APPLICATION OF TQM TO SERVICE ENVIRONMENTS In

The purpose of this research is to examine the application of the total quality management (TQM) concept to service environments. The service sector of the economy is highly dependent upon the interactions of employees with customers. A high proportion of a service product is created by employees in their interactions with customers. Thus, the effectiveness of the interrelationship between the TQM concept and human resource management (HRM) is critical to the application of the TQM concept by service organizations.

Product quality came to the forefront in the American economy in the late-1980s, as the top managements in American companies learned that American product quality was generally perceived--by Americans and foreign consumers alike--to be inferior to products from other countries--particularly Germany and Japan. Initial emphasis in the American quality reawakening was on manufactured goods. In the service, professional, and construction sectors, American companies were generally competing against other American companies; thus, the pressures to improve product quality were not perceived to be as significant as they were in the manufacturing sector. The advent of the longestduration economic recession in the United States since the 1930s, however, led to changes in the appreciation of quality outside of the manufacturing sector of the economy (Armstrong and Symonds, 1991