Qualityworld
Quality 21
In the first of a series on TQM, consultants John Oakland and Les Porter explore its development and basic tools and techniques. They also suggest their own framework for TQM in today's increasingly competitive business world.
In the last two decades, organisations have experienced a period of great change in their markets and operations. International and domestic competition has meant that many organisations have faced an increasingly turbulent and hostile environment. Customers have become more informed and demanding, competition more intense and the pace of technological change has quickened.
Regulators and consumer groups have also added to these pressures. As a result, many organisations have adopted a range of improvement approaches. We have seen the growing adoption of QMSs like ISO 9000, the emergence of TQM, as well as a whole host of improvement initiatives like business process engineering, business excellence, performance excellence, lean thinking, six sigma etc. The battle weary could be excused from taking a rather jaundiced view of this ever-lengthening list of quality techniques but, on the whole, they share many of the principles and elements that are found in TQM.
Whatever the type of organisation, competition is rife: for customers, students, patients, resources and funds. Any organisation competes on its reputation for quality, reliability, price and delivery. Most people now recognise that quality is the key to achieving sustained competitive advantage. On the flip side of the coin, reputations for poor quality last for a long time, and good or bad reputations can become national or international. Understanding and putting into practice the following elements of TQM can be insurance for an organisation, as well as tools for excellence.
The voice of the customer
Quality starts with understanding customer needs and ends when those needs are satisfied. Marketing processes establish the true requirements for the product or service. These must be communicated properly throughout the organisation in the form of specifications.
Good communication between customers and suppliers is the key to a total quality performance. An organisation must establish feedback systems to gather pertinent customer information. Appropriate research techniques should also be used to understand the market and to understand the customer base.
Quality, reliability and reputation
Quality is meeting customer requirements, and this is not restricted to the functional characteristics of the product or service. Reliability is the ability of the product or service to continue to meet the customer requirements over time. Organisations delight customers by consistently meeting (or exceeding) their requirements, thereby achieving a reputation of excellence, and gaining customer loyalty as a result.
The quality chains
Throughout all organisations there are a series of internal suppliers and customers. These form the so-called 'quality chains', the core of company-wide quality improvement. The internal customer/ supplier relationships must be managed at every interface. Cut the chain at an interface and you meet a process. Measurement of process capability is a vital part of managing all interfaces.
Design
Design and conformance to design are two distinct but interrelated aspects of quality. Quality of design is a measure of how well the product or service is designed to achieve the agreed requirements - ie doing the right things. Quality of conformance to design is the extent to which the product or service achieves the design - ie doing things right. It is important to differentiate between these two aspects when engaging in quality improvement. It may be helpful for organisations to assess how much time they spend doing the right things right.
Processes and prevention based systems
Everything we do is a process, which is the transformation of a set of inputs into the desired outputs. In every organisation there are core business processes that must be performed effectively if the mission and objectives are to be achieved.
The key to effective quality management is to develop sound prevention based systems that support the organisation's processes. Asking the question: 'Have we done the job correctly or provided the service correctly?' should be replaced by asking: 'Are we capable of doing the job correctly or providing the service correctly?' and: 'Do we continue to do the job correctly or provide the service correctly?' By asking these questions in the right order an organisation can replace a strategy of detection with one of prevention.
Company and top management commitment
Quality problems can seldom be pinned down to a single area in an organisation - there is usually an 'end to end' dimension. All members of an organisation need to work together on organisation-wide quality improvement. Everyone at every interface needs to coorporate to achieve improvements in performance, which can only happen if the top management is really committed.
A brief history of TQM…
Western organisations really began to take an interest in quality and its frameworks at the beginning of the 1980s. But it was not until the late 1980s and early 1990s that there was a global realisation of the strategic importance of quality. At this time many countries established programmes to recognise quality and excellence. These initiatives followed the earlier example of Japan. The Japanese Union of Scientists and Engineers (JUSE) launched the Deming Prize in 1951.
The structure and criteria for these award programmes elevated quality to a strategic level and resulted in some of the concepts of business excellence which we are familiar with today. The majority of these programmes have undergone continuous improvement in framework design and award administration. Organisations pursuing an excellence strategy soon recognised that the award frameworks offered more than just a vehicle for recognition. The award frameworks were seen to be best-practice models for implementing excellence strategies, performing self-assessments, benchmarking and ultimately delivering improved performance.
The US Baldrige Award was the first major formal quality award framework in the west. It uses a framework of seven assessment categories: leadership; strategic planning; customer and market focus; information and analysis; human resource focus; process management; and business results. It has arguably made one of the greatest contributions to the development of TQM and self-assessment. This was followed in Europe by the excellence model, which operates via a similar framework of performance improvement and involves a whole organisation's people in improving processes.
A new TQM model
Whilst the award models provide frameworks for understanding quality and excellence, their non-prescriptive nature makes them unsuitable for bridging the 'quality gap' - they are not implementation models. The self-assessment process against these frameworks provides insights into the deficiencies in the organisation's enablers and the gaps in actual performance but they do not provide specific guidance on best-practice and do not tell you how to bridge the gap.
What is needed is a new model for TQM that addresses the hard and soft issues of quality (see figure 1). The methods underlying this framework, that will be the subject of five further articles in this series, offer the detail required for making improvements in performance - a prescriptive approach that many organisations find helpful in these days of complicated management theory.
Figure 1: The new framework for Total Quality Management
We have seen earlier how processes are the key to delivering quality of products and services to customers. It is clear from the so-called excellence models that processes are a key linkage between the enablers of planning (leadership driving policy and strategy partnership and resources), through people into the performance of people society customers, and key outcomes.
These four Ps are vital to delivering quality products and services to customers, and form a structure of 'hard management necessities' for the new simple TQM model: These include:
- planning - the development and deployment of policies and strategies, setting up appropriate partnerships and resources, and designing in quality
- performance - establishing a performance measurement framework - a balanced scorecard for the organisation, carrying out self-assessment, audits, reviews and benchmarking
- processes - understanding, management, design and redesign, QMSs and continuous improvement
- people - managing the human resources, culture change, teamwork, communications, and innovation and learning
Wrapping around all this to ensure successful implementation is, of course, effective leadership and commitment.
The core of this new model needs to be surrounded by a commitment to meeting customer requirements, communicating the quality message and recognising the need to change the culture of most organisations to achieve total quality. These are the 'soft foundations' (the Cs) which must encase the hard necessities of performance, planning, people and processes.
Figure 2: The SQF - a simple but powerful construct
In recent years quality has been going through a renaissance as organisations recognise that it is the key to achieving sustained long-term competitive advantage. Senior managers and quality professionals must not be afraid of using the q-word. With the plethora of quality approaches on offer, it is important to revisit the fundamentals. TQM is the common pedigree for most of these approaches and offers a sound way of managing organisations in the 21st century
Case studies
BT Retail
All quality programmes have at their centre a very clear focus on customers. Delivering customer satisfaction is the primary goal for BT Retail and the approach is inherently simple - listen to customers and respond to what they say. BT Retail has a wide range of methods for listening to its customers, ranging from market research to asking thousands of customers detailed questions about how they felt about a specific transaction. From this data the company has built quantitative models of the drivers of customer satisfaction which enable them to ensure that internal measures are aligned with what customers really want.
Texas Instruments
During the 1990s it became clear to Texas Instruments that while technological innovation was vital to future success, it was insufficient on its own. The company had to find a way to enable its customers access to the innovations and be supported and satisfied in that process. The adoption of total quality was its chosen route to becoming more customer oriented, while retaining technological excellence. The journey began with the first concepts and has developed over time into the way people do business with customers and each other. Total quality has permeated all Texas Instrument's companies, thousands of people have undergone continuous training and it has become the way of life. The total quality journey took a major step forward in the mid 1990s when the excellence model was adopted for Europe.
Shell Services
Setting up a new global organisation is a challenge in itself. To do this by harmonising existing but different business operations across the world into a single, global organisation adds another level of complexity. Shell Services enabled such a transformation by putting in place a set of processes, systems and tools that became known as the Shell services quality framework or SQF (see figure 2). At the top level, the system is a simple but powerful construct made up of five key chevrons. Four of these are enablers - namely purpose, people, resources and processes. The fifth is the results chevron, which focuses on tracking performance improvement as a result of implementing the framework.
Next time: How to manage total quality using this new 'hard' and 'soft' structure.
Biographies
John Oakland is executive chairman of Oakland Consulting plc and head of its research and education division, the European Centre for Business Excellence. He is also part-time chair in business excellence at Leeds University Business School. Over the last 20 years he has consulted in all aspects of business improvement and quality management. He has directed several large business research projects in Europe, which have brought him into contact with a diverse range of organisations. He specialises in SPC and TQM and has authored books on the subjects.
Les Porter managing director of Oakland Consulting plc is a member of the European Centre for Business Excellence and a visiting professor at Leeds University Business School. After a senior management career in the automotive industry, he entered academia where he developed a leading reputation in business excellence, process improvement and SPC. He has directed several large research projects in Europe and his research was recognised by EFQM in 1994 when he won a European quality award for research. He served as a senior EFQM assessor from 1992 to 1998.
