TQM in Indian Service Sector

TOTAL QUALITY MANAGEMENT

IN
INDIAN SERVICE SECTOR

By – Sharan Chakravarthy M
19PGM45

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TQM in Indian Service Sector

TABLE OF CONTENT

SNO TITLE PAGE

NO
1 INTRODUCTION 3
2 HISTORY OF TQM 5
3 AN OVERVIEW OF SERVICES 7
4 LITERATURE REVIEW OF TQM IN 10
COMMISSION SECTOR

5 CONCLUSIONS 14

6 LIMITATIONS AND FUTURE RESEARCH 15

7 BIBLOGRAPGHY 16

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TQM in Indian Service Sector

ABSTRACT
In an inexorably serious commercial center, business with a solid nonstop improvement culture
and outer center are absolute to endure and thrive. Complete Quality Management (TQM) is
viewed as a major impetus at once. within the current investigation, an effort has been made to
judge the subjective parts of TQM for the administration division associations in India. It was
felt that much are written & implemented about quality management in manufacturing sector.
Also, it's been clearly understandable that the service sector organizations are still thinking about TQM
as a consequence of a general disinteresting the practices and principles. A special emphasis given on
this paper is aimed toward clarifying upon these misunderstandings. Application of TQM principles in
commission sector of India is presently at a really nascent stage and there's a necessity to
form organizations feel its importance by providing them with quantifiable results of
advantages achieved by those organizations which are already on the trail of quality improvement.

Key Words: Total Quality Management, Service Sector, Continuous Improvement,

Standardization, Cost reduction

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TQM in Indian Service Sector

1.INTRODUCTION
Market Globalization, economic growth and its interdependence among on other reshaping the
international and national competitive environment are the main hinderance in adopting to
TQM in many industries. the continual improvement effort must be including an acute
awareness of changes in customer requirements; competitive factors; and broader
variations within the business environment.
In an increasingly competitive marketplace to survive and prosper the business with a
increasing technology is focused more. Total Quality Management (TQM) is taken into
account a very important catalyst during this context. This is why the TQM concept has
captured the commerce and industry in all aspects. TQM is considered to be the boosting
performance in two ways.

• within the short term, superior quality yields increased profitability via premium
pricing. within the long-term, superior or improving quality should end in increased
market share.
• Higher volumes of output result in improved scale economies
that successively should end in lower operating costs. Thus, the investment required to
enhance quality is generally off-set over a comparatively short period of your time.
Thus, we will say quality and customer satisfaction are important subjects receiving
increasing attention worldwide. TQM in commission sector provides a response to the
current awareness and seeks to encourage organizations and firms to manage the
standard aspects of their service activities in an exceedingly more practical manner. In
general, the look of a service involves three elements:

1. The service offered

2. The layout and décor of the power where the service takes place &
3. The service delivery process

In the present study an endeavour has been made to quantify the empirical aspects of TQM for

4
TQM in Indian Service Sector

the service sector organizations in India. it had been felt that much are written & implemented
about quality management in manufacturing sector. Also, it's been already established that
service sector organizations are still hesitant and apprehensive about adopting TQM as a
consequence of a general misunderstanding of its practices and principles. A special emphasis
given on this paper is aimed toward clarifying upon these misunderstandings. Application of
TQM principles in commission sector of India is presently at awfully nascent stage
and there's a necessity to create organizations feel its importance by providing them with
quantifiable results of advantages achieved by those organizations which are already on the
trail of quality improvement.

1.1Research Objectives
Based on the current trend in Indian service sector as TQM is hindering in its way to emerge in the
Indian service platform
1. TQM in ISS as its usage.
2. The extent of advantages realized & side effects by TQM in ISS
3. to get the explanations those motivate organizations to adopt quality systems.
4. to get the factors answerable for inability to start out a
TQM program
5. Comparison of management and customer perceptions
w.r.t the above-mentioned points

Thus, new knowledge associated with TQM in Indian Service sector organizations are often derived.
After reviewing the prevailing TQM literature, it's become very clear that this scientific
research must systematically examine the amount & knowledge of TQM and to investigate the
advantages.

2.History of TQM
An extensive review of literature was meted out to spot the concept of TQM from quality
gurus like Deming (1986), Juran , Crosby (1979),Feigenbaum (1991), and
Ishikawa(1985).[4]

After the approaches to TQM of the five quality gurus are reviewed, it's become evident that
every has his own distinctive approach. Although their approaches to TQM aren't totally the
identical, they are doing share some common points which are summarized as follows:

• it's management’s responsibility to produce commitment, leadership, empowerment,

encouragement, and the suitable support to technical and human processes. it's top
management’s responsibility to determine the environment and framework of operations
within a firm. it's imperative that management foster the participation of the staff in quality
improvement and develops a top quality culture by changing perception and attitudes toward
quality.
• The strategy, policy, and firm-wide evaluation activities are emphasized.

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TQM in Indian Service Sector

• The importance of employee education and training is emphasized in changing employees’

beliefs, behaviour, and attitudes; enhancing employees’ abilities in ending their duties.
• Employees should be recognized and rewarded for his or her quality improvement efforts.
• it's vital to regulate the processes and improve quality system and products design. the
stress is on prevention of product defects, not inspection after the event.
• Quality could be a systematic firm-wide activity from suppliers to customers

2.1NEED FOR TQM IN SERVICE SECTOR

Total quality management (TQM) has acquired a considerable attention in manufacturing

industries. Many success stories are described in magazine articles and at conferences.
However, little has been written on how this management approach has been applied in
commission sector. this is often a significant deficiency, especially because this sector is as
important for its job creation potential & as a GDP contributor.

Growth of service sector is mainly based on the urbanisation and its population to usage ratio
several factors like production specialization, income level and urbanization. These factors are
interrelated. Increase in level of income among the population helps in the growth of service
sector in a more specific path as a result of the increasing specialization of production, firms
tend to outsource many service activities like legal, accounting and security services. it's the
most source of demand for services from the producers.

At the household level, as income rises, consumption of food and

sturdy goods successively becomes saturated over time and demand for services such as
healthcare, travel, communications and finance increases.Furthermore, urbanization
contributes to the expansion of the service sector in two ways. Unlike farmers who to some
extent can provide self-services, urban consumers depend upon the marketplace for the
provision of services. they're also more likely to enter the urban informal sector for
employment if there aren't any job opportunities within the formal sector. In addition, the
participation of girls within the workforce has a bearing on service demand further. More
women within the workforce may lead to a rise in demand for services, starting
from babysitting and catering to tuition and sweetness treatments. Furthermore, regulatory
policies also affect the event of the service sector. an honest example is that the rise of
telecommunications services after deregulation in many countries. This
phenomenon is repeated in other areas like insurance, banking, health care so on. Regulatory
environments may affect international trade and foreign investment in services.

But within the service sector there's a difference between the customer and therefore

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TQM in Indian Service Sector

the organization’s perception about the standard. So, to standardize the processes and to cut
back this gap and also due to inherent complexity of the world there's a good need for TQM in
commission sector. the matter isn't a scarcity of resources; rather, it's that service sector
companies operate below their potential. If managers focused on putting the
prevailing technologies, labour force, and capital stock to figure, rapid productivity growth
would follow. Although the service sector is complex, the managers would had best to use the
identical tools, techniques, and policies that are so effective in manufacturing sector. Doing so
would help them keep their eye on the ball - the efficiency of basic operations. With the
growing maturity of society with relation to education, culture and standards of living, the user
expectations and demands for improved quality of service are increasing. As a part of total
quality management (TQM) companies has to adopt and to be able in sustaining in the market
as a method of driving quality improvement into all their activities.

2.2 Benefits of TQM

Adopting TQM in an industry triggers lot of advantages in the industry which can be a indulged or
practiced effectively in an organisation, many advantages are delivered. it'll strengthen the
organisational business performance and competitive advantage. The successful implementation of
TQM will lead to tangible and intangible benefits and are well acknowledged. a number of the potential
benefits of TQM

1. Reduced cost of operation

2. Improved employee involvement
3. Improved communication
4. Increased productivity
5. Improved quality and less rework
6. Improved customer satisfaction
7. Improved sustainable competitive advantage
8. Promoting continuous improvement and innovation
9. Enhanced customer service and loyalty
10. Improved organisational management
11. Improved employee relations and satisfaction
12. Improved financial performance
13. Improved process and performance management
14. Improved products and services
15. Improved employee morale and reduced errors
16. Increased social responsibility and ethics

3 AN OVERVIEW OF SERVICES
Even when service systems emerged in late 1980’s these four are those worthy – Chase (1978),
Schmenner (1986), Wemmerlov (1990) and Lovelock (1983). Chase (1978) segments by the
extent of customer contact within the delivery of the service. Schmenner (1986) classifies
services with tow dimensions,
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TQM in Indian Service Sector

• Interaction with the customer

• Customisation in matter of degree
.Wemmerlov (1990) more recently presented a service system scheme, where the variables of
differentiation are the degree of routinisation of the method, the ‘object’ of the service process
and customer contact. While Lovelock (1983) has proposed classification of services into four
distinctive categories supported what a service organisation is truly processing and the
way does it perform that task. A service organisation is also servicing individual customer or
alternatively it should be servicing their possessions. Further, the servicing is also physical
as just in case of buying washer, the customer also receives services like installation,
maintenance and repair or visiting a restaurant. Alternatively, the servicing is also intangible
as just in case of education, information, museums, banking or securities

3.1 DEFINITIONS OF SERVICE

Services are defined in many ways but with no general agreement on what really constitute
services. But before drawing attention towards the forms of definitions on
services, it's important to draw distinction on different categories of services. Service will
be divided into four distinct categories (Zeithaml et al., 1996):

• Services as product: Range of intangible product offerings that customers value and pay
money for within the marketplace, e.g. information technology (IT) consulting services
offered by Accenture,
• Customer service: Service provided in support of a company’s core product, e.g.
maintenance of kit,
• Derived service: Value derived from physical goods is that the derived service, e.g.
barbering services,
3.2 SERVICE CHARACTERISTICS

Services nowadays in most of the fashionable products are combination of both tangible and
intangible acts. as an example, take the case of hair dressing at barbershop, the customer will
likely also get pleasure from variety of hair care products and might even purchase some for
home use. When purchasing an cooling, the customer also receives services like installation,
maintenance and repair. to grasp the character and meaning of services, it's important to
grasp the various features of services.

• intangibility
• inconsistency
• inseparability
• inventory

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TQM in Indian Service Sector

3.3 SECTORAL CLASSIFICATION

The usual method adopted by economist to know the relative importance of assorted segments of
an economy is to divide it into three sectors of activity (Zeithaml et al., 1996).
• primary sector (agriculture and mining)
• secondary sector (manufacturing, electricity, gas, installation and construction)
• tertiary sector (services).

This three-sector theory is additionally called because the three-sector hypothesis developed by
Colin Clark and Jean Forestier. in keeping with this hypothesis, the main target of an economy’s
activity shifts from the first sector, through the secondary and so finally to the tertiary sector
(Figure 1) supported the gross domestic product (GDP) output.

3.4 SERVICE SECTOR CLASSIFICATION

Service sector is very wide with its way in existing market as it covers a large variety in the manner of
customer interaction, As it has heterogeneity in character along with varied degree of interaction with
people its har to define service in a single form However, the classification proposed by i-cube,
(information infrastructure for institutions), Centre for Monitoring Indian Economy Private

Industry Services
Hospitality Hotels and restaurant Tourism
industry (hotel
and tourism)
Recreational Production and distribution of films
industry
Media broadcasting
Exhibition of films
Media content
Animation content provider
Other recreational services
Wholesale and Trading
retail trading
Retail trading
Transport Road transport and allied services
services
Railway transport and allied services
Air transport and allied services
Shipping transport and allied services
Transport logistics services
Financial Banking services
services
Investment services
Asset financing services
Other fund-based financial services
Fee-based financial services
Other financial services

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TQM in Indian Service Sector

Communication Telecommunication services

services
Courier services
IT industry Computer software
Information technology enabled services (ITeS)
Other Health services
(miscellaneous)
services
Education
Business consultancy
Storage and distribution
Other miscellaneous services

4 LITERATURE REVIEW OF TQM IN COMMISSION SECTOR

The scope of this section is to review and explore an in-depth literature review on the
problems associated with TQM that specialize in the impact of TQM implementation and its
applicability in several service industries.
After reviewing the voluminous literature, it absolutely was classified into four
categories looking on the importance, nature of literature available and future requirement for
further improvement. The classification categories so chosen are:
• TQM in healthcare
• TQM in banking
• TQM in hospitality (including hotels and tourism).
• TQM in ICT (including telecommunication services, ITeS and computer software
services).

The reasons for selecting the above mentioned four industries are as follows:

• These industries represent the backbone of the Indian economy They share about
56% (more than half) of the service sector’s GDP at factor cost within the country (i3,
CMIE, 2010). Thus, they play an efficient role within the growth and development of
Indian economy yet as within the Indian service sector.
• As per the annual report back to the people of employment published by Ministry of
Labour and Employment (MoL&E), Government of India (GOI), July 2010, the
service sector especially ICT, hospitality, healthcare and financial (including banking
services) are highly labour-intensive industries and provides substantial employment
(MoL&E, GOI, 2010). Hence, they need shown their major presence within the Indian
service sector.
• In keeping with the CMIE, the online annual income generated by these industries is
steadily increasing from last five years except during the world economic slowdown
period of 2008–2009, which shows some decline within the net annual income.
But within the coming years, it's predicted that earnings of those industries will again
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TQM in Indian Service Sector

rise. This shows that these industries play a serious role within the progress and
development of country.
• additionally, these service industries are large enough to capture and
represent most the critical features of customer-perceived quality and also the key
dimensions of excellence that management may encounter
• Finally, these industries reflect the Indian service sector mainly by its wide variability
of Quality Management (QM)/TQM implementation levels.

4.1 TQM IN HEALTHCARE INDUSTRY

One of the important services within the Indian economy has been health. this is often one in
all the most important and most challenging sectors and holds a key to the country’s overall
progress. Currently, the health sector of India accounts for about 1.9% of its GDP. Also, total
public expenditure (both central and state governments) is raised to 1.4% of GDP in 2009–
2010 (Planning Commission Report on Health, Government of India, 2010). Therefore,
during the eleventh five-year plan, while the central government makes every effort to
enhance resources for health, state governments are persuaded to assign a minimum of 7–8%
of state expenditure towards healthcare.

In India, the past few years have witnessed an increasing concern over the standard of
healthcare services. the govt policies have significantly changed the healthcare scenario in
India. Quality has been shown to be a vital element within the consumers’ choice of hospitals.
In light of those changes, there's an emerging must improve the standard of healthcare
services.

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TQM in Indian Service Sector

4.1.1 KEY FINDINGS

• TQM perception is associated with importance of employee’s responsibility and

participation, patient’s satisfaction, responsibility of upper-level management,
measurement and reward system and support of upper-level management
• For the successful implementation of TQM system in a hospital requires hospital
control, developing an incorporated performance measurement system and a broad
approach for quality progress
• The nature of the network relationship and prospector strategy, the two constructs out
of five identified constructs are positively and significantly related to the extent of TQM
adoption
• Provide insights into the relationships among the dimensions such as relationship
between leadership, resource measurement, people management, process management
and customer satisfaction
• Different variables/parameters are linked to progress in TQM and business performance
Positive link between progress in TQM and perceived SQ by customers
• Seven distinct dimensions of patient-perceived TQS highlighted Positive and
significant relationships among the dimensions and patient satisfaction have been found

4.2 TQM IN BANKING SECTOR

The industry is that the largest and progressive industry within the service sector which caters
to the requirements of the various categories of individuals and become a mass consumption
service. Notably, the SQ tends to play a very important role in high involvement
industries the growth of GDP in banking and financial services as per Central Statistical
Organisation (CSO, 2010) and i3, CMIE (2010) is estimated to be 7.09% in 2018,
representing a rise from the extent of growth of 6.7% during 2017, indicating a performance
and infrastructure growth of this sector. in keeping with the survey, Indian banks have
combined network of over 55,000 branches and 20,000 ATMs. This predicts that the Indian
banks are in a very position to accommodate total quality service (TQS) and are at par with
other largest international banks.

4.2.1 KEY FINDINGS

• About 16 CSFs were identified. they're top management support, continuous

improvement, benchmarking, customer focus, recognition and reward, service design,
service technologies, service culture, social responsibility, service caps, quality
department, quality system, human resource management, problem analysis and
strategy.
• No respondents found to agree that their organisations have a well-developed TQM
training strategy and plan About 33ѿ% of respondents have indicated that their
organisations have a well-developed TQM training curriculum

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TQM in Indian Service Sector

• The results showed that successful TQM implementation requires management’s

unwavering commitment to TQM and enthusiasm, formal national bodies to introduce
organisations to TQM and supply assistance during and after TQM implementation,
and a highly educated and competent management team
• The important TQM factors are: top management commitment human resource
management technical and important systems customer focus employee satisfaction
service culture social responsibility services capes
• The findings show that there are perceived gaps in human capital of banks. the
choice ‘employees are satisfied with work performances’ is taken into account to be
important by customers but not by bank personnel. On the opposite hand, banking
personnel believe that their education level is very important, but it's not emphasised
by customers

4.3 TQM IN HOSPITALITY

The World Economic Forum Report (2009) on travel and tourism competitiveness indicates
that India is ranked at 11th place within the Asia Pacific region and 62nd overall. it's ranked
the 14th best tourist destination for its natural resources and 24th for its cultural resources
with variety of world heritage sites (Ministry of Tourism, Government of India, 2010). Beside
this, Indian hospitality industry has contributed more achievements and is being one in every
of the fastest growing industries in terms of sales and interchange earnings. It also helps in the
expansion of other industries indulged to the hospitality. It's a significant contributor to the
national integration process of the country also as preserver of natural and cultural
environment. Studies have further shown that hospitality sector is one in every of the fastest
growing sectors across the planet and constitutes one in every of the essential factors of a
country’s economic process (Holmes, 2007; Politis et al., 2009).

Quality is taken into account to be of great importance within the hospitality industry
especially TQM.Therefore, TQM has received plenty of attention within the tourism and
hospitality journals. TQM approach has been applied to any or all segments of the hospitality
and tourism industry within the literature (e.g. hotels, restaurant, food services, etc.)

4.3.1 KEY FINDINGS

• Identified a range of important components of TQM (such as training/education, etc.)

as they relate to the hospitality and tourism industries.
• Managerial factors are significantly further developed in hotels with a stronger TQM
commitment, which even have higher performances
• Leadership, guest and market focus, and data and analysis emerged because
the three most important TQM factors successfully implemented in these three hotels
Strategic planning emerged collectively of the foremost difficult factors to implements

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TQM in Indian Service Sector

• Business ethics increases the reputation and market competitiveness of an enterprise to

revive trust in business, ethical leadership is more necessary Business ethics prescribes
profit making
• Three levels of quality and environmental commitment are identified.
• Certified hotels develop better the key factors and have better performance

5.CONCLUSIONS

This research paper has presented an enormous array of literature on TQM and its
applicability within the service sector. Beside this, this paper also contributes to the
speculation, definition and benefits of TQM still as extant literature review of TQM in
several service industries. supported the review of relevant literature and also the findings
from the present literature survey, this study demonstrates that TQM has positive impact on
service organisation performance and has been adopted as a useful approach during a number
of foreign still as Indian major service industries, like healthcare, banking, education,
hospitality and ICT, Its and software industry. This paper presents some selected studies on
TQM implementation in several service industries. Further, the result of this research suggests
that TQM is applicable to the service sector and is chargeable for growth and development of
country’s economy. Its implementation is related to better business performance and more
rigorously it's being implemented, the higher the business performance. However, the success
or failure of TQM in commission systems largely depends on the initiatives and enthusiasm of
members constituting the service organisation. The TQM literature suggested that
organisations that want to implement TQM effectively must have patience, because TQM may
be a long-term process and requires major changes in cultural aspects still as employee mindset
in an organisation. Therefore, to create TQM movement successful, a brand-new initiative has
got to be generated across the world and following initiatives have to be taken:
• identify the key areas of service x identify the key practices for successful
implementation of TQM
• commitment by the highest management in implementing TQM for continuous
improvement
• a vision for the change
• customer focus and orientation should be there
• management structure issue
• human resource focus
• environmental focus

This study also helps in better understanding the sectoral classification still as service sector
classification in Indian context as proposed by different organisations and bodies.

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TQM in Indian Service Sector

6. LIMITATIONS AND FUTURE RESEARCH

The understandings state that there are some limitations, which must be considered for
future research. Firstly, the classification of the service categories is somewhat subjective
and supported the certain indices like GDP at factor cost, employment rate, annual income and
importance of customer-perceived quality within the specific industry, which can change from
time to time. additionally, the particular categorisation of service industries was the results
of the judgement of the authors. Although guardianship has been taken by the authors
but there's possibility of omitting the other industry. Secondly, this study was confined only to
service sector consisting of 4 service industries (i.e. healthcare, banking, hospitality and
ICT). it's suggested that future research should cover not only these four service industries but
also industries like education, transportation, realty, recreational services, wholesale and retail
trading, and business consultancy services, where TQM concept can enrich the working style
and organisation performance. Thirdly, during the literature review of TQM in
commission sector, empirical studies addressing different problems with TQM and SQ appear
to be lagging behind, as most of them examined weren't empirical in nature. More conceptual,
case studies and enquiry is required to clarify and validate relationships among theoretical
constructs, which may be integrated into practical managerial frameworks. Fourthly, future
research is named for those areas where no or least work has been taken by the researchers as
found during the literature review. a number of the gaps identified were research on
sustainability development in TQM, total quality environment management, TQM in managed
care organisations, criteria for effective implementation of TQM, identifying and examining
dimensions that drive the applying of multi-dimensionality of TQM from both internal and
external perspective, etc. Fifthly, like many research studies, there's a risk that additional
relevant literature has not been considered or included during this review. Thus, this literature
survey on TQM in commission industries is merely limited to the included research
work utilized in this study. Future studies may take a look at other major TQM areas and
issues, and a broader classification could also be proposed which will include analytical
studies, business excellence frameworks in commission industries, etc. Further, this literature
survey considered to possess made a big contribution towards TQM in commission sector and
proves to be useful as an example of a strategy which may be wont to track the extent of TQM
implementation in commission industry by the researchers and academicians.

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TQM in Indian Service Sector

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