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Attempts to demonstrate that total quality management (TQM) can be successfully transferred to service industries as well as manufacturing industries. In profit‐making services, TQM can lead not only to reduced costs and greater profit margins but also to greater market share through better orientation to customers’ needs. Highlights the Japanese approach to service quality which is an integral part of the organization rather than just an add‐on programme. Illustrates the condition needed to institute a TQM programme successfully in the service industry and concludes with the thought that without these conditions, TQM merely becomes another panacea doomed to failure.

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