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TQM and Process Improvement in Xerox and Toyota

Research Proposal · April 2017

DOI: 10.13140/RG.2.2.28163.40480

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Running head: APPLICATION OF TQM AND PROCESS IMPROVEMENT IN TOYOTA
AND XEROX 1

Application of TQM and process Improvement in Toyota and Xerox

Term Project

Team # 3

Juhi Thakkar

Sandra Jimenez

Golden Gate University

Professor Nabil S. Rageh

OP 300

April 10, 2017

TQM IN TOYOTA AND XEROX 2

Total Quality Management – Toyota and Xerox

Introduction

Managing an organization entails the ability to provide rules and strategies which can

enable each member to have a standard goal. Work values, ethics, mission, and vision, as

well as strategic goals, are essential elements which can promote quality service to the

clients and quality management of the organization members. It is through strategic

management approaches that an organization can encourage a very important method of

dealing with long-term goals as well as to provide a strong implication on how groups can

experience the need for a similar objective as members of the team. Thus, the need for total

quality management, an approach which basically deals with long-term goals, is a necessary

method of achieving successful operation, design, and improvement activities for the

delivery of organizational management and client satisfaction.

Total Quality Management (TQM)

By principle, total quality management or TQM is an approach which substantially

deals with customer satisfaction in achieving successful organization goals. All member of

an organization is obliged to follow and participate in improving processes, products,

services, and the culture which they are part of. As a form of productive maintenance, the

ability to reach long-term success is defined through customer satisfaction. As a customer-

focused approach, TQM uses variable elements such as strategy, data, and practical

communication concepts to integrate quality discipline into the culture and activities of the

organization (American Society for Quality 2017).

There are ten primary elements which TQM possesses. These are the following:

a. Customer-focused – TQM delivers the level of quality through customer satisfaction.

Improvement lies in how customers are satisfied with the organization’s product or

services.
TQM IN TOYOTA AND XEROX 3

b. Total employee involvement – all members of the group are expected to participate in

working towards the shared goals. Commitment is one of the employee expectations,

and the management has to provide an environment to cater to this element.

c. Training – this is process thinking and providing contingency strategies if yielded

outcomes are varied.

d. Methodology and tools – this includes the use of models and micro-processes which

are required to define and implement the strategy.

e. Executive management – it is the achievement of the company mission, vision, and

goals. Also known as strategic planning or strategic management.

f. Continual improvement – process improvement is one of the greatest goals of TQM.

It is the element which drives the organization to be analytical and creative in finding

solutions to make the organization efficient and achieve competitive advantage.

g. Fact-based decision making – this is the organization of performance, data, and

performance measures to improve decision-making accuracy.

h. Company culture – effective communication is an essential part of TQM because it

defines the organization’s core values and principles in its operation (American

Society for Quality 2017; Murray 2016).

The approaches or methods used in TQM are the following:

For this paper, two companies will be analyzed regarding the use of TQM in its operation,

design, and improvement strategies and would provide an extensive discussion of the

significance of TQM and its development technique principles in achieving successful

process improvement. The companies are Toyota for the sector of manufacturing, and

Xerox, for service business sector.

TQM IN TOYOTA AND XEROX 4

1. Management responsibility – the management’s responsibility is to provide

commitment, leadership, encouragement, and appropriate support as well as human
processes.

2. Planning – this is the creation of strategy, policy and the evaluation of activities

3. Education and training – this indicates the significance of employee education and
training to change employee behavior and attitudes to contribute to their performance

4. Improvement – the goal here is to have a continuous improvement of products,

processes, and services

5. Process control – controlling processes contributes to the enhancement of the quality

system and product design

6. System approach – the activity of achieving quality through all functional activities
(Vukovic 2007).

Toyota

Company Overview

Toyota is one of the leading Japanese automobile vehicles manufacturers around the

world. Established on August 27, 1937, the company offers vehicle manufacturing as well as

financing in other industries. The company sells its vehicles to a number of 190 countries,

and the primary markets are in Japan, North America, Europe, as well as in Asia (Toyota

Motors Sales USA 2016).

Toyota’s automotive division includes the design, manufacture, assembly, and sales

of passenger vehicles and promotes the integration of automotive industry and technology.

Its subsidiary company, Daihatsu Motors, Ltd. produces and sells compact cars and mini-

vehicles, while Hino Motors Ltd. produces and sells commercial vehicles such as buses and

trucks (Toyota Motors Sales USA 2016).

The brand, Toyota, however, manufactures automotive parts, components, as well as

accessories for its vehicles. In the current market, Toyota sells three kinds of cars: hybrid

vehicles, conventional engine vehicles, as well as full cell vehicles. The product line of the
TQM IN TOYOTA AND XEROX 5

company includes subcompact as well as compact cars, mini-vehicles, mid-size luxury

vehicles, sports and specialty cars, recreational and sports utility vehicles, pickup trucks, as

well as buses (Toyota Motors Sales USA 2016).

Application of TQM in Toyota Automobile Segment

It was found that the automobile segment of the company experiences a problem

which is defined through the product defects through wear in the machines. This issue was

followed by the American practice in operating the machine until it is broken and only calls in

an engineer to fix it. The act resulted in more defective parts as the machine wears down

and lack of productivity ensues within the operation division. And lastly, the issue of worker

confusion in working from one machine to the other is defined as one of the systemic defects

that need an implementation of a strategy and a solution to the problem.

Challenge

The problem in this area is the application and implementation of TQM in the variable

problems which Toyota experiences. The main difficulty is how to implement TQM in its

plants. Because there are problems which are defined according to the operational design of

manufacturing the products, as well as how the workers are treated, it becomes apparent

that the challenge lies on how management and operations should work together in order to

achieve the maximum potential of successful provision of product and service to the client.

As the practice of wearing down the machine before calling in an engineer to fix the problem,

as well as the confusion of workers by making them work from one machine to the other, the

issue at hand rests on the concepts of using training and communications development to

integrate Toyota’s operational division.

The first step is that the company management stopped moving workers around as

much as possible and assigned employees to have responsibility for the individual machines

to prevent the further practice of wearing down the machine before calling in maintenance.

This strategy enables the provision of training and development as well as clear
TQM IN TOYOTA AND XEROX 6

communication as principles of TQM to be applied in the operational unit (Silva et al. 2014).

It is this step that Toyota was able to provide an application of TQM in the human resource

department, which encouraged the management to further expand its use of TQM to the

other problems related to Toyota’s implementation of the strategy.

Success

It is identified that Toyota was able to become the highest quality producer of cars in

the world and has dominated the 1980 import market. Toyota presently experiences success

in the field of manufacturing basically because of the result of integrating TQM in its

management of human resources and operations (Amasaka, 2012).

Process Improvement Principles

The customer-oriented philosophy of Toyota Production System (TPS) provides the

principles which enable the company’s day-to-day practice for many years. It has been

adopted and imitated by many businesses around the world (Amasaka, 2012).

Challenge

The primary problem of TPS is the desired outcomes which the company wants its

production and manufacturing departments to achieve. These results are the following:

provision of highest quality service to customers, to provide equal treatment to workers

through job satisfaction, job security and fair treatment, and flexibility for the company to

respond to the market and achieve profit through cost reduction (Amasaka, 2012).

Success

The use of TPS made it possible for the company to achieve the expected outcomes

and the creation of kaizen, or continuous improvement (Amasaka, 2012). It enabled all

Toyota employees to have a responsibility to follow closely the standardized guidelines

which reflect the mission, vision, goals, and culture which the company strives to maintain in
TQM IN TOYOTA AND XEROX 7

both employee relations and process development. TPS and kaizen proved to create a

healthy relationship with the clients, which have become more satisfied with the service they

received from the company through the years (Amasaka, 2012).

Techniques Used

It is apparent that TPS and the kaizen were used as methods to implement TQM in

the operational management of the company. As kaizen is the heart of TPS, it becomes a

valuable element that promoted training and communication development, as well as

customer-focused management responsibility which defines TQM’s principles and

approaches (Amasaka 2012).

Challenges

The primary problem in using the techniques mentioned above is how to implement

TQM in the systemic problems which Toyota experiences. For instance, job training entails

costs, while the time duration of the training can promote unproductivity in some areas of

operation. Furthermore, the TPS has various expected outcomes that may not become the

consequence of the effect of implementing TQM. Another important element to take note is

how workers have been influenced by the American practice of waiting until the machine

breaks down before calling in maintenance (Amasaka 2012). These are the challenges in

utilizing techniques that help integrate a more fluid and smooth transition of productivity

through TQM.

Success

Upon implementation of the techniques, it is relevant that Toyota achieved success in

the advent of workers’ job satisfaction and taking over responsibility in the machines which

they use to operate in the manufacturing division. It is still reflected in the use of TPS and

kaizen in Toyota at the present conditions of the company (Amasaka 2012).

TQM IN TOYOTA AND XEROX 8

Xerox

Company Overview

Xerox has been known as one of the leading enterprises in the service business

sector. It has offices in over 160 countries around the world and has been working closely

with different companies since the time the company was formed. Xerox is included in

Fortune 500 Company, wherein it has a value of $11 billion. The company delves with global

citizenship, investor relations, and innovation to further create a customer-focused service

for its leading clients. Providing services to small and midsize businesses (SMBs), graphic

communications companies, as well as governmental agencies, educational institutions as

well as businesses (Xerox Corporation, 2017).

Application of TQM in Xerox

The competition in the advent of technology and information archiving and

distribution has increased in the Eighties and resulted in the company’s shrinking market up

to 35%. The company then created a quality improvement plan, wherein progress and

survival of the organization were the goals. It was known as the Benchmarking Program,

which highlighted changes in fundamental processes, rather than on end products, which

enabled product superiority over the company’s competition rivals (Ebner et al. 2016).

Challenges

The benchmarking strategy found out that not all processes are unique to a single

industry and comparisons should not only be limited to Xerox’s competitors. Aside from the

competition and the lack of uniqueness of some processes, an ultimate problem for Xerox in

integrating TQM is the improvement of the distribution system base. The adaptation of

lessons learned from leading operating companies inside and outside the business service

sectors provided a key for Xerox to find a solution in implementing TQM strategies to its

improvement and in its competition.

TQM IN TOYOTA AND XEROX 9

Success

The result garnered from using TQM in the company cut quality problems by two-

thirds, and manufacturing costs were cut in half. Development tasks were reduced by two-

thirds, while direct labor costs were decreased by up to 50%, wherein corporate staff was

minimized to 35% in volume. The benchmarking strategy enabled Xerox to cut budgetary

costs while still maintaining quality improvement in product and service, thus increasing

customer satisfaction (Ebner et al. 2016).

Processes Improvement Principles

The benefit of involving processes in the integration of TQM is based on the end-of-

use collection process for customers, effective use of asset base, reduction of waste to

landfills, and avoidance of raw-material purchases. It all contributed to the sustainability

responsibility which Xerox has been using to its corporate strategy for many years.

Sustainability is a critical issue in Xerox and in its processes, which includes resource

management and energy consumption (Maslennikova & Foley, 2000).

Challenge

The careful employment of sustainability as a corporate responsibility is the primary

difficulty for Xerox. Because it aims to safeguard the organization from losses from the

aggressive competition in the service business and technology department, the company

needs to yield strategies which can promote sustainability as well as keep the company

afloat despite the heavy competition from rising companies. Moreover, customer perception

about the changes in equipment used by Xerox is guided by the quality of products and

service the company provides (Maslennikova & Foley, 2000).

Success

Through these challenges, Xerox created a way to promote product stewardship as

well as integrating customer satisfaction as the first embodiments of its TQM. For instance, a
TQM IN TOYOTA AND XEROX 10

three-year total satisfaction guarantee on the equipment was provided to clients who aim to

combine environmental responsibility and manufacturing processes. Moreover, the use of

recycled materials was also used to integrate the sustainability of the corporate

responsibility. Xerox then restored working order without full reprocessing, which then

products are sold as “Xeroxed serviced,” “second-hand,” and “recondition” (Maslennikova &

Foley, 2000).

Techniques Used

Xerox used benchmarking and sustainability as process development improvement

techniques to initialize TQM into the company. Both are indicative of the changes

implemented in Xerox, from manufacturing equipment with repurposed parts, to branding

and selling the products towards the customers.

Challenges

The primary problem in using these techniques is the need for budget cuts and cost

cutting developments. Another issue is the implementation of recycling parts of the product

(the machines) which then puts the label of ‘second hand’ or ‘reconditioned’ – meaning that

customers may feel unsatisfied that they received a product with repurposed components

rather than having received a brand new equipment.

Success

Xerox was able to eliminate this issue by asserting that products should be evaluated

based on the performance, reliability, life expectancy, and primary output of the products

with remanufactured parts and restored equipment (Maslennikova & Foley, 2000).
TQM IN TOYOTA AND XEROX 11

Conclusion

In conclusion, it is evident that using TQM can reverse the effects of problems

experienced by any company – whether the problem rooted internally through the human

resource or externally through competition and policies. It is important to note that Toyota

and Xerox used and implemented TQM and its techniques to increase the chance of

organizational survival as well as the implementation of improvement. Thus, the successes

achieved by Toyota and Xerox in this analysis shows that, indeed, TQM is a highly valuable

management strategy that can promote development and improvement towards the

successful achievement of company goals.

 TQM IN TOYOTA AND XEROX 12

References

Amasaka, K. (2012). ‘Science TQM, new quality management principle,’ in Kakuro Amasaka

(ed.), Science TQM, new management principle: The quality management strategy of

Toyota. USA: Bentham Books.

American Society for Quality. (2017). What is Total Quality Management (TQM)?. Retrieved

from: http://asq.org/learn-about-quality/total-quality-

management/overview/overview.html. 11 March 2017.

Ebner, K., Urbach, N., & Mueller, B. (2016). Exploring the path to success: A review of the

strategic IT benchmarking literature. Information & Management 53(4), 447-466. doi:

10.1016/j.im.2015.11.001.

Maslennikova, I., & Foley, D. (2000). Xerox’s approach to sustainability. Interfaces 30(3),

226-233.

Murray, M. (2016 August 6). Total quality management (TQM). Retrieved from:

https://www.thebalance.com/total-quality-management-tqm-2221200. 11 March

2017.

Silva, G.M., Gomes, P.J., Lages, L.F., & Pereira, Z.L. (2014). The role of TQM in strategic

product innovation: An empirical assessment. International Journal of Operations &

Production Management 34(10), 1307-1337. doi: 10.1108/IJOPM-03-2012-0098.

Toyota Motor Sales USA. (2016). Out story. Retrieved from: http://www.toyota.com/usa/. 11

March 2017.

Xerox Corporation. (2017). About. Retrieved from: https://www.xerox.com/en-us/about. 11

March 2017.

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