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  • 8/9/2019 Ten Mistakes Ceos Make About Quality

    1/6

     

    nsights

    from

    Baldrige

      ward

    winn ers and

    top

    quality

    firms

    by

    Willard

    I

    Zangwill

    HE WINNERS OF THE MALCOLM BALDRIGE

    National' Quality Award and other fmns

    noted for excellent quaJity programs

    think differently about quality than most

    firms. A professor

    of

    management sci

    ence and students,at the University of Chicago

    interviewed executives at a number

    of

    firms that

    have excellent quality programs. These interviews

    revealed 1 mistakes thatmany corporate executive

    officers (CEOs) make that inight prevent their com

    panies from   e v ~ l o p i n g excellent quality programs.

    Mistake   Failing to

    lead

    When CEOs strive to be leaders and to inspire

    their employees to excel, many adopt an approach

    that almost always fails. They recall movie scenes

    in which great leaders give powerful and highly

    motivating speeches, such as Knute

    Rockne inspiring his football, team or

    Gen. George' Patton spurring his troops

    to success. Leadership to these CEOs

    becomes management by exhortation

    and inspiration. Speeches, high goals,

    slogans, and campaigns are supposed

    to motivate employees and propel the

    organization toward competitive victory

    This misguided Hollywood style

    of

    leadership almost always

    fails.

    Jack Stack EO

    of

    Springfield

    . Remanufacturing, which remanufac

    tures engines in Springfie ld

    MO,

    recalls when he took over a division

    and gave a powerful speech designed

    to

    rouse and inspire the workers. At the

    end of the speech, he asked if there

    were any questions, and one worker

    in the back yelled out, How old are

    you, anyhow? The workers had often

    been exhorted with motivational

    speeches and campaigns, slogans, and

    goals. They were cynical because of

    repeated failures and knew from experi

    ence that little real change would occur

    Although speeches and exhortations

    might produce.a brief flurry of

    activity,

    soon p o p ~ o back to the same man-

    agement, systems, and procedures as before.

    Repeatedly, CEOs make speeches, set goals, wage

    a big campaign, and then wonder why this leader

    ship produces little lasting change.

    Movies, in an effort to create a dramatic effect,

    confuse the issue. Prior

    to

    their speeches, Rockne

    and Patton thoroughly planned

    .

    organized

    equipped, trained, and prepared their men. That

    was the main substance

    of

    their l e ~ e r s h i p and cre

    ated the success. The motivational speech was the

    final encouragement and, perhaps, was not even

    necessary.

    Good leadership must produce results, which

    means that the actual work done in the offices or

    factory must change. Exhortations rarely accom

    plish that. Change requires a new infrastructure in

    which the organization's steps, procedures, and

    Quality

    Progress  une

    1994

     

  • 8/9/2019 Ten Mistakes Ceos Make About Quality

    2/6

    ~ e c l m i 9 e s a r e i m I ? f ~ v e d

    This

    i e q u i r e ~ new

    systems,

    plarming,

    mcentlves, and trammg. Improvement in the·way work is done

    is what quality systems accomplish and is the substance

    of

    real

    leadership.

    Mistake

     

    Thinking

    th i planning

    devolves from

    financial or

    marketing

    goals

    ~ l a r m i n g · i n many organizations, starts with top management

    settmg goals for financial growth (profit, earnings per share, and

    return

    on

    investment) and market growth (sales). These overall

    financial and sales goals then

    get

    broken down into specific

    goals and budgets for each department or area.

    What is often neglected in these goals, however, is the cus

    tomer, who

    ~ k e s

    the purchase and pays the bills. Planning

    should start

    WIth

    the customer, and the centerpiece of plarming

    should

    be

    customer satisfaction. This is true

    of

    the Baldrige

    Award winners.

    Westinghouse

    Commercial

    Nuclear

    Fuels

    Division, for example, has quality goals that.directly relate to

      ~ s t o m e r

    satisfaction issues. The senior management level has

    eIght goals, which are divided into subgoals in lower levels

    of

    the organization. Even the individual worker

    or

    work team has

    goals that relate to the overall customer satisfaction goals. Each

    month, Xerox Business Systems sends out 40,00psurveys to its

    customers and to people who bought from the competitors, and

    the data from these surveys strongly influence corporate goals.

    ~ o t o r o l .has overa:ching goals for improving quality and cycle

    tIme, whIch are dIrectly derived from customer satisfaction

    issues. All of the Baldrige Award winners examined, such as

    GlobeMetallurgical, IBM Rochester,· and Federal Express, have

    systems to ensure that customer satisfaction drives their goals. .

    P e t e r s o ~ Products, a metal stamping firm near Chicago, IL,

    was about to launch a marketing campaign to elevate sales.

      n s t e a ~ i t d e c i d e d

    to

    improve on-time delivery to the customer.

    When the percentageof o n ~ t i m e delivery went up, the salespeo

    ple.were ecstatic because for the first time they could promise

    delIvery. Sales rose.25  because the customers.were getting

    what

    they

    wanted, and Peterson

      was

    able to drop the plan for

    the marketing   m p i g n ~

    Another example is Cooper Tire in Findlay, OR. Building a

    reputation as a reliable supplier with modem plants, it aimed its

    marketing. directly at the customers. It has doubled its market

    share and enjoys

    a·profit

    growth rate

    of  

    pe r year

    According to

    th w

    York imes it is the envy

    of

    giants like

    Goodyear, Bridgestone, and Michelin.

     

    In

    most

    firms, planningis a vertical process that is driven

    from the top down

    or

    from the bottom up. Planning should

    be

    a

    horizontal process, however, starting from the

    customer

    and

    working inward. Financial goals are also necessary,· but

    the

    cus

    tomer

    should

    drive goal-setting process, and every depart

    ment.and functional group should have goals that positively

    .affect customer satisfaction. As

    Bob

    LaBant,

    IBM

    vice·presi

    dent,· said,· My·goal is .to· make our customers successful.   I

    had onemeasure, i twould

    be

    their success. 3

    Mistake   elieving

    that

    being

    close

    to

    thie

    customer

    and

    planning

    for customer satisfaction issuni ient

    . ..The .top executives

    at

    many companies believe

    that

    their

    firms have a strong customerfocus. They might have oriented

    t h ~ i r planlling_ sys tems to better. satisfy.

    the

    customer.

    They

    mIght·

    also

    maIntaIn complaint·hotlines, have extensive war-

    44

    Quality Progress

     

    une

    1994

    ,ranties, and conduct customer satisfaetioll surveys.  h s te

    ·niques, while helpful, still do not constitute·a total custom

    focus· because customer satisfaction is not something that c

    cerns only some parts

    of

    the firm. Each and every group

    in

    firm should have goals and incentives that are tied into enha

    ing customer satisfaction. This requires a carefully conceiv

    management system that

    involves

    all

    p·arts

    of the firm

    improving customer satisfaction.

    Why

    is this done so infrequently? Perhaps themost pervas

    reason is that many companies lack a systematic approach

    customer satisfaction. The executives believe that a system is

    needed

    and

    that they already understand the customers a

    know what they want. Almost always, however, that belie

    false. Motorola, for example, is well aware of thi s f ac t a

    requires its executives to visit its customers firms. The exe

    tives are required to speak notjust to the firms executives,

    also

    t? the

    workers who actually use the

    Motorola

    produ

    Expenence has shown that almost everyone has distorted id

    about what customers truly think, and a systematic approach

    needed to overcome this.

    Steps to

    overcome

    the problem

    Row should such an approach be developed? The first step

    to

    conduct an

    analysis of all of the interactions a

    custom

    might have with the organization. Most organizations coll

    cust

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