January 2002
Volume 9 • Number 1

Contents

Overview of Quality Management Practices in Selected Asian Countries

by Teng Heng Chan, Nanyang Technological University and Hesan A. Quazi, Nanyang Technological University

Multinationals face certain problems implementing productivity improvement programs across Asia because of the diversity of the various countries. This is a comparative study on quality management (QM) conducted in nine Asian countries from 1996 to 2000. The study sought to identify some of the factors behind these problems. Data were collected under controlled conditions using a standardized pretested questionnaire. The regional/country and microfactors influencing the evolution of QM practices into more sophisticated forms (TQM and beyond) were researched.

It was found that regional factors are related to the state of industrialization and economy of the country, intensity of government QM initiatives, the role played by multinationals to disseminate QM technology, and the maturity of such practices in the country.

Based on the maturity of QM practices, three groups of countries could be identified: The first group includes South Korea and Singapore, which are differentiated by their global and world-class QM practices. The second group consists of Malaysia, Philippines, India, and Indonesia, which have installed the equivalent of a Malcolm Baldrige Award. The third group, made up of Thailand, Brunei, and Bangladesh, has instituted ISO-type QM systems. A combination of government, industry, and indigenous factors has led to such groupings.

Microfactors tend to be more specific and peculiar to a country. These may include the following: personal involvement of the Prime Minister (Malaysia), the apathy among manufacturers on QM (Bangladesh), the presence of a QM champion (India), and the push for survival (Singapore). The time sequence for the diffusion of QM technology across Asia can be identified as follows: QCCs started in the 1960s. These were followed by TQC (late 1970s), TQM (late 1980s), ISO 9000 (1992), and world-class practices (after 1995).

Key words: Bangladesh, Brunei, comparative study, India, Indonesia, ISO 14000, ISO 9000, Korea, Malaysia, Malcolm Baldrige Award, Philippines, QCC, Singapore, Thailand, TQM

INTRODUCTION

Management researchers note that there are three basic approaches to management: classical, behavioral, and management science (Haynes and Massie 1969; Koontz, O’Donnell, and Weihrich 1984; Donnelly, Gibson, and Ivancevich 1987). Management science approaches can be traced back to World War II, when leading scientists were requested not only to solve operations research problems in dislocating the enemy but the manufacturing and logistics supply problems as well. After World War II, U.S. interests in such problems continued as the United States rebuilt the supply of manufactured goods and sold half of them across the world to Europe and the Far East. By the 1950s and 1960s, the management science approach was refined sufficiently to enable management techniques and tools to be applied to production scheduling, plant location, and output improvement. Visits to Japan by Deming, Juran, and Feigenbaum (Bounds et al. 1993) formally started the quality control concept in Japan in the 1950s. This was refined in the 1960s with the publication of quality control handbooks (Juran 1962). Deming propounded that consistent quality focus would reduce nonproductive variables, such as product reworks, production errors, delays, and production “snafus” (Deming 1986). Based on this premise, the Japanese companies, which adopted Deming, Juran, and Feigenbaum’s concepts earlier than the Americans, concentrated on quality throughout their production process. They showed that this resulted in much higher productivity and improved quality than just focusing on quality control at the endpoint of the production process (Ishikawa 1985). Changes in quality control activities led to the development of quality assurance, which involved the use of statistics applied to the manufacturing process, rather than at the output stage only (Taguchi 1986). Although the Japanese management techniques involving quality control circles (QCCs) were well known (Ishikawa 1984), QCCs were not widespread in the United States until much later. Today, work teams in U.S. corporations have replaced QCCs (Davidson 1995).

More than 20 years after the Japanese used the companywide quality concept, Feigenbaum (1983) wrote a book on total quality control (TQC), which suggested that quality control should be companywide. Later, management writers identified that if the TQC concept involved management, it would be more effective since managers would have more authority and impact in organizations. This led to adopting the concept of total quality management (TQM). Philip Crosby’s book Quality Is Free (1979) expounded very well on the quality concept in layman’s language. Business magazines, together with Crosby (1979), popularized TQM in the United States as they repeatedly highlighted how Japanese companies were gaining market share from U.S. companies at a time when the U.S. companies were facing losses amidst mounting customer complaints. The “secret weapon”—the magazines wrote—was the use of a management concept called “TQM.”

By the mid-1980s, TQM was so well known that it was thought to be the in-thing for companies to implement. The U.S. government, which was facing pressure from U.S. businesses to respond to the Japanese success, had to act. In 1987, the U.S. Department of Commerce established the Malcolm Baldrige National Quality Award to reestablish higher standards of manufacturing, which was based on a QM culture. Internationally, Japan was already giving the Japanese Deming Award to outstanding companies, and this award was regarded as the most prestigious of all quality awards. To counter this, and to aid the promotion of TQM in United States, Utah State University established the Shingo Prize for Excellence in Manufacturing in 1988 to encourage world-class manufacturing practices.

Further developments in the 1990s led to the adoption of ISO 9000-equivalent manufacturing standards, which was implemented in Europe and the rest of the world. The American Good Manufacturing Practice, although required by American companies for imports into the United States, did not satisfy the independent assessment criteria required by ISO 9000. U.S. companies had no choice but to adopt the ISO 9000 standards to meet European market standards.

Although TQM and ISO 9000 were adopted by the manufacturing and services industries, these concepts could not stem the losses faced by U.S. companies during the economic slowdown in the late 1980s and early 1990s. Hence, at about this time, Hammer (1995) argued that perhaps companies need to completely rethink how their operations could be reorganized so that significant breakthroughs in quality and costs—items that affect the bottom line—could be obtained. Hammer called his concept “business reengineering” (Hammer 1995). Five years later, companies found that reengineering could not transform every business, as the changes associated with this concept were complex, extensive, and expensive.

Today, managers are still looking for new ways to manage their businesses but the focus on quality has evolved. The compliance form of quality (such as quality assurance, ISO 9000, and ISO 14000) and management excellence (such as those contained in the Baldrige Award criteria) has now become ingrained in the culture. Now, blind compliance, akin to adherence to the letter, is not encouraged.

Because of the large number of companies in the United States, there is literally a huge amount of published literature on QM. Despite this, the answer to the implementation of QM is not straightforward. In Asia, cultural and geographical diversity makes the implementation of QM more difficult.

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