Effect of TQM in Banking Industry
Introduction
Banks play significant role in the economic system because they are financial intermediaries which involve the transfers of funds in and outside the country. The services offered by the banks include the quality, speed, efficiency, and innovation which make the delivery of services and products unique from other bank competitors. In considering the quality of the services in the banks, the strategic management and total quality management are considered that distinguishes the ideal quality of the banks.
Background and Problem Statement
In the action of the banks in paying attention to their quality services, there is a significant effect of the total quality management or TQM in terms of the competition. But there is no doubt that the foreign banks can be ahead of the competition because of various factors. From the technological aspects of the foreign banks, there can be certain advantages that can be gained. However, through the use of the TQM, it is identified that there will be systematic methods, like in data collecting and credit risk management, that will implement a more quality-centered services in terms of banking operation (Naeem, Saif, & Qasim, 2008). Since the banking sector is getting competitive every time, the TQM is proposed to increase the successful rate of the business by taking the integral part of the strategic management. However, what would be the effects of the TQM in the banking businesses?
Research Aim and Objectives
The aim of the study is to investigate the effectiveness of TQM in the banking industry, particularly in Tanzania. In order to achieve this aim, there are four objectives that should be considered. First is to recognize the existing strategic management being employed in banks. Second is to identify the strengths and weaknesses of the strategy that banks employ in their system. Third is to study the TQM implementation on different commercial banks in Tanzania. And fourth is to develop and propose a quality model of TQM for the banking services.
Literature Review
In the competitive environment of banking industry, the quality implementation of a strategy is indeed necessary. Of all the types of banks in Tanzania, the commercial banks are identified to be the most type of institution that is engaged with the complexities. The operation of such banks may indicate the introduction of TQM as one of the highlights in banking operations (Naeem, Saif, & Qasim, 2008). TQM, as a total organizational approach is made to meet the customer needs and expectations. This kind of approach includes both manager and employees to continuous improve the organization’s processes, products and services. With the help of TQM, the organization is associated with the creation of such system between the people and products and/or services. Therefore, in order to improve the organizational competitiveness and effectiveness, it is proposed that TQM is a great foundation on an organization’s system. In addition, the TQM invites and targets the management and techniques together with the organizational concepts and principles. If the kind of strategy is implemented in the banking organization, the services can be fashioned and are expects to lecture more advantages in the competition. The quality improvement is not the specialization of TQM but it can deliberately make an impact towards the work and responsibilities of the employees and managers to create the improvement needed in their industry. To improve the financial sector and the entire economy, the banks and their methods should also the address the problems in the society, in which the TQM can be applicable (Psychogios & Priporas, 2007).
Methodology
The suggested method in the study is the use of the secondary information and interview, which is more appropriate if the study, is conducted in different commercial banks of Tanzania. In order to achieve the study level of TQM, it is better if the researcher/s is oriented regarding the implementation of TQM in a certain bank. Then, the researcher will develop an interview guide and conduct a scheduled interview among the five members of the bank. The participants can be the executives, bank manager or supervisors, senior managers, and employees. It is advised that the said participants are included in the interview. The data collected will be presented in an organized manner, such as the use of tables, which indicates the bank name and the level of TQM implementation. The researcher/s can thereby analyze all the collected information and determine its effectiveness in the banking businesses. At the end, the study can generate a comprehensive model for the quality implementation of TQM.
References:
Naeem, H., Saif, M.I., & Qasim, S., (2008) Total Quality Management – A Recommended Strategy for The Pakistani Banking Sector, International Business & Economics Research Journal, 7(11) [Online] Available at: http://cluteinstitute-onlinejournals.com/PDFs/912.pdf [Accessed 09 Aug 2010].
Psychogios, A.G., & Priporas, C-V., (2007) Understanding Total Quality Management in Context: Qualitative Research on Managers’ Awareness of TQM Aspects in the Greek Service Industry, The Qualitative Report, 12(1) [Online] Available at: http://www.nova.edu/ssss/QR/QR12-1/psychogios.pdf [Accessed 09 Aug 2010].
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