Analyzing the Impact of TQM on Oil and Gas Employee Productivity

This report investigates the impact of Total Quality Management (TQM) on employee productivity within the oil and gas industry. It begins with an introduction to TQM, its principles, and the contributions of Deming and Juran. The report outlines the aim and objectives, focusing on identifying quality dimensions (performance, features, reliability, conformance, durability, serviceability, aesthetics, and perceived quality) and performance measurement techniques. Key areas of performance measurement include top management, benchmarking, process management, and quality measurement. The report further discusses the importance of training and empowering employees, as well as quality management related to vendors and customer focus. The conclusion summarizes the findings, highlighting how TQM can improve productivity and overall performance within the oil and gas sector.

IMPACT OF TQM
ON EMPLOYEES
PRODUCTIVITY IN OIL
AND GAS INDUSTRY

Table of Contents
INTRODUCTION...........................................................................................................................1
AIM OF THE REPORT...................................................................................................................2
OBJECTIVE....................................................................................................................................2
Identification of quality dimension of TQM....................................................................................2
Analysis and identification of performance measurement in TQM ................................................4
Top management....................................................................................................................4
Training and empowering of employees................................................................................5
Quality management of vendors.............................................................................................6
Customer focus.......................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Total quality management is defined as a continuous process to detect and reduce errors
in production, streamlining and managing supply chain management. This will helps in
enhancing the satisfaction level of customers so that high profits can be earned. This concept was
given by William Deming who is a management consultant in Japanese manufacturing (Alsaidi,
2014). This assignment is based on different aspects of total quality management and its impact
on the productivity of employees working in gas and oil industry. This report will identify the
quality dimensions in TQM along with performance measurement in TQM. Also, ways to
empower and train employees is discussed. At last, quality management in relation with vendors
and customer involvement is mentioned for oil and gas industry.
Deming's TQM principle for analysis
Concept of Total Quality Management is given by Deming in mid-90's. There are 14
principles in Deming's model of quality management which benefits a company on enhancing
their overall productivity and quality. Some of these principles helps in eliminating those aspects
which do not add value or productivity to an organisation.
 Deming states that to achieve quality constancy is needed. An organisation is needed to
put emphasis in long term planning rather than short term response. Thinking of workers
during production process must be quality oriented. This will help business sector like oil
& gas organisations in earning high productivity and profits.
 According to Deming, a firm is required to cease dependency on inspection to attain
quality. Also, working with a single supplier will benefits a firm in minimising their total
costs. Other than this, numerical goals and values must be removed from production
process so that employees can work without any complexities. By this, companies will be
able to sustain their customer base for a longer time period (Anitha, 2014).
 It is important to have improvement in production processes on continuous basis.
Training and leadership for employees must be instituted. It will help the employees in
working in a confident and efficient manner.
Juran TQM principles
According to Juran, in order to improve business performance and results, an
organisation is required to enhance the quality of their processes, services and products. From
customer's perspective Juran states that a product will be considered as high quality if it has
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multiple features which satisfy the urges of customers in a proper manner. Also, high quality of
product promises few defects due to which overall productivity of company can be enhanced in a
considerable manner. Juran gives three approaches of quality which assists in Total quality
management. These approaches are quality planning, quality control and quality improvement
(Berman, 2014).
AIM OF THE REPORT
Main aim of working on this topic is to acknowledge the impact of Total Quality
Management in gas and oil industry. This aim will help in identifying if improvements in quality
of products produced by Oil and Gas industry will benefits them in earning high revenues and
productivity or not. Gas and Oil industry perform activities like extraction, refining,
transportation, exploration of minerals so that fuels, petroleum, gasoline and other products can
be produced. Due to high versatility in gas and oil industry, other than man power heavy
equipments are also needed (Bon and Mustafa, 2013). Hence, it is important to have proper
design and maintenance of those equipments so that uninterrupted work can be performed. In
this context, management of entire quality in a standardised manner will help oil and gas industry
in getting effective outcomes.
OBJECTIVE
Main objective behind working on this project is “To understands critical quality factors
and measure used in oil and gas industry”. Critical analysis of these quality factors will benefits
associated businesses in identifying which factors of TQM will benefits them in earning high
profits and their goals in an efficient manner. This objective helps in focusing on TQM
approaches and their designs which will assists in increasing overall productivity of company.
Identification of quality dimension of TQM
To manage quality of a product in a proper manner, there are eight quality dimensions
which can be used at a strategic level. This concept is given by David A. Garvin. Out of all the
dimensions, some quality dimensions are reinforcing in nature. These dimensions of quality are
discussed below:
 Performance: It is defined as an operating characteristic for a product. This quality
dimension is measurable in nature. In case of oil and gas sector, performance is
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measured with the help of characteristics like high acceleration, cruising speed, extraction
and refining time, procedures handling etc.
 Features: These are referred as some additional features which helps in enhancing the
appeal of a service or product in the mind of user. In case of petroleum which is a
valuable product offered by gas and oil sector, ease of ignition, burning and realising of
energy defines the quality standards. Petroleum and other oils which are easily burned
contain more sulphur and treated as high quality product (Dixit, and Bhati, 2012).
 Reliability: It is a likelihood that a specific product is going to gain wide popularity and
appreciation within expected time period. Those customers and users which needs a
successful product to use, considers reliability as an main element. If a product is reliable
it is considered as of high quality. In case of oil and gas industry, a product will be
considered as reliable if it do not harm environment and nature in a considerable manner.
 Conformance: This is defined as a degree at which a design and operating characteristics
of a product can fulfil expected standards. An organisation faces failure in conformance
due to high defect rates in their products and incidences of service calls. These measures
results in deviation from expected standards. In case of oil and gas industries, it is the
measurement of uniformity of flood front of injected fluid while oil recovery flooding
operations (Dubey, Gunasekaran and Ali, 2015). By resolving issues of conformance,
production volume of oil and gas can be enhanced considerably without compromising
with quality. This will benefits the concerned company in earning high revenues and
profits.
 Durability: This is another quality dimension that helps in measuring product life. It is
defined as the extent up to which a product can be used before its deterioration. For
example, In context with gas and oil sector, durability of crude oil is less due to which it
is compressed and transformed into petroleum feedstock, lubricating oil, waxes, jet fuel,
heating oil, asphalt etc. which have more durability.
 Serviceability: This quality dimension is linked with courtesy, ease of repair,
competence and speed. After a product is break down, the time taken by a business firm
in offering right services to the customers decides the quality of service. In context with
gas sector, if CNG or LPG manufactured for vehicles is of pungent smell, the time which
is taken by employees of firm in resolving this issue will be considered as serviceability.
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 Aesthetics: It can be treated as a subjective quality dimension. The manner in which a
product smells, feels, taste and sound is a personal judgement. This dimension of high
quality depends upon the perception of people using a service or product. For gas and oil
sector, the manner in which customers perceives the offered product define the quality.
For example, some people consider very light oil like petroleum ether as suitable product
for use but other individuals consider Brent Blend as most useful oil product (Fonseca,
2015).
 Perceived quality: This factor of quality dimension states that consumer do not have
entire information for a service or product. They acknowledge the quality of a product by
comparing it with with products of other brands. For example, if one organisation
operating in oil and gas sector gives low quality crude oil at 100 pounds per litre and
another organisation offer premium quality crude oil at 170 pounds. Customers may
prefer crude oil at 100 pounds if they do not have any idea about quality and they will
consider prices only (Wong, Tseng & Tan, 2014).
Analysis and identification of performance measurement in TQM
Performance management is defined as the procedure of analysing, offering and
collection of information about the performance of an organisation, group, individual etc.
analysing and identifying performance measurement in total quality management helps in
acknowledging those aspects which further needs improvements or modifications (Goetsch and
Davis, 2014). In this respect, performance of top management will be measured in implementing
TQM. Detailed information about this is mentioned below:
Top management
In case of oil and gas industry, top management of an organisation are basically
employees which are holding influential position at workplace. In context with business firms,
top management of a company includes its managers and senior employees. In order to identify
and measure the performance of top management, measurement tools and benchmarking
technique can be used by the business owner of a firm. These aspects are stated below:
Benchmarking of quality
Benchmarking is the procedure to compare cost, productivity, cycle time and quality of a
specific method with another method that is considered as best practice in marketplace. This
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technique will help an organisation in identifying their business performance in respect with rival
firms. There are different type of benchmarking techniques which will help an organisation in
measuring their quality standards like financial benchmarking, process benchmarking,
performance benchmarking, product benchmarking etc. In case of Oil and Gas industries, main
approach to measure quality is product benchmarking in which products offered by a firm is
compared with the product offered by another firm (Mellat-Parast, 2013). This helps the
organisation in identifying those aspects which are lacked in their product. By this, quality can
be improved under TQM. This also helps in increasing knowledge of employees due to which
their working productivity increases in considerable manner.
Process management
In order to attain desired outcomes in effective manner, it is vital for a business firm to
manage their activities and resources in a systematic process. It is attained by acknowledging the
activities that are required to gain specific results along with measuring outputs and inputs of the
process. Also, appropriate management of processes will helps in identifying the risk assessment
results and impact of business operations on the mind set of customers, stakeholders and
suppliers. This will assists the top management in oil and gas industries to clearly identify their
roles and responsibilities. In context with system and process management, main emphasis of
company must be on best design and improved processes so that customers can be fully satisfied
and high revenues can be earned (Mok, Sparks and Kadampully, 2013).
Measurement of quality
There are different methods by which performance measurement in TQM can be
analysed. Some of these aspects are stated below:
Training and empowering of employees
Providing training and development sessions is very important for those organisations
which implement TQM approach in their production and manufacturing processes. This will
helps the workers in improving and increasing their proficiencies to perform work. Efficient
training and improvements in working quality will help a firm in achieving success. Trained
employees will have high learning capabilities and effective knowledge that will offer
sustainable quality management within workplace. Further more learning employees will be able
to adapt quality work and approaches in more readily manner (Oakland, 2014). This will
benefits them in distinguishing from rival organisations due to increased profitability. It is
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because, no organisation can attain high quality due to some experts. All the employees of
company needs to be efficient. By training all workforce working in a gas or oil producing
company, high quality products in accordance with the demands of customers can be produced.
This will also improve the productivity level of employees due to increased motivation and
confidence to perform business activities.
Quality management of vendors
In case of Oil and Gas industry, vendors are the suppliers which offers required
resources, machines and other equipments to business firms so that activities of refining,
extracting and exploring gases and oil can take place in a proper manner. If quality of resources
and materials which are offered by suppliers or vendors in high, it will help the business firm in
performing their activities with greater efficiency. In case of TQM, vendor quality management
involves streamlining and reducing the supplier base so that a good relation can be sustained
with suppliers. Strategic alliance with the suppliers will help Oil and Gas industry in meeting
their expectations without any complexities. Inputs from supplier's side involves first phase of
product production (Parast and Adams, 2012). High quality inputs from supplier will results in
production of premium quality of petrol, diesel, CNG, gasoline etc. Hence, the suppliers which
offer materials and raw resources to Gas and oil production industries needs to adopt TQM too.
Quality management by supplier will helps in delivering high quality machines and raw material
to the factories where activities like extraction, refining, clearing the junk minerals takes place.
This will help the employees of concerned business organisation in completing their tasks in a
timely manner. This will benefits them in became efficient due to which their overall
productivity will enhance (Ross, 2017).
Customer focus
Business organisations depends on their customer base to acknowledge their present and
future requirements. This will benefits them in exceeding their business so that they can earn
high revenues and profits as per their expectations. Organisations which adopts TQM has main
emphasis on serving their external customers in a proper manner. In this context, employees of
such firm are needed to identify the requirements and expectations of their customers. This will
benefits the companies in oil and gas industry to satisfy their customers in efficient manner. By
incorporating successful efforts (appropriate focusing on customers), manufacturing and
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production of products can be managed efficiently. This will motivate the employees in gas and
oil industry to deliver their best performance so that high quality product can be produced. This
increased efficiency of employees to produce standardised product results in increasing overall
productivity of organisation (Raut and et. al., 2018). This assists in the increased productivity of
employees by focusing on the needs of customers in hope to gain high promotions and benefits.
CONCLUSION
From above mentioned report, it can be concluded that with the help of Total Quality
Management, quality of services and products which are offered by company can be improved in
a proper manner. TQM principles given by Juran and Deming helps in analysing the factors
which can helps in increasing the overall productivity of employees. Oil and Gas industry is a
big sector which perform activities extraction, refining and mining of resources. But due to
increased work, efficiency of employees to perform work is low and get resources are wasted.
There are different dimensions of quality in TQM which benefits an organisation in producing
only high quality and standardised products. With the help of performance measurement in
TQM, those aspects which needs prior modifications can be identified. This will helps in
increasing their overall productivity of an organisation including its employees so that high
profitability can be earned within stipulated time-frame.
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REFERENCES
Books and Journals
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companies in Libya. International Journal of Engineering Research and Social
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Anitha, J. (2014). Determinants of employee engagement and their impact on employee
performance. International journal of productivity and performance management.
63(3). 308.
Berman, M. (2014). Productivity in public and nonprofit organizations. Routledge.
Bon, A. T. & Mustafa, E. M., (2013). Impact of total quality management on innovation in
service organizations: Literature review and new conceptual framework. Procedia
Engineering. 53. 516-529.
Dixit, V., & Bhati, M. (2012). A study about employee commitment and its impact on sustained
productivity in Indian auto-component industry. European journal of business and
social sciences. 1(6). 34-51.
Dubey, R., Gunasekaran, A., & Ali, S. S. (2015). Exploring the relationship between leadership,
operational practices, institutional pressures and environmental performance: A
framework for green supply chain. International Journal of Production Economics. 160.
120-132.
Fonseca, L. M. (2015). From Quality Gurus and TQM to ISO 9001: 2015: a review of several
quality paths. International Journal for Quality Research (IJQR). 9(1). 167-180.
Goetsch, D. L. & Davis, S., (2014). Quality management for organizational excellence:
Introduction to total quality.
Mellat-Parast, M., (2013). Quality citizenship, employee involvement, and operational
performance: an empirical investigation. International Journal of Production Research.
51(10), 2805-2820.
Mok, C., Sparks, B. & Kadampully, J., 2013. Service quality management in hospitality, tourism,
and leisure. Routledge.
Oakland, J. S., (2014).Total quality management and operational excellence: text with cases.
Routledge.
Parast, M. M. & Adams, S. G., (2012). Corporate social responsibility, benchmarking, and
organizational performance in the petroleum industry: A quality management
perspective. International Journal of Production Economics. 139(2). 447-458.
Raut, R. & et. al., (2018). An ISM approach for the barrier analysis in implementing sustainable
practices: the Indian oil and gas sector. Benchmarking: An International Journal. 25(4).
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Ross, J. E., (2017). Total quality management: Text, cases, and readings. Routledge.
Wong, W. P., Tseng, M. L., & Tan, K. H. (2014). A business process management capabilities
perspective on organisation performance. Total Quality Management & Business
Excellence. 25(5-6). 602-617.
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