Total Quality Management at Toyota - Case Study Example

Total Quality Management at Toyota Introduction Total Quality Management is an approach that consists of efforts so as to incorporate a permanent organizational climate where there is continuous improvement so as to deliver the best or high quality products and services to the customers. The previously developed techniques and tools are the basis of the total quality management approach. The key concepts surrounding the TQM approach is that it is the responsibility of the top management to take the initiative of TQM, customer’s requirements defines the quality, improvement and systematic analysis of the work processes enhances the quality in the system, and quality improvement within the organization is a continuous process and is conducted at each and every stage in the organization. TQM effectively combines existing improvement efforts, fundamental management techniques, and specialized technical tools under a structured format for continuously improving the performance at all levels. There exist eight key elements that govern the successful implementation of TQM in the organization. They are ethics, integrity, trust, training, teamwork, leadership, recognition, and communication. The TQM approached was coined so as to make quality the major driving force behind design, planning, leadership and improvement initiatives. The TQM elements can be categorized into four groups such as foundation which includes ethics, trust and integrity, building bricks which include teamwork, training and leadership, and the roof which includes recognition. This approach is being implemented in every organization and this assignment would reflect the total quality management at Toyota Motor Corporation. Toyota Motor Corporation was founded in the year 1937 and is a Japanese automotive manufacturer having its headquarters in Japan. Toyota works on the corporate philosophy of quality first and customer first. Such a philosophy adopted by the company enabled them to receive in 1970 the Japan Quality Control award. The company has always followed the Kaizen principle of total participation and continuous improvement in the system. The company has been successful in incorporating flexibility into the system through conscientious manufacturing that has supported the development of the company. The concepts of problem solving and TQM through innovative techniques has spread throughout the organization and has contributed towards higher working quality and product quality at all stages and enhance the vitality of organizations and individuals. A quality initiative that was in use in Toyota Toyota Motor Corporation has always focused on putting the customer and quality first in its business operations. Quality is achieved through an integration of various aspects such as design, development, manufacturing, sales and even post sales service. Toyota in the present scenario puts the quality first and customer first approach as their foundation and takes the initiative to respond to the customer’s and societies expectations. Every member of the Toyota family remains very conscious regarding the quality factor. They even take the ownership regarding any issue that may rise due to inefficiency in the operations and takes the responsibility for further improvements into the system. All the departments in Toyota coordinate very closely so as to enhance the trust and consumer confidence in the company. In 2012 in order to become the quality leader from the customer’s viewpoint the company combined the quality group and the customer service operations group so as to form the customer first promotion group. The main objective of this group is to quickly respond to the quality issues, strengthening the internal process towards total quality improvements, and giving desirable support for the post sales service at the distributors and dealers (Oakland 223). The Customer First Promotion group acts as a link between the internal process of the organization and the customers. This initiative has helped the company to acquire market information, resolve the quality related issues of customers and at the fastest pace so as to increase customer satisfaction and even enhance the company’s support to the dealers with repair and troubleshooting. The integration of the two individual groups into one can be well described with the diagram given below- (Source: Feigenbaum 34) The company not only incorporates the manufacturing and production operations for product safety but also incorporates design and development divisions to develop new products so as to enhance customer confidence. In the past when the brake fluid leak took place there was only a warning beam that was displayed on the dashboard. Toyota in order to communicate well to its customers regarding what has happened in the car it has adopted an alarm as a warning method along with displaying the warning details on the display. Toyota in respect to the quality aspects is working to develop the global human resource. Toyota as an initiative to enhance quality measures has facilitated customer quality learning centre. This facilitates the hands on learning experience of the employees. The centre provides learning aids such videos, panels, and customer feedback, and it is even expanding its utility towards employee education and various other events associated with the business operations. Excellent sales, improved product quality and after sales services are very much essential for the customers and needs continuous improvement. Toyota has taken the initiative to improve the global customer satisfaction and this it performs through educating dealer staff, enhancing the skill sets of repair technicians, service advisors, and vehicle body parts through a certification program. Toyota is taking effective measures to improve its operations through standardization of on-site operations, parts supply, servicing processes and after sales and sales service that are linked with the operations (Monden 69). Toyota has always kept the customers first in its business processes and even taking effective measures to improving the quality may that is through designing technology based devices or training the employees to achieve the high quality standards. Toyota aims to deliver superior cars in terms of quality performance, intrinsic appeal, driving performance and that too at an affordable price. Toyota’s new quality effort is to implement Smart Stop Technology into all of its vehicles that are manufactured. This feature helps in providing brake override functionality that helps in reducing the engine power when the accelerator pedals and the vehicle’s brakes are simultaneously pressed. In order to further improve on the quality system the company has even launched the Toyota’s Smart Process vehicle evaluation system (Kelemen 116). This would enable the experts of the company to go on the field and analyze the real world concerns of what exactly the customers feel about their vehicles and what is their experience in relation to Toyota’s vehicles. Some of the other important quality measures that the company has implemented are the expansion of the new North American Centre for Quality Excellence’s reach. This approach offers the suppliers and employees of Toyota proper training on quality control. The company even takes the initiative to increase its relationship with its suppliers in order to leverage the expertise to enable improved quality across the supply chain. It has also incorporated specific levels for reliable testing for the key parts of their vehicles. Toyota through its various processes tries to deliver the best of products to its customers. Its main aim is to produce higher standards of quality and take into account the responses of its customers so as to improve upon the process which can facilitate the overall quality management in the system. The company continuously tries to improve upon the quality initiative so that they are able to maintain their position as an industry leader. It already has the initiative of stop technology and smart process which enables that the customers get the best of facilities in the Toyota vehicles. The company even provide wide spread training to its employees so that they have the required skill set to develop high quality product range (Roethlisberger, Dickson 176). The training is not only provided to the individual employees but also helps in bringing forth an effective coordination amongst all the departments so that they are able to resolve the various issues that are linked with their quality management. Such a continuous monitoring of the overall quality of its supply chain helps the company to overcome the loopholes of its operations and facilitate improvements wherever necessary so as to be the industry leaders in terms of high quality and meet the expectations of the customers. Different mechanisms that were used in the management of human resources in the implementation of this initiative Human resources are the most important factor that is required for effective implementation of quality in the operations. The Deming’s PDCA cycle states the way in which effective management is carried out so as to enable the total quality management. The first step is the plan in which the people in the organization identifies the key areas of improvements and decides on what would be done to enhance the facilities. The second step is ‘Do’ in which the change is carried out small scales by the organization. The third step is ‘check’ in which the organization carries on the analysis of whether the change is forecasting the desired results or not. The last step is ‘act’ where the change is adopted on a larger as soon as it gives positive outcomes. The cycle states the effective measures that human resources undergo so as to produce the best quality In order to deliver so there is a need that the goals of the individuals working in the organization are aligned to the organizational goals and mission (Deming 104). When the employees takes the ownership of their tasks and agrees on improving the lacking areas than the organization is bound to produce high quality products as in the case of Toyota Motor Corporation. Crosby’s 14 steps for quality improvement is one of the mechanisms that are used by the company to make quality improvement a very usual procedure to all of the organizational members. The first step is the quality commitment that is undertaken by the management so as to align the business goals with that of quality. The second step is formulation of the quality improvement team. This team is represented by quality experts whose main tasks is to analyze and control the quality over the various divisions and check whether all of the operations involved in the supply chain satisfies the set quality standards or not. The third step is effectively measuring the quality. The fourth step is setting the cost for the quality evaluation. The fifth step relates to the factor that should be the primary concern of every individual in the organization and that is quality awareness. The sixth step involves corrective action that is taken on account of the identified lacking areas for further improvement. The seventh step is setting up of the committee that is responsible to carry on the plan empowerment and critically analyze the zero defects program. The eighth step comprise of supervisory training. This training would help the employees to adopt specific measures so as to embrace quality in their tasks that they perform. The ninth step is the zero defects day in which the management takes the initiative the employees is aware of the necessary changes in the system and puts across the notion of change. The tenth step is goal setting in which the individuals put forward their respective goals towards improvement of quality which is then comprehended so as to form a common goal for enhancing quality measures. The eleventh step is to facilitate a two way communication between the employees and the management. This flexibility in the management enables that the employees can easily communicate to the management the problems they are encountering in the process of attaining the goal of quality improvement. The issues brought to the upper level would initiate effective measures to be undertaken by the leaders to resolve the issues faced by the employees so that they can efficient carry on with the quality improvement initiative. The twelfth step is taking active recognition measure in the forms of rewards and appraisals so that the employees feel encouraged that the effort they are putting towards setting high quality for the company’s products is being recognized by the management. The thirteenth step is setting up a quality council that would take care that everybody is communicated well the quality measures adopted by the company or that which it plans to adopt in the future so that they are able to perform according to the set quality standards. The fourth step is to continuously improve on the quality and repeat all of the steps as it are a never ending process for the company (Crosby 114). The major quality initiative that Toyota undertakes is gathering of customer feedback, designing effective technology within its vehicles, and continuously improves on their loopholes. The company makes it very specific that each and every requirement is passed through quality gateways. As the quality improvement is an ongoing process in Toyota the human resources are effective managed through setting up panel discussions where the employees can put forward their issues regarding the quality initiative. There even exists training programs by experts so that each and every individual takes active participation towards the overall quality management at Toyota. These training programs on site and off site help the work force to effectively perform their tasks with the quality first approach of Toyota in mind. However imparting training programs is not the only way to manage the human resource. In order accomplish the quality initiatives of Toyota the company have specific measures of rewards and recognition. These rewards and recognition helps to encourage those employees who take active participation towards accomplishing the organizational goal of achieving high quality standards in the business operations and be the market leader in terms of quality. The rewards that Toyota gives include monetary rewards, awards and appraisals. This reward system helps the company to constantly monitor the performance the employees so as to analyze whether the new quality initiatives have been easily adopted by the workforce or their still exists some issues that needs to be resolved by the management (Slack, Chambers and Johnston 109). These practices were indeed the best approach as it helped to enhance the skills of the workforce and at the same time appreciated the efforts of the employees towards maintaining the quality level throughout all the departments in the organization. Explanation of whether the management of human resources was responsible for the success (or failure) of this initiative Weak human resource management has been the root cause for many downfalls in the corporate history. The downfall in the quality initiative of Toyota was the weak human resource management practices in the system. Toyota has been accounted to lose $30 billion in the stock valuation. The root cause for their failures was the workers. The company has started giving rewards to the employees for cost containment and shifting from their aim that was maintaining high product failure. There was a mechanical failure that was detected by the leaders of Toyota but was simply ignored because their customer first approach influenced them to produce new products rapidly. Though the organization comprised of employees who were well trained and rewarded on their performance but still they were unable to deal with the error that was occurring in the system. There was subsequent default in the HR practices that lead to the downfall of the company. The rewards and recognition is given to encourage the right attitude towards work and discourage the negative ones. The rewards should always be aligned towards gathering more information on negative news and take actions for further improvement. In case of Toyota the rewards given to the employees were more related to the lean cost cutting rather and rapid growth in sales rather than focusing more on quality improvement and improve the brakes which were very essential in terms of product safety (Ishikawa 97). The employees were keener towards cutting cost and increasing sales rather than ensuring safety for its customers. The reward system set by the company was such that it resulted into hindering the overall reputation of the company. The focus of the workers were more on delivering error free results than on working on the errors that have already occurred in the system. The training program is initiated by a company so that their workforce possesses the capabilities and skills that would be necessary to handle any kind of situation. The Deming’s PDCA cycle is mostly used in Toyota, and the training for the managers should focus on the last two aspects of the cycle that is check and act. The training given to the employees was more on enhancing their skill set rather than on group think or on dealing with the negative information (Caulcutt 153). The training was not so much effective and hence it resulted into making the employees less prone towards dealing with negative information and they even avoided the matter of safety that was linked to the products of Toyota which ultimately led to the failure of the quality initiative undertaken by the employees. The purpose of hiring is to make the individuals who are high performers and possess great skills and capabilities that would be beneficial in dealing with complicated situations a part of the team. The hiring process of Toyota was not to the mark that resulted into possessing those employees who were not willing to stand up to the management and who tried to sweep the problems. The main goal of performance management is to monitor continuously the performance of the individuals in the system so that the efforts are recognized and the areas are identified which requires further improvement. Toyota is well known for possessing high levels of trust in its employees this resulted into inappropriate designing of metrics, performance standards that made the employees over confident about their tasks and they did not improve upon their performance level. There were not even alarm signals given to the senior executives so that they can take control over minor issues before they go out of control. The corporate culture helps in aligning the company’s goals with that of the employee’s behaviours. The culture that the Toyota Company possessed was more biased towards receiving positive information about the quality of their products and their brand reputation. The company was so used to in listening positive information that made them completely avoid the safety measures issues related to their products that resulted from driving conditions. The leaders of an organization should possess the necessary competency that is required in the decision making. However the one way communication leadership approach or rather autocratic leadership style that was followed in Toyota was a very outdated approach and even the competencies that its leaders possesses were not in par with the changing conditions of the automotive industry. Often the retention program of a company is to maintain and keep those customers who have high skills but the retention programs followed in the company led to avoiding those people who bought in problems and this ultimately resulted into many whistleblowers leaving the organization. Risk assessment department plays a very critical role towards calculating and identifying the risks that are associated with the weak human resource practices. However this function was not present within the corporate culture f Toyota which is highly essential for the company as this would have helped to identify the necessary risk and develop strategies to overcome them and would not have resulted into the downfall of the quality initiative undertaken by the company. The risk assessment by the company would have helped in calculating the cost that is associated with avoiding information related to product failures. Thus the human resources management in Toyota resulted into failure of the quality initiatives that were undertaken by the organization. Conclusion Toyota’s major failures were not a result of mistakes that was done by an individual but it is rather series of mistakes that were done across the organization. The corporate functions at Toyota comprise of various factors such vendor management, government relations, customer service, PR etc. The functions are so much correlated that is a major default occurs in one sector than it would ultimately affect the overall functioning of the business operations. Toyota in its initial phase just focused on serving their customers with the highest quality standards. The quality maintained by the company at the initial stage was so high that later it was not willing to accept the fact that there can be any default in their system in terms of product safety. Operations management is a very important functional area and it is on basis of which company can deliver the best of quality to its customers. The total quality management is related to operations management that deals with delivering the highest quality to its customers and adopting measures through which there can be continuous improvement on increasing the quality levels. Similarly was the case of Toyota Motor Corporation whose main aim was to keep quality first in each and every product they design. The major factor that led to failure of the quality initiative was the ineffective HR practices. The company did not put in much of its resources to improve on the HR practices. It eventually requires identification of lacking areas and improves upon them so that the workforce can outperform and meet the quality initiatives of the company. The billions of dollars that the company lost in its quality initiatives could have been avoided if there was a continuous audit and testing of the HR operations of the company. The human resource was not managed efficiently by the company which resulted into major failures in the company’s operations. TQM is not just about adopting the quality approach in the system but it is about continuously improving upon the adopted approach. Works cited Caulcutt. Roland., Achieving Quality Improvement: A Practical Guide. London: Chapman & Hall CRC. 1995. Print. Crosby, Philip., Quality is Still Free. New York: McGraw-Hill. 1996. Print. Deming, Edwards., Quality, Productivity and Competitive Position. Massachusetts Institute of Technology: Cambridge. 1982. Print. Feigenbaum, Armand., Total Quality Control. NewYork : McGraw-Hill. 1991. Print. Ishikawa. Kaoru., What is Total Quality Control? The Japanese Way. New York: Prentice Hall. 1985. Print. Kelemen. Mihaela., Managing Quality. London: Sage Publications. 2003. Print. Monden, Yasuhiro., Toyota production system. Institute of Industrial Engineers: Atlanta. 1983. Print. Oakland. John., Total Quality Management. Oxford: Butterworth-Heinemann. 1991. Print. Roethlisberger, Fritz and William Dickson. Management and the Worker. Harvard University Press: Cambridge. 1939. Print. Slack, Nigel, Chambers Stuart and Robert Johnston. Operations Management. Harlow: Prentice Hall. 2001. Print. Read More