This study aims to analyze the effect of total quality management on
organizational performance with knowledge management as a mediating variable.
The many types of businesses such as Micro, Small, Medium Enterprises and Large
Enterprises (UB) in Indonesia make them have to be able to compete tightly and
with a strategy that is able to provide the best quality to customers. So that the right
literature is needed so that MSME actors can develop according to the times.
The object of this research is Micro, Small and Medium Enterprises which is
engaged in manufacturing, has been established for at least four years and has a
minimum of three employees. Total quality management variables use indicators of
team work, process management, information and analysis, leadership, customer
focus. Variable knowledge management using knowledge acquisiton indicators,
knowledge sharing and knowledge applications. Meanwhile, the organizational
performance variables use financial performance and operational performance as
indicators. The sampling technique used was purposive sampling method. The
analytical tool used in this study is a simple panel data regression with SPSS 16.
The results showed that total quality management practices had a positive
effect on organizational performance. Total quality management practices have a
positive effect on knowledge management. Meanwhile, the mediator variable
knowledge management on the effect of total quality management practices has a
positive effect on organizational performance.