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What Do CEOs Think About Quality Quality professionals can count on the support of the American Society for Quality when justifying the cost of quality to upper management. ASQ has conducted a survey of top executives in manufacturing, service, healthcare, and education to determine their perception of the quality issue. The survey’s conclusion indicates there is a significant gap between awareness and actual usage of quality initiatives and business process improvement. Executive s tend to define quality as a product attribute, rather than as a management tool. An ASQ project team will use survey results to prepare materials for quality professionals to use in their campaigns to convince upper management of the economic value of implementing quality. A sidebar describes demographics used in the survey.
Selling Six Sigma to Upper Management Peter Drucker contends that CEOs can be easily convinced to "do" quality provided the staff clearly reports necessary information that can be easily assimilated and understood so that the CEOs may draw their own conclusions. Two criteria for building such a "Drucker report" are balance in measurement to ensure all perspectives are reflected in an assessment of performance, and alignment to ensure the organization has a linked response between corporate metrics of success and operational actions that deliver success. These concepts are also foundations for building a Six Sigma customer dashboard, an extension of the balanced scorecard concept that focuses on value delivered to customers by employees. A Drucker report is a top-level report card of a Six Sigma customer dashboard, and it must be understood before an entire Six Sigma customer dashboard can be created. Six Sigma logic supports the CEO's need to deliver shareholder value by developing deeper insights than those of a pure financial measurement system. A sidebar article explains factors related to return on investment (ROI) used in calculating profit.
Learn To Talk Money Upper management speaks a different language from that of quality professionals. Management is driven by financial performance. Understanding and accepting management’s financial vocabulary will increase the likelihood that the quality professional’s suggestions will be heard and accepted. Quality professionals must not only understand what constitutes a defect or waste, but must also understand the financial impact the defect or waste has on the organization. Definitions of key financial terms offer the means to getting things accomplished faster and more predictably within an organization. Sidebars provide a sample balance sheet and income statement.
Improve Profits With Standards The goal of CEOs and business managers is to make products that please customers and produce a profit. The International Organization for Standardization (ISO) provides a roadmap for profit gains through its standards and technical reports. Used in conjunction with the guidelines in ISO/TR 10014, ISO 9000 quality management standards can be a powerful tool for the economic challenges facing U.S. businesses.
The Image and Reality of Excellence Medical device manufacturer Medrad Inc. was the only company in the manufacturing sector to receive the Malcolm Baldrige National Quality Award for 2003. The company has been involved with Baldrige since the award’s inception fifteen years ago. Medrad credits Baldrige for much of its worldwide reputation for high quality products and customer satisfaction rates. Additionally, continually improving performance in the Baldrige criteria has led to impressive business results. Medrad believes quality products, satisfied customers, enthusiastic employees, and market leadership are ample rewards for its investment in Baldrige. |
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