Partnerships and Strategic Alliances

Introduction

This post explores the dynamics of strategic alliances, examining both the advantages and potential drawbacks they offer to participants. A strategic alliance is a collaborative arrangement, either within a company or between different companies, where all participants work to their common advantage, ultimately leading to improved total quality of products or services. The terms “strategic alliance” and “partnership” are used here interchangeably, though there is a slight difference: the partners in a strategic alliance work together while remaining separate entities, while partnering may include the formation of a new legal entity (a partnership) with shared assets and liabilities.

We begin by covering internal partnerships, with particular attention paid to partnerships between teams. Next, external partnerships are discussed, and an example of a global supplier partnership is covered. Finally, some of the partnerships formed by my former employer are described to illustrate these concepts in practice.

Internal Partnerships

Internal partnerships can be between employees, between management and employees, or between teams. “Partnering should begin at home” (Goetsch & Davis, p. 70). Employees and managers can work together in many ways, including problem-solving teams and brainstorming sessions.

Partnerships between teams within an organization permits ideas and technologies to be shared between them. Such partnerships may also reveal redundancies between the teams. When this happens, the teams could be merged or reorganized to either eliminate the redundant parts or have the redundant parts working together.

Despite these advantages, there are at least two potential problems when forming partnerships between teams. First, partnerships usually come with some form of bureaucratic overhead. Second, members of both teams may have to explain their efforts to more people. Either way, this takes away time for productive work.

External Partnerships

External partnerships take many forms, from partnering with suppliers, to partnering with customers, and even partnering with competitors. An interesting example of external partnerships is illustrated by consortium buying, which is when two or more small companies combine to purchase common items in bulk for purposes of reducing costs.

Partnering with suppliers attempts to invert the usual script where the company attempts to play suppliers off each other to minimize prices. As such, developing trust in supplier partnerships is a long-term prospect going through various stages from uncertainty and tentativeness to a mature partnering relationship. (Goetsch & Davis, p. 71).

A prime example of external partnering with competitors is the relationship between Apple Inc and Samsung. The type of strategic alliance between these two companies changed over the lifetime of the alliance: It began as an alliance between a company (Apple) and a supplier (Samsung), then quickly involved into an alliance between competitors.

In 2011, Apple decided to outsource manufacturing of the iPhone’s displays to Samsung, a company based in South Korea. Shortly thereafter, Samsung began manufacturing similar phones that utilized Apple’s intellectual property. Samsung was accused of infringing on design and utility patents, and this resulted in a series of lawsuits by Apple against Samsung beginning in 2011 (Müeller, 2012). By 2013 more than 50 suits and countersuits were in motion in the courts of the United States, South Korea, Japan, and the United Kingdom (Kastrenakes, 2018). Apple won the cases in the US, and Samsung won the cases in the UK, Japan, and South Korea. The damage was done, however: Apple’s competitors had learned the techniques that made the iPhone successful. As with many tech company rivalries, Apple and Samsung have settled into a “competitor with benefits” arrangement, and Samsung continues to supply displays for use in Apple’s products.

Outsourcing always comes with problems such as differences in time zones, languages, and culture. The relationship between Apple and Samsung revealed another difference: the legal support for intellectual property rights. A very superficial review of two of the standards used to evaluate partnerships with suppliers (Goetsch & Davis, p. 72) – the Malcolm Baldridge Criteria and ISO 9000 standards – shows that neither address the problems Apple Inc encountered.

Personal Examples

The software company for which I used to work, America Online (AOL), had formed an external partnership with XM Radio, later purchased by Sirius, and became SiriusXM. I was responsible for integrating XM Radio’s channel offerings into AOL’s music streaming service, AOL Music. The partnership was beneficial to both companies: AOL was able to offer twice the amount of content to customers, and XM Radio reached a much larger audience.

“Partnerships” with AOL usually involved the following cycle: a traditional supplier partnership established; AOL would then purchase the partner; the (former) partner would either be absorbed into AOL and then put out of business, or the acquired company would be spun off and become independent again or it would be sold to a buyer. The AOL/XM Radio alliance described above is an exception: both remained separate legal entities throughout the partnership.

An example of the way AOL partnerships usually work is demonstrated by AOL’s relationship with the Huffington Post (HuffPo). AOL partnered with HuffPo in late 2010 so that AOL could gain access to the blogging software they used. In 2011, AOL outright purchased HuffPo. The terms of the acquisition were unusual… AOL paid $315 million, and Arianna Huffington became president and editor-in-chief of numerous AOL properties including Engadget, MapQuest, AOL Music, and Patch. Later, in 2015, HuffPo was purchased by Verizon, along with the rest of AOL. Finally, HuffPo was sold to BuzzFeed.

From an employee’s standpoint, this was a serious violation of trust – the previous managers of those properties were all quite talented, and they were replaced by complete strangers who soon allowed most of those properties to fail.

Conclusion

Internal and external alliances can be beneficial to all participants. For example, smaller companies can engage in consortium buying, giving them the purchasing power of larger companies. If managed well, all parties can benefit from the relationship, lowering costs and improving customer satisfaction. External alliances, especially with competitors, have the potential to go very wrong, and standards such as the Malcolm Baldridge Criteria or ISO 9000 may not prevent this.

 

References

Goetsch, D. L., & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

Kastrenakes, J. (2018, June 27). Apple and Samsung settle seven-year-long patent fight over copying the iPhone. The Verge. https://www.theverge.com/2018/6/27/17510908/apple-samsung-settle-patent-battle-over-copying-iphone

Müeller, Florian. (2012, July 24). Apple seeks $2.5 billion in damages from Samsung, offers half a cent per standard-essential patent. FOSS Patents. http://www.fosspatents.com/2012/07/apple-seeks-25-billion-in-damages-from.html

Values, Ethical Decisions, and Total Quality Management

Introduction

This post explores how ethics and values relate to total quality management. It shows that ethical behavior both supports and reinforces a total quality environment. It considers some ways for managers and organizations to achieve (or not achieve) an ethical workplace, with focus on codes of conduct. Next, an approach to making ethical decisions is considered. Finally, the situation where there are no ethical actors in an organization is briefly examined.

Values and Total Quality Management

Values are qualities or things that we act to gain and/or keep. It is not something that’s just desired but something actively perused and maintained through one’s actions. The most important values in a business situation are honesty, confidence, initiative, and decisiveness, for it is through those values that a strong forward momentum is established and continued in any business or other organization.

Between individuals, the fundamental quality in relationships is trust, which is earned through repeated demonstrations of honesty. Trust can be built by being loyal to those not present, keeping promises, and apologizing when necessary (Goetsch & Davis, 2021, p. 54).

In turn, trust is the most important quality for total quality management (TQM). This is because trust is needed for building responsibility and accountability (Goetsch & Davis, 2021, p. 54). Trust among employees is also necessary for teamwork, communication, and smoothly operating interpersonal relationships. Trust is needed between managers and employees for purposes of conflict management, problem solving, and ensuring employee involvement and empowerment (Goetsch & Davis, 2021, p. 52-53). All these features result in a business dedicated to total quality and thereby placing the focus on the customer.

When trust and ethical values are consistently demonstrated by managers and employees, the company as a whole can earn a reputation of being trustworthy. Bad decisions, broken promises, and unethical behavior will occasionally be demonstrated by employees or managers of a trusted company, but those lapses will be seen as rare exceptions.

Individual Manager’s Approaches to Ensuring an Ethical Workplace

Goetsch & Davis (2021, p. 55) lists three managerial approaches to evaluate and motivate employees to be ethical. The best-ratio approach, also called situational ethics, requires the manager to “create conditions that promote ethical behavior and try to maintain the best possible ratio of good choices to bad choices and ethical behavior to unethical behavior.”

The black-and-white approach requires managers to view ethics in a more absolute manner, where conditions are irrelevant to matters of right and wrong. Managers must then make fair and impartial decisions regardless of short-term outcome.

With the full-potential approach, managers act so that employees will achieve their full potential, and that deciding according to this standard allows employees to be involved and empowered. This approach as well as the best-ratio approach both assume that people are fundamentally good.

Organization’s Approaches to Ensuring an Ethical Workplace

Two actions that organizations can take to create an ethical workplace are ethics training and establishing codes of conduct. Ethics training is straightforward, but there are numerous problems with codes of conduct (COCs), especially as they are used in the information technology and software development industry.

In software companies and software projects, COCs are used as Trojan horses to smuggle in politics into companies and projects. The types of politics imported are far left “woke” politics and are enforced through diversity, equity, and inclusion (DEI) hiring and promotion practices.

COCs and DEI standards are used to violate the First Amendment rights of employees and managers and are also used to terminate employees or project contributors on political grounds. Conservatives and Christians are the most common targets (Wakabayashi, 2017). The workplace environment becomes one where there is a breakdown of trust between employees and managers, and this interferes with teamwork, combined problem solving, and interpersonal relations. The environment no longer becomes one of total quality.

All this agitation can and has endangered the stability of software projects and entire software organizations. A current example of this is the Mozilla Foundation. Their original purpose was to create and maintain the Firefox web browser as well as to develop and advocate various web technologies. Recently, they have moved away from these core missions and now focus on initiatives such as "digital justice," "queer youth inclusion," "engaging race, gender, and sexuality perspectives," "LGBT climate change," and "digital activism for young feminists." (Mozilla Foundation, 2023, p. 38-43)

These initiatives were funded by taxpayer money through USAID. Now that USAID has been abolished, Mozilla is facing serious financial problems, and it may have to dissolve itself.

Such are the results of codes of conduct.

Model of Ethical Decision Making

Goetsch & Davis (2021, p.57) list nine ethical theories, methods of determining the ethical course of action in various situations. I take a different approach.

The model I use for making difficult ethical decisions is as follows: I ask myself what would one of my personal heroes (either real-world or fictional) do in a comparable situation? The real-world heroes I admire include Ethan Allen, Francis Marion, Paul von Lettow-Vorbeck, Lt Gen Chesty Puller, General Patton, Steve Jobs, and Elon Musk. For fictional characters I consider heroic, I would list Lantenac and Gauvain from Victor Hugo’s novel Ninety-Three, and Howard Roark from Ayn Rand’s The Fountainhead.

Lieutenant Colonel Paul von Lettow-Vorbeck

Conclusion

TQM assumes that the participants within an organization and its customers act ethically, as Goetsch & Davis (2021) make clear. They also provide sample ethical dilemmas (Goetsch & Davis, 2021, p. 59-62) for the reader to consider. All these examples assume that unethical actions are taken by a few “bad apples” and that the majority of the organization acts ethically.

Something not discussed in Goetsch & Davis are situations where all actors are unethical. Two recent examples of such organizations are the USAID and the Afghan National Army. Large scale fraud was common in both organizations, and all actors were in on the grift. TQM may be able to improve the ethical standing of an organization if there are at least some managers who could enforce ethical standards, but TQM seems powerless when everyone is corrupt.

References

Goetsch, D. L. & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

Lunduke, B. (2025, 25 February). How is Mozilla Spending that $1 Million from US Taxpayers? https://lunduke.substack.com/p/how-is-mozilla-spending-that-1-million

Mozilla Foundation. (2023). Public Disclosure of Form 990. https://assets.mozilla.net/annualreport/2024/b200-mozilla-foundation-form-990-public-disclosure-ty23.pdf

Wakabayashi, D. (2017, 7 August). Google Fires Engineer Who Wrote Memo Questioning Women in Tech. New York Times. https://www.nytimes.com/2017/08/07/business/google-women-engineer-fired-memo.html

TQM for Small Businesses

Is total quality management (TQM) applicable to small and medium-sized businesses? Consider for example a local hardware store where returned items (like a defective drill) are resold. The consequences are frustrated customers, incorrect stock levels, and leading to business failure. A TQM solution to this problem is to develop a checklist for classifying returns as either fit-for-resale or return-to-manufacturer. In addition, employees would require hands-on-training on how to use that checklist and take appropriate action on the returned item. This would then be codified into a standard operating procedure (SOP).

Does this solution count as a valid TQM solution? Yes and no.

It meets many of the conditions given by (Goetsch & Davis, 2020, p. 4): it is customer-focused, obsessed with quality, involves bottom-up training, teamwork, and employee involvement. There isn’t enough information to determine whether this supports the company’s strategy, however, as no explicit strategy was given. It is not clear how continual improvement is possible in the process of handling customer returns.

One implementation error is that everybody is not included (Goetsch & Davis, 2020, p. 13-14). TQM implementation is an all-or-nothing process, and the SOP wouldn’t terribly impact the company accountant, of course, but the accountant must take part. Who specifies an improved accounting process, and how is it tested?

Two problems with the SOP are the induced bureaucracy and required training. These problems are not specific to the example hardware store, but are endemic to TQM.

Bureaucracy – in the form of red tape, complex regulations, and administrative burdens – is the death knell of small businesses. The red tape and administrative burdens drain time, money, and people from productive purposes.

Training would require time and the efforts of at least one person acting a trainer. Of course the training would have to be repeated whenever a new employee is hired.

Here’s a small example of what TQM training looks like. The once-large software company for which I used to work was converting to TQM, which required training in TQM itself. When discussing the importance of processes, the instructor had us do the following exercise:

We were divided into groups of three, and given a pile of 10-20 pennies, all heads-up. The first person in the group was to flip all the pennies over (tails up) and pass the pennies to the second person. The second person was to flip the pennies over again (heads up) and pass the pennies to the third person. That was the process.

I asked the instructor something to the effect of “why not just slide the pennies from person 1 directly to person 3 without flipping them over. The result is the same.” His response was something like “that’s not the process.”

References

Baldacchino, G. (1995, March). Total quality management in a luxury hotel: A critique of practice. International Journal of Hospitality Management, 14(1), 67-78. https://doi.org/10.1016/0278-4319(95)00006-X

Goetsch, D. L. & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9th ed.). Pearson.

Manley, S. C., Williams Jr, R. I., & Hair Jr, J. F. (2024). Enhancing TQM’s effect on small business performance: A PLS-SEM exploratory study of TQM applied with a comprehensive strategic approach. TQM Journal, 36(5), 1252-1272. https://doi.org/10.1108/TQM-10-2021-0299

Cultural Assumptions of TQM

One aspect of total quality management (TQM) that doesn’t seem to be addressed is the cultural assumptions made by its proponents. By this I don’t mean the quality-focused culture, or the corporate culture that TQM seeks to replace (or at least modify). Instead, I mean national culture.

Both W. Edwards Deming (1900-1993) and Joseph M. Juran (1904-2008) developed their managerial theories over their entire lifespans, based on their experience working at Western Electric and for the U.S. Government, but it was in post-war Japan that they had their first opportunities to implement their theories.

Much later (in the 1980s) did American industrialists begin requesting the services of Deming. According to Goetsch & Davis (2021, p. 12), Deming was not received as warmly by Americans as he was by the Japanese. In fact, “Deming’s attitude toward corporate executives in the United States can be described as cantankerous at best.”

How much of Deming and Juran’s theories of management hinge on their experience in post-war Japan? Japanese culture has a reputation for being hierarchical which implies deference. According to Chara Scroope (2025):

Japanese society is generally collectivistic, whereby people often view themselves and others as members of a collective unit or group (whether it be uchi or soto groups, a family group or a broader social group). In this sense, members of a group hold collective responsibility (rentai sekinin) for the performance and actions of an individual. For instance, if one or a few members of the group indulge in poor behaviour, all others are collectively blamed. In turn, harmony (wa) is an important part of interpersonal relationships. As a cultural concept, harmony implies a sense of unity and conformity within a group, whereby interdependence may be emphasised over independence.

At the time Deming and Juran were teaching the Japanese about TQM, Japan had just lost World War II. They were a beaten people, an occupied nation. In fact, Deming's first visit to Japan was in July 1950, and the Allied occupation wouldn't end until 8 September 1951. Emperor Hirohito, their leader throughout the war, was considered divine in Japanese culture. Following Japan's surrender in World War II, the U.S. pressured Hirohito to renounce his divinity.

This is diametrically opposite to American culture, where rugged individualism reigns. The self-made man is an American invention, and our freedom and independence follow from this.

Does it even make sense to apply a management philosophy to Americans that was developed and tested on a culture so different from ours?

References

Goetsch, D. L., & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

Scroope, C. (2025). Japanese Culture – Core Concepts. Cultural Atlas. https://culturalatlas.sbs.com.au/japanese-culture/japanese-culture-core-concepts

Contrasting Deming and Juran

Introduction

W. Edwards Deming (1900-1993) and Joseph M. Juran (1904-2008) were early proponents of quality driven management, and their theories of total quality management (TQM) are quite similar. In this paper, two ways that they differ are considered: their definitions of quality and the organizational scope needed to implement TQM. The implications of these differences are traced, and the value these differences have to TQM as a whole are described.

Defining Quality

One difference between Deming and Juran are their definitions of quality. If we take (Goetsch & Davis, 2021, p. 3) as reflecting Deming’s definition, then "[Q]uality is a dynamic state associated with products, services, people, processes, and environments that meets or exceeds expectations and helps produce superior value." This statement doesn’t specify whose expectations are met or exceeded, but it could be those of management.

In contrast to this, Juran considered quality to mean “fitness for use” for customer needs (Godfrey & Kinett, 2007). As such, Juran understood that with quality initiatives, a company could reach a point of diminishing returns. The phrase “’Good enough’ is never good enough” would thus be more applicable to Deming, whereas Juran understood that technical improvements can be more costly than the revenue they return.

Organizational Scope

A phrase attributed to Juran is that "all improvement takes place project by project." Without knowing the exact source and the full context, it is not clear exactly what is meant. Joseph DeFeo, who is a Juran Institute advisor, notes that Juran wrote:

If an organization wants to have quality leadership (like Toyota at the time) they must create a habit of continuous breakthroughs (not small improvements but large ones). To do that one must organize for those improvements, project by project. (DeFeo, 2022)

DeFeo also notes that such a project must be approved by management to secure budgets, personnel, and facilities. Thus are the advantages of managerial legitimacy.

Can this be taken as contrary to TQM’s all-or-nothing approach? Again, without knowing the source or context, it is difficult to tell. Assuming that it is, then improvement can be implemented on a team-by-team basis, and so adopting total quality management can be completed in a reasonable amount of time in a cost-effective manner.

Compare this with the Deming Cycle, which seeks to “link the production of a product with consumer needs and focus the resources of all departments (research, design, production, marketing) in a cooperative effort to meet those needs.” (Godfrey & Kinett, 2007, p.9) This is accomplished through five steps: consumer research (plan), create a product (do), check that the product was made in accordance to plan (check), market the product (act), analyze how the product performed in the marketplace in terms of cost, quality, and so on.

By advocating for a project-by-project basis, Juran makes it unnecessary to involve many members from outside a team, thus limiting bureaucratic creep.

Analysis of the Differences

There are doubtless other differences between Deming and Juran, but differing definitions of quality and organizational scope alone show some of the problems with TQM and how Juran can solve them.

First, TQM has a well-deserved reputation for inflating bureaucracy. This can be seen in the Deming Cycle where making or improving a product would require the collective efforts of the research, design, production, and marketing departments. Instead of requiring the work of a single team, Deming would require four whole departments.

TQM also favors process over innovation. In the Deming cycle, innovation is driven through two sources. First is consumer research – the customer wants a product and Deming will unleash four departments to produce it. Second, innovation is driven by the competitors, which is never a good thing! The Deming cycle doesn’t consider the possibility of “market surprise” products like the iPhone, for example. When the iPhone 1 was released on 29 June 2007, some people were already using mobile phones, but the iPhone created a new, larger market: the smartphone market. Competitors like Palm and Blackberry were still waiting for their customers to tell them what to make; Apple showed the customers what they could purchase. This point is also missed by the Juran Institute (DeFeo, 2017).

Conclusion

TQM is a broad theory that requires any organization adopting it to potentially undergo major changes in organization and culture. The characteristics of TQM given in (Goetsch & Davis, 2020, p. 4) – strategically based, customer focused, continual process improvement, freedom through control, and so on – are either not clearly defined or are somewhat overlapping. It makes sense that instead of throwing out “customer focus” along with “freedom through control”, we could save the reasonable parts and reject the highly questionable parts. Comparing Deming with Juran shows that this may be possible, that TQM can be modified to make it highly practical.

 

References

DeFeo, J. (2017, 18 April). Tired of Running from the Competition? Fulfill the Customer Needs. Juran Institute. https://www.juran.com/blog/tired-of-running-from-competition/

DeFeo, J. (2022, 28 October). Project by Project Improvement Revisited. LinkedIn. https://www.linkedin.com/pulse/project-improvement-revisited-dr-joseph-a-defeo/

Godfrey, A. & Kinett, R. (2007). Joseph M. Juran, a Perspective on Past Contributions and Future Impact. Quality and Reliability Engineering International, 23, 653-663. https://doi.org/10.1002/qre.861

Goetsch, D. L. & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

What is Total Quality Management?

Introduction

This post follows Goetsch & Davis (2021)’s presentation of total quality management (TQM), focusing on its definition and common errors in implementing TQM. Next we look at two limitations of TQM given in a video by "megentlemen." The post concludes with recommendations about TQM implementation.

Definition and Characteristics of TQM

Total quality management (TQM) is a management approach that has the goal of achieving long term success through customer satisfaction. This is done by involving all members of an organization in a continuous effort to improve processes, services, products, and corporate culture. TQM strives to improve efficiency, reduce waste, and require consistent quality in company operations; crucial to achieving this is customer focus, continuous improvement, employee involvement, process-oriented thinking, and using all available data for decision making.

To understand this, we must first understand the concepts of “quality” and “total quality.” Goetsch & Davis (p. 3) give the following definition of the first concept: "Quality is a dynamic state associated with products, services, people, processes, and environments that meets or exceeds expectations and helps produce superior value." Expanding on this, they note that as standards change, what is viewed as a quality item (product, service, person, process, or environment) also changes, and that items must meet or exceed expectations (whose expectations?) and help produce superior value (for whom?). Superior value is unpacked as having three basic elements: "superior quality, superior cost, and superior service" (Goetsch & Davis, p. 3)

Total quality is the process of continually improving quality of products, processes, services, and costs. TQM is a management philosophy that achieves this process. Total quality is a competitive advantage, especially for companies operating globally.

Goetsch & Davis (p. 4) describes TQM using a graphic analogy involving a three-legged stool. The seat of the tool is labeled “customer focus,” and this represents the fact the customer is in the driver’s seat. Supporting this are the three legs of the stool: measures, people, and processes. Quality can and must be measured using statistical process control, benchmarking, and quality control tools. People are empowered to do their jobs the right way. Process is one of continual improvement. "'Good enough' is never good enough" (Goetsch & Davis, p. 4). To be more specific,

The distinctive characteristics of total quality are these: strategically based, customer focus (internal and external), obsession with quality, use of the scientific approach in decision making and problem solving, long-term commitment, teamwork, continual process improvement, bottom-up education and training, freedom through control, unity of purpose, and employee involvement and empowerment, all deliberately aimed at supporting the organizational strategy. (Goetsch & Davis, p. 4)

Notice the Orwellian phrasing here: “freedom through control”, “unity of purpose”, “'Good enough' is never good enough.” Along with this is the “scientific approach in decision making and problem solving,” which smacks of Taylorism (Nyland, 2024).

Implementation Errors

As can be expected, implementing TQM in an established company or organization is not a bloodless and pain-free affair. Goetsch & Davis identify five common errors (Goetsch & Davis, p. 13-14).

The first error is senior management delegation and poor leadership – this happens when senior management delegates the switch-over to TQM to a hired expert, as opposed to applying leadership to get all employees involved. Hired experts are still allowed in training or advisory roles.

Second is what Goetsch & Davis call “team mania.” This is the idea that for teams to be effective, there must be teamwork: “Supervisors must learn how to be effective coaches, and employees must learn how to be team players.” (Goetsch & Davis, p. 13)

Third, the deployment process can be done erroneously. TQM must be deployed in an all-or-nothing approach, and must be adopted by operations, budgeting, marketing, and all other departments.

When adopting TQM, some organizations assume that major proponents (Deming, Juran, Crosby, etc.) must be followed literally. Instead, TQM programs must be tailored to individual needs of the organization, and failure to do so is the fourth error.

Finally, there is confusion between TQM education and awareness vs inspiration and skill building. Knowing the goals and methods of TQM are different from being inspired by the concept and seeking out relevant training to be “part of the transformational process” (Goetsch & Davis, p. 14).

Limits in Implementation

There are (at least) two limitations of TQM implementation, described in the video (megentlemen, n/d): the cost of adopting TQM in time and money, and the fear of change.

Implementing TQM is a lengthy process, taking many years and requiring substantial training. Overall, it is an expensive and exhausting process. In terms of length-of-implementation, Goetsch & Davis present management-by-accounting as a kind of opposite to TQM, stating that TQM is a long-term concept whereas management-by-accounting is a short-term concept that leads to short-term strategies (Goetsch & Davis, p. 29).

The second limitation is the idea that fear of change, uncertainty, and doubt (FUD) are major roadblocks to implementing TQM. This places the blame for unsuccessful or difficult adoption of TQM on those attempting to use the system, not on TQM itself. The FUD excuse comes off as a description of why pyramid schemes fail, or why socialism fails (“socialism needs a better class of people”).

These two limitations should not be taken in isolation – to get people who don’t have FUD over TQM, it is necessary to “age out” those who do. Fortunately, implementing TQM is a lengthy process.

Recommendations

As a person who experienced a flawless and professional implementation of TQM by a former employer, I cannot recommend TQM be implemented in my place of work. Further, I would not recommend TQM even to my competitors. The reasons for this are as follows: the cultural assumptions of TQM, the inflated bureaucracy, the emphasis on process over innovation, problems with responsibility and authority, the conflation of leadership with management, and the "sacred cow" problem all make TQM antithetical to companies whose existance requires that they be innovative and "scrappy."

References

Goetsch, D. L. & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

megentlemen. (n/d). busi616_Total Quality Management. https://libertyuniversity.instructure.com/courses/812038/pages/watch-total-quality-management?module_item_id=87787197

Nyland, C. (2024, 24 March). Writing Red Taylorism into management history. Journal of Industrial Relations, 66(3), 484-504. https://doi.org/10.1177/00221856241238611

Process Benchmarking

Introduction

In this discussion post, process benchmarking is defined, and it is compared with seemingly related concepts as well as other types of benchmarking. The application of benchmarking in the information technology (IT) industry is discussed, and then it is applied to a fictitious software company. Finally, it is noted that while all companies and organizations can benefit from benchmarking, contemporary industrial manufacturing (Industry 4.0) companies can especially benefit from it, due to Industry 4.0’s similarity to the IT industry.

What is Process Benchmarking?

Goetsch & Davis (2021) define benchmarking, specifically process benchmarking, as “the process of comparing and measuring an organization’s operations or its internal processes against those of a best-in-class performer from inside or outside its industry.” (p. 360)

This is different from competitive analysis, which is what customers do. Benchmarking is not about comparing the final product or service of two companies. Rather, benchmarking involves comparing the underlying processes used to produce a product or service, distribute it, and support it. The goal is to find a “secret sauce” another company uses and adopt that to one’s own company. That other company is called a benchmarking partner. If possible, the benchmarking partner should be “best-in-class,” at least in the particular process under comparison.

Benchmarking should also not be confused with so-called “best practices.” In software development, best practices are frequently arbitrary constraints not backed by any measurement. Best practices’ popularity is simply based on the insecurities that many IT employees and managers have.

Yarrow & Prabhu (1999) present three different modes of benchmarking: metric benchmarking, diagnostic benchmarking, and process benchmarking. The first concerns comparisons of performance data. They state:

So long as we are comparing `apples with apples’, metric benchmarking can serve a useful purpose as a `call to action’. However, its emphasis is on the `what’ rather than the `how’. This form of benchmarking can help an organization to pinpoint aspects of performance that need to improve, but on its own it cannot help them to learn how to improve. (Yarrow & Prabhu, 1999, p. 794)

Process benchmarking “involves two or more organizations comparing their practices in a specific area of activity, in depth, to learn how better results can be achieved.”

The third approach, diagnostic benchmarking, “seeks to explore both practices and performance, establishing not only which of the company’s results areas are relatively weak, but also which practices exhibit room for improvement.”

Benchmarking in IT Departments

In large companies with multiple independent software products, it is possible for different product teams to become benchmarking partners, if one of the teams has some metric that is significantly better than the other team’s. Even then, benchmarking with other companies could still be needed to achieve best-in-class quality.

Companies or organizations which have IT departments (which means all companies and organizations) all have certain problems in common. These problems include: what is the best database to use? What is the best way to test software? What is the best way to make websites publicly available? What is the best way to secure a computer system? and so on.

Because of this, it is possible to have benchmarking partners from widely varying industries.

The solutions to these problems are exchanged on an informal basis. IT workers frequently participate in user groups, either in-person or online. There are also online forums, product-specific support groups, etc., that can be used as sources of information.

Information gained through user groups or forums is purely anecdotal. Once this (unverified) solution to a problem is found, it must be evaluated and reviewed. This usually starts with a competitive analysis. Once it is determined that the proposed solution should indeed solve the specified problem, the solution will be implemented on a trial basis. If the trial is successful, the solution will be deployed on a wider basis. This process is called A/B testing.

Benchmarking in a Fictitious Organization

Software companies like Gaggle dot Com often find that there are two different ways to improve some aspect of a company’s IT department. To be concrete, suppose a certain database’s performance has been subpar. This can be improved by either changing some configuration property of the database or by replacing the database with one made by a different vendor.

By reading documentation and the forums of the database vendor, a configuration change may be found that improves the database’s performance. Or the problem can be described in a forum post along with a request for help. This is not benchmarking, however – it is more like self-improvement.

Real benchmarking would happen when Gaggle dot Com finds a benchmarking partner, say at a conference or user group meeting. This would be an informal and ad hoc relationship and would be the situation when a replacement database can be recommended. This is again anecdotal evidence, and it must be verified using A/B testing as described above.

In situations like this, a metric comparison with the benchmarking partner does not make sense simply because the entire processes (database plus everything else) are too dissimilar, like apples-to-oranges.

There are two quantitative comparisons that can be made, however. The first is to compare the performance of the database, acting alone, used at Gaggle.com and the benchmarking partner. In the classification that Yarrow & Prabhu (1999) present, this would be process benchmarking, where the “process” is strictly limited to the database.

The second comparison involves measuring the performance of Gaggle.com’s entire system both with the old database and with the new database in place. This is what Yarrow & Prabhu would call diagnostic benchmarking. As Yarrow & Prabhu (1999, p. 794) note, “diagnostic benchmarking is more akin to a `health check’ for the company, helping to identify which practices need to be changed and the nature and extent of performance improvements which should follow.”

In using either process or diagnostic benchmarking, Gaggle dot Com om has improved its database performance, perhaps even exceeding that of the benchmarking partner, and so have delivered a higher quality service to our customers.

Conclusion

The approach to benchmarking described here – combining process and diagnostic benchmarking – is not limited to the IT industry. As Wolniak & Grebski (2023) notes, any company can benefit from competitive benchmarking. In particular, Industry 4.0 is a transformation of traditional manufacturing processes using digital technologies, data exchange, and automation. As such, Industry 4.0 companies share the tools of IT companies, and the process and diagnostic benchmarking should be applied there, too.

References

Goetsch, D. L. & Davis, S. B. (2021). Quality management for organizational excellence: Introduction to total quality (9^th ed.). Pearson.

Wolniak, R., & Grebski, W. (2023). The usage of benchmarking in Industry 4.0 conditions. Zeszyty Naukowe Politechniki Śląskiej. Organizacja i Zarządzanie, 188, 665-676. http://dx.doi.org/10.29119/1641-3466.2023.188.40

Yarrow, D. & Prabhu, V. (1999). Collaborating to compete: Benchmarking through regional partnerships. Total Quality Management, 10(4-5), 793-802. https://doi.org/10.1080/0954412997820