TQM & Rising Health Care Costs
INTRODUCTION 1
AN OV
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The emerging crisis in the health care industry demands that hospital administrators explore innovative management tools such as total quality management (TQM). Rising health care costs have made quality medical treatment inaccessible to a significant segment of the American public. Hospitals are faced with intense pressures to contain costs and improve service. A shortage of nurses and medical technicians as well as a startling number of hospital closures throughout the country have contributed to shrinking health care resources. In addition, hospitals face unprecedented competition from alternative types of health care facilities. Increasingly, contemporary hospitals are meeting the external challenges of the marketplace by adopting TQM programs. TQM has been endorsed by the Joint Commission on Accreditation of Healthcare Organizations. Although the philosophy of TQM was developed for manufacturing firms, the basic principles of TQM can be modified to fit the needs of the health care industry. The Contribution of W. Edwards Deming TQM was developed by a number of American consultants, but the name most frequently associated with the concept is statistician W. Edwards Deming. While few American companies became early converts to TQM, the Japanese embraced the philosophy and methodology enthusiastically, and elevated Deming to the status of a national hero. The Japanese credit TQM with helping them to rebuild their postwar economy. After
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wa Hewlett-Packard's TQM program was credited with reducing its defect rate in its soldering process from 4,000 parts per million to 3 parts per million. In addition, employee productivity rose 91 percent, costs fell 42 percent, and profits rose 177 percent. Xerox's TQM program, introduced in 1983, was aimed at improving the quality of products from its suppliers. By 1992, the rate of defects received from suppliers fell from 25,000 parts per million, when the TQM program started, to under 300 per million.
The TQM philosophy dictates that even companies that have achieved spectacular improvements in quality cannot afford to rest on their laurels. TQM stresses continuous improvement. What is important is the change in performance over time: "[A company] should measure its achievement of TQM goals based on how far it has moved in the appropriate direction, rather than where it is at a single point in time."
TQM Training and Development
To ensure success, TQM must be a company-wide philosophy. The success of TQM is unlikely unless everyone in the company embraces the concept. TQM emphasizes the team approach. Teams, not individuals, are responsible for overall performance. Management influence is an essential compo
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Approximate Word count = 4344
Approximate Pages = 17 (250 words per page)
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