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A critical review of research on TQM implementation (process and achievements) in light of theories of organizational change Petter Øgland Trial Lecture Oslo, November 27th 2013 Plan for lecture • Introduction (15 minutes) – What is general systems theory (GST)? – What is total quality management (TQM)? – What is organisational development (OD)? • The traditional TQM paradigm (20 minutes) – OD, systems and modernity – Main review of research on TQM implementation • The new TQM paradigm (10 minutes) – OD, complexity and post-modernity General systems theory (von Bertalanffy, 1968; Rosen, 1991) Water circuit Electric circuit Analogy (“similar”) Model (“same”) ( F P / R) ( I V / R) Scientific management and agricultural research Rothamsted Experimental Station, Harpenden, Hertfordshire, 1920s Midvale Steel, Pennsylvania, 1890s Analogy (“similar”) F.W. Taylor Industrial engineering Model (“same”) Statistical method from the viewpoint of quality control (W.A. Shewhart, 1939) R.A. Fisher Statistical methods TQM is company-wide use of statistical process control (SPC) Plan-do-check-act (PDCA): Shewhart (1933), Ishikawa (1985), Deming (1986) Total Quality Management (TQM) as Organisational Development (OD) Problematic social behaviour Improved social behaviour Change Unfreeze Freeze TQM solves the OD problem through industrial engineering (Wren, 2005) Problem structuring methods (PSM) Old situation Analyse Organisational change Model (problem formulation) Design New situation Systems Engineering (SE) Model conclusions (system specification) Implement Evaluation The traditional TQM paradigm (Flood & Jackson, 1991; Flood, 1993) Problem structuring methods (PSM) Old situation Analyse Organisational change Model (problem formulation) HERMENEUTIC KNOWLEDGE Design New situation EMANCIPATORY KNOWLEDGE Implement Systems Engineering (SE) Model conclusions (system specification) TECHNICAL KNOWLEDGE Evaluation Habermas (1971) TQM theory = IE + OD + CT Industrial Engineering (IE) Organisational Development (OD) Critical theory (CT) Methods of doing (Taylor, 1911) Methods of understanding (Lewin, 1947) Methods of emancipation (Marcuse, 1964) OD classification: System of Systems Methodology (Jackson & Keys, 1984) Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) System Dynamics (SD) ? Complex Viable systems methodology (VSM) Selection of OD methods with relevance for TQM based on Flood & Jackson (1991) OD classification: System of Systems Methodology (Jackson & Keys, 1984) Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) System Dynamics (SD) ? Complex Viable systems methodology (VSM) Selection of OD methods with relevance for TQM based on Flood & Jackson (1991) Simple, unitary: TQM & OR Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Complex Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Viable systems methodology (VSM) System Dynamics (SD) ? • Process – Scientific management (Taylor, 1911) • Achievements – Statistical process control (SPC), Pareto analysis, statistical quality control (SQC), mathematical models and methods often described as OR tools • Challenges (Churchman, Ackoff & Arnoff, 1957) – Fails when it does not see the big picture (Churchman, 1968) Complex, unitary: TQM & VSM Systems dimension of context (increasing complexity) Participants dimension of context (increasing diversity of values) Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Simple Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Complex Viable systems methodology (VSM) System Dynamics (SD) ? • Process – Systems analysis (Hara, 1967), BPR (Hammer & Champy, 1993), KM (Davenport & Prusak, 1998), Six Sigma (Harry & Schroeder, 2000) • Achievements – TQC (Feigenbaum, 1961; Juran, 1964; Ishikawa, 1985), Motorola, Xerox, Ford (Camp, 1989), General Electric (Welch, 2001), Chilean government (Beer, 1974) • Challenges – Failure if the system to be controlled is poorly understood (Checkland, 1981) (Beer, 1959) Simple, plural: TQM & SSM Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Complex Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Viable systems methodology (VSM) System Dynamics (SD) ? • Process – Quality circles, workshops, training sessions, HR dept. • Achievements – Fishbone diagrams (Ishikawa, 1987), group dynamics (Lewin, 1950), Tavistock (Trist et al, 1997), STS (Mumford, 1995), SSM (Checkland & Poulter, 2006) • Challenges (Checkland & Poulter, 2006) – Shared understanding of problem and commitment to action does not mean that the problem is objectively understood (Beasley, 2004) Complex, plural: TQM & SD Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Complex Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Viable systems methodology (VSM) System Dynamics (SD) ? • Process – Computer simulation, e.g. DYNAMO (Pugh, 1963) • Achievements – Predictive theory needed for organisational learning (Deming, 1986; Senge 1990), industrial dynamics, urban dynamics, world dynamics (Forrester, 1961; 1969; 1971; Meadows et al, 1972) • Challenges – Behaviour of complex systems are difficult to predict, outcome may be the opposite of what was planned for (Gleick, 1987) (Senge, 1990) Simple, coercive: TQM & CSH Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Complex Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Viable systems methodology (VSM) System Dynamics (SD) ? (Ulrich, 1983) • Process – Assessments, Scandinavian school of IS (Nygaard, 1996) • Achievements – Quality maturity models (Crosby, 1979) – EFQM model (1992) Summary of research: Critical Success Factors (CSF) for TQM implementation • • Management commitment (Beer, 2003; Beckford, 2002; Taylor & Wright, 2003), but difficult to maintain (Schein, 1987) Empowerment (French & Bell, 1995; Gatchalian, 1997) – TQM agents must have statistical education and experience (Deming, 1986), but TQM as a fad resulted in a market populated by consultants without such background (Cole, 1998) • • • • Strategy (customer focus) (Deming, 1986; Taylor & Wright, 2003), but often has to compete for attention with fads, whims and daily fire-fighting (Mintzberg, 1973) Supply-chain management (Deming, 1986; Tapiero, 1996) Internal quality information usage (Taylor & Wright, 2003; Collins, 2003; Hoyle, 2006; Senge, 1990) TQM results must be viewed as a balanced scorecard (Kaplan & Norton, 1996) – Satisfied employees produce better work (Csikszentmihaly, 1990) – Customer focus (Peters & Waterman, 1982), but innovation comes from process not customers (Deming, 1986) – Public image, business ethics, and impact on society is part of quality (Oakland, 1989) – Quality improvement should impact the bottom line (Juran, 1988; Black & Revere, 2006) CSF for TQM implementation forms the basis for the EFQM model In spite of this knowledge, most TQM implementations fail (Burnes, 2010) WHY? Is there another way of looking at TQM implementation? The new TQM paradigm (Dooley, Johnson & Bush, 1995) The organisation is like a mainframe computer OLD METAPHOR The organisation is like a computer network NEW METAPHOR OD classification: System of Systems Methodology (Jackson, 2003) Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) System Dynamics (SD) Actor-Network Theory (ANT) Complex Viable systems methodology (VSM) Complex adaptive systems (CAS) Complex, coercive: TQM & ANT Participants dimension of context (increasing diversity of values) Systems dimension of context (increasing complexity) Simple Complex Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Viable systems methodology (VSM) Complex adaptive systems (CAS) System Dynamics (SD) Actor-Network Theory (ANT) • Process – Ethnography • Achievements – Root Cause Analysis (Ammerman, 1998), Evaluation of the ARAMIS failure (Latour, 1993), “Tragedy of the commons” (Hardin, 1968) • Challenges – Complex explanations motivate passivity rather than action (Winner, 1993) (Legge, 2002) Complex, unitary: TQM & CAS Systems dimension of context (increasing complexity) Participants dimension of context (increasing diversity of values) Unitary (Solve problem) Plural (Formulate problem) Coercive (Evaluate solution) Simple Operation research (OR) Soft Systems Methodology (SSM) Critical System Heuristics (CSH) Complex Viable systems methodology (VSM) Complex adaptive systems (CAS) System Dynamics (SD) Actor-Network Theory (ANT) • Process – Kaizen (Imai, 1987), JIT (Shingo, 1989), Lean Production (Womack et al, 1990) • Achievements – Kanban (Ohno, 1978), 5S (Hiroyuki, 1995), Toyota Motor Company (Liker, 2004) (Axelrod & Cohen, 2000) Does the new TQM paradigm work? • Socially important – The new paradigm creates problems that were not seen within the older paradigm (Kuhn, 1970) – With the new paradigm the world feels like a “juggernaut out of control” (Giddens, 1984) • Scientifically challenging – Unfalsifiable theory (ideological) – Anecdotal empirical evidence – Research based on comparison of treatments is not possible • Relevance for research (Ciborra et al, 2000) – Important and interesting area for doing research Summary of lecture • Introduction – Industrial engineering (IE) and organisational development (OD) are both based on general systems theory (GST) – Total quality management (TQM) is use of IE for doing OD • The traditional TQM paradigm – TQM is GST from the viewpoint of electrical engineering – Mature science, but 80% TQM implementation failure • The new TQM paradigm – TQM is GST from the viewpoint of ecology – Sociologically convincing, but scientifically immature