Introduction
Optimizing operational processes is a natural practice utilized in businesses of various profiles. Improving operating modes, updating the technical base, expanding the range of products, and other approaches are implemented as part of such optimization programs. One of the techniques used to change both individual aspects of the workflow and overall performance is total quality management (TQM). This concept implies directing efforts to improve the quality of work performed in specific areas of the business, which is designed to enhance productivity and address related objectives, for instance, satisfying employees’ interests. The application of TQM will be considered on the example of the Toyota Motor Corporation, or Toyota. This respected automobile concern is known globally and has a long history of development, having achieved success in many respects through the implementation of appropriate optimization solutions. While taking into account high competition in the target market and the need to control the supply chain globally, TQM is a relevant concept to Toyota as a technique that can reduce costs and increase corporate profits.
Company Description
Due to the continuous optimization efforts of the founders of Toyota, the concern has been flourishing for more than a dozen years. The history of the company began in 1933, and since then, the corporation has been actively working to conquer the global market and develop new car concepts (“History of Toyota,” n.d.). As consumer interest grew, the product line expanded, and even the associated constraints, such as global crises and wars, did not become obstacles to the corporation’s growth (“History of Toyota,” n.d.). The Japanese company was one of the first to adopt the strategy of total quality control in 1961, which can be considered the prototype of modern TQM models (“History of Toyota,” n.d.). As time went on, new concepts evolved, and it became more difficult for Toyota to compete in the global market. However, the company has always made continuous development a top priority, as evidenced by the work on in-demand electric cars, hybrid vehicles, and other products that serve the interests of the target audience (“History of Toyota,” n.d.). As a result, the TQM concept is at the root of the Toyota Motor Corporation’s success.
Reasons for Utilizing TQM in Toyota
Following the TQM strategy reflects a commitment to improving business performance. Blocher et al. (2019) define this concept as part of a continuous improvement regime in which, along with benchmarking, companies look for ways to get the most out of available resources. As applied to Toyota, this strategy is relevant as a practice that can help the corporation meet modern production standards specific to its target market. Toma and Naruo (2017) mention ISO 9000, which is a specific guideline dictating the principles of management activities, and to meet its provisions, the company needs to establish a smooth production regime. The specifics of Toyota’s work involve constant monitoring of the market to identify convenient and profitable routes for the sale of its products. According to Lilja et al. (2017), in relation to the company, TQM is a program for identifying optimal management approaches from routine procedures, which is difficult to implement in a static business environment. Thus, for the Toyota Motor Corporation, TQM is not only a desirable practice but a must-have strategy to promote and maintain performance and success among customers.
Another significant reason that determines the need for the implementation of TQM in the corporation in question is the wide coverage of different business areas, which makes it possible to strengthen control and minimize operational errors. Dahlgaard-Park et al. (2018) highlight this concept as a comprehensive practice and mention marketing initiatives that are more effective when introduced through quality management programs, which, in turn, directly affect profits. The authors also point to the active involvement of the TQM technology in Toyota after World War II and note the success of these tactics that allowed the corporation to recover from the crisis and continue to increase capital (Dahlgaard-Park et al., 2018). Due to a large number of employees working in the organization, TQM is a relevant approach to motivating the staff. Blocher et al. (2019) consider the concept as a mechanism based on the continuous efforts of each worker. As a result, stimulating the personnel to demonstrate high operational outcomes through such a practice allows Toyota to expand its market opportunities and meet the interests of target customers successfully.
When improvements are introduced within one organizational unit, the risk of private optimization arises. To avoid such an outcome, Toyota began to create project teams in which many organizational units participated, including also business partners (Kumar et al., 2018). The goals of this initiative were cost reduction, system configuration, product development, quality improvement, and other optimization objectives. In this way, private optimization could be avoided, and improvements quickly implemented throughout the company, thereby consistently increasing customer satisfaction. This cross-collaboration system continues to expand, reflecting Toyota’s high level of expertise (Kumar et al., 2018). Its managers can afford to focus on individual aspects by assigning responsibilities. As a result, control costs are reduced, which is an additional factor confirming the relationship between TQM and the strategic allocation of financial resources. Therefore, while taking into account the aforementioned reasons, one can grasp why the concept in question is an adequate and necessary practice in the Toyota Motor Corporation.
Measuring the Quality of Optimization
In addition to applying the TQM concept, a significant aspect is to follow an appropriate assessment base that allows for measuring whether the optimization tools are adequate and whether there is a need to transform specific operations. In their research, Chege and Bett (2019) review the activities of the Toyota Company and note that representatives of the corporation “set up quality confirmation frameworks crosswise over different divisions and offices” (p. 17). This means that the company utilizes the necessary metrics to identify improvements in performance and promotes appropriate improvement steps based on these data. To the traditional tools for measuring the effectiveness of optimization, the authors attribute “profitability revenues, costs, capital expenditure, total assets and number of employees” (Chege & Bett, 2019, p. 15). However, in the case of Toyota, these parameters may not be enough because the corporation has numerous subsidiaries worldwide, and additional performance aspects are critical to consider, for instance, the share of sales by region and the stability of the supply chains.
While analyzing Toyota’s TQM approaches, one should pay attention to a special management assessment system that belongs to the company and is its own product. Santos Bento and Tontini (2018) mention “Toyota’s 14 management principles,” a specific operating philosophy that enables continuous optimization in a busy manufacturing environment (p. 977). For this purpose, corporate leaders use labor and material resources, which is costly, but ultimately pays off through staff productivity and customer loyalty. As Keller and Alsdorf (2012) argue, the use of improved systems and tools allows for creating a special culture of success, which positively affects employees’ productivity. Therefore, one can state that Toyota has an effective system for evaluating and measuring the effectiveness of changes, which it has been perfecting over the years.
To avoid inadequate measurement, the corresponding framework helps Toyota management to maintain control over performance and ensure that the TQM concept is efficiently implemented. Khalili et al. (2017) draw attention to “Total Productive Maintenance” as a practice that is aimed at revealing the productivity of operating equipment and the quality of productivity improvement efforts (p. 137). Although all the aforementioned initiatives require appropriate preparation, the company has a sufficient resource base to promote TQM sustainably. As a result, the considered concept is relevant to the Toyota Motor Corporation, and measuring the effectiveness of its implementation allows for applying the necessary strategies to improve operations and enhance performance.
Conclusion
The TQM concept is a much-needed and sought-after technique for Toyota to reduce production expenses and supply chain costs and increase profits in the context of the global business that the corporation leads. The company, founded in 1933, was among the first to implement this optimization approach into its production regimen. Throughout its history of development, Toyota has continuously optimized its labor and equipment resources to enhance productivity. Appropriate techniques and frameworks for measuring the quality of improvements help the corporation ensure that the necessary initiatives within the TQM strategy are sustainably introduced.
References
Blocher, E. J., Stout, D. E., Juras, P. E., & Smith, S. (2019). Cost management: A strategic emphasis (8th ed.). McGraw-Hill Education.
Chege, S. W., & Bett, S. (2019). Total quality management practices and performance of organizations in the real estate industry, case of property developers in Nairobi City County, Kenya. International Journal of Current Aspects, 3(IV), 14-31.
Dahlgaard-Park, S. M., Reyes, L., & Chen, C. K. (2018). The evolution and convergence of total quality management and management theories. Total Quality Management & Business Excellence, 29(9-10), 1108-1128.
History of Toyota. (n.d.). Toyota. Web.
Keller, T., & Alsdorf, K. L. (2012). Every good endeavor: Connecting your work to God’s work. Penguin.
Khalili, A., Ismail, M. Y., Karim, A. N. M., & Daud, M. R. C. (2017). Critical success factors for soft TQM and lean manufacturing linkage. Jordan Journal of Mechanical & Industrial Engineering, 9(2), 129-140.
Kumar, P., Maiti, J., & Gunasekaran, A. (2018). Impact of quality management systems on firm performance. International Journal of Quality & Reliability Management, 35(5), 1034-1059. Web.
Lilja, J., Hansen, D., Fredrikson, J., & Richardsson, D. (2017). Is innovation the future of quality management? Searching for signs of quality and innovation management merging. International Journal of Quality and Service Sciences, 9(3/4), 232-240. Web.
Santos Bento, G. D., & Tontini, G. (2018). Developing an instrument to measure lean manufacturing maturity and its relationship with operational performance. Total Quality Management & Business Excellence, 29(9-10), 977-995.
Toma, S. G., & Naruo, S. (2017). Total quality management and business excellence: The best practices at Toyota Motor Corporation. Amfiteatru Economic Journal, 19(45), 566-580.