An Introduction to
Total Quality Management( TQM)
Part 1
The world has become a global village due to the pace of economic changes and the developments in science and technology.
The turbulent new world is being shaped by the forces of globalization, liberalization, marketisation, and competition. The potential benefits of competition in the market place results in an incentive for improvement.
If human ingenuity and creativity can not be stretched far enough we might end up as victims of this change with widespread misery in terms of high costs,obsolescence,business failures, increased unemployment, destructive and suicidal conflicts and clouding of freedom of action,entrepreneurship,innovativeness,and the basic human values of individual dignity and mutual respect.
Effect of changes:
While global changes are going to affect every aspect of human life the central institution of society which is going to bear the brunt is business. The most critical amongst them is the challenge of survival in the face of changing technologies and quantum leap in the needs and demands of people in various parts of the world for new products and services.
TQM- Need of the day:
Related to this concern of business will be the concerns for cost effectiveness, quality performance leadership and customer satisfaction. To survive and grow a perceptive business, leadership today has to realize that there are no permanent rankings in the world of business. It takes double the efforts to stay at the top if an organization has reached the peak.
In the world of business, competition is what makes quality important. Today business competition is conducted on global scale. No market, product or service is impervious to competition.
BUSINESS GOALS
- PROFITABILITY
- GROWTH
- PERPETUITY
- IMAGE
PROFIT=PRICE – COST
COST SUBTRACTION PRINCIPLE
1. COST+PROFIT=PRICE
(STATUS QUO)
2. PRICE – COST=PROFIT
(SUBTRACTION PRINCIPLE 1)
3. PRICE – PROFIT=COST
(SUBTRACTION PRINCIPLE 2)
TARGET IS - LOWEST COST
CONSTRIANTS ARE - PRICE / QUALITY / PROFIT
