Key Points

• Total quality management has been around since the 1950s, helping companies balance cost, speed, and quality.
• The impact of total quality management will only become more relevant in the digital age and with automation.
• There is no question that the iron triangle is one of the most relevant in all modern business.

In the world of total quality management, you have a philosophy that focuses on improving the quality and products of an organization while ensuring that every person inside the organization is on the same page. Not only does this require a chain of continuous work to improve, but it also demands a balance that ensures that cost and quality don’t intersect incorrectly. 

Unsurprisingly, balancing cost, speed, and quality is crucial in the modern business world. Finding this balance can be challenging, but as a member of an organization, by doing so, you are giving yourself the best opportunity to deliver high-quality results and provide customers with better experiences, which means more profit. 

The Iron Triangle

Balancing cost, speed, and quality refers to what has become known as the “iron triangle” of project management. Also known as “triple constraints,” this is another way of referring to the balance of cost, speed, and quality to introduce a high-quality final product, whether this product is physical or otherwise. 

This is essentially a way to describe how the interplay of these three aspects of total quality management comes into play and can be optimized together. In almost every case, all three sides of this triangle must be managed to ensure that one area doesn’t compromise another. 

For example, if a company succeeds in cutting costs, it has to do so without affecting quality. This is a good way to examine why those who believe in total quality management at a corporate level seek to make holistic or global changes instead of those in a vacuum where two departments are not talking. 

The Role of Cost

When you look at the focus on cost in total quality management, it has to reference reducing waste and any efficiencies discovered without any impact on quality. Process optimization is generally a common buzzword in this space, which helps ensure that cost maintains a pivotal role in this balance. 

For example, while investing in employee training might increase short-term costs, it reduces errors and the need to rework specific project steps in the long term. A proactive cost-cutting strategy can also help improve overall competitiveness in the marketplace. 

The challenge is ensuring no organization is cutting corners in a way that affects quality through defective products or unhappy customers. 

The Role of Speed

The role of speed in total quality management is all about streamlining operations to ensure that results are being delivered fast, all while balancing cost and quality. The “Just In Time” or JIT production process is often called up by total quality management professionals who want to ensure that no bottlenecks exist during manufacturing or development. 

One example might be a factory that focuses heavily on total quality management. This factory might reduce its lead times by creating a schedule that aligns with suppliers and production needs. If the two schedules can align, this ensures that deliveries are not sitting for days, which drives up cost and can lead to bottlenecks as organizations rush to get this product off a warehouse floor. 

The challenge here is to ensure that speed is not the only focus of total quality management as it can, unsurprisingly, allow quality to suffer, which means higher costs to make improvements. 

Another example here might be how Toyota implemented automated assembly lines with JIT systems and helped revolutionize how vehicles were manufactured by reducing production time and to this day, maintains some of the highest quality standards around. 

The Role of Quality

Quality is often known as the cornerstone of the total quality management process, as it’s what truly brings about customer loyalty. Six Sigma plays the most prominent role here as organizations look to be consistent across their development and manufacturing processes. 

It won’t surprise anyone familiar with TQM to learn that Quality is the lynchpin of the iron triangle and the backbone of any balancing act that includes cost and speed. Of course, it helps to remember that maintaining steady quality output requires ongoing processes, and it’s not just a one-time thing. 

Companies must examine customer satisfaction scores, and if quality begins to surface as a concern, going back to the drawing board without affecting speed or cost will be considered and reviewed meaningfully. 

How to Balance Cost, Speed, and Quality

Leveraging Data-Driven Decision Making

One of the best and smartest tactics TQM practitioners rely on to help balance cost, speed, and quality is to examine key performance indicators and statistical process control. These will help them explore real-time production variables, including production costs, timing, and even defect rate. 

By examining these metrics, they can determine where trade-offs are being made and whether they can speed up production rates without sacrificing cost or quality. More advanced TQM practitioners will use predictive analytics to anticipate precisely where cost could affect speed, speed could affect quality, and vice versa. 

By using historical data, they can prevent mistakes in the future that would reduce things like delivery timelines or quality coming off a production line. A retailer, for example, could look at predictive shopping models to help adjust their inventory levels so they can deliver goods to customers in a timely fashion. This, in turn, leads to positive customer experiences, which in turn leads to more profits. 

Integrating Lean Principles

If you look at another opportunity to integrate lean principles with total quality management, you’ll immediately be able to focus on targeting things like waste reduction. Unsurprisingly, any effort to eliminate waste can simultaneously improve quality, increase speed, and lower costs. 

One such recommendation in this instance would be value stream mapping, which would allow TQM practitioners to highlight any efficiencies they can easily spot, such as holding onto excess inventory for longer than standard times. This kind of waste needs to be fixed, as holding onto unsold inventory affects profits and might reduce speed as there isn’t enough room in a warehouse to keep new products.

We can also revisit the Just-In-Time principle to ensure that production methods align with demand. This reduces overhead, which reduces costs since unnecessary production doesn’t lead to unsold inventory, which impacts costs. 

Quality will remain a focus here, as an organization will work with suppliers to ensure that what is being delivered meets its quality checks before it can be delivered to customers. The belief here is that by using the Just-In-Time principle, you can focus on eliminating any disruptions that could disrupt cost, speed, and quality. 

Empowering Teams 

Unfortunately, empowering teams often gets overlooked as a way to balance cost, speed, and quality, but it shouldn’t. The hope is that the TQM principle ensures ongoing teamwork between all departments to ensure that the iron triangle is addressed through every step of a production process. 

Every department, from operations to finance to marketing, plays a role here, especially quality assurance teams. Everyone should be held to the same standards to ensure quality, which is the primary focus of this step. 

This said, even a cross-functional meeting can ensure an opportunity to discuss how to cut costs with the appropriate stakeholders in a room. It should go without saying that TQM practitioners would insist on investing in employee training to ensure that all necessary staff can tackle cost, speed, and quality simultaneously and that they can find solutions to any potential challenge. 

Any initial cost outlay necessary to address TQM practices would pay for itself through organizational and sustained improvements to all workflows and manufacturing processes. Having the right teams with the proper empowerment to make changes will ensure the right balance between cost, speed, and quality. 

Customer-Centric Outcomes

Lastly, according to TQM practitioners, ensuring customer-centric outcomes is the final piece of the puzzle to ensuring cost, speed, and quality. Every effort should be made to balance these three initiatives without sacrificing customer needs or reaching a point where a customer determines that the value of something is no longer worth the price. 

For this reason, organizations should have proper channels to collect customer feedback regularly. This could include, but shouldn’t be limited to, surveys, direct conversations with staff, analyzing any complaints that come in from customers, and then taking action based on these complaints.

Other Useful Tools and Concepts

In many different ways, cost, speed, and quality make up the backbone of total quality management. As an approach that has been around since the 1950s and popularized since the 1980s, there is no shortage of companies that have enacted these processes to become more efficient and work toward delivering a better customer experience. 

Unsurprisingly, in the digital age, speed and quality are becoming increasingly important as part of the entire TQM methodology. The hope is that as these technologies become more efficient, so will the ability to predict customer demand and quality issues better and even look at and uncover potential delays to better balance cost, speed, and quality. 

Conclusion 

Finding the balance between speed, cost, and quality in operations will continue to be a work in progress. For this reason, TQM is still a dynamic process that companies worldwide continually refine. It requires a dedicated employee base and the right technology, but if appropriately enacted, it can be a homerun for companies now and into the future. 

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