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Companies Are Not Clocks

TQM means Total Quality Management, which means the perfect company. That, at least, is what business management handbooks tell us. The model seems to be that of a company run like a clock that keeps perfect time and that is well oiled and resistant to all weather conditions. In actual fact, TQM has to deal with the people who need to create it and make it work. That is quite another matter.

The book by Radoica Luburić, of the Central Bank of Montenegro, helps link the theory of TQM with the practice and, above all, with the human and social aspects that influence it.

The study explains that, with TQM, “it should be possible to create a model that ensures a higher level of quality and, at the same time, a higher level of management.” In other words, Total Quality Management is indeed “a paradigm of business success throughout the world.” It is a concept that “instils confidence in customers and triggers chain reactions that lead to improved relations with suppliers.” But this still does not quite explain what total quality actually is. In other words, there are strong links between TQM and the culture of cooperation within the company itself.

Using a series of diagrams that illustrate the intersections between quality, work, management and consequent actions, Luburić clearly explains what this means. And, moving on from the theory of TQM to the way it is put into practice in Japan, the USA and Europe, Luburić adds some important analytical elements.

“The Japanese”, the study explains, “are so obsessed with quality that they almost throw a party when they find a mistake, because they see it as further incentive for yet greater improvements.” The way decisions are made in U.S. firms, however, is completely different from what goes on in Japanese companies. According to Luburić, few people actually make decisions in American companies: this makes things quicker, but then many more people in the company need to be persuaded that the decisions were right. The Europeans adopt yet another approach, which Luburić believes is summed up in the words of Raymond Levy (chairman of Renault in 1990), who said: “Quality is representative of a culture which we Europeans have no reason to let others monopolise. The Europe of Descartes, the Europe of the Age of Reason and the Enlightenment, the Europe of the industrial and technological revolution of the last two centuries holds within itself all the elements of method and exactitude conveyed by the term ‘total quality’.”

In other words, TQM is not a mechanism but a way of being and it certainly needs to be sought in every company, but it is not enough on its own. Quite simply because companies are not clocks: they contain men and women, not cogs and springs. As we were saying, it is quite another matter, but also quite another level of quality.

Total Quality Management as a Paradigm of Business Success

Radoica Luburić (Central Bank of Montenegro)

Journal of Central Banking Theory and Practice, 2014, Vol. 3, No. 1, pp. 59-80