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Total Quality Management and Operational Performance of Kenyan Airlines

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Total Quality Management and Operational Performance of Kenyan Airlines TOTAL QUALITY MANAGEMENT AND OPERATIONAL PERFORMANCE OF KENYAN AIRLINES BY JOSHUA LEMCOE OLOO D61/5539/2017 A RESEARCH PROJECT PRESENTED IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF DEGREE IN MASTER OF BUSINESS ADMINISTRATION IN THE SCHOOL OF BUSINESS, UNIVERSITY OF NAIROBI NOVEMBER 2018 DECLARATION I, the undersigned, declare that this is my original work and has not been presented to any institution or university other than The University of Nairobi for examination. Signed: _____________________Date: __________________________ JOSHUA OLOO D61/5539/2017 This research project has been submitted for examination on approval as the University Supervisors. Signed: _____________________Date: __________________________ Mrs. Nancy Marika Lecturer, Department of Management Science School of Business, University of Nairobi Signed: _____________________Date: __________________________ Mr. Ernest Akello Lecturer, Department of Management Science School of Business, University of Nairobi ii DEDICATION This project is dedicated to my supervisor Mrs Nancy Marika (Lecturer, Management Science), and moderator, Mr. Akello Ernest (Lecturer, management science) for their continuous and tireless commitment to see me through this project. To my beloved wife Irene and brother Lt. Col Erick Oloo for their prayers, moral and financial support. May the Almighty God bless you abundantly. iii ACKNOWLEDGEMENT My special thanks are to The Almighty God for all He has done to give me an opportunity to come this far in my studies. iv ABREVIATIONS AND ACRONYMS AMOS – Analysis of Moment Structures BTS – Bureau of Transportation Statistics GDP – Gross Domestic Produce ISO – International Safety Standards JKIA – JKIAAirport KPI – Key Performance Indicators NIST – National Institute of Standards and Technology OP – Operational Performance OPM – Operational Performance Management PAYE – Pay As You Earn PDCA – Plan Do Check Act Cycle PDSA - Plan Do Study Act Cycle PLC – Public Listed Company PQM – Process Quality Management QM – Quality Management QMS – Quality Management Systems RBV – Resource Based View SEM – Structural Equation Modeling SQM – Supplier Quality Management SQP – Strategic Quality Planning TCET – Transaction Cost Economic Theory TOC – Total Operating Cost TQM – Total Quality Management VAT – Value Added Tax v TABLE OF CONTENTS Declaration................................................................................................................................. ii Dedication ................................................................................................................................. iii Acknowledgement ................................................................................................................... iiv Abbreviation and Acronyms ...................................................................................................... iv Table of Contents ....................................................................................................................... vi List of Tables ............................................................................................................................ iv Abstract ...................................................................................................................................... x CHAPTETER ONE: INTRODUCTION 1.1 Background of the Study .......................................................................................................1 1.1.1 Total Quality Management ..........................................................................................2 1.1.2 Operational Performance .............................................................................................4 1.1.3 Kenyan airlines ...........................................................................................................5 1.2 The Research Problem ...........................................................................................................6 1.3 The Research Objectives .......................................................................................................8 1.4 The Value of Study ...............................................................................................................9 CHAPTER TWO: LITERATURE REVIEW 2.1 Introduction ......................................................................................................................... 10 2.2 Theoretical Literature Review ............................................................................................. 10 2.2.1 The System of Profound Knowledge ......................................................................... 10 2.2.2 The Shewhart/Deming Cycle Theory ......................................................................... 10 2.3 Total Quality Management .................................................................................................. 10 2.3.1 Leadership and top management commitment ........................................................... 13 2.3.2 Strategic Quality Planning ......................................................................................... 14 2.3.3 Employee Involvement and Empowerment ................................................................ 15 2.3.4 Training and Development ........................................................................................ 15 vi 2.3.5 Customer Focus ......................................................................................................... 16 2.3.6 Supplier Quality Management ................................................................................... 17 2.3.7 Process Quality Management .................................................................................... 17 2.3.8 Knowledge and Process Management ........................................................................ 17 2.4 Total Quality Management and Operational Performance .................................................... 20 2.5 Empirical Literature Review ................................................................................................ 21 2.6 The Conceptual Framework................................................................................................. 22 CHAPTER THREE: RESEARCH METHODOLOGY 3.0 Introduction ......................................................................................................................... 24 3.1 Research Design .................................................................................................................. 24 3.2 Population ........................................................................................................................... 24 3.4 Data Collection ................................................................................................................... 24 3.5 The Data Analysis ............................................................................................................... 25 CHAPTER FOUR: DATA ANALYSIS, RESULTS AND DISCUSSION 4.1 Introduction ......................................................................................................................... 26 4.2 The Response Rate .............................................................................................................. 26 4.3 Biographic Information ....................................................................................................... 26 4.3.1 The Gender ............................................................................................................... 27 4.3.2 Education Level ........................................................................................................ 27 4.3.3 Knowledge of Total Quality Management ................................................................. 28 4.3.4 Experience ................................................................................................................ 28 4.4 The Implementation of Total Quality Management Practices ............................................... 28 4.4.1 Leadership Support & Senior Management Commitment .......................................... 29 4.4.2 The Employee Involvement & Empowerment ........................................................... 30 4.4.3 Customer Focus ......................................................................................................... 30 vii 4.4.4 The Knowledge and Process Management ................................................................ 30 4.4.5 Training and Development ....................................................................................... 30 4.4.6 Supplier Quality Management .................................................................................. 30 4.4.7 Process Quality Management ................................................................................... 30 4.4.8 Strategic Quality Planning ........................................................................................ 30 4.5 The Relationship between TQM and Operational Performance ............................................ 37 4.5 1 The Model Summary ................................................................................................. 38 4.5 2 The Analysis of Variance (Anova)............................................................................. 38 4.5.2 The Variable Coefficientsa ......................................................................................... 38 4.6 Challenges in TQM Implementation by the Kenyan Airlines ..............................................
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