TQM: what's in it for academics? - total quality management

Business Horizons, Jan-Feb, 1995 by Richard J. Schonberger

Big Business wants to hire university graduates who are literate in total quality management. Six mega-companies--American Express, Ford, IBM, Motorola, Procter & Gamble, and Xerox--said so in an open letter published in 1991 in the Harvard Business Review. Five of these companies and three others joined forces with several universities to charter and fund six TQM working councils charged with bringing total quality to higher education (see the Figure for a definition of total quality emerging from one of the councils, of which I was a member[1]).

It may not be easy. Total quality management is, in some ways, contrary to instruction and research practices in the university. TQM is team-based. Faculty members, however, are notorious independents. So are students: it's dog-eat-dog in the classroom. Also, TQM calls for cross-functional thinking, planning, and doing. Faculties and curricula, however, are highly specialized, and professors avidly protect their turf. We might add that universities are tradition-bound, whereas TQM trumps for continuous change.

Despite these gloomy-sounding assessments, TQM initiatives are appearing here and there in academia. There are a few good reasons why this may continue, though perhaps fitfully. They have to do with opportunities to innovate and explore new instructional and research horizons, which have strong appeal for most academics. Business, economics, engineering, and related tool disciplines (information systems and mathematics/statistics), plus other professional schools, are particularly affected by total quality management.

Business and Economics

Colleges of business and economics include specializations in operations management, marketing, business policy and strategy, management accounting, corporate finance, financial accounting and auditing, human resource management, organizational behavior, and economics. TQM offers differing challenges and attractions for each.

Operations management (OM). TQM affects nearly all of the OM agenda. A primary focus on modeling for efficiency gives way, under TQM, to planning and doing for and with the customer. The customer outlook, in turn, calls for major overhauls in the OM approach to scheduling, equipment selection, facility layout, maintenance, inventory management, and quality assurance. Briefly, schedules, equipment, layout, and inventory management must be geared for quick reaction to customer needs, not just to efficiency and utilization; and process control must replace breakdown maintenance and delayed inspection.

OM professors have a special reason for heeding the call of TQM. They had failed to stay abreast of an important OM movement called materials requirements planning (MRP) that emerged in industry in the 1970s. The MRP juggernaut had become OM's leading edge in the real world of manufacturing, but for a decade OM textbooks and journals said little or nothing about it. To catch up and stay caught up, OM professors, in droves, joined the professional societies, where they could keep an eye on fast-changing developments. And they began publishing heavily in practitioner periodicals, which they fought to elevate to tenure-class status. Then, when TQM and related topics made their appearance, OM faculties were not far behind.

Marketing. In TQM thinking, the customer is the object. Which university specialty has charge of customers? Marketing. TQM concepts load easily into topic outlines in marketing courses and into marketing research hypotheses.

In practice, marketers and salespeople have carried the burden of having to cover up for their organizations' defects, late completions, and other customer service failings. As TQM kicks in with continuous improvements in quality, timeliness, and so on, the burden is lifted somewhat. Each improvement is marketable--in proposals, in advertising, in sales promotions. For example, Ford Motor Company's slogan, now a decade old, is, "Quality Is Job One." Putting a more positive face on their function holds appeal for marketing professors and students as well as practicing marketers.

Business policy and strategy. Such important TQM-oriented topics as benchmarking, quality function deployment, and customer-centered strategic principles need an academic home. These topics seem general enough to find their way into instruction in several disciplines. However, they deal specifically with matters central to the business policy/strategy area: directing internal resources toward enhanced competitiveness and customer retention. To a certain extent, total quality becomes strategy--and perhaps should be taught that way.

Management accounting. TQM does not permit cost, efficiency, and resource use to remain as primary operational measures of performance. Quality--in all of its dimensions--dominates. Because management accountants have been the guardians of performance measurement, the challenge of reinventing performance management is largely theirs. Thus, a decade ago leading management accounting professors, notably Harvard professor Robert Kaplan, began arguing that performance should be measured in nonfinancial terms, including quality, inventory levels, and deliverability.