TQM in Service Sector

Dr Arvind Kalia
 Service Quality defined
• Service quality (SQ), in its contemporary
conceptualisation, is a comparison of
perceived expectations (E) of a service with
perceived performance (P), giving rise to the
equation SQ=P-E. This conceptualistion of
service quality has its origins in the
expectancy-disconfirmation paradigm
 Deming Prize for Quality
• The Deming Prize that is given to
organizations, has exerted an immeasurable
influence directly and indirectly on the
development of quality control/management
in Japan.
• Started in Japan in 1950
• Now available to non-Japanese companies as
well
 Deming Prize for Quality
• The Deming Prize examination does not
require applicants to conform to a model
provided by the Deming Prize Committee.
Rather, the applicants are expected to
understand their current situation, establish
their own themes and objectives and improve
and transform themselves organization-wide
 TQM defined
• As per the Juran Institute, Inc. TQM is the set
of management process that creates an
accountable top management, satisfied
customers, empowered employees, high
quality product with low cost. This leads to
long term sustainability and good economic
return.

Example of Service Advisors at Automotive repair Centers

 TQM defined
• TQM is an effective system for integrating the
quality development, quality maintenance
and quality improvement efforts of various
groups in an organization so as to enable
production and service at the most
economical level which allows for full
customer satisfaction Feigenbaum (1983)
 TQM defined
• According to Oakland (1993) TQM is an approach
to improve the effectiveness and flexibility of
business completely. It is an essential way of
putting the entire process in order at every level
i.e. individual level, department level and the
organization level. As advocated by Tobin (1990),
TQM is the totally integrated effort for gaining
competitive advantage by continuously improving
every facet of the organizational culture.
 TQM defined
• TQM is a total process in which one recognizes
that everyone in the organization contributes
in some form or the other to achieve the end
result i.e. the product. Horwitz (1990)
• TQM is not a destination, but a journey
towards improvement of the process Hunt
(1991)
 TQM defined
• According to Mohanty and Lekhi (2002)- TQM
is a programmatic long-term systems
approach initiated and driven by the top
management to bring about a total culture
change to meet the dynamic needs of the
customer and create a loyal and diversified
customer base.
 TQM defined
According to Kanji et al. (1999) TQM is a process
of continuously satisfying customer
requirements at the lowest possible cost by
harnessing the capabilities of everyone.
Elements of TQM
 Continuous Improvement
• A continual improvement process, also often
called a continuous improvement
process (abbreviated as CIP or CI), is an
ongoing effort to improve products, services,
or processes. ... Improvement in business
strategy, business results, customer, employee
and supplier relationships can be subject
to continual improvement.
 Continuous Improvement
• Some see CIPs as a meta-process for most
management systems (such as business
process management, quality
management, project management,
and program management)
 Continuous Improvement
• W. Edwards Deming, a pioneer of the field,
saw it as part of the 'system' whereby
feedback from the process and customer were
evaluated against organisational goals. The
fact that it can be called a management
process does not mean that it needs to be
executed by 'management'; but rather merely
that it makes decisions about the
implementation of the delivery process and
the design of the delivery process itself
 Continuous Improvement
• A broader definition is that of the Institute of
Quality Assurance who defined "continuous
improvement as a gradual never-ending change
which is: '... focused on increasing the
effectiveness and/or efficiency of an organisation
to fulfill its policy and objectives. It is not limited
to quality initiatives. Improvement in business
strategy, business results, customer, employee
and supplier relationships can be subject to
continual improvement. Put simply, it means
‘getting better all the time’.
 Kaizen
Some successful implementations use the approach
known as kaizen (the translation of kai (“change”) zen
(“good”) is “improvement”). This method became
famous from Imai's 1986 book Kaizen: The Key to
Japan's Competitive Success.
• Feedback: The core principle of CIP is the (self)
reflection of processes.
• Efficiency: The purpose of CIP is the identification,
reduction, and elimination of suboptimal processes.
• Evolution: The emphasis of CIP is on incremental,
continual steps rather than giant leaps.
 Kaizen
Key features of kaizen include:
• Improvements are based on many small changes rather than the
radical changes that might arise from Research and Development
• As the ideas come from the workers themselves, they are less likely
to be radically different, and therefore easier to implement
• Small improvements are less likely to require major capital
investment than major process changes
• The ideas come from the talents of the existing workforce, as
opposed to using research, consultants or equipment – any of
which could be very expensive
• All employees should continually be seeking ways to improve their
own performance
• It helps encourage workers to take ownership for their work, and
can help reinforce team working, thereby improving worker
motivation.
 Determinants of Service Quality
Common TQM practices for service sector include:
• Top management, strategic quality planning,
employee management and involvement,
• Supplier management, customer focus, process
management, continuous improvement,
• Information and analysis, knowledge and
education are important for continuous and
industry-wide improvement (Fotopoulos and
Psomos, 2009)
 Determinants of Service Quality
Further, Talib et al. (in press a, 2011f) identified 17 TQM practices for
service industries based on extensive literature review. They are :

• Top management commitment; customer focus;

• Process management; quality systems; teamwork; communication,
training and education;
• Continuous improvement and innovation; supplier management;
• Employee involvement; information and analysis; benchmarking;
• Strategic planning; employee encouragement; quality culture;
• Human resource management; and product and service design.