Quality in business has never mattered more, say Ashwin Srinivasan and Bryan Kurey, writing for Harvard Business Review.
As the authors point out, online customers can compare products from all over the world, consumers can find objective data on the World Wide Web and read user-generated reviews. When users are unhappy with products or services, they use social media to tell the world about it. As many as 75% of B2B customers rely on word of mouth when making purchase decisions.
These sources provide an “early warning system” for quality problems, observe Srinivasan and Kurey. However, they also point out that although the margin for error has decreased, the likelihood for error has increased, with cycle times compressing, output gains outpacing employment growth and employees finding it hard to keep up with demand.
The authors comment: “As a result of these pressures, managers must find a new approach to quality – one that moves beyond the traditional ‘total quality management’ tools of the past quarter century.”
At CEB, Srinivasan and Kurey’s consultancy, a two-year study was carried out exploring how organisations can create a culture in which quality is embedded in employees’ actions – “where they are passionate about quality as a personal value rather than simply obeying an edict from on high”.
The authors define a true culture of quality as “an environment in which employees not only follow quality guidelines but also consistently see others taking quality-focused actions, hear others talking about quality, and feel quality all around them”.
Having interviewed the quality function leaders at over 60 multinational corporations and surveyed more than 850 employees, Srinivasan and Kurey express surprise at some of what they have learned.
For example, many of the traditional strategies for increasing quality, such as sharing of best practices, training and monetary incentive, have little effect. Instead, a grassroots, peer-driven approach to develop a culture of quality results in fewer mistakes – and, therefore, less time and money spent correcting mistakes.
However, Srinivasan and Kurey insist that companies should not abandon the traditional tools – but rather than use them as the foundation for a true culture of quality, they use them to support rules-based quality measures.
The authors have identified four attributes that accurately predict a culture of quality:
1) Leadership emphasis. Managers are told that quality is a priority of leadership, and they “walk the talk”. The importance of quality is emphasised when managers evaluate employees.
2) Message credibility. Respected sources deliver messages which are consistent and easily understood. Employees find that communications appeal to them personally.
3) Peer involvement. Employees have a strong network for guidance from peers. Quality is routinely raised as a topic for team discussion, and peers hold each other accountable.
4) Employee ownership. Employees understand how quality fits in with their job and they are empowered to make quality decisions. They are also comfortable about raising concerns regarding quality and challenging decisions that detract from it.
Srinivasan and Kurey discuss the clear actions that can help companies improve in each of the four areas:
• Maintaining leadership emphasis on quality. Srinivasan and Kurey describe how Seagate, a $14 billion provider of media storage solutions, uses a number of mechanisms for executives to spot inconsistencies between their actions and decisions and the company’s cultural aims.
First, company leaders agree on what constitutes the ideal culture and the behaviours that would enable it.
Then, the quality and HR teams compare their definitions of ideal culture with the observations of employees, revealing areas for improvement.
Leaders then attend workshops to help them identify behaviours that might hinder the ideal culture.
• Ensuring message credibility. Although most companies communicate the importance of quality to their employees, their efforts are in vain if the messages aren’t believed.
Beverage firm Diageo overcame the difficulty of communicating credible messages to 21,000 in disparate locations. The company identified four distinct groups of employees with regard to what drives hard work, and tailored quality messages for each one. Local managers chose whichever campaign they thought best suited the employees at their site.
• Encouraging peer involvement. Western Digital company HGST uses positive social pressure to encourage its employees to generate quality initiatives.
Posters are displayed reminding everyone of the importance of quality, and managers publicly evaluate employees’ quality-improvement projects.
The company also organises friendly quality competitions to encourage ideas and collective pride.
• Increasing employee ownership and empowerment. Chewing gum manufacturer Wrigley writes “quality in action” guidelines, helping employees understand what the company expects.
It also creates opportunities for employees to observe actions that breach the guidelines, and holds brainstorming sessions to identify root causes of mistakes and devise corrective actions.