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htm Total quality management and supply chain management: similarities and differenc es Assadej Vanichchinchai and Barbara Igel School of Management, Asian Institute of Technology, Pathumthani, Thailand Abstract Purpose The purpose of this paper is to comprehensively review, contrast and com pare the differences and similarities between total quality management (TQM) and supply chain management (SCM). Design/methodology/approach An extensive overvie w of the core concepts of TQM and SCM are examined from the literature and are t hen compared to explore how the philosophical perspectives, goals, evolution, an d integration of these concepts could be further developed. Findings TQM and SCM have different starting points and primary goals, which can complicate an integ rated implementation. However, they have evolved in similar ways to reach the sa me ultimate goal: customer satisfaction. TQM emphasizes internal (employee) part icipation and SCM focuses on external (business partners) partnerships but there is a need to emphasize both internal and external partnerships to further stren gthen the emphasis on total TQM and the entire supply chain in SCM. Originality/va lue This paper is one of the rst to discuss comparisons between TQM and SCM. Alth ough both are critical to organizational competitiveness, research so far has te nded to focus on either one or the other. A comparative understanding of the phi losophies, goals, evolution, and integration of both approaches therefore could improve opportunities for integrated implementation and further research. Thus, this paper can be used as a basis for future empirical studies. Keywords Quality management, Total quality management, Supply chain management Paper type Litera ture review TQM and SCM: similarities and differences 249 Introduction Total quality management (TQM) and supply chain management (SCM) ha ve both played an increasing role in strengthening organizational competitivenes s (Sila et al., 2006). In the continually changing global market, quality produc ts alone are no longer enough. New challenges now include a focus on supply to d etermine the right time and place for product delivery (Chin et al., 2004; Robin son and Malhotra, 2005). International business competition is no longer limited to organizations but now includes the supply chains (Li et al., 2006; Kuei et a l., 2001). Although both TQM and SCM are critical to organizational performance, they are rarely studied together (Gunasekaran and McGaughey, 2003; Robinson and Malhotra, 2005; Casadesus and Castro, 2005). This paper aims to present a compr ehensive review of, and comparison between TQM and SCM to identify their similar ities and differences. The comparison includes a discussion of the philosophical perspectives, goals, integration, and evolutions of the two approaches. It is n ot always easy to implement either TQM or SCM on its own. Hence, the dif culties a nd risks increase when they are integrated. Understanding the conceptual similar ities and differences of both approaches however, could improve the conditions f or integrated implementation by achieving synergy and avoiding failure. It could also help identify areas for future research opportunities about an integrated TQM and SCM implementation. A comparison of both concepts is summarized in Table I. The TQM Magazine Vol. 21 No. 3, 2009 pp. 249-260 q Emerald Group Publishing Limi ted 1754-2731 DOI 10.1108/17542730910953022

TQM 21,3 Concepts Perspective (example) Original function Evolutional stage TQM Management philosophy and large-scale management system Quality inspection I nspection ! QC ! QA ! TQM (1) Unaware (2) uncommitted (3) initiator (4) improver and (5) achiever (Chin et al., 2002) Customer satisfaction Speci cation-based per formance or quality (Q) Both internal and external integration Internal particip ation (executives and employees) SCM Management philosophy and large-scale management system Logistics Logistics ! SCM ! SSC (Seamless supply chain) (1) Baseline (2) functional integration (3) internal integration and (4) external integration (Stevens, 1989) Customer satis faction Time-based performance or delivery (D) Both internal and external integr ation External partnership (suppliers and customers) 250 Maturity stage (example) Ultimate goal Primary goal Table I. Similarities and differences between TQM and SCM Ultimate integration Primary integration Philosophical perspective TQM has been de ned in many ways (Sun, 2000), particular ly as a management philosophy (Perry and Sohal, 2001; Khan, 2003; Chan et al., 1 999; Terziovski and Samson, 1999) that encourages cost reduction, the creation of high quality goods and services, customer satisfaction, employee empowerment, a nd the measurement of results (Gunasekaran and McGaughey, 2003, p. 361). Similarl y, SCM could also be understood as a management philosophy (Tan et al., 2002; Ch an and Qi, 2003). For instance, Lummus and Vokurka (1999, p. 11) reviewed Ellram and Cooper (1993)s de nition, which states that SCM is an integrating philosophy to manage the total ow of a distribution channel from supplier to ultimate customer . Since management philosophy tends to be intangible and aims to describe an idea l, TQM and SCM could be further developed to include innovative management pract ices, tools, techniques, applications and anything else that would be in line wi th both conceptual approaches. However, the fact that there is still no consensu s on conceptual de nitions for TQM and SCM poses obstacles to practical implementa tion. Therefore, there is a need for a new framework, especially for SCM, since it is particularly dif cult to clearly de ne and therefore, to implement. Goal Ultim ate goal Both TQM and SCM aim to achieve customer satisfaction (Gunasekaran and McGaughey, 2003; Gunasekaran et al., 2001; Mills et al., 2004 in Lamey, 1996). T here are many strategies to accomplish this ultimate goal. Basically, customers require better product quality, faster delivery and cheaper costs, or quality-de livery-cost (QDC). Organizations must meet these requirements to achieve custome r satisfaction.

Primary goal Crosby (1984) de ned quality as defect avoidance (Khanna et al., 2003 ). The British Standards Institute (BSI, 2000) EN ISO 9001: 2000 and Schroder an d McEachern (2002) de ned quality as the degree to which a set of inherent charact eristics ful ls requirements. Conventional quality control (QC) focuses on speci cat ion-based performance or small-q. It emphasizes inspection to prevent delivering d efect products to customers. Accordingly, Sun et al. (2004), Prajogo and Sohal ( 2004) as well as Prajogo and Sohal (2001) agreed that TQM focuses more on qualit y conformance by aiming to deliver error-free products and services. A term that embraces a wider scope for de ning quality is the big Q, which includes additional customer requirements such as product safety, exibility, and prompt delivery. Unl ike TQM, SCM basically satis es customers in terms of delivery or time-based perfo rmance. Ef cient delivery always leads to cost effectiveness in the supply chain. Chin et al. (2004) and Kuei et al. (2001) reviewed Jayaram et al. (2000)s compreh ensive overview of the SCM literature and concluded that the issue of timing rec eives special attention in SCM research. SCM aims to respond to customers as qui ckly as possible, at the right time and place at the lowest cost possible. Samar anayake (2005) also noted that SCM aims to achieve speed-to-market, agility and the exibility to respond quickly to customer requirements at minimum cost. Moreov er, several SCM researchers (Chase et al., 2007; Simchi-Levi et al., 2008; Lummu s and Vokurka, 1999; Lummus et al., 2003) have agreed that SCM emphasizes the ow of materials and information throughout the entire supply chain. This might be b ecause traditional SCM focused on physical distribution (Gilmour, 1999; Croom et al., 2000). Several other methods/tools applied in SCM practice include the fol lowing: the quick response (QR) in the textile industry; ef cient consumer respons e (ECR) in the grocery industry and the just-in-time (JIT) approach in the autom otive industry. Although TQM and SCM share the same ultimate goal, which is cust omer satisfaction, their primary goals are different, as implied by the emphasis on quality and supply. Better quality and a faster delivery always lead to lower costs. Finally, better QDC enhances customer satisfaction and the competitivenes s of the whole supply chain. In some cases, there may be a trade-off if con ict ar ises between quality and delivery performance, and this is when the difference i n primary goals can present potential problems in implementing an integrated TQM and SCM approach. On the other hand, there is synergy in the ultimate goal, sin ce both TQM and SCM aim to achieve customer satisfaction. Therefore, more resear ch needs to be done to further explore the potential areas of con ict and synergy that practitioners need to be aware of in terms of methodology. Origin and evolu tion From quality inspection to TQM Quality management (QM) rst focused only on q uality inspection, and then included QC, quality assurance (QA) and nally TQM. Th e traditional QM approach was reactive and result-oriented, whereas the modern a pproach to QM is broader and now also emphasizes quality at source or process co ntrol, at every stage, to prevent any errors that could cause defects. The latte r is a proactive process-oriented approach (Mehra and Agrawal, 2003). Quality in spection deals with counting, grading and sorting to ensure that customers do no t receive defective products. QC, on the other hand, applies various TQM and SCM: similarities and differences 251

TQM 21,3 252 statistical QC techniques such as control charts and sampling plans to monitor p rocesses (Lau et al., 2004). QA emphasizes process control to conform to custome r requirements (Prajogo and Sohal, 2004). In 1956, Dr Feigenbaum presented a pap er entitled, Total Quality Control (TQC). Later, in 1968, Ishikawa (1990) introduc ed the concept of company wide QC (CWQC) in Japan. Conceptually there is no sign i cant difference between TQC and CWQC (Martinez-Lorente et al., 1998). Later, the term control was replaced by management because quality is not only a control issue , but also a management issue. TQC and CWQC are now used interchangeably with TQ M (Duf n, 1995; Akao, 1991). Many countries have developed this further by develop ing their own TQM frameworks, which are used as the basis for national quality a ward criteria, to promote quality awareness and to improve their business sector s such as the Malcolm Baldrige National Quality Award (MBNQA). Some researchers have de ned different levels of TQM development. For instance, Chin et al. (2002) identi ed ve stages of development: unaware; uncommitted; initiator; improver; and achiever (Lau et al., 2004). Prabhu et al. (2000) classi ed QM according to anothe r set of ve levels: could do better; room for improvement; promising; vulnerable; potential winners; and world class. From logistics to seamless SCM SCM rst appea red in 1982 (Lee and Kincade, 2003). It originated from the way in which Toyota managed relationships with suppliers and customers (Cox, 1999) and then it share d many common practices with Toyotas JIT (Gimenez, 2004). Initially, SCM focused on logistics (Gilmour, 1999). After that, its evolution was still along the line s of physical distribution (Croom et al., 2000; Tan et al., 2002). Thus, several SCM researchers de ned SCM as integrated logistics management (Romano and Vinelli , 2001). Dotson et al. (2003) also stated that SCM refers to logistics managemen t. In some organizations, SCM and logistics are still used interchangeably (Varm a et al., 2006). However, Mills et al. (2004) argued that Johnson and Wood (1996 ) and Cooper et al. (1997) found that the current scope of SCM goes beyond logis tics. It has evolved to cover not only the operational level but also the strate gic level of both internal functions and external business partners. This wider scope encourages synergy and cross-functional collaboration among all partners: customers, suppliers, marketing, purchasing, production, and logistics. Speci c in dustries have also applied SCM methods/tools such as QR, ECR, and JIT to improve ef ciency and the effectiveness of operational supply. At present, the scope of S CM also covers marketing, product development and commercialization, product ret urn and recycling (Lockamy and McCormack, 2004b; Mills et al., 2004). Some SCM r esearchers have attempted to de ne the levels of SCM development in organizations in ways similar to TQM. For example, Lockamy and McCormack (2004a) introduced th e SCM maturity model, which has ve stages: ad hoc; de ned; linked; integrated; and extended. Stevens (1989) introduced the following four levels of SCM maturity: b aseline; functional integration; internal integration; and external integration. The Performance Management Group and Pittiglio, Rabin, Todd and McGrath jointly identi ed these four stages of SCM maturity (Cohen and Roussel, 2004): functional focus; internal integration; external integration; and cross-enterprise collabo ration. It could be observed that the stages within these SCM maturity levels st arted when a stronger relationship developed among the internal functions. There fore, since SCM

starts from a weak coordination among the internal functions, it matures into an ultimate integration among external business partners. Ideally, the entire supp ly chain should be viewed as a single system, or the so-called seamless supply ch ain (SSC), which is de ned as the state of total integration in which all players th ink and act as one (Towill et al., 2002, p. 89). If TQM represents a superior QM, SSC could be a superior form of SCM. However, there is still no consensus on a common de nition of superior SCM. SCM has been described in various terms: supplie r integration; partnerships; supply base management; supplier alliances; supply chain synchronization (Tan et al., 2002); network sourcing; supply pipeline mana gement; value chain management; and value stream management (Croom et al., 2000; Romano and Vinelli, 2001); and as a demand chain (Kotzab and Otto, 2004 in Vahr enkamp, 1999; Blackwell and Blackwell, 1999). The primary goals of QM and SCM ta rget quality and delivery, respectively. If the term QA is used to represent ope rational quality (e.g. ISO 9000, ISO/TS 16949, and HACCP), either supply assuran ce or delivery assurance might be employed to represent operational SCM (e.g. QR , ECR, and JIT). If the term TQM is referred to as the superior QM, total supply management or total delivery management might be used to describe the superior SCM. Supply chain quality management TQM and SCM are still being developed in te rms of scope and applications. TQM in particular, has been broadened in scope to include all best practices. Thus, as a TQM framework, the MBNQA criteria repres ent dimensions of performance excellence. Since TQM was introduced and developed as a concept earlier than SCM, there are more universally accepted TQM framewor ks now than there are for SCM. Widely accepted quality standards such as the ISO 9000 have led to a greater diffusion of QM approaches, while there is still no comparable standard framework for SCM (Casadesus and Castro, 2005; Lambert et al ., 2005; Croom et al., 2000). TQM and SCM have evolved along similar paths, even though they emerged from different starting points. They diverged in terms of t he degree of integration. They both emerged in response to the need to develop t actical strategies for operational functions (inspection and logistics). They th en were broadened in scope to gain synergy by integrating the concerns of all in terrelated parties. These parties included all internal primary and supportive f unctions as well as the external business partners. Then, there was a shift in f ocus from operational concerns towards strategic issues. Consequently, supply ch ain quality management (SCQM) emerged as a new management concept that combined aspects of TQM with SCM (Sila et al., 2006 in Ross, 1998; Robinson and Malhotra, 2005). Ross (1998) de ned SCQM as: [. . .] the participation of all members of a supply channel network in the cont inuous and synchronized improvement of all processes, products, services, and wo rk cultures focused on generating sources of productivity and competitive differ entiation through the active promotion of market winning product(s) and service solutions that provide total customer value and satisfaction (Sila et al., 2006, p. 492). TQM and SCM: similarities and differences 253 When TQM and SCM are integrated, the business processes and the organizational s tructure will become more complex. For example, some focal organizations in the supply chain may need to establish a supplier development department to work wit h suppliers in quality improvement projects. The SCM department may need to incl ude

TQM 21,3 254 QA unit or vice versa. The quality policy of individual supply chain members may need to be aligned for consistency together to ensure a common quality policy o f the entire supply chain. There is a need, therefore, for more research into th e implications of integrating business processes into the organizational structu re. Gunasekaran and McGaughey (2003) have suggested focusing on the following is sues: managements role in TQM in SCM; how information systems and technologies ca n support TQM in SCM; what impact the organizational structure can have on TQM i n SCM; how education and training can support TQM in SCM; and how cultural and b ehavioral issues can in uence the application of TQM in SCM. Since the concept of SCM was introduced so much later, there is an even greater need for further rese arch into how TQM can in uence SCM. For example, internationally recognized SCM st andards or certi cates should be initiated to encourage the development of SCM as a counterpart to the ISO 9000. Integration (participation and partnership) Both TQM and SCM offer unique frameworks to integrate participation and partnership, since they require participation from all internal functions and continuous coll aboration with all external partners (Gimenez, 2004; Sohal and Anderson, 1999 in Dean and Bowen, 1994). However, TQM focuses more on internal participation, whe reas SCM places more emphasis on external partnerships. Internal participation L akhe and Mohanty (1994) referred to Oakland (1989)s suggestion that the word total in TQM refers to every department and every person at every level in an organiza tion. Although TQM requires involvement from customers and suppliers, it places more emphasis on employee participation. The focus is on both internal primary a nd supportive functions in an organizations value chain. In the TQM environment, all employees (including executive management) are treated as internal customers . If the internal customers are not satis ed, external customer satisfaction is di f cult. Therefore, TQM emphasizes employee involvement and ownership (Khan, 2003). Accordingly, the criteria for most TQM frameworks include the human resource co mponent, such as the MBNQA (NIST, 2007) and European quality awards (The Europea n Foundation for Quality Management, 2007). Hoang et al. (2006) also concluded t hat human resource management issues received the highest coverage in TQM framew orks. Yeung and Amstrong (2003) reported that the external focus receives less a ttention and quality improvement efforts only concentrate on internal matters. H owever, customer satisfaction could be achieved more effectively where quality w as built into the whole supply chain (Robinson and Malhotra, 2005). Therefore, t he focus of modern TQM has shifted from the traditional organization-centered se tting to the whole supply chain (Kuei et al., 2001; Robinson and Malhotra, 2005) which looks more like SCQM. External partnership SCM requires internal and exte rnal business process integration across the whole supply chain (Gimenez, 2004; Towill et al., 2002). SCM effectiveness and ef ciency depend signi cantly on the deg ree of integration (Chin et al., 2004; Bagchi and Skjoett-Larsen, 2005). Therefo re, SCM aims to improve not only the performance of the individual organization but also that of the whole supply chain (Li et al., 2006).

This external focus may be due to the fact that the organization itself must wor k with the customer and the supplier within the same SCM framework (Holmberg, 20 00; Golicic et al., 2002 in Mentzer et al., 2001). SCM focuses on primary functi ons as opposed to supportive functions in an organizations value chain. Most of t he literature and SCM frameworks emphasize the relationship with business partne rs and almost ignore the human resource component, such as the SCM frameworks of the global supply chain forum (Lambert et al., 2005; Li et al., 2006; Tan et al ., 2002). Accordingly, Gowen and Tallon (2003) concluded that little research ha s considered human resource management in SCM. Although SCM emphasizes external integration, the actual implementation must begin by integrating internal functi ons and then moving on to external integration among business partners. Moreover , practical SCM focuses on only a few strategic suppliers and customers. This is because most supply chains are too complex to achieve full integration of all b usiness partners (Tan et al., 1998). This difference in emphasis can be a potent ial problem when implementing a synthesis of TQM and SCM, and more research is n eeded to explore these implications. Conclusions There are many similarities and differences between TQM and SCM. Understanding and comparing them could identif y potential areas of future research as well as the development of a management framework that integrates the two concepts. First, both TQM and SCM could be vie wed as management philosophies and from this perspective, there is an unlimited potential for scope and applications. In practical terms however, implementation is made dif cult by the range of unclear de nitions. Therefore, a new well integrat ed framework should be developed to facilitate implementation, especially since there is still no universally accepted SCM framework. The traditional approach t o TQM emphasizes speci cation-based performance while SCM tends to focus on time-b ased performance. However, the ultimate goal of both is customer satisfaction. T here can be synergy as they share the ultimate goal, but con ict can arise from th e different primary goals. There is a need therefore for more research into thes e potential contradictions to explore how they can be reconciled. Although TQM a nd SCM emerged from different starting points, they evolved in similar ways. Bot h originated at the tactical level of operational functions, which are the prima ry activities in an organizations value chain and then widened in scope to cover all interrelated parties at the strategic level in order to gain synergy. When T QM and SCM are integrated, both business processes and the organizational struct ure will become more complex. Therefore, more research needs to be conducted int o the alignment of business processes and organizational structure. Other manage ment issues worth exploring include investigations into the following: managemen ts role in TQM in SCM; information systems and technologies to support TQM in SCM ; the organizational structure and its impact on TQM in SCM; how education and t raining can support TQM in SCM; and both the cultural and behavioral issues that can in uence the application of TQM in SCM. Future research into SCM and its pote ntial contribution to TQM applications include developing universal SCM standard s or certi cates. Although TQM and SCM require both internal and external integrat ion, TQM emphasizes the participation of all in-house employees, whereas SCM foc uses on the external partnerships with business partners. Since these different approaches could cause potential con icts when TQM and SCM are integrated for a si multaneous TQM and SCM: similarities and differences 255

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TQM 21,3 Yeung, V.W.S. and Amstrong, R.W. (2003), A key to TQM bene ts: manager involvement in customer processes, International Journal of Services Technology and Managemen t, Vol. 4 No. 1, pp. 14-29. Further reading Ellram, L.M. (1991), Supply chain man agement: the industrial organization perspective, International Journal of Physic al Distribution & Logistics Management, Vol. 21 No. 1, pp. 13-22. About the auth ors Assadej Vanichchinchai is a PhD student in the School of Management, Asian I nstitute of Technology, Pathumthani, Thailand. Assadej Vanichchinchai is the cor responding author and can be contacted at: st103128@ait.ac.th Barbara Igel is an Associate Professor in the School of Management, Asian Institute of Technology, Pathumthani, Thailand. 260 To purchase reprints of this article please e-mail: reprints@emeraldinsight.com Or visit our web site for further details: www.emeraldinsight.com/reprints