A Quality Principle: Everything You Need to

Know about Total Quality Management

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Today, we take for granted that the items and services we consume should work well as soon as
we purchase them. In fact, many Industrial and post-industrial societies have simply discarded
what doesn’t work. However, there was a time when quality and effectiveness were not always
the priority for goods and service providers. The intense focus on quality developed largely after
World War II, in particular in the 1980s, in response to a marketplace that rejected cheap
workmanship and consumer demand increased for durable products that considered the user’s
needs.

In this article, we’ll discuss the history of one of the preeminent quality management
philosophies, total quality management (TQM). We’ll learn how it can help for profits and
nonprofits become more effective and cost-efficient. In addition, industry experts discuss how
TQM compares to other quality philosophies and methodologies, such as Six Sigma and Kaizen.

 What Is Total Quality Management?

 What Is Quality Management?
 Total Quality Management Principles
 The History of Total Quality Management
 The Beginning of the Quality Era in Japan
 Total Quality Management in the USA
 Total Quality Management Meets the World
 William Deming and the Origin of Total Quality Management
 Why Is Total Quality Management Important to an Organization?
 What Are the Costs of Quality?
 Total Quality Management Models
 How Do You Implement Total Quality Management?
 Total Quality Management, Kaizen, and Six Sigma: Which One When?
 The Seven Basic Tools of Total Quality Management
 The Key Players in Total Quality Management: Customers, Suppliers, and Employees
 Certifications in Total Quality Management
 Delivering Quality with Improved Processes in Smartsheet

What Is Total Quality Management?

Total quality management (TQM) describes a management system wherein a company attains
organizational advancement through a commitment to customer requirements. A company meets
those requirements when it empowers every employee in every department to maintain high
standards and strive for continuous improvement. Total quality management is the predecessor
of many quality management systems, such as Six Sigma, Lean, and ISO.

Andy Nichols, Quality Program Manager at the Michigan Manufacturing Technology Center,
says that in practical terms, “Total quality management is really a company-wide initiative to get
everybody involved in doing the right thing for the customer.”

What Is Quality Management?

First, what is quality? It is a measure of the level of acceptability of a product or service. The
ASQ Quality Glossary defines quality management as “the application of a quality management
system in managing a process to achieve maximum customer satisfaction at the lowest overall
cost to the organization while continuing to improve the process.” Quality management has four
parts: quality planning, quality assurance (defect prevention), quality control (which includes
product inspection and other elements, such as competence), and quality improvement.

Why would it take until the 20th century to apply such seemingly obvious principles like product
goals and parts inspection? Perhaps the right historical circumstances didn’t present themselves
until the 20th century. Nichols credits new mass-production techniques, such as Ford’s assembly
line, and the urgent demand for materials during two world wars for this particular innovation.
“The US military demanded to some extent that every product they purchased be good because
soldiers lives literally depended on the quality of the products they handled,” says Nichols.
“Whether it was for K rations or bullets, these wars spurred a manufacturing revolution to focus
on the idea of getting things right every time.”

Statistics play an integral part in quality management because being able to predict accuracy
through numbers is much less expensive than inspecting parts. Moreover, sometimes inspection
is simply inconvenient. “McDonald's needs to know that every burger is right without having to
take a bite out of each one,” says Nichols.

Total Quality Management Principles

No single accepted body of knowledge exists for total quality management, as does, for example,
the Project Management Body of Knowledge (PMBOK) for the Project Management Institute.
Similarly, no prescribed actions exist for implementing TQM methods and tools. Organizations
have been free to deploy and adapt TQM as they see fit, giving way to many definitions of the
methodology. Despite these challenges to standardization, it’s possible to describe generally
accepted principles:

 Customer Satisfaction
 Employee Commitment: This creates empowerment through training and suggestion
mechanisms.
 Fact-Based Decision Making: Teams collect data and process statistics to ensure that
work meets specifications.
 Effective Communications: There should be an open dialogue throughout an
organization.
 Strategic Thinking: Quality must be part of an organization’s long-term vision.
 Integrated System: A shared vision, including knowledge of and commitment to
principles of quality, keep everyone in a company connected. Taiichi Ohno recognized
that even suppliers are an important part of the system.
 Process-Centered: You can deconstruct every activity into processes, and, therefore,
locate and repeat the best process.
 Continuous Improvement: Every employee should always be thinking about how to
better perform their job.
You could sum up the goal of TQM in this way: “Do things right the first time, every time.”

The History of Total Quality Management

There is no single, agreed-upon source for the phrase total quality management. Some experts
believe it came from two books by seminal quality management thinkers: Armand Feigenbaum’s
Total Quality Control and Kaoru Ishikawa's What Is Total Quality Control? The Japanese Way.
Others say the terminology arose from an initiative in the United States Navy to adopt quality
management guru William Deming’s recommendations, which they termed total quality
management. TQM did not enjoy widespread acceptance until the 1980s.

The roots of the principles and practice of TQM extend back to the early 20th century and
Frederick Taylor’s Principles of Scientific Management, which advocated a consistent way of
performing tasks and inspecting finished work to prevent defective products from leaving the
shop. Further innovation came in the 1920s with Walter Shewhart’s elaboration of statistical
process controls, which one could apply at any point in the production process to predict quality
levels. It was Shewhart who developed the control chart, used today for managing with Kanban
and Agile.

Throughout the 20s and 30s, Shewhart’s friend and mentee, William Deming, developed
statistical process control theories that he would eventually use to help the US Census
department in the early 1940s. This was the first use of statistical process control in a non-
manufacturing field.

The Beginning of the Quality Era in Japan

After the war, other American quality theorists, including Deming, who would achieve hero
status in Japan, advised Japanese industry on how to improve processes and output to rebuild
their war-shattered economy. At the time, the term made in Japan was synonymous with shoddy
craftsmanship. As early as 1945, such visionaries as electrical engineer Homer Sarasohn spoke
about controlling variation and monitoring process to produce better deliverables.

As a result, in the 1950s, quality became the byword for Japanese manufacturing. Quality
concerned not just management, but all levels of a company. In the 1960s, quality circles began
appearing in Japanese workplaces to allow employees the opportunity to discuss problems and
consider solutions, which they then presented to management. Starting on the factory floor,
quality circles spread to other functional departments. The company-wide focus on quality may
also provide a clue to the origin of the phrase total quality.

Total Quality Management in the USA

By the 1970s, the term made in the USA was no longer a badge of pride. Since the end of WWII,
the main effort in American factories was to produce a large quantity of items, maintain the
production schedule, and save money. Usability and durability seldom mattered until concerns
about lack of product quality reached a fever pitch. As Japan successfully challenged the United
States for industrial leadership, US industry now took a page from Japan’s quality-improvement
book. A new interest in quality management took hold, building on the work of Shewhart’s
disciples, such as Deming, Josef Juran, and Kaoru Ishikawa in Japan. Influential businessmen
like Philip Crosby championed the trend.

Although the growth of TQM seems to have occurred exclusively within the precincts of
industry, the basic outlines of the concept owe much to a 1980s US Navy project that used
Shewhart and Deming’s PDCA (plan, do, check, act) model. Navy guidelines articulated the
principles that customer requirements should define quality and continuous improvement should
pervade an entire organization. Navy success with the methodology led to TQM’s adoption by
other armed services, such as the army and coast guard, and eventually the rest of the US
government. Congress established the Federal Quality Institute in 1988 to highlight the need for
quality management in business and reward organizations for successful implementations.

Total Quality Management Meets the World

Quality management began in manufacturing, and TQM, like it’s subsequent methodologies,
adapted well to finance, healthcare, and other fields. Some of the landmark companies to adopt
TQM include Toyota, Ford, and Philips Semiconductors.

Worldwide, countries such as Germany, France, the UK, and Turkey established TQM standards.
But by the 1990s, TQM was superseded by ISO (International Standards Organization), which
became the standard for much of continental Europe, and by another methodological response of
the 1980s to quality concerns, Six Sigma. Nevertheless, TQM principles form the basis for much
of ISO and Six Sigma. For example, PDCA appears under the Six Sigma method DMAIC
(define, measure, analyze, improve, control). And in the 2000s, the ISO governing body
recognized TQM as a foundational philosophy. TQM lives on in data-driven methods for a data-
driven age.

William Deming and the Origin of Total Quality Management

Much of our current understanding of the value and pursuit of quality traces back to William
Deming. This American statistician, engineer, and management consultant laid many
foundations for the use of statistics in production and work management. He introduced
statistical process methods to the US Census Bureau in the early 1940s, marking the first time
they were used in the business or service sector. During WWII, he advised US business and
government on statistical methods to help with planning for wartime manufacturing. After the
war, Deming was recruited by no less than General Douglas MacArthur to advise Japanese
officials on census models to assess war damage and plan for rebuilding.

Deming distinguished himself among many of the occupying forces by showing a genuine
interest in Japan and its culture. Perhaps it’s not surprising, then, that the Japanese revere him for
his role in midwifing the Japanese economic miracle.

Because Japan lacked abundant natural resources, Japanese leaders viewed the exportation of
goods worldwide as their main path to financial success. Their post-war reputation for low-
quality products posed a particular challenge to this goal. Deming was invited back to Japan by
the Union of Japanese Scientists and Engineers (JUSE), whose president was Kaoru Ishikawa, to
discuss quality management, ideas that formed the basis for what later became known as TQM.
Japanese products were gradually recognized for usability and durability. In 1960, for his efforts
on behalf of Japanese industry, Deming received the Second Order Medal of the Sacred Treasure
from the Emperor of Japan. By the 1970s, Japanese exports surpassed those of the United States.

By contrast, American goods gained a reputation for poor design and defects. As early as 1940,
Juran remarked that producing goods and meeting deadlines took priority, with quality being
relegated to the final inspection. Deming believed that as soon as the war was over, US industry
lost interest in statistical methods for pursuing quality. Ironically, it was Deming who, in the late
70s and early 80s, introduced the US and the UK to the quality management principles he’d
taught in Japan 30 years earlier. In 1967, he published the article “What Happened In Japan?” in
the journal Industrial Quality Control. Professionals consider it to be an early version of his
famous 14 Points and PDCA cycle.

Although well-known in academic quality control circles, he achieved greater prominence when
he was interviewed for the 1980 NBC documentary “If Japan Can, Why Can’t We?” In the
program, Deming emphasized that, “If you get gains in productivity, it is only because people
work smarter, not harder. That is total profit, and it multiplies several times.” The documentary
revealed another act in Deming’s life, that of a sought-after quality consultant to American
business. He gained a reputation for bluntness and fearlessness in the presence of senior
executives. Legend has it he told senior Ford staff that 85 percent of quality issues resulted from
poor management decisions. Some companies rejected him. However, on his advice, Ford
conducted user surveys before designing and building the Ford Taurus. In 1992, the Taurus
became the number one selling car in the US.

In his 1986 book, Out of the Crisis, he discussed his 14 Points for Management. The following
year, at the age of 87, he was awarded the National Medal of Technology. In 1993, the year of
his death, he established the Deming Institute.

Why Is Total Quality Management Important to an Organization?

Nichols says that TQM tools and principles acquire power not when an organization creates a
dedicated quality department, but when it includes the whole company in the pursuit of high
quality. An example is the quality circle, in which workers directly involved in a process
brainstorm to discover solutions. “People are a fabulous resource that is frequently underutilized.
The leadership often doesn’t recognize the value that they bring to the everyday workplace.
Employees know how to fix problems,” asserts Nichols. In addition to tapping a native resource,
implementing a TQM philosophy can help an organization:

 Ensure customer satisfaction and customer loyalty

 Ensure increased revenues and higher productivity
 Reduce waste and inventory
 Improve design
 Adapt to changing markets and regulatory environments
 Increase productivity
 Enhance market image
 Eliminate defects and waste
 Increase job security
 Improve employee morale
 Reduce costs
 Increase profitability
What Are the Costs of Quality?

A fundamental tenet of TQM is that the cost of doing things right the first time is far less than the
potential cost of re-doing things. There are also residual losses when customers abandon
products and brands for quality reasons. Some schools of thought view quality as having a cost
which cannot be recouped. Juran, Deming, and Feigenbaum held a different view. For advocates
of TQM, the cost of quality really describes the cost of not creating a quality deliverable. There
are four primary cost categories:

 Appraisal Costs: Appraisal costs cover inspection and testing throughout the production
cycle. This includes verifying that the materials received from the supplier meet
specifications and ensuring that products are acceptable at each stage of production.
 Prevention Costs: Prevention costs include proper setup of work areas for efficiency and
safety, and proper training and planning. This type of cost also includes conducting
reviews. Prevention-related activities often receive the smallest allocation of a company’s
budget.
 External Failure Costs: This category concerns the cost of issues following a product’s
market release. They may include warranty issues, product recalls, returns, and repairs.
 Internal Failure Costs: Internal failures are the costs of problems before products reach
customers. Examples of internal failures include broken machines, which cause delay and
downtime, poor materials, scrapped product runs, and designs that require rework.

Total Quality Management Models

Although TQM does not possess one universally recognized body of knowledge, organizations
do pattern their efforts after a few formal models, including several industry entities and awards.

The Deming Application Prize was created in Japan in 1950 by the Union of Japanese Scientists
and Engineers (JUSE) to acknowledge companies and individuals from around the world for
their successful efforts at implementing TQM. Winners have included Ricoh, Toyota,
Bridgestone Tire, and many others.

Congress established The Malcolm Baldrige National Quality Award (MBNQA) in 1987 to raise
awareness of quality and reward US companies who pursue it. The National Institute of
Standards and Technology (NIST) administers the award. It is given to large and small
companies and nonprofit entities that demonstrate excellent performance in the following areas:

 Delivery of increasing value to customers and stakeholders, contributing to

organizational sustainability
 Improvement of overall organizational effectiveness and capabilities
 Implementation of organizational and personal learning

Past winners have included the Chugach School District, Concordia Publishing House, and
Boeing Mobility.

The nonprofit European Foundation for Quality Management (EFQM) was established in 1989
to provide a quality framework for organizations throughout Europe. They maintain the EFQM
excellence model, which embraces the following precepts:

 Adding value for customers

 Creating a sustainable future
 Developing organizational capability
 Harnessing creativity and innovation
 Leading with vision, inspiration, and integrity
 Managing with agility
 Succeeding through the talent of people
 Sustaining outstanding results

Participating organizations can partake of training and assessment tools and may apply for the
EFQM Excellence Award.

The International Organization for Standards (ISO 9000) publishes guidelines and specifications
for parts, processes, and even documentation to ensure that quality is consistent across
companies, organizations, and borders.

How Do You Implement Total Quality Management?

PDCA lies at the core of many 20th century quality efforts. PDCA began in the 1920s as a
conception by engineer and statistician Walter Shewhart. It was originally called PDSA (plan,
do, study, act). Widely disseminated by Deming, who referred to it as the Shewhart cycle, it is
now often referred to as the Deming cycle.
Marlon Walters, the Founder and CEO of Horizon Group Consulting, explains each step of
PDCA:

“Plan: The planning phase is the most important. That’s where management, along with
the associates, identify the problems to see what really needs to be addressed — the day-
to-day things that may be happening on the productivity side that management is not aware
of. So they’re trying to determine a root cause. Sometimes, employees do research or high-
level tracking to narrow down where an issue may originate.

Do: The doing phase is the solution phase. Strategies are developed to try to fix those
problems identified in the planning phase. Employees may implement solutions and if a
solution doesn’t appear to work, it’s back to the drawing board. In contrast to Six Sigma,
it’s less about measuring gains and more about whether the employees judge the solution
to be working.

Check: The checking phase is the before and after. So after you’ve made these changes,
you see how they’re doing.

Act: The acting phase is the presentation or the documentation of the results to let
everybody know, ‘Hey, here’s how we were doing it. Here’s how it is now. This is the new
way, and this is what this should address going forward.’”

Nichols says that in 2000, ISO acknowledged PDCA as a foundational method. It appears again
in Six Sigma as the DMAIC method (define, measure, analyze, improve, and control). Walters
notes that TQM is much more people oriented, while Six Sigma is process based. He sees, for
example, that the term define “takes the human element out” and the term measure focuses on
data.

Total Quality Management, Kaizen, and Six Sigma: Which One When?

While TQM’s method of using employees as a source of ideas and solutions can help companies,
Six Sigma’s process and measurement focus — which promotes data-driven decisions — offers
compelling benefits. Walters uses the example of producing peanut butter and jelly sandwiches.

“We’d start out with two pieces of bread, add the peanut butter, add the jelly, and put the two
pieces of bread together. But, maybe the edges are smashed together. Maybe the corners are
damaged. Or, when our customers get it, they say the bread is soggy. Within that process, we’re
not sure whether we’re putting on too much jelly or whether we’re using the wrong type of
peanut butter. You just don’t know what it is, so you have these group meetings and brainstorm
until your customer response is what you want, and the level of acceptance of your quote
unquote quality product is where you desire it to be,” says Walters.

With Six Sigma, however, the questioning process would drill down to the details. What kind of
bread were you using? What kind of peanut butter? What kind of jelly?

“That to me is the benefit because it takes the onus off the people and focuses strictly on the
process,” asserts Walters. “So, if we tighten up the process, we can feel like we already have
quality people. And after the process is repeating in the same manner, even if there are other
performance issues, that automatically sets you back to the human side. But then you can
manage the human issue properly because you don’t have to worry about your processes. Your
numbers aren’t changing.”

Walters states further that most companies want to develop brand loyalty, even if their product is
essentially the same as a competitor’s. “If we use TQM, we hope a product is of better quality, so
you’ll come back. With TQM, you have to wait for your customers to confirm that it’s good.
With Six Sigma, at the end of the day, you don’t guess if your product is better. You know it. If
you properly identify your market and your product has the best fit for the niche, you know you
have the best product from a process perspective. That leads to the deeper relationships,” he
says.

If Six Sigma can offer definitive results for an existing process and TQM can help achieve
results over time, where does Kaizen fit? Kaizen is a Japanese word meaning philosophy of
improvement. It includes the 5 Ss, seiri, seiton, seiso, Seiketsu, and shitsuke, translated loosely
into English as sort, set in order, shine, standardize, and sustain. Kaizen is considered more of a
philosophy for how to organize your workspace and the larger workplace and how to have the
right attitude toward your work and coworkers.

Kaizen events are improvement efforts that involve small teams that spend a short time, usually
about a week, considering and testing improvements. The team then presents its findings to
management. Management periodically reviews the solutions to make sure that they continue to
benefit the team.

Like TQM, Kaizen approaches efforts from the perspective that the whole company is
responsible for quality and that improvement must be continuous. It is generally less
methodological than Six Sigma, although Kaizen may inform the lean aspect of Lean Six Sigma.

The Seven Basic Tools of Total Quality Management

According to the experts, the basic tools of TQM allow anyone - even someone without
statistical training - to gather data to illuminate most problems and reveal possible solutions.
Here are the seven basic tools of TQM:
  Check Sheet: This is a pre-made form for gathering one type of data over time, so it’s
only useful for frequently recurring data.
 Pareto Chart: The chart posits that 80 percent of problems are linked to 20 percent of
causes. It helps you identify which problems fall into which categories.
 Cause and Effect Diagram or Ishikawa Diagram: This diagram allows you to visualize
all possible causes of a problem or effect and then categorize them.
 Control Chart: This chart is a graphical description of how processes and results change
over time.
 Histogram Bar Chart: This shows the frequency of a problem’s cause, as well as how
and where results cluster.
 Scatter Diagram: This diagram plots data on the x and y axes to determine how results
change as the variables change.
 Flow Chart or Stratification Diagram: This represents how different factors join in a
process.

The Key Players in Total Quality Management: Customers, Suppliers, and

Employees

To achieve success with a total quality management program or any other improvement
methodology, managers must understand the quality goals for their product or company. They
must then communicate those goals, in addition to the benefits of TQM, to the company, as
employees play a vital role by contributing their intimate, day-to-day knowledge of product
creation and processes.

TQM is a philosophy that values comprehensiveness. Therefore, suppliers are a crucial part of
TQM execution. Companies must vet new suppliers and regularly audit existing suppliers to
guarantee that materials meet standards. Communication with suppliers about TQM goals is also
essential.

Customers are the most significant part of the TQM equation. After all, they’re the reason for
TQM’s existence. Aside from the obvious feedback the sales team provides, customers —
product or service users — give information about what they want from the deliverable, whether
that deliverable is tangible or a service.

Certifications in Total Quality Management

Since its heyday in the 1980s and 1990s, TQM has been largely superseded by Six Sigma and
ISO 9000. “The thing about Lean and Six Sigma is that they have a very definite set of methods
to achieve these goals effectively. You go do x, y, and z,” explains Nichols. “ISO is a universal
standard, and it’s clear what you have to do.Of course, what goes along with that is that you can
be certified, which is outside the scope or remit of TQM,” concludes Nichols. He suggests that
TQM lost traction in the UK because Europe adopted ISO in the 1990s. Today, formal TQM
training is rare. Nichols suggests that companies with interest in pure TQM may pursue
something like the Baldrige award.

Delivering Quality with Improved Processes in Smartsheet

Total quality management professionals understand the impact that efficient processes have on
delivering the highest-quality products or services. That’s why top TQM professionals rely on
Smartsheet to align the right people, resources, and schedules to ensure that the the work gets
done in the most efficient and effective way.

Smartsheet is a work management and automation platform that helps enterprises and teams
work better. Over 69,000 brands, and millions of information workers, trust Smartsheet to help
them accelerate business execution and address the volume and velocity of today’s collaborative
work. In fact, the team over at Creating IT Futures (a Chicago-based nonprofit) use Smartsheet
to streamline processes and increase real-time transparency.

By using Smartsheet to incorporate some much needed automation and create one location for
the truth, the team was able to streamline challenging processes, mitigate costly data entry errors,
and increase transparency. Creating IT Futures CEO Charles Eaton explains, “The biggest
benefit of Smartsheet, is that information is instantly updated and can be shared with as many
people as we need. … With the increase in productivity and efficiency, Smartsheet saved us
about $25,000 a year.”