Definition Quality - Executives Believe Quality Contributes To Bottom Line - Definitions Vary

Wes Bucey

Quite Involved in Discussions
#1
This is a press release (March 15, 2004) from ASQ.
I'm interested in comments from both ASQ members and non-members.

I've put this in the Coffee Break arena to allow more "emotion" regarding the topic than we normally exhibit in our "educational" threads.

I would expect comments regarding the basic topic (excutive perception of Quality) and the role ASQ plays, including the advisability of hiring a market research firm from Milwaukee to perform this study. Is there any relationship between ASQ elected officials or staff and this company? How was it chosen? etc. etc. (The "full report" mentioned is a series of PowerPoint slides - my pet peeve!)
EXECUTIVES BELIEVE QUALITY CONTRIBUTES TO BOTTOM LINE, BUT DEFINITIONS OF QUALITY VARY
MILWAUKEE – A survey sponsored by The American Society for Quality (ASQ) and conducted by Market Probe reveals that a vast majority of American executives believe quality contributes to the bottom line of their businesses/organizations, but the way they define quality varies.


More than 600 American executives from four industry segments—manufacturing, services (including government), healthcare, and education—provided their perspectives on the value that quality brings to their businesses/organizations. Ninety-nine percent of respondents said they believed quality contributes to the bottom line, and 92% believe that an organization-wide, coordinated effort to use quality techniques provides a positive return.

Defining quality did not elicit such uniform agreement. Sixty-four percent of respondents believe that quality is a management tool, while the remaining 36% view quality as being built into a product and service, but not necessarily a management tool. When asked to define quality, a majority of respondents equated quality to “customer satisfaction.”
“It's encouraging to know that most executives, no matter what industry, believe in the practice of quality and the value that it can bring to their businesses, not just in terms of economic return, but also in the form of customer satisfaction,” said Ken Case, ASQ president. “However, it is a bit disconcerting that many executives do not view quality as a business management tool when many of the continuous improvement efforts practiced in business today grew out of the quality discipline and the work of quality professionals.”
The survey also shows that there is a gap between executives' awareness of quality improvement processes and implementation. When asked about their awareness and usage of benchmarking, total quality management, quality circles, ISO 9000, Six Sigma, and Baldrige, respondents from all four industry segments reported high awareness and usage of total quality management and benchmarking. And, given quality's roots in the manufacturing industry, it came as no surprise that manufacturing executives report greater awareness of ISO 9000, quality circles, Six Sigma, and Baldrige than leaders in the services healthcare, and education sectors. Actual use of the six techniques across all industries as indicated by survey respondents, however, was considerably lower than reported awareness.

“The sizeable gap between usage and awareness leads me to believe that businesses and organizations either do not use quality methodologies to improve their operations or they just don't realize that the processes they have in place are attributable directly to the quality discipline,” said Case.

A full report of the findings, including industry-specific breakdown of responses and demographics, can be found on ASQ's Web site at www.asq.org/survey/.
The American Society for Quality (ASQ) is the world's leading authority on quality. The 104,000-member professional association advances learning, quality improvement, and knowledge exchange to improve business results, and to create better workplaces and communities worldwide. As champion of the quality movement, ASQ offers technologies, concepts, tools, and training to quality professionals, quality practitioners, and everyday consumers. Headquartered in Milwaukee , the 58-year-old organization also administers the U.S. Commerce Department's Malcolm Baldrige National Quality Award and is a founding partner of the American Customer Satisfaction Index (ACSI), a prominent quarterly economic indicator.

Press Contact:
Chris Lochemes
[email protected]
800-248-1946
March 15, 2004
 
Last edited:
Elsmar Forum Sponsor

Jen Kirley

Quality and Auditing Expert
Staff member
Admin
#2
I choose to think that ASQ's sponsoring this study is not compromisng it like, say, the small group of government sponsored scientists that disagree with the overwhelming worldwide body of scientists on global environmental matters... :rolleyes:

My admittedly unscientific poll of MBAs of my acquiaintance has uncovered no evidence yet that Quality (with a capital Q per Tim Folkert's very nice definition) is being taught to business students. They get some theory, but are not well trained in its deployment until after they hit the work force.

What experience they get is then subject to the practices, good or flawed, of the company (one or more) they work for. GE's Six Sigma has made Quality fashionable again, but true Quality is still a job being done, I dare to say, by someone else. They could also go on to any number of business specialties (like finance) and drift away from Quality completely.

I recently read of a summer course titled Breakthrough Customer Satisfaction at Harvard Business School. That's progress, I think.

So, no, the survey results do not surprise me at all.

Do the same survey around here and I think I know how it will turn out, sigh.

Jennifer
 
Z

ZeeMan

#3
What executive in his/her right mind is going to say that they don't believe that Quality has an impact to their business? They may as well just tear up their ISO certification letter on the spot. That's like asking "Do you think companies should behave ethically?" I'd be more interested in a breakdown of the 1% who didn't think Quality affected their bottom lines.

Asking a non-question like that leads me to think that ASQ might have - just maybe - had a particular agenda in mind for the survey...

Here's some more great survey questions:
Do you think the economy affects your business?
Do you think weather affects farming?
Did you know your Mom hates you?
 
Last edited by a moderator:
R

Rob Nix

#4
I thought the same thing when I read Wes's post (moments ago) Zman. What an underwhelming sense of the obvious!

It is like the statement that 9 out of 10 dentists prefer sugarless for their patients who chew gum. Only that one dentist knows where his paycheck comes from. :tg:

And after attending the ASQ AQC for the last few days, and hearing Ken Case and others speak, my confidence level has not improved dramatically.

Most of the discussions were either touchy-feely (e.g. "the human side of six sigma") or debates regarding definition. But I did learn that, yes indeed, my mom loves me.

NOTE: There were some very good presentations at AQC as well.
 
Z

ZeeMan

#5
I'm glad I'm not the only one, Rob. I find logic - at least in my market segment - tends to be an ill-regarded and under-utilized tool.

I suppose that Wes probably already had that thought in mind when he made the post, so I'll try to take a stab at the other content.

My experience is that executives are not in the business of having an opinion on quality. They're in the business of making the Board of Directors happy who, in turn, are in the business of making the shareholders happy. While I'm sure they're all aware of quality issues and programs and the like, they will err on the side of making money when push comes to shove. If that means allowing product out the door to make sales projections for the quarter, even though they know they'll see those products returned for repair in a month or two, they'll do it. That gives them a couple of months to figure out how to make next quarter's sales.

I recently took an ethics course at a local college. It was interesting in that it dealt less with ethics from a business standpoint than it did from a philosophical standpoint. It got me thinking that quality - in many regards - is the corporate morality police. We have to make sure that we're doing the 'right' thing (from a customer's perspective; from a company's longevity perspective) even when it is hard for the company to do so in the face of other enticements - like getting paid now.

My hope is that our continuing effort will not so much change executive's minds, but help shareholders understand how a dedication to quality is a fundamental tool in assuring the long-term profitability of their investments. If we do that, it'll filter down to the executives faster than you can say Taguchi.
 

Wes Bucey

Quite Involved in Discussions
#6
Underwhelmed by ASQ staff & elected officers

Rob Nix said:
I thought the same thing when I read Wes's post (moments ago) Zman. What an underwhelming sense of the obvious!

It is like the statement that 9 out of 10 dentists prefer sugarless for their patients who chew gum. Only that one dentist knows where his paycheck comes from. :tg:

And after attending the ASQ AQC for the last few days, and hearing Ken Case and others speak, my confidence level has not improved dramatically.

Most of the discussions were either touchy-feely (e.g. "the human side of six sigma") or debates regarding definition. But I did learn that, yes indeed, my mom loves me.

NOTE: There were some very good presentations at AQC as well.
The one thing I can bet without having been present is that the "very good presentations" were NOT by ASQ staff or elected officials. How about it, Rob?

Frankly, I would have thought this little piece would have drawn many more posts dripping with sarcasm and scorn for
  • the fact the "full" report is only a series of PowerPoint slides - no details
  • the fact the report didn't indicate the expertise of the polling company (none is obvious to me)
  • The "dumb factor" of the questions (thanks, Zeeman!)
I had an interesting conversation last week with several of my wife's fellow graduates (she just got a Masters degree early in May.)
They were all hooting over the "customer satisfaction survey" they received from the University which was loaded with self-serving "forced" answers on a number scale 1 - 10.

We all hooted at different things:
  • I couldn't restrain my absolute scorn for the incredible number of grammatical and wrong word choice errors.
  • Uniformly, the graduates were appalled that there were only multiple choice or graph answers allowed - no essay questions.
  • They wanted to be heard as individuals, not as statistical blips.
Yet, if 2 per cent of the graduates are toadies who complete the survey with high scores, the University will tout the results as if it represented the feelings of the entire class.

It's been so long, I forget whether the ASQ survey indicated how many surveys went out versus how many were returned. What kind of followup did the poller do to get responses in the door? What level were the executives who purported to fill out the survey? Did a staffer fill it out for the exec? I sure would have preferred some raw data to sift for myself.

In my own experience with hundreds of folks in the executive suites at various employers, customers, and suppliers over the years, I can tell you that 100% would answer "yes" if asked if Quality were important in their company. If asked to list the most important factors for their companies without any other prompting (definitely NO list of choices!), I doubt Quality would rank in the top ten for those same executives.

Back during the Eisenhower presidency, it was a common "knowledge" that to get hired at any major American corporation, all you had to do to survive the interview was to remember that every answer had to reflect a strong belief and faith in God, Mom, the American Flag, and apple pie. Vegetarians were as bad as Communists, no degree was better than one from a radical campus like Berkley, and you could drive any car you wanted, as long as it was American.

Sometimes, when I see executives and whole industries marching in lockstep, I wonder if we've progressed one iota from those repressive times.

Deming must be spinning in his grave at all the fear that reigns rampant in industry and life in general today. Some recent headlines of jailing folks without due process reminds me of those terrible years of McCarthy's witchhunts when a mere whisper of "communist" or "homosexual" could get someone blacklisted for life.

The big question to answer is always, "Who benefits from 'dumbness' and fear? There are two ways to deal with dissent when implementing a change in any process:
  1. convert the dissenters through reason, logic, and even rewards
    or
  2. eliminate the vocal dissenters and control "closet dissenters" through fear they will be also eliminated.
Why do so many organizations seem to choose option 2?
 
B

Bill Pflanz

#7
ZeeMan said:
I recently took an ethics course at a local college. It was interesting in that it dealt less with ethics from a business standpoint than it did from a philosophical standpoint. It got me thinking that quality - in many regards - is the corporate morality police. We have to make sure that we're doing the 'right' thing (from a customer's perspective; from a company's longevity perspective) even when it is hard for the company to do so in the face of other enticements - like getting paid now.QUOTE]

If we are acting as the corporate morality police then that explains why we are sometimes ignored. Defining quality is a lot like defining ethics. Ethics are personal and generally learned early. Doing the right thing means something different to different people. We may not agree with the ethics but there are executives that believe making money for the company is more important than any other issue.

I am not defending unethical executives, but just noting that they have made a personal decision about their ethics on what is right. As shown by the numerous postings on dealing with management, getting them to change their beliefs about quality's importance is not any easier than getting someone to change their ethics.

Good discussion thread.

Bill Pflanz
 
C

Craig H.

#8
Bill

I agree that it is a question of ethics, but all of us are influenced by our surroundings. Lets look for a second (at least from my view, fire away if you disagree) at just what kind of environment executives at public corporations exist in.

It is true that they answer to the board, and through the board, to the shareholders. They also answer (to a lesser degree) to entities such as the SEC. One thing that seems to me to be somewhat common to these entities, and something oft forgotten, is the role the brokerage firms and stock exchanges play.

They make money primarily when stock (and other instruments, but lets focus on good old common stock) is bought or sold. It is in their interest, therefore, to maintain as high a degree of volitility as possible within the markets (at least just up to the point that all confidence is completely lost, a la 1929) because the volitility spells stock sales /purchases which equals profit. The way to generate this volitility is to focus on the short term, ignoring statistical realities (such as a process being in control, maybe?). Am I making too big a jump if I compare this to Deming's tampering?

So, the force that at least encourages a short term viewpoint, the focus on next quarter's numbers, is motivated by the desire for profit by the brokerage houses and their allies.

How many shares of these are publicly traded?

Executives walk a tightrope, much like politicians. They would be foolish to take a negative stand against anything the represents "goodness". If you were to ask them how important their employees' diet is to the success of the company, does anyone here think a single executive would say "its not important", even as the Twinkees (sp?) roll out their door? To their mind, I believe that their main ethical challenges are to make shareholders a profit and stay in business. The playing field dictates that they focus on the short term numbers, or the long term questions are moot.

As far as ASQ being involved, I wish I could say I was surprised. Anyone else here think our new, enhanced (read: increased) membership fee structure is being put to good use junk (spam) mailing post cards for the latest book release? ASQ, give me a break please. You are becoming the thing we most despise.

Craig
 
Z

ZeeMan

#9
OK. I think we've got agreement that we (Quality) are going to have a different point of view than that of our executives due to different pressures that shape dissimilar criteria for what is "good". Working these things around in our heads to try and better understand why we are where we are is a good thing.

But my question is: what do we do about it?

How do we align the two versions of "good"? I recently posted a comment on the ASQ site regarding an article in a recent QP that discussed the importance of 'talking quality in the language of finance.' It was a Cliff Notes version of a standard finance course, describing ROE, ROI, EPS, etc. It said nothing of HOW to translate quality issues into that language. To me, it was useless.

The problem I struggle with is that if we fix a defect, we have no way of knowing how much it would have cost us if it had not been fixed. And trying to correlate effect back to cause is not much easier when you're talking about advanced electronics that have thousands of functions.

Have any of you had success with translating the prevention of defects to reduced costs? It seems that's the only way to 'talk quality in the language of finance.'
 

Wes Bucey

Quite Involved in Discussions
#10
ZeeMan said:
OK. I think we've got agreement that we (Quality) are going to have a different point of view than that of our executives due to different pressures that shape dissimilar criteria for what is "good". Working these things around in our heads to try and better understand why we are where we are is a good thing.

But my question is: what do we do about it?

How do we align the two versions of "good"? I recently posted a comment on the ASQ site regarding an article in a recent QP that discussed the importance of 'talking quality in the language of finance.' It was a Cliff Notes version of a standard finance course, describing ROE, ROI, EPS, etc. It said nothing of HOW to translate quality issues into that language. To me, it was useless.

The problem I struggle with is that if we fix a defect, we have no way of knowing how much it would have cost us if it had not been fixed. And trying to correlate effect back to cause is not much easier when you're talking about advanced electronics that have thousands of functions.

Have any of you had success with translating the prevention of defects to reduced costs? It seems that's the only way to 'talk quality in the language of finance.'
Well! I'm beginning to feel better about this thread, already.

When we talk about leading executives "kissing axes" for the sake of stock prices, please consider two of the most phenomenally successful execs of modern times: Warren Buffett and Bill Gates.

Buffett was recently quoted: Says he's "disgusted" by corporate bosses who tout their companies while selling shares: "These business leaders view shareholders as patsies, not partners." Buffett has never sold a share of Berkshire Hathaway.
Makes you wonder why executives don't follow the models of two of the world's richest men, doesn't it? Neither of these guys makes corporate decisions based upon what Wall Street thinks.

What can we do about it? It seems to me we should point this out to our own executives at every opportunity. Add the little stinger, "What do these rich guys know about running a successful business that we don't?"
Buffett recently got hammered by losses in his reinsurance business because he made a miscalculation in the effects of terrorism and hadn't raised premiums sufficiently to cover payouts. Result? Stockholders kept buying and raised the price of his stock 10% because they had faith in the long term! Actually, faith in Buffett's long-term vision and the ability of the company to carry it forward even if he (an old man) dies!

The reality is that we don't need to talk the esoteric terms of ROE, ROI, EPS, etc. We really need to turn the talk to the long-term survival and success of the organization.

We need to talk about things like
  • succession plans (McDonalds had two top executives in a row stricken, but with a succession plan in place, the stock market barely quivered.) The time of the cult of one invincible leader has passed. Without adequate succession plans, you end up with companies like Sunbeam who wallow in the mire after suffering the debacle of "Chainsaw" Albert J. Dunlap.
  • determining what business we're really in Railroads missed their golden opportunity when they stubbornly refused to consider they were in "transportation" instead of "railroads" and so missed out on the chance to invest in and dominate automobile and airline industries.
  • believing our lip service that "people are most important resource" Too often, corporations treat their employees as fungible commodities versus custom products. Executives routinely engage in mass layoffs of thousands of folks, reasoning "we can always get more if we need them." (The corollary is equally disturbing: folks begin to think of themselves as replaceable.) Executives should think, rather, of expansion into other businesses or markets where the workforce can be profitably employed. Too often, the short term profit is really only a saving at the expense of the workforce, not true efficiency.
  • really relating and partnering with customers and suppliers Anybody out there feel the automotive industry is really "partnering" with its suppliers? Or is it more like "exploiting?"

 
Last edited:
Thread starter Similar threads Forum Replies Date
A Executives Search and Selection (ESS) firms for Quality Professionals Career and Occupation Discussions 0
T Quality Professionals as Executives ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 35
T Quality Professionals as Executives General Auditing Discussions 6
M An outline for a Total Quality Management programme to present to senior executives Preventive Action and Continuous Improvement 9
N Guidance - Cost of Good Quality Misc. Quality Assurance and Business Systems Related Topics 2
D Quality plan for moving locations ISO 13485:2016 - Medical Device Quality Management Systems 3
was named killer Job Opportunity-Quality Engineer-Tampa Florida Job Openings, Consulting and Employment Opportunities 0
Marc Job Opportunity – Quality Assurance Specialist - Suspense 7 April 2021 Job Openings, Consulting and Employment Opportunities 0
C Requirement to link Quality Manual to ISO 9001 clause numbers? ISO 13485:2016 - Medical Device Quality Management Systems 13
normhowe "The Problem with Quality Management: Process orientation, controllability and zero-defect processes as modern myths" Book, Video, Blog and Web Site Reviews and Recommendations 2
J Quality Objective for QMS prior to Certification AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 8
J Quality Objectives and resources ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 11
M PSA Suppliers - CSR matrix and need the quality manual of PSA APQP and PPAP 2
A Quality Control Datasheets Inspection, Prints (Drawings), Testing, Sampling and Related Topics 0
T Quality auditor legal right to see Board meeting minutes ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 12
D Any recommendations on where to find experienced quality hires in Chicago area? Job Openings, Consulting and Employment Opportunities 3
C Budgetary cost to obtain ASME NQA-1 Quality Program Certification Quality Management System (QMS) Manuals 0
O Soft and technical skills for a VP of Quality Career and Occupation Discussions 1
P MedWatch Report from a hospital due to a quality issue US Food and Drug Administration (FDA) 5
Sidney Vianna Release of ISO 10013:2021, Quality management systems – Guidance for documented information Other ISO and International Standards and European Regulations 0
M Unique Quality Management System for 2 sites ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 5
G Application to Chartered Quality Institute - MCQI ASQ, ANAB, UKAS, IAF, IRCA, Exemplar Global and Related Organizations 2
K Quality Agreement MDR - The manufacturer is outside of EU Other Medical Device Related Standards 4
Sidney Vianna Informational APQP4Wind - Advanced Product Quality Planning for the Wind Power Supply Chain APQP and PPAP 3
T 21 CFR 820.20 - Quality Planning Requirements? 21 CFR Part 820 - US FDA Quality System Regulations (QSR) 2
S Supplier protocol for the Quality Supplier Quality Assurance and other Supplier Issues 6
bruceian Software Quality Metrics Software Quality Assurance 11
R Quality System Functional Safety Checklist / Guidance IATF 16949 - Automotive Quality Systems Standard 0
Bev D Essential References for Practical Quality Engineering Misc. Quality Assurance and Business Systems Related Topics 0
optomist1 Automotive News The Cost of Inspecting In Quality IATF 16949 - Automotive Quality Systems Standard 7
O Any info on release date of FDA “Computer Software Assurance for Manufacturing and Quality System Software” document? 21 CFR Part 820 - US FDA Quality System Regulations (QSR) 0
M Quality Manual - Where does Revision History Section go? Document Control Systems, Procedures, Forms and Templates 8
John Broomfield CIOB - Code of Quality Management Misc. Quality Assurance and Business Systems Related Topics 1
S Quality Audit Training Activities Quality Manager and Management Related Issues 2
D Are Supplier Quality Agreements Quality Records ? Other Medical Device Regulations World-Wide 9
D Big companies suffer from quality management system? ISO 13485:2016 - Medical Device Quality Management Systems 1
K Looking for a job as Quality Engineer Career and Occupation Discussions 2
B Two excellent examples of process capability analysis from Quality Magazine Capability, Accuracy and Stability - Processes, Machines, etc. 5
Pau Calvo Quality Management process is mandatory in ISO9001? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 10
NDesouza No Quality Professional vs Having a Quality Professional Benchmarking 24
F Does anyone have an ESD quality/cooler talk to share? Training - Internal, External, Online and Distance Learning 4
R Monitor production quality - Internal KPIs Manufacturing and Related Processes 5
U Examples of Quality Objectives for a Medtech start up ISO 13485:2016 - Medical Device Quality Management Systems 4
M SemaTech SSQA Standardized Supplier Quality Assessment - my favorite tool ever Manufacturing and Related Processes 1
D Supplier Quality level category help - high level ISO 13485:2016 - Medical Device Quality Management Systems 6
R How would you work without a quality management system? IATF 16949 - Automotive Quality Systems Standard 3
P Conformity assessment based on a quality management system or production quality assurance EU Medical Device Regulations 3
H Updating Quality Manual to API Q1 Service Industry Specific Topics 6
R Electrical contractor Project Quality Management Plan Quality Manager and Management Related Issues 1
D Supplier Quality - How to classify a supplier level Medical Device and FDA Regulations and Standards News 10

Similar threads

Top Bottom