CHAPTER II: LITERATURE REVIEW

Transcription

1 CHAPTER II: LITERATURE REVIEW There is natural scepticism among managers towards quality initiatives, and not without reason. Many organizations each year commit vast amount of time and effort to improving business performance, without any lasting or measurable results. Gurus ideas are result of their life-time understanding and experience about quality that could be used by every individual and organization, and their values are tremendous. -Samuel K.M. Ho [100, p.16] Chapter one briefly explained the research background and also described the research objectives. This chapter reviews the relevant literature which underpins this research and describes how this research relates to existing works on quality management and quality practices, approaches to adoption of quality, models of quality practices, relationship between quality and performance. In the literature review, the combination of these five major disciplines provides the theoretical background to the research design for this study as shown in Figure 2.1 QM Practices Critical factors of QM Evolution of QM and Performance Implementation and approaches for Adoption Figure 2.1: Five major disciplines in the Literature Review The international and regional differences and some themes, for example TQM, remain popular in Asia, whilst their popularity has declined in other regions. According to a number of sources (literature, surveys, and research studies), ISO 9000 and TQM practices are two main approaches used by many companies. Having accepted that

2 there are some irrational influences on the selection of QM initiatives, the literature in QM has disagreed with the fixed model and has suggested a rational decision based on the company s objectives and situation. Both ISO 9000 and TQM theories have formed an initial background to the Practices selection framework. However, The Business Excellence Models like MBNQA and EFQM also becomes popular in recent days, along with ISO certification and TQM programmes at both large and small scale levels of manufacturing. 2.1 Evolution of Management QM can provide a clearly defined structural frame work in which all organizational activity occurs- a must for empowered self-directed or cross-functional work place teams, multi-skilled flexible workforces, or dynamic workplace environments -Dennis Grimwood [79, p.2] Throughout the 1980s and 1990s, effective QM represented a key competitive advantage [92] and its concepts were developed in parallel with the evolution of new operations management ideas, the emergence of new quality-related techniques. QM evolution can be divided into five major phases or stages: (1) Inspection, (2) Statistical Process Control (3) Assurance, and (4) Strategic Management, and (5) competitive continuous improvement (43, 71). Management itself is a term referring to coordinated activities which direct and control the quality of product and services of an organisation. QM typically includes the establishment of quality policy and objectives together with quality planning, control, assurance and improvement. Over two decades ago, Hodgetts et al. (1994) depicted modern organisations as those which made a fundamental shift from a Total (TQ) paradigm towards a Learning Organisation (LO) and later extended this theme, suggesting that organisations must sustain major improvements, maintain high performance and aim towards being an Excellent-Sustainable organisation (as cited in 158, p.768). Table 2.1 summarises the action, focus, methods & concepts and other characteristics of each quality era. Prior to the 90s the organization could be described as basic, i.e., it was focused on survival. The top management and a few employees dealt with the customer. For most employees, there was a distinct lack of awareness of the customer

3 needs. The approach was top-down with instructions provided by top management that were executed by the rest of the company. There was no approach to improvement, the goal was to maintain status quo. Today, in many organisations, QM is employed in a broad context of organisational excellence and business development. Hence, current QM approaches tend to be systematic, holistic and company-wide, and linked to corporate strategy [38]. Nevertheless, the main objective of QM implementation remains the continuous improvement of process management, hence advancing an organisation s operating performance, developing Operational Effectiveness [59] and organisational excellence, ultimately leading to enhanced stakeholder satisfaction. Hence, it was defined by Srivastava Lakhe, and Mohanty [202] that recent stage, related to QM, emphasises the importance of the flexible organisation, responsive and able to adapt quickly to changes, responding to customer feedback and benchmarking against competitors. QM themes remain very significant in business, although the concept has been broadened and is now often expressed in the language of business or organisational excellence [203]. According to Kodali, Anand, and Sunnapwar [192], QM has been woven and absorbed into broader business management themes (developing together towards a goal of building excellent-sustainable organisations). In past, Cole (32, p.47) explained that: By the mid-and the late 1990, quality disappeared as a major topic in the media and was less and less a focus of top management s attention. This is a natural process manifested in the growing normalization of quality improvement as a management activity. In this process, simplified versions of the more formal and often complex quality methodologies gradually evolved. At the same time, the ISO 9000 series standards showed extraordinary growth and application, and represent, perhaps, one of the most remarkable international standardisation efforts ever attempted. Companies using ISO 9001 as their major QM theme are typically smaller and less developed in organisational terms, but many of them subsequently aspire to TQM or excellence awards. A broad historical perspective shows that QM approaches have emerged as a number of waves, with different origins, spread, time-scales and influence. Figure 2.2 attempts to illustrate the origin of key QM approaches along with the evolution of the organisational paradigm over time. Since

4 1960, many QMS were proposed by considering organizational development aspects from adaptive level of total quality (TQ) to excellent-sustainable organization. Table 2.1: Five major phases of quality evolution (Adapted from Garvin) [71] Identifying Characteristics Inspection Stages of Movement Assurance Statistical Control Strategic Management Competitive Continuous Improvement Scope Product Process Total Excellentsustainable Organisation Action Reactive to quality problems Proactive or preventing quality failure Focus Orientation Methods & Concepts Conformance to specifications "Inspect" quality Gauging and measurement Conformance to Customer Control" quality Statistics: SPC Sampling Plan Process Improvement Reduce waste & cost JIT Do It Right the First Time Measure Finished goods In-process Measurement Primary Concern Target in production Key responsibilities Operating Philosophy Total customer satisfaction: product, process, system assurance "Build in" quality Management practice: QCC, TQC, TQM (Kaizen) Control Plan Capability study DOE, MSA, FMEA Entire production Chain Customer comes first: strategic and management "Manage" quality CQI by integrating management practice with process improvement ISO9000 series Six Sigma Re-Engineering Lean production management System Flexible, Responsive, Adapt quickly to changes Continuously add value to organization's stakeholders CI in" quality Self assessment (MBNQA, EFQM, Deming prize, Balanced Scorecard) Benchmarking Product &process design (QFD, Design for six sigma- DFSS) Advanced statistics Stakeholder satisfaction Inspection Detection Coordination Strategic impact Continuous Improvement No standard Achieve AQL Zero Defect Inspector craftsman to mass production department Mass customization Active involvement of entire organization flexible specialization

5 Japan and the USA have pioneered and developed most of these methods; but they travel across the globe and have been adopted and adapted in countries with different industrial cultures. Internationally, differences in QM implementation and timing continue. For example, using a combination of traditional Kaizen and Lean production over the period from 1994 to 2001, Japanese automotive plants showed remarkable productivity improvement and defect rates reduction, compared with those in the United States and Britain [199]. During the same period, the impact of TQM to force radical organisational change was felt most strongly in the USA, and to some extent Europe. Currently in the USA, Six Sigma, Lean and TQM (including MBNQA) appear to be the best-liked concepts [120]. In Europe, the ISO 9001 and TQM are quite popular along with EFQM excellence model, and in Asia the ISO 9000, Kaizen, 5S and TQM are favourite techniques, along with several quality award models in line with MBNQA and EFQM [153] Figure 2.2: QM approaches along with the evolution of the organisational Paradigm Definition of Management Practices Over the last thirty years, many studies have discussed the reasons for inferior quality in industries and have recommended quality improvement prescriptions in form of quality management practices (11, p.25).the QM literature is replete with studies that addresses quality management practices (QMP), not only in western

6 hemisphere, but also round the globe. Studies by Flynn et al. [67] Ahire and Golhar [13], Black and Porter [27], Dahlgaard et al. [43], Samson and Terziovski and Samson [232], Anderson and Sohal [17], Sun [222], Costa & Lorente [147], Khanna et al. [125], Karim [121] represents an example. In the attempt to define quality management practices, Zeitz et al. [256] refers to quality adoption practices as specific practices that has been adopted, but which lacks entrenchment. Dale et al. [46] defined the term entrenchment as the presence of a practice within organization such that abandonment of it is unlikely, even under extreme pressure. At broad spectrum; Youssef, Koch and Dolan (252, p.946) define quality management practices as those: techniques and behaviours entrenched within an organization or its sub-units under two conditions. First, these techniques and behaviour are in congruent with criteria established by International Standardization Organization (ISO) or they are embodied in a framework of national or international quality award frameworks such as those of MBNQA or EFQM. Second, these techniques must help organization or its sub-units achieve a sustainable competitive advantage at both operational and strategic levels- that is they impact the business performance of an organization or one or more of it sub-units Critical factors (Constructs) of Management Practices The review of literature indicated that many divergent perspectives which constituent quality management practices or constructs also consented by several scholars as critical factors. Benson & Saraph et al. (25,185) established seven factors of QM and paved the frame work for how to best cut the TQM cake into factors or elements. Black and Porter [27] conducted factor analysis on a questionnaire administered to quality practioner, to establish the list of ten factors that are described as critical to TQM. Ahire [11] also developed a model using similar techniques of Black and Porter [27], to provide ten constructs of TQM. They defined these constructs as latent variables, which cannot be measured directly. However, critical factors or constructs can be measured indirectly from their manifestations. For example, customer focus is a critical factor that cannot be measured directly and when a company is customer-focused, manufacturing managers will be aware of the results of customer satisfaction surveys. Thus, manufacturing managers being aware of customer

7 satisfaction surveys can be one of the manifestations of the critical factor customer focus. Studies also reflects that several frameworks have defined these critical factors/constructs as TQM elements and TQM measures [17, 18, 51, 66, 113, 167, , 213]. Wali, Deshmukh, and Gupta [243] in recent study of critical factors of quality practices defined top management support as main driver for QM implementation for creating the values, defining the organizational goals to satisfy the customers. In many studies, customer satisfaction is consented as second most important factor which provides the measures for organizational efforts and effectiveness. In past, while comparing the several TQM frameworks, Mohanty and Lakhe (142, p.124) mentioned about the success and failure of TQM implementation in firms, is dependent on hard and soft elements; which are nothing but critical success factors of QM and quality practices. Khond and Dabade [127] have stated that, a TQM programme would lead to a continuous improvement culture. Elements of TQM can be grouped into two dimensions management system or soft part and technical system or hard part. Without both elements, TQM would not be successful. Sila & Ebrahimpour [214] have analysed and compared 76 empirically validated TQM factors and their impact on various performance measures across countries. The findings showed that top management commitment and leadership, customer focus, information and analysis, training, supplier management, strategic planning, employee involvement, human resource management, process management, teamwork, product and service design, process control, benchmarking, continuous improvement, employee empowerment, quality assurance, social responsibility, and employee satisfaction were the most commonly extracted factors across these 76 studies. They covered most of the empirical studies; focusing QM research up to the year 2002.Their analysis is presented in Appendix 2.1. The list of critical success factors mentioned in their studies representing the investigations from 23 countries also presented in Appendix 2.2. For recent studies in QM, researcher referred more than 600 research articles published up to 2009, in the peer reviewed journals like Total Management and Business Excellence (Formerly Total Management), International Journal of

8 and Reliability Management, International Journal of Operation and Production Management, Management Science, Decision Sciences, Australian Journal of Management, Asia pacific Journal of Management, Management Journal, The TQM Magazine, International Journal of Business management, International Journal of Business Excellence, Journal of Operation Management, and Reliability Engineering etc. From the past and recent work researchers have abstracted empirical studies consented in recent literature of QM associated with framework of critical factors and presented Table 2.2. It is important to mention, that this list is substantive and only represented different types of critical factors used in QM literature in recent past. Table 2.2: Different Critical Factors of QM Practices proposed by scholars SN Author/s No. of Critical Success Factors CSFs 01 Saraph et al.(1989) 07 Top Management leadership, data reporting, Process Management, Product/services design, Supplier Management, Role of quality Department,Employee Relation 02 Flynn et al.(1994) 07 Top Management support, information, Process flow Management, Product design,workforce Management, Supplier Involvement, Customer Involvement 03 Flynn et al.(1995) 06 Top Management support,process control, Employee Involvement, New product quality, Concurrent Engineering.SPC/feed back maintenance 04 Powell (1995) 10 Executive commitment, Measurement, Zero defect Mentality, Process Improvement training, Clos to supplier, Employee involvement, Open organization, Flexible Manufacturing, Closer to Customer, Benchmarking 05 Ahire (1996) 10 Top Management support,internal quality and information usage, Design quality management, Employee training, Supplier quality management, Employee involvement, Employee empowerment, Employee training, Customer focus, SPC usage 06 Black and Porter (1996) 09 Benchmarking, Strategic Management, improvement measurement, Communication, Operational quality Planning, External interface Management, Supplier Partnership, People and customer Management, Customer satisfaction orientation 07 Choi and Eboch (1998) 04 HRM practices, Process quality, Information analysis, Performance 08 Samson and Terziovski (1999) 06 Leadership, HRM practices, Customer focus, Information and Analysis, Process improvement, Strategic quality Planning 09 Dow et al (1999) 08 Workforce commitment, Shared vision, Use of teams, Personal Training, Customer focus, Supplier

9 10 Yusoff and Aspinwall (1999) relationship, Use of benchmarking, Use of advanced manufacturing systems, 10 Management leadership, Continuous improvement systems, Education and training, Supplier quality management, systems and processes, measurement and feedback, Human Resources Management, Improvement tools and techniques, Resources, Work environment and culture