Project Report On FACTORS INFLUENCING CONSUMER BEHAVIOR WHILE BUYING INSURANCE POLICIES Submitted in partial fulfillment of the requirements

for the award of the degree of

Bachelor of Business Administration (BBA) Affiliated To Guru Gobind Singh Delhi Indraprastha University,

Guide Name: Dr. Jyoti (Assistant Professor)

Submitted by: Bhanu Chopra 05790301709

Institute of Innovation in Technology & Management New Delhi 110018 Batch (2009-2012)

Page 1

Certificate
I, Mr. Bhanu Chopra Roll No. 05790301709 certify that the Project Report/Dissertation (BBA310) entitled FACTORS INFLUENCING CONSUMER BEHAVIOR WHILE BUYING INSURANCE POLICIES is done by me and it is an authentic work carried out by me at Institute Of Innovation In Technology And Management. The matter embodied in this project work has not been submitted earlier for the award of any degree or diploma to the best of my knowledge and belief.
Signature of the Student Date:

Certified that the Project Report (BBA-310) entitled FACTORS INFLUENCING CONSUMER BEHAVIOR WHILE BUYING INSURANCE POLICIES done by Mr. Bhanu Chopra , Roll No. 05790301709, is completed under my guidance. Signature of the Guide Date: Name of the Guide: Designation: Address: Institute of Information Technology & Management Countersigned

Director/Project Coordinator

Page 2

Acknowledgement I would like to take this opportunity to express my gratitude towards all the people who have in various ways, helped in the successful completion of my project. I must convey my gratitude to Dr. Jyoti , my project guide for giving me the constant source of inspiration and helping me in preparing the project, personally correcting my work and providing encouragement throughout the project. I would also like to thank all the people who filled my questionnaire and help me in getting the primary data for my project. I also thank all my faculty members for steering me through the tough as well as easy phases of the project in a result oriented manner with concern attention. Last but not the least, I would like to thank my family members who helped me a lot in gathering different information, collecting data and guiding me from time to time in making this project, despite of their busy schedule, they gave me different ideas in making this project unique.

Thanking You, Bhanu Chopra

Page 3

Executive Summary HUMAN RESOURCE

Human resources is a term used to refer to how people are managed by organizations. The field has moved from a traditionally administrative function to a strategic one that recognizes the link between talented and engaged people and organizational success. The field draws upon concepts developed in Industrial/Organizational Psychology and System Theory. Human resources has at least two related interpretations depending on context. The original usage derives from political economy and economics, where it was traditionally called labor, one of four factors of production although this perspective is changing as a function of new and ongoing research into more strategic approaches at national levels. This first usage is used more in terms of 'human resources development', and can go beyond just organizations to the level of nations. The more traditional usage within corporations and businesses refers to the individuals within a firm or agency, and to the portion of the organization that deals with hiring, firing, training, and other personnel issues, typically referred to as 'human resources management'.

Development:-

The objective of human resources development is to foster human resourcefulness through enlightened and cohesive policies in education, training, health and employment at all levels, fromcorporatetonational.

Page 4

Management:-

Human resource management's objective, on the other hand, is to maximize the return on investment from the organization's human capital and minimize financial risk. It is the responsibility of human resource managers in a corporate context to conduct these activities in an effective, legal, fair, and consistent manner. Management is the process of getting things done effectively and effeciently with and through other people to achieve the objective of the organization.

TOTAL QUALITY MANAGEMENT TQM is the way of managing for the future, and is far wider in its application than just assuring product or service quality it is a way of managing people and business processes to ensure complete customer satisfaction at every stage, internally and externally. TQM, combined with effective leadership, results in an organisation doing the right things right, rst time. THE ESSENTIAL COMPONENTS OF TQM COMMITMENT & LEADERSHIP TQM is an approach to improving the competitiveness, effectiveness and exibility of an organization for the benet of all stakeholders. It is a way of planning, organising and understanding each activity, and of removing all the wasted effort

Page 5

and energy that is routinely spent in organisations. It ensures the leaders adopt a strategic overview of quality and focus on prevention not detection of problems. Whilst it must involve everyone, to be successful, it must start at the top with the leaders of the organisation. All senior managers must demonstrate their

seriousness and commitment to quality, and middle managers must, as well as demonstrating their commitment, ensure they communicate the principles, strategies and benets to the people for whom they have responsibility. Only then will the right attitudes spread throughout the organisation. A fundamental requirement is a sound quality policy, supported by plans and facilities to implement it. Leaders must take responsibility for preparing, reviewing and monitoring the policy, plus take part in regular improvements of it and ensure it is understood at all levels of the organisation. Effective leadership starts with the development of a mission statement, followed by a strategy, which Is translated into action plans down through the organisation. These, combined with a TQM approach, should result in a quality organisation, with satised customers and good business results. The 5 requirements for effective leadership are: Developing and publishing corporate beliefs, values and objectives, often as a mission statement

Page 6

 Personal involvement and acting as role models for a culture of total quality Developing clear and effective strategies and supporting plans for achieving the mission and objectives Reviewing and improving the management system Communicating, motivating and supporting people and encouraging effective employee participation

OBJECTIVE OF STUDY:

Page 7

To study the ROLE OF HUMAN RESOURCE in TOTAL QUALITY MANAGEMENT.

SCOPE OF STUDY: To collect and analyze the information regarding Role of HR in TQM.. For this purpose, primary data has been used and is filled by the employees of different companies. Methodology used for data collection: For the purpose of the collection of data, the primary source is used. For this purpose, a questionnaire is designed with the sample size of 20 employees working with different organizations. The Sampling Technique used was Convenience sampling. Tools used: For the purpose of data analysis, tools used were:
Pie chart (or a circle graph) Bar graphs

Results:

Page 8

After conducting the survey of Role of HR in TQM though questionnaire we have come to conclude that The size of the organization of the employees who are surveyed are mostly between More than 1000 and the minimum is 0-50. 60% of the organizations are ISO 9000 certified. 75% of the organizations apply TQM in their organizations. 60%of top level management follows TQM ,and 20 % middle level management follows TQM and only 10 %of all the levels follow TQM in their respective organizations . 80% of the organization provide training program on tqm. And only 70% of the employees are satisfied with those training programs. 25% of the employees says that there organisaton follows quality circle,30 % says their organization follows quality cost analysis.20 % says their organization follows benchmarking 25% of employees says that profit margins difference before and three years after tqm is 5-10 % and 20% says it is more than 15-30 % and 35% says its more than 20 %.

Page 9

Limitations: There were some of the limitations of the project. They are: The sample size was a bit small with the view of 20 employees working with different organizations The location of the outlets visited for the survey was restricted too. Due to lack of expertise in statistical tools and techniques the analysis is done with the help of normal tables, graphs and pie charts. The technique such as standard deviation ,variance are not used. Suggestions and scope for further study : The scope of the study has no limits, thus, our study also have a lot of scope for extension in new geographical areas. The data in the report can be used for further analysis of role of HR in TQM. The datarequired for further study would also be large up to the extent of huge amount of data.proper utilization of graphical presentation would also prove as an effective tool in making the report more attractive and understandable. Time available for preparing the report was insufficient . Due to the lack of time the data collected for the report was insufficient for proper and extensive study or analysis.
Page 10

 Due to lack of expertise in statistical tools and techniques the analysis is done with the help of normal tables, graphs and pie charts.

CONTENTS
S No 1 2 3 4 Certificate (s) Acknowledgements Executive Summary List of Tables Topic Page No -

Page 11

5 6 7 8 9 10 11 12 13

List of Figures List of Symbols List of Abbreviations Chapter-1: Introduction Chapter-2: Methodology & Theoretical Framework Chapter-3: Data Presentation & Analysis Chapter-4: Summary and Conclusions References/Bibliography Appendices

4-44 45-48 49-61

LIST OF TABLES, BARGRAPHS AND PIECHARTS

Table No 1 3 4 5 6

Title Pie chart 1-size of the organization Graph 1: is the organization ISO certified Pie chart 2 :does organization apply TQM Graph 2: whch level of management follows TQM Graph 3: Does your orgaisation provide training program on tqm

Page No 61 62 63 64 65

7 8

Graph 4: are you satisfied with those training programs Pie chart 3: Which other quality practice(s) your organization
are applying for

66 67

Piechart 4:What is the estimated profit margin difference before and 3 years after TQM?

68

Page 12

10

Pie chart 5: What is the estimated customer satisfaction difference before and 3 years after TQM?

69

11

Pie chart 6:What other benefit(s) does your organization gain

with TQM?

71

12

Pie chart 7; What side effect(s) does your organization suffer

with TQM?

72

LIST OF FIGURES

Figure No 1 2 3

Title Human resource Human resource management Steps in TQM

Page No 14 17 26-35

LIST OF ABBREVIATIONS

S No 1 2 3

Abbreviated Name HR TQM No.

Full Name Human resource Total quality management Number

Page 13

Chapter-I

INTRODUCTION Human resources

Human resources is the set of individuals who make capital" up is the workforce of sometimes used

an organization, business

sector or

an economy.

"Human

Page 14

synonymously with human resources, although human capital typically refers to a more narrow view; i.e., the knowledge the individuals embody and can contribute to an organization. Likewise, other terms sometimes used include "manpower", "talent", "labor", and simply "people".

Right person on right place builds an increased value for the position with perfection. Now every company needs quality assurance that have less demand before. HRM is a process to create the individuals and organization together so the objectives of each and every are met. The HR department have to be a proactive, being integral portion of management and strategic planning.

Page 15

Human Resource Management (HRM) is usually a strategy for management that links peoplerelated activities towards the strategy of an enterprise or organization. HRM is frequently termed as strategic HRM. They have several goals:

In order to meet the requirements of the organization and management (in lieu of just serve the interest of employees. To link human resource strategies / policies towards the business goals and objectives; To figure out ways for recruiting to add value to some business;

To help you an enterprise gain the commitment of employees to its values, goals and objectives.

Human resource management

Human resource management (HRM, or human or simply HR) It is is the management of responsible for

an organization's workforce,

resources.

the attraction, selection, training, assessment, andrewarding of employees, while also overseeing organizational leadership and culture, and ensuring compliance with employment and labor laws. In circumstances where employees desire and are legally authorized to hold a collective bargaining agreement, HR will typically also serve as the company's primary liaison with the employees' representatives (usually a labor union).

Page 16

HR is a product of the human relations movement of the early 20th century, when researchers began documenting ways of creating business value through the strategic management of the workforce. The function was initially but dominated by transactional company work such

as payroll and benefits administration,

due

to globalization,

consolidation,

technological advancement, and further research, HR now focuses on strategic initiatives like mergers and acquisitions, talent management, succession planning, industrial and labor relations, and diversity and inclusion.

In startup companies, HR's duties may be performed by a handful of trained professionals or even by non-HR personnel. In larger companies, an entire functional group is typically dedicated to the discipline, with staff specializing in various HR tasks and functional leadership engaging in strategic decision making across the business. To train practitioners for the profession, institutions of higher education, professional associations, and companies themselves have created programs of study dedicated explicitly to the duties of the function. Academic and practitioner organizations likewise seek to engage and further the field of HR, as evidenced by several field-specific publications.

Page 17

Human Resource Management: Nature

Human Resource Management is a process of bringing people and organizations together so that the goals of each are met. The various features of HRM include: It is pervasive in nature as it is present in all enterprises. Its focus is on results rather than on rules. It tries to help employees develop their potential fully.

Page 18

 It encourages employees to give their best to the organization. It is all about people at work, both as individuals and groups. It tries to put people on assigned jobs in order to produce good results. It helps an organization meet its goals in the future by providing for competent and wellmotivated employees. It tries to build and maintain cordial relations between people working at various levels in the organization. It is a multidisciplinary activity, utilizing knowledge and inputs drawn from psychology, economics, etc.

Human Resource Management: Scope

The scope of HRM is very wide: 1. Personnel aspect-This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, layoff and retrenchment, remuneration, incentives, productivity etc. 2. Welfare aspect-It deals with working conditions and amenities such as canteens, creches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc. 3. Industrial relations aspect-This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc

Human Resource Management: Beliefs

Page 19

The Human Resource Management philosophy is based on the following beliefs: Human resource is the most important asset in the organization and can be developed and increased to an unlimited extent. A healthy climate with values of openness, enthusiasm, trust, mutuality and collaboration is essential for developing human resource. HRM can be planned and monitored in ways that are beneficial both to the individuals and the organization. Employees feel committed to their work and the organization, if the organization perpetuates a feeling of belongingness. Employees feel highly motivated if the organization provides for satisfaction of their basic and higher level needs. Employee commitment is increased with the opportunity to discover and use one's capabilities and potential in one's work. It is every manager's responsibility to ensure the development and utilisation of the capabilities of subordinates.

Human Resource Management: Objectives

To help the organization reach its goals. To ensure effective utilization and maximum development of human resources. To ensure respect for human beings. To identify and satisfy the needs of individuals. To ensure reconciliation of individual goals with those of the organization. To achieve and maintain high morale among employees.

Page 20

 To provide the organization with well-trained and well-motivated employees. To increase to the fullest the employee's job satisfaction and self-actualization. To develop and maintain a quality of work life. To be ethically and socially responsive to the needs of society. To develop overall personality of each employee in its multidimensional aspect. To enhance employee's capabilities to perform the present job. To equip the employees with precision and clarity in transaction of business. To inculcate the sense of team spirit, team work and inter-team collaboration.

Human Resource Management: Functions

In order to achieve the above objectives, Human Resource Management undertakes the following activities: 1. Human resource or manpower planning. 2. Recruitment, selection and placement of personnel. 3. Training and development of employees. 4. Appraisal of performance of employees. 5. Taking corrective steps such as transfer from one job to another. 6. Remuneration of employees. 7. Social security and welfare of employees. 8. Setting general and specific management policy for organizational relationship. 9. Collective bargaining, contract negotiation and grievance handling. 10. Staffing the organization. 11. Aiding in the self-development of employees at all levels.

Page 21

12. Developing and maintaining motivation for workers by providing incentives. 13. Reviewing and auditing manpower management in the organization 14. Potential Appraisal. Feedback Counseling. 15. Role Analysis for job occupants. 16. Job Rotation. 17. Quality Circle, Organization development and Quality of Working Life

Human Resource Management: Futuristic Vision

On the basis of the various issues and challenges the following suggestions will be of much help to the philosophy of HRM with regard to its futuristic vision:

1. There should be a properly defined RECRUITMENT POLICY in the organization that should give its focus on professional aspect and merit based selection.

2. In every decision-making process there should be given proper weightage to the aspect that employees are involved wherever possible. It will ultimately lead to sense of TEAM SPIRIT, TEAM-WORK AND INTER-TEAM COLLABORATION.

3. OPPORTUNITY AND COMPREHENSIVE FRAMEWORK should be provided for full expression of employees' talents and manifest potentialities.

Page 22

4. NETWORKING SKILLS of the organizations should be developed internally and externally as well as horizontally and vertically.

5. For performance appraisal of the employees emphasis should be given TO 360 DEGREE feedback which is based on the review by superiors, peers, subordinates as well as self-review.

6. 360 degree feedback will further lead to increased focus on customer services, creating of highly involved workforce, decreased hierarchies, avoiding discrimination and biases and identifying performance threshold.

7. More emphasis should be given TO TOTAL QUALITY MANAGEMENT. TQM will cover all employees at all levels; it will conform to customer's needs and expectations; it will ensure effective utilization of resources and will lead towards continuous improvement in all spheres and activities of the organization.

8. There should be focus ON JOB ROTATION so that vision and knowledge of the employees are broadened as well as potentialities of the employees are increased for future job prospects.

Page 23

9. For proper utilization of manpower in the organization the concept of SIX SIGMA of improving productivity should be intermingled in the HRM strategy.

10. The capacities of the employees should be assessed through potential appraisal for performing new roles and responsibilities. It should not be confined to organizational aspects only but the environmental changes of political, economic and social considerations should also be taken into account.

11. The career of the employees should be planned in such a way that individualizing process and SOCIALIZING PROCESS come together for fusion process and career planning should constitute the part of human resource planning.

CONCLUSION

To conclude Human Resource Management should be linked with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility. All the above futuristic visions coupled with strategic goals and objectives should be based on 3 H's of Heart, Head and Hand i.e., we should feel by Heart, think by Head and implement by Hand.

Page 24

TQM
Everyone has had experiences of poor quality when dealing with business organizations. These experiences might involve an airline that has lost a passengers luggage, a dry cleaner that has left clothes wrinkled or stained, poor course offerings and scheduling at your college, a purchased product that is damaged or broken, or a pizza delivery service that is often late or delivers the wrong order. The experience of poor quality is

exacerbated when employees of the company either are not empowered to correct quality inadequacies or do not seem willing to do so. We have all encountered service employees who do not seem to care. The consequences of such an attitude are lost customers and opportunities for competitors to take advantage of the market need. Successful companies understand the powerful impact customer-dened quality can have on business. For this reason many competitive rms continually increase their quality standards. For example, both the Ford Motor Company and the Honda Motor Company have recently announced that they are making customer satisfaction their number one priority. The slow economy of 2003 impacted sales in the auto industry. Both rms believe that the way to rebound is through improvements in quality, and each has outlined specic changes to their operations. Ford is focusing on tightening

already strict standards in their production process and implementing a quality program called Six-Sigma. Honda, on the other hand, is focused on improving customer-driven product design. Although both rms have been leaders in implementing high quality standards, they believe that customer satisfaction is still what matters most.

Page 25

TOTAL CUSTOMER SATISFACTION... The main objective is of delivering total customer satisfaction. For this purpose most committed people in the industryare required. Total customer satisfaction is achieved through a continuous quality improvement programme, which gets everyone involved in finding new or improved ways of doing things and improving customer service. This process is called Total Quality Management. The result will be a more efficient business and, a better quality of life.

Page 26

"Quality is everyone's business" We all contribute to the success of our business. We all can contribute to making it better.

Page 27

"Quality improvement is a continuous process" The journey on the road to total quality is one of continuous improvment. As we get better, so does our competition.

"We find new ways of doing things." Groups of people are trained and are continuously working to find 'better ways

Page 28

of doing thing'. These are known as Quality Improvement Teams.

"New standards become new ideas" Once we have found new ways of doing things, we incorporate them in our Quality Systems.

Page 29

ISO 9001 was the foundation, now we start to build the house.

"Good communications are essential" We are working together to give total customer satisfaction, so we need to tell each other exactly what we are doing, where we are going and how we plan to get there.

Page 30

"Training for quality" Training course are being carried out that will provide us all with the necessary skills to identify and eliminate waste.

Page 31

 "Progress requires teamwork" Total Quality Management is all about pulling together, combining skill and knowledge.

Page 32

"Total customer satisfaction" Being the best in the business will bring satisfaction, rewards and greater security to all of us.

Page 33

EVERYONE'S HAPPY!

Page 34

Page 35

The Role of HR promoting TQM in an organisation.

TQM is primarily an organizational strategy considered as a change programme to achieve excellence and therefore HR has an important role to play in designing the interventions to prepare the people and the organizations for the desired change.

The role of the HR Department in improving quality can be considerable. Broadly, it can:

Assist in the formulation of the firm's strategic direction and needs. Identify the human resource philosophies or culture consistent with the business needs. Develop and implement policies and activities consistent with the culture. Ensure that the quality improvement process is consistent with the other human resource activities.

The HR department can play a significant role in the change process by establishing a specific programme that is responsible for dealing with the change. This programme can involve:

Establishing a senior HR council and executive operating committee Naming a major initiative that rallies all employees to the change Developing a leadership programme that ensures that the change clearly includes the top management [ a senior management development programme].

Additionally, within the HR department there can be further division of roles and responsibilities. This often involves clarifying the relationship between the corporate-level HR

Page 36

department and the business unit - level departments. Taking a proactive stance, the corporatelevel department can:

Assist senior managers in formulating change Become a model of change Develop and guide divisional human resource departments Change organisational structure Serve as a clearinghouse Serve as trainer for other HR staff Do benchmark analysis Develop HRIS [Human Resource Information System] capacity Audit competencies

Development of Total Quality People: The first pillar of TQM is internal customer satisfaction. People involved in each process have to treat those next in the process as their customer. In addition to the external customer, every activity in the factory has an internal customer. The service to the internal customer is the one which will help gear up the organization to deliver finally the required service to the customer. For example if Marketing dept. deals with external customer, its commitments are to be backed up by other departments for whom the marketing dept. itself becomes a customer. Therefore, all the departments and the people are to be oriented towards achieving total quality and the attitude of " Help us to help you better " must be developed on the philosophy of internal customers. Here lies the importance of HR in developing total quality people i.e. people with positive attitude, values in consonance with organizational mission and change the mindset so

Page 37

that the foundation becomes very strong. The HR effort should be to bring in/foster real spirit of TQM i.e. spirit of reciprocity in interactions and not merely the mechanics of it. The HR initiative in TQM activity should be oriented to demonstrate the

efficacy of Win-Win relationships as contrasted to Win-Lose or Lose-Lose relationships and thereby enabling effective spirit of team work.

Training HR has also to undertake intensive training of personnel in understanding the application of TQM methods & its tools. In Japan, this part of applying TQM methods & tools are very much wide spread & people at all levels starting from top to bottom are very much conversant with this and apply in all spheres of their activity. HR initiatives in this context have to address in training of personnel in becoming "data minded than opinion minded". The mindset of " What is wrong" than " Who is wrong" to be generated & built up. Though it is a formidable task, HR has to trigger this thinking in an organization to realise thought revolution of TQM dimension.

Employee Involvement: Further, HR has to initiate employee involvement in TQM activity. Ultimately, quality is physically produced by the operator on the shop floor. It is therefore very important that he understands the quality requirements of his job. This is possible provided his involvement in the job is very high and he is a very committed and empowered worker. It is in this context that

Page 38

Japanese have introduced Quality Circles which have generated high level of commitment of workers and finally helped Japan to become as world leader in the business. Quality circles are based on the fundamental principles of collaboration,

involvement & empowerment. HR has to facilitate the culture of team work either in the form of Quality Circles, Quality Teams, Task force, CFT, Suggestion schemes or any such others innovative employee involvement schemes for TQM activity. Education and communication: Companies place great emphasis on this, through a variety of vehicles videos, briefing, magazines, newsletters, notice boards, story boards and so on, so as to promulgate and reinforce the quality message. However its inadequate for senior management to express their commitment solely through communicating vision and mission statements.

Recruitment and Selection: TQM has an effect on selection procedures. Some companies have sophisticated recruitment and selection techniques, including psychometric and aptitude tests and assessment centers to identify team workers or problem solvers appropriate to quality culture.

Appraisal: Performance appraisal is seen playing an important role as a tool to communicate to managers whether quality standards are being met, given the importance of the customer evaluation of managerial performance in the overall appraisal.

Page 39

Communication and recognition: Placing so much emphasis on training requires that the company communicate regularly with employees about the developmental opportunities being offered. These are more than just communication vehicles. They serve as a means of worker recognition, which the company takes seriously. Other ways of recognizing employees include:

Recognition DayAn annual celebration at each location in which individual employees and teams are recognized publicly for their accomplishments

Incentive Recognition AwardsAn annual monetary award for excellence above and beyond normal job duties

Seniority Recognition ProgramA program in which every employee receives a card and small gift on the anniversary of his or her date of hire.

Labor relations: One of the distinctive features of human resources program is that the program makes no distinctions between exempt and nonexempt employees. The organization surveys union members about their opinions right along with salaried employees. Union members participate in the employee-suggestion program, and they can attend the Front-Line Leadership Training regardless of whether or not they have any supervisory responsibility.

Job design: Employees are more likely to show commitment when jobs are meaningful and involve significant responsibility and where employees are able to get direct feedback on their

Page 40

performance. TQM emphasis on flexibility and teamwork may also require a move away from detailed fixed job descriptions.

Finally HR has to create TQM mindset by focusing following three main orientations:1) The customer orientation 2) The process orientation 3) The people orientation.

There are five phases of HR intervention for TQM:

Formulation: Hr professional could play a role in shaping TQM initiatives at the formulation stage. They may be able to play a creative role in terms of philosophy behind TQM and its degree of interaction with current organisational practice and ethics. Example: 1. Preparing and synthesizing reports from other organisations that have experience of TQM

Page 41

2. Assisting with choices about TQM approaches. 3. Designing and delivering senior management development courses that create the right climate for TQM.

Implementation Stage: At this stage, HR professionals can play a facilitating role in ensuring the TQM is introduced in most appropriate way. The following activities may be undertaken: 1. Training of middle managers and supervisors in how to develop TQM process within staff 2. Training facilitators mentors and team members in interpersonal skills and how to manage TQM 3. Coaching managers on behaviour 4. Designing communication events to publicize TQM.

Maintenance Stage: Having shaped and implemented the TQM initiative, HR personal function can play an effective part in attempting to maintain and reinforce its position within the organisation. Interventions in the third area are designed to ensure TQM continue to attract a high profile and does not lose impetus. Contribution can be in following areas: 1. Introducing or upgrading the TQM component with induction courses. 2. Ensuring that training in tools, techniques, systems and processes continues to be provided within the organisation.

Page 42

3. assisting quality improvement teams 4. Ensuring the methods of rewarding success are established.

Review Stage: HR may also be able to make contribution to TQM at the review level either on regular basis or part of ongoing procedure for evaluating progress. Such intervention could include: 1. Contributing to leading the preparation of annual TQM reports. 2. Assuring effectiveness of TQM infrastructure 3. Preparing and administrating employee attitude surveys on TQM

Application Stage: Finally and to some extent in conjunction with each of these stages, HR function can apply to TQM to review their own activities along the lines of the undertaken by the internal contractors as analysed earlier. The precise list of practices depends on organisation and function involved. Some of them may be: 1. Preparing offer and contract letters within a specified time. 2. Advising staff on their terms and condition of employment 3. Evaluating Training provision on annual basis. 4. Continual review of its activities using the people related criteria in EFQM model and MBNQA.

Page 43

Implementing total quality management: the role of human resource management. Introduction
Globalization in the business theater is driving companies toward a new view of quality as a necessary tool to compete successfully in worldwide markets. A direct outcome of this new emphasis is the philosophy of total quality management (TQM). In essence, TQM is a companywide perspective that strives for customer satisfaction by seeking zero defects in products and services. Making quality improvements was once thought to be the sole responsibility of specialists (quality engineers, product designers, and process engineers). Today, developing quality across the entire firm can be an important function of the human resource management (HRM) department. A failure on HRM's part to recognize this opportunity and act on it may result in the loss of TQM implementation responsibilities to other departments with less expertise in training and development. The ultimate consequence of this loss is an ineffective piecemealing of the TQM strategy. Thus, HRM should act as the pivotal change agent necessary for the successful implementation of TQM. HRM can act as senior management's tool in implementing TQM in two fundamental ways. First, by modeling the TQM philosophy and principles within its departmental operations, the HR department can serve as a beachhead for the TQM process throughout the company. Second, the HR department, with senior management's support, can take the TQM process company-wide by developing and delivering the long-term training and development necessary for the major

Page 44

organizational culture shift required by TQM. The HR department also has major strengths in terms of recruitment, selection, appraisal, and reward system development to institutionalize a quality-first orientation. An appreciation of the capabilities of HRM to model and institutionalize TQM begins with an understanding of the TQM philosophy. The TQM Philosophy Implementing a total quality management system has become the preferred approach for improving quality and productivity in organizations. TQM, which has been adopted by leading industrial companies, is a participative system empowering all employees to take responsibility for improving quality within the organization. Instead of using traditional bureaucratic rule enforcement, TQM calls for a change in the corporate culture, where the new work climate has the following characteristics:

An open, problem-solving atmosphere; Participatory design making; Trust among all employees (staff, line, workers, managers); A sense of ownership and responsibility for goal achievement and problems solving; and, Self-motivation and self-control by all employees.

The TQM approach involves more than simply meeting traditional rejection rate standards. The end result of TQM is the efficient and effective use of all organizational processes in providing consistent quality at a competitive price. The TQM philosophy is a long-term endeavor that links people and processes in a system that alters the corporate culture to become one where quality is the core aspect of business strategy.

Page 45

In cultivating the TQM philosophy, strategy implementation must involve a focused effort on the part of every employee within the organization. It cannot be applied successfully on a piecemeal basis. TQM requires that management, and eventually every member of the organization, commit to the need for continual improvement in the way work is accomplished. Business plans, strategies, and management actions require continual rethinking in order to develop a culture that reinforces the TQM perspective. The challenge is to develop a robust culture where the idea of quality improvement is not only widely understood across departments, but becomes a fundamental, deep-seated value within each function area as well. HRM as a Role Model for TQM HRM can jumpstart the TQM process by becoming a role model. This means that HRM has two specific tasks: "Serving our customers, and making a significant contribution to running the business." This emphasis on customer oriented service means that the HR department must see other departments in the firm as their customer groups for whom making continuing improvements in service becomes a way of life. In their efforts to achieve total quality management, HRM can demonstrate commitment to TQM principles by soliciting feedback from its internal customer groups on current HR services. HRM should include suggestions from its customers in setting objective performance standards and measures. In other words, there are a number of specific TQM principles that the HR department can model. Applying TQM Principles in HRM. The current emphasis on quality as a competitive strategy has produced many views regarding the actions necessary to achieve it. Leaders in the quality movement (Deming, Juran, Crosby, Feigenbaum)(2)(8)(1)(4) have proposed similar approaches which share certain themes. These themes can be summarized as five basic principles:

Page 46

Focus on customers' needs; Focus on problem prevention, not correction; Make continuous improvements: seek to meet customers' requirements on time, the first time, every time;

Train employees in ways to improve quality; and, Apply the team approach to problem solving.

To institute total quality management as a philosophy within an organization, all employees must come to realize that satisfying customers is essential to the long-run well-being of the firm and their jobs. No longer is the customer-driven focus exclusive to the marketing department. But customer satisfaction can only be achieved after first defining the customer groups. The new perspective here is that all employees exist to serve their customer groups, some internal and some external to the firm. The human resources department has internal customers to satisfy, which indirectly provides ultimate satisfaction to external customers. In addition to identifying customer groups, there are other essential TQM customer issues. Clarifying what products and services will provide maximum customer satisfaction, measuring satisfaction, and continually monitoring and improving the level of customer satisfaction are all fundamental to the TQM philosophy. For the HR department, applying these TQM issues would translate into identifying the expectations of senior management -- their principal internal customer -- regarding TQM, and spearheading the TQM program's implementation on the basis of those expectations. TQM in practice for HRM might also mean periodic surveys, both formal and face-to-face, to monitor senior management's levels of satisfaction as the TQM process unfolds.

Page 47

The TQM approach entails identifying the wants and needs of customer groups and then propelling the entire organization toward fulfilling these needs. A customer's concerns must be taken seriously, and organizations should make certain that its employees are empowered to make decisions that will ensure a high level of customer satisfaction. This can be achieved by promoting an environment of self-initiative and by not creating a quagmire of standard operating procedures and company policies.(7) Flexibility is the key, especially in a business environment that is diverse and constantly changing, as most are today. In modeling these aspects of the TQM process, the HR department would need to identify human resource concerns of other departments and undertake to continually improve its performance, especially in any trouble areas that come to light. Based on this "customer first" orientation, organizational members are constantly seeking to improve products or services. Employees are encouraged to work together across organizational boundaries. Underlying these cooperative efforts are two crucial ideas. One is that the initial contact with the customer is critical and influences all future association with that customer. The other idea is that it is more costly to acquire new customers than to keep the customers you already have.(7) Exemplifying TQM here would mean that the HR department would need to train itself, focusing on being customer-driven toward other departments Quality improvement programs typically involve the directed efforts of quality improvement (QI) teams. Using teams and empowering employees to solve quality-related issues using such tools as statistical process control. (SPC) represent fundamental changes in how many businesses operate. The Focus of SPC, also known as statistical quality control (SQC), is defect prevention as opposed to defect correction. Defect prevention results from continuously monitoring and improving the process. In this context "process" refers to service delivery as well as manufacturing. To ensure that output meets quality specifications, monitoring is performed by

Page 48

periodically inspecting small samples of the product. SPC alone will not ensure quality improvement; rather, it is a tool for monitoring and identifying quality problems. The effective use of quality improvement teams, and the TQM system as a whole, can be reinforced by applying basic principles of motivation. In particular, the recognition of team accomplishments as opposed to those of individuals, and the effective use of goal setting for group efforts, are important in driving the TQM system. The HR department is in a position to help institutionalize team approaches to TQM by designing appraisal and reward systems that focus on team performance. For many companies, the philosophy of TQM represents a major culture shift away from a traditional production-driven atmosphere. In the face of such radical operational makeovers, a determined implementation effort is vital to prevent TQM from becoming simply platitudinal and the team approach just another management fad. Senior management must take the lead in overt support of TQM. Senior Management and TQM To be successful, a TQM system must be wholeheartedly accepted by top management, who, in turn, must convey their commitment to all organizational members.(9) The policy for implementation and maintenance of the TQM system should be set forth in writing and incorporated into the organization's mission and goals statements. The key elements of senior management's role in implementing TQM are: * Institutionalizing the TQM structure as established by stated goals and formal policies and procedures; and * Providing leadership as demonstrated by top management's explicit expectations and behavior in everyday activities.

Page 49

As previously mentioned, it is essential that top management set organizational priorities and goals of the organization. The process of setting goals and allocating authority, responsibility, and resources must be continued throughout every level in the organization. The intent is to have every employee's work support the organizational priorities and to have each person know what to do, in measurable terms, to accomplish the goals. In addition, progress must be monitored regularly, according to agreed upon checkpoints, and employees must be rewarded for attaining specified goals.(5) In summary, top management's responsibilities in the TQM implementation process include: 1. Initiating agreement on goals and measures that cascade throughout the organization; 2. Providing the agreed resources (people, money, training, machines, etc.); 3. Assigning authority and establish deadlines to put resources into motion; 4. Monitoring progress in achieving goals, not to apportion blame, but to aim for improvement; and, 5. Measuring improvement and reward both the achievement of goals and the ways they are achieved.(5) Beyond modeling TQM, the HR department, with senior management's support, can play a leading role in implementing a quality strategy across the firm. The Company-Wide Role of HRM in Instituting a TQM Culture Human resource management can plan a vital role in implementing and maintaining a total quality management process. HR managers are responsible for recruiting high-quality employees, the continual training and development of those employees, and the creation and maintenance of reward systems. Thus, TQM controls processes that are central to achieving the dramatic cultural changes often required for TQM to succeed. Tailoring the TQM cultural

Page 50

development program to the firm's circumstances is essential in overcoming resistance to change and moving beyond simple compliance toward a total commitment to TQM. Holding a major liaison role between top management and employees, HRM has many opportunities to establish communication channels between top management and other members of the organization. Using these channels, HR personnel can ensure that employees know they are the organization's number one priority in implementing TQM. Building trust through an open exchange of ideas can help allay fears regarding the work-role changes that TQM requires. This can provide the foundation for all employees to be trained to consider their peers in other departments as internal customers. Here again, HRM has the opportunity to emphasize this new outlook by example. By exemplifying a customer-first orientation, HRM can help establish a departmental view of service throughout the entire organization. Part of HRM's functional expertise is its ability to monitor and survey employee attitudes. This expertise can be particularly important for a TQM program, since getting off to a good start means having information about current performance. Thus, a preparatory step is to administer an employee survey targeting two primary concerns. One involves identifying troublesome areas in current operations, where improvements in quality can have the most impact on company performance. The other focuses on determining existing employee perceptions and attitudes toward quality as a necessary goal, so that the implementation program itself can be fine-tuned for effectiveness. Obtaining cooperation from other departments in the use of surveys largely depends on their perception of HRM's role in the survey process. The challenge is to establish that HRM is not usurping departmental prerogatives, but is instead a helpful collaborator assisting each department in making their own quality improvements. Emphasizing HRM's collaborator role can be accomplished in the participative spirit of the TQM philosophy by involving other

Page 51

departments in the development of the survey instrument itself. This involvement begins the process of helping each department own the TQM program which will follow. Thus, using a corss-functional TQM survey development team provides an early opportunity for HRM to exemplify the TQM team philosophy and dispel territorial fears about how survey results will be used. TQM and Training and Development. In general, HRM is responsible for providing training and development. With their background, HR departments are well-positioned to take the leading role in providing such programs consistent with the TQM philosophy. HR managers have an important opportunity to communicate a history of their organization's TQM program and its champions. Equally important, HRM can tell stories of employees who are currently inspiring the TQM philosophy. As corporate historian, the HR department should be primarily responsible for relaying the TQM culture to members of the organization in employee orientation training. Beyond communicating the TQM philosophy, the specific training and development needs for making TQM a practical reality must be assessed. Basically HR professionals must decide the following: What knowledge and skills must be taught? How? What performance (behaviors) will be recognized, and how will we reward them? HRM has faced these questions before and can best confront them in the TQM process. Training and development that does not fit within the realm of these questions will more than likely encounter heavy resistance. However, training and development does fall within the realm of these questions probably will be accepted more readily.

Page 52

W. Edwards Deming says TQM plays an important role in the evolution of the institution processes and practice. The Total Quality Management philosophy of management is customeroriented. That is quite similar of pushing the control of policy from bureaucracy and into community in order to empower people rather than simply serve them. All members of the TQM group strive to systematically manage the improvement of the organization through the ongoing participation of all employees/members in problem solving effort accross functional and hierarchical boundaries.

Deming pointed out what he saw as flaws in the traditional model of "management by objectives" which emphasizes a chain of command in which objectives are translated into work standards or quotas. He cautioned that if the performance of the employee is guided and evaluated according to numerical goals. As a result, workers, managers and supervisor get caught up in protecting themselves. Looking good overshadows a concern for the customer or the organization's long term success. Employees, desperate to meet quotas, lose sight of the larger purpose of work. A common example is when sales people are pushed boost business and make promises production can't keep.

With the change in focus, the roles of workers and managers are reformed. A manager's role is to enable employees to do the best job possible foreseeing and eliminating barriers that get in the way. Workers learn to apply the expertise they have gained working with the processes and customers on a daily basis.

Total Quality management, often called TQM, is a mindset and a set of well proven processes for achieving the mindset. The mindset is that everyone in your organization understand what their

Page 53

customer's expectations are and they meet those expectations everytime. Understanding and meeting customer expectations is a challenging proposition and requires processes that support continuing progress toward the goal of meeting customer expectations the first time, everytime.

Successful Total Quality Management requires both behavioural and cultural change. A successful Total Quality Management system brings two other management system together with a behavioural and cultural commitment to customer quality.

Thus Total Quality management becomes a system within itself by default or by choice. There are three management system aligned to meet TQM iniative: a. OM (organizational management system) b. HRM (human resource management system and c. TQM (total management system

Page 54

Chapter-II Methodology and theoretical framework

a) Methodology used for Data Collection Information regarding role of HR in TQM Information regarding Role of HR in TQM are collected primarily through questionnaire in different companies through their employees in Delhi . The sample size consists of 20 employees Information regarding the meaning of Other information regarding the meaning of welfare facilities and its types is obtained from Wikipedia.

i.

Questionnaire

A questionnaire is a research instrument consisting of a series of questions and other prompts for the purpose of gathering information from respondents. .A Questionnaire is an easy to make and a cheap primary source of data to collect information from the users (see appendices).

Page 55

b) Methodology used for Data Analysis Data analysis is done with the help of tables, charts, graphs, diagrams etc. Tools used for analysis are as follows: i. Tables

Used to show the quantitative information that is collected through the questionnaire. Table will show an orderly arrangement of quantitative data in columns and rows. ii. Graphs

Used to represent the role of HR in TQM . In graph an independent variable is represented on the horizontal line (X-axis) and a dependent variable on the vertical line (Y-axis). iii. Pie chart

Used to represent the data collected from the employees graphically. It consists of a circle (disc) divided into several (usually not exceeding six) segments.

c) Theoretical description The description of the concepts, tools and techniques used are as follows; Tables Orderly arrangement of quantitative data in columns and rows. Also called matrix. In statistics, a table (also referred to as cross tabulation or cross tab) is a type of table in a matrix format that displays the frequency distribution of the variables. It is often used to record and analyse the relation between two or more categorical variables

Page 56

Graphs

Graphs are often an excellent way to display results. In fact, most good science fair projects have at least one graph.

For any type of graph:

Generally, we should place our independent variable on the x-axis of our graph and the dependent variable on the y-axis.

Be sure to label the axes of our graph don't forget to include the units of measurement (grams, centimeters, liters, etc.).

If we have more than one set of data, show each series in a different color or symbol and include a legend with clear labels.

Different types of graphs are appropriate for different experiments. These are just a few of the possible types of graphs:

A bar graph might be appropriate for comparing different trials or different experimental groups. It also may be a good choice if our independent variable is not numerical.

Pie Chart

A pie chart (or a circle graph) is a circular chart divided into sectors, illustrating proportion. In a pie chart, the arc length of each sector (and consequently its central angle and area), is proportional to the quantity it represents. When angles are measured with 1 turn as unit then a number of percent is identified with the same number of centiturns. Together, the sectors create a full disk. It is named for its resemblance to a pie which has been sliced. Pie charts work

Page 57

particularly well when the slices represent 25 to 50% of the data, but in general, other plots such as the bar chart or the dot plot, or non-graphical methods such as tables, may be more adapted for representing certain information. It also shows the frequency within certain groups of information.

Chapter- III Data Presentation and Analysis

QUESTIONNAIRE
NAMENAME OF ORGANISATIONDEPARTMENTPOSITIONEMAIL-ID _____________________ _____________________ _____________________ _____________________ _____________________

Ques 1-What is the size of your organization? a) b) c) d) e) 0-50 51-100 101-500 501-1000 More than 1000

Ques 2- Is your organization ISO 9000 certified?

Page 58

a) yes

b) no

Ques 3- Does your organization apply Total quality management?

a) Yes

b) no

Ques 4- which level of management follows TQM?

a) b) c) d)

Top level management Middle level management Lower level management All of the above

Ques 5- Does your organization provide any training program on TQM?

a) Yes

b) no

Ques 6- Are you satisfied with those training programs?

a) Yes

b) no

Ques 7-Which other quality practice(s) your organization are applying for?

a) Quality circle b) Benchmarking c) Quality cost analysis

Page 59

d) Data warehouse e) Just-in-time inventory f) Others,please specify:

Ques 8-What is the estimated profit margin difference before and 3 years after TQM? a) No difference b)0 2% longer than before c)2 -5% than before d)5 10% than before e)10 15% than before f)15 20% than before g)More than 20% Ques 9 - What is the estimated customer satisfaction difference before and 3 years after TQM? a)No difference b)0 5% longer than before c)5 -10% than before d)10 15% than before e)15 20% than before f)20 25% than before g)More than 25%

Ques 10 -What other benefit(s) does your organization gain with TQM?

- Improve Productivity - Improve Morale

Page 60

- Less Paper - Less Waste - Less Rework - Increase Market Share - Clear Roles - New Products Generated - Others

Ques 11- What side effect(s) does your organization suffer with TQM? - Decrease Productivity - Weaken Morale - More Paper - Higher Costs - Higher Staff Turnover - Others

Page 61

 Data Presentation What is the size of your organization?

S. no. 1 2 3 4 5

Size 0-50 51-100 101-500 501-1000 More then 1000

No. of Respondents 1 2 5 5 7

0-50 51-100 101-500 501-1000 More then 1000

Page 62

2. Is your organization ISO 9000 certified? S. No (a) (b) Category Yes No No. of Respondents 12 8

14 12 10 8 6 4 2 0 Yes No No. of Respondants

Page 63

3. Does your organization apply Total quality management?

S. No (a) (b)

Category Yes No

No. of Respondents 15 5

No. of Respondents

Yes No

Page 64

4. Which level of management follows TQM? S. No. 1 2 3 4 Level of Management Top Level Management Middle Level Management Lower Level Management All The Above No. of Respondents 12 4 1 2

12 10 8 No. of Respondents 6 4 2 0 Top Level Mnagement Middle Level Management Lower Level Management All The Above

Page 65

5. Does your organization provide any training program on TQM? S. No (a) (b) Category Yes No No. of Respondents 16 4

16 14 12 10 8 6 4 2 0 Yes No No. of Respondents No. of Respondents

Page 66

6. Are you satisfied with those training programs?

S. No (a) (b)

Category Yes No

No. of Respondents 14 6

14 12 10 8 No. of Respondents 6 4 2 0 No

Page 67

7. Which other quality practice(s) your organization are applying for?

S. no. 1 2 3 4 5

Quality
Quality circle Benchmarking Quality cost analysis Data warehouse Just-in-time inventory

No. of Respondents 5 4 3 6 2

No. of Respondents

Quality Circle Benchmarking Quality Cost Analysis Data warehouse Just-in-time inventory

Page 68

8. What is the estimated profit margin difference before and 3 years after TQM? S. no. 1 2 3 4 5 6 Profit Margin No Difference 0-2% longer then before 2 -5% than before 5 10% than before 15 20% than before More than 20% No. of Respondents 0 1 3 5 4 7

No. of Respondents

No Difference 0-2% longer then before 2-5% then before 5-10% then before 15-20% then before More then 20%

Page 69

9. What is the estimated customer satisfaction difference before and 3 years after TQM?

S. no. 1 2 3 4 5 6

Profit Margin No Difference 0-5% longer then before 5-10% longer then before 10 15% than before 20 25% than before More than 25%

No. of Respondents 0 2 4 4 6 4

No. of Respondents

No Difference 0-5% longer then before 5-10% longer then before 10 15% than before 20 25% than before More than 25%

Page 70

10. What other benefit(s) does your organization gain with TQM? S. no. 1 2 3 4 5 6 7 8 9 Benefits Improve Productivity Improve Morale Less Paper Less Waste Less Rework Increase Market Share Clear Roles New Products Generated Others No. of Respondents 4 2 1 1 4 2 2 2 2

No. of Respondents
Improve Productivity Improve Morale Less Paper Less Waste Less Rework Increase Market Share Clear Roles New Products Generated Others

Page 71

11. What side effect(s) does your organization suffer with TQM? S. no. 1 2 3 4 5 6 Side Effects Decrease Productivity Weaken Morale More Paper Higher Costs Higher Staff Turnover Others No. of Respondents 2 0 5 7 3 3

No. Of Respondents

Decrease Productivity Weaken Morale More Paper Higher Costs

Page 72

Data Analysis
Size of the organisation: 1 employee says that the size of their organisation is 0- 50 employees.2 says that their organisation size is 51- 100 and 7 says that their organisation size is more than 1000 Is your organisation ISO 9000 certified 12 members out of 20 says that their organisation is ISO 9000 certified and 8 says that their organisation is not ISO 9000 certified Does your organisation apply total quality management 15 respondents says yes ,their organisation apply total quality management and only 5 respondents says no to it.,

Page 73

Which level of management follows TQM 12 says that top level management apply tqm in the organisation and 4 says that middle level management apply TQM and only 2 says that all the levels apply TQM in their respective organisation. Does your organisation provide any training program on TQM 16 employees says yes and rest 4 says no.

Page 74

Page 75

Page 76