Hi Esteemed Collegues,

I work for a contract testing laboratory which provides analysis of blood samples taken during clinical trials of new medicines. Fortunately the business is rapidly expanding, including the quality department. We are about to enter another recruitment drive and I just heard the following comment:

'all these new positions are non revenue generating'.

From a QA perspective, how do I counter that?

Cheers.

Hi Esteemed Collegues,

I work for a contract testing laboratory which provides analysis of blood samples taken during clinical trials of new medicines. Fortunately the business is rapidly expanding, including the quality department. We are about to enter another recruitment drive and I just heard the following comment:

'all these new positions are non revenue generating'.

From a QA perspective, how do I counter that?

Cheers.

Quite often I am referred to as "necessary overhead". Makes me feel loved. :rolleyes: However, the preventive nature of my function may mean that while I don't generate revenue, I can prevent spending it (i.e, wasteful activities).

I would agree with them. QC can never be revenue generating when it is a service to other areas of a business (as a stand alone business different issue).

However, without quality, you will be unable to generate revenue (especially in your business). My wife spent almost 10 years working in your very industry here in Canada. I can tell you that with all the government regulations on laboratories, quality was an absolute to ensure that you could even operate your business (there are "blessings" required from government in order to operate your business).

Furthermore, the government will not hesitate to revoke your license if your quality standards are not maintained.

In summary, quality is to be considered one of the foundation blocks of your business. Just like all the laboratory equipment, you cannot operate your business without an effective quality department. Do note...I did not say anything about the number of people. I have found in general that most quality departments are extremely bloated and could operate with at least 10% less people. I would ensure that the department was running as effeciently as possible before responding to the statement

John

'all these new positions are non revenue generating'.

From a QA perspective, how do I counter that?"Correct, they are revenue-maximizing positions."

Hi Esteemed Collegues,

I work for a contract testing laboratory which provides analysis of blood samples taken during clinical trials of new medicines. Fortunately the business is rapidly expanding, including the quality department. We are about to enter another recruitment drive and I just heard the following comment:

'all these new positions are non revenue generating'.

From a QA perspective, how do I counter that?

Cheers.

Neither is payroll.

Actually, done right, QA is loss preventing, which is revenue generation's first cousin.

Show me the Money!

I wouldn't bother to counter that, primarily because it's true, the objective of quality is to increase efficiency, ensure compliance to requirements, keep customers happy...at best Quality increases revenue via the improvement cycle, but unless you're contracting your auditors out...you're not actually directly generating revenue. However, you wouldn't have certification without a quality dpt. therefore you likely wouldn't be expanding your customer base, so on and so forth...I wouldn't argue that quality generates revenue, rather I would argue that Quality provides the means to succeed in todays business environment and the tools to maintain that success. :rolleyes:

However, the preventive nature of my function may mean that while I don't generate revenue, I can prevent spending it (i.e, wasteful activities).

However, without quality, you will be unable to generate revenue (especially in your business).

Furthermore, the government will not hesitate to revoke your license if your quality standards are not maintained.

Just like all the laboratory equipment, you cannot operate your business without an effective quality department.John

"Correct, they are revenue-maximizing positions."

Actually, done right, QA is loss preventing, which is revenue generation's first cousin.

Great answers! If your customers wont buy your product because of poor quality, you'll wish you had spent some money on "non-revenue generating activities"

Thanks Guys.
I agree with you all. I like to think that my function is to help maintain consistency and compliance, but facilitate improvements in efficiency and effectiveness.

Actually it is our quality system, the membership of government quality schemes (GLP) and maybe the responsibilities of our quality department, as well as the science and services we offer, that help us to gain new customers and to get repeat business from exisitng customers.

Remember, quality holds up the business....

Neither is payroll.

Actually, done right, QA is loss preventing, which is revenue generation's first cousin.

Neither is management, but they also provide a necessary function of business.

...Remember, quality holds up the business....




Be careful how you phrase that. That sentence can be interpreted in two significantly different ways...and one of the ways would not be viewed as a positive....:cool:

I know, that's why I like it. In one large org I worked in, it was the negative view, which many people still hold in other orgs. But the positive view is correct if we do our job effectively.

I know, that's why I like it. In one large org I worked in, it was the negative view, which many people still hold in other orgs. But the positive view is correct if we do our job effectively.

Just remember, the bean counters in Accounting, who like to call you non-value-added overhead, are themselves non-value-added overhead...

that's why you get them involved in assessing quality costs - then they can see just how you save money / add value

In most cases senior or top management isn't revenue generating either.

In most cases senior or top management isn't revenue generating either.

Unfortunately, they make decisions regarding Quality staff.....