According to P. F. Drucker, the management philosophy
known as Total Quality Management (TQM), which is
designed to be adopted consistently throughout an
organization and to improve customer service by using
5) sampling theory to reduce the variability of a product's quality,
can work successfully in conjunction with two older
management systems. As Drucker notes, TQM's scientific
approach is consistent with the statistical sampling techniques
of the "rationalist" school of scientific management, and the
10) organizational structure associated with TQM is consistent with
the social and psychological emphases of the "human
relations" school of management.
However, TQM cannot simply be grafted onto these
systems or onto certain other non-TQM management
15) systems. Although, as Drucker contends, TQM shares with
such systems the ultimate objective of increasing profitability,
TQM requires fundamentally different strategies. While the
other management systems referred to use upper
management decision-making and employee specialization to
20) maximize shareholder profits over the short term, TQM
envisions the interests of employees, shareholders, and
customers as convergent. For example, lower prices not only
benefit consumers but also enhance an organization's
competitive edge and ensure its continuance, thus benefiting
25) employees and owners. TQM's emphasis on shared interests
is reflected in the decentralized decision-making, integrated
production activity, and lateral structure of organizations that
achieve the benefits of TQM.