TOTAL QUALITY MANAGEMENT DIFFUSION IN SEWN PRODUCT MANUFACTURERS. Dianna J. Vass, David Herr University of North Carolina at Greensboro

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1 TOTAL QUALITY MANAGEMENT DIFFUSION IN SEWN PRODUCT MANUFACTURERS Dianna J. Vass, David Herr University of North Carolina at Greensboro ABSTRACT: Education and training in manufacturing is very important to diffuse new business strategies, such as Total Quality Management (TQM). A sample of 523 XX (state) sewn product manufacturers each with more than 25 employees was mailed a questionnaire. Unadjusted response rate was 27%, and adjusted response rate was 33% (n = 143). One-way analyses of variance (ANOVA) were used to examine the association between the environment and characteristics of the organization and the diffusion level of TQM. Quality focus of suppliers and customers did significantly affect the TQM diffusion score. Additionally, management attitudes about TQM and training strategies were significantly affected the TQM diffusion score. However, the type of product produced did not significantly affect the TQM diffusion score. This study measures the current level of TQM diffusion in sewn products manufacturing and sheds some light on what are the important environmental and organizational components of successful TQM diffusion. INTRODUCTION A manufacturing company that possesses many complexities can be highly challenged when maintaining production goals and standards in conjunction with a major organizational change. Sewn products manufacturing is a complex industry for many reasons. The product line is a complex array of styles, seasons, varying life cycles, and multidimensional sizing. [Schottmiller, 1997] Many sewn product firms are viewing TQM as the appropriate strategy to meet the double demand of competition and quality; however, many companies are finding sustaining their TQM adoption decision very difficult. Additionally, TQM s contribution to a competitive advantage remains unexamined with the context of management and organizational development research. [Powell, 1995] This article examines TQM diffusion in organizational settings drawing on management research literature and empirical evidence and reports findings from a new empirical study of TQM diffusion in a manufacturing setting. RELATED LITERATURE TQM frameworks need to be established to serve as guides for successful TQM implementation. A framework for this research is presented in Figure 1. The TQM diffusion model examines the three major factors that jointly influence the TQM diffusion pattern: (1) the environment, (2) characteristics of the adopting organization and (3) characteristics of the strategy itself. [Figure 1]

2 Environment Organization TQM Strategy The Environment Figure 1. TQM Diffusion Model Maintaining a global competitive advantage involves environmental or supply chain issues such as establishing a strong network of suppliers, and focusing on diverse customers that desire unique products. [Almaraz, 1998] Supplier Influences. The traditional criterion for selection of suppliers was financial costs as compared to the last year s performance. [Butz, 1995] This criterion was useful when markets and technology were predictable, but today s environment requires suppliers to be agile in addition to being price competitive. [Bolden, Waterson, Warr, Clegg, & Wall, 1997] An organization s relationship with its suppliers is driven by value and the relationship s outcome is a financial end result that must be mutually beneficial so that all parties can remain in business. [Butz, 1995] Customer Influences. The very existence of a company depends on its customers, and a customer s opinion is critical for survival in the value chain. [Butz, 1995] For sewn product manufacturers, the needs of customers have diversified and changed in recent years. [Schottmiller, 1997] For one sewn product, the next link in the value chain could be another sewn product manufacturer, a distributor, a retailer, a final consumer or a combination of any of these. The Characteristics of the Organization Strategic management focus has shifted away from competitive positions and toward internal, firmspecific factors. [Powell, 1995] According to Porter [1979] and Rogers [1995] the type of product that is being manufactured, training of employees, the management attitudes within the company, can characterize organizations. These three types of demographic characteristics were used in this research. Products. The type of product an organization manufactures is an organizational demographic that distinguishes the company within its manufacturing sector. [Dickerson, Dalecki, & Meyer, 1991; Kincade & Cassill, 1993; Ko, & Kincade, 1998; Schottmiller, 1997] This study examined sewn products among categories of product category, fashion position, and product innovation. Training of Employees. Rapid technological change has forced an evolution both in the nature of work and in how people are prepared for that work [Berszinn, 1994]. Sewn products line workers must learn the skills of several jobs and make rapid transitions from one to the other. Greater job demands call for increased training. [Berszinn, 1994] Management Attitude. Positive and supportive management attitudes about TQM have been empirically shown to be important to how well TQM is diffused throughout an organization. [Almaraz, 1998] However, traditional management philosophies in the sewn products industry did

3 not widely nor clearly communicate attitudes and information to organizational members. This communication gap is historically linked to the secretive nature of the industry which is in rooted in the industry s low barriers to entry and high fragmentation of products. [Ghadar, Davidson, & Feigenoff, 1987] Characteristics of the TQM Strategy Adoption of TQM comes from an authority decision, usually from senior management; yet in order for TQM to be successful, a collective decision to adopt TQM has to be made. [Rogers, 1995] Planning and maintaining a TQM change has to be communicated to employees over a long period of time. [Weaver, 1995] While maintaining TQM, the organization as a whole and its major internal divisions have to update the change so that TQM retains a current and fresh meaning to each individual employee. This employee involvement enables the entire organization to continuously improve its TQM diffusion level. [Weaver, 1995] Several researchers have identified four stages of TQM. [Cupello, 1994; Weaver, 1995] While the names of the TQM diffusion stages may be different, they do follow a maturity hierarchy from planning to awareness to improvement to innovation. Cupello [1994] and Weaver [1995] maintain that organizational success of TQM diffusion comes from methodically, sequentially following the stages allowing enough time to mature in each stage. Failures occur when stages are skipped or initial TQM diffusion is started too high in the hierarchy. METHOD This research examined the relationship between environmental characteristics, company characteristics and diffusion of TQM as proposed in the following hypotheses. H1 Quality focus of suppliers is related to the diffusion level of TQM. H2 Quality focus of customers is related to the diffusion level of TQM. H3 Type of product produced is related to the diffusion level of TQM. H4 Training of employees is related to the diffusion level of TQM. H5 Management attitudes about the importance of TQM is related to the diffusion level of TQM. Sampling and Data Collection A sample of 523 XX (state) sewn product manufacturers with more than 25 employees was purchased from Harris Selectory. The Harris Selectory updates its mailing list on an annual basis and original data was based on US Census data. The 523 sewn product manufacturers were mailed a questionnaire. Dillman s [1978] total design method was used for data collection. Mailed questionnaires were used to survey plant managers. A thank you/reminder postcard was mailed one week after the initial mailing. A second mailing occurred at week three. Follow-up calls were made to increase response rate and investigate reasons for non-response. Instrument A questionnaire was developed and pilot tested for the study. Forced-choice questions about the environment, characteristics of the TQM strategy and characteristics of the organization were used. Questions for this instrument were based on previous research survey, trade literature and academic

4 literature. [Crosby, 1984; Cupello, 1994; Dean & Bowen, 1994; Deming, 1986; Feinburg, 1996; Ko & Kincade, 1997; Matta et. al., 1996; Powell, 1995; Schottmiller, 1997] Supplier influences and customer influences measured the environment of sewn products industry. Questions in this section were derived from management and organizational development research. [Dean & Bowen, 1994; Deming, 1986; Powell, 1995] Characteristics of the organization were measured by product characteristics of product category, fashion position and fashion innovation. Major sewn product categories were classified into: (1) Women s wear; (2) Men s wear; (3) Children s, Infants wear; (4) Home Products; (5) Unisex apparel; (6) Component manufacturers; and (7) Other. Fashion position was classified according to how much style changes within a particular product. Fashion Position was classified into four ordinal categories: (1) Highly fashionable; (2) Fashionable; (3) Fashionable and Basic; and (4) Basic. Product innovation determines the frequency and extent of change in production. [Kincade & Cassill, 1993] Product innovation was classified into four categories: (1) More innovative with frequent changes; (2) Fairly stable with a few innovations; (3) Well focused and relatively stable; and (4) Changes made in response to competition s products. Management attitudes, an organizational characteristic, were first measured by agreeing or disagreeing with the statement TQM is not a fad. Management attitudes were measured in a second question that inquired, Do most leaders in the industry practice what they preach regarding TQM? Training, an organizational characteristic was measured by the questions: Has TQM training been offered to operators/production workers? How important is TQM training for new employees? and How important is TQM retraining for all employees? A TQM Diffusion score was based on a quality process list designed by the Continuing Education Subcommittee of the American Apparel Manufacturing Association (AAMA) Education Committee [ Process must begin with quality, 1995] and Powell s [1995] twelve TQM factors and his empirical evidence of TQM behavorial features. Powell s [1995] scale focused on employee empowerment, measurement of TQM, zero defects, process improvement, flexible manufacturing, adoption of TQM philosophies and customer relationships. This scale was merged with the AAMA list in order to correspond to sewn products manufacturing that is characterized by labor intensive, highly changing product. The final diffusion score included three types of TQM activities: (1) Measurement of quality; (2) Company quality philosophy; and (3) Change of employee roles. The Measurement of Quality category had questions regarding Measurement tools, Repair/Rework and Production Standards. The Company Quality Philosophy category had questions regarding Quality Level, Inspection Practices, Source of Quality, Equipment Investment, and Production Focus. The Change of Employee Roles category had questions regarding Employee Empowerment and Pay Incentives. DATA ANALYSIS Formation and Test of Reliability and Unidimensionality of TQM Diffusion Score. As a formative indicator of TQM diffusion, the diffusion level of TQM practices was measured by summation scores of seven dependent variables. Reliability of this measure was sufficient with a Cronbach coefficient alpha of.94. Unidimensionality is a second consideration for the appropriateness of a summation measure. [Malhotra, 1993] To check unidimensionality of the summation score measure, factor analysis was used. Factor analysis determines the number and nature of the constructs that underlie a set of variables. It attempts to provide a more parsimonious explanation of the constructs underlying a set of measures than is provided by keeping the measures intact.

5 The ten variables were: Measurement Tools, Repair/Rework, Production Standards, Quality Level, Inspection Practices, Source of Quality, Equipment Investment, Production Focus, Employee Empowerment, and Pay Incentives. The ten practices were placed on a 5-point Likert scale with polar pairs of words to indicate the level of diffusion. Seven out of the ten factors loaded strongly on a single factor, with no loading less than.50. The three out of the original ten variables that were excluded were equipment investment, pay incentives, and production standards. Test of Hypotheses. One-way analyses of variance (ANOVA) were used to examine the association between the environment and characteristics of the organization and the diffusion level of TQM [Figure 1] Least squares means (LSMs) were used to test the direction of the relationships among the subgroups under the five hypotheses. Level of significance was set at.05. RESULTS Profile of Respondent Companies. The adjusted response rate was 33% (n = 143) after the exclusion of 93 unavailable companies. Companies were considered unavailable if contact with the company could not be established through mail, phone call, and inquiry to directory assistance. After this search, the company was assumed to be out of business and 430 companies comprised the final sample. Companies with 25 or more employees were included in the study because organizational development research states that this size of company usually has formalized operation strategies. [Bolden et. al., 1997; Matta et. al., 1996; Porter, 1979; Rogers, 1995] The unavailable and nonrespondent companies were similar in profile to the original sample. The most common firm sizes were employees (54%), and 351 employees and over (30%). Medium sized firms comprised 16% of the sample. [Table 1] Table 1. Respondents by Firm Size and Product Category Firm Size (Number of Employees) Product Category and over Total % Women s Men s Children s Home Textiles Unisex Component Other Total % The product category of home textiles comprised the largest group of manufacturers (24%). Men s wear manufacturers were the second largest group followed by women s wear and unisex apparel, respectively. Manufacturers in the Other group (8%) were comprised of specialized manufacturers such as: work apparel, military apparel, health care textile products, and automotive. Component manufacturers (7%) were involved in the fabrication of accessories, such as belts or component apparel parts, such as collars and cuffs. For fashion change, all four levels were represented with the combination category of fashion and

6 basic products representing the largest category (54%). This combination of both fashion and basic changes may be attributable to product mix within the two largest manufacturers, home textiles and men s wear. Product innovation was distributed among fairly stable products (35%), focused and stable products (28%), and innovative products (26%). DIFFUSION OF TQM The diffusion of TQM varied by sewn product manufacturers. The most frequently used TQM components were production focus, which is building quality into the product (47%) and employee empowerment, which is the operators accepting ownership for product quality (39%). The least used TQM components were quality level, which is achieving zero defects (12%) and repair/rework, which is eliminating repair and rework (8%). Sewn product manufacturers are giving responsibility and ownership of quality to their operators. However, as a group they have not yet achieved zero defects or substantially reduced or eliminated defects. This finding relates to Ebrahimpour s [1988] case studies, that found traditional manufacturing organizations had top management that was initially establishing a TQM program, but then failed to lead the diffusion of TQM. Ebrahimpour (1988) found that top management lacked a consistency of purpose for completing the TQM diffusion. TQM diffusion scores ranged from 12 to 35, with the maximum score being 35 (7 factors multiplied by a maximum of 5). The seven components of the TQM diffusion score were measurement tools, repair/rework, quality level, inspection practices, source of quality, production focus, and employee empowerment. All survey respondents had adopted TQM and were attempting to diffuse TQM within their organizations, because all respondents had a score on TQM diffusion scale. The mean score of TQM diffusion was 25.4 and the sample mode was 26. TEST OF HYPOTHESES This study examined the TQM diffusion patterns in XX (state) sewn product manufacturing and how TQM practices related to environmental and organizational characteristics. Quality focus of suppliers. Quality focus of suppliers is related to the diffusion level of TQM. The quality focus of suppliers proved important in a question that inquired How important is the quality focus of suppliers to your company s quality focus. Responses were significantly related to the diffusion level of TQM (F[5,126]=2.68, p=.0001). An extremely important or a very important response to this question yielded a TQM diffusion level that was 4.99 points higher than organizations that responded lower level of importance from suppliers quality focus. A suppliers quality focus is related to the diffusion level of TQM at the next link in the value chain. This finding supports the concept of a value relationship rather than the traditional price relationship with suppliers. [Butz, 1995; Kuczmarski, 1991] Quality focus of customers. The quality focus of customers proved important in a question that inquired How important is the quality focus of customers to your company s quality focus. Responses were significantly related to the diffusion level of TQM (F[3,126]=1.74, p=.0001). An extremely important or a very important response to this question yielded a TQM diffusion level that was 5.65 points higher than organizations that responded that customers quality focus was important to the sewn product manufacturer. This finding that the quality focus of customers is related to the diffusion level of TQM is at the theoretical foundation of the quality philosophy.

7 [Butz, 1995; Deming, 1986; Juran, 1988; Nadkarni, 1995] Type of product produced. The sewn product industry is very unique in its variety of products both among manufacturers and within a particular manufacturer. [Schottmiller, 1997] The type of product manufactured (specifically, product category, fashion position and product innovation) had no statistically significant effect on TQM diffusion score. Ko and Kincade [1998] found product innovation category to demographically distinguish sewn product manufacturers in relation to Quick Response, but their findings did not find significance with product categories. The diffusion level of TQM was not significantly different across the seven product categories (F[6,126]= 0.72, p=.63). The diffusion level of TQM was not significantly different across the four fashion position categories (F[3, 126]= 2.27, p=.13). The diffusion level of TQM was not significantly different across the four product innovation categories (F[3,125]= 2.95, p=.08). Trade literature [Schottmiller, 1997] gives indication that product categories distinguish the sewn products industry and this finding needs further study. Training of employees. The training of employees was significantly related to the diffusion level of TQM categories (F[1, 125]=3.12, p=.05). As indicated by TQM Diffusion Model (Figure 1), TQM training is identified as a key consideration for firms when adopting TQM. For TQM training importance, data were examined by the LSM technique to determine significant differences among groups. Organizations that did TQM train their employees had the higher mean score for the diffusion level of TQM (m=28.0), whereas firms that did not TQM train had lower scores (m=25.23). In this study, manufacturers who TQM trained their employees implemented TQM most frequently. This finding is important when companies are assessing educational and training programs and relating the importance of tying training to strategic missions. [Powell, 1995] Organizations who invest in TQM training of employees to implement TQM should see a positive effect on TQM diffusion throughout the organization. Management attitudes. The opinion that TQM is not a fad was significantly related to the diffusion level of TQM (F[1, 117]=3.96, p=.049); therefore, as indicated by TQM diffusion model, organizations that had managers who had the opinion that TQM was not a fad had a TQM diffusion score 2 points higher than organizations whose managers that believed TQM was a fad. Management attitudes proved important in a second question that inquired Do most leaders in the industry practice what they preach regarding TQM. Responses to this question were significantly related to the diffusion level of TQM (F[1,107]=4.52, p=.035). Positive response to this question yielded a TQM diffusion level that was 2.5 points higher than organizations that responded negatively. Management attitudes about TQM in the industry are related to the diffusion level of TQM. This finding relates to Nadkarni s (1995) research that found Malcolm Baldridge Award Winners had strong and committed management that believed in quality and relates to the quality premises of Deming [1986] and Juran. [1988] CONCLUSIONS AND IMPLICATIONS All of the sewn products companies surveyed have adopted TQM and were at some level of diffusing throughout their organizational culture. This research empirically defined an operational definition of TQM diffusion within the sewn products industry. The TQM diffusion score included three types of TQM activities: (1) Measurement of quality; (2) Company quality philosophy; and (3) Change of employee roles. [Figure 1] Ten questions in the three areas of measurement, company

8 philosophy, and employee roles were the inputs for the TQM diffusion score and seven variables were selected after factor analysis with varimax rotation. The three variables that were excluded were equipment investment, pay incentives and production standards and were considered nondistinguishing factors for the sewn product industry. The hypothesis testing confirmed the TQM Diffusion Model [Figure 1] by finding significantly different levels of TQM diffusion with environmental characteristics of supplier and customer. Hypothesis testing also found significance of TQM diffusion and organizational characteristics, such as management opinions of TQM within the industry. The knowledge of TQM diffusion that comes from this research augments business trade and research articles about TQM successes and failures. [Feinburg, 1996; Nadkarni, 1995; Weaver, 1995] Extension of knowledge was achieved by examining TQM diffusion in sewn products manufacturing. [Karnes & Kanet, 1994]. As sewn product manufacturers face competition and threats, specific organizations can use research findings to help make strategic decisions, such as an initial decision to adopt TQM. Considerations of the environment, characteristics of the organization and the TQM strategy itself, need to all be considered before adopting TQM. Findings allow sewn product manufacturers, who have already adopted TQM, to benchmark TQM diffusion with other firms in the industry. Specific TQM components for the sewn product industry are identified in this research and can serve as another point of comparison. Linking the concepts of organizational development and educational theory is the primary research contribution of this paper. Successful TQM diffusion has been empirically linked to the strategic decision factors of the environment, the organization and the strategy itself. This research can be expanded to a decision framework to assist organizations in making the decision to adopt TQM. REFERENCES 1. Almaraz, J. (1998). Quality management and the process of change. The International Quality Management Journal Berzinn, H.G. (1994). Learning, motivation and total quality: the potential of correspondence training. Journal of Management Development. 12(7), Bolden, R., Waterson, P., Warr, P., Clegg, C., & Wall, T. (1997). A new taxonomy of modern manufacturing practices. International Journal of Operations and Production Management. 17(11), Butz, H.E. (1995, May). Strategic planning: The missing link in TQM. Quality Progress Crosby, P.B. (1984). Quality without tears. New York: New American Library. 6. Cupello, J.M. (1994, May). A new paradigm for measuring TQM progress. Quality Progress,

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