Total Quality Management in Car Dealership - Case Study Example

TOTAL QUALITY MANAGEMENT IN A CAR DEALERSHIP Student’s Name: Institutional Affiliation: TOTAL QUALITY MANAGEMENT IN A CAR DEALERSHIP Executive summary Total Quality Management (TQM) is among the most efficient methods of ensuring that businesses run smoothly and successfully. This car dealership is among the most experienced and active in the market. Certain issues have to be highlighted and acknowledged in implementing a TQM if it is to be successful. Not only do we deal in new cars but also in used cars making our clientele unique. Being located in the Eastern suburb of Sydney puts gives us a target market constituent of wealthy individuals. Our customers demand that we give them high quality services. It is important that we make quality a high propriety for the sake of long term survival and higher productivity. Continuous improvement implies that the strategy we implement benefits the company in a continuous process such that newer management and human resource will also learn and implement the same strategy. The quality program implemented is known as Six Sigma. The program ensures that the defect levels in production are reduced to a level that will be just about 3.4 parts per million. It is structured so that it meets the expectations and needs of customers while exceeding them at the same time. This happens through including the entire organization in the processes involved in planning and implementation of the TQM program. By including people in the company in the improvement processes, obligations appointed to each of them will be mastered with greater ease. In the process of this, the TQM integrated with the business plan for the company and, it has positive influence growth of market share and the satisfaction of customers. The effects of Six Sigma as a TQM program are persistent in the organization because it is not a program that the company walks away from but one that puts in place a management system and working method. The organizational management encompasses the organization at all levels and while focusing on continuous effort to ensure that customers get the goods and services that satisfy them. Table of Contents Executive summary………………………………………………………………….. 2 Introduction………………………………………………………………………….. 5 Assumptions………………………………………………………………………….. 6 Main body………………………………………………………………………….. 7 Conclusion …………………………………………………………………………… 12 Reference List………………………………………………………………………… 13 List of tables and figures TQM Framework……………………………………………………………………… 9 Measures of proof……………………………………………………………………… 11 Introduction The past decade has been characterized by more intense competition. Consequently, products and services offered by companies need to be distinguished in a manner that attracts more customers. Organizations that offer total service and product quality will have greater success. This means that other than that services and products just meeting the needs of the customers, they will also be provided in a manner that is continuously improving, more productive, more cost effective and timelier (The Times 100, 2012). This is of vital significance if the dealership is to deal with future competition with a greater chance of coming out at the top. The success of TQM is undisputed especially when the strength and success of companies that implement it are taken into consideration. Among the most important issues that need to be taken note of is that it is not the merit of TQM that holds the success factor but how it was implemented with specific reference to timeliness and effectiveness. When in the process of implementing TQM, it is not enough that the company understand it and decide on trying the program out. Substantial changes in management and organization come from the implementation of TQM thus plans are needed in the implementation of TQM. Having insight that TQM is the next step forward is not enough on its own. This insight should be accompanied by a very significant level of organizational focus (Wagoner, 2004). The magnitude, scope and scale of changes that needed to be implemented as well as those that would result from the TQM necessitated a plan of implementation that received support, direction and development from the highest levels of the organization (Zhang, 2000). The planning mentioned here was not limited to the services and products offered by the dealership but also extended to the processes through which the services and products are assembled and delivered to customers. Certain general guidelines were given precedence in the implementation of the process. There are five major activities that organizations should be skilled at if they are to achieve success in implementing TQM programs (Van der Wiele, Dale & Williams, 2000). These activities include being able to experiment with newer approaches in business, having the ability to efficiently transfer knowledge rapidly all through the organization, learning from their past experiences, solving problems systematically and learning form other businesses by adopting their best practices (The Times 100, 2012). These activities contribute to the overall performance of the organization in TQM. One cannot manage anything unless there is a way that the issue can be measured. As such, the implementation process included measurement strategies, which also functioned as proof that the TQM has been implemented successfully. Assumptions One of the most vital assumptions made in the process of implementing the TQM was that support from higher management would be provided without question. To reiterate what had been mentioned before, the TQM needed the cooperation and participation of everyone involved in the dealership including the managers and other staff (Besterfield et al, 2003). As such, the support of management is vital to mobilizing the participation of individuals within the organization. In addition, changes made in the processes of the dealership needed approval from top management. Another assumption that was made is that there would be no major financial issues in implementing the Six Sigma TQM if any. It was assumed that the current dealership budget would support the changes made as the program is implemented since instead of just introducing new processes. Older processes would be modified or replaced (Excellence, 2005). Main body After picking out best practices from companies that have had success with Six Sigma TQM such as Toyota, General Motors (GM) and Motorola as well as literature from various sources, the numerous implementation processes generally fall under four phases of implementation including the launch or start up, the transition, the consolidation and the maturity which also happens with re-focusing. These phases were adapted for our car dealership TQM program as the action plan steps. Within these phases, there were certain initiatives that were undertaken. These initiatives are the activities that facilitated transition from one phase to another. The initiatives include training, teamwork (improvement and problem solving), education course for TQM and processes of quality assurance, creation of a steering group or council and development of the vision and mission (Excellence, 2005). In order to achieve the Six Sigma Goal, everyone within the company was trained in matters to do with quality. This step involved the entire dealership with each person being assigned a specific role that would help them in achieving and building on quality. This is done in the form of training individuals in turns. Managers and those in charge of various departments were the first to undergo training. The aim for this was to ensure they become highly trained in techniques and principles of quality improvement (Wagoner, 2004). These individuals were then awarded a designation to show their accomplishment called black belt. The black belts have a fulltime job of going identifying and solving issues that may arise in terms of quality. It is important that these individuals be the experts because they have others under them who they also have a duty to train on quality issues. As they keep doing this, those working under them will also pick up on skills required for solving as well as identifying quality issues. Training initiatives were directed at specific people starting with managers. These managers then proceeded to train people in their sector in issues following a systematic approach. This approach was informed by the goals and duties that each of the sectors have. Initiatives made in TQM education largely constituted senior management individuals (UNIDO, 2007). This is because they steer the implementation process by approving the changes and processes that have been proposed. It was important for them to understand what is going on with the TQM program. The other activities involved management and staff on equal levels (UNIDO, 2007). In teamwork, which involved improvement and problem solving, staffs were asked to identify on problems that they experienced in their specific sectors such as delays in delivery. Following this, management would use their expertise to come up with ways of solving the problems and improve the situation. The solutions were only implemented if the staffs agreed with it as well. Management was also tasked with aerating steering groups led by their peers. The following figure summarizes the activities involved in implementing the TQM program within a framework . In the leadership front, top managers participated in empowerment as well as being role models in order to have long term success. Supplier quality management involved outlining certain supplier selection criteria with focus placed on suppliers who implement TQM as well (Van der Wiele, Dale & Williams, 2000a). Suppliers also underwent performance evaluation and auditing for quality and, they were informed of our TQM process. The vision statement provided the dealership with a quality policy that guided the overall performance plan, the product quality goal as well as the quality improvement strategy. The evaluation was put in place to assess the overall performance of the dealership, departments, employees and the information system (EFQM, 2000). Measures for the performance of the TQM were judged against the qualities obtained here. Process and control improvement involved assessing capabilities in processes, inventory, equipment, tools and innovation. Product design involved gauging and improving on the packaging, customization and design of experiments. Quality system improvement involves assessing and improving on quality procedures and work instruction and the website. The employees were assessed based on productivity as a team and individual strengths and weaknesses. The recognition and reward plan was modified including salaries, promotion, work environment, bonus schemes, moral awards and penalties. Education and training involved sharpening skills, expertise, and educating for quality (Allen & Kilmann, 2001). Finally, customer focus involved investigating the market and surveys to find out satisfaction. One of the processes we introduced was an online bidding system that would make some of our collectibles available to customers who may not be able to access our dealership at the time. This action was taken after we found out that most of our customers travel and are unable to get the types of cars they want because of logistical issues. Other than bidding, out online site has an inventory of all the cars we have together with details such as fuel capacity and mileage. Customers can become members and go through this information (Van der Wiele, Dale & Williams, 2000a). This site will also act as a method through which customers can make enquiries and receive other customer care services. These activities were specifically geared to improving the internal competency of the organization so that we could serve our customers better. Some of the initiatives that were introduced, such as online access, fell under quality assurance activities (Nicolau & Sellers, 2002). There were different measures used in providing evidence of successful implementation of the Six Sigma TQM. They included measuring behavior and cognitive changes as well as measuring the tangible results obtained such as improvement in sales results (Kanji & Moura e Sá, 2002). Other measures used included customer and evidence based measures, output, input, financial activity based measures and external recognition (Szamosi & Duxbury, 2002). Measure Type of measure Method of obtaining proof used Customer based measures Behavioral and cognitive Feedback from customers through the website and questionnaires provided to customers during visits Efficiency based measures Behavioral Feedback from customers as well as employees and management on production and efficiency levels of the car dealership Output input, financial activity based measures Tangible results Financial reports indicating a rise in sales of cars as well as more orders placed External recognition Tangible results Reports showing improved position within the car dealership market Conclusion  As a car dealership, we have an obligation to rise to the challenge of providing out customer with continuously improving services. This will not only satisfy our customers but also give us competitive advantage. This calls for constant reviewing of strategies of serving customers. Other than that, manufacturers should be part of the TQM because they are in charge of producing the product that becomes the dealership. This TQM report shows the various steps we took to improve the processes within the dealership and cater to customers effectively. The TQM program contains best practices of Six Sigma from various organizations. References Allen, R.S., & Kilmann, R.H. (2001). The Role of the Reward System for a Total Quality Management Based Strategy, Journal of Organizational Change Management, 14 (2). 110-13. Besterfield, D. H., Besterfield-Michna, C, Besterfield, G.H., & Besterfield-Sacre, M. (2003). Total Quality Management. Columbus, Ohio: Prentice Hall. EFQM. (2000). EFQM Excellence Model, European Foundation for Quality Management, Brussels Excellence. SGL Excellence. Retrieved from http://www.sglcarbon.com/company/excellence.html. Kanji, G.K., & Moura e Sá, P. (2002). Kanji´s Business Scorecard. Total Quality Management. 13 (1), 13-27. Nicolau, J.L., & Sellers, R. (2002). The Stock Market´S Reaction To Quality Certification: Empirical Evidence from Spain. European Journal of Operational Research. 142 (3), 632-641. Szamosi, L.T., & Duxbury, L. (2002). Development of a Measure To Assess Organizational Change. Journal of Organizational Change Management. 15 (2), 184-20. The Times 100. (2012). Nissan: Planning for Quality And Productivity. Retrieved from http://www.thetimes100.co.uk/downloads/nissan/nissan_9_full.pdf. UNIDO. (2007). A Roadmap to Quality. An e-learning Manual for Implementing Total Quality Management. United Nations Industrial Development Organization (UNIDO) and Japanese Standards Association (JSA): Austria. Retrieved from http://www.unido.org/fileadmin/media/documents/pdf/tcb_roadmap_to__qualitiy_vol1.pdf. Van der Wiele, A., Dale, B.G., & Williams, A.R.T. (2000). ISO 9000 Series and Excellence Models: Fad to Fashion to Fit. Journal of General Management. 25 (3), 50-66. Van der Wiele, A., Williams, A.R.T., & Dale, B.G. (2000a). ISO 9000 Series Registration to Business Excellence: The Migratory Path. Business Process Management Journal. 6 (5). 417-27. Van der Wiele, A., Williams, A.R.T., & Dale, B.G. (2000b). Total Quality Management: is it a Fad, Fashion, or Fit?, Quality Management Journal. 7 (2), 65-79. Wagoner, R. (2004). Total Quality Management: Success and Failure. Information Education and Technology 600, Section 002. Zhang, Z. (2000). Developing a Model for Quality Management Methods and Evaluating their Effects on Business Performance. Total Quality Management. 11 (1), 129-137. Read More