Acceptable quality is a prerequisite for entry to your marketplace. A company whose products are not functionally and aesthetically satisfactory soon finds its products off its customers' must-have list.
U.S. manufacturers learned that lesson good and hard beginning in the 1970s when Japanese companies, driven by their culture for continuous quality improvement, began taking market share here. Japan's business leaders developed means for assessing customer satisfaction, process performance and the like, and installed fine-tuned management systems in their companies. These companies were motivated by financial returns but, more importantly, believed that profits resulted from attaining superb quality.
So-called experts pointed to a wide range of reasons for Japan's success, such as their work ethic and cultural homogeneity. But the real reason was superior execution that resulted in fewer defects and higher productivity of capital and labor. In short, Japanese managers out-managed us during that time.
We know, too, that Japan learned about quality from American experts. Edwards Deming led the way by teaching them about statistical process control. Joseph Juran, often known as the second American to preach the gospel of quality to Japan, advised them that quality must be embedded throughout their organizations.
To mark his recent passing, let's revisit a few bits of Juran's wisdom.
Definition of quality
Juran defined quality as fitness for use i.e., the product or service must fulfill the consumer's intended purpose. Fitness has five key dimensions:
- Quality of design: the product's design and other distinguishing attributes vis-à-vis the customers' expectations
- Quality of conformance: how well the product matches the design intent and the production process meets specified tolerances
- Availability: freedom from disruptive in-service defects
- Safety: freedom from product hazards
- Field use: the fulfillment of the customer's expectations in terms of packaging, transport, after-sales service, and speed of delivery.
According to Juran, achieving the necessary fitness for use requires an extensive quality process that reaches from a product's initial design through production and out to the end user.
More than inspection and statistics
Many call him the father of quality. However, Juran believed that quality extended beyond the physical product to cover the entire business. From this belief he developed quality control from its statistical origins to a full-fledged management philosophy called the Quality Trilogy. His goals were, first, to maximize customer satisfaction by producing products with demanded features and, second, minimize dissatisfaction by eliminating defects and reducing costs.
The first of three parts in the trilogy is quality planning, which combines what many today call strategic planning, marketing and product development. Its goal is to create a process that will meet its objectives under operating conditions by:
- Identifying who the customers are
- Determining the needs of those customers
- Translating those needs into an end product
- Optimizing the product's attributes to meet the customers' needs
- Developing a process that provides the product most efficiently
- Proving the process under operating conditions
The second part is quality control, which consists of a feedback loop whose primary goal is to keep any waste inherent in a process within currently accepted limits. Its tasks are:
- Selecting the process to control
- Establishing a control metric
- Setting a performance standard or target
- Measuring actual performance
- Effecting remedial action to ensure process stability
The third leg of Juran's system is quality improvement, the quest for process breakthroughs that generate superior performance. Reducing waste, exceeding the competitions' standards, lowering total cost, and offering better products are the critical goals of this part of the trilogy. Its key tasks are:
- Confirming the need for breakthrough improvement
- Diagnosing the process's weaknesses
- Developing a remedy
- Proving the remedy's effectiveness under operating conditions
Juran's trilogy has an audacious yet easy-to-understand goal: reducing the risk of failure through effective, watchful management.
Top down involvement
The impetus for quality in Juran's opinion must be senior management. In fact, he attributed the success of Japanese manufacturers in the last third of the 20th century to their senior executives taking personal responsibility for quality. Such involvement drove intensive company-wide quality training, a high pace of continuous quality improvement, and active participation of front line workers in improvement efforts. Equally important was the inclusion of quality goals in their business plans alongside more conventional financial objectives. As we know, this quality revolution in Japan resulted in a massive change in the country's economic fortunes.
Juran viewed overcoming opposition to change, what he called cultural resistance, as the vital first step in implementing any quality improvement program. He was one of the first management specialists to recognize the importance of internal marketing: convincing those responsible for implementation and those affected to adopt new methods.
Juran is credited by many for first applying the Pareto principle to quality management. Also called the 80/20 rule, Pareto theorized that roughly 80 percent of results are generated by 20 percent of causes. Juran admonished quality practitioners to focus attention on "the vital few" causes while ignoring the "trivial many." In that way, capital, labor and time are expended for maximum benefit.
Cost of quality
Deming and his followers refer to statistics such as defect rates as being the language of quality. Juran, on the other hand, believed that quality must be communicated to senior management in their language: money. His cost of quality accounting system consisted of four elements:
- Internal failure costs for correcting defects before shipment
- External failure costs for fixing defects after customer receipt
- Appraisal costs for inspecting materials and products
- Prevention costs for avoiding defects
Juran thought that a quality program must pursue improvement until the cost of appraisal and prevention was no longer offset by the costs of failure. This premise means that striving for zero defects is impractical. There is a time to maintain existing quality rather than invest in improving it.
Bottom Line: Juran believed that fixing poor quality in a product or a process requires total involvement. Put simply, quality is too important to be left to the quality department.
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