THE ROLE OF IT IN TOTAL QUALITY MANAGEMENT

UDREA ROXANA MARIA GROUP:136 AFFILIATION: ACADEMY OF ECONOMIC STUDY OF BUCHAREST, ROMANIA

Change for the better

Abstract The aim of this study is to demonstrate, using a theoretical model, how a company should address the concept of Total Quality Management in order to reach business excellence and customer satisfaction. Nowadays, economists confront with a large amount of factors that make the existence of a company in the market much more difficult. In todays competitive marketing environment, organizations try all possible efforts to promote their brand, to attract customers attention and to determine them to effect purchase decisions. As a whole this paper offers a framework of management quality coupled with information technology that together enable a company to increase productivity, in order to attract the customers attention and to encourage the buying behavior. Process change has become the main concern of todays companies, and applying the right strategy in order to achieve change has become more and more important. The following research will highlight how TQM strategy together with information technology have been implemented in the LOreal company, and the achievements that the latter had after adopting such strategy. Keywords: TQM, information technology, competitive environment, customer satisfaction, strategy. Introduction Implementing TQM in a company may be seen like a new solution that companies adopt in order to face this so called quality revolution. Tough it may seem that many companies have not adequately defined what they are trying to do, and give to the concept of continuous improvement a totally different definition or understanding. In order to have a complete understanding of this concept, we concentrated our attention on how an integrated management solution can be seen as one of the key steps of TQM and how to manage with it from a companys point of view, in our case LOreal. Furthermore, the use of technology, has reached nowadays different levels and generated different discussions on different topics. Some questions need different answers, or today is not necessary any more to give a specific response. Questions like how much the internet help product developers, or are there online sources that help the developers stay informed on a regular basis, are the starting point in our discussion.

Although TQM can be found at all levels of the company, this paper will concentrate on how the manufacturing process, was improved in LOreal, thanks to the usage of technology. As a matter of fact, the key word in this research, technology has become more then important in common language at organizational level. This complex process is used as the link between a company and its customers. Moreover, if you dig deeper into the subject the word technology can have lots of meanings. This article proposes the following approaches: connect technology advances with product innovation, product quality in order to understand better the existing customer. The exponential increase in internet technology has become a subject that leads to more and more implication. Lets say that both the technology that goes in the product, and both the technology used to develop the specific product is providing unexpected benefits. The role of quality and customer is crucial to the continuous success of any respectable organization. The following study provides the foundation for successful management planning in Loreal, company that activates in the cosmetics market. We will describe a number of examples of excellence management, these achievements being more than interesting for any analyst, as this multinational company was able to show us that in order to achieve excellence it is important to challenge yourself as a company, to be committed to build strong relationship with the customers and suppliers, to have a good leadership strategy, and the most important from them all, to deliver innovative, highly effective, pleasant and practical products. In the following we will present a case study concerning the situation of quality, in this large cosmetics company. We will demonstrate that its business strategy was based on an adequate quality strategy.

Case study: Effects of the quality strategy on the companys organizational culture and ways in which the change of software have led to the successful implementation of quality strategy for LOreal. A brief history of the company LOreal was born in 1907, when its founder, Eugene Schuler, developed an innovative color formula, that he called Aureline. He decided after this, to manufacture and sell this product to hairdressers in Paris. The story was a success, as after this untempt, the number of clients increased, and he needed to hire more employees.

In 1909, the company was registered under the name of Socit Francaise de Teintures Inoffensives pour Cheveux, the future LOreal, which had as guiding principles research and innovation in the interests of beauty. Its workforce was composed at the beginning of 3 chemists and by 1950, the research teams had 100 members, and the number reached 1,000 by 1984, and is nearly 3,000 today. The Group today markets over 500 brands and more than 2,000 products in all sectors of the beauty business: e.g. hair color, permanents, styling aids, cleaners and fragrances and body cosmetics. These products are found in all distribution channels, from hair salons and perfumeries to hyper and supermarkets, health and beauty outlets and direct mail. Concerning the information that we managed to find about the company our research lead us to the result that this unit, with a strong tradition, with good rennet collective and important manufacturing concepts, has over 50,500 employees on line. Change: Embrace it, dont deny it! The following step analyzed in this paper will be concentrated on LOreals ability to implement small incremental changes in order to create a new technology framework, in order to permit disparate locations in the world to keep in touch, to share information more effectively. We will shortly present the achievements that LOreal had in time, and especially now that had become the company that has as core mission to make people around the world to aspire to beauty. But in order to achieve such a mission, a great sacrifice and study has to be made. As everyone knows this company produces its products using a long manufacturing process that should be defined as one of high quality. This is why, everything needs to be done very carefully, every product has to be made with care and in a secure manner. And for that, this big company has to have the proper technology to support the whole production process. Why is this considered such a challenging mission, the common customer asks himself? A question that some could see it as not of highly importance, but that led the company to make drastic changes as a whole. And in order to understand such a strategy common customer should ask himself if he is the single person in the world that faces with the problem of beauty. In this manner, we will see how Loreal manages to deal with such a large number of customers daily.

Problems facing Still, tough everything went good, they didnt really kept track of everything they manufactured, so they came to the conclusion that it wouldnt be a bad decision to make a change in the manufacture plan, as the old one wasnt satisfactory any more. Also, another problem was ERP (Enterprise Research Planning), that was seen as not being able any more to respond to the goal of global product uniformity . As Loreal is a big company, known worldwide it is compulsory for the products that it provides to have the same ingredients and the same quality. The problem that they were facing was that of managing all the branches from all the countries in the same time, using the same production process. They came at the conclusion that change needed to be implemented and started to think for the better result. The conclusion was reached, and IT problem was brought into discussion. In the major companies, there is a lot of talk about the concept of aligning IT with the business, but LOreal decided that business project management could work in making IT a big part of the business in order to make change happen. This is seen as a very difficult process for such a large company as LOreal, because change sounds as an intimidating process, and when is needed to be implemented by all the branches it can be seen as something not too easy to deal with. To make it short, the manufacturing process was the one that needed the special attention, as it was the most important. So a close approach was to re-engineer this process, in order to work more efficiently, but in the same time to same quality and integrity that LOreal enjoyed for years. They began to assure that all the products from the 42 factories that they managed are created using uniform production, quality and process methodology.
Comunication as a core capability

But LOreal knew that they couldnt implement any of those, without the support and enthusiasm of their employees and stakeholders. It is important to always attract new talented people, and LOreal learned that. This is why only in 2005, they received 500,000job applications, carried out 45,000 interviews and recruited 2,027 managers from 75 different nationalities, being voted the second most desired company to work for. Further results can be seen in Fig.3, that summarizes the workforce at global level.

Fig. 3 LOreal employees chart If you think of the entire process of product development, you will find that at its roots there are thousands of decisions , each of its that require interactive communication to resolve. In addition, this manufacturing process that LOreal came with, required some changes in the employees habits, as this means that they should spread knowledge- sharing across geographical and cultural boundaries. The purpose was to implement those changes that the employees would accept and in the same time follow. Additionally, for each business process a business owner was supposed to monitories this entire work, as his job consisted to diagnose each site process and help implement the change. After he has been finished with this part, the job will be managed by the Information System team, that will create the system design and implement the conclusion that was reached. So the conclusion was reached and it sounded like that: combining SAP(System Analysis Program development) with the FlexNet platform will give the comprehensive solution to address the challenge of adaptive manufacturing, as it gives the chance to implement and continuously improve manufacturing process quickly, in a smooth and efficient way across global companies and in the same time reducing IT costs and improving efficiency.
ISIS is born

The system for process information was given the name ISIS (Integrated Solution for Industrial Systems). This contained the following : transactional processes, financial controls and purchasing that were integrated into the manufacturing operation system managed by FlexNet. All in all, ISIS together with FlexNet are making everything more easier for LOreal. This means that they support all factory processes, that are production, quality, and purchases. So this kind of centralization allows this global company to experiment with new process changes and to quickly implement them globally to perform the IT updates in quick time, as it is very difficult to manage so many regions of countries.

As a matter of fact, using ISIS, Loreal had the flexibility to tailor the processes to local needs, as each region usually concentrates its attention on a different process. And this gave new ideas to the company as a whole, making improvements that can be implemented globally. The main idea is that each manufacturing site deals with different kinds of LOreal receipts for the cosmetics products. As in each company, quality is one of the main factors, LOreals attention is focusing on product quality daily. This is why every ingredient is tested for quality, and each employee is obliged to follow the exact recipe. But sometimes, complexity leads to hesitation and unsecure attitude, process that can lead to quality threatens, that leads to increasing waste. ISIS is there to guide the operators trough the recipe, and in this manner automatically records the weight of the ingredients to ensure the right quantities. Furthermore, the labeling process is also an important one that ISIS improved considerably. After ingredients are weighted, they are labeled in order for the worker to add them to the recipe. Also, labels provide the information about the quality tested ingredient, and reduce the workers stress and confusion. The company wants to be sure that in each part of the world there is the same quality for the same product. For example, a shampoo bought in France, will have the exactly same quality as one bought in Romania. And the most important idea is that the same model is being used everywhere as its the same system and one development machine. The conclusion: all the informations within the organization go on one unique server. The process is well defined and it comprises most of the problems that need to be solved across the entire company. Figure 2 shows a layout of the presented findings.

Fig.2 Changes brought by ISIS

As a matter of fact the ISIS philosophy is: Think locally, act globally, keeps embracing diversity across the business. Using ISIS togheter with FlexNet has improved the capacity, the stress at the workplace disappeared, waste decreased, and the inventories are lower. In this way Loreal managed to achieve global manufacturing operational excellence, as it attained the high production and quality standards, manufacturing 4.9 billion units within 23 global brands across 38 production sites.

Conclusion The examples above only scratch the surface of what can be done if companies use research and information technology in improving the strategy and the products quality. Loreal learned this and saw that specific stages should be followed in order to be succesfull on the market. It teaches its people to to answer the specific questions in this way preventing money and time for being wasted. Using ISIS they progress quickly with small but sound steps, as they know now that success depends on the ability to shorten the iterative product development loop. Sometimes criticized, disputed or diverted, Loreal still managed to be known as the number one in the cosmetics world. It has an incredible turnover, year after year, and after making these research I came at the conclusion that is the philosophy that makes this company so successful and also that makes their operations management implementation such a great success. Everyday this company tries to make their consumer, but also their employees to apply this principle. As Jaques Playe, Loreal CIO for Operations said If you sell well- being, you need to be part of the well-being of the planet. Thus, reaching the final point of our research paper, we shall end by saying how with TQM a company can identify , implement and celebrate change. And this is how Loreal managed it: it needed to change for the better in order to reach early successes that feed further ones.

Reference List
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