According to Sashkin and Kiser, “Total Quality Management (TQM) may be defined as creating an organisational culture committed to the continuous improvement of skills, teamwork, processes, product and service quality and customer satisfaction.” TQM refers to the continuous improvement in the quality of work of all employees with the focus on satisfaction of the customers.
Elements of TQM are:
- Meeting customers requirements,
- Continuous improvement
- Empowerment of employees.
Both TQM and Performance appraisal evaluation are focused on increasing the productivity of the organisation through continuous improvement. They both facilitate the systematic management of all the processes, actions and practices at all levels in the organisation.
Some of the benefits of both the performance appraisal and TQM are:
- Improvement in the performance of the employees
- Brings quality consciousness
- Better utilization of resources
- Commitment to higher quality
But there also exists a few other schools of thought which refute the compatibility of the TQM and performance appraisal. According to them, both TQM and Performance appraisals differ in their fundamental nature, characteristics and requirements making it impossible to combine them.
Some fundamental differences between the two are as follows:
- TQM is team – based whereas performance appraisals are designed for individuals i.e. it undermines teamwork.
- TQM focuses on customer satisfaction whereas performance appraisal focuses on the improving the performance of the employees.
- Performance appraisal generally results in some rewards like increased pay etc. whereas TQM may or may not yield visible results.
Performance appraisal can sometimes, encourage an employee to focus on his personal goals (like his promotion) rather than the organisational goals. Therefore, the suitable practice should be chosen carefully by the top management and the leaders of the organisation.