Total Quality Management and Competitive Advantage

Create a thesis and an outline on Total Quality Management and Competitive Advantage. Prepare this assignment according to the guidelines found in the APA Style Guide. An abstract is required. Any firm that follows the strategy of cost leadership, targets at becoming the only producer in the entire industry whose cost of production would be lower than all its competitors. The producer seeks to exploit economies of scale and follow competitive pricing (Richardson and Dennis, 2003). Cost leadership strategy is a key to success for several successful companies. one among them is Walmart (Baroto, Abdullah and Wan, 2012).Under this strategy, the firm concentrates on becoming unique in the products it offers. It does this by identifying certain product dimensions that consumers value the most. The firm develops its production and marketing strategies in such a way that it can satisfy the customers’ demand for those attributes and hence receives a premium price for that uniqueness. For example, Apple Computers makes “differentiation by technology” (Baroto, Abdullah and Wan, 2012, p. 120) to preserve its competitive advantage.The firm selects either a group of segments or a single segment from the industry in which it belongs and optimizes its strategies to serve these segments so well, as to gain a competitive advantage over all its competitors. A firm can pursue this by either creating a cost advantage in a targeted segment (cost focus) or by developing a differentiation in a targeted segment (differentiation). Tesco follows the focus strategy to blend elements of both differentiation and low cost (Baroto, Abdullah and Wan, 2012).Total quality management (TQM) is “an art of management” (Singh, Qureshi and Butt, 2007) that became popular with business organizations in the 1980s. Clark (1996) has explained that this management strategy focuses on maintaining quality of in all processes running in an organization. manufacturing, human resource, financial procurements, R&D and administration. Implementation of total quality management provides a framework that guides the organization to select competitive advantages in the face of uncertainty. These competitive advantages become the foundation on which operational decisions are made regarding the marketplace (Tseng and Lin, 2008). Quality management is an approach that many firms consider the basis for making differentiation from competing firms (Singh, Qureshi and Butt, 2007). The role played by TQM in a firm is that of creating a demanding work environment and also lay down ways to fulfill the demands through team spirit, mutual trust, honesty, open communication, and fun. In this framework, changes are appreciated, fear is defeated and resistance towards change is treated with corrective action. Improvement in organizational effectiveness contributes to profitability by augmenting the market share possessed by the firm (Yasin and Alavi, 1999).One important factor that plays behind the competitive advantage enjoyed by New Zealand based Fisher & Paykel Appliances Ltd. (F&P) is their creativity and innovative capacity (Elliott, 2004). Through extensive case studies and primary interviews, Elliot has established an empirical validation of the relationship between “sustainable competitive advantage” (Elliott, 2004) and TQM. The core values harnessed with every level of operation and management within the organization enhances the efficiency and competence of the employees, which generate their competitive advantage over other players in the home appliances industry in New Zealand. F&P maintains a mature partnership with the Engineering, Printing and Manufacturing Union (EPMU).

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