Abstract

The purpose for this study is “The Effect of Total Quality Management (TQM) On Organizational Performance of SMEs in Buea”. Its specific objectives are to determine the effect of continuous improvement on organizational performance of SMEs in Buea, to investigate the effect of customer focus on organizational performance in SMEs in Buea and to assess effect of employee involvement on organizational performance in SMEs in Buea.

A descriptive research design was adopted as appropriate study designs were a sample of 80 employees of SMEs in Buea were selected simple random sampling techniques. It also combined quantitative as well as qualitative research approaches. The quantitative methods of data collection were used in this work were a self-administered questionnaire composed of closed ended, and likert scale questions was used to collect data from the respondents.

Data obtained through a structured questionnaire were analysed using analysed using descriptive statistics and the multiple regression analysis (Ordinary least square Regression technique) with the help of Statistical Package for Social Sciences (SPSS) software. The findings show that TQM has a significant impact on organizational performance of SMEs in Buea.

Continuous improvement has a negative and significant effect whereas customer focus and employee’s performance has a positive and significant effect on organizational performance of SMEs in Buea. The study therefore recommends that effective TQM should put in place so as to increase the Organizational performance of SMEs.

The study further recommends that for every policy measure taken by SMEs to improve TQM, continuous improvement, customers focus and employee’s involvement should be taken into consideration because failure to do so will lead to detrimental effect on organizational performance.

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Under the developing and changing world conditions, businesses in the race which is excessively competitive and to be able to grab rapidly increasing market share with the developing technology have to revise their understanding of quality and decrease the margin of error in the product or service they produce in order to be able to survive and compete and reach the level they want and maintain this level. In this context, organizations began a ‘quality race’ and Total Quality Management (TQM) approach gained importance.

Hill (2012) identified that total quality management is a firm-wide management philosophy of continuously improving the quality of the product/process by focusing on the customer satisfaction and organization’s performance. There are mixed results about the relationship between total quality management practice and performance.

The success of any organization is completely determined by the quality of services that they produce, especially in competitive market place, this therefore brings the relevance of the ideology and practice of total quality management into place Katardjieva (2015).

Most organizations still believe that the traditional quality control techniques and the way they have always been is still the best and resolve their quality problems, but this however is wrong. Employing move inspectors, developing correction repairs and re-work teams doesn’t promote quality (Edward 2010).

Traditionally, quality has been seen as the responsibility of quality control (QC) department and it has still not been recognized in some organizations that many quality problems originate in the marketing, sales services and administrative areas.

Total Quality Management (TQM) is more than shifting the responsibility of problems from the customer to the producers. It requires an approach, which must first be implemented if the rewards are to be realized. Today’s business environment is such that managers must plan to maintain a hold on market share according to Zadey and Yosuf (2011).

The methods and techniques used in total quality management can be placed through any organization. They are equally in marketing, health care, education and hospitality industries. (Hassan et al, 2013) identified that the impact of total quality management on an organization is first to ensure that the management adopts a strategic overview of quality. The approach must focus on developing a problem prevention mentality, but it is easy to underestimate the effort that is required to change approaches.

Many people will need to undergo a complete change of mind to their institution, which rushes into inspection mode to solve quality problems (Lawler et al, 2011). The correct mind set may be achieved by working at the sorts of barriers that exists in the key areas.

Staff will need to be trained and shown how to relocate their time and energy to studying their process in teams, searching for cause to problems and correcting the causes, not the symptoms for once and for all. This will require of management a positive initiative to promote the night first time approach to work situations. Through process improvement teams, which will need to be set up, these actions will reduce naturally the inspection-rejection syndrome (Eskildson, 2009). If things are done correctly first time around, the usual problems that create the need for inspection for failure will disappear.

Total Quality Management strategy is a business management strategy that sees the organizational customers and creates as the key to organizational success. However, some companies define quality by engineering standards (Matata, 2015).

Effective Total Quality Management (TQM) strategy entails that the product quality must go beyond acceptability for a given price range. It must involve every staff in the organization and in every department. It expresses the conviction that in order to improve quality, the organization must regularly conduct surveys most from its customers (Internal and External customers) to evaluate its quality improvement programs and strategies (Bahri, 2012) Total Quality Management (TQM) strategist in organizations should measure performance against customer’s standards not determined by the company’s quality engineers.

However, firms that do not practice Total Quality Management (TQM) might experience internal and external loss of faith by the organizations senior staff on each other and low morale, see for example, Hendricks and Singhal (2007).

Finally the ideology of Total Quality Management (TQM), emphasizes on the improvement of product quality and service delivery (Magutu, 2010). Managers improve durability and enhance a product passes through its life cycle managers also strive to speed delivery and improve other services to keep their brands (products) competitive.

 1.2 Statement of the problem

This research work is aimed at understanding the effect of Total Quality Management on Organizational Performance. Manufacturing industries plays an important role in the production and distribution of national income. The revenue and skills gained by the sector contribute to faster growth in national income; an expansion of the system contributes to more equal sharing of the national income.

The quality of performance of firms can be improved by implementing quality management models such as Total Quality Management (Varghese, 2013). Total Quality Management (TQM) implies an organization’s obsession with meeting or exceeding customer expectations. It is an approach for continuously improving the quality of goods and services delivered through the participation of individuals at all levels in functions of an organization (Pfau, 1989).

Many Manufacturing industries are embracing TQM practices and have gone further to attain ISO 9001:2008 certification. Many global, regional and local studies have underscored the role of TQM practices in enhancing customer satisfaction in an organization (Crosby, 2000; Oakland, 2003; Denning, 2006; and Feigenbaum, 2006).

These studies have, however, concentrated on the impact of TQM practices on performance of profit making organizations. Past studies have also focused on manufacturing industries but little has been done (Obaraet al.,2010). This confirms that there is very limited literature on effect of TQ practices on manufacturing industries. The study therefore, seeks to determine the impact of TQM on the performance of manufacturing industries specifically Source Du Pays (SARL).

1.3 Research Questions

1.3.1 Main Research Question

What is the effect of TQM on organizational performance in SMEs Buea?

1.3.2 Specific Research Questions

1. What is the effect of continuous improvement on organizational performance in SMEs in Buea?
2. What is the effect of customer focus on organizational performance in SMEs in Buea?
3. What is the effect of employee involvement on organizational performance in SMEs in Buea?

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