Creating Superior Operational Performance Through Total Quality Management Practices at Manufacturing Companies in Surabaya, Indonesia

Abstract

The aim of this study was to empirically investigate the effect of critical TQM practices on operational performance of medium and large manufacturing companies in Surabaya. The critical total quality management (TQM) practices divided into three factors, i.e. strategic, tactical, and operational factors as predictors of operational performance. Total of population were 236 manufacturing companies. A questionnaire designed and distributed to all population, a total of 118 returned. It consists of both 58 medium companies and 60 large companies. Data analysis use both descriptive and multiple regression analysis. Data is analyzed by IBM SPSS 21. The empirical analysis demonstrates several key findings: data analysis shows that there was a positive effect of critical TQM practices which consists of strategic, tactical, and operational factors on operational performance. Tactical factors were the strongest significant predictors of operational performance. Overall, the results showed the central role of the tactical factors as critical factors in improving the operational performance within medium and large companies. There were some research limitations. For instance, the study is using perceptual data provided by production managers or quality managers which may not provide clear measures of performance.

Keywords: critical TQM practices, operational performance, manufacturing companies