Abstract

The main purpose of this paper was to investigate the effect of Total Quality Management practices on organizational performance the case of Bahir Dar Textile SC. It adopted an explanatory research design. The sample size of 71 respondents was drawn using stratified random sampling technique. The study findings of correlation analysis showed that all constructs of total quality management (customer focus, employee’s empowerment, top management commitment, continuous empowerment, supplier quality management, process approach) were positively and significantly affect organizational performance. The findings of the multiple regressions analysis showed that the observed changes in organizational performance attributed by the elements of total quality management practice is 49.4% (adjusted r2=.494). The study also reveals from six major elements of total quality management practices, customer focus, top management commitment, continuous improvement, employee’s empowerment, and supplier quality management has a positive effect on organizational performance, while process approach doesn’t have a significant effect.