The Impact of Total Quality Management On The Organization Performance

European Journal of Business and Management www.iiste.
org
ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online)
Vol.10, No.34, 2018
The Impact of Total Quality Management on the Organization

Performance
Najwa Alweteed
School of Business, Dar Al Hekma College, 6702 Prince Majed-Al Faiha, Jeddah 22246-4872,KSA
[email protected]
Abstract
The main purpose of this study is to investigate the impact of Total Quality management (TQM) practices and
strategies on organizational performance. Starting with understanding the meaning of TQM and knowing the
components that support the overall performance of any organization reaching the end results of outcome. TQM
is defined as a strategy that essentially aimed to create and deliver high quality products and services that cover
all customers' demands and attain a high level of customer satisfaction. Some studies have verified that TQM
practices have significantly positive impact on organizational performances. So to ensure obtaining these results,
managers and leaders are playing a great role in guiding and supporting the performances of their employees.
Thus, it is very important to point that the primary engine for total quality management is to influence
individuals to work, and relies on the principle of administration not to be afraid of risk making and take
advantage of opportunities. Managers and leaders should be open and honest with their employees, and create
channels of communication, dependable, and reward individuals and owners of constructive suggestions, and
recognize their participation and assist them in case of failure
Keywords: Total Quality management (TQM), organizational performance, high quality products and services,
customer satisfaction.
1. Introduction
Total Quality management consists of numerous quality instruments and technique, in addition to several values
and beliefs that all staff within the same organization shares. In fact, the main objective of TQM can be defined
as a strategy that aims to generate and transfer more efficient and higher services, through achieving cooperation
between organizational members. Total quality management also tend to engage all organization staff members
in the process of covering customers' expectation through utilizing problem solving methods to enhance the
quality of all organizational outcomes and services. Therefore, applying TQM leads to achieve a comprehensive
integration among organizational staff and their functions to gain better enhancement, progress and preservation
of products and services quality to achieve customer satisfaction (Dhafer et al. 2015).
2. The Success Factors of TQM

A study of TQM success factors in the UK showed that the main factors that contributed to the effective
implementation of TQM were mostly four: Effective leadership, Economic survival, Market orientation, and
Employee involvement. There was another study improved that employee focus, training, customer focus,
benchmarking and high management support were main factors for a successful implementation of TQM
(Dhafer et al. 2015).
Quality improvement programmes, particularly TQM, have involved many writers and practitioners because it
has been shown that they improve customer satisfaction, which results into increased sales and profit to the
organizations. It has been stated that TQM programmes improve productivity [2]. It is held that progress in
productivity is possible because of the decrease in the cost of quality, decrease in output time and increase in
employee morale (Soltani et al. 2004).
In order for a TQM programmes to take into account organizational processes it must:
 Take into account the larger environment.
 Consider issues related to interaction and feedback.
 Be ready to manage uncertainty.
And, in order for the TQM programmes to deal with organizational culture it needs to:
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European Journal of Business and Management www.iiste.org
Vol.10, No.34, 2018
 Facilitate the creation of a common understanding of the problem.

 Confirm that all relevant stakeholders participate in the intervention process (Alharbi et al. 2014).
In order for the TQM programmes to deal with organizational design issues it must:
 Identify a suitable structure to guide the interaction process.
 Maintain all channels of communication.
Finally, in order for the TQM programmes to deal with organizational politics it must:
 Enable the stakeholders to challenge the capability of the major basic assumptions.
 Support stakeholders uncover any resource and authority related issues that can create the design and
implementation of the programme difficult (Soltani et al. 2004).
Moreover, TQM is an approach to enhance competitiveness, effectiveness, and flexibility of an organization for
the benefit of all stakeholders. It is a method of planning, organizing each activity which is made up of different
practices like customer focus, high management commitment, employee training, employees participation,
process management, supplier teaming, benchmarking, constant improvement, quality measurement, quality
review, quality planning and leadership. These practices provide an efficient and effective way to expand quality
within an organization helping not only to attain the set objectives [5].
Measurement of organizational performance is considered as a crucial element at all managerial approaches.
Cost and quality are the two major measurements of organizational performance which directly affected by the
total quality management practices (Dhafer et al. 2015).
3. The Influence of TQM on The Financial Performance of Organization
3.1 Organizational Performance

Performance is “the results document the relationship between organizations functions in terms of quality
management practices and the results they obtain in several types of outcomes in a hypercompetitive
environment, organizations are highly seeking development, innovation and to develop the quality of the
product\service. Promoting higher quality and innovation should be one of the most important priorities in any
organization (Al-Ettayyem et al. 2015).
3.2 Customer Satisfaction

The word satisfaction had been defined as “a buyer’s emotional or reasoning response post-subjective
assessment and comparison of pre-purchase expectations and actual performance subsequent to the consumption
of the product or service, meanwhile evaluating the costs incurred and benefits gained in a specific purchase
even or over time in course of transacting with an organization”. Most recent studies have focused on the
importance of customer satisfaction which showed that the customer satisfaction is a great trend to develop the
organizational performance. Another study also reflects that customer consideration and satisfaction are
positively and significantly related to the performance of the organization, while other studies had approved that
well-established relationship with customers can increase both financial and nonfinancial performance (Al-
Ettayyem et al. 2015).
3.3 Leadership
Leaders in a TQM system represent the firm as a system; support employee development; create a multipoint
communication among the employees, managers, and customers; and use information professionally and
successfully. In addition, leaders encourage employee participation in decision-making and motivate the
employees. High management commitment and participation in TQM practices are the most important factors
for the success of TQM practices. Managers should consider more leadership than traditional management
behaviors to increase employees’ awareness of quality activities in TQM adoption and practices .Previous studies
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European Journal of Business and Management www.iiste.org
Vol.10, No.34, 2018
have found that leadership develops operational performance, inventory controlling performance, employee
performance, innovation performance, social responsibility and customer outcomes, financial performance , and
overall firm performance (Sadikogla et al. 2014).
In fact, efficiency in leadership is very important as this competitive advantage can only be obtained where staff
are committed and skilled which in turn increases productivity and enhance quality. Moreover, leaders must
proactively undertake positive outlook, consider shaping the competitive landscape, and steering the firm to their
preferred course (Muia et al. 2014).
5. Conclusion
The objectives of the study were to demonstrate and present the degree of effectiveness of TQM practices in
organizational performance. TQM is a holistic and ethical approach of organizations to continuously develop
their products/services or processes involving all stakeholders to satisfy their customers and to improve
performance and sustainability. The results give that overall TQM practices has a positive impact on all
performance measures. Leadership does not affect performance. Knowledge and process management practices
support and develop inventory management performance, innovation performance, social responsibility, and
market and financial performance. Successful training tends to develop operational performance, employee
performance, and customer results.
References
Al-Qahtani, N., Alshehri, S., Abdaziz, A. (2015), “The Impact of Total Quality Management on Organization”,
European Journal of Business and Management 7, 119-127.
Agus, A., Hassan, Z. (2017), “An Empirical Study on The Relationships between TQM Practices and Overall
Services”, Gading Journal for the social Sciences 10(01), 51-63.
Al Harbi, N., Assirri, A., Edhah, B., Hasan, S. (2014), “TQM’s Resurgence and Six Sigma”, International
Journal of Computer Applications 108(4),7-10.
Soltani, E., Meer, R., William, T. (2004), “Challenges Posed to Performance Contributions of Individual
Employees Versus Systems – Level Features”, Total Quality Management & Business Excellence 15, 1069-1091.
Faith, M. (2014),” Effects of Total Quality Management Implementation in Performance of Microfinance
Institutions in Kenya: (A Case of K-rep Development Agency (kda))”, Department of Agency Science, 69.
Ettayyem, R., Zu’bi, Z. (2015), “Investigating the Effect of Total Quality Management Practice in The Jordanian
Banking Sector”, Canadian Center of Science and Educating 8(3), 79.
Sadikoglu, E., Olcay, H. (2014), “The Effect of Total Quality Management Practices on Performance and The
Reasons of and The Barriers to TQM Practices in Turkey”, Advances in Decision Sciences 2014, Hindawi, 17.
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European Journal of Business and Management www.iiste.

The Impact of Total Quality Management on the Organization

2. The Success Factors of TQM

 Facilitate the creation of a common understanding of the problem.

3. The Influence of TQM on The Financial Performance of Organization

3.1 Organizational Performance

3.2 Customer Satisfaction

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