The Effect of Total Quality Management Practices on The Performance of Selected Private Banks Operating in Addis Ababa
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Date
2024-03-26
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Publisher
AAU
Abstract
The major aim of the research paper is to measure the effect of total quality management
practices on the performance of selected private banks operating in Addis Ababa. Because of
the dynamics of competitive advantages used by service rendering organizations particularly
banks and there is no research conducted on the issue in question the researcher was interested
to test and assess the effect of total quality management practices on the performance of banks
by focusing on four Total quality Management practices (Top management commitment,
Customer focus, Employee involvement, and Continuous improvement) were used to measure the
performance (Operational performance, Customer satisfaction, Employee Satisfaction, and
Market share) of three different banks at a branch level. In order to achieve the aims, mixed
method of research with concurrent research design and primary sources of data were used. The
data were collected through self-administered questionnaire. Purposive sampling procedure was
used to collect data from branch managers; Sampling formula ( Slovin’s formula ) was used to
determine the sample size of branch employees. Multiple regressions model and correlation were
used to investigate the relationship between dependent and independent variables. The
regression test showed that selected practices of TQM have positive effect on performance of
selected private banks operating in Addis Ababa. The correlation result indicates that there is a
positive correlation between selected practices of TQM and performance of selected private
banks operating in Addis Ababa. The research provides that Top management commitment,
Customer Focus, Continuous Improvement and Employee Involvement plays the most important
role in the performance of banks. The research finding also indicate implementing total quality
management practices increase the performance of banks in turn leads to operational
performance, customer satisfaction, better market share, and improved employees satisfaction.