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SMEs and Total Quality Management 

The concept of Total Quality Management (TQM) has gained prominence during the last two decades both in the developed and developing world.  Although the practices of TQM have been prevalent over a century, such practices were not recognised as such in management strategy and literature. 

The acceptance and practice of this concept has spread to almost every forward looking enterprise today.  The concept cuts across manufacturing as well as service sector firms.  It is believed, that in the competitive world of today those who do not commit themselves to TQM will find it more and more difficult to meet their customers' demands.  Thus, TQM has become more than a way for a business to improve the quality of their products and services but could become the key to survival of the enterprise.

 However, the concept and the practice have been slow in permeating the SME sector, especially in the developing countries.  There are a number of reasons for this slow acceptance.  One principal reason being that when one expounds TQM, this concept is understood by small enterprises to be the prerogative of the larger companies.  This is especially true when the examples quoted of centres of excellence, they are usually from large companies and conglomerates such as Xerox, IBM, AT&T and others.

 There is, however, growing evidence that SMEs in some sense are better placed to adopt a quality management culture.  This is due to the premise that some of the ideal conditions that facilitate TQM are already present in the make-up of most small firms, both in the service and manufacturing sector.  These are, transparent and accessible management, visible leadership, easy communication lines, intimate knowledge of the process, product and service, close supplier/customer relationships, togetherness of the work-force both in physical and social proximity and pride of workmanship of the skilled worker.

 If you analyze the work environments of one product or a few products' of service or manufacturing firms, one would notice that all or most of these ideal conditions are present.  It is, therefore, only a step away from realising the potential of TQM, if there is commitment from the owner manager to introduce a quality culture through the introduction of the five basic ingredients of TQM.  These are management commitment, customer focus, continuous improvement, team work and cooperation.

 It is obvious that such ingredients are much easier to achieve in a single 'roofed' small company where all activities take place in close proximity to one another.  In such a situation, management commitment can be more easily demonstrated, due to personal presence of the owner with the contact he has on a daily basis with the work group and in many instances the owner lives next door to the business premises.  External and internal customer focus is also easy to come by, as the internal customers within the firm are few and intimately known to one another and in the case of the external customers, in many instances it is one customer or a small group of customers, who are familiar with the small business, the owner, and the workforce.

 Continuous improvement is facilitated as there is close rapport with what the customer wants or improved which is discussed openly in the work place between the owner and the client.  Further, the physical proximity of the manufacturing process, commencing from the raw material stage to the final product prepared for despatch, familiarizes each worker with the processes and most workers know each other's job.  Teamwork follows from this as they work as a team with many employees playing multifunctional roles including the owner manager, without any status barriers.

 The question that can be posed is, why is the motivation not present, or weak for SMEs to adopt TQM principles, despite the ease of adoption and the likely advantages.  The answer obviously lies in the lack of awareness and being too busy with survival procedures without realising that TQM could be the panacea for all ills.

 Statistical analysis of life cycles of SMEs in many developing countries show that the survival rate of SMEs especially in their early years are low.  There are many reasons both internal and external, for such low survival rates.  However, one rarely comes across among the 'armoury' of interventions for SME development in the less developed countries, the need to introduce efforts to inculcate the advantages that they would derive in embracing TQM at the very beginning.

 This obviously will have to begin with owner managers through a process of awareness creation by demonstration rather than by top down lectures, to imbue them with the motivation and acceptance of the concept, which is so close to them.

 (Source: Technonet Asia – Newsletter)

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