Total Quality Management (TQM)

Total: Made up of whole

Quality: Degree of excellence a product or service provides

Management: Art, Act, or manner of handling, controlling & directing etc.

So, TQM is the art of managing the whole to achieve excellence.

“TQM is defined as both philosophy & guiding principles, that represent the foundation of a continuously improving organization. TQM is the application of quantitative method and human resources to improve all process within an organization and exceed customer needs now and in future.”

TQM framework

 

·         Gurus: Shewart, Deming, Juran, Feigenbaum, Ishikawa, Crosby, Taguchi

·   Tools & Techniques: Benchmarking, IT, Quality management system, Environment management system, Quality function deployment, Quality by design, Statistical process control, Experimental design

·         Principles & Practice: Leadership, Customer satisfaction, Employee involvement, Supplier partnership,

·         Approach: Continuous process improvement

·         Measure: Performance measure

Performance Appraisal

In general sense, p.a. is the process of verifying whether the employee is doing his/her assigned tasks appropriately or not. According to Dessler, "Performance Appraisal means evaluating an employees current and/or past performance relative to his/her performance standards". It is also known as merit rating, personnel rating, efficiency rating, employee evaluation.

"Two heads are better than one"

According to the statement, two people can bring more practical and workable solution of a problem than a single person working alone. The statement indicates the superiority of group decision over individual decision. Group decision is better than individual decision, because:-

• More ideas, information and opinions
• Presence of criticism and correction
• Complement information and completion
• Diversity of knowledge

From the above discussion it can be said that two heads are better than one.

Job satisfaction, Job involvement, Organizational commitment

(1)Job satisfaction: Job satisfaction is an employee’s general attitudes towards his/her job or job elements. In broad sense, job satisfaction is a set of favorable and unfavorable feelings or emotions by which employee views his/her job.
Employee expressing favorable attitudes towards job=Job satisfaction
Employee expressing negative attitude towards job= Job dissatisfaction
The job satisfaction is moving between -100--->+100. A satisfied employee shows better performance
and less absenteeism.
 

(2)Job involvement: Job involvement is the degree to which a person identifies psychologically with his/her job and considers his/her realized performance level important to self worth. High level of job involvement reduces attrition and absenteeism.
 

(3)Organizational commitment: Organizational commitment is the degree to which an employee identifies organization and its objective and wishes to maintain membership in the organization. By this degree employee seemed to be bonded with the organization.

Attitudes

Attitudes are evaluative statements either favorable or unfavorable about objectives, people or events. 

Ex-I love my job.

Components of attitudes:

(1)Cognitive component: It is values or beliefs segment of an attitude that stored in our memory and
used to organize any real life event. Ex- snake is a dengerous animal
(2)Affective component: It is emotional or feelings segments of attitude come from cognition.
Ex-People should keep away from snake
(3)Behvioral component: It is the final behavioral of people based on cognition and feelings.
Ex-Go away after seeing the snake

Global strategic rivalry theory

Global strategic rivalry theory developed by Paul Krugman & Kelvin Lancaster in 1980. According to this theory, a firm have to develop a competitive strategy to sustain in the global competition. A firm can gain competitive advantage through:

(1)Owning intellectual property: It is done by brand name, trademark, patent/copy right, unique formula etc.

Ex-Unique formula of Coca-cola

(2)Investing in R&D: It is the process of gaining competitive advantage by R&D techniques. Ex-Boeing is the most successful airplane industry cause it does huge amount of research for its competitors by its R&D department

(3)Achieving economic of scale or scope: At the time of international trade, the production increased. For this reason cost per unit reduces and new sector/scope is being created for investment therefore, various sized and typed product can be produced.

(4)Exploiting the experience curve: Sometime competitive advantage can be gain by injecting the experience. Very often firms recruit experienced people for their need.

Country similarity theory

Country similarity theory is developed by Swedish economist Steffen Linder in 1961. According to this theory two types of trade is being traded. They are:

(1)Inter industry trade: It is the exchange of goods produced by one industry in country A for goods produced by a different industry in country B. It is usually trade between two industry's of two country's.

Ex-Trade of Wine for Clock between France & Japan

(2)Intra industry trade: It is the trade between two country's of goods produced by same industry. It is actually the trade of same industries between two country's.

Ex-Germany traded BMW to Japan in exchange of Toyota.

Theory of comparative advantage

David Ricardo developed 'Theory of Comparative Advantage' in 1817. According to this theory,"A country should specialize in producing & exporting those products in which it has a comparative/relative cost advantage compared with other countries.

Example:

Production	France	Japan
Wine	4	1
Clock	6	5

 

In the case of France:-

1)Wine=(4/1)=4 times better in wine production than Japan 2)Clock=(6/5)=1.2 times better in clock production than Japan here, France should only produce Wine

In the case of Japan:-1)Wine=(1/4)=0.25 times better in wine production than France 2)Clock=(5/6)=0.83 times better in clock production than France

here, Japan should only produce Clock

So, the total production will be:-France(Wine)=(4x2)=8 unit Japan(Clock)=(5x2)=10 unit

International trade: If 1 bottle wine=2 unit clock is traded, then-

Production	France	Japan
Wine	4	4
Clock	8	2