Application of Total Quality Management Principles in Small and Medium Firms

Small and medium enterprises play an essential and important role in economic development and social development in any country. Small and medium enterprises are found in every economy, both advanced industrialized and developing countries. In every economy there are only a few large enterprises, supported by a large number of small and medium enterprises, which explains why 90 % of enterprises are small or medium in size. The problem with these enterprises, especially in developing countries, is that they are a real part of the economy, and the experts call them the informal sector. Because they are managed by their own owners and they are often family businesses, their success therefore depends on the capability of the owners. And, generally, the owners are weak in terms of education, motivation to explore opportunities, and access to technology. This study focuses on the ability of these enterprises in competition, especially with globalization. The researcher has used the idea of total quality management (TQM) to measure how deeply the owners of these enterprises are applying TQM and its principles. The study was conducted in Riyadh city. TQM has been recognized as a successful management philosophy in the manufacturing and service industries. The researcher has selected six main principles in the study. They are: focus on customer, continuous improvement, making decisions based on facts, participation of all stakeholders, team approach, and error preventions. The researcher designed a questionnaire containing three major points: the first point is the personal data like the age, education and the experience; the second point is relates to TQM principles; the third point is a general question about TQM. The researcher randomly selects 210 owners or managers of enterprises and gave them the questionnaire with a brief idea about the study to help them to fill in the questionnaire correctly. 150 questionnaires were analyzed by SPSS software in this study. Descriptive Statistics were performed in terms of Measures of Central Tendency and European Scientific Journal November edition vol. 8, No.25 ISSN: 1857 – 7881 (Print) e ISSN 18577431 21 Measures of Dispersion. Inferential Statistics were performed in terms of Measures of Pearson Correlation, Tests of Hypotheses, Analysis of Variance, Step-wise Regression One Sample T-test, F-test, Chie-Square, and Significance Levels. Descriptive Statistics results showed, in general, the application of TQM principles varies between medium to high rate and the Inferential Statistics results showed a two principles have significant statistically relationship which are focus on customer and continuous improvement.