SUSTAINABLE TQM IMPLEMENTATION IN RELATIONSHIP WITH CUSTOMER SATISFACTION AND BUSINESS PERFORMANCE
IN INDONESIAN REMANUFACTURING COMPANY
By Bayu Cahyono
21952036
MASTER’S DEGREE in
MASTER OF MECHANICAL ENGINEERING – ENGINEERING MANAGEMENT
FACULTY OF ENGINEERING AND INFORMATION TECHNOLOGY
SWISS GERMAN UNIVERSITY The Prominence Tower
Jalan Jalur Sutera Barat No. 15, Alam Sutera Tangerang, Banten 15143 - Indonesia
February 2021
Revision after thesis defense on 2 February 2021
Bayu Cahyono STATEMENT BY THE AUTHOR
I hereby declare that this submission is my own work and to the best of my knowledge, it contains no material previously published or written by another person, nor material which to a substantial extent has been accepted for the award of any other degree or diploma at any educational institution, except where due acknowledgement is made in the thesis.
Bayu Cahyono
_____________________________________________
Student Date
Approved by:
Dr. Eng. Sumarsono, S.T., M.T.
_________________________________________ ____
Thesis Advisor Date
Dena Hendriana, B.Sc., M.Sc., Ph. D.
_____________________________________________
Thesis Co-Advisor Date
Dr. Maulahikmah Galinium, S.Kom., M.Sc.
_____________________________________________
Dean Date
Bayu Cahyono ABSTRACT
SUSTAINABLE TQM IMPLEMENTATION IN RELATIONSHIP WITH CUSTOMER SATISFACTION AND BUSINESS PERFORMANCE
IN INDONESIAN REMANUFACTURING COMPANY By
Bayu Cahyono
Dr. Eng. Sumarsono, S.T., M.T., Advisor Dena Hendriana, B.Sc., M.Sc., Ph. D., Co-Advisor
SWISS GERMAN UNIVERSITY
The implementation of Total Quality Management (TQM) emphasizes two important aspects of daily management and policy management that must be ensured in line with customer satisfaction and business performance. To address this issue, the researchers focused on the effectiveness of TQM implementation by conducting internal management diagnosis and conducting customer satisfaction surveys. The main objective of this research is to see the relationship between the effectiveness of TQM implementation and its impact on customer satisfaction and business performance using the Quality Function Deployment (QFD) method. It was found that the implementation of TQM had a positive impact on customer satisfaction and business performance and the correlation could be seen in the effectiveness of daily management and policy management using the QFD method. The implementation of TQM focuses on the aspects of daily management and policy management where an internal diagnosis is needed by management as feedback loop for evaluating so that a sustainable TQM implementation is achieved. The QFD method can be used as an approach to ensure the correlation between daily management and policy management which is carried out in line with the results of the customer satisfaction survey and business performance for the effectiveness of the necessary improvements.
Keywords: Total Quality Management (TQM), Quality Function Deployment, Customer Satisfaction, Business Performance.
Bayu Cahyono
© Copyright 2021 by Bayu Cahyono All rights reserved
Bayu Cahyono DEDICATION
I dedicated this research for My Beloved Family, PT Universal Tekno Reksajaya and PT United Tractors Tbk
Bayu Cahyono ACKNOWLEDGEMENTS
I Would like to thank to Dr. Eng. Sumarsono, S.T., M.T. and Dena Hendriana, B.Sc., S.M., Sc.D and all Lecturers who have guided me while studying in Swiss German University. And also to Mr. Edhie Sarwono who gave me the opportunity to take a master's degree.
Bayu Cahyono TABLE OF CONTENTS
Page
STATEMENT BY THE AUTHOR ... 2
ABSTRACT... 3
DEDICATION ... 5
ACKNOWLEDGEMEN TS ... 6
TABLE OF CONTENTS ... 7
LIST OF FIGURES ... 8
LIST OF TABLES ... 9
CHAPTER 1 - INTRODUCTION ... 10
1.1 Background ... 10
1.2 Research Problem ... 11
1.3 Research Objectives... 13
1.4 Significance of Study... 13
1.5 Research Question ... 13
1.6 Hypothesis ... 13
CHAPTER 2 – LITERATURE REVIEW 2.1 Company Management System ... 13
2.2 Previous Studies... 46
CHAPTER 3 – RESEARCH METHODS ... 47
3.1 Research Framework ... 47
3.2 Structured Interview Diagnosis ... 47
3.3 Customer Survey ... 54
CHAPTER 4 – RESULTS AND DISCUSSIONS... 57
4.1 Quality Fuction Deployment ... 57
4.2 Business Performance Result ... 60
4.3 Customer Survey Analysis Result ... 62
CHAPTER 5 – CONCLUSION AND RECCOMENDATIONS ... 66
5.1 Conclusion ... 66
5.2 Recommendations... 66
5.2 Future research of TQM Implementations ... 66
GLOSSARY ... 67
REFERENCES ... 67
CURRICULUM VITAE ... 70
Bayu Cahyono LIST OF FIGURES
Figures Page
1. TQM Focus on ‘Q uality of Company’ Not only Q uality Product and Process ... 10
2. Total Quality Management outline ... 11
3. House of Total Quality Management ... 13
4. PDCA Cycle ... 18
5. How to Grasp Fact ... 20
6. Flow Process of Policy Management (Company Management System) ... 26
7. 5 phases of Strategic Management ... 27
8. Concept of Policy Management ... 36
9. Deployment of Policy ... 37
10. Flow Process – Daily Management ... 42
11. Relationship between Daily Management and Policy Management ... 43
12. Dashboard of Daily Management Level_1 – SQCDM ... 45
13. Dashboard of Daily Job Load, Problem Solving and QCC ... 45
14. Conceptual research framework - TQM and Organization Performance ... 46
15. Research framework ... 47
16. Result of internal diagnosis – All Division ... 53
17. Result of internal diagnosis – All Plant... 53
18. Concept of Quality Function Deployment ... 57
19. Technical correlation vs technical requirement ... 58
20. Mapping of customer requirement ... 59
21. Business performance vs TQM implementation ... 60
22. CS survey and TQM Implementation ... 62
23. Quality Function Deployment – After Improvement ... 64
Bayu Cahyono LIST OF TABLES
Table Page
1. Example of Policy Management ... 12
2. Example of Daily Management ... 13
3. Internal diagnosis check-list... 14
4. Attribute of survey ... 54
5. Result of Customer Satisfaction Survey Y2020 ... 56
6. Indicator of CS Survey attributes... 61
