Economic Rationale of Total Quality Process


Prasad, Amritanshu; Dasaratha   (1991, ASQC)   Steel Authority of India Limited, Ranchi - 834002, Bihar, India

Annual Quality Congress, Milwaukee WI    Vol. 45    No. 0
QICID: 9671    May 1991    pp. 369-373
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Article Abstract

Total Quality Process (TQP) is an attempt to attain a dynamic and harmonious equilibrium by integrating the strengths of various techniques and strategies. This paper examines the economic rationale of TQP and highlights the direct economic gains that result due to TQP implementation.

To access the economic raison-d�tre of TQP, the authors make the following assumptions: (1) TQP is a function of C, R and T where C = Customer satisfaction, R = Resource utilization, and T = Technology application; (2) R and T are inversely proportional to each other for a particular level of customer satisfaction; (3) Keeping R constant, T is directly proportional to C and vice versa; (4) There is an optimum economic combination of R and T corresponding to the highest customer satisfaction (C) attainable; and (5) Every industry is exposed to a set of customer satisfaction curves.

The authors provide numerous charts to illustrate various levels of customer satisfaction and its relationship to resource utilization and technology application. The results indicate that when an industry invests in technology applications, such as tools and state-of-the-art equipment, it must place equal emphasis on training and making organizational adjustments that will enable them to be more productive with the new technology.


India,International,Productivity,Total Quality Management (TQM),Economics

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