INTEGRATION OF TOTAL QUALITY MANAGEMENT AND SUPPLY CHAIN MANAGEMENT TO ACHIEVE CUSTOMER SATISFACTION.

RECOMMENDING A CONCEPTUAL MODEL

Saqib Latif, Ishfaq Ahmed Cheema, Karamatullah, and Shahzad Malik Army Public College of Management Sciences, Ordnance Road, Rawalpindi Cantonment, Pakistan. ABSTRACT The main aim of this paper was to develop and propose a Total Quality Management model (Hummayoun et al., 2008), for integrating total quality management and supply chain management to achieve customer satisfaction. After an extensive literature survey, the researcher developed the said model based on the assumption that if TQM tenets (Hummayoun et al., 2008), i.e. total involvement, customer orientation, systematic support, continuous improvement and measurement (Bodie, 2008), would result in higher level of customer satisfaction, if they are implemented by the organizations. Five dimensions of SERVQUAL model (Zeithaml et al., 1996) were used by researcher namely tangibles, reliability, responsiveness, empathy and assurance to measure service quality. The developed model is applied in nature and may be used by any (Hummayoun et al., 2008), supply chain organization to empirically examine the level of TQM implementation. Further empirical verification is possible by taking the model as an independent variable and any other variable like (Hummayoun et al., 2008), Just-in time logistics or Supply chain operations reference model as a dependent variable.

INTRODUCTION Companies world-wide recognize the importance of meeting customers needs to succeed in the competitive market-place. They realize that optimizing operations within the four walls of their enterprises is not enough to achieve business excellence. They understand that the involvement of suppliers, which is critical to improve quality and meet customer specifications, can enhance their performance. Hence, supply chain management (SCM) is advocated as a means to help companies leverage their suppliers resources in improving their own competitive edges (Cavinato, 1991; Ellram& Cooper, 1990; Houlihan, 1985; Jones & Riley, 1985; Towillet al., 1992). The global market is full of newest technologies due to these quality managers and supply chain mangers are faced with new challenges and the old techniques of quality management and supply chain management has become somewhat redundant. In totality adoption of TQM will improve the internal functions and once these are in the grip then external functions with mergence of Quality Function Deployment, will certainly improve the overall picture of firm. Total Quality Management (TQM), a modern concept and a phrase that is most commonly used by strategists, is based on the assumption that quality is manageable. This fashionable approach focuses on customer satisfaction, accurate measurement of all significant factor of business,

continuous improvement their relationship based on mutual trust and teamwork. (Pearce and Robinson, 2005). Due to very high competitive environments supply chain industry also has to apply cutting edge tools so to keep its self abreast within the race, the success of supply chain industry depends upon the involvement of higher executives, customer focus including internal and external customers, right decision making, Quality Deployment Function, Culture, and mutual trust. The philosophy of TQM diverts business towards a particular direction, i.e. satisfaction of both internal and external customers and they are the best sales people around (Hummayoun et al., 2008), with special emphasis on QFD with the later. Keeping in view the fast moving dynamics of supply chain industry there is a need to develop a model so that TQM and SCM is incorporated into seamless fusion to achieve customer satisfaction. At present a wide variety of body of knowledge is available, but there is need to develop a workable and comprehensive model which covers the TQM principles related to the customer satisfaction in supply chain industry.

Statement of the Problem Supply chain Industry around the world is growing with a rapid pace (including Pakistan) and emphasis are laid down on the quality service. Huge amount is spent upon the quality management so that end customer feels satisfied. There are models available but they don't address the issue at hand in a comprehensive way. In order to cover the gap, a TQM model which can be implemented by any firm to run its operations. There is an intention of researcher to test the model in supply chain industry. Objective of Research To develop a comprehensive TQM model for Supply Chain Industry. METHODOLOGY Developing of a comprehensive TQM Model Relevant literature was reviewed by the researcher, i.e. quality management in supply chain sector and developing a TQM model covering the related fields. A model was developed after an extensive review of literature based on following: a. b. TQM principles (Nagware et al., 2006) Supply chain implementation aspects, Leadership Involvement, Training, Customer Focus

Including Internal and External Customers, Quality Decisions, Quality Deployment Function, Improvement through Feedback, Culture, and Employee Empowerment. c. Attributes of service quality presented by Zeithaml and Bitner (1996)

The quality perspectives available in the body of knowledge are either about internal or external customers. The researcher has combined the both with TQM principles pertaining (Hummayoun et al., 2008), to the implementation aspects in supply chain industry.

LITERATURE REVIEW The researcher has taken into account the previous studies conducted and has tried to establish a path way to forward the frontier of knowledge. An effort has been made to identify the gap in knowledge yet to be filled. In the following section, an effort has been made to identify the gap in knowledge through review of the existing literature on the dimension of the issues raised in the previous discussion(Hummayoun et al., 2008). Author Zeithaml and others Year 1985 Findings and Conclusion The SERVQUAL model developed by Valarie A. Zeithaml, A. Parasuraman and Leonard L. Berry is a result of their qualitative study. Following are the dimensions of the model: tangibles, reliability, assurance, empathy, and responsiveness. The dimensions have further elaborations. The model is capable of identifying the gap between service quality perception and customer expectations, and widely used to assess the level of perceived service quality in an organization (Wikipedia, 2007). Kanji Frick 1996 1997 Kanjis model consists of four principles: delight the customer; management by fact; people-based management; and continuous improvement. The study concluded that an organization culture based on employee involvement, effective use of technology, top management commitment facilitates the implementation of TQM. Pong et al. 2001 While using the well established 5 point scale of Taylor and baker of customer satisfaction, they concluded that perceived quality has a positive impact on customer satisfaction. Gonzalez 2007 QFD can be very helpful in answering the question how to deliver quality products and services based on the needs of customers, or the voices of customers? (Hwarng and Teo, 2001). The two fundamental purposes of QFD are: to improve the communication of customer expectations throughout the organization; and to improve the completeness of specifications and to make them traceable directly to customer expectations and needs (Gonzalez, 2001).

An understanding was developed by the researcher through above given review: Successful TQM program is associated with strong leadership. The customer and employees are the key players in the quality model. Training plays an important role in enhancing the vision of an employee. Quality decisions based on measurement. QDF implementation to improve the organization orientation customer focused. Culture to work in harmony with each other, emphasizing on team spirit. Employee power to implement right decisions to reduce wastage.

TQM MODEL FOR SUPPLY CHAIN INDUSTRY Prime purpose of the paper was to propose and develop a TQM model for the Supply Chain Industry, so that can be applied universally. The model which was developed for the research is tiny contribution towards the body of knowledge and has numerous applied aspects. Basically the model developed is about the implementation of quality issues relevant to customer and the customer satisfaction, these are general in nature. The proposed model establishes link between the TQM tenets (Nagware et al., 2006)and implementation aspects by supply chain firms coupled with SERVQUAL model (Zeithamal et al., 1990) to achieve customer satisfaction.

Figure 1 (Ngware and Moses, 2006; Naeem and Saif, 2008; Zeithamal et al., 1990)

The four tenets of TQM are the foundation for the development of the paper namely leadership, human resource development, employee empowerment and quality planning. If the implementation aspects as proposed (leadership, training, customer focus, quality decision making, quality function deployment, continuous improvement and employee empowerment) are followed strictly would result in quality service (SURVQUAL application). Customer satisfaction is achieved through the quality services provided and the customers are internal and external, the internal customers are employees that are to be satisfied through their proper recognition in the firm, the more satisfied the internal customers are, will eventually lead to the flourishing of business and bigger market share. The constructed model encompasses all components which can enhance the overall operations of the supply chain sector. Basically the construct of model is on following: 1. TQM tenets (Nagware et al., 2006) 2. Service quality model i.e. SERVQUAL Model (Zeithaml and Bitner, 1996)

Detailed description of the TQM model developed for the supply chain industry is as follows: 1. Tenets of TQM written by Nagware and Moses W on Total Quality Management in secondary schools in Kenya are comprehensibly explained for quality and services. 2. The implementation aspects as indicated in the model which are to be practiced by any firm in the supply chain industry keeping view the Tenets of TQM, the total concept of Supply Chain is a sequence of events intended to satisfy a customer (Donald, 2003), keeping the preceding statement in view now we will see that how these implementation aspects are to be taken into account for customer satisfaction. a. Leadership Involvement. Leadership involvement is the major success in the quality

improvement processes. Dynamic leadership will remain totally involved in improving the customer satisfaction and will recognize the high performers and will be rewarded for their outstanding performances. b. Training. To provide time, opportunity and resources for the proper training of

employees to keep them abreast with latest methods and concepts of quality. Trained employees are an asset for a firm.
c.

Customer Focus.

Needs of a customer must be satisfied as per TQM. A proper

customer orientation will lead to customer satisfaction. In supply chain industry the time and method of delivery will improve the service quality. There are two types of
customers, external and internal. External customers are those individuals who purchase the product or service of the business. It is the external customer who provides the purpose for the business to continue operating (Bodie, 2008). For example, in supply chain we identify a complainant for late delivery of merchandise as one of our external customers.

Our second customer (the internal customer) is a very important segment of the business and business depends upon him. According to TQM, the organizations emphasis should be on meeting the needs of the internal customer. Once a high a quality of service is provided to our internal customers, they in turn provide support to the need of our external customers. More satisfied the internal customer better will the service. d. Quality Decision Making. Measurements should be the basis for quality decision

making. The most critical path in TQM is the part of measurement. Individual employees productivity should not be made base for measurement; instead it should be aimed at increasing the efficiency of an organization efficiency of procedures and systems. Inefficient standing operating procedures are recognized as the biggest obstacle in the way of increasing the efficiency. TQM helps to set the goals in an organization. Committed employees always tend to achieve the committed goals and in turn as a whole the organization goals are achieved. e. Quality Function Deployment. QFD can be very helpful in answering the question

how to deliver quality products and services based on the needs of customers, or the voices of customers? (Hwarng and Teo, 2001). The two fundamental purposes of QFD are: to improve the communication of customer expectations throughout the organization; and to improve the completeness of specifications and to make them traceable directly to customer expectations and needs (Gonzalez, 2001). f. Continuous Improvement. By merely implementing the latest management techniques or employing the state of the art technologies for better service and quality is not an answer to the continuous improvement. Continuous improvement is achieved through doing hundred of small things in an organization and they are not given by the consultants or experts of the field. They come from the suggestion from the employees and these are implemented by the management. g. Culture. The basic aim of this aspect is to develop an environment in which everyone

works in hand and glove to make the best quality and service for the customer. h. Employee Empowerment. It is embedded in an organization to have a pro-active stance of the employees to correct the wrongs on the spot without looking over their shoulders for the orders from above, this gives a meaningful involvement to employees and they ensure to give the quality and excellent service to the organization.

3. Valarie A. Zeithaml, A. Parasuraman and Leonard L. Berry developed a SERVQUAL model after their qualitative study. The cardinals of the model are: tangibles, reliability, assurance, empathy and responsiveness. Gaps between service quality perception and customer expectations can be identified through this model. The implementation aspects by supply chain organizations in relation with TQM model and SERVQUAL model gives out the customer satisfaction. The components of SERVQUAL model are: a. Tangibles. Operations-logistics channels, customer demand, and delivery time. b. Reliability. Error free processing, assurance of keeping the service quality, and keeping of promises. c. Responsiveness. Meeting the customer demand out of the way, prompt action on

customer demands and attention to the details given by the customer. d. Empathy. Basically it the way of handling a customer in way that he feels very homely

and his everything taken care off. e. Assurance. These come with comfort, confidence, courtesy and security. Potential for Future Research and Empirical Verification of the Model The implementation aspects to satisfy customer can be empirically tested and the model has the potential for future research. CONCLUSION We are living in a globally competitive environments and everything in business depends upon the high quality products and quality service. The supply chain industry in Pakistan is an infancy stage and this sector is not in a state where it can compete at global level. But whatever we have at our hands needs to be built on TQM principles so the foundation is kept strong from the start and once it grows in size, it grows in stable shape. The guidelines are there in the developed model for implementation in the supply chain industry. A set of hypothesis can test the TQM implementation empirically. There is need to change the attitude in the industry and quality and good service should be the key foundation for customer service. REFERENCES CAVINATO, J.L. (1991) Identifying inter firm total cost advantages for supply chain competitiveness, International Journal of Physical Distribution and Logistics Management, 27, pp. 10 15.

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