Quality Management in Logistics

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Question: While there is widespread evidence to support the view that effective quality management practices can lead to improved organisational performance, some would argue that the importance of quality to logistics systems has not been fully realised.

In the last decade the growing importance of quality management has been a widely debated topic. Much empirical evidence links an organisations quality management practices to improved organisational performance therefore greater surplus. Due to increasing global competition, competitive priorities have shifted from simply cost to quality and flexibility (DeMeyer, Miller, Nakone, and Ferdows, 1989), as a result logistics is applied as one of the key business processes in delivering value and quality to the customer and in gaining a competitive edge. Some authors argue that the importance of quality in logistics systems has not been fully realised. it is this papers view to support that contention, and will provide evidence to illustrate how although there are obvious benefits of increasing quality in logistics, lack of managerial support, training, and funding are the critical reasons why many would argue there is a lack of focus on quality in logistics systems. By assessing whether Quality management practices lead to improved organisational performance, analysing the role of quality in logistics, and further providing organisational and empirical evidence, one will come to understand that although many organisations attempt to apply quality practices in logistics, lack of support from upper management, and being relatively new in application are the reasons why some would argue the importance of quality in logistics has not been fully realised.

Some writers have asserted that TQM provides a unique approach to improving organizational effectiveness, one that has a solid conceptual foundation and, at the same time, offers a strategy for improving performance that takes account of how people and organizations actually operate (Wruck and Jensen, 1994). A more sceptical view is that TQM is but one in a long line of programs, in the tradition of job enrichment, management by objectives, that have burst upon the managerial scene rich with promise, only to give way in a few years to yet another new management fashion.

TQM is generally described as a collective, interlinked system of quality management practices that is associated with organizational performance, (Lakhal, Pasin, and Limam, 2006). This philosophy emphasizes effective top management leadership for quality, supplier quality management, process management, employee training and empowerment.There has been widespread evidence linking quality management to improved organisational performance such as lower costs, improved reputation and market share, increased employee motivation and satisfaction, and improved profitability inevitably follow. The key element is the integration of efforts and resources towards the common good of conservation of the interests of the stakeholders. (Brah.S and Lim.H, 2006). It is therefore vital that top management plays a large role in ensuring each department achieves effective quality management, and realise the crucial role played by top management commitment and support, and that the role of management must expand beyond the boundaries of the firm. Powell, 1995 suggested that tacit resources such as organizational commitment, empowerment and business processes drive TQM success. It is here that many Quality organisations go wrong and don’t realize that employees are the core drivers of quality in the value chain and without a supportive environment quality initiatives made by upper management wont be utilized to its full potential, they must get their employees on board with managing quality, as quality is everybody’s responsibility. The importance of TQM is evident from the emergence of many high profile awards, such as, the Malcolm Baldrige quality award in USA, the Deming prize in Japan, the European quality prize and many more quality awards worldwide. These quality awards identify companies utilizing the best quality management practices and they serve to motivate companies to implement TQM in order to attain and achieve world-class standards. (Brah.S and Lim.H 2006) As a result, today both manufacturing and service industries widely practice many of the TQM practices.

There has been a multitude of empirical studies done establishing a positive causal relationship between the quality management practices of the firm and improved organizational performance. The work of (Hendricks and Singhal, 1997) has provided evidence of a relation between the financial performance and the effectiveness of the implementation of TQM. In their study variable factors were taken into consideration