The Role of Top Management Commitment in Quality Management - Essay Example

QUALITY IN FOCUSSED OPERATIONS TABLE OF CONTENTS TABLE OF CONTENTS 2 Introduction: 3 2. Operational processes: 3 3. Literature review: 6 4. Gaps in the current operational process of Sunrise: 12 5. Conclusion: 13 Reference List 15 Bibliography 18 1. Introduction: Total quality management has become an integral part for the business and the social activities throughout the world (Summers, 2011). With the advent of globalization, a new era of business process and operational management has been witnessed. It has impacted not only in the business activities, but also in the global customer’s choices. This study focuses on the operational process of Sunrise Food PLC, which is a leading manufacturer and distributer of restaurant-style Asian food and services, to the retailers and consumers. The intended target market of the company is international and local visitor, families and individual, who are looking for the high quality prepared meal as well as are health conscious, prefer to eat food with organic ingredient. The choice of the company has been made on the basis of its attraction and reputation to the domestic as well as global customers. The order qualifiers for the company are availability of the products, in store service and brand image. On the other hand, order winners for the company are their pricing strategy. Sunrise has devised its product strategy according by strongly emphasizing on the needs of their customers. The company thus offers wide range of finest product to cater to its diversified customer base. 2. Operational processes: Ahire and OShaughnessy (2008) opined that, business organizer creates organizational value by supplying good quality product and services according to the demand of their customers. The inflexible nature of demand and supply often leads to customer’s dissatisfaction and wastage of resources. The operational process is a technique that limits both incidence and consequence of demand-supply mismatch. Operational management process includes arrangement of resources in order to create appropriate mixture of inputs, which in turn, transforms into output within any operation. Thus, firms like Sunrise Food PLC needs to implement this technique to have better matches between demand and supply and thereby, enjoy a significant competitive advantage. The idea of operational process can be used through input-transformation-output model to analyse the core strategies at all three business level (Brauchle and Evans, 2008). These include the level of supply chain, level of operation and the level of process. It is basically a set of process in which business add value to the undergone inputs via transformational process, and sell the final product to the customers. Level of supply chain – The supply chain management focus on combined impact from all aspects in product or services, from supplier to manufacturer to retailer and to the final consumers. This approach includes managing production process in a logistic framework (Dean and Bowen, 2008). It involves everything required to meet customer’s needs and requirements. Increasing competition and global complexities has led most of the business organization to continually improve their capabilities and optimise the supply chain management as much as possible. In order to gain competitive advantage over other rivals, Sunrise needs to devise and implement certain strategies that will help the company to gain competitive edge over the rivals. Thus, it is very important to understand value of its products in the market, priorities that attributes, design their operational process and performing a unique way in which they can create product differentiation. Level of operation strategy– According to Deane et al. (2006), operational strategy within an organization focus on ability of the organization to consistently deliver product and services in order to meet needs and requirements of the customers. Operational strategy is a long-term directions and scopes where businesses can match its operational resources with the external environment in which it operates. Strategies appear to be complicated due to the impact of organization’s inability to add value to its products and services. In order to deliver consistently good quality product, Sunrise needs to take into consideration the requirements of the customers in their overall business plan. It must focus on the areas like, cost, quality, flexibility and speed. Operational process in business strategy deals with meeting customer’s need as well as market direction towards procurement and delivery of the final product or services to the customers. Level of process Level of process may be referred to as the strategic or organizational unit level at larger. For each unit of business level, the strategic direction concerned with identification of market in which targeted customers participates (Goh and Ridgway, 2006). In this context, competitive advantage may be achieved by implementing various strategies, like product innovation, competitive cost or customization of service to a niche market. All these strategies are important to make the product or services which customer will value. Operational management process of Sunrise Input Resources Transformational Activities Output products/Services Capital, Materials, Equipment, Suppliers, innovation, Labour (staff), Time and Knowledge Goods (food items, drinks), Service (customer service, cooking, cleaning), Transportation, Alteration, Storage, Inspection, Final Products, Customers, Suppliers, technology and customization of services. The operational process of Sunrise Food PLC is having deep impact on its progress. Sunrise focuses on creating variety in their service offerings and even their food menu has greater variety in comparison to its competitors. In addition to that, it has less chance of systemization or repeatability in comparison to the other restaurants, such as KFC and McDonald. Thus, people like to have food items from Sunrise. However, weaknesses within the company include delay in service, over exposure of brand, low employee productivity and compromise in quality in bid to grow fast. 3. Literature review: As opined by Corbett and Rastrick (2009, pp-49-65), one of the most important assets for any organization is its customers. Success of the organization depends on “how many customers it has” or “how much they buy” or “how often they buy” (Total Quality Management, 2014). Customers those are satisfied will tend to buy more and more frequently. Thus, manufacturers or service industries are using customer satisfaction as a measure of their product or service quality (Hendricks and Singhal, 2008). Ensuring customer satisfaction is one of the major purposes to include quality management or total quality management (TQM) in the production process. TQM implies organizational obsession to meet or exceed customer’s expectation, so that they remain delightful and charmer with the organizational product. Understanding needs and expectation of the customers is crucial to keep the existing business successful as well as to win markets. An organization must provide quality products or services to its customers at reasonable price, which includes outstanding service and on-time delivery. In order to attain this, organization should continually examine their quality system in response to the changing needs and expectations of their customers. The effective TQM in the organizational process begins with defining quality from the customer’s perspectives. Quality Guru Deming has said that “quality also means anticipating the future needs of the customers” (Longenecker and Scazzero, 2007, pp-25-30). Thus, organization should focus on customer satisfaction, not on increasing its profit, as satisfied customer leads to increase in organizational profit. A simple definition of customer satisfaction is suggested by Teboul model. In this figure, the circle depicts needs of the customers and product and service offered by an organization is represented by the square. Customer satisfaction is achieved when the offers exactly match with the needs, i.e. the circle is superimposed on the square. Organizational goal is to cover the expected needs of its customer in a better way than other competition. Figure 1: Customer’s satisfaction model (Source: Lakhal et al. 2008, pp-632) However, customer satisfaction is a subject of matter as it is not easy to measure. There are many features related to customer experience with a product or service and all these needs to be included to get actual picture of customer’s satisfaction. Thus, errors can occur to simplify the entire process. In short, the Teboul model customer satisfaction is a degree to which the product quality matches with their expectation. Relationship between quality management and customer’s satisfaction – According to Kalpande et al. (2010), service quality is prime determinant of customer’s satisfaction as it comes from outcome of the service provider. Another author Nwabueze (2009, pp-421) suggested that, “definitions of customer’s satisfaction relate to the specific transaction in contrast with the attitudes, which are more enduring and less situational oriented”. Schroeder and Sakakibara (2007) in his writing have proposed that, integration of quality management in operational process automatically leads to increase in customer satisfaction. Regarding the relationship between quality management and customer’s satisfaction. Motwani (2009) opined that, quality management is precursor of customer satisfaction; regardless of these relationships are transaction specific or cumulative oriented. The concept of quality management is basically a focused evaluation, which reflects customer’s perception of reliability, assurance, empathy and responsiveness. In short, perception of the consumer towards a product or services is affected by both quality management and price strategy. An emphasis on customer service emerges as a method that helps an organization to add customer value. Further, product warranty represents guarantee of the product quality, which in turn, helps to raise customer’s satisfaction. Now, consumers are willing to pay higher price, but shall never compromise with the product quality. However, perceptions differ from customer to customer. TQM and customer focus: As illustrated by Plutat (2008), there are basically two types of customers, internal and external. External customers are those who purchase the product or services or influences the sale of the product. For example, McDonald had introduced “Happy Meal”, especially for the children. The child never paid money for the products, but they influenced to increase its sale volume. On the other hand, internal customers are those who help to flow internal operation within an organization. They receive product or service and in exchange provide a product or service. Each of the internal customers makes sure that the product quality meets the expectation of the next person. When it happens throughout the entire production process, i.e. manufacturing, sales and distributional channel, the external customer’s satisfaction can be assured. Figure 2: Customer’s supply chain (Source: Flynn et al. 2006, pp-42) The above picture shows a link between customer and supplier change management within an organization. Every employee within an organization plays an important part to build a chain between internal and external customers (Lemak and Reed, 2006). In reality, employees are familiar with the external customer, but not take internal customer in their organizational process. The basic concept of TQM on customer satisfaction is a steady focus on both internal and external customers. The quality management system starts with the documentation of the needs and requirement of both external and internal customers, and in meeting their expectation. TQM and customer satisfaction – One of the basic concepts of TQM is continuous improvement. It implies that, there is no measurable quality level, as needs, values and expectations of the customers are continuously changing and becoming demanding. Chang et al. (2008) suggested some important factor that are necessary to understand perception of the customers, for instance, performance, price, warranty and feature. Figure 3: How TQM works (Source: Aravindan et al. 2008, pp-452) The above figure shows how the TQM program works within an organization to create continuous improvement. Implementation of TQM process helps to improve customer’s satisfaction and reduce waste. Both of them lead to higher organizational profit. 4. Gaps in the current operational process of Sunrise: Due to small size of the company, Sunrise is facing various problems to deliver service as per the needs and expectation of its customers. Operating with limited resource, the company is suffering from both internal and external problems. As the company directly moves from reluctantly into 21st century, most of their operational processes are based on traditional strategy. It lacks to integrate itself with the modern practise and service provision (ResearchMatic, 2014). Further, it has not used internet and communication technology, which results in poor level of communication with the external world. All these factors have simultaneously affected the efficiency and effectiveness of the company. In terms of quality issue, the major problem faced by the company is low and poor quality of their product. The products offered by the company lacks in terms of quality measurement (Murthy, 2007). The major issues faced by the company are related to the quality of the products. The quality parameters and the quality monitoring process of Sunrise is not properly established which in leading to increase in the number of consumer complaints. Moreover, Sunrise also does not have an appropriate policy for measuring the supplier contributions towards the quality aspect. These factors have reduced its customer satisfaction and hamper the business performance. Further, due to lack of proper communication strategy, Sunrise fails to track customer’s complain and thereby, unable to keep proper record about performance evaluation and thus, future planning is affected. Plan of action to resolve the problem In order to overcome its current problems and manage a track in quality factor of their product, Sunrise can implement continuous improvement process. It is a management tool that provides ongoing effort to improve product or service quality. In business term, it refers continually improve business performance from all organizational level, i.e. from top management to low level management. In Sunrise, continuous improvement process can be applied through quality circle, where people from any background within the organization come together and propose their ideas for improvement in the business operation. The implementation of continuous improvement technique can bring great benefit in improving the operational process of Sunrise Food PLC. For instance, continuous improvement ideas will directly come from the employees within the organization. Further, the improvement comes with the implementation of continuous improvement are based on the small changes and thereby, Sunrise don’t needs to bear huge cost. Application of continuous improvement process does not require huge investment and thus, the company don’t have to invest huge money to bring the changes. Lastly, continuous improvement strategy will help to develop a team building relationship among its employees, improve employee motivation level and as a result, employees are also in turn continually seek to improve their own performance. 5. Conclusion: The current paper focuses on analysing the importance of quality factor to determine customer satisfaction in reference to Sunrise Food PLC. The study highlights various problems existing within the company due to its low quality product and service strategy. Number of external and internal issues, such as lack of coordination among the team members, low level of employee motivation and lack of proper information are have been considered as the prime forces behind their poor product and service quality. However, Sunrise can overcome these problems via implementation of continuous improvement tools and techniques, such as quality circle, business process reengaging and total quality management. Apart from that, Sunrise Food PLC should have a well-developed information system to improve its decision making process in long run. Reference List Ahire, S., and OShaughnessy, K., 2008. The role of top management commitment in quality management: An empirical analysis of the auto parts industry. International Journal of Quality Science, 3(1), pp.5–37. Aravindan, P., Devadasan, S.R., and Selladurai, V., 2008. A focused system model for strategic quality management. International Journal of Quality & Reliability Management, 13(8), pp. 79-96. Brauchle, P. E. and Evans, R. V., 2008. Work group performance on production operations management tasks. The Journal of Technology Studies, 24(2), pp.15–20. Chang, S.J., Hyun, P.Y. and Park, E.H., (2008) Quality costs in multi-stage manufacturing systems, Computers & Industrial Engineering, 31, pp.115 Corbett, L., and Rastrick, K., 2009. Quality performance and organizational culture. 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