1: The rationale behind implementation of Total Quality Management
McDonald’s is one of the most popular and well known fast food chains which was originally founded in the year 1940 in California, United States. It initially began as a hamburger stand and later emerged as a full blown fast food chain, with franchises around the world. At present McDonald’s has over thirty five thousand stores in at least 119 countries around the world. It also happens to be one of the most beloved fast food brands, providing top quality food and beverages to customers across the globe. The target market for the brand would be people between the ages of fifteen and thirty, providing affordable yet delicious food to customers (“McDonald’s Australia”, 2018). The purpose of this report is to study the concepts of total quality management or TQM with respect to McDonald’s in Australia. Total Quality Management may be defines as an organizational approach to instill and inculcate a working environment in the company where employees would continuously improve their performance and work towards the overall betterment of the company.
Total Quality Management may be defined as a continuous process in business where constant evaluations of the business operations are executed and any flaws or defects within the system are highlighted (Goetsch & Davis, 2014). These flaws and defects are then rectified so as to pave the way for seamless supply chain and operations in the organization. TQM can help in streamlining operations, enhancing the quality of products manufactured, improve customer experience and ensuring maximum employee performance. The process of total quality management at an organization is all encompassing in nature and takes into consideration the various parties that would be responsible for determining the quality of the final product that is delivered to the customer (Gharakhani et al., 2013). It can also be called a structured approach to the overall management and development of an organization.
McDonald’s, which is one of the top moguls in the fast food industry of Australia, has faced a number of issues pertaining to quality in the past. For one, it has often been accused of blatantly ignoring the accepted and compulsory food quality standards in a few countries. As such, implementation of TQM would prove to be extremely beneficial for the company. The main rationale behind implementation of TQM is competitive advantage and improvement of product and service quality. The main purpose of total quality management at an organization is the continuous improvement of the internal practices (Ebrahim & Sadaghi, 2013). TQM takes into account the industry standards and the internal priorities which are incorporated into its strategies (Augusto, Lisboa & Yasin, 2014). It also comprises the attitude, environment and the culture or attitude of the people working at the organization; apart from that, each aspect of company operations including finance, marketing, engineering, design and production would also be taken into account. In other words, TQM is a collective process and is adaptable and infinitely variable. It would address the various key problems in a business which include redundancy in processes, unnecessary tasks, duplicate efforts, human errors and so on (Androniceanu, 2017). Post the implementation of TQM, a company would notice the following changes:
- Cost reductions– If the principles of TQM are applied to an organization for a prolonged period of time, it can prove to be immensely cost effective and reduce the overall costs involved in running an organization. The reductions in cost would include elimination of repetitive work and waste or rejected products, repairs or reworks, customer support costs, process efficiency increasing the profit per product, fiscal discipline which enhances the overall functioning of the operations and increase in production. These cost reductions would flow straight to the bottom line profits and would not invite any additional costs. This would result in an increase in the overall profitability of the organization (Mohammad Mosadeghrad, 2014).
- Customer satisfaction– One of the most important benefits of implementation of TQM is customer satisfaction. Since the overall productivity of an organization would increase, along with the quality of service delivered, customers are twice as likely to be satisfied with the service delivery (Al-Dhaafri, Yusoff & Al-Swidi, 2013). For instance, at McDonald’s, the implementation of TQM would improve the quality of food items and service delivered at the store outlets. This is bound to increase customer satisfaction rates as well. There are predominantly three aspects which determine the level of customer satisfaction – product, innovation, service and experience (Akgün et al., 2013). The tools under TQM would quantify the problems and would attempt to achieve the best possible results. For instance, it would reduce waiting time of customers, improve client handling techniques, modify the delivery processes to suit the needs of the customer and provide better quality products.
- Organizational development– It is expected that TQM processes would improve the overall working environment of the organization through training programs and quality checks. Each employee of the organization would be educated on the importance of quality and quality control and how it should be the priority of everyone, not just the management (Fu et al., 2015). A proactive working environment would also boost the morale of the employees and motivate them to work harder (Al Swidi & Mahmood, 2013). This would also reduce the chances of errors and mistakes which slow down the process. TQM also encourages the formation of cross departmental teams and facilitates an environment of knowledge sharing between various individuals of the teams. It would also pave the way for effective knowledge management, cost competitiveness, flexibility in personnel management and open lines of communication.
- Competitive advantage– This is another major benefit of the TQM approach in an organization. For instance, at present, McDonald’s faces severe issues with respect to competition in the global fast food market. In Australia, there are a number of brands which pose a serious threat to McDonald’s position as a forerunner in the fast food industry. However, implementation of TQM would ensure all round benefits for the company (Jiménez-Jiménez et al., 2015). It would also help the company penetrate newer markets, break down barriers and promote a free flow of products and communication. TQO would help organizations attain competitive positioning by innovation of new products, improvement of existing products and reduction of prices.
2: Total quality management concepts and tools to be implemented at McDonald’s
At McDonald’s, one of the major issues faced is related to the quality of product and customer service delivered at various outlets across Australia. As such, the process of total quality management can be applied to the company in order to improve the overall performance of the organization. A few concepts and TQM tools must be implemented in this case. They have been discussed as follows:
Sanchez and Blanco (2014) have defined continuous improvement is an ongoing process at an organization which strives to improve the quality of products, services or processes at a firm. The process of continuous improvement is such that it can provide incremental improvement which takes place over a period of time or it may also provide breakthrough improvement which happens all at once. In the process of continuous improvement, the customer is usually the prime focus. Every aspect of improvement or change that must be made to the organization as part of the process would involve customer feedback. The purpose of such a process is to incorporate customer feedback with the organization goals to get optimum results. As a matter of fact, Clark, Silvester and Knowles (2013) have commented that continuous improvement would be instrumental in implementing lean operations within an organization. If lean was to be incorporated into the McDonald’s operational strategies, it would ensure that the process is flawless, seamless and free of defects. Continuous improvement and lean operations are concerned with periodic evaluation of operations and identification of glitches and defects which could be slowing the delivery process down. Any aspect of the operation which does not contribute to the welfare of the service delivery or improves the customer experience for the customer must be eliminated (Singh & Singh, 2015).
One of the most common tools in continuous improvement is that of the PDCA cycle, which is an acronym for “plan, do, check and act.” This cycle suggests that continuous improvement is a never ending cycle and keeps improving the process based on the results obtained. In the first phase, the company would have to establish a clear mission and goals, along with the expected outcomes (Pietrzak & Paliszkiewicz, 2015). For instance, in McDonald’s case, certain changes may have to be made in the supply chain to improve the quality of the end product. Similarly, the delivery process at the stores may have to be modified and enhanced to reduce waiting time for the customer (Kohlbacher, 2013). After the faults have been identified and plans have been made for change, the next step is execution. Post implementation, it is important to compare and contrast the performance of the company before the execution and after it, so as to get a comprehensive idea of further changes necessary. Based on that, more changes could be implemented and the cycle continues.
Six Sigma is another tool in total quality management that works towards increasing the overall capability of an organization. It works by decreasing process variation, defect generation and increases the performance of the company. It would also improve profitability, quality of products and services and boost the morale of the employees (Krueger, Mellat Parast & Adams, 2014). It is a data driven, disciplined and quality management approach which eliminates defects within the operations of a system and strives for perfection in the entire operations chain of a company, from manufacture of products to the delivery of service. In other words, Six Sigma is a tool which quantifies the quality of service at a company and puts a number on the lean operations within an organization. The tool suggests that a company that has successfully been able to implement lean would not be producing more than 3.4 defects per one million opportunities (Chakraborty & Kay Chuan, 2013). This can easily be calculated using a six sigma calculator and highlights the chances of defect in the operations of a company.
There are a number of ways in which Six Sigma can help McDonald’s. For instance, successful implementation of this strategy would help the company employees manage their time more effectively. The employees would be working according to specific goals and that would improve their overall productivity levels (Knapp, 2015). It would also reduce chances of delay in service delivery. Implementation of Six Sigma would automatically improve the quality of product and service delivered to the customer, thus improving customer satisfaction rates. It would also improve the rates of customer retention and loyalty. Moreover, it has been found that six sigma can shorten the length of the cycle of product delivery (Assarlind, Gremyr & Backman, 2013). With too many steps leading to the customer, there are often chances of delay and prolonged waiting periods. However, Six Sigma would successfully cut out unnecessary aspects of the product cycle, thus shortening it.
In simple words, service quality management may be explained as the comparison between the perceived or expected quality of a product or service and the actual performance of the company. A company which has high service quality management would be more equipped to meet the ever changing needs and demands of the customers than a company with low service quality. Such a company is also more likely to hold a favorable position in the market, with respect to its competitors (José Tarí, Heras-Saizarbitoria & Pereira, 2013). Improvement in service quality management would involve a renovation of operational procedures, identification of problems and systematic establishment of valid, reliable and practical performance solutions (Talib, 2013). It also includes measurement of customer satisfaction and incorporation of obtained results into TQM strategies.
At McDonald’s which operates within the food and beverages industry, the five principles of SERVQUAL are of prime importance. They are:
- Reliability– This refers to the brand’s ability to provide services accurately and dependably, while at the same time, abiding to the promises made to the customer.
- Responsiveness– This refers to the ability of an organization to respond to the changing needs of the customers and be prompt with their service delivery.
- Assurance– This is the ability of the company to convey trust and assurance to the employees, ensuring them of quality of food products and service delivered (Tseng & Wu, 2014).
- Empathy– Each customer is unique and thus personalized attention is compulsory. The company must also be considerate of the needs and requirements of the customer.
- Tangibles– This refers to the physical attributes of the company like brand image, appearance, ambience, facilities, packaging and so on.
In order to implement total quality management and the various tools and concepts mentioned above, the following steps would have to be followed (Calabrese & Corbo, 2015).
- The first step in the process would be clarification of the company goals and missions. Every aspect of the company’s TQM strategy would be customer oriented. Employees would have to realize that every action on their part would have an impact on the overall performance of the company.
- The critical success factors of the company would be identified. For example, the critical success factors in the case of McDonald’s would be the market share, customer experience, customer loyalty and product quality.
- Measures would have to be taken to accumulate customer feedback. This could be done through online surveys or questionnaires. For instance, the customers visiting the stores and outlets would be invited to take part in the survey. The data obtained from this survey would then be used to understand the level of customer service at the organization. This would also highlight room for improvement at the organization (Topalovic, 2015).
- There should be commitment on the part of all the employees towards quality management and improvement. A culture of continuous and ongoing improvement must be implemented within the organization which is based on cooperation and coordination between the management and the employees (Gimenez-Espin, Jiménez-Jiménez & Martínez-Costa, 2013).
- A map must also be created for the processes that require change and the course of action to bring about required change. For instance, while using the Six Sigma tool, the company would have to take into account the redundant procedures and unnecessary steps that slow down the service delivery process to the customer.
- Employee training is an important aspect of implementing TQM at McDonald’s. Each employee would have to be on board with the idea of change for improvement and they would also have to trained for successful implementation. For instance, if some technology is to be added to the operations as part of the continuous improvement process, adequate resources and training would have to be provided to the employees (Khanam, Siddiqui & Talib, 2016).
Conclusion
To conclude, it can be said that total quality management or TQM is one of the most useful strategies that any company can implement. It is entirely focused on the quality of service and product that is delivered to the customer. Total quality management can be said to be an integral aspect of every company since it ensures that top quality products are delivered to the customer in a timely and efficient manner. The above report presents an analysis of the concepts of total quality management in McDonald’s Australia and the myriad benefits it would entail. The three major tools of TQM have also been discussed, and an implementation plan has also been provided for the same.
References
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