TOTAL QUALITY MANAGEMENT (TQM):

The dynamic environment of rapid change, global competition and more knowledgeable customers, have all made it necessary for the management of organizations to be visionary and strive for excellence in all areas of organizational operations. For an increasing number of companies, this vision focuses on total quality management (TQM), this is, creating an environment of continuous improvement for ever-increasing product and service quality in order to achieve full customer satisfaction.

Top management is increasingly aware of customer-perceived quality as critical to organizational success. A survey conducted by American society for quality control found that 80 percent of the 615 top level executives surveyed, chose product and service quality as the most important issue facing their companies today. They believed that quality plays a crucial role in allowing U.S. business to respond effectively to foreign competition. The companies that have implemented TQM program have reported a strong relationship between quality and organizational success.

Being a buyer’s market in most items of production, high quality has become the most important ingredient of any marketing progamme. People are willing to pay a higher price for a high quality product because of its reliability of service over a longer period of time. Quality is important both for the buyer as well as the producer. When a defective item is returned, it creates a very bad impression in the mind of the buyer who might lose faith in the image of the company as a quality product producer. The producer is equally unhappy due to this defective returned merchandise, not only because the producer may have lost a customer and his goodwill, but it also means that perhaps the quality control during the production of the item was not seriously enforced and this is a highly undesirable activity for the producer.