MTEL Business Practice Exam

Category - Business Operations

Which of the following actions is likely to be a major step in implementing a program of Total Quality Management (TQM)?
  1. Analyzing business operations to identify areas where improvements in efficiency are possible.
  2. Establishing a centralized decision-making structure in which managers are given greater authority.
  3. Instituting a policy of promoting managers from within and basing promotions entirely on merit.
  4. Implementing the lowest cost options that are available at all levels of the production process.
Explanation
Correct Response: A. The purpose of Total Quality Management (TQM) is to provide continuous high- quality products and services to customers. With TQM, all team members work toward the common goal of improving all aspects of the business operation. Analyzing areas where improvements in efficiency are possible is an important component of TQM. Establishing a centralized decision-making structure where management is given authorization to enforce and implement business operations is top-down management (B), and will not necessarily boost quality. Promoting managers from within based on merit (C) may be a good business strategy but it is not a defining component of TQM. Implementing the lowest cost production process may cut costs but may not improve quality (D).
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