Discuss the application of William Edwar

Discuss the application of William Edwards Demings 1st principle of quality management (i.e. create constancy of purpose toward improvement of product and service) through the use of a 21st Century industry example. AbstractTranslate Abstract Purpose The purpose of this paper is to provide an overview of the major themes of the quality movement in the past 25 years along with some of the lessons learnt from this. The future direction of quality is then explored by identifying a number of issues which are likely to impact on quality in organisations. Design/methodology/approach The approach is a review of trends in the academic, professional and business world around quality. Findings -The main outcomes from the past 25 years of quality are presented and discussed along with the lessons from this experience. A number of current and future trends on the quality movement are identified and discussed. Research limitations/implications Emerging trends are identified which could provide the stimulus for future research. Originality/value Lessons for managers and leaders on the mistakes of the past and matters which they will need to deal with in the future are presented. Full TextTranslate Full textThe TQM Journal 25th anniversary special issue Edited by Dr Alexander Douglas Introduction Quality can be defined in various ways although meeting or exceeding customer expectations is a frequently used term. The general principles of quality include ([8] Evans, 2005): continuous improvement; teamwork; empowerment; use of data and facts for decision making; problem solving; and customer satisfaction. The quality movement can be seen as a term which could be seen as referring to a set of ideas and principles incorporating those listed above which are adopted in organisations under a variety of names including: total quality management (TQM), Six Sigma, ISO 9000, business excellence and many other more specific tools and techniques such as lean manufacturing, quality function deployment and statistical process control (SPC). It might be considered as encompassing broader organisational cultures, strategies and structures involving leadership, continuous improvement and employee involvement to very specific operational tools such as seven tools, SPC, 5S and so on. Whist the idea of quality has been around for a long time, it really became widely discussed and adopted during the 1980s. Stimulated by increased global competition and rising consumer expectations, quality became very much front page in business publications and the consulting world. Publicity around organisations who had successfully adopted it was widespread. National and regional quality awards emerged and academics started researching the phenomenon. Journals specifically devoted to it were launched. Looking back, what has been learnt from the past 25 years or so and what trends are apparent now and what might emerge in the next 25 years? The quality movement in the past 25 years If we look at what has happened in quality over the past 25 years, we can see a few key themes and foci. These are discussed as follows. TQM and the quality gurus The 1990s saw TQM as headline quality in many western countries. A catalyst was the publicity surrounding Demings views in the business press and an environment in which many US companies were facing considerable competitive pressures from Japan. Japanese products, once judged as inferior, had infiltrated many US markets, particularly motor vehicles, household appliances and electronics. US companies were finding that they could adopt the ideas which Deming and Juran had provided to the Japanese following Second World War. The trend was also strong in Europe, the UK, Australia and elsewhere. In Australia, a number of seminars and user groups spread the message of the benefits of quality management and usually showcased how organisations were using it to experience benefits. It also prompted academic researchers to investigate claims of the benefits of adopting quality. This drove a significant growth in consulting businesses which marketed TQM and much of this era was driven by ideas from a number of so called quality gurus such as [7] Deming (1986), [16] Juran (1988), [9] Feigenbaum (1991), [4] Crosby (1979), [14] Imai (1991) and [15] Ishikawa (1982). This era also tended to be laced with jargonised approaches to quality with each author and consultant offering their own unique version. The core principles of quality were often lost in the detailed models of quality. Much of the business experience of TQM was around teams and systematic processes for problem identification and solution using a variety of tools and techniques such as Ishikawa diagrams, the seven tools, the seven new tools, process improvement teams and quality circles. [6] Dale and Lascelles (2007) use the term tool pushers to highlight the focus of many organisations in this era. A problem was that many organisations failed to develop organisational cultures to support the broad philosophy of quality and therefore remained tool pushers. Without supporting leadership and organisational processes and structures, the ideas were doomed to a short lifespan. Quality awards and business excellence Governments and other organisations keen to promote widespread adoption of quality in organisations established awards and frameworks for promoting and developing quality (Baldrige, Australian Quality Award, European Foundation for Quality Management EFQM). These were developed in the late 1970s and early 1980s and many countries introduced quality frameworks which were usually based on the Baldrige or EFQM models. A large number of organisations adopted these primarily as a means of self-assessment of their progress on the key dimensions of the model and for introducing organisation wide quality. Very few were actually interested in applying for awards. By the end of the twentieth century, a new term, business excellence was favoured over quality and so these frameworks became business excellence. In 2010 the word quality was dropped from the Baldrige award and to some degree reflects the negativity which had developed around the word quality and the associated view that it had failed as an organisational improvement concept. Quality was now perhaps seen as a failure, or that it had been a fad and now organisations needed to move to something else. Some were critical of the movement to the term excellence and dropping of quality ([5] Dale et al. , 2000). Whilst the frameworks and awards based on these are still around, the general level of take up by organisations is relatively low. ISO 9000 At around the same time as the TQM mania developed, the promotion of the international ISO 9000 standards grew in importance globally. The late 1980s and early 1990s was a period when many companies were looking to use systems of accreditation for their suppliers and this applied also to governments and even the European Union. Thus, many organisations sought certification to ISO 9000 in order to enter particular markets, tender for government contracts and supply large organisations. Many small organisations were caught up in this movement. Research into the benefits ([1] Brown and Van der Wiele, 1996; [25] Van der Wiele and Brown, 1997) suggested that many companies with ISO 9000 were disappointed to lose out to competitors on price where the winning bidders were not certified. It gave rise to the certificate on the wall syndrome or minimalist approach to quality. The outcome of this tended to be many very dissatisfied companies who had spent considerable funds on gaining certification without any real benefits. This helped to give quality, or at least the ISO 9000 version of it, a negative name. Conscious of this, the International Organisation for Standardisation revised the standards by 2,000 to a broader concept which brought it more in line with TQM. The idea was to promote it not just as a means of getting a certificate for gaining contracts but a broader model of organisational improvement. Six Sigma Whilst Six Sigma was first espoused by Motorola in the 1980s, it did not receive much interest in other organisations. It was largely seen as another form of quality management. In the twenty-first century, Six Sigma has become one of the best-known versions of quality in the quality movement and has many consulting companies offering training and implementation for organisations wishing to pursue it. The focus on General Electrics use of it under Jack Welchs leadership helped in achieving this promotion. Organisations have invested large sums of time and money into training for the various belts required in Six Sigma. This is mostly confined to large companies. It has been perceived as primarily a statistically based hard form of quality. Integrated quality management By the late 1990s, a view which had developed was that quality should be integral to all organisational processes and that quality was a term which should not be used in isolation. Business improvement ideas like balanced scorecards ([17] Kaplan and Norton, 1992), business process reengineering ([11] Hammer and Champy, 1983) could be integrated with quality management principles and practices. In 2002, [2] Brown (2002) indicated that evidence from Australian organisations suggested that quality had moved to a stage where it was seen as IQM in leading organisations which were using the Australian Business Excellence Framework. Many organisations have developed integrated systems for environmental, occupational health and safety and quality. Marketing, customer satisfaction and service The customer satisfaction aspect of quality was the focus of the marketing gurus such as [20] Parasuraman et al. (1988) and was focused mainly on the service industry. The growth in interest in quality in service as opposed to manufacturing organisations during the 1990s in particular provided another dimension to quality. Based mostly in the marketing discipline, work involved identifying the dimensions of service quality and measuring it with an instrument developed (SERVQUAL) by [20] Parasuraman et al. (1988). This was widely used by organisations to identify gaps between customer expectations and service delivery. It is now relatively common practice for organisations to systematically measure customer satisfaction. The importance of customer relationship management was a prominent part of the quality movement during the latter part of the twentieth century. Lessons By 2,000, quality had reached a point where managers and CEOs were afraid to use the term even though they would not disagree with the fundamental philosophy and the importance of quality for organisational success. Certainly, they would not suggest that their organisation had adopted a quality strategy as this might suggest that they were using something which had gone beyond the use by date. Many employees had become cynical of quality as it had often been introduced into organisations without careful consideration and had often failed to be adopted as a core philosophy. Despite the many disappointments, the introduction of quality management in numerous organisations has left what might be termed deposits ([27] Van der Wiele and Brown, 2002) which has elevated the recognition of quality. Some might claim that it has become mainstream and in effect integrated quality management. Clearly, the lessons from the past 25 years might be distilled into what quality is and is not. Many organisations throughout the world have had very positive experiences and benefits from adopting quality management. We can learn from these, particularly those which have enjoyed sustained benefits ([29] Brown, 2013). What quality is: Quality is endemic to organisational life. It could be argued that if organisations are not paying attention to quality then they are not in the race for survival let alone prosperity. This might be debatable as there are many organisations producing extremely shoddy products and services yet survive on the basis of low prices or monopoly power. Quality is not jargon. It is a set of principles which can be applied through both soft (e.g. organisational culture, leadership) and hard elements (e.g. SPC). Quality requires a critical mass of support in organisations to be sustained. Whilst having leaders who are passionate about quality is a key success factor, line managers and supervisors also need to be driving forces in medium to large sized organisations. They are the quality champions. Quality is highly dependent on the passion and drive of the most senior leader in the organisation. Without this, quality may only be confined to isolated pockets of organisations. Leaders set expectations about values and behaviour. Quality is based on core principles which over-ride all specific processes and practices. Broader approaches and frameworks such as Business Excellence must be supported with specific policies and practices which support and offer all organisational participants specific ideas for action. Research by [23] Powell (1995) showed the soft elements of quality and organisational culture were more important in producing benefits that hard and technical aspects. Quality is holistic and so all organisational practices, policies and procedures need to align. e.g. HRM and recruitment and selection practices which ensure people are appointed on the basis of fit with cultural values of the organisation. Quality needs to be meaningful to everyone in the organisation so that it can be operationalised and be an integral part of everyday activities. Each organisation is different which requires the adoption and adaption of whatever quality approaches, tools, processes and techniques suit its objectives. Self-assessment using an improvement matrix can be an effective and disciplined way of developing a quality strategy across an organisation. Many organisations used business excellence frameworks to guide them in this process. What quality is not As we speculate on the direction of the quality movement in the next 25 years it is clear that many organisations lost their way with quality as evidenced by: Relying on quality managers to drive quality. Delegation to quality specialists makes it clear that senior leaders are not serious about quality or that they do not understand that it is for everyone in all roles in organisations. Using quality departments to manage quality. Quality is integral to all in the organisation. Assigning it to a department is likely to lead to quality constipation and analysis paralysis and a them and us mindset. Leaders not walking the talk. Leaders who espouse the values of their organisations and then show personal behaviour which violates these do not have any credibility. Adopting minimalist approaches to ISO certification. Leaders looking for recognition through new initiatives. Obsession with and over-use of Key performance indicators (KPIs). Far too many organisations have far too many KPIs. This consumes serious amounts of time in developing, managing and measuring which adds no value and usually leads to setting low standards and minimalist behaviour. Obsession with collecting and disseminating information but not effectively using it. Organisations are very adept at generating volumes of data and reports without serious consultation with the users of such reports about what information they really need to make decisions. Adopting off the shelf packages. Whilst this may work for some organisations, a one-size-fits-all approach has not produced sustainable outcomes. Just focusing on doing things right is never enough as quality is also about doing the right things. Increased organisational complexity. Simplicity not complexity needs to become the organisational mantra. Many quality adopters in the past 25 years have believed that quality equated to more processes, systems and so on. Innovative organisations found that strategic plans could be fitted to a page; Toyota has a principle for new business propositions being fitted to a single page. Something which can be introduced across an entire large sized organisation quickly. Support needs to be built up through champions and success stories which can be communicated to spread the message of benefits. Many large-scale installing efforts of the 1980s and 1990s failed. If leaders continue to fall into these traps then real sustainable quality efforts are not likely. The quality movement in the next 25 years Growth in compliance quality In many countries throughout the world, public policy and government legislation has driven organisations to devote increased resources to ensuring they comply with regulations, laws and accountability requirements. This has led to increased employment of compliance specialists and incorporation of compliance requirements into many jobs and tasks within organisations. It is one of the most serious challenges to real quality improvement in organisations over emphasis on doing things right rather than doing the right things. It represents a minimalist approach to quality. Along with government legislation to comply with, many industries have varying degrees of control exercised through accreditation requirements which may be voluntary, e.g. higher education or compulsory, e.g. aged care institutions. Whilst some of these requirements may be quality driven, the aim of much legislation is to ensure minimum standards are provided to customers. In cases of voluntary accreditation, the motivation for organisations may be to gain perceived marketing benefits from being accredited, e.g. AACSB, EQUIS for university business schools. In many instances individual organisations in an entire industry may be driven to secure accreditation for fear of being the odd one out. A challenge for the quality movement in this environment will be marketing the ideas when many employees and managers see quality as compliance and hence little added value. Quality needs to be seen as something which improves their jobs, the workplace and interaction with customers rather than some drudgery which takes them away from their core work. Responding to compliance should not result in excessive employment of compliance clerks and new processes and systems which stifle initiative and creativity. Avoiding quality constipation and analysis paralysis Far too many organisations have become bogged down in efforts to do things right while neglecting the need to do the right things. More and more policies, procedures and constraints on innovation and initiative in organisations have produced ever increasing non-value added work. Thus while organisations may end up with beautifully sophisticated and complex quality control, quality assurance and compliance systems, they do not actually produce significant benefits in the marketplace. Decisions take longer, chains of command are increased, initiative and empowerment is removed, more attention is on non-core activities and so the story goes on. Managers and quality control officers are appointed who then create endless empires of control and policy clerks often developing complex and sophisticated software as control mechanisms. The focus becomes entirely mechanistic, organisations lose their agility. A simple solution would be to justify these developments in terms of simple cost benefit analysis of value add analysis. The principle of lean organisation needs to be applied to administrative areas and not just manufacturing or front line service. KPIs are another area of modern organisations where too much time is consumed. Instead of having the vital few indicators which key proponents advocate ([21] Parmenter, 2010) organisations end up with 50 or more. This generates a significant amount of information which everyone throughout the organisation needs to report on. It seems to become a core activity in its own right, driving performance management, data analysis and reporting meetings, reports and so on. It promotes reporting, box ticking, silos, poor customer relationship and development and focusing on what can be measured rather than informal organisational development and innovation. Greater attention needs to be paid to processes and not outcomes. This is fundamental to the views expressed by [14] Imai (1991) and [21] Parmenter (2010). Need for more aspirational or proactive quality Organisations may be stimulated once more to adopt fundamental quality principles in order to be competitive in the market for their products and services. Whilst the trend in the last decade has been to pay less attention to quality as a specific strategy, organisations may realise that continuous improvement, teams and such are structured ways of ensuring quality is a focus for all in the organisation. This needs to be driven by internal forces as a response to environmental forces rather than be driven by external factors such as consultants, large companies and governments. Much has been espoused about the need for innovation in organisations and quality management can play an important role in facilitating this whether it by incremental improvement through teams identifying innovative ways to deal with organisational problems and challenges or breakthrough innovation by providing a workplace culture which nourishes innovative behaviour. Here we are not just talking about the work environment of leading edge innovators like Google or Microsoft but everyday organisations. [3] Campbell (2000) has identified the need for and benefits from having proactive employees. The notion of employee empowerment is a core principle of quality and organisations need to identify the core competencies required and create processes, training, hiring and reward systems to facilitate and build this. This may be at an individual or collective level. The opportunity to delight and wow customers can be a very strong source of competitive advantage. Another driver for aspirational quality is to tap into the talents of employees by providing workplaces which provide jobs which meet the needs and expectations of employees. Much has been made of talent management and Generation Y expectations ([13] Hewlett et al. , 2009) and the need for employer branding in order to attract and retain these people. Offering workplaces which provide empowerment, encourage and facilitate initiative, continuous improvement and such are likely to be fundamental in this quest. Recycled ideas The consulting industry and authors of the popular management books are very adept at taking old and existing ideas and making them appear new again through packaging and titles which seemingly offers something new to managers and leaders of organisations. Many ideas tend to go in roughly 30-year cycles. Just like we saw social responsibility of business in the 1970s, we now have corporate social responsibility or CSR. We saw the learning organisation ([24] Senge, 1990) take ideas of the open systems theory ([18] Kast and Rosenzweig, 1970) from the late 1960s. We saw the Six Sigma of the 1980s (Motorola) reborn in the twenty-first century. It is important that leaders and managers learn from the past mistakes of jargonising quality. Employees are very aware of old wine in new bottles and the introduction of so-called new initiatives. Whilst these may be important for the career paths of executives and revenue for consultants, past experience has shown they are most likely to fail. Employees generally fail to respond to continuous introductions of new initiatives. Leaders and managers need to get back to basics and read some of the books and research from the 1960s and 1970s Ensuring the quality of contractors and suppliers Many businesses have outsourced functions and activities during the past decades. Ensuring the quality of the products and services which they supply is central to the reputation of the final provider and many ideas of quality in the past 25 years were built on the idea of engaging suppliers in the quality chain. Increased numbers of suppliers make this an increasingly complex and demanding task, for example, in motor vehicle and aircraft manufacturing and large construction projects. Many large organisations have faced reputational damage due to failures of components from their suppliers. Take the issues faced by Boeing with its Dreamliner 787 aircraft in early 2013. The manufacturer faced a grounding of all 50 or so new planes due to a problem with a lithium ion battery which had experienced overheating and fire issues. Whilst not made by Boeing, it caused considerable embarrassment for the company and will likely result in considerable legal costs in payment to the affected airlines. Airbus also faced a similar issue in relation to one of its engine suppliers, Rolls Royce. A near catastrophic engine failure on a Qantas Airbus A380 was traced to poor welding on an engine pipe. In an industry where safety and reliability are core quality dimensions, these issues with component suppliers caused considerable reputational damage for the end user. Service level agreements are usually seen as the mechanism for effectively managing outsourced functions and activities. These are typically very complex and lengthy documents. Innovative organisations have reduced these to two pages maximum. Managing multi-site quality Organisations with multiple sites especially in diverse geographic locations and also in different cultural settings will require a concerted effort to ensure consistency with quality. This might apply to organisations in a national market such as Australia with very geographically distant city centres or multi-national organisations operating across some or many countries. In the latter case, diversity in cultures, political, social and economic environments presents many challenges in coordinating quality. Even the meaning of quality differs in different cultural contexts. For example, research (Telstra) found quality in Australia was linked to relationships between customer and supplier, in France it was seen as linked to prestige, in Germany to technical excellence and in the USA to achieving stretched goals. Issues within single countries include; different levels of support for quality from leaders at different sites, communicating the vision across sites, constraints on the opportunity for leaders to practice management by walking about and having different suppliers. Even within a single city, a company may have several sites with one being the headquarters which might often mean quality is taken with greater zest and passion because this is where the CEO is located. International brands have consumer expectations about consistency in products and services. For example, a BMW purchaser would assume that a car made in South Africa, Germany or China would all be of equal quality, but is this so? Can the company manage consistent quality in different cultural contexts even though they have extensive training and development programmes? In the hotel industry, a Holiday Inn, Hilton or Accor property should deliver consistent service quality irrespective of location. Disneyland in Paris, Hong Kong or California should all have similar service standards although experience has shown that in Paris, despite no smoking signage in queue areas, French patrons often ignore it as it seems to be the French way to do as one pleases. To what degree are consumers prepared to accept cultural variations in what may normally be a standardised product or service. Changed quality attributes in the e-world The internet has become the norm for purchases of a wide range of consumer products and services including flights, hotels, cars, shoes, clothes and electronic items. How has this changed the quality landscape? Different dimensions of quality become important such as trust in an on-line supplier, quick, safe and cost-effective delivery, market appeal and ease of use of web sites, warranty and returns policies and convenience and so on. Immediacy and convenience are major quality dimensions to the consumer in these markets. The e-world has also dramatically changed the nature of competition, ease of entry into the market, warehousing costs, business start-up costs and so on. [22] Poulymenakou and Tsironis (2003) outline a variety of ways in which electronic commerce impacts on quality management. Where to for business excellence? In some countries, e.g. Australia, there has been a steady decline in interest in using the excellence framework and applying for awards. Why might this be and what are the alternative approaches which an organisation might use to guide their strategy? In Europe and the USA, the awards have moved away from focusing on quality and to something seemingly more generic. Has it gone too far and become so generic to be meaningless? Whist the past 25 years has seen thousands of organisations throughout the world adopt the business excellence frameworks, what will the next 25 years see? This must have been a good thing for the quality movement in terms of diffusion of ideas about excellence and self-assessment. At the same time, what evidence do we have about the beneficial and sustainable impact of this? Have organisations found it too hard and given up? Are there any residues and deposits from the application of excellence frameworks? Quality in different cultural contexts How do different cultures see quality? How do organisations operating in diverse cultural contexts adopt quality principles? Can the same tools, processes and techniques which work in the USA or Europe be applied in China? These are some challenges faced by multinational corporations. Many have found that what works in the home country fails when introduced in other countries. This has been an experience with western companies operating in some Asian cultures where process improvement teams have failed to produce any real benefits often because of the cultural values of not openly criticising or questioning ideas from ones superiors. Does quality always pay? (Price more important than quality) Whilst there are plenty of claims and evidence that quality pays, many organisations have discovered that quality may not pay in terms of survival. Take many consumer products which are manufactured in low cost countries such as Asia and Eastern Europe. Many companies in Australia, the UK, western Europe, the USA and elsewhere have gone out of business due to these products being cheaper and therefore purchased by consumers. Many companies have ceased manufacturing in their home countries and now produce off-shore in China or other low cost countries in Asia and elsewhere. In many cases the non-imported products, where still available, may be of superior quality on many attributes such as design, maintenance, safety, longevity, reliability, accuracy and so on but in the face of tough competition, both private and business consumers may opt to purchase the cheaper version even if it may not score as high on these dimensions as a higher quality product. The significant economic growth experienced by the Chinese manufacturing sector and subsequent decline in many competing countries has not been due to a surge in quality but mostly cheaper products produced using very low cost labour in plentiful supply. Non-savvy or cash strapped consumers may purchase a product on price even though it may only last a short time. Of course, it very much depends on the needs expected of the item. What this suggests is that consumers are very often less discerning when it comes to quality in a tight budgetary situation. Furthermore, in some cases, consumers may have no choice as retailers do not offer alternatives. Thus, companies who choose to develop and produce a superior quality product may not be able to compete on price in a market where price is the primary factor in the purchasing decision. Cost cutting and low-cost production is seen as the principle business strategy rather than quality. The challenge is to influence the buying behaviour of consumers, both business and private, to purchase on the basis of attributes other than price. This is an opportunity for quality in a largely price driven consumer market. Conclusions Quality is endemic to organisational prosperity. The challenge which most organisations have found is in operationalising it and generating a culture in which it is as natural as coming to work. We j

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