Monday, March 15, 2010

Quality Methods Take Business by Storm; Whats Next?

Quality Circles, Total Quality Management, ISO 9001, QS9000, Baldrige, Six Sigma, Lean. All of these methods have at one time had lots of attention in the press and in the Quality profession. Looking back on these methods and their moment in the sun, I have one (maybe more than one) observation. All of these methods are valuable and have had major impact through disciplined application in a number of different companies but the one thing that strikes me is that all of these methods have been touted as a savior for all of our quality woes.
Quality Circles were the thing in the 70's and 80's as America struggled to catch up with quality advances made in Japan under the tutelage of Dr. Deming. ISO 9001 took off in Europe and Asia first but steadily gained momentum in the US in the 90's as more and more international companies started to make it a condition of business. The 80's and 90's saw the excitement about possible benefits of achieving the Malcolm Baldrige National Quality Award. Much was made of stock indexes based on the Baldrige winners beating the S&P 500 by significant margins. Many of us lived through the PR assault for Six Sigma created by Jack Welch at GE and others. Dramatic claims were made about savings achieved using six sigma, attracting lots of media attention. Lean has been slowly but surely gaining adherent over the years as Toyota continues to perfect the method and tools that has led to the elimination of millions of dollars in waste around the world
I think this is an interesting parallel to what we have seen here in the US in the last 30 years when we think about the stock market. Many of these companies have been doing things well for years and they just happen to do it using lean, or six sigma, or ISO 9001, or Baldrige, or Quality Circles. People start to hear good things about this companu or that and what they are doing with Baldrige and how their stock price is up compared to everyone else and suddenly, everyone starts to thign that the secret to success is the quality method du jour. Then of course everyone wants to learn about the method and pretty soon, just like preppies in the 80's, everybody is doing that sexy new quality method and looking for the big payoff. Some find it, others don't. Which is just additional proof that its really not the method as much as the culture of the organization attempting to employ it.

Back to that interesting parrallel I mentioned before. I have been a working adult through the last two recessions (2008-Present, and 2001-2002) While I was not a working adult during the recessions in 1979-81, or 1987, I do remember them well and I think there is an interesting difference between these era's that relates to our attitude about quality. The recessions of 1979-81, and 1987 were what I would call "normal" recessions. Normal in that they were caused by normal economic factors such as inflation, failure to compensate for changes in economic conditions, oil shortages, conflict, etc....The recessions of 2001-02 and the present one are different from the others in that they have been primarily caused by irrational speculation coupled with poor business discipline. Not since the Great Depression has speculation caused so much upset in the world. Seems the old saying is true, those that dont learn from history are doomed to repeat it.

OK, so what does all this have to do with Baldrige, Lean and Six Sigma? They are parrallels for our experience in the markets, sexy methods that were going to come in like white knights and save us boatloads of money. Baldrige winners were supposed to outperform the S&P 500 by significant percentages, ISO 9001 was going to keep American companies in business, and of course, Six Sigma saved the day at GE, Allied Signal and others in the 90's. None of this is false information, all of these things happened. So why is it that every company is not going for Baldrige, or applying Six Sigma or Lean? Why are none of these the silver bullet once claimed? Basically, it comes down to what really matters and what we should be focused on: Quality Fundamentals. Quality Fundamentals or those things that help a company delight customers, drive continuous improvement, and enable excellence. Whether you call it ISO 9001, Baldrige, Six Sigma, or Lean, those are the things that matter most.

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