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TOTAL QUALITY MANAGEMENT AND REINVENTING GOVERNMENT

I. What is TQM?

TQM is a new paradigm of management! TQM is both a philosophy and methodology for managing organizations. TQM includes a set of principles, tools, and procedures that provide guidance in the practical affairs of running an organization. TQM involves all members of the organization in controlling and continuously improving how work is done. Government agencies that use TQM agree that it is fundamentally different from traditional management.

II. History of TQM!

TQM Japanese Management?

Yes and No!

The American Walter A. Shewhart of Bell Laboratories developed a system of measuring variance in production systems known as statistical process control (SPC). Statistical process control is one of the major tools that TQM uses to monitor consistency, as well as to diagnose problems in work processes.

His student W. Edwards Deming, a mathematical physicist and U.S Department of Agriculture and Census Bureau research scientist, was hired to teach SPC and quality control to the U.S. Defense industry. These methods were considered so important to the war effort that they were classified as military secrets known as Z1. Ironically, after WWII most U.S. companies stopped using SPC and TQM type quality control procedures.

After WWII U.S. occupation forces in conjunction with the Japanese Union of Scientists and Engineers (JUSE) invited W. Edwards Deming to lecture throughout Japan on SPC and quality control methodology. The Japanese were quick to adapt and modify Deming's techniques. However, even today the highest award in Japan for quality is named after W. Edwards Deming. And one of the highest honors in Japan is to have him present at the ceremony. Deming received one of Japan's highest awards, the Emperor's medal for his contribution to the economic reconstruction of Japan.

Other American's, for example, Joseph M. Juran also stressed to the Japanese the importance of involving all departments in the pursuit of quality and the importance of customer satisfaction, rather simple adherence to technical specifications. Kaoru Ishikawa enlarged the ideas of Juran and Feigenbaum to include as customers, internal customers, those in an organization who depend upon the work output of others. Also, basing his own work in part on the American Behavioral scientists Herbert Maslow (Hierarchy of needs) and Douglas McGregor (Theory Y) he developed the concept of quality circles. TQM today, as practiced in Japan, the U.S. and Europe, is a holistic management philosophy that has evolved over time, and not simply a set of specific techniques like SPC, Quality Circles, and continuous improvement procedures. TQM, if implemented correctly, is a fundamental organizational change.

III. Total Quality Management Today

In the private sector in the U.S. TQM began to have significant impact in about 1985 when major U.S. companies (e.g. Proctor and Gamble and Ford Motor Company, for example) began to work directly with TQM experts like W. Edwards Deming. Government at all levels (Federal, State, and Local) has only recently become involved. Currently, some aspects of TQM are in practice at both the State and Local Level. David K. Carr and Ian D. Littman, Excellence In Government Coopers and Lybrand (1991) report that TQM has been applied in a variety of functional levels at various levels of government in the U.S by 1991.

IV. Philosophy of TQM. The Major Differences Between TQM and Traditional Management (Government and Private Sector). TQM has been characterized as emphasizing the three Cís Customers, Culture and Counting.

. TQM is customer not specialist driven.

Users of products or services define what they want rather than have their needs defined by specialists. In TQM, customer needs and expectations, not agency established standards, define quality. No matter how good your products and services are by some "objective" standard, they cannot have total quality unless they meet your customers needs. A customer is anyone who receives or uses what you produce or whose service satisfaction depends upon your actions. There are two general types of customers in TQM internal and external. An internal customer is someone in your organization whose part in the work process comes after yours. An external customer is the ultimate recipient of your product or service. TQM cannot be implemented unless it is a top down organization. TQM reflects a different paradigm of management. e.g. The chain on the automobile line in Japan versus U.S.

.TQM Builds In Quality vs. Quality Control After the Fact. A Change in Organizational Culture.

Traditional Management in both the product and service arena tolerate errors and waste as long as they do not exceed predetermined standards and specifications. The traditional approach to quality control is inspecting things after they are produced or accomplished. Quality assurance in traditional management systems are typically a system of audits and after the fact inspection procedures usually done by specialists using pre-determined standards of performance as their criteria. Traditional organizations anticipate that there will be errors and devote substantial organizational resources to "planned rework."

TQM focuses on improving the processes (the system) that creates products or services to a point that they are error free and yield minimal scrap or waste of resources. TQM puts quality control and quality assurance back in the line by empowering front line managers and workers.

.TQM Focus on Improving the "System" vs. Holding Employees Responsible for Organizational Failure. A Change in Culture.

One of the major differences between TQM and traditional management is in their respective views of individual versus organizational performance. Deming, in the "red bead experiment," demonstrates the variance explained by the work system versus the individual in total results. TQM does not argue that employees are never late, irresponsible, lazy, or inaccurate. TQM does argue that approximately 85% of the problems in organizations are the result of systems (the way management sets up work to be done) and only 15% the result of problems arise from employee mistakes. The greatest gains in managerial efficiency are in the area of improving work systems, not measuring employee performance.

Systems and Work Processes

Organizations are systems! These systems are composed of a series of processes. An organizational system is a group of related processes. In order for managers to change elements of a system, they need to understand what a process is and how to define problems in operational ways. We will begin with defining the problem we want to solve in measurable terms. We will then introduce selective tools for measuring a work-related process. We will do so in order to produce some form of organizational change. We will employ a five step problem approach. This approach is designed to structure the way you as a manager approach problems. The SPC tools are designed to help you make your case. The focus on CPI is designed to underscore that management is a journey not a destination.

What is a work process?

Work is a series of processes. Problems or challenges usually involve understanding, measuring, and adjusting some element of a work process. Consequently, we will start by defining a work process. For example, the hiring process is a series of linked events that are coupled together to produce an outcome, in this case, hiring someone. Process mapping is using some tool to break down the elements of a process so that we can understand the steps involved in the process, and, how to improve that process. Again, a work system is a group of related (linked) work processes. Dr. W. Edwards Deming is among those management experts who argues that managers need to look to work systems, rather than individual performance, when organizational outputs are below desired levels of quality.

OVERHEAD: A Work Process

What does this very rudimentary map of one common administrative process reveal about a process?

1. It has steps!

We begin the hiring process by preparing a position description and end by drafting and getting approved an "authorization to hire" form.

2. It can be mapped!

The overhead maps the hiring process; like all maps it represents reality in visual fashion.

3. The process outcome will depend upon how well the steps are carried out!

In this case the second step in the process is a review by Personnel. If this review is not completed in a timely manner, all the subsequent steps are affected.

4. You can map or measure any work process and in so doing understand it better!

The assumption here is that if there is a problem in the hiring process, the solution to that problem will be found by improving some step in the process. In other words, if a given step in the process is the source of delays, all steps downstream are affected.

What is a system?

The systems approach is guided by the model from engineering that observes that most physical and social systems can be "modeled" by using the "system" as an analytical device. In management systems, like TQM, work is seen as a series of processes. For example, the hiring process is a series of linked events that are coupled together to produce an outcome, in this case, hiring someone. A system is a series of linked processes, hiring, production, accounting, personnel, etc.

The essential elements of a system are presented below. It is important to see your agency and its work processes as parts of a system. The system concept focuses on the interrelated nature of the parts and the whole. Deming argued that systems speak to managers. The form of the conversation is statistical and is expressed as variance.

Since it is the job of managers to produce work systems, TQM argues that most failures in production or service systems (85%) are failures in the system of work. The way the work is organized by management. Deming illustrates this by using the red bead experiment.

.TQM focuses on increasing employee authority through empowerment rather than enhancing management authority. A Culture Change.

The Traditional American management paradigm drew heavily on the work of Frederick Taylor. Taylor believed that work systems needed to be designed so that jobs could be broken down into a series of simple steps that could be accomplished by persons of the most minimal education and talent. Management was paid to think and front line workers to do. TQM believes that workers are assets to be developed rather than a cost to be controlled. TQM management structures are much different. Typically, you will find "flatter hierarchies". Many staff functions go to workers and first line supervisors. Much emphasis on worker training and retraining. TQM is based on Theory Y . It is team based e.g. self empower work groups and quality circles.

.TQM Focuses on Continuous Improvement Rather than Major Breakthroughs to Produce Quality Improvements. A Culture Change.

Traditional management relies inordinately on technological advances such as automation and computers to produce improved quality and productivity. TQM does not ignore these breakthroughs, but places more value on small, incremental gains resulting from daily attention to enhancing how work is done, called continuous improvement by TQM. Continuous improvement relies on feedback from the customers both internal and external. This feedback is both informal, e.g. stakeholder analysis, and formal, e.g. focus groups and surveys. Because TQM is based on continuous process improvement it requires a long term change in organizational culture which must be accepted by those at the top of the organization.

. TQM believes "In God we Trust," everyone else must provide data! (Counting)

TQMí s counting dimension is predicated on the belief that all organizations are systems and that all systems produce variance. Understanding the source(s) of variance in an organization is managementís most important function. SPC (Statistical Process Control) is the major way measuring and managing variance. The specific tools fishbone charts, pareto charts, flowcharts, histograms, bar-charts, process control charts, scatter plots, are collectively the tools used by the organization to determine if a process is within control limits.

Variance

We frequently talk about averages, average daily usage, average client cost, etc. Each of these "measures of central tendency" (mean, median, mode) of a distribution gives us important information about the data set. However, a summary form of central tendency alone is of limited value since it tells us nothing about the amount of variability among the scores themselves. For example, a young single man new to a neighborhood may be told that in one house down the road there are five women whose average age is 25 years. He strolls over to the house to introduce himself, imagine his surprise, if he discovers that their ages are 50, 5,10, 10, and 50.

There are two distinct sources of variation:

Common cause: Causes that are inherent in the process over time, affect everyone working in the process, and affect all the outcomes in the process.

Special Cause: Causes that are not in the process all the time or do not affect everyone, but arise because of special circumstances.

Again, a process is a sequence of tasks directed at accomplishing a particular outcome. Better processes typically mean better, more desirable events (e.g., more meals delivered than were ordered, fewer errors, etc.). Thinking in terms of processes allows us to focus on customers both internal and external. It allows us to better understand our jobs and the starting and ending points of work under our control. It allows us to identify waste, errors, and other problems.

Recall, if a series of related tasks can be called a process, a group of related processes can be called a system. Both products and services can be regarded as systems that involve interrelated processes. There is a widely held but incorrect belief that if only workers would do their jobs, organizations would have few if any problems. This is a fallacy! As both Dr. Joseph Juran and Dr. W. Edwards Deming have demonstrated, the greatest potential to solve organizational problems (eliminate mistakes and errors) lies in improving systems through which work is done, not in changing workers.

TQM Uses Statistical Process Control Techniques such as Pareto Charting, Flow Charting, Run Charts, Line Charts, etc.

TQM uses these techniques to determine if a process is in or out of control. A flowchart, for example, is a pictorial representation of the steps of a process. Flowcharts show the order and relationship of steps in a process. Flowcharting uses easily recognizable symbols to represent the type of processing performed. As you move down the page of the flow chart, you see a graphic illustration of the activities in the process. The value of this flow chart is that it helps the administrator look for bottlenecks and junctures at which efficiency can be enhanced.

By studying a flow chart, you can uncover loopholes in your logic. Flowcharts can be used to describe the flow of an invoice, materials, or the steps involved in developing a training program. They can be elaborate or very straightforward.

Pareto Chart

Definition

Pareto analysis is the study of related events or subjects to determine if one is more significant than the others!

Use

The Pareto chart is used to identify the most important item in a group of items. A Pareto chart breaks down an item into its component parts and then arranges those parts in order of importance. Pareto analysis is designed to focus the manager's attention on those factors causing the most difficulty first. The idea commonly expressed is that "80 percent of the trouble is caused by 20 percent of the problem."

All of these techniques are applied to allow the managers to systematically measure the work processes under his or her control.
 

V. Why is TQM important to Government in the 1990's.

Forces for Change.

. Public Dissatisfaction.

Only one in every eleven American's think government does a very satisfactory job in producing quality services (Gallup 1988). Proposition 13. The National Debt. Doing more with less is becoming the norm.

. Highly Complex Problems.

Global economy requires public private partnerships e.g. Japan Inc. High Definition TV. Many domestic problems require innovative solutions, i.e., more steering and less rowing by government e.g. managed competition. Competition in the global economy has resulted in a willingness to experiment with new models of organization. Teams, quality circles, flatter hierarchies, and empowered workers are being implemented in an effort to increase organizational productivity and product and service quality.

. Political Climate is conducive to change.

Both Democratic and Republican parties have embraced major elements of TQM. Much of the movement to re-invent government has at its root concepts generic to TQM. Moreover, the concept of more efficient and effective government is non-partisan. Let's turn to the reinventing government movement.

VI. Reinventing Government

"The kind of governments that developed during the industrial era, with their sluggish, centralized bureaucracy, their preoccupation with rules and regulations, and their hierarchical chains of command, no longer work very well" David Osborne and Ted Gaebler, Reinventing Government, 1990.

Reinventing government is a name for a new paradigm for government! Like all new paradigms, it does more than propose change at the margins, it questions basic assumptions about government. It will, therefore, meet with institution resistance. Changing the structural features of government is like trying to change the structural features of higher education, it is inherently difficult.

"Changing Higher Education is similar to trying to move a large cemetery"

Before looking at the paradigm of reinventing government let's look at the forces that shaped contemporary local (county and city) government in the US.

The History of Local Government In the US

The essential features of local government structure in the U.S. are a product of the Progressive Era of American history. Specifically, the Municipal Reform Movement was successful in institutionalizing (in various degrees) through legislative or electoral mandate four essential features.

Non-partisan and at large elections!
Professional Management (Manager Council or Commission form of government)!
Compliance Budget Systems!
Merit Systems!
The motivation for these structural changes was a sound one!!!! It was to break the back of the political machine. The political machine was, according to Edward Banfield and James Q. Wilson, "A political Party organization that depends upon inducements that are both specific and real"

In less prosaic terms, the political machine traded votes for favors. Therefore the city engineer was not necessarily the person who knew most about metal fatigue, but rather, the person who new most about ward politics. In many ways, machine politics and patronage system it engendered was the origin of the pejorative attitudes toward government work that persist to this day.

"Feeding at the public trough"
"Close enough for government work"
"I am from Raleigh and I am here to help you"
The machine was quite open in its view that those who work in government should get something out of it. On Chicago Machine boss said "We are like any sales organization trying to sell our product. Or as George Washington Plunkitt of New York's Tammany Hall, who in fact became a millionaire during a "public service career, said to understand government you needed to understand human nature.

The essential position of reinventing government is not that government can be run like a business. Business is in the business of efficiency. Government must be concerned with both EFFICIENCY and EQUITY and those two objectives require tradeoffs that business is not expected to make.

Reinventing government is saying, however, that government (and particularly local government) must seek EFFICIENCY by being more RESULTS than COMPLIANCE driven. We need to shift our paradigm from compliance to public entrepreneurship. We do not give up ACCOUNTABILITY we seek to measure it in ways other than simple compliance with rules.

THE TEN PREMISES

1. Government must do more steering than rowing. Government comes from a Greek word meaning to Steer.

Local government currently is perceived as an institution that collects taxes and provides services. Delivering services is rowing, steering is identifying problems and facilitating community solutions. Note: prior to the New Deal many services were provided by religious and civic groups. We may need to return to this format.

Examples. Day care, etc.

2. Community Owned Government: Empowering Rather than Serving

(Community Policing vs. Traditional Policing) Community policing is a philosophy of full service personalized policing, where the same officer patrols and works in the same area on a permanent basis, from a decentralized place, working proactive partnership with citizens to identify and solve PROBLEMS. Traditional policing views itself as FIGHTING CRIME, the strategy of mobile patrol, performance standards based on incidents, and impersonality.... flow directly from the objective of fighting crime. Solving community problems, decaying neighborhoods, public drunkenness, child abuse require the community police officer to do much more than fight crime.

SRO (School Resource Officer). A community policing officer assigned to a school for a minimum of three years, who is law enforcement officer, counselor, and teacher. Using technology: voice mail, mobile computers, etc and their networking into the school community to makes schools safe. SRO's are a new paradigm...... like the DARE officer was in the 1970"s.

3. Competitive Government; Injecting Competition into Government

One Faced and Two Faced organizations.
Managed Competition
4. Mission-Driven Not Rule Driven Organizations

Mission Driven Budget Systems
Mission Driven Personnel systems

5. Results Oriented Government: Funding Outputs and Outcomes not Inputs.

Chain of outputs
Less concern with Process measures
6. Customer Driven Government: Meeting the Needs of the Customer not the bureaucracy. Since most agencies don't get their money directly from the customer they sometimes lose sight of them. Example used in goal displacement, the library that stays open 8 to 5 pm five days a week because it's best for the employees. 7. Enterprising Government: Earning Rather than Simply Spending. Examples of government as entrepreneur. Government making a profit? 8. Anticipatory Government: Prevention Rather Than A Cure, Strategic Planning
Anticipatory Policy
Example: Recycling
9. Decentralized Government: From Hierarchy to Participation Empowering workers: U.S. vs. Japanese auto workers
pulling the chain.
Quality Circles
Team management
Employee development programs
Invention and Patent policies
New Reward Systems
10. Market Oriented Government: Leveraging Change through the market. What makes the market work?
Supply
Demand
Accessibility
Information
Major Differences Between Reinventing Government and Traditional Government Management.

. Reinventing Requires a Full Management Commitment!

RIG like TQM requires a change in organizational culture that can only come from the top, CEO down. Why? It requires changes in the structure of local government. If you are going to add quality circles, statistical process control, without a change in managerial philosophy this will lead to less than optimal results, if not outright failure. RIG's philosophical principles make a variety of assumptions that have implications for managerial practice, for example: hierarchy: flatter, managerial responsibility: the system rather than the worker is generally responsible for lack of quality: the role of expertise: the customer is king in and reward systems: gainsharing is more preferred than merit pay. This type of large scale change in organizational culture must have top down commitment. Quality is free, but there is a cash flow problem.

. Heavy Use of Process Control Measurements!

In God we trust, all everyone else must present data! RIG must be based on "data" not "opinion"! Measurement techniques called statistical process control techniques that measure aspects of work systems are employed. RIG is like TQM in that both envision all work processes as systems. Process in TQM is a series of operations linked together to provide some result that has increased value (value added). The goal of RIG and TQM is continuous process improvement. Many processes in government are product oriented... many are not. True, statistical process control was developed to monitor quality on the shop floor, however, administrative functions such as contracts and personnel are also measurable processes.

Inputs ---> Transformation  ---> Immediate Outputs  ---> Intermediate Outputs ---> Ultimate Outputs

-------------------------------------------- FEEDBACK-----------------------------------------------

. Establishing Distinctions between Input, Output, and Outcomes and taking the longer view.

Edwards Deming observed that you need to change systems if you want a change in quality to occur. Government needs to focus on the outcome first, the outputs that will lead to that outcome second, and the processes of administration last. Currently it is the other way around.

Conclusion

Real change in government (and in life) is usually preceded by necessity. Necessity is not only the mother of invention, it is the mother of change as well. The "do more with less" era requires that government seek to change structures that promote inefficiencies. It is, in my view, no coincidence that many of the examples in Reinventing Government and one of the authors, is from California. Prop 13 is the mother of much innovation in the state.


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Table of contents
Total Quality Management
and Reinventing Government
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An introduction to QM
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Committee:TQM Information
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