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The Effects of TQM on Performance of a Car Dealer: An Empirical Investigation - Dissertation Example

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Abstract Total quality management (TQM) has been extolled as a key route to business success. In Hong Kong, 70% of the motor authorised dealers have TQM implemented in their companies whereas the rest 30% have only limited quality measure in their daily operations…
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The Effects of TQM on Performance of a Car Dealer: An Empirical Investigation
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Download file to see previous pages This paper aims to find out the effects on the performance of the Service Department of a motor dealer after TQM has adopted and discuss if it is worth to implement for the motor service industry. The outcomes of the study indicate that Employee Satisfaction overall is acceptable two years after TQM has been implemented. However, in terms of the financial and operational indicators measured in the study, only the fix-it-right-the-first-time rate has garnered positive outcomes. Sales turnover and retention rate have both declined from 2007 to 2009. Chapter 1 Introduction 1.1 Background of the Study Due to the increase of global competition over the past decades, the quality of goods and services has become top priority for businesses all over the world. As asserted by Eugenia (2010), the quality of commodities is highly influenced by the customers, thus making customers the primary factor for creating competition among companies. Moreover, due to the experience and perception of customers, organizations are encouraged to improve on the quality of their goods and services. To gain competition entails companies in identifying and addressing the needs and preferences of their customers. Indeed, customers have been considered as the starting point of a successful business instead of its end point (Reid and Sanders, 2007). Therefore, many studies have pointed out that there is a need to establish new managerial processes based on the total quality management (TQM) for companies to achieve long-term success and survival. Quality management remains to be one of the most fundamental components in every business as successful companies recognize how quality can be significantly influenced by customers and, in turn, can benefit the organization (Demirbag, Tatoglu, Tekinkus, and Zaim, 2006). Companies that overlook the quality of their goods and services can bring about dissatisfaction among their customers. Outcomes of such actions can further lead to the loss of customers and increased of opportunities for rival companies to address the market need and obtain benefits. Thus, emphasis on customers’ needs can help enhance quality and improve organizational performance based on quality factors, such as customer satisfaction or financial performance. As noted by researchers, to meet and exceed customer expectations by increasing the involvement of all organizational resources can be attained through a combined effort that is Total Quality Management (TQM). TQM is considered as a holistic approach that enhances quality and brings about continual improvement in companies. Viewed as a management philosophy, TQM is a fundamental tool for an organization’s survival within a competitive environment. The concept of TQM has also been long association with innovation, organizational culture, and competitive advantage (Irani, Beskese, and Love, 2004). Quality improvement can result to cost reduction and increased productivity; furthermore, organizations who are capable of providing excellent quality can improve market shares as well as profitability (Kumar, Choisne, Grosbois, and Kumar, 2009). Similarly, findings of Saizarbitoria (2005) indicated that high quality of products and services can lead to an increase in customer satisfaction, profitability, and market share. 1.2 Quality Management in After Sales Service As the quality of products and services has been widely considered as a strategic factor for attaining competitive advan ...Download file to see next pagesRead More
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