The origin of quality goals

The origin of quality goals

Quality goals have multiple origins. In the case of business enterprises, many of the quality goals originate from customer needs. Each customer need becomes a goal to be met. Such goals can be said to be market driven.

Other quality goals can be regarded as technology driven. They usually arise when a company develops a new technological concept that has never before been marketed. It is then necessary to create a market by convincing customers that they need the service provided by the new concept.

An example was the "walkman" type of audio cassette player. The company that developed this product did not do so in response to known customer needs. It gambles that the product could create a market.

A further source of quality goals is the inner drives of human beings. The meticulous housekeeper devotes much energy to maintaining a spotless home. Some managers similarly strive for perfection in the management of the companies.

Yet another source of quality goals is the mandates imposed by social forces: the laws, regulations, peer pressures, and behavior patterns imposed by the culture.

It is evident that there are multiple sources oq quality goals. How ever, most quality goals can be said to originate with. Customer needs, provided we broaden the definition of "customer" to include anyone who is impacted by our activities.

The origin of strategic quality goals

Strategic quality goals is a special category that has only recently entered the business plans of companies. Because the concept has a profound effect on operations as well as on quality planning, we shall examine the events leading up to establishing strategic quality goals. This examination takes us into a semantic jungle, since the terminology has not been well standardized, so we shall define the key terms as we go along.

The visions

Some companies have adopted the word "vision" as an expression of what they would like to accomplish, or where they would like to be, sometime in the future. Statements of the vision take such forms as :

To be the low cost producer

To be the market leader

To be the leader in innovation

To be the quality leader

Such statement by themselves are not much more than a wish list. Publication of such statements, no matter how eloquently done, does not tell the people in the organization what they should do that is different from what they have done in the past. The vision statement must somehow be converted into a list of specific goals to be reached, along with the road to be followed in order to meet those goals. That conversion is accomplished by the planning process.

Policies

Many companies publish guides to managerial action, known as management "policies". These take such forms as :

We will promote from within

We will not be undersold

Our products should meet customers perceptions of good quality

Our products should equal or exceed competitive quality

Such policies are typically approved at the highest organization levels, and do influence managerial action, especially if they are enforced through audits and the reward system.

From Visions to Strategic Quality Goals

Visions resemble wishes. They have little relation to reality until they are converted into specifics-into quantitative goals which are to be met within a specific time span.

When the Ford Motor Company embarked on the Taurus model of automobile (in the early 1980s), one of the visions was to restore profitability. The quality-related goal became "best in class".

The new, high priority assigned to quality, along with the adoption of Big Q, has created a trend to expand strategic business planning to include strategic quality goals. Here are some actual examples of strategic quality goals established as part of companies' business plans:

Make the Taurus / Sable models at a level of quality that is best in class. (Ford Motor Company)

Improves product and services quality ten times by 1989. (Motorola’s goal in January 1987)

Reduces the cost of (poor) quality by 50 percent in five years. (3M Corporation in July 1982)

Reduce billing errors by 90 percent (Florida Power & Light Company)

(note that all of the above goals relate to major processes, namely: new product launching, customer service, reduction in chronic waste, billing).

Subject Matter of Strategic Quality Goals

Despite the uniqueness of specific industries and companies, certain subjects for strategic quality goals are widely applicable:

Product performance. This goals relates to major performance features which determine response to costumer needs: promptness of service, fuel consumption, mean time between failures, courtesy. These features directly influence product salability.

Competitive performance. This has always been a goal in market based economies, but seldom a part of the business plan. The trend to make competitive quality performances a part of the business plan is recent but irreversible.

Quality improvement. This goal may be aimed at improving product salability and or reducing the cost of poor quality. Either way, the end result after deployment is a formal list of quality improvement projects with associated assignment of responsibilities.

Cost of poor quality. The goal of quality improvement usually includes a goal of reducing the cost due to poor quality. While these costs are not known with precision, they are known to be very high. Despite the lack of precise figures, it is feasible, through estimates, to bring this goal into the business plan and to deploy it successfully to lower levels.

Performance of major processes. This goal has only recently entered strategic business plan. The goal relates to the performance of major processes that are multifunctional in nature, e.g., new product launching, billing, bidding for business, purchasing. For such “macroprocesses” a special problem is: Who should have the responsibility for meeting the goal? We shall discuss this shortly, under the heading “Deployment to Whom?”.

Benefits of Strategics Quality Goals

Establishment of strategic quality goals is a vital first step toward translating the vague vision into reality. Taking this first step also yields some major benefits relative to quality :

The process of selecting the goals stimulates unity of purpose among the upper managers.

Since the goals must be approved at high levels, the upper managers become personally participative.

Goals that are a part of the business plan are much more likely to sevure the needed resources.

The reward system associated with the business plan makes it more likely that the goals will be met.

Nominations of Strategic Quality Goals

The goals selected to enter next year's business plan ideally are chosen from a list of nominations made by all levels of the hierarchy. Only a few of these nominations will survive the screening process and end up as part of the strategic goals. Other nominations may instead become goals for lower levels in the hierarchy. Many nominations will be deferred-they were unable to secure the necessary priority.

Upper manager should become a source of nominations for strategic quality goals, since they receive important inputs from sources such as :

Membership on the quality council

Contacts with customers

Periodic reviews of performance against quality goals

Quality audits conducted by upper managers

Contacts with upper managers in other companies

Quality Goals at Tactical Levels

Historically the great majority of quality goals have been established at middle and lower levels of the hierarchy. These goals are mandated by the large numbers of customer needs, plus the associated product features and process features. This pattern will continue for years to come.

In companies that have gone over to use of strategic quality goals, the deployment process (see below) will create additional quality goals to be met at the tactical level.

The upper manager cannot become involved with individual tactical quality goals-the number of these goals are overwhelming. However, the upper managers can and should become involved with the approach includes such matters as participative planning, a structured approach to replace empiricism, and training for the planning personel. We shall examine these matters in later chapters.