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There have been many models in and out of fashion over the past few decades, as I say; " Models and framework are often adopted as a panacea for the organization ills of the day. They are latched onto and pursued relentlessly until the next favor of the month turns up. All models are in some way flawed or have a narrow focus , but organizations need to understand their strengths and weaknesses and how best to adapt and adopt the underpinning principles where the organization can benefit most. Pursuit of long term gains has to be at the heart of any organizational strategy and these frameworks can only help to shape policies and practices in the achievement of strategic goals."
If long term goals are kept in mind ,an organization quality model can bring impressive and sometimes surprising benefits to a company. There are countless examples of businesses saving money by implementing the principles of excellence model or ISO 9001. No model is perfect and every organization must choose what works best for them. but if a model is applied correctly to all elements of a business with the backing of all staff, then the rewards can be huge.
Once an organization has committed to fully implementing an organizational quality model, where should it turn? The number of models available seems to be endless , particularly within the increasing number of sector-specific tools available. The four models presented over the page give a brief overview of the most popular quality models., but it is up to each individual organization to decide which direction to take.
ISO 9001
ISO 9001 is one of the most well known quality assurance model available. The international standard for quality management systems has its roots deep in military history , with influence from US military standards in the 1950s, NATO's Allied Quality Assurance Procedure standard in the 1970s and Canadian and British standards in the 1980s. As the foreward states, ISO 9001 was " developed in the interest of international harmonization and international trade." It has been revised several times over the years, with the latest revision published in 2008.
In basic terms, ISO 9001 provides a set of requirements, which when implemented can ensure an organization's processes produce products that meet customer needs. It is designed for use in organizations of any size or sector , for contractual and certification purposes. It does not dictate how an organization should meet the requirements in the hope of leaving scope for organizations to develop their own approach.
ISO estimates that almost a million organization are certified 9001 in 176 countries. However, while the standard's popularity has soared over the decades , many heated debates have focused on whether ISO 9001 really is a useful tool. John Seddon, founder of Vanguard Consulting and outspoken critic of the standard , describes it as " quality of under achievers. The only reason it has been successful is because of market coercion; if people didn't buy it, it wouldn't have taken off."
But David Hoyle, author of ISO 9000 Quality Systems Handbook, defends the proper use of standard. He says: " The principles of ISO 9001 are sound, but it it is still too prescriptive. It currently drives a compliance tick-box culture where doing activities is deemed more important than achieving objectives. The main challenge is to simplify the requirements so that they can be understood and applied in every organization."
One of the main benefits that can be derived from certification to ISO 9001 is gaining contracts. Many organizations around the world ask for ISO 9001 certification as a prerequisite for engaging supplier. As David say, many organization become certified " to get a badge on the wall: cynical perhaps, but true in many cases. Greater benefits can be gained if the organization is committed to meeting the intent of the standard and is determined to manage its certification and management system in a way that will bring business benefits as is in the case in the automotive and aerospace industries".
The Balanced Scorecard
The balanced scorecard was first introduced in 1992 by Robert Kaplan and David Norton in the Harvard Business Review. As the article states: the key objective of the balanced scorecard is to "help senior managers systematically link current actions with tomorrow's goals, focusing on that place where, in the words of the authors, the rubber meets the sky". It encourages organizations to augment traditional financial measures with benchmarks for performance in three key non-financial areas:
- A company's relationship with its customers
- Its key internal processes
- Its learning and growth
Bernard Marr, Chief executive and director of research of the Advance Performance Institute describes the model."It was developed out of the problem that most performance indicators were financial. Companies realized these were lagging indicators and didn't tell you a lot about the future. You need to balance what will lead to future success with the outcomes of past performance. The balanced scorecard enables you to have all of an organization's objectives on one page.
The benefit that the model aims to achieve is better strategic planning through the creation of a strategy map as shown in my book Strategic Management: Building Competitive Advantage. This will highlight the case- and -effect logic: that the right performance can only be achieved by delivering the right objectives in other perspectives. With all objectives and enablers on one page , an organization should be better able to reduce waste and focus on the things that all stakeholders agree are important.
But adopting the balanced score-card is not straightforward. There are many challenges , as Bernard explains: " The main pitfalls is that organizations take shortcuts when they design their strategy and populate the strategy map without thinking things through.
" Another pitfall is that organizations take a map as a straitjacket. Organizations need to feel free to change and rename perspectives to make them fit to their own strategy. The project must be led by senior management , but if it is used as a top-down control tool, it will not work. It is a learning and improvement tool, not a "big brother "tool."
" I find it very frustrating that organizations introduce quality tools and go for the low -hanging fruit where they can chip off a bit money and time. They should be mapping their strategy and using tools such as lean to under-pin them."
Paul Simpson, CQI technical manager, says:"The balanced scorecard was introduced to right an unbalanced overemphasis on financial measures. There is a simplistic view that selecting about 20 measures across four areas is a replacement for the understanding and developing strategic measures underpinning a balanced approach."
The widest use of the approach can be found in the US, the UK , Northern Europe and Japan. Research by Gartner Groups suggests that more than 50% of large firms use the tool. However, interest around the globe is increasing , as Bernard explains." The best performing and largest organizations around the world use the tool and there has been a lot of recent interest in China. A big drive at the moment is in government and smaller businesses."
The Excellence Model
First developed in 1992 by he European Foundation of Quality Management , the excellence model is a three-part management framework that forms the basis of many quality awards. The eight fundamental concepts, the radar assessment and management tool and nine -box model itself have been designed to help any organization on its road to excellence. It can be used for self-assessment and is popular tool to be used when benchmarking against other organizations.
The nine-box model as shown in my book Strategic Management:Building Competitive Advantage, is made up of five enablers and four results. The enablers cover what an organization does , while the results encompass what an organization achieves. The radar logic and assessment is then used to give an organization a score, which is determined by the different weightings of each criterion. The fundamental concepts underpin the whole philosophy of the model , such as "adding value for customers" and "managing by processes"
Joe Goasdoue, chief executive of the British Quality Foundations, explains the impact of the standard." While there are numerous management tools and techniques commonly used , the EFQM excellence model provides a holistic view of the organization and it can be used to determine how these different methods fit together and complement each other. The model can therefore be used in conjunction with any number of these tools, based on the needs and function of the organization , as an overarching framework for developing sustainable excellence."
Criticism of the model generally circles around topics common to many quality models: that the model contains too much jargon, for example, or that using the model is too resource intensive for small businesses. another is that model , the concepts and the radar logic have not traditionally been joined up enough.
Paul Simpson explains a further danger of the model."The model's simplicity often misleads organizations into believing that its use is easy Embedding policies and processes to satisfy the model's criteria remains a long and difficult road with some travelers distracted by a beauty pageant that is the awards process."
In an attempt to act on various criticism, the model was updated at the end of 2009 for the first time in six years. The aim was to make it a more relevant tool for modern organizations , with added topics such as sustainability , innovation and creativity, and an overall focus on long-term strategy. A plan has now been put in place to review the model at least every three years , to ensure that the concepts stay relevant to current business challenges.
Total Quality Management
There are many definitions of total quality management and the best is found in the guidelines to the Deming Prize.
These state: "TQM is a set of systematic activities carried out by the entire organization to effectively and efficiently achieve its objectives so as to provide products and services with a level of quality that satisfies customers, at the appropriate time and price."
While there are many quality tools that form part of TQM, such as process maps, statistical process control, Pareto analysis and cause and effect diagrams, it is itself not a system , a tool or a process. It is much more of a way of thinking or a philosophy that applies to the whole organization. The long term approach of TQM contains eight basic elements such as "customer -focused organization" and "system approach to management."
The roots come from the work of Walter Shewhart in the 1920s, evolving via Deming from the 1930s onwards through the Japanese implementation from the late 1940s that became known as total quality control, to six sigma and lean manufacturing today. The term TQM emerged in the 1980s when the US navy based its quality system on the different thinking taught by Deming. Deming himself was unhappy with the use of TQM because it quickly became vague with multiple definitions poorly carried out.
As Alan Clark of the Deming special interest group, says, "Unfortunately people didn't change their thinking , they just took the bits they liked and of course it didn't work. TQM like lean, is only effective if fully taken on board, with senior management leading by example."
John Davies , head of business and public sector partnership of Salford Business school agrees. "There is almost universal acceptance that the principles on which TQM and the excellence model are based make good. The problems tend to arise when the system is poorly implemented. When this fails it is easier to claim that there is something wrong with what is being implemented rather the implementation process itself."
And JOP believes that the teachings are just as relevant today and tomorrow as ever.
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