Flashcards in Chapter 3: The operations management function Deck (5)
Total Quality Management (TQM)
An ongoing, organisation-wide commitment to excellence that is applied to every aspect of the organisation's operation.
Quality becomes both a commitment and the responsibility of every employee in the organisation. The aim of TQM is to create a defect-free production process, and maintain a customer focus in operations. The adoption of TQM can improve the price competitiveness of an organisation, but can also improve product quality, allowing the business to attain competitive advantage. To achieve TQM objectives, a number of approaches may be used. For example, employee empowerment, continuous improvement and improved customer focus.
Consists of all the activities in which managers engage to produce goods or services. For example, strategic planning.
Three areas of operational competitiveness
- Compete on Quality, such as evaluating processes to ensure minimal defect rates.
- Compete on Cost, such as ensuring stable production processes with limited interruption.
- Compete on Speed of delivery, such as developing faster feedback mechanisms.
Productivity is the total value of outputs produced by the transformation process divided by the total cost or amount of inputs.