CHARACTERISTICS OF USING TOTAL QUALITY MANAGEMENT AND ITS INFLUENCES ON COMPANIES’ BUSINESS PERFORMANCES

Total Quality Management (TQM) is still one of the most often used management techniques in practice. From here of very relevant question arises whether the use of TQM can significantly improve a company’s business performances when its current competitive position in the international market is weak. To answer this, first of all the key characteristics of TQM’s effective selection and use were reviewed and then empirical research on TQM’s contribution to a company’s business performances was conducted. The empirical research reveals that those companies applying TQM did not achieve better business results than companies not using it. The reasons lie in the incomplete use of TQM whereby companies neglected the preparing and assessing phases involved. Regarding those companies that use TQM to a similar extent as their competitors from developed economies, their competitiveness is inferior because they primarily focus on quality at the expense of the techniques containing strategic positioning. Besides, later adapters also don’t gain financial benefits from practice. Therefore, management’s selection of techniques should not be based on a random imitation of successful techniques from other environments, but on a profound knowledge of the techniques which include also strategic positioning along with the company’s internal and external environments.