UK: PUTTING THE TOTAL INTO TOTAL QUALITY.

UK: PUTTING THE TOTAL INTO TOTAL QUALITY. - Are UK managers keeping up with the spirit of change? The truth comes out in a Vauxhall/MT survey.

by Robert Heller.
Last Updated: 31 Aug 2010

Are UK managers keeping up with the spirit of change? The truth comes out in a Vauxhall/MT survey.

At first sight, and maybe even at second, British industry is in the throes of a quality revolution. The first UK Quality Awards will be announced in November, and will undoubtedly reveal prodigies of improvement. The Awards are organised by the British Quality Foundation, which, after only a few months of active recruitment, has achieved 1,200 corporate members. What's more, the last two winners of the European Quality Award, Milliken and Rank Xerox, have their operational bases in the UK.

A third and closer look, however, raises serious doubts - that is, if Total Quality Management is the objective and the touchstone. Certainly, activity abounds: without doubt, most of the work has a direct and effective bearing on quality. But is it total? And how far is it truly affecting management and the quality of management? One of Britain's largest and best-known high-tech companies is typically chary: while the company has 'many initiatives involving quality approaches', it admits that 'development of its own character and approach to quality' is still on the horizon.

True, total quality is a long journey, and, says Bernard Fournier, managing director of Rank Xerox, 'a journey without an end'. The voyage at his group began with a policy document in 1983: despite a decade of remarkable improvements on every measurable criterion (measurement being the essence of quality processes), the company is continually raising its sights. Fournier likens total quality to 'somebody walking: however far you go, the horizon stays the same distance away.

'When you begin to understand what quality is,' he adds, 'you can be discouraged by the effort you have to make.' What Fournier understands by quality and the general understanding in British management are evidently very different things. Interviewed on behalf of Vauxhall (sponsors of this survey) and Management Today, 46% of a 270-strong sample of directors, senior and junior managers drawn from the FT Top 500 companies, claimed to have a fair knowledge of what's involved in quality improvement, and 24% claimed great familiarity (Tables 1 - 3). But what did the respondents mean by quality?

Not surprisingly, their companies have apparently moved into the new age: more than two-thirds have a quality improvement programme (QIP) in operation (Table 4). The survey used the word 'programme', which is itself indicative. Most companies that are truly and totally committed to quality avoid using 'programme', because of its flavour-of-the-month implications: something that, like countless other initiatives in the past, has its moment in the sun, is finite, and doesn't achieve what TQM seeks - a lastingly different way of corporate life.

Still, the survey is encouraging in that it leaves only a 15% rump completely in the quality dark - though the one company that abandoned its QIP may feel it has entered the light. This single dropout is interesting, however, because it contradicts the widely held idea that quality programmes have disappointed as many companies as they have satisfied. Last year the Economist Intelligence Unit published a report whose headline was strongly negative: 'TQM Programmes Can Be Counter-Productive, Claims New Research'.

The research was done by Ashridge Management College, and its leader commented that these 'programmes - company-wide, training-led add-ons to existing jobs - are at best ineffective. At the worst, they inoculate the organisation against real change.' In the Vauxhall survey, however, the quality impact appears to be strongly favourable, if patchy: more than half of respondents claimed that quality improvement made a significant contribution to achieving business goals (Table 5).

Again, Ashridge and the survey respondents are probably talking about different things. But the thrust of the Ashridge report - entitled Making Quality Work - is that the failures sprang from falling considerably short of total commitment. Without that, companies can't hope to obtain 'the benefits, in terms of competitive edge and profitability, that real quality improvement can bring'. Commitment means 'leadership which makes quality the number one, non-negotiable priority; empowering employees to experiment and make mistakes and find their own ways of improving quality; building quality into the responsibilities of managers; NOT making quality the job of a specific department; providing training on a just-in-time basis, developing skills and knowledge as needed'.

On those five criteria, it's doubtful whether many companies in the Vauxhall survey pass TQM muster. Its tiny proportion of wholly negative experiences may therefore be less encouraging than it looks. Anyway, the discouraging fact remains that 42% of the companies didn't reap the rich harvest which was surely there for the taking.

Did the fault lie with unclear business goals (or lack of them), or with ill-directed QIPs, or both? The survey suggests that a great deal of confusion surrounds these programmes. The adverse tide rises slowly from the 17% of those involved who think quality improvement is 'a lot of hype' (Table 6). Then, twice as many (35%) believe that, outside a few enthusiasts, there isn't much interest. Although 36% approvingly note a lot of interest and activity in their companies, these respondents argue that top management is only paying lip-service and only interested in cutting costs. That cuts to the heart of the issue.

The most favourable statement, agreed to by an impressive 68% of the sample, constitutes a test that any real quality programme must pass: 'Things are really different around here and there is a clear commitment to quality improvement throughout the organisation'. Nothing less will do if a company is to enter the world of total quality. But here the survey shows a significant mismatch. Only 28% of the programmes use the term 'total quality' in any of the possible forms (Table 7).

A rose by any other name, of course, will smell as sweet. Many companies (45%) prefer their own choice of rallying calls, though these tend to be unrevealing: 'quality assurance' (a technical term, tangential to TQM), 'continuous improvement' (pinched from the Japanese kaizen), 'quality management' (conspicuously omitting the 'total'), 'customer focus' and 'service first' (both cliches). Some programmes are unnamed, which must cast some doubt over whether they are programmes at all.

Only 10% of the study are convinced that their version is the true milk of TQM: another 70% think it's 'very similar' or 'similar' to the TQM approach - and many of them are undoubtedly deluding themselves (Table 8). The problem starts with the name. 'Total quality' is a misnomer in one vital respect: the associations of the word 'quality'. Everybody understands quality in the sense of how well-made a product is or how well a service is delivered. But that understanding is very far from sufficient.

By now, most people in manufacturing go beyond this understanding to the awareness that quality of process is fundamental: the gold at the end of the rainbow is defect-free manufacture, not just delivering a defect-free product. You don't achieve 100% quality by inspection, but by elimination of defective design, engineering, components and assembly. This is the area where most progress has been made in Britain; every major manufacturing country has been trying, in varying degrees to catch up with the pioneering Japanese standards.

It isn't just a question of attitudes, either. Getting to 'six sigma' (3.4 defects per million parts) involves the use of specific quality tools right down the line - which makes it very odd that while 95% of the study were aware of 'total quality', a mere 9% knew about 'the PDCA cycle' (Table 9). The oddity is especially great because that technique is fundamental to the teachings of the great, late W Edwards Deming, of whom 38% claim to be aware (Table 10). Indeed, the PDCA cycle (which stands for Plan, Do, Check, Act) is also known as either the Deming Cycle or the Shewhart Cycle (after the great man's own mentor). The answers confirm the suspicion that a vast gulf exists between a relatively small number of companies (led by Rank Xerox, Milliken, etc) which are truly revolutionising their activities and the large number which are mostly making worthwhile but piecemeal advances in some aspects of their operations.

To members of the British Deming Association (which helped compile the questionnaire for the Vauxhall survey) that represents, not only fundamental misunderstanding, but a guarantee of failure. While differences exist between the Demingites and other schools of quality thought, all believers in total quality would agree on the following truth: at the simplest level, there's limited value in obtaining virtually defect-free production at faster rates of output if the processes of getting and delivering orders remain just as cumbersome as ever.

Any book on quality contains examples of stunning progress in this or that operation within companies whose overall results are depressingly poor. The core of Deming's philosophy is that you obtain improved performance by raising the level of the whole system, not just the performance of the individual worker. His devouring interest was in performance in the broadest possible sense, not in 'quality' alone. Just as it's self-defeating to speed output without speeding the whole end-to-end process in the entire business system, so it is pointless to have magnificent systems delivering products or services that the customers don't want. That basic truth, too, has been seized by companies, although management by lip-service is widely practised. Few firms go beyond customer surveys, and many don't go that far. Fewer than half the firms in the Vauxhall study monitored customer satisfaction, and only 6% used customer satisfaction surveys to measure the success of quality improvement.

When it comes to the customer insisting on a quality improvement programme (Table 12) the manufacturing figure is a none-too-convincing 16%: half of the suppliers involved are liable to find a customer insisting now and again. Exactly the same scattered penetration is shown by relations with suppliers. The percentage of manufacturers who say that almost all their suppliers are involved in quality improvement (18%) is slightly less than those who haven't the foggiest idea (Table 13). But in true TQM, it isn't the supplier who volunteers continuous improvement in quality or the customer who insists on it: the total quality firm does the insisting.

Declarations about satisfying or delighting the customer, even when backed by measurement, aren't enough, though. In total quality, every activity has to be weighed against its part in achieving the ultimate objective. But that won't be reached unless the aim is shared by employees who are fully as satisfied as the customers. Meeting the objective in itself helps to create satisfaction. But the total quality logic leads remorselessly to far-reaching changes in how managers manage.

The shift is basically one away from command and control (or order and obey). Many managers can't make the move. At Honeywell UK, which launched into TQM in 1988, the change at the Newhouse plant was led by Tom Frame: 'A number of managers', he found, 'were administrators - they had forgotten leadership.' Some loved being questioned by their workforce in interactive workshops, and so on. Others couldn't take it: six months after the start, five of the 11-man management group had departed.

The traditional diehards in middle management can also be disturbed by the change. But opposition is at least equally likely at the summit, where senior executives may be deeply uncomfortable with the plain necessity to challenge their own processes and functions - and more than uncomfortable with the training that is integral to TQM. The survey shows that 46% of directors had received some quality improvement training: but half of these for three days or less (Tables 14-15).

To quote the survey: 'Those who received no training at all are not convinced that it is required - 59% claimed that they did not need any (Table 16). The more senior in the company, the more likely they are to believe this.' How can top managers expect others to invest their time wholeheartedly in a practice which top management itself avoids? The question has far broader implications. 'Don't do as I do, do as I tell you' is poor quality management even in a command-and-control culture. It negates the very possibility of total quality.

Senior recalcitrance doesn't, of course, rule out progress altogether. In management, the economics of competition enforce change - multi-functional, concurrent project work, for instance, isn't a theoretical option, but a practical necessity. It's also the way that quality improvement teams operate, even in companies where quality is seen in a limited context - but where the necessity for quality improvement is competitively obvious. That especially applies to manufacturers. Not surprisingly, their people, the survey shows, got longer training than service managers: and half of the manufacturing people wanted more still. In general, service businesses lagged behind manufacturing, and non-production departments behind production-related ones in the latter - and by very significant, indefensible margins. It's also significant that more directors and (to a lesser extent) senior managers express confidence in their own awareness of quality improvement issues than do junior managers. Yet almost everybody questioned agreed with the proposition that quality means 'continuous improvement involving everyone in the organisation'.

Plainly, a mismatch exists between words and deeds. TQM could be defined as a sustained effort to close that gap, to align the performance of an organisation with its promises - to its customers, to itself, and to all its people. In every case of real commitment to total quality, that has meant wholesale, radical change in 'the way we do things round here'. That change has been tackled in companies as large as British Telecom and Royal Mail, as different as BA Engineering and Honeywell - and generally the ultimate response from management, workforces and customers has been near-total in enthusiasm.

All the companies mentioned have been forced to climb over barriers of established and outmoded practice. Only in rare cases can a company start on the total quality journey unencumbered by the baggage of history - like National Westminster Life. Set up from scratch as a total quality company, it started business in January 1993: within a year it was heading towards a billion pounds of annual sales and the top dozen of British life insurers - business results which demonstrate that total quality is no fad, but an agent of highly effective change.

Change, profound and unstoppable, has management in a grip that is revolutionising practice more than any advance made since F W Taylor introduced scientific management before the first world war; and change is revolutionising organisational theory more than any progress made since Peter Drucker explained the concept of corporation after the second world war. The spirit of change that has swept over companies between the 1980s and the 1990s is apparent in everything from the flattening of hierarchies and the rise of multi-disciplinary project teams to the new emphasis on leadership - and the coming of TQM.

The issue behind the survey is the extent to which British management is keeping up with these changes. The 'five pillars of TQM', according to retired US Air Force General Bill Creech, are product, process, organisation, leadership and commitment. The Vauxhall survey is consistent with the view that the British emphasis rests too heavily on the first pillar, product. While much work has been done to improve processes, not enough has covered the entire business system, summing up all processes from supplier to final customer.

That demands fundamental, sometimes unwelcome changes in organisation, the behaviour of leaders and organisational objectives. A commitment to quality in the broadest, total sense isn't compatible with making growth in earnings per share the prime corporate aim. The best business results, though, may well flow from companies that, as in the European Quality Award model, rank profits along with other, non-financial criteria as part of the total objective: a company in which quality runs from top to bottom of the organisation.

1 How much do you know about quality improvement issues? % (n = 270).

Director Senior Junior All

manager manager

A lot 33 26 16 24

A fair amount 52 50 38 46

A little 16 21 37 26

Nothing at all - 3 9 4

2 What is your perception of quality improvement? % (n = 270).

Director Senior Junior All

manager manager

Cont. improvement

involving everyone

in the organisation 94 94 93 94

Cont. improvement

mainly involving

manufacturing 6 23 21 18

An expression of

the culture of an

organisation 50 58 48 52

Project-based

improvement 22 25 36 29

Business process

re-engineering 22 30 29 28

A passing

fad of the '80s 6 4 13 8

Irrelevant in the

real world 2 5 6 4

3 Which of the following phrases best describes your company's

involvement in quality improvement? % (n = 232).

Director Senior Junior All

manager manager

Whole org.involved 51 46 52 49

Some depts more

involved than others 37 39 47 41

Some people more

involved than others 23 26 22 24

4 Where is your company in terms of quality improvement? % (n =

270).

Has a Quality Improvement Programme 69

In the process of setting one up 12

Is thinking of setting one up 5

Had one but dropped it 1

Never had one 11

Don't know 3

5 How much has quality improvement helped business goals? % (n =

232).

Director Senior Junior All

manager manager

A lot 58 62 54 58

A little 32 30 32 31

Not much - 4 6 4

Not at all 2 1 1 1

Don't know 9 3 6 6

6 Do you agree or disagree with the following views of quality

improvement? (n = 232).

Director Senior Junior All

manager manager

Things are really different around here and there is a clear

commitment

to quality improvement throughout the organisation

% agree 74 66 68 68

% disagree 15 25 25 22

There is a lot of interest and active quality improvement teams but

top

management only give lip service and are really only interested in

cost

savings

% agree 30 34 41 36

% disagree 62 54 54 55

There is a lot of interest and action at the top of the organisation

but

it has failed to percolate down much.

% agree 21 45 42 38

% disagree 72 48 50 55

There are a few enthusiasts around the company but interest is not

wide.

% agree 25 37 42 35

% disagree 72 57 52 59

It's a lot of hype

% agree 11 17 22 17

% disagree 84 77 72 77

7 What do you call your quality improvement programme? % (n = 216).

TQ/TQM programme 15

Total quality programme 13

Other 45

No particular name 27

8 If your programme is not called TQ, how similar is it to the TQ

approach? % (n = 134).

Director Senior Junior All

manager manager

Identical 14 14 4 10

Very similar 34 20 36 30

Somewhat similar 34 47 36 40

Totally different 17 6 4 8

Don't know - 12 20 12

9 Are you aware of the following quality related concepts? % (n =

270).

Director Senior Junior All

manager manager

Total Quality 100 97 89 95

Just in Time 95 88 74 84

TQ or TQM 95 83 73 82

Internal customer 84 76 70 76

Zero defects 84 69 64 71

Quality is free 55 37 33 40

Kaizen 48 37 27 36

PDCA cycle 16 8 6 9

10 Are you aware of the following quality theorists? % (n = 270).

Director Senior Junior All

manager manager

Any theorists 77 68 55 65

Crosby 55 42 25 39

Deming 55 37 28 38

Ishikawa 45 37 27 35

Juran 41 36 24 33

Taguchi 36 21 19 24

Shingo 33 16 16 20

Imai 9 8 5 7

11 How is the success of your quality improvement programme

measured? % (n = 232).

Manufacturing Service All

companies companies

Customer satisfaction/

complaints/

compliments 31 27 29

Sales/profit/

cost monitor 26 19 24

Audits/

targets 22 16 20

Lack of returns/

waste 15 7 12

Service standards/

level of service 9 12 10

Customer satisfaction

surveys 3 12 6

12 Do customers insist on commitment to a quality improvement

programme? % (n = 270).

Manufacturing Service All

companies companies

Yes, most of them 16 6 12

Yes, some of them 33 21 29

No 37 63 47

Don't know 14 11 12

13 How many of your suppliers are involved in quality improvement? %

(n = 270).

Manufacturing Service All

companies companies

Almost all 18 8 14

Most 25 17 22

Almost half 23 26 24

Hardly any 14 27 19

None 1 - 1

Don't know 19 22 20

14 Did you receive any quality improvement training? % (n = 232).

Director Senior Junior All

manager manager

Yes 46 44 52 47

No 46 49 40 45

Other/not applicable 8 7 8 8

15 How much quality improvement training did you receive? (n = 109).

Director Senior Junior All

manager manager

No. of days training

received on average % 5.3 7.1 4.8 5.8

1 day 13 10 12 11

2-3 38 22 26 27

4-5 13 32 36 29

6-7 16 7 17 14

9-14 13 15 7 11

15+ 8 15 2 8

16 If you received no training, do you agree with the following? %

(n = 104).

Director Senior Junior All

manager manager

I should have

received training

%Agree 27 39 44 38

% Disagree 73 57 50 59

Don't know - 4 6 4

A total of 270 interviews were conducted with respondents from the FT Top 500 companies. Within each company a target of three interviews was set, one from each management level. Types of company covered were manufacturing (61%), service (24%) and financial (15%). Research was carried out by BMRB International.

Key findings.

1 70% of managers claim to know 'a lot' or a 'fair amount' about quality improvement.

2 69% of companies have quality improvement programmes and 12% more are setting them up.

3 49% of managers with experience of QIP thought their whole organisation was involved.

4 58% think that quality improvement has helped 'a lot' in reaching business goals.

5 On most counts senior managers are more positive abut the programmes than junior managers.

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Upcoming Events

Subscribe

Get your essential reading delivered. Subscribe to Management Today