of inspection and assurance
The movement for developing quality products can be traced back to the 13th century Europe where guilds were being formed for the purpose of quality checking. The Industrial Revolution of the 1800s further emphasized the need of proper quality checks of the products being manufactured and from the early 1900’s, quality practices were being considered as an essential aspect of product development. However, the various standards of total quality management were being formulated only after the Japanese quality movement started post World War II (Wong and Li, 2010).
Various methods are put to use in the process of inspecting products and providing the assurance of quality, some of which have been discussed in the following section.
Quality Planning: This process is used to identify specific quality standards that would be confirmed to while manufacturing a product, besides determining the processes that should be used to satisfy the specifications mentioned in the standards (Chung Sea Law, 2010).
Quality Assurance: the process using which the overall performance of the production system is measured or evaluated, besides providing the assurance that the characteristics of the products will adhere to chosen quality standard is known as quality assurance (Chung Sea Law, 2010). The evaluation of the entire process of production is performed using various tools and techniques, besides the implementation of quality audits.
Quality Control: In this stage, the products and/or services provided by the organization are monitored so as to determine whether they conform to the associated quality standards. Various methods are used for the process of quality control of a product, some of them being Pareto diagrams, statistical sampling, trend analysis etc (McDowall, 2006).
Total Quality Management: TQM refers to the process of implementing various quality improvement strategies throughout all the operational activities of an organization, like that of planning, field testing, designing, training, auditing etc (Steensen, 2010).
The BS 5750 is a British Standard of excellence used in evaluate the process of quality management; it had been originally designed as an engineering standard, but currently is being applied to other industries, like that of hospitality, food and beverages, etc.
The ISO 9002 is model developed by the International Organization for Standardization, so as to assure the standard of quality in the production industry, the installation industry and the servicing industry. These two standards are widely being used by organizations for their quality control processes.
c.Quality management approaches
Edward Deming (1986) was of the opinion that quality should be considered as anything the customer requires or expects from a product or service he or she is paying for (Taggart, 2011). Deming had propagated a Plan – Do – Check – Act (PDCA)” cycle which aims at producing goods and services of high quality to meet the expectations of the customers (Bayes et al., 1963).
Joseph Juran is widely known for his principle of "Quality Trilogy": a process made up of three stages namely planning of quality, improvement of quality, and control of quality (Wood and Wood, 2005, De Feo and Barnard, 2004).
According to Ishikawa, the employees of an organization have a major role in the process of quality control of the organization, keeping in mind that relying overly on the quality o the professionals might reduce the scope improvement (Lighter, Fair and Lighter, 2004). According to this theory, quality control should be implied on the company itself, the management, and the human resources and so on and so forth (Bradley and Thompson, 2000).
According to Phillip Crosby, quality should be defined as the adherence to the requirements of the customers and the prevention of wastage should be considered as the first step towards quality management.
The above mentioned strategies have been compared in the following section:
Definitions of Quality
Control of variation
People and Process
Fitness for use
People and Process
Companywide quality control
Supply – led
Performance and process
Conformance to requirements
Toyota has been experiencing issues on different models of their products for the past few financial years, which indicates that the fault lies somewhere within the operational activities used to design and develop the products. Thus, Ishikawa’s model of quality management should be implemented by Toyota to win back the faith of customers.
Customer satisfaction can be defined as the degree to which the customers feel happy and/ or satisfied with the products or services that they have purchased form an organization. It is generally found that customers feel satisfied when a product or service along with being pocket friendly, meets their specific requirements and delivers all those utilities that have been promised by the manufacturer (Barlow and Møller, 2008).
Any organization can increase the level of customer satisfaction through the application of following strategies:
Providing better information: Providing better and helpful information about the technologies used in the products and/or the services, and their utilities results in raising the level of customer satisfaction (Inghilleri and Solomon, 2010).
Improved quality of products: Providing the customers with goods and services of higher qualities, as compared to the same commodities being manufactured by competitor companies, ensures that the customers will be satisfied with the organization.
After sales services: The availability of high quality after sales services ensures a high level of customer satisfaction.
Presently, most manufacturing organizations provide the details of their products, the various technologies used in these products and the services that are available on the purchase of these products on their official websites. Thus customers have an easy access to all such information, comparing which they can decide on which product or service to choose. Thus, in today’s world of information technology, the only strategy which organizations can move win the competition with their competitors is by providing higher quality products and services (GuÌˆngoÌˆr, 2007).
b.Continuous quality improvement
A continuous improvement process can be thought of s a series of ongoing efforts that aim at improving the products and the services that are being made available to the customers or processes that are used to design and develop such product and services (Chrupcala, Edwards and Spatz, 2015). Such efforts become instrumental in the achievement of "Incremental" improvements over long period of time or achieving "breakthrough" improvements within a stipulated time period. W. Edwards Deming was the first who propagated such a developmental procedure, in which the effectiveness and efficiency of the product and/or service delivery systems are constantly being evaluated and improved based on the feedback available from the customers and the estimation of the condition of the market. This strategy is also known as ‘Kaizen’, a Japanese word which means changing for good (McFadden, Stock and Gowen, 2015).
The kaizen methodology follows sis major steps that can be used to ensure continuous quality improvement (McLean, Antony and Dahlgaard, 2015):
Step1: Discovering improvement potential: Toyota should focus on those small aspects of their operational activities that have a significant effect on the production of cars. Bringing about minor changes in those aspects could result in a major improvement of the entire system.
Step2: Analyze current methods: The processes currently being utilized in the identified operational activities should be critically analyzed.
Step3: Generating ideas: The organization should work on original ideas that could improve the methods currently being used. In the next step, these ideas should be implemented within the scope of a pilot project, and efficiency of the pilot project should be well analyzed before implementing the changes throughout the production system.
c.Value added services:
Added value can be considered as the difference in the value of the raw materials that are used for production and that of the finished product available from the production line. From the marketing point of view, those values that when added to a product creates a brand value for the commodity arte considered to be the added value of that particular service or product.
In general, the brand values of products or services are improved by enhancing the technologies incorporated in the products or services, the designs used, the methodologies used to develop the products and the utilities available from the products or services (Hargitai, 2002).
The values that are added to various products and services are of the following types:
Quality Added Value: Adds use of convince or other desirable characteristics to the product.
Environmental Added Value: Employment of methods and processes that is not harmful to the environment.
Cause-related added value: Products or services that donate a part of the generated sales revenue to some social cause.
Cultural added value: Products that are designed and developed using methods that meet the requirements of customers having distinct cultural values.
Toyota could include such designs or features in their cars that would be beneficial for the disabled people, thus incorporating quality added values to their products. Reducing the amount of waste created by their production system would help in the incorporation of environmental value in their products (Thomas, 2003).
d.Availability of information:
On their official website, Toyota makes available the following types of information (Wang et al., 2005):
The details of all the products that the company manufactures.
The details of the technologies used in the products.
The after sales Quick services available to the customers.
The various authorized service centers and show rooms of the organization
The details of those organizations that would provide financial help to those customers who purchase Toyota products.
The information provided by the organization helps the customers to compare products before purchasing and to collect the details of the showrooms and the other such facilities beforehand.
Effective marketing can be considered as the quality by virtue of which organizations are able to maximize the amount of revenue generated through sale of products. When an organization provides detailed information regarding any product, the customers provide much more attention to it as compared to those products whose detailed information is not released by the manufacturing companies. Customers tend to choose products that have been well-reviewed by others or which have been improved by the manufacturing organization over a period of time. Toyota, by providing such details of their products on their official website is able to draw the attention of the customers towards their products.
Quality measurement can be considered as the process of measuring the level of the quality services that are being made available to the customers of the organization.
The measurement of quality is used in the following ways (Tang, 2005):
Program measurement: Overseeing the major functionalities of the system to ensure that the goals of the program are successfully met with.
Accountability: Providing a demonstration of the goals that have been achieved.
Quality improvement: Improving those aspects of the operational activities that are not functioning according to the requirements of the management.
Reporting Results: Generating internal reports regarding the quality of services provided to the customers.
Quality can be measured using the following methods (Shanmugam, 2007):
Six sigma: is a structured and data defined methodology that is useful in eliminating defects from any process, be it manufacturing or providing services to others. The six sigma methodology can be used in Toyota to eliminate defects from all operational activities of the organization (Ray and Das, 2010).
Statistical Quality Control: is a method of quality control which utilizes various statistical methodologies to monitor and control a process. The Statistical Quality Control would be useful in reducing the defects present in the production system of the organization to a significant extent.
b.Benefits of user and non-user surveys
When a survey is conducted with the aim of questioning only those people who are currently using some product of a specific brand or organization, a user survey is said to be in use. The benefits of a user survey are as follows (Imam, 2014):
Feedback of customer satisfaction: The organization gets an overview of the current level of customer satisfaction.
Tracking changes: By conducting several surveys, the changes in levels of customer feedback can be clearly understood, thus revealing the changes in the requirements of the customers.
Expressing commitment: By user surveys are conducted by organizations, the customers are made aware of the commitment of the manufacture to quality products and services.
ii. Non-User Surveys:
When surveys are conducted with the aim of including the perceptions of those customers who do not use the products of a specific company, the survey is termed as a non-user survey. The benefits of such a survey are (Kenett and Salini, 2011):
Identification of current market trends: Interviewing the non-user groups provide a chance of gaining knowledge about the current trend of the market in terms of utilities and features being made available to the users.
Identification of customer requirements: a non-user survey is able to reveal those requirements of the target customers that are not met by the products being designed and developed by the organization.
c.Methods of consultation
People belonging to certain ethnicity and strata of the society, who have not been included while conducting surveys or have been included in far lesser numbers than others, are often termed as under- represented groups. In general, people belonging to non-native ethnic races and those belonging to families having lower income, form such groups (Nie, 2009).
The government has been providing various aids to the under- represented groups in order to improve the standard of living of these groups. Thus the economic conditions of such groups have improved significantly in the past few years, along with the increase in their capacity of spending. Thus, at this point of time, the under- represented groups are being considered as a target group by various organizations: hence the need to include them in consumer surveys.
The various methods using which such surveys can be conducted are:
Surveys using printed questioners or forms can be used to include under-represented groups in consumer surveys.
Telephonic and/ or Mail surveys: The telephone numbers and the e mail addresses of customers are collected by most organizations these days and can be used to conduct surveys.
Group interviews: Interviewing a group of people can also be used as a survey tool.
Surveys can also be conducted various social media sites.
A procedure, following which the customers can inform the manufacturing organization about the defects present in their products any other grievances regarding the quality of the products, is known as a complaint procedure (Complaints and disciplinary procedures, 2010).
Most companies provide three processes available to the customers, using which they can register any product or quality related complaint to the company: the processes being-
Using the hot-line numbers provided for the purpose of registering complaints
Registering complaints by sending e-mails to those departments who are concerned with the activity of solving such issues
By providing feedbacks on the official websites of the organizations
Among the above mentioned procedures, using the hotline number is that procedure which is most frequently used by customers. When a customer calls such numbers, the representatives of the organization at first listen to their problems and tries to provide feasible solutions. When they are unable to do so, they register the complaint made by the customer and contact those technicians or engineers who they feel would be able to solve the problems (Möller, 2014).
Since Toyota uses latest technologies in their products, any technical problem faced by the customers can only be solved by the authorized technicians of the company. Hence the process mentioned above would be helpful in consulting such a person.
The process using which the higher management of an organization is bale to assess the performance of the company, its strength and weakness and the various sizeable opportunities that are available to the organization are known as the self asse4sment procedures.
Using a self assessment procedure, the management can reveal whether the objectives and goals of the organization are met with or not: it plays a vital role in the process of conducting business in a successful way. It is the primary tool that can be used to reveal the state of health of the organization and to find out those operational activities that need to be improved to meet the goals of the organization.
The various self assessment procedures used by organizations are:
Benchmarking: Organizations often consider various internationally accepted standards to compare their current situations in order to evaluate their state of health.
Internal self-assessment and External agencies: Review committees internal to the organization are often formed to review the various operational activities of the organization. External agencies can also be employed to do the same.
Peer review: assessment groups from organizations operating in similar fields can also be employed for the process of assessment.
b.Importance of communication and record keeping:
A well formed communication system is an essential part of an effective quality management system. In order to measure the efficiency of the quality management system, organizations need to communicate with their customers and stakeholders alike, and then communicate the feedback provided by them to the management so as formulate strategies that would help in meeting the requirements of the customers. Thus, communication forms the backbone of any successful organization.
Record keeping is yet another activity that plays a vital role in the operational activities of an organization. Records about various products are maintained by organizations along with the details of customers, employees, dealers and other stakeholders of the organization. The various strategic decisions taken by the management of the organizations are generally based on the records maintained by the organization.
The communication processes used in large organizations are basically of two types:
Formal: Sending official mails to dealers, stakeholders; conducting official meetings, etc
Informal: telephonic or electronic communication among employees; telephonic communication with customers and dealers, etc.
In an organization as large as Toyota, the information regarding the newly launched products and the stock of old products need to be regularly communicated to the authorize dealers. The management needs to communicate the newly implemented strategies and technologies to the employees from time to time. Organizations also communicate with their customers on a regular basis regarding the feedbacks provided by them and / or the complaints registered by them: the marketing strategies used for branding processes could also be considered as a communication strategy. Last but not the least; the employees are also encouraged to communicate innovative ideas that they feel are potential enough to be practically implemented, to the higher management.
Encouraging the employees to participate in the process of developing tactical strategies is one of the best management policies that have been implemented in Toyota. The organization is known for the active participation of all its employees in various operational aspects that aim at improving the quality and reducing the costs associated with production. Employees are also encouraged to communicate those ideas which they feel would be beneficial to the company. The process of staff consultation makes sure that the employees do not feel pressurized by the decisions taken by the management but actively participate in them.
The various stages of staff consultation have been described in the following section:
Figure: Deming Cycle - PDCA Cycle
As depicted in the Deming cycle, the employees are encouraged to plan a strategy at first and act according to it. After that, the results of the activities are measured and adjustments are made to the strategies: after which the newly found strategies are re-implemented. The cycle is continued until and unless the strategies are discarded or an optimized plan is developed.
d.Modifying Toyota’s existing systems:
In order to improve the quality of services being provided to the customers, most organizations implement a wide range of changes in the way they manage the quality of their products: organizations seriously consider the feedbacks provided by the customers and work on the defects pointed out by them, besides implementing strategies like re-defining ‘quality services’ and redesigning the procedures used to measure the satisfaction levels of the customers and updating the tools that are used to provide high quality services to the customers. Thus, it can be safely said that implementing changes in the process of quality management is essential for improving the system.
In order to improve the existing operation al system, Toyota could implement the following strategies:
Encouraging the employees to provide new ideas and work on them
Providing proper training to the employees and employing skilled employees in the production line
Investing in the production of hybrid cars
Including more non-Asian employees in the higher management
The staff consultation and employment of trained workers will be helpful in maintaining the quality of the products developed by Toyota. On the other hand, hybrid cars are being considered as the future generation of cars and Toyota should invest in the process of developing such cars to avail the advantage of being the first mover in the market. Last but not the least, the incorporation of more non-Asian employees in the top management will help the company in capturing the non-Asian market.
In this paper, an in detailed discussion has been made regarding the Various Approaches Of Quality Management That Are Practiced In Large Organizations Like Toyota, the benefits of such management systems, and the range of quality control methodologies used in general. In the last section of the report, the principle which should be implemented to improve the quality management system at Toyota has been discussed.
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