Feigenbalcm5 Window on tbe World

Quality and Jobs Are Synonymous

Anrtand V. Feigenbaum

R&t of General System, Inc. in Pittsfield, Massacbusetts, Armand V. Fcigcnbaum, Pb.D., is the originator of total quality control. He is alro foind- ing cbainnan of tbe Intenaational Acadenryfbr Quality Control and tbe first American to receive France's Ge- Bore1 Prize for preeminence in quality.

E xperience in this country and abroad clearly demonstrates that there is an inseparable relationship between quality and jobs. In fact, quality leadership is the best single job creation program in this

intensely competitive world. This is equally true for small and large fums. Strong quality programs have been proven to be essential in small and medium-size f m in export as well as local markets, because value means quality to today's consumer4rom the homemaker to the industrial com- pany. Today, when a customer is satisfied with quality-likes what he or she buys-that customer tells eight people; when the customer is dissatis- fied, he or she tells twenty-two. That's the hard arithmetic of quality's effect on sales growth in the U.S. marketplace.

International quality leadership is essential to domestic quality leader- ship for a business today-even though there may not yet be much import competition or interest in exporting on the part of the company. The U.S. Commerce Department estimates that 70 percent of all products manufac- tured in the United States are now targets for strong import competition; General Systems Company studies indicate that nearly 100 percent of all American non-defense manufactured products will be vulnerable to import competition within this decade.

Services are not far behind. A communications satellite is indifferent to whether jobs of the back office of a frnancial intermediary or an information processor are in New York, Tokyo, or Bombay, as long as they are quality- efficient. In the Far East, software development in such English-speaking countries as the Philippines, India, and Malaysia costs only one-tenth to one-twentieth of similar developments in the United States, and these countries are aggressiveIy positioning themselves with the quality capabil- ity for this kind of job creation and business development. This means that U.S. companies will face many more "Japans" in the 1990s. Murphy's Law, internationalized, says that if a company can face foreign competition, it will.

There is a certain type of leadership needed to implement total quality as a fundamental way of managing competitive improvement, not merely as a loose collection of quality technique projects and fireworks-display motivational seminars that has so constricted quality development in the past. Total quality leadership today is based on the total rejection of a false management doctrine that dominated many public- as well as private-

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Armand V. Fcigenbannr

sector organizations throughout the 1970s and much of the 1980s. According to that doctrine, good management and successful improve- ment meant getting the ideas out of the boss’s head and into the hands of the workers plus regular doses of management cheerleading, underwritten with extensive technique-based seminar programs. But the reality was that when employees returned to their jobs to use what they’d heard, they continued to face (1) ambiguous management processes that they couldn’t influence, (2) having to thread their way through organizations that were a group of separate departmental silos, and (3) the reality that they were still being nickel-and-dimed to death in their work. In such an environment only incremental improvement could, at best, be hoped for. This is a principal reason why some of the great companies that were this country’s business pacesetters of the 1980s are now urgently searching for funda- mental changes in their ways of working. And it is a major reason why some of the admirably intentioned national public-sector improvement pro- grams from the Hoover and Grace Commissions on down gradually died and were buried without autopsy.

Today we know that good management means reintroducing into the U.S. workplace what these management practices of the 1970s and 1980s overlooked or even purged-that is, the fundamental improvement strength that comes from giving workers the freedom to innovate, letting them solve problems democratically, and encouraging teamwork. The improvement centerpoint of many of the private-sector companies that are America’s business leaders today is built around a form of organizational populism that encourages human strengths combined with strong manage- ment leadership. This kind of management has the personal know-how to establish the organization’s quality playbook of the work and teamwork processes that guide improvement and then to quarterback the implemen- tation practices that help every person in the organization think, decide, and act on how to accelerate quality service.

There are several basic infrastructure obstacles blocking management quality improvement in the United States today. The first is a change in fundamental human values and expectations. This is most apparent within the U.S. marketplace and in the slow growth in many U.S. markets. While the value trends are of the American as a consumer of private-sector products and service, he or she is also the taxpayer with similarly escalating quality expectations for public-sector services.

sales remain stubbornly low.. . - -

One of the fundamental but little recognized reasons for the dismal sales results in some U.S. markets during these past few years has been what can best be described as a buyer’s quality strike. Sales remain stubbornly low, even though buyer disposable income that could be spent on the products and services remains at high levels. For many years General Systems has been surveying consumer patterns in major U.S. markets, and the data have shown that buyers have continued to make quality a progressively more important consideration than price in their purchase decisions. As the 1990s have proceeded, there has been a

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fundamental sharpening of this attitude as buyers have become convinced by the widespread advertising and media attention to quality that any private- or public-sector organization can provide essentially perfect quality service if it is properly managed. Survey data for the year 1992 show that nine out of ten buyers now make quality their primary purchasing standard, but in these days of economic constraint, they express this as affordable quality-uality, price, time-saving considerations, and ser- vice-not simply as a tradeoff between quality and price.

This is a statement of the fundamental social and economic change that has been escalating throughout the United States in the past decade. The economic stability and the lifestyles of consumers, as well as the work processes and business velocity of companies, now depend almost completely on the reliable, predictable operation of products and services, with little tolerance for the time and cost of any failures-something very different from the past.

The organizations that understand today’s user values and expecta- tions recognize that in today’s markets quality leadership depends on accelerating the increase in the things gone right that consumers want- total quality-not merely reducing the things gone wrong+raditional quality control. For example, in the private sector, routinely washing automobiles after a dealer service call is a factor that many consumers identify as a principal dealer service value differentiator, because they perceive that it shows care and because it saves them time and effort. They assume-rightly or wrongly-that any responsible dealer can accomplish any technical tasks, such as an emissions check, about as well as any other. Quality expectations in the 1990s aren’t merely measured in such tradi- tional terms as quality defects, zero or otherwise. They are, instead, measured in terms of the total user perception of quality service.

Another infrastructure issue is that, with some notable exceptions, quality improvement is only now entering America’s service sector in a major way. Over the past decade, the emphasis on quality in the United States has been largely centered in the manufacturing sector, with such positive results as the economic revival of the U.S. automobile industry. Over this same period, however, some U.S. service organizations have grown out of touch with the rapid changes in U.S. values, employee attitudes, and management approaches. These disconnected organizations are increasingly isolated from the service quality that their users want, because the attitude change that helped to place U.S. automobile manu- facturers back on the growth track-acceptance that quality is what the user, not the manufacturer, says it is-is not yet recognized in many service organitations. It remains very difficult for service providers in health care, education, or environment, for example, to accept the principle that in the 1990s service quality is the call of the service receiver, not the service provider. This difficulty is compounded by the fact that, although manufac- turers can sometimes unscramble broken eggs by fixing or replacing a defective part, the option of a service defect recall isn’t open to servicers.

Surveydata...show that nine out of ten buyers now make Q d V their Primary Plvchasing Standard.. .

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But service-sector leaders in industries ranging from financial interme- diaries to hospitality providers have now begun to demonstrate that there is no more effective way to return this hidden organization to effective capacity than through systematically improving service quality. The service providers that have been doing this have achieved 25 percent and more additional highquality output with their existing resources.

In the face of these and other infrastructure issues, why the durabdity of total quality, especially when the media report that queasiness about quality continues to grow; when some business, education, and govern- ment institutions hear about the white, the yolk, and the albumen of total quality, but not about the total quality egg itself; and when there are generalized discussions about quality programs, but no coupling with an explanation of the hard-edged improvements they accomplish? The durability in the face of all this is because total quality is the competitive connector today-it connects organizations with their customers, service receivers, employees, and suppliers in volatile times. By doing so, it helps create jobs-a top priority if we are to cast off today's economic doldrums. 0

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