Total Quality Management and Theory of C

Total Quality Management
Vol. 17, No. 8, 999 –1020, October 2006
Total Quality Management and

Theory of Constraints Implementation
in Malaysian Automotive Suppliers:
A Survey Result
HILMA RAIMONA ZADRY & SHA’RI MOHD YUSOF

Faculty of Mechanical Engineering, Universiti Teknologi Malaysia
ABSTRACT The automotive industry is one of the most important and strategic industries in the
Malaysian manufacturing sector. It supports a large number of Small and Medium Enterprises
(SMEs). The Malaysian automotive industry, especially the suppliers, must be able to stay
competitive and be in business. In order to be able to achieve the above goals, suppliers should
apply Total Quality Management (TQM) to improve the quality of products and services in
satisfying the customers. Theory of Constraints (TOC) is a systems methodology that has been
developed to assist people and organizations to think about their problems, develop breakthrough
solutions and implement those solutions successfully. TOC can be assimilated into TQM
implementation as a mechanism to assist TQM and to enhance its implementation. This paper
relates to a survey conducted to determine the extent of TQM and TOC implementation in
Malaysian automotive suppliers. A questionnaire was sent to 250 automotive suppliers in
Malaysia. The Statistical Package for the Social Sciences (SPSS) software was utilized to perform
the required statistical analysis of the data from surveys. This paper reports on the findings of the
survey conducted. It was found that Malaysian automotive suppliers have achieved quite a high
level of their quality implementation programs, although most of them are still in the early stage
of implementing TQM. However, there were still problems in their implementation of TQM. It
shows that TOC is still something very new in Malaysian automotive suppliers. Its
implementation is at a ‘low’ level of practice. The findings culminate with conclusions together
with some proposed future research directions.
KEY WORDS : Total Quality Management (TQM), Theory of Constraints (TOC), Malaysian
Automotive Suppliers
Introduction
Since the implementation of ASEAN Free Trade Area (AFTA) agreement in 1992,
competition has become intense between ASEAN countries. Facing this challenge,
the Malaysian automotive industry, as the provider of technological capability and the
Correspondence Address: Sha’ri Mohd Yusof, Faculty of Mechanical Engineering, Universiti Teknologi
Malaysia, 81310 Skudai, Johor, Malaysia. Email: shari@fkm.utm.my
1478-3363 Print=1478-3371 Online=06=080999–22 # 2006 Taylor & Francis

DOI: 10.1080=14783360600747911
1000 H. R. Zadry & S. M. Yusof
generator of inter-industry linkages, must be able to stay competitive and be in business.

The industry should produce products with better quality, cheaper price, faster delivery
and better service to customers, compared to competitors. Total Quality Management is
considered an important catalyst in this context (Ghobadian & Gallear, 1996) with the
objective of increasing the quality of products and services continuously to satisfy the
customers. So, in order to be able to achieve the above goals, the Malaysian automotive
industry, especially the suppliers, should adopt Total Quality Management.
Total Quality Management has been recognized and used during the last few decades by
organizations all over the world to develop a quality focus and improve organizational
performance. In spite of this, TQM implementation is still problematic for many
organizations – especially for Malaysian SMEs, who have been slow to adopt and
implement TQM.
Theory of Constraints (TOC) was first presented in 1984 by Eliyahu M. Goldratt (Goldratt &
Cox, 1984) through his revolutionary book, The Goal. TOC provides the methodology to
define what to change, what should be changed to, and how to effect the change to continuously
improve the performance of an entire system. TOC, like TQM, treats improvement as an
ongoing process. But instead of focusing on localized improvements in all areas, it attacks
the one constraint or bottleneck that limits the system’s performance.
TOC can be used as a vital mechanism to assist the implementation of TQM. It must not
replace TQM, but rather be used in helping the company to find out problems in its
implementation and focus the TQM efforts toward the organization’s goal. TOC is an excel-
lent approach in continuous improvement, but has not much been widely studied. There is
also no research about the use of TOC as a mechanism to assist TQM in Malaysia, especially
the automotive suppliers, which have an important role to play in the Malaysian industry and
economy. A TOC-based TQM approach can be the way forward in the industry.
In the light of this, it is important to determine the extent of TQM and TOC imple-
mentation in Malaysian automotive suppliers, before assimilating TOC into TQM
implementation. Toward this end, a survey was conducted and the SPSS software was
utilized to perform the required statistical analysis of the data from the survey.
Total Quality Management

TQM is a philosophy aimed at achieving business excellence through the use and
application of tools and techniques, as well as the management of soft aspects, such as
human motivation in work (Juran & Gryna, 1980). Berry (1991) defined the TQM
process as a total corporate focus on meeting and exceeding customer’s expectations
and significantly reducing costs resulting from poor quality by adopting a new manage-
ment system and corporate culture. Quality management is a long-term process that
relies on relative achievements through continuous improvement. Successful TQM
implementation can only come from radically challenging and changing the culture of
the organization (Zairi, 1996). Therefore, one may say that TQM is a philosophy,
concept and powerful management approach. It involves management and empowerment
of people in order to create satisfied customers and improve organizational performance.
In order to be successful in implementing TQM, first, one needs to know what critical
success factors of TQM Saraph et al. (1989) defined critical factors as those ‘critical areas
of managerial planning and action that must be practiced to achieve effective quality
management in a business unit’. There are numerous factors to be stressed as facilitators
TQM in Malaysian Automotive Suppliers 1001
for successful TQM implementation. These factors, which are found in the literature, vary
from one author to another. Saraph et al. (1989) provided eight critical factors of quality
management. Black & Porter (1996) developed TQM factors using the Malcolm Baldrige
Quality Award criteria. Ahire et al. (1996) also identified 12 constructs of integrated TQM
strategies. Their instrument is tested and validated only in the manufacturing sector.
Almost all these factors are identified and developed for large firms, with few excep-
tions. Yusof & Aspinwall (2000a,b, 2001) extensively reviewed the literature of TQM
practices of SMEs and studied CSFs (critical success factors) for TQM. This study
adopted the TQM factors developed by Yusof and Aspinwall (1999, 2000c), with minor
modifications to suit the characteristics of SMEs in Malaysian automotive suppliers.
TQM has helped many organizations improve their competitiveness and profit, such as
Motorola, British Airways, Xerox, IBM and Hewlett Packard. These success stories can
be found in various literatures. Although there are many successful case studies of imple-
menting TQM, there are also many failure experiences (Ahire et al., 1996).
Several authors report problems in TQM implementation: low quality standards, failure
to measure quality, lack of incentives for employees consistently to provide quality goods
and services, insufficient commitment by management to implementing quality (Masters,
1996; Radovilsky et al., 1996; Tatikonda & Tatikonda, 1996; Nwabueze, 2001). These
failures can be avoided if the barriers to implement TQM and the problems can be over-
come. Awareness of the barriers and problems should be emphasized when training organ-
izations in TQM concepts and methods. Any organization can benefit from a better
understanding and knowledge of TQM.
Theory of Constraints (TOC)

Different writers have given various definitions of TOC. According to Dettmer (1995), TOC is
a set of concepts, principles, and tools designed to help manage systems better. TOC is also
defined as an example of a management philosophy built upon a limited number of assump-
tions and designed to provide a process of continuous ongoing improvement (Sivasubramanian
et al., 2003). Generally, TOC is a combination of philosophy, concepts, principles, and tools
conceived to maximize the performance of any system by identifying, managing and breaking
the most restrictive limiting factor that constraints system performance.
Rahman (1998) summarized the concept of TOC that every system must have at least
one constraint and the existence of constraints represents opportunities for improvement.
The one main aspect of TOC, which differs from traditional improvement approaches, is
the way it evaluates improvement efforts. Many quality improvement efforts are focused
on achieving the highest cost reductions. The TOC approach focuses on increasing
throughput rather than reducing costs. The TOC has two major components:
1. The five focusing steps of TOC

2. Thinking Process
The Five Focusing Steps of TOC

Goldratt & Cox (1984) has developed five sequential steps to concentrate improvement
efforts on the relevant component. The steps are:
(1) Identify the system constraints (Its weakest links).

(2) Decide how to exploit the constraints.

(3) Subordinate everything else to the above decision.
(4) Elevate the system’s constraints.
(5) If, in the previous steps, a constraint has been broken, go back to step (1), but do not
allow ‘inertia’ to cause a new constraint.
Detailed description of these steps can be found in Goldratt & Cox (1984), Motwani &
Vogelsang (1996), Dettmer (1997), Stein (1997), Rahman (1998, 2002).
Thinking Process
The next important component of TOC is the Thinking Process. Goldratt (1990) developed
the Thinking Process (TP) methodology to address policy constraints and create break-
through solutions using common sense, intuitive knowledge and logic. Managers are
required to make three generics decisions while dealing with constraints: what to
change, what to change to, and how to cause the change. The TP prescribes a set of
five tools in the form of cause-and-effect diagrams to address those questions (Dettmer,
1997). The tools and their purposes are summarized in Table 1.
Theory of Constraints (TOC) is a new concept, which is growing in recognition and
popularity. Some of the literatures have been presented so far has shown that TOC can
complement TQM strongly in helping to focus the parts of a system that need process
improvement (TOC-based TQM) (Simons & Moore, 1992; Gardiner et al., 1994; Ronen &
Paas, 1994; Dettmer, 1995, 1997; Stein, 1997; Fredendall et al., 2002). The principles
of a TOC-based TQM serve as guidelines to help in understanding how to focus efforts
in maximizing profitability through the implementation of TQM. It has the objective to
establish an effective management system designed to implement the process of continuous
profit improvement while meeting the necessary condition of good quality (Stein, 1997).
Based on the above review, the application of TOC-based TQM in an organization can
be a proposed solution in answering the low rate of TQM implementation in Malaysian
SMEs, especially its automotive suppliers. Mabin & Balderstone (2003) have indicated
that the rate of publication on TOC is steadily increasing. The literature contains many
case studies of the application of TOC to manufacturing organizations, but there is no
published article on the topic of TOC-based TQM application to organizations, especially
in Malaysia. Therefore, this study attempts to address this gap by considering the
implementation of TQM and TOC in Malaysian automotive suppliers.
Table 1. Thinking process tools and their roles
Questions Purpose TP tools
What to change? Identify the core problem Current Reality Tree (CRT)
What to change to? Develop simple, practical solutions Conflict Resolution Diagram (CRD)
Future Reality Tree (FRT)
How to cause Implement solutions Prerequisite Tree (PRT)
the change?
Transition Tree (TT)
Study Methodology
The objective of the survey was to investigate the level of TQM and TOC understanding
and implementation in Malaysian automotive suppliers. To that end, a questionnaire was
developed to collect data for this research. In order to achieve the objectives of the study,
the Malaysian automotive suppliers were selected as the population of this study. The
respondents consist of executive directors, managing directors, manufacturing managers,
quality managers, production managers, and planning and development managers, in these
automotive suppliers. They were chosen as the population of the study because they
directly involved in the process, have first-hand knowledge and experience in TQM
implementation.
The questionnaire consists of six parts. The first part investigates the general infor-
mation of the companies participating in the research. This include the size of
company, type of business, quality activities that had been implemented, the certificates
that have been received, and the awards that have been won. The second part of the
questionnaire explores the understanding and practice of the Theory of Constraints
(TOC). The third part of the questionnaire explores the general TQM opinions in
Malaysian automotive suppliers.
The practical level of TQM implementation in Malaysian automotive suppliers was
explored in the fourth part of the questionnaire by using critical success factors of
TQM for SMEs. In this part, respondents were asked to rate two aspects on a five point
Likert scale: first, the level of importance placed on each statement in each critical
factor; and, second, the extent to which they thought it is currently a practice in the organ-
ization. For the perceived importance, the rating scales range from 1 ¼ not important at
all, 2 ¼ not important, 3 ¼ neutral, 4 ¼ important, 5 ¼ very important; while for the
extent of practice was given as 1 ¼ very low, 2 ¼ low, 3 ¼ moderate, 4 ¼ high,
5 ¼ very high. TQM results will be explored in the fifth part of the questionnaire. This
part determines the performance of Malaysian automotive suppliers after implementing
TQM. And the last part of the questionnaire identifies the barriers or difficulties faced
in trying to adopt TQM in the Malaysian automotive suppliers.
The process of developing the questionnaire included a pilot survey, which was used to
modify and eliminate a number of variables, until the final questionnaire was designed.
Experts on the subject were consulted, to ensure that the questions were properly
phrased and suitable. The comments and feedback given were very useful in enhancing,
rectifying, and improving the instrument.
Completing the pilot study successfully enabled the full survey to be launched as
planned. The full survey, through the mailed questionnaire, was carried out within three
months. Since the target participants were focused in the automotive suppliers, the best
available directory to use as a basis for choosing respondents was the Federation of
Malaysian Manufacturers (FMM) Directory (FMM, 2000) and Small and Medium Indus-
try Development Corporation (SMIDEC) Directory (www.smidec.com.my).
Reliability Test
In the case of reliability analysis, Cronbach’s alpha was employed to measure internal
consistency of the research instrument. A reliability test was undertaken to ensure that
the research findings have the ability to provide consistent results in repeated incidences
(Rahman, 2001). The generally agreed upon lower limit for Cronbach’s alpha is 0.70,
although it may decrease to 0.60 in exploratory research (Saraph et al., 1989).
The internal consistency of the elements in the perception of TQM importance (CSFs of
TQM) was tested by using SPSS reliability analysis procedure. The analysis was
performed separately for the items of each factor. First, the factor is accepted if it exhibited
an alpha value greater than 0.70. Then, factors ranging from 0.60 to 0.70 are retested in an
attempt to determine whether the Cronbach’s alpha value could be improved by
eliminating some items. The summaries of the reliability analysis are given in Table 2.
All of the results proved high internal consistency with coefficient alpha 0.70. Thus,
this survey instrument has high internal consistency and therefore reliable.
Validity Tests
Content validity is not evaluated numerically, it is subjectively judged by the researchers.
A measure has content validity if there is a consensus among researchers that the instru-
ment includes items that covers all aspects of the variable being measured (Hair et al.,
1998). For this study, the items included in the survey instrument have been developed
based on both an exhaustive review of the literature and detailed evaluations by
academics, practicing managers, and consultants. There were nine questionnaires that
were sent out in a pilot survey and the response rate was almost 78%, revised by 4
academics, a firm manager, and a quality consultant. Thus, it is believed that this research
instrument has content validity.
A measure has construct validity if it measures the theoretical construct or trait that it
was designed to measure. The construct validity of each Critical Success Factors
(CSFs) was analyzed by using SPSS Data Reduction-Factor analysis procedure,
varimax option of orthogonal rotation was used to maximize a variable’s loading on
a single factor. Items that did not have a strong correlation (item loading lower than
0.30) with the factor were eliminated. In addition, those factors with eigenvalue
lower than 1.0 were eliminated as well. The results of factor analysis are provided
in Table 3.
From the results obtained, all factors are uni-factorial and none of the items factor was
removed. Having conducted this analysis, the research instrument had been validated for
construct validity.
Table 2. Internal consistency test results-CSFs of TQM
No. of Alpha Items for Alpha if item

Factor Description items value deletion deleted
F1 Management Leadership 6 0.8346 None 0.8346

F2 Resource Management 5 0.9012 None 0.9012
F3 Measurement and Feedback 5 0.8269 None 0.8269
F4 Continuous Improvement 4 0.8666 None 0.8666
F5 Supplier Quality Management 5 0.8705 F5.2 0.8732
F6 Systems and Processes 4 0.9179 None 0.9179
F7 Education and Training 4 0.8388 F7.1 0.8793
F8 Work Environment & Culture 4 0.7764 F8.4 0.8715
Table 3. Construct validity test results-CSFs of TQM
Eigen %variance Items for Item loading

Factor value explained deletion range
F1. Management Leadership 3.285 54.753 None 0.645– 0.802

F2. Resource Management 3.637 72.734 None 0.799– 0.879
F3. Measurement and Feedback 2.983 59.651 None 0.688– 0.879
F4. Continuous Improvement 2.869 71.717 None 0.804– 0.894
F5. Supplier Quality Management 3.343 66.869 None 0.692– 0.870
F6. Systems and Processes 3.217 80.421 None 0.851– 0.959
F7. Education and Training 2.752 68.795 None 0.646– 0.894
F8. Work Environment & Culture 2.572 64.293 None 0.523– 0.944
Survey Results
A total of 250 questionnaires distributed with 32 being returned completed. One of the
32 returned questionnaires was incomplete, resulting in 12.4% valid response rate.
Action was taken to increase the response rate by sending a follow up letter to
remind the companies to respond to the survey, but this still did not improve the response
rate.
According to Othman et al. (2001), this response rate is not different from other surveys
in Malaysia, which tend to obtain a response below 20%. One of these surveys is the
research done by Ahmed & Hassan (2003) with a response rate of 11.15%. This response
rate is also satisfactory since accessing the managers is usually difficult.
Background of Respondents
The first aspects to be investigated were the general background of the respondents, such
as the job position of respondents in the company, company size, company ownership, and
length of time involved in TQM, the certification and the awards received.
The respondents to the survey were mainly the Chief Executive Officer (CEO), General
Manager/Director, and Quality Manager of the companies as all the letters were addressed
to them (Table 4). They were selected because they are directly involved and have first
hand knowledge and experience of quality implementation program in their companies.
Figure 1 shows that the respondents were mostly of small and medium sized companies.
Respondents from small-sized companies, defined in this study having less than 50
full-time employees, totaled 12.9%. This is followed by medium-sized companies
(48.4%) –those having 50 to 300 full-time employees. Large companies having more
than 300 full-time employees, constituted 38.7% of the total. In short, SMEs represented
61.3% of the total percentage of respondents, with the remainder being large companies.
Besides the number of employees, respondents are also asked about the ownership of
the companies. As can be seen in Table 5, it shows that majority of the respondent com-
panies are owned by Malaysian (54.8%). Meanwhile, 35.5% of the companies are joint
venture companies, and the remaining 9.7% are fully foreign owned. Because the
owners of the respondent companies are mostly local, they are representative in answering
the objectives of this study to find out the level of TQM and TOC implementation in
Malaysian automotive suppliers.
Table 4. Position of respondents in the company
Position in the company Frequency Percentage (%)
CEO/ GM/ Director 7 22.6

Engineering Department Manager 0 0.0
HRD Manager 1 3.2
QA/QC Manager 18 58.1
Production Manager 0 0.0
Others 5 16.1
Total 31 100.0
The next question in this survey investigated the number of years respondent companies
involved in TQM. This question can indicate the experience and maturity of the companies
on quality matters. In fact, 35.5% of the companies have been involved in TQM less than 3
years and 45.2% of them have been involved for 3 to 6 years. Only 19.4% of them have
more than 6 years’ experience (as shown in Table 6). Since 64.6% of companies have been
involved in TQM for more than 3 years, it indicates that the companies have had quite
good experiences in TQM. So, it is believed that the respondents can give appropriate
answers to the questionnaire.
With regards to quality system certification, all of the respondents had at least one
certification in placed (see Table 7). When examining the results in more detail, it was
Figure 1. Background of Respondents: Company Size

Table 5. Company ownership
Company ownership Frequency Percentage (%)
Local 17 54.8
Joint Venture 11 35.5
Fully Foreign 3 9.7
Total 31 100.0
found that 38.7% are certified to QS 9000. It is quite surprising that only about 38.7% of
the respondents have the more stringent QS 9000 even though it has almost become a
requirement for companies involved in the automotive industry. About 58.1% were
certified to ISO 9001-2000, 6.5% certified to ISO 9002-2000, 32.3% certified to ISO
14001, and 35.5% certified to other types quality certification, most of them are ISO TS
16949, which is the more advanced certification system.
Some studies have indicated that ISO 9000 registration is a useful step towards imple-
menting TQM (Meegan & Taylor, 1997; Quazi & Padibjo, 1998; Tsiotras and Gotzamani,
1996; Agus & Abdullah, 2000; Al-khalifa & Aspinwall, 2000). According to Agus &
Abdullah (2000), the ISO certification process can be used as an opportunity to link
quality assurance and process improvement within a TQM framework. TQM implemen-
tation can improve the efficiency and effectiveness of processes, while compliance with
ISO 9000 can minimize variability and control the processes that have been improved.
Besides quality system certification, the companies are also asked about quality awards
achieved by them. As can be seen in Table 8, more than half the respondent companies
have won at least one quality award; there are 45.8% of the respondents that have
never won one. This indicates that these companies have achieved quite a high level in
their quality program.
Quality Initiatives Implemented

In an attempt to discover whether the respondent companies had actually embarked on a
TQM program or not, a question was included which required the companies to indicate
what quality activities they had already implemented from a list of major initiatives. The
results are presented in Table 9.
As can be seen, the initiatives implemented by the majority of the respondent companies
were the setting up of a quality department (90.3%), development of a quality system
(87.1%), and employee involvement to improve quality (87.1%). The ranking of these
initiatives produced expected results. It is surprising to find that there are still companies
Table 6. Number of years involved in TQM
Company ownership Frequency Percentage (%)
Less than 3 years 11 35.3

3 to 6 years 14 45.2
More than 6 years 6 19.4
Total 31 100.0
Table 7. Number of companies certified to quality system standard
Quality certification No. of companies Percentage (%)
QS 9000 12 38.7
ISO 9001-2000 19 58.1
ISO 9002-2000 3 6.5
ISO 14001 10 32.3
Others 9 35.5
None 0 0.0
Note: Some companies have more than one certification.
that had not set up of a quality department. A quality department is important as a means
for further commitment to total quality and to make the CEO aware that quality exists
within an organization, especially for small companies. Without quality department, it
is questionable how a company can effectively manage quality.
The three least implemented initiatives were a supplier involvement program (54.8%),
business processes improvement (54.8%), and cultural change program (32.3%). This
finding concurs with other survey findings, such as Yusof (2000), which conducted
study among UK companies, and Chang (2002), which developed a Six Sigma framework
for SMEs to achieve total quality. They found the same three least implemented initiatives
with these study findings.
The results are understandable because the level of cultural change is usually immeasur-
able and the program is much more difficult to implement than others. Further, for an
organization, even supplier involvement is essential to business success but complicated
to achieve and manage. In addition, seven of the respondent companies (22.58%) had
implemented all ten initiatives listed and 77.42% of them had implemented more than
six of the ten initiatives listed. It indicates that the quality management programs in the
respondent companies (automotive suppliers) are quite advanced and mature.
Theory of Constraints Understanding and Practices

Another important aspect investigated in this survey was the level of the Theory of
Constraints understanding and practices in Malaysian automotive suppliers. Figure 2
shows that only 35% of the respondents know about TOC, the remainder 65%, have
never heard about it before.
Table 8. Number of companies have won quality award
Quality award No. of companies Percentage (%)
State Quality Award 2 6.5

Industry Excellence Award 3 9.7
Quality Management Excellence Award 3 9.7
Others 9 29.0
None 14 45.8
Note: Some companies have won more than one quality award.
Table 9. Quality Initiatives Implemented
Quality initiatives Frequency Percentage (%)
Setting up of a quality department 28 90.3

Development of a quality system 27 87.1
Employee involvement to improve quality 27 87.1
Customer satisfaction initiatives 26 83.9
Establishing measures of quality progress 25 80.6
Applying Statistical Process Control 23 74.2
Developing strategies for total quality 18 58.1
Supplier involvement program 17 54.8
Business processes improvement 17 54.8
Cultural change program 10 32.3
Even though the respondents indicate that they have knowledge about TOC, only
19.35% of them have actually implemented it. All of these respondents are in medium
and large companies; there are no small companies (see Table 10).
When exploring the results in more detail, it was found that the level of TOC Thinking
Process implementation is still at a ‘low’ level of practice. This can be seen in Table 11
where the mean values of the level of TOC Thinking Process implementation range
from 2.00 to 2.63. The Current Reality Tree (CRT) followed by Prerequisite Tree (PT),
and Future Reality Tree are the tree most implemented tools.
The above results indicate that TOC is still something very new in Malaysian automo-
tive suppliers. There are many companies, which do not have knowledge about TOC.
Figure 2. Percentage of Companies Know about TOC

Table 10. Number of companies implemented TOC
Implemented TOC No. of companies Percentage (%)
Small 0 0
Medium 4 12.90
Large 2 6.45
Total 6 19.35
Some of them have only recently heard about TOC, and have not implemented it yet in
their companies.
Level of Understanding and Knowledge on TQM

One of the reasons of the TQM failures in implementation is the low level of under-
standing and knowledge on TQM. In order to investigate the level of understanding and
knowledge about TQM in general, ten statements were presented, ranging from the philo-
sophy of TQM, through the techniques to cultural aspects. The respondents were asked to
indicate their level of agreement with each one on a scale of 1 to 5. Table 12 shows the
mean score from the highest to the lowest rank.
From the results obtained, there are obviously evident that:
. Teamwork and participation are important for achieving a continuous improvement

culture
. Management leadership, commitment, and support determine the success of new
change initiatives
. A work environment, which is conducive for improvement, is created through manage-
ment-worker partnership.
On the other hand, the least important issues are:
. TQM aims to make customer satisfaction as the focus of a business

. Training and education are vital elements with respect to TQM implementation
. Statistical techniques (such as Statistical Process Control, Design of Experiments, etc.)
are important to ensure consistency of product and process quality
. Supplier involvement is vital in supporting quality improvement.
Table 11. The level of TOC thinking process (TP) implementation
TOC TP Mean Rank
Current Reality Tree (CRT) 2.63 1

Conflict Resolution Diagram (CRD) 2.00 4
Future Reality Tree (FRT) 2.13 3
Prerequisite Tree (PT) 2.38 2
Transition Tree (TT) 2.00 4
Note: The total number of companies implemented TOC TP ¼ 8 companies (N ¼ 8)

Table 12. Mean score for the level of understanding and knowledge on TQM
No. Statement Mean
1. Teamwork and participation are important for achieving a continuous 4.55

improvement culture.
2. Management leadership, commitment and support determine the success 4.48
of new change initiatives.
3. A work environment, which is conducive for improvement, is created 4.48
through management-worker partnerships.
4. Management must provide adequate resources in every aspect of the 4.42
business.
5. Initiatives such as Kaizen, suggestion schemes, quality circles, etc. will 4.36
motivate employees to participate in quality improvement.
6. TQM is a management philosophy and practice to ensure effective and 4.35
efficient use of all available resources.
7. TQM aims to make customer satisfaction as the focus of a business. 4.29
8. Training and education are vital elements with respect to TQM 4.29
implementation.
9. Statistical techniques (such as Statistical Process Control, Design of 4.29
Experiments, etc.) are important to ensure consistency of product and
process quality.
10. Supplier involvement is vital in supporting quality improvement. 4.16
In a way, the results imply that even organizations have recognized teamwork and
participation are important for achieving a continuous improvement culture, they still
lack training and education as the important elements to support and build good
teamwork and participation. Supplier involvement is also vital in supporting quality
improvement. It is said that 50% of a company’s non-conformances are caused by defec-
tive purchased material (Lascelles & Dales, 1989, as quoted in Mehra et al., 2001). There-
fore, it is crucial to have a mechanism that ensures a good incoming quality from suppliers.
By investigating the level of understanding and knowledge about TQM in Malaysian
automotive suppliers, the respondent companies can be ranked into three levels based
on the score (see Table 13). The higher the score, the better the level of understanding of
TQM. The overall mean of these ten statements scored by respondents was about 44 points.
The first level (Level A) is assumed if the company had very good understanding and
knowledge about TQM. It comprised about 16.13% of the respondents with a score at
least 49. Level B is company with scoring between 39 and 48 (+1 standard deviation
from the mean). Level B’s companies (77.42%) had an average understanding and knowl-
edge of TQM. The remaining 6.45% respondent companies with a score below 39,
assumed to have a low understanding and knowledge of TQM (Level C).
From the above results, it can be concluded there are a few of the Malaysian automotive
suppliers who appeared to have a very good understanding and knowledge of TQM.
Total Quality Management Results

The responses regarding the results that the companies believed to have after imple-
menting TQM are presented in Table 14. The mean score of each statement indicates
the degree to which companies witnessed it as a result of the TQM implementation,
from (1 ¼ strongly disagree, 2 ¼ disagree, 3 ¼ neutral, 4 ¼ agree, 5 ¼ strongly agree).
Table 13. Score of understanding and knowledge on TQM
Level of Score (Out of No. of Percentage Percentage of

company possible 50 points) companies (%) each level (%)
A 50 3 9.68
49 2 6.45 16.13
48 3 9.68
47 1 3.23
46 1 3.23
45 3 9.68
B 44 3 9.68
77.42
43 2 6.45
42 4 12.90
41 3 9.68
40 2 6.45
39 2 6.45
C 36 1 3.23
6.45
31 1 3.23
Total 31 100.00 100.00
The results prove that the most important results after implementing TQM in the
companies are improvement in customer satisfaction, reduction in the number of customer
complaints, and developing a culture that emphasizes quality. These results support
the main objective of TQM to meet customer requirements and satisfy them. The improve-
ment of customer satisfaction, according to Antony et al. (2002) is one of indication the
successful implementation of TQM in the organization.
The development of quality culture is very important for the success of TQM programs.
It is good to find that the respondent companies have developed a culture that emphasizes
quality, because to change a culture in an organization is a hard process and cannot occur
quickly (Montes et al., 2003).
An increase in employee satisfaction and involvement, and the reduction in employee
turnover are the lowest results of TQM implementation in this study. Even though they are
Table 14. Mean score for TQM results
Statement Mean Rank
1. Customer satisfaction has shown improvement. 3.8065 1

2. The number of customer complaints has decreased. 3.7419 2
3. Our company has developed a culture that emphasizes quality. 3.7419 2
4. The numbers of products/service defects, errors, or failures found by the 3.7097 3
customer have decreased.
5. Our financial results have been improving. 3.7097 3
6. Our quality program has improved our business performance in general. 3.7097 3
7. Partnership with suppliers has improved quality of purchased parts. 3.7097 3
8. The number of employees participating on quality teams has increased. 3.6774 4
9. Employee satisfaction has increased. 3.4839 5
10. Employee turnover has decreased. 3.2903 6
the lowest, the difference between their mean values with the highest one is quite small.
Employee satisfaction and involvement can be improved further by ensuring everyone
within the organization has a clear understanding of what is required and how their pro-
cesses relate to the business as a whole.
Perception on Barriers to TQM

It could be expected that Malaysian automotive suppliers still face particular difficulties in
implementing TQM. In order to explore the barriers faced by the companies in implement-
ing TQM, respondents were asked to submit and rank what they felt were the greatest
problems or issues they experienced. The results are shown in Table 15. From the table,
it can be seen that the highest barrier to TQM the respondent companies faced is resistance
to change. It is followed by lack of understanding and costly consultancies, training
programs.
These results are understandable because it is very difficult to change the quality culture
of the company and convince everybody of the usefulness of the necessary changes.
Serious problems will possibly arise when the employees cannot commit themselves to
the processes that they do not approve of. Some of them react negatively because they
feel threatened and uncomfortable with the change. So, it requires great effort from the
management to develop the whole company quality culture.
It is also understandable that lack of understanding is one of the tree highest barriers in
implementing TQM –because 61.3% of the respondents are SMEs. A survey conducted by
Abd. Rahman et al. (2002) identified that one of the main difficulties facing by Malaysian
SMEs is inadequate knowledge and understanding of quality. The reason is in line with
this study results, which found that only 16.13% of the respondent companies had very
good understanding and knowledge of TQM.
The barrier of costly consultancies and training programs is probably due to lack of
financial resources. Ghobadian & Gallear (1996) argued that the extent of training in
SMEs is limited because of financial constraints. Ahire & Golhar (1996) also reviewed
Table 15. Mean score for perception on barriers to TQM
Barriers to TQM Mean Rank
Resistance to change (Too busy). 3.77 1

Lack of understanding. 3.61 2
Costly consultancies, training programs. 3.55 3
Lack of preparation (No budget, no sponsor). 3.48 4
Lack of vision. 3.48 4
Lack of systems and structures for TQM activities. 3.48 4
Availability to training. 3.45 5
Lack of rewards and recognition. 3.45 5
Lack of effective measurement criteria. 3.39 6
Lack of evaluation procedures and benchmark indices. 3.29 7
Lack of customer focus. 3.26 8
Training with no purpose. 3.26 8
Lack of top management commitment. 3.19 9
Lack of resources. 3.19 9
one of the weakness of SMEs – lack of capital – which so it may limit SMEs from
investing in high quality processes. These are some of the barriers that hinder SMEs pro-
grams in quality efforts, and they must be addressed if quality results are to be achieved.
Results of Critical Success Factors (CSFs) of TQM

This section presents the results of the CSFs of TQM in Malaysian automotive suppliers.
Having conducted the level of understanding and knowledge on TQM, the various means
for the perception of importance and practice were analyzed. The overall mean for each
factor was obtained to look at the level of importance and practice perceived by respondents.
Perception on Importance
The first item investigated is on the level of importance TQM CSFs perceived by respon-
dents. Table 16 presents the overall mean for each factor. The mean values range from
4.0645 to 4.2500, which is at the ‘important’ level. The two highest critical success
factors are Systems and Processes (4.2500) and Work Environment and Culture (4.2177).
On the other hand, Supplier Quality Management (4.1355) and Resource Management
(4.0645) are the two least important critical success factors perceived by respondents.
Extent of Practice
The next item investigated was the extent of practice of each of the eight CSFs. Table 17
shows the respondents’ overall mean values on extent of practice for the eight CSFs. The
mean values ranges from 3.5935 to 3.8200, which correspond to a ‘moderate’ to ‘high’
level practice on the Likert scale. It can be seen that the two highest critical factors
practiced by the respondents were Measurement and Feedback (3.8200) and Management
Leadership (3.7043). On the other hand, Education and Training (3.6048) and Resource
Management (3.5935) were the two least practiced factors.
Table 16 and 17 indicates that Measurement and Feedback is one of the highest TQM
CSFs both in term of importance and practice. The results also show that Resource
Management indicated by the respondents as the least critical success factor in term of
importance and practice. In short, the survey results show that the respondents’ perception
on importance of TQM CSFs is the same as on practice.
Table 16. Mean importance – overall Results
Factor Description Mean Rank
F6 Systems and Processes 4.2500 1

F8 Work Environment and Culture 4.2177 2
F3 Measurement and Feedback 4.2129 3
F7 Education and Training 4.1935 4
F1 Management Leadership 4.1613 5
F4 Continuous Improvement 4.1613 5
F5 Supplier Quality Management 4.1355 6
F2 Resource Management 4.0645 7
From the above results, it can be seen that overall mean of practice is lower than that of
importance. This is probably due to the companies’ failure to translate what they perceived
to be important into practice. All of the CSFs indicate they might show significant differ-
ence between perception of importance and practice. The statistical comparison to test
whether there was significant difference between the perception of importance and prac-
tice will be discussed in coming sections.
In summary, these survey results show that respondents’ perception of importance and
practice on the CSFs were consistent. On overall, the respondents have ‘important’ level of
perception on the importance on the CSFs; however, in terms of practice, the level was
from ‘moderate’ to ‘high’. These results show that there is still need for more efforts to
be focused on improving the practices, especially the human resource management and
education and training, in order for TQM to flourish.
Hypothesis
Difference of Perception on Importance and Practice of the CSFs
The preceding section described the means of the eight CSFs for TQM implementation.
From the results, it was shown that, overall, the respondent companies have high
degree of perception of importance on most of the factors; however, the extent of practice
was generally lower. In an attempt to find out whether there are any significant differences
between the level of importance and the extent of practice of the eight CSFs, hypothesis
testing was carried out.
The following hypothesis was formulated for conducting the significant test for the
respondent companies:
H0: m1 2 m2 ¼ 0, i.e. there is no significant difference between the importance and

practice means.
H1: m1 2 m2 = 0, i.e. there is a significant difference between the importance and
practice means.
The paired comparison t-test by using SPSS – Compare Means Procedure was
employed for analyzing the test. The results in Table 18 show that the p-value of the
eight CSFs are lower than 0.05 (i.e. significant level); hence the null hypothesis was
rejected. In short, it can be concluded that there was a significant difference between
perceived importance and the extent of practice by the companies on all factors.
Table 17. Mean practice – overall results
Factor Description Mean Rank
F3 Measurement and Feedback 3.8200 1

F1 Management Leadership 3.7043 2
F8 Work Environment and Culture 3.7016 3
F6 Systems and Processes 3.7000 4
F5 Supplier Quality Management 3.6968 5
F4 Continuous Improvement 3.6944 6
F7 Education and Training 3.6048 7
F2 Resource Management 3.5935 8
Table 18. Paired sample statistics for mean importance and practice
Mean Mean
Factor Description importance practice tcalc. p-value Results
F1 Management Leadership 4.1613 3.7043 6.256 .000 Sig.

F2 Resource Management 4.0645 3.5935 4.830 .000 Sig.
F3 Measurement and Feedback 4.2129 3.8200 3.108 .004 Sig.
F4 Continuous Improvement 4.1613 3.6944 4.342 .000 Sig.
F5 Supplier Quality Management 4.1355 3.6968 4.050 .000 Sig.
F6 Systems and Processes 4.2500 3.7000 4.717 .000 Sig.
F7 Education and Training 4.1935 3.6048 4.966 .000 Sig.
F8 Work Environment & Culture 4.2177 3.7016 4.285 .000 Sig.
Note: tcritical value at 0.05 level of significance with 30 degree of freedom ¼ 1.960
Comparing to other studies (Yusof, 2000; Deros et al., 2004), the difference of percep-
tion on importance and practice of the CSFs in this study gives the same result. All of the
CSFs indicate they might show significant difference between perception of importance
and practice. This is probably due to the companies failure to translate what they perceived
to be important into practice. It means the companies know the importance of TQM
factors, but have failed to accomplish them.
Difference of TQM Practice based on the Company Size

This second hypothesis test involved one-way ANOVA to compare the means of TQM
practices between small, medium, and large companies. In order to conduct the test, the
following hypothesis was set up:
H0: m1 2 m2 ¼ 0, i.e. there is no significant difference between small, medium,

and large companies on the practice means of TQM CSFs.
H1: m1 2 m2 = 0, i.e. there is a significant difference between small, medium, and
large companies on the practice means of TQM CSFs.
The results in Table 19 show that there is no significant difference between small,
medium, and large companies on the practice means of TQM CSFs. That this is probably
due to many of them having less than 6 years’ experience in TQM. They are still in their
infancy stage of getting used to the idea of TQM in their companies.
Difference of TQM Barriers based on the Company Size

This hypothesis test compares the means of TQM barriers between small, medium, and
large companies by using one-way ANOVA. The following hypothesis was formulated
for conducting the test:
H0: m1 2 m2 ¼ 0, i.e. there is no significant difference between small, medium,

and large companies on the means of TQM barriers.
Table 19. One-Way Anova Test Results on TQM Practice for Small, Medium, and Large Companies
Small Medium Large

mean mean mean p-
Factor Description practice practice practice F value Results
F1 Management Leadership 4.1250 3.6333 3.6533 1.415 0.260 Not sig.

F2 Resource Management 3.8500 3.4800 3.6500 0.635 0.537 Not sig.
F3 Measurement & Feedback 3.9000 3.8133 3.8792 0.046 0.955 Not sig.
F4 Continuous Improvement 3.5625 3.7500 3.6042 0.212 0.811 Not sig.
F5 Supplier Quality 3.8000 3.7333 3.6167 0.127 0.881 Not sig.
Management
F6 Systems and Processes 3.6875 3.6500 3.7917 0.135 0.874 Not sig.
F7 Education and Training 3.7500 3.6333 3.5208 0.181 0.836 Not sig.
F8 Work Environment & 4.0630 3.7170 3.5630 0.660 0.525 Not sig.
Culture
H1: m1 2 m2 = 0, i.e. there is a significant difference between small, medium, and

large companies on the means of TQM barriers.
From the results obtained, it was found that there is no significant difference between
small, medium, and large companies on the means of TQM barriers. Both SMEs and
large companies face the same problems or barriers in TQM implementation. The
results are summarized in Table 20.
Conclusions and Future Research

This paper has presented the results from survey about the level of TQM and TOC
understanding and practice in Malaysian automotive suppliers. An important area inves-
tigated is the achievement of quality system certification and quality awards. Even
though most of the companies are still in the early stage of implementing TQM, all of
them have been certified to quality system standard and some of them have even won
quality awards. It shows that many of them have achieved a high level of quality
program. This is probably due to the companies having good understanding and
knowledge of TQM even though most of them are still in the average level.
When the extent of TQM practices are related to TQM results and barriers, it shows that
the highest critical factors practiced by the respondents was Measurement and Feedback
(3.8200). This is reflected in the improvement of customer satisfaction and reduction in the
number of customer complaints. The findings also show that Education and Training
(3.6048) and Resource Management (3.5935) were the two least practiced factors of
TQM, which is shown in the TQM barriers relating to training with no purpose and
lack of resources. However, this can still increase the number of employees’ participation
on quality efforts and employee satisfaction.
The analysis also revealed that one of the highest barriers in implementing TQM is
resistance to change. Serious problems will possibly arise when employees cannot
commit themselves to the process that they do not approve of. So, it requires great
effort from the management to develop the whole company’s quality culture.
Table 20. One-way anova test results on TQM barriers for small, medium, and large companies
Mean
p-
Description Small Medium Large F value Results
1. Lack of understanding. 3.75 3.60 3.58 0.058 0.944 Not sig.

2. Lack of preparation (No budget, 3.50 3.67 3.25 0.567 0.573 Not sig.
no sponsor).
3. Resistance to change (Too busy) 3.75 3.67 3.92 0.235 0.792 Not sig.
4. Lack of vision. 3.75 3.53 3.33 0.305 0.739 Not sig.
5. Lack of top management 3.25 3.33 3.00 0.310 0.736 Not sig.
commitment.
6. Lack of customer focus. 3.25 3.47 3.00 0.667 0.521 Not sig.
7. Lack of resources. 3.50 3.07 3.25 0.268 0.767 Not sig.
8. Lack of systems and structures 3.50 3.60 3.33 0.213 0.810 Not sig.
for TQM activities.
9. Availability to training. 3.25 3.60 3.33 0.370 0.694 Not sig.
10. Training with no purpose. 3.50 3.27 3.17 0.140 0.870 Not sig.
11. Costly consultancies, training 3.50 4.00 3.00 3.016 0.065 Not sig.
programs.
12. Lack of rewards and recognition. 3.25 3.60 3.33 0.402 0.673 Not sig.
13. Lack of effective measurement 3.50 3.47 3.25 0.226 0.799 Not sig.
criteria.
14. Lack of evaluation procedures and 3.25 3.40 3.17 0.259 0.774 Not sig.
benchmark indices.
Another finding was the significant difference that exists between perceived importance
and the extent of practice of TQM CSFs by the companies. It can be concluded that the
companies know the importance of TQM factors, but have failed to accomplish them. It
was also found the level of CSFs practice in Malaysian automotive suppliers was
between neutral important to important level. This means the efforts must be done in
encouraging these respondent companies to adopt and practice those CSFs. It is important
to improve their business process effectiveness and thus enhancing their competitiveness
in the local, regional and global market.
The findings about TOC show that the level of TOC understanding and implementation is
still very low in Malaysian automotive suppliers. Only 19.35% of the respondent companies
have actually implemented it. All of them are medium and large companies; there are no small
companies. It indicates that TOC is still something very new in Malaysian automotive suppli-
ers. There are many companies that do not have knowledge about TOC. Some of them have
only recently heard about TOC, and have not implemented it yet.
Future research will concentrate on conducting case studies to obtain more information
on developing a TOC-based TQM framework, which consists of procedure for using TOC
in TQM implementation. The framework will hopefully be useful and applicable within
the context of Malaysian automotive suppliers.
Acknowledgement
The authors would like to thank the Ministry of Science, Technology and Innovation,
Malaysia, for the research funding through project number 03-02-06-0060 EA 254.
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Total Quality Management and Theory of C

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Total Quality Management

Vol. 17, No. 8, 999 –1020, October 2006

Total Quality Management and

HILMA RAIMONA ZADRY & SHA’RI MOHD YUSOF

1478-3363 Print=1478-3371 Online=06=080999–22 # 2006 Taylor & Francis

generator of inter-industry linkages, must be able to stay competitive and be in business.

Total Quality Management

Theory of Constraints (TOC)

1. The five focusing steps of TOC

The Five Focusing Steps of TOC

(1) Identify the system constraints (Its weakest links).

(2) Decide how to exploit the constraints.

Table 1. Thinking process tools and their roles

Questions Purpose TP tools

Table 2. Internal consistency test results-CSFs of TQM

No. of Alpha Items for Alpha if item

F1 Management Leadership 6 0.8346 None 0.8346

Table 3. Construct validity test results-CSFs of TQM

Eigen %variance Items for Item loading

F1. Management Leadership 3.285 54.753 None 0.645– 0.802

Table 4. Position of respondents in the company

Position in the company Frequency Percentage (%)

CEO/ GM/ Director 7 22.6

Figure 1. Background of Respondents: Company Size

Table 5. Company ownership

Company ownership Frequency Percentage (%)

Quality Initiatives Implemented

Table 6. Number of years involved in TQM

Company ownership Frequency Percentage (%)

Less than 3 years 11 35.3

Table 7. Number of companies certified to quality system standard

Quality certification No. of companies Percentage (%)

Note: Some companies have more than one certification.

Theory of Constraints Understanding and Practices

Table 8. Number of companies have won quality award

Quality award No. of companies Percentage (%)

State Quality Award 2 6.5

Table 9. Quality Initiatives Implemented

Quality initiatives Frequency Percentage (%)

Setting up of a quality department 28 90.3

Figure 2. Percentage of Companies Know about TOC

Table 10. Number of companies implemented TOC

Implemented TOC No. of companies Percentage (%)

Level of Understanding and Knowledge on TQM

. Teamwork and participation are important for achieving a continuous improvement

On the other hand, the least important issues are:

. TQM aims to make customer satisfaction as the focus of a business

Table 11. The level of TOC thinking process (TP) implementation

TOC TP Mean Rank

Current Reality Tree (CRT) 2.63 1

Note: The total number of companies implemented TOC TP ¼ 8 companies (N ¼ 8)

No. Statement Mean

1. Teamwork and participation are important for achieving a continuous 4.55

Total Quality Management Results

Table 13. Score of understanding and knowledge on TQM

Level of Score (Out of No. of Percentage Percentage of

Table 14. Mean score for TQM results

Statement Mean Rank

1. Customer satisfaction has shown improvement. 3.8065 1

Perception on Barriers to TQM

Table 15. Mean score for perception on barriers to TQM

Barriers to TQM Mean Rank

Resistance to change (Too busy). 3.77 1