Total Quality Management at Saudi Standards, Metrology and Quality Organization - Case Study Example

Implement Total Quality Management at Saudi Standards, Metrology and Quality organization (SASO) Name: Grade Course: Tutor’s Name: 13th May, 2011.   Abstract Total Quality Management is an organizational and managerial philosophy that focuses on customer satisfaction. Consequently, the provision of quality products and services are geared towards the satisfaction of the needs of the customer. The word “Total” emphasizes the need for all the personnel of the organization to contribute collectively towards customer satisfaction; which ultimately, improves the organization and services or goods that it produces. This paper will focus on two subject matters. First, an examination of the concept of Total Quality Management in the broader context of customer value in relationship to customer value strategy and processes. Further, another theme that is discussed is the exploration of the concept of customer value, identity measurements of customer values, the techniques that are related to customer value and the relevance of customer loyalty. The focus organization in the above considerations is SASO; with its vision of being the a reputable organization in the standardization and quality field at all levels which are regionally, nationally and internationally, it requires the contribution of all stakeholders to achieve this vision. In the paper, the steps that have to be taken by the organization will therefore be analyzed and ways to improve its service delivery. Introduction The last few decades have seen Total Quality Management (TQM) take an important role in ensuring that activities in both the public and private sectors are improved to satisfy the customer’s needs (Matei & SĂvulescu, 2011, p. 41). The concept of Total Quality Management started after World War II in Japan. It paid attention to customer satisfaction, comprehending the customer’s needs as well as foreseeing his demands, expectations and proactively addressing the same (Subburaj, 2005, p. 3). Contemporarily, there is a firm competition in various ventures that necessitate various firms, governments and organizations to be proactive in remaining relevant in the new economic order that is unveiling all over the world. This means that the practices of doing business at all levels of any given country must be changed to match the global trend that is constantly changing (Lindman, 2010, p. 48). Like in any other country there is a body in Saudi Arabia that acts to ensure that goods that are produced and services provide are of the appropriate quality and are well produced following the recommended procedures and conditions. This is the Saudi standards, metrology and quality Organization whose mandate is concerned with quality standards in Saudi Arabia and to implement the quality standards which comprises the hygiene of products. This it does by providing regulations in various sectors such as agricultural products, textile products and products from chemicals and petroleum. This is to make sure that, there is an increased level of their quality along the protection of the safety and health of consumers. It has to link its management tasks while embracing strategic quality management. Besides, SASO’s mission is “To protect the consumer and to ensure the public interest by issuing and applying standards and quality systems,” (SASO, 2011). SASO task is specialized and technical endeavors to achieve the following. Foremost, is consumer protection; which is achieved through issuing standards as requirements for products, goods and services in Saudi Arabia. Secondly, SASO gives support efforts of development in all industrial and commercial sectors. Besides, SASO protects the consumers’ safety and health throughout increasing imported and national products level of quality. Lastly it also resists fraud and market dumping with counterfeit products. In undertaking the above tasks; SASO employs strategies, for instance, quality control, participation in standards implementation laboratories accreditation and quality management certification (SASO, 2011). The organization was established following a royal decree in 1972 during which time it was formed and made a corporate body with its own budget. In order to be effective, it obtained an International Standards Organization (ISO) 9001 in 2008 certification by implementing the international standards that, ultimately, add value to the customer. SASO has a role to provide consumers with protection and observe the interest of the public. This is through giving and maintaining systems of standards and quality. As the only regulatory body in the country, it is entrusted with various responsibilities associated to standards and measurements. These can only be achieved through the different management strategies employed by both employees and stakeholders of the organization. Additionally, it helps in the development of all industries and commercial sectors. Total Quality Management started in the private sector where its major focal point was to monitors and assesses the organizational activities with the aim of improving business activities to an excellent level. Total Quality Management embodies a holistic means which focuses on a range of organizational activities and production processes. Total Quality Management must be distinguished by its own major principles, practices, as well as techniques. The major beliefs refer to customer focus, continuous improvement of the service delivery and production of goods besides team work (Matei & SĂvulescu, 2011, p. 47). In this light therefore, an organization like the SASO needs to collect data about the customer and then analyze the data to gather information about the customer’s needs. This information can also be used to analyze the organizational processes so that it can improve on the provision of quality goods and services to its customers (Matei & SĂvulescu, 2011, p. 48). This aspect is actually lacking in SASO where less attention is paid to customer and his satisfaction. In achieving this there are a number of areas that SASO needs to concentrate on. These are product quality, process control, quality assurance, as well as quality improvement. These concepts are paramount in addressing customer satisfaction and maintenance thus, should be undertaken together. Goods and services are defined to be of good quality when they are fit for consumption. In this light therefore, SASO should endeavor to make sure that the quality of all the goods that are produced, besides those that are imported to the Kingdom of Saudi Arabia are to the acceptable standards and are fit for human consumption. Quality should be relative to the perception of the customer or. In other words there customer’s perception of the quality of the goods and services are more important than anyone’s perception of the same (Sureshchandar, Chandrasekharan, & Anantharaman, 2002, p. 2). There is a need for the SASO to satisfy both the obvious customer’s needs in addition to those that are implied needs. In an attempt to satisfy the needs of the customer, there are varieties of core concepts of strategy quality management that need to be employed at SASO. Strategic Quality Management emphasizes the following core concepts. These are customer focus, management, planning, constant enhancement of the process, deliberate quality planning, design quality, speed and prevention, people involvement and corporation and fact-based management strategies. (Bossink, 2002). Most of the above, factors are geared towards the satisfaction of the need of the customer. There are some components of Total Quality Management that are discussed below. 1.0 Components of Total Quality Management 1.1 Principle of Total Quality Management In this endeavor, SASO can apply the components of Total Quality Management which include principles, practices, and techniques. Regarding the principle as a component of Total Quality Management; the organization should pay attention to the customer. There should be efforts to provide the customer with products and services that are not only satisfying the customer’s needs but goes beyond the customer’s expectation. In addition, there should be permanent efforts that are meant to improve on the satisfaction of the customer’s needs; which can be maintained by a constant endeavor to improve he production processes that results in the goods. Lastly, under the principles of Total Quality Management; there is a need for team work. This is recognition that a collaborative effort will go a long way in meeting the customer’s needs and satisfaction. Therefore, SASO needs to collaborate with other companies and various stakeholder that produce goods and services (Matei & SĂvulescu, 2011, p. 48). 1.2 Practices of Total Quality Management Besides, there should be a practice that is focusing on the customer needs. There should be continuous attempts to collect data and analyze the same in an effort to find information of the customer’s needs which are yet to be met. Attention should also be paid to non-customers to find out what actually they need that they are not available from the organization in question. Further, there should also be a practice of constant process analysis. There should be re-engineering of the process, finding problems and solving them, planning and re-planning the whole process. Besides, team work should take a center stage with an effort meant to search for measures that benefit all stakeholders in the process. There should be various teams set in place that are mandated with various responsibilities that are meant to ultimately satisfy the needs of the customer (Matei & SĂvulescu, 2011, p. 48). SASO needs to adapt its management to the total commitment to the consumer or the customer through continuous improvement of every process thorough analysis of the data collected and problem solving approaches based on employees, and team work based approaches (Michael, Duane, & Robert, 2009). 1.3 Techniques of Total Quality Management The last component of Total Quality Management is techniques. In this regard, SASO needs to undertake not only customer surveys but also other groups. This process involves data collection; which is processed into information, which can help in discerning their various needs. This will help the organization to develop a function that is then used to translate the customer’s needs into products and services. Moreover, there should be a continuous process control. It is necessary to employ the various process control tools for instance flow charts, Pareto analysis, use of fishbone diagrams and use of a range of Statistical Process Control (Matei & SĂvulescu, 2011, p. 48). The application of a variety of process control mechanisms will help to put the process under control so that effects of the process being out of control are alleviated (Hans-Dieter & Gabriela, 2007, p. 139). Contemporarily, there are some technological developments that involve software application meant to put various processes under constant surveillance and the data conveyed and analysed in real-time; to see if the process is under control or is getting out of control. Such technological developments need to be inculcated in SASO; to improve on service delivery to the customer. Evans observes that successful organizations have developed a culture that is focused on quality besides meeting the needs of customers, various stakeholders and partners. Thus, it is recommended that there exist a culture that values quality products and services at SASO. In addition, it is essential to make strategic plans that support high performance and provision of direction to the entire SASO, that clearly outline various mandates of the various departments in the organization. Moreover, SASO should also consider new technological developments and their implementation within the organization so that it adapts the culture of “best practices”. In addition, there is need for SASO to remain active in the international participation so that it can adapt the present research finding on issues of Total Quality management. There should be a clear commitment to the well being, motivation and developments of the employees so that their performances can be improved (2007, p. 5). These efforts will help alleviate cases of poor understanding of the employees as well as their job satisfaction that is experienced in SASO. According to Samuel, there are some conventional organizational cultures that exist even in SASO. Such cultures are characterized by people or employees blaming each other, finding quick solutions, “I know it all attitude” among many others. These are against the contemporary best practice of Total Quality Management. These practices can be harmful to the management of the organization. Thus, it is necessary SASO eradicates these harmful cultures and adapt Total Quality Management strategies which advocate for the following factors. First every employee should be aware of the vision of the organization. They should own it and endeavor towards fulfilling its aspirations (2004, p. 81). Thus, SASO employees should be aware of its vision which is “To be a distinguished body in all fields of Standardization and quality at the national, regional and international levels.” Further, SASO can adapt Total Quality Management strategies that are characterized by a culture of democratic leadership style which promotes freedom of expression. This advocates for communication that is both top-bottom and bottom-up; in other words, both managers and junior employees are recognized as both important decision makers in the organization. The working environment also needs to be conducive for working and for business purpose. The working environment should meet the required standards that are internationally recognized as well as free from effluence. Besides, there should be proactive measures put in place that take into account any eventuality that might arise within SASO so that it can be dealt with promptly so as to alleviate its effects to the organization. In addition, employees should be understood and their interests, that they say or suggest non-verbally, taken care of. They are also supposed to understand themselves as well so that they can understand others. Besides, the managers need to adopt the empowering-leadership style (Richard L. & Dorothy, 2010, p. 20). The working hour of the employees at SASO must be geared towards adding value to the organization. There is a lack of qualified human recourses in SASO. Besides, there is a poor understanding of the correct procedures among the employees. These consequently results in wastage of working hours of the employees. Thus, it is important to constantly engage the employees in in-service training and clearly outlining the various procedures in all processes in SASO. There is a need to establish a good relationship between the organization and the customer. There should be efforts that are meant to not only satisfy the customer’s wants but also creating a partnership with the customer. This will help in determining the future need s of the customer so that they can be satisfied accordingly. 2.0 The Concept of Customer Value According to Woodside (2008, p. 130) there is no definition of customer value that exists in the current literature. However, he asserts that there are descriptions of what constitute customer value that dwells on the quality and the cost of a focal product exchange. Customer value can also be defined as the emotional connection that is established between the customer and the organization (Raquel & Iniesta-Bonillo, 2006, p. 58). According to Lindman (2010, p. 50) customer value is the difference between the benefits that a customer derivers from the goods as well as services that he receives and the sacrifice he experiences. Therefore, the question that SASO should ask itself is how to create customer value. This calls for an understanding of what actually constitute customer value. There are three sets of models that have been advanced in an attempt to define the various components and importance of customer value. The first set is the value component model. In this model, goods and services are arranged in the mind of the buyer depending on the values that the customer gets from the products and services. Thus, there are those merchandise that are categorized as delighters which the client value most in comparison to other goods; which least satisfy the customer’s needs. The second set of models is the benefit/cost model. This set of models postulates that customers can make decisions on the relative cost of commodities and services and the apparent benefits that they expect to derive from the same. The last set of models is the means/end model. Here, the view is that products form a means along which customers pursue desired ends (Lindman, 2010, p. 49). The concept of customer value is elusive and needs a persistent effort to its understanding. It can be defined as the value that a customer attaches to a good or a service. As a result, it is the definition of value in the eyes of the customer (Saren, 2006, p. 43). This value may be in relation to convenience of goods and the service, the various features of the product, the price of the product or services among others. There is laxity in paying attention to what customer value is in SASO. Besides, there is less attention given to the customer. The concepts of Total Quality Management stress the need of customer focus. This is important to any organization that needs to remain relevant in the contemporary best practices in business. 2.1 Measurement of Customer Value Measurement of customer value is the turning the above analyzed customer value into monetary terms. According to Woodside (2008, p. 184) there are four distinct models of comparative strategies measurements of customer value. These are conjunctive, disjunctive, lexicographic, and ideal profile models. Conjunctive model involves customer’s assessment of the qualities of a number of goods and ranks them in order to see which to accept or rejects. This model of measuring customer value is applicable when the customer is presented with a number of goods or services that the customer is supposed to make a choice. The model aims at eliminating the products that the customer feels is of low value rather than selecting on the goods that are within his preference (Gilbride & Allenby, 2004, pp. 401-402). Disjunctive model is similar to conjunctive model but differ in the number of features that the customer assesses. In this regard, a customer accepts a product when at least one of its characteristics meets the levels that a customer has reestablished entrance level. This model allows a customer who is less involved to make a choice (Wayne & Deborah, 2009, p. 231). Lexicographic model involves a customer ranking the given products with regards to the attribute. Then the attributes are considered in isolation and then ranked in order of the most important. The customer then chooses a product that is of the top ranked attribute. When more than one product are selected in this manner, the same procedure is repeated and other attributes that are second in the customer’s priority list re-considered to eliminate the rest of the chosen products so as to remain with one product (Hoffman & Bateson, 2010, p. 9). The ideal profile model encompasses comparison of products attributes by the customer. This is in an effort to determine the relatively important attribute(s) to the customer. Each attribute is then considered to see which products that closely match the customer’s perceived level of performance. The brand that is closest to the perfect product profile is the one that the customer goes for (Woodside 2008, p. 184). According to Homburg, Steiner, & Totzek there is evolution in quality management and should therefore focus on the management of customer value. This helps in the realization of the changes that need to be implemented in the organization. This is evidenced by the companies. This can eventually be measured using not only the customers’ perspective but others who are non-customers (2009, p. 71) This calls for SASO to measure its perception of quality versus other countries that provide the same services that it offers to the public. In addition, it can also compare its service delivery with the requirements of International Organization for Standardization (ISO, 2011). With such a comparison, then SASO will be able to improve on its quality service provision to its customers. 2.2 Customer Loyalty Customer loyalty can be defined as the customer’s dedication to constantly re-buy or re-patronize a preferred good or services that creates a tendency in the same brand buying in spite of influence of marketing endeavors (Marković, Raspor, & Šegarić, 2010, p. 127). The consistency which customers purchase products and services of a given company depends on the consistency of the company in meeting the needs of customers in question. This should also be in relation to the competitor’s efforts in satisfying the same needs of the customer. In the present competitive world, therefore, a company succeeds more when it offers products and services that surpass the competitors as well as the requirements of the customers (William & Ferrell, 2010, p. 242). The cost of maintaining the customer loyalty is lower than the cost of completely acquiring another group of customers altogether. Hence, it is worth to sustain the existing customers (Dilip & Sara, 2009, p. 90). SASO is the backbone of virtually all industries in the Kingdom of Saudi Arabia because it is mandated with the responsibility of ensuring adherence to quality standards by commercial companies dealing with production of consumer’s goods such as agricultural food products, building materials, electrical and electronic products, construction products, chemical and petroleum products, textile products and mechanical and mineral products in addition to various services. In this respect, there is a need for SASO to ensure customer loyalty so that the customer does not look outside Saudi Arabia for goods and services. Customer loyalty can be affected by different factors, for example, customer’s satisfaction, image of the brand in the market, the relationship that exists between the customer and the supplier as well as the trustworthiness that prevails (Ming-Tien, Chung-Lin, & Han-Chao, 2010, p. 4). Besides, quality of the products or services, and cost can also influence client loyalty (Christos, 2009, p. 165). There is much that needs to be done at SASO to improve on customer loyalty to the organisation; whih presently has deterioriated. Yim, Tse, & Chan observe that the likely reason that firms are unable to create strong customer loyalty is because they are not able to create strong emotional link with their customers. To build a strong customer loyalty, they suggest that the concept of love should be a major force that has driven the world for a long period and is important in launching long lasting relationships. (2008, p. 472). SASO may use this concept to develop a culture of trust to exist between the organization and consumers of commodities and services that bear its mark in and outside the Kingdom of Saudi Arabian. 2.3 The Relevance of Customer Loyalty Customer loyalty is important in stimulating market share and profit maximization (Rajagopal, 2006, p. 19). Understanding customer loyalty is paramount in determining the amount of spending that a company invests in marketing activities. There is business intelligence software that can be used by organizations to determine customer loyalty. This software is used to understand the psycho-demographic attributes out customers (Cokins, 2006, p. 17). It is recommended that SASO to use such a state of the art software to analyze its customer base. The information that is gathered can be used by the organization to improve on its services to customers. Customer loyalty is important because the loyal customer gives the company more profit. Loss of such a loyal client may mean huge loss of the profit that might have accrued from the customer purchases. Thus, for the growth of Saudi Arabian economy, it is imperative that SASO ensures that goods are of high quality so that customers do not look for imported goods (Timo, 2007, p. 11). Conclusion Total Quality Management culture needs to be adapted at SASO. This culture is characterized by the democratic leadership, a good working environment, employees being aware of vision, as well as the objectives of the organization. Moreover, there should be proactive measures put in place for any eventuality. Team work and inclusion of all stakeholders are more important so that they feel valued within the organization. The stakeholders include the customers, partners, various arms government, and the employees. In addition, SASO should make efforts to not only satisfy the needs of the customers but also establish a long lasting relationship with the customer so that his or her future needs are catered for. The process at SASO needs to be kept under constant surveillance so that when the process is going to be out of control it is noticed earlier and the necessary measures are put in place to bring it back under control. Customer value needs to be measured and the satisfaction of the customer should be among the most important issues that SASO is supposed to constantly reflect on and attempt to achieve. There should be a sense of ownership that prevails within the employee and other stakeholders. This elicits a willingness to commit to achieve the objectives of SASO which eventually will culminate to the eventual realization of its vision. References Bossink, B. A. (2002). The Strategic Function of Quality in the Management of Innovation. Total Quality Management, 13 (2), pp. 1-12. Christos, F. (2009). Proceedings of the 2nd International Conference: Quantitative and Qualitative Methodologies in the Economic and Administrative Sciences. Athens: Christos Frangos. Cokins, G. (2006). Measuring Customer Value: How BPM Supports Better Marketing Decisions. Business Performance Management, 4 (1), pp. 13-18. Daft, R. L. and Marcic, D. (2010). Understanding Management. Mason: Cengage Learning. Dilip, S., & Sara, N.-M. (2009). Managing Customer Value: One Stage at a Time. Singapore: World Scientific. Evans, J. R. (2007). Quality and Performance Excellence: Management, Organization, and Strategy. Massachusetts: Cengage Learning. Gilbride, T. J., & Allenby, G. M. (2004). A Choice Model with Conjunctive, Disjunctive, and Compensatory Screening Rules. Marketing Science, 23 (3), pp. 391-406. Hans-Dieter, B., & Gabriela, L. (2007). Multi-Agent Systems and Applications 5. New York: Springer. Hoffman, K. D., & Bateson, J. E. (2010). Services Marketing Concepts, Strategies, & Cases. Mason, OH: South-Western Pub. Homburg, C., Steiner, V. V., & Totzek, D. (2009). Managing Dynamic in Customer a portfolio. Journal of Marketing, 73 (5): pp. 70-89. Hoyer, W. D. Macinnis, D. J. (2009). Consumer Behavior. Mason: South-Western. ISO. (2011). ISO-International Organization for Standardization. Retrieved May 12, 2011, from International Organization for Standardization: http://www.iso.org/iso/home.html Marti, L. (2010). Extending Customer Knowledge: The Value of Customer Value-Based Approach. Journal of Global Business & Technology, 6 (2): 48-63. Marković, S., Raspor, S., & Šegarić, K. (2010). Customer Satisfaction and Customer Loyalty Measurement in Hotel Settings: An Empirical Analysis. Tourism & Hospitality Management Conference Proceedings,125-137. Matei, A., & SĂvulescu, C. (2011). Convergence of the Policies for Promoting Total Quality Management in the Public Administrations of Balkan States: European Union Member States. Theoretical & Applied Economics, XVIII, No. 3(556), pp. 41-76 47-76. Michael, A. H., R. Duane, I., & Robert, E. H. (2009). Strategic Management: Competitiveness and Globalization : Concepts & Cases. Mason, OH: Cengage Learning. Ming-Tien, T., Chung-Lin, T., & Han-Chao, C. (2010). The Effect Of Customer Value, Customer Satisfaction, And Switching Costs On Customer Loyalty: An Empirical Study Of Hypermarkets In Taiwan. Social Behavior and Personality, 38(6): pp. 729-740. Rajagopal. (2006). Measuring Customer Value Gaps. Economic Issues, 11 (1): pp. 19-40. Raquel, S.-F., & Iniesta-Bonillo, Á. M. (2006). Consumer Perception Of Value: Literature Review and a New Conceptual Framework. Journal of Consumer Satisfaction, Dissatisfaction & Complaining Behavior , 19: pp. 40-58. (no issue number). Samuel, A. A. (2004). Total Quality Management. New Delhi: Prentice-Hall of India. Saren, M. (2006). Marketing Graffiti: The View From The Street. Burlington: Butterworth Heinemann. SASO. (2011). Saudi Standards, Metrology and Quality Organization. Retrieved May 13, 2011, from: http//: www.saudi.gov.sa/.../viewOrg?...saudi%20arabian%20standards%20organization Subburaj. (2005). Total Quality Management. London: Tata McGraw-Hill Education. Sureshchandar, G. S., Chandrasekharan, R., & Anantharaman, R. N. (2002). The Relationship Between Management's Perception Of Total Quality Service And Customer Perceptions Of Service Quality. Total Quality Management, 13(1): pp. 69-88. Timo, K. (2007). Customer Loyalty Program - Tourist Destination and Bonus Card System. Norderstedt: GRIN Verlag. William, M. P., & Ferrell, O. C. (2010). Foundations of Marketing. Ohio: South-Western Cengage Learning. Woodside, A. G. (2008). Creating and Managing Superior Customer Value. Bingley: Emerald Group Publishing. Yim, C. K., Tse, D. K., & Chan, K. W. (2008). Strengthening Customer Loyalty Through Intimacy and Passion: Roles of Customer–Firm Affection and Customer–Staff Relationships in Services. Journal of Marketing Research, 45 (6), pp.741-756. Read More