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THE IMPACT OF THE TOTAL QUALITY MANAGEMENT (TQM) ON PRODUCTIVITY

ABSTRACT

As regards to this topic, Total Quality Management (TQM) it goes on reviewing the better ways of improving productivity, product quality, and deliver services. Organizations that adopt the concept of total quality management as culture in the direction of altering the behaviour of managers and employees have become low cost, high quality and high productive in the supply of goods and services in order to honour and support the contributions of all organizational members. This study will also teach us or prove to us that the more an organization is bale to avoid waste, build a system that emphasis prevention rather than engage in the re-work of defective products, correcting mistakes, the higher will be the productivity level of he company. The study will also revealed that DIAMON BANK LTD  will benefited in most areas of productivity through the application of total quality management (TQM). This issue will bring about reduction in operating cost and the effect of higher productivity, and profitability in an organization it will also influences the attitude of workers and their level of performance which call for effective communication between management and workers.

CHAPTER ONE

INTRODUCTION

1.1   Background to the study

Embarking the  total quality management (TQM) phenomenon is a call for organizational excellence. The phenomenon which started spreading like will fire across the Globe in early 1980 has been spurred on by the fierce competitions raging between companies of Japan, North America and Europe, Japan which occupies only 0.3 percent of the worlds land surface and  has only 2.7 percent of the world population with no natural resources, recorded in early 1980 overall percent of the worlds gross national product. That was the period the Japanese were like to the American’s and Europeans by lending and selling quality products at prices which lower than what it  was costing the Americans and Europeans to product them.

TQM is a customer forced performance enhancing tools which can be applied to any type of organization. It balances the diverse elements of business (leadership, strategic, planning, human resources development and management, work processes, management, information system, external customers, employees and stalk holders)  and  aligns them to achieve excellent business results. TQM aims at achieving increasing better production and services at progressive competitive prices, with minimum production or service cost. It involves doing things right in an organization on the  first try, rather than making and correcting mistakes. By focusing on doing things right the first time, organization will avoid the high cost of that is associated with re-work. Many people perceive attention to quality as one of the most important competitive issues of today and tomorrow infact, quality may be one of the most important way a manager can add value to products and services to set them apart from those of this competitors.

Most business organization with in the manufacturing and service industries have in one time or the other experienced a drop in their level of productivity while some are still suffering from it till today. At one time, managers believed that there  was an inevitable trade of between productivity and quality. They through that the two were diametrically opposed that is, increasing one meant decreasing the other. Today however through a systematic application of TQM, effective managers consider productivity  and quality as two sides of the same coin that is increasing one meant increasing the other. Productivity simply means the ratio out put(that is the quantity of goods and services produced) to input  (that is the quantity of labour, capital, energy).

A manufacturer is faced with the problem of product development or modifications that do not meet the required specifications of a quality product, embodies all its characteristics would definitely have  to device a means of preventing waste, cost re-mark. In such a situation, the ratio of resource input would be higher than what the manufacturers produces as output. More also resources will be wasted as a result of rework in trying  to manufacture a quality product. This the level of productivity would be adversely affected, similarly, in the service industry, firms that  render quality customers services are also confronted with the problems of cost of quality which makes it difficult for them to achieve a positive  growth of productivity. This  is because in rendering this quality services, there are six categories of cost which a firm must be able to prevent or control if it is to maintain a growth in productivity. But through the application of total quality management (TQM), a firm can comfortably render quality service and also increase its productivity level. The categories of cost of quality would be discussed.

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