Total Quality Management in the Automotive Industry

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08/02/20 Management Reference this

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INTRODUCTION

 The term Total Quality Management (TQM) refers to a quest for quality in an organization (Stevenson, 2015). There are three key philosophies in this approach (Stevenson, 2015). One is a never-ending push to improve, which is referred to as continuous improvement; the second is the involvement of everyone in the organization; and the third is a goal of customer satisfaction, which means meeting or exceeding customer expectations. (Stevenson, 2015). TQM expands the traditional view of quality—looking only at the quality of the final product or services—to looking at the quality of every aspect of the process that produces the product or service (Stevenson, 2015). TQM systems are intended to prevent poor quality from occurring (Stevenson, 2015).

According to Best Buy, the Top 2 Car Brands in the World 2018 is #1 Toyota and #2 Volkswagen. Known as automotive manufacturers, these two companies are the world’s most important sectors by revenue (MBA Skool, 2018)

HISTORY

Toyota

The Industrial Revolution turned things around within the manufacturing history

for Toyota. Assembly lines were formed during this time period. Japan put a call out for innovators due to they wanted to be able to compete. Afterward, the Second World War

happened which caused weapons to be manufactured. Nonetheless, the U.S. was part

of the Quality Control methods being implemented. Unfortunately, industrial engineers

and statisticians were overlooked because the quality was associated with greater effort

and restrictive regulations (D.B., 2013).

Volkswagen

In 1937, the government of Germany was under the rule of Adolf Hitler. A vehicle came into production called Gesellschaft zur Vorbereitung des Deutschen Volkswagens mbH. Later in the year, the car was renamed Volkswagenwerk. In simpler terms, it meant “The People’s Car.” Volkswagen’s headquarters was located in Wolfsburg, Germany. Hitler’s pet project was the development and mass production of an affordable yet still speedy vehicle that could sell for less than 1,000 Reich marks (about $140 at the time) (History.com Editors, 2018). Called upon by Hitler were people who built cars. Australian Engineer Ferdinand Porsche was Hitler’s choice to build the Volkswagen. In 1939, at a Berlin Motor Show, the Volkswagen was displayed for the first time. When World War II began, the production of the Volkswagen car was halted. Although the factories were in ruins, at the end of the war, the production of the Volkswagen soon began. In the U.S., sales were slower than other parts of the world, due to the car’s historic Nazi connections as well as its small size and unusual round shape (History.com Editors, 2018). Doyle Dane Benback started a campaign referencing the car as the “Beetle”. Throughout the years that followed the Volkswagen became one of the United States top imported cars. 60 percent of the Volkswagen stock was sold to the public in 1960. From 1937 to 1970, the design of the Volkswagen was unchanged. In addition, sales began to fall in 1970. In 1998, the company began selling a new design version of the Beetle. 70 years later, 21 million produced units of the original Beetle was manufactured in Puebla, Mexico on July 30, 2003.

PROFILE

Toyota

Toyota’s goal is to continuously research and develop the highest quality and to improve on their customer’s confidence and fulfillment with their product. This is done by creating the best, fastest and cheapest way possible throughout the world. In addition, they have four essential targets: 1) increase customer satisfaction; 2) keep customer claims at zero; 3) continuously improve the quality of the product, and; 4) keep improving the processes of the operation.

Volkswagen

Volkswagen’s profiles itself as a business that is into selling high quality, reliable cars with spare parts that are safe. Their goal is to be the most innovative vehicle importer in Italy. Client satisfaction is the center of their ideas, accompanied by training. Success relies heavily on achieving corporate and Brand targets.

QUALITY DEFINED

Toyota

A lean production system is what Toyota is known for. Fortune Global 500 ranks Toyota as one of the only companies who addresses TQM. Also, it is the tenth most important company in the world. What is more, they were given very distinguished awards; including the Deming Appreciation Prize in 1965. Also, Japan awarded Toyota with the Quality Control Award in 1970. Customer first is Toyota’s concept. To put the customer first means to continually improve with total participation involving the input of all of its employees. Also, Toyota has a creative suggestion system that supports the encouragement of employees to make contributions to the development of their products. In 1949, Toyota developed Statistical Quality Control (SQC). SQC is when the company gives back with community-based projects and environmental initiatives (D.B., 2013). The concept Toyota has put in place is the core of their operations.

Higher workable quality products and improvement surrounding all of their organizations to individual services is the result.

Volkswagen

Quality is defined through synergy. This is their recipe for success throughout the community. Pioneering mobility concepts for future generations is sought through 1) The basis of mutual trust; 2) being genuine with one another; 3) working together in a straightforward and reliable way; 4) being open-minded with each other; 5) work as equals; 6) making the right choice so they can prevail over one dictated power if rank, position, and origin are not as important; and 7) staying connected in terms of business, friendship and unity (Volkswagen, 2018).

ECONOMY

Toyota

Japan’s economy needed rebuilding. To help reshape the economy, an invitation for statisticians and Quality Managers were called upon. Edward Deming and Malcom Badridge were employed for the task. Toyota was seen as one of the first to employ Quality Control during the 1940s and 1950s. Toyota’s method that is still current today is known as the “lean production”. Edward Deming is credited for the “lean production” term. Lean production is the reference point for Quality Management throughout the world.

Volkswagen

Synergy is the recipe for Volkswagen’s economic success. The core competency for the Volkswagen vehicle will be the battery. By 2025, Volkswagen Group, together with strategic  partners, aims to become a technology leader in automotive traction batteries (Volkswagen, 2018). Importantly, Volkswagen wants their customer to be satisfied.

BUSINESS PROFILE

Toyota

 The Toyota way was established in 2001. It is based on continuous improvement. An effort Toyota strives for is to reduce waste and overproduction. In addition, a bureaucratic system was devised for employee suggestions regarding change if they saw a need for improvement or change. Focusing on long-term improvement instead of short-term is Toyota’s way. In short, putting the customer first and give the customer respect is the goal.

Volkswagen

At the center of the strategic objective will to increase reliable vehicles to customers. Commitment to quality is the future. Volkswagen believes that a good corporate governance is a key condition for sustainably increasing the Company’s value (Volkswagen, 2018). Strengthening the trust of shareholders, customers, employees, business partners, and investors is their work and meeting the steadily increasing demand for information from national and international stakeholders (Volkswagen, 2018).

COMPANY FOCUS

Toyota

 The essence of Toyota’s quality is to acquire customers. Leading to a higher sense of customer satisfaction is sought from each employee. Lean management is the way Toyota implements the activities that shape the corporate culture. Depending on the expertise of the supervisor’s, employee morale, motivation and achievement levels are high. A key cost in  production is lean management. Total participation is what Toyota expects (Total Quality Management, 2010). By doing so, an employee’s momentum is also high. Two of Toyota’s important factors are leadership from the supervisors and allowing employees to communicate openly to all levels of staff.

Volkswagen

Answering transportation needs which gave the people joy was the focus. Volkswagen plans to achieve their focused goal by producing customer need-based automobiles for specific customers. Also, the differentiation of the brand’s territory will be achieved for global profit pools. Europe will be will production occurs. In 2017, Volkswagen brand will be carried over in China. By 2020, the portfolio in the growing SUV segment will initially be expanded by adding 20 models, with the simultaneous development of electrified models (Volkswagen, 2018). In 2025, Volkswagen plans on having 30 electric vehicles in manufactured. The electric vehicle will be sold to specific markets.

Future Success

Although, the Volkswagen has a bag reputation due to the reason and who thought of manufacturing the vehicle, Volkswagen will be more successful than the Toyota in years to come. German engineering is known for their high quality and expert precision vehicles. Also, the Volkswagen has received far more prestigious awards than the Toyota. The bumper-to-bumper warranty’s regarding their VW SUV models are better. What is more, the Volkswagen is a more safer, comfortable, reliable and powerful vehicle.

Bibliography

  • D.B. (2013, April 26). Business Initiative Directions Blog. Toyota Motors: The King of Total Quality Management. Retrieved November 20, 2018, from http://blog.bid-org.com/toyota-motors-the-king-of-total-quality-management/
  • History.com Editors. (2018, August 21). 1937 Volkswagen is founded. HISTORY. Retrieved from https://www.history.com/this-day-in-history/volkswagen-is-founded
  • MBA Skool. (2018). Top 10 Car Brands in the World 2018. Black Friday worth deals are here. Retrieved November 20, 2018, from https://www.mbaskool.com/fun-corner/top-brand-lists/17621-top-10-car-brands-in-the-world-2018.html
  • Stevenson, W. J. (2015). Operations Management (Vol. Twelvth Edition). New York, NY: McGraw-Hill Eduation. Retrieved November 20, 2018
  • Total Quality Management. (2010). Process Improvement Japan & Australia, 3. Retrieved November 20, 2018, from http://www.process-improvement-japan.com/total-quality-management.html
  • Volkswagen. (2018). Corporate Governance. Retrieved November 20, 2018, from https://www.volkswagenag.com/en/InvestorRelations/corporate-governance.html
  • Volkswagen. (2018). Together Strategy 2025. Our strategy – For tomorrow’s growth. Retrieved November 20, 2018, from https://www.volkswagenag.com/en/group/strategy.html
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