What this means is that they concen

What this means is that they concentrate on quality at every stage in the production process. Everyone that works for a firm deals with internal customers, many also deal with external customers. Take for example, the case of a product that goes through 3 processes before being sold to the end (external consumer):
Teams of workers are involved in carrying out the 3 processes. Each team should be responsible for guaranteeing the quality for their process. In this way there should be no defects or waste from the process - enabling total quality management.
Many companies today operate a system of continuous improvement whereby teams and individuals are constantly seeking to identify small step improvements in production methods so as to make quality improvements to create even more satisfied internal and external consumers.