CHAPTER ONE
INTRODUCTION
1.1BACKGROUND OF THE STUDY
Embarking on the total quality management
(TQM) phenomenon is a call for organizational excellence. The phenomenon which
started spreading like wild fire across the Globe in early 1980 has been
spurred on by the fierce competitions raging between companies of Japan, North
America and Europe. Japan which occupies
only 0.3 percent of the world’s land surface and has only 2.7 percent of the
world’s population with no natural resources, recorded in early 1980 overall
percent of the world’s gross national product. That was the period the Japanese
were like to the American’s and Europeans by lending and selling quality
products at prices lower than what it was costing the Americans and
Europeans to produce them.
TQM is a customer forced performance
enhancing tools which can be applied to any type of organization. It balances
the diverse elements of business (leadership,
strategic, planning, human resources development and management, work
processes, management, information system, external customers, employees and
stakeholders) and aligns them to achieve excellent business
results.
TQM aims at achieving increasing
better production and services at progressive competitive prices, with
minimum production or service cost. It involves doing things right in an
organization on the first try, rather than making and correcting mistakes.
By focusing on doing things right at the first time, organization will avoid
the high cost that is associated with re-work. Many people perceive attention
to quality as one of the most important competitive issues of today and
tomorrow. In fact, quality may be one of
the most important ways a manager can add value to products and services to set
them apart from those of competitors.
Most business organization within the
manufacturing and service industries have in one time or the other experienced
a drop in their level of productivity while some are still suffering from it
today. At one time, managers believed that there was an inevitable trade
of between productivity and quality. They thought that the two were
diametrically opposed, that is, increasing one meant decreasing the other.
Today however through a systematic application of TQM, effective managers
consider productivity and quality as two sides of the same coin -
increasing one meant increasing the other. Productivity simply means the ratio output
(that is the quantity of goods and services produced) to input (that is
the quantity of labour, capital, energy).
A manufacturer is faced with the
problem of product development or modifications that do not meet the required
specifications of a quality product, embodies all its characteristics would
definitely have to device a means of preventing waste, cost re-mark. In such a
situation, the ratio of resource input would be higher than what the
manufacturers produces as output. More also, resources will be wasted as a
result of rework in trying to manufacture a quality product. This level of
productivity would be adversely affected, similarly, in the service industry,
firms that render quality customers services are also confronted with
the problems of cost of quality which makes it difficult for them to achieve a
positive growth of productivity. This is because in rendering these
quality services, there are six categories of cost which a firm must be able to
prevent or control if it is to maintain a growth in productivity. But through
the application of total quality management (TQM), a firm can comfortably
render quality service and also increase its productivity level. The categories
of cost of quality are discussed below:
1.
The cost of activities: These are
designed to ensure conformity to agreed customer requirement of cost of goods
quality.
2.
The cost of activities two: This very cost results from
failure to conform to agreed customer requirements-cost of non-conformance or
cost of bad or poor quality.
3. The cost of lost opportunities: This is
the cost of lost sales.
These are the cost of activities,
additional to a basic work process used in a business according to Akpeiyi
(1996).
As already mentioned, total quality
management (TQM) is a management concepts that leads to achieving the best
result on the first try. It stresses on doing the right thing at the first time
and every time. It eliminates wastes, scrapes and also enables a
company to avoid the problem of rework of alternative be it a manufacturing or
a service company. Total quality management prevents problems from occurring by
creating the attitude and control that make prevention possible and also builds
a philosophy of continuous improvement, efficiency, productivity and long terms
success.
1.2STATEMENT OF THE PROBLEMS
For total quality
management to be successful, there has to be management commitment to it. In
many cases where total quality management is practiced, management often shows signs
of greater commitment or determination to achieve the success. Most of the
companies that practice total quality management pursued their total quality
management efforts for 10 years before seeing returns. This may be due to
pressures faced by management to set priorities that will help to maintain or
improve company’s performance.
Total quality management
application requires that management dedicate time, money, labour and other resources,
since this is the case, total quality management often conflicts with higher
priorities or initiatives. Consequently, management may out of necessity or
convenience redirect its attention or resources to other priorities.
Another problem that is
associated with total quality management practice which invariably has a
dwindling effect on productivity is lack of skill and knowledgeable personnel. Not
everyone in a company has the prerequisite attributes to make total
quality management a reality. Necessary attributes include a special knowledge
of the business processes, a background in statistics or some mathematical
aptitude, the capacity to work as a team member, the ability to communicate
effectively and the ability to take advantage of business opportunities.
It has also been observed
that most organizations fail to develop a plan that outlines how to make total
quality management a part of the company.
Furthermore, it appears
that the general feeling concerning total quality management is that employee
co-operation is not recessively needed. Total quality management is seen as a
culture which requires management to loosen reigns and give employee greater
role in managing the firm. To make total quality management successful, it
requires greater involvement by the people doing the work.
1.3 OBJECTIVE OF THE STUDY
This work deals on the following
objectives:
1.
To determine the extent at which total quality management (TQM) has influenced
the productivity of the company (First Bank Nig. Plc)
2.
To determine the extent at which the application of TQM affects the prices of
goods and services, and what are the reaction of customers.
3.
To know if application of TQM in First Bank Nig Plc has yielded negative or
positive impact in the organization
4.
To know if First Bank Nig. Plc adheres to the principles, methods etc. of the
total quality management (TQM).
1.4 SIGNIFICANCE
OF THE STUDY
The importance of this research work is to
contribute to the method of enhancing productivity in business organizations
through the application of total quality management. This study focuses on the
principle of employee empowerment, which is one of the principles on concept of
total quality management (TQM) as a means of enhancing productivity in the
organization. In most organizations, the low performance is due to the non-chalet
attitude of the workers.
Through the concept of the employee
employment, (TQM) provides a means of motivating the workers for higher
performance by giving employees the opportunity to make decision without asking
for approval from their immediate managers. The employees therefore act as
their own managers, set objectives for themselves and also take the
responsibility for achieving such objective. When this is the case, they enjoy
a sense of belonging in the organization as they are now part of the decision
making process in the organization.
It is hoped that by discovering efficient
ways and methods for improving productivity, the organization will make maximum
use of its resources and avoid wastages. From the fore-going, the research will
attempt to make recommendations to the management of First Bank Plc.
1.5
RESEARCH
QUESTION
This research questions is a guide and it
serves as an objective for the researcher in the course of this study. The
research questions are as follows:
1.
To what extent has total quality management (TQM) influenced the productivity
of the First Bank Nig. Plc?
2.
How does the application of TQM affect the prices of goods and services, and
what are the reactions of customers.
3.
Has the application of TQM in First Bank Plc, yielded negative or positive
impact in the organization?
4.
Does First Bank Plc adhere to the principles, methods etc. of the total quality
management (TQM).
1.6 RESEARCH HYPOTHESIS
In
order to achieve the objectives of the study, the following hypothesis are
formulated as follows:-
1. Ho
: Total Quality Management
does not influence productivity
of First Bank Nig. Plc .
H1
: Total Quality Management does
influence productivity of First Bank Nig.
Plc
2.
Ho : Application of Total Quality Management does not affect
goods and services quality
H1 : Application of Total Quality Management does affect goods
and services quality
1.7 SCOPE AND LIMITATION OF THE STUDY
The study is being conducted in Abuja, the
Federal Capital Territory of Nigeria with reference to First Bank Nig. Plc,
Wuse, Zone 2, branch. The features of interest will include time, types of
services rendered, time lines, consistency, accessibility, convenience, image
etc..
To make the research work more reliable and
valid, the sample study will cut across top management and middle management
but particular emphasis would be on the top management due to the nature of
subject being addressed.
Limitations
are to be stated after more research has been done on chapters 2, 3 and 4.
1.8 DEFINITION
OF TERMS
The following are the definition of terms
used in the study in order to achieve clarity, avoid misconception and
ambiguity:
TQM: = Total quality management
ORGANIZATION
EFFECTIVENESS: = customer satisfaction
QUALITY
POLICY: = it is
set of values by which TQM implementation will be successful.
ZERO
DEFECT: =it is the result of doing the right
thing, right, the first time and always.
QUALITY
CONCEPT: =TQM
FBN:
=First Bank Nig. Plc
QC
=Quality circles
Q-D-P:
=Quality delivered process
SERMON:
=what TQM advocates
No comments:
Post a Comment