Part 3: Is Quality an Issue Again?

In my time as a professor of operations management in the School of Business and Nonprofit Management at North Park University, I came to realize the lack of a definition of business in all the books I have read and textbooks I have used in courses.  I do believe we all just assumed that everyone simply knew what a business was and what businesses were supposed to do.

I do believe that everyone just assumes that simply a business is an organization with the expressed purpose of making money selling products or services.  This is not wrong.  It clearly puts the focus on making money.  The result of this definition is in the way we value and track business.  Profit is the primary measure with an emphasis of profit in the short term.  With focus on the current quarter and current year, business leaders can easily trade off design and product quality to make their numbers.  They will drive down costs and drive up productivity, which again are what businesses should do.   But when driving down costs and driving up productivity become the primary operations emphasis… well, there is a greater likelihood quality might be compromised.

Deming had a graphic that was a major pillar of his philosophy presented in his book, Out of the Crisis, first published in 1866.  He may have used this graphic in his famous 4-Day Seminars well before the publishing of his seminal book.  He begins with improve quality which will drive down costs and drive up productivity.  This allows the enterprise to capture more market share with better quality sold at lower prices which perpetuates the enterprise.  Deming adds that more and more jobs will be created.  These days that will happen at a slower rate, if at all, because of the advances in technology and, now, the looming promise of AI.

I have certainly used my own rendition of Deming’s graphic, but it does not suffice as a general definition of business.  So, I decided to write one that I use in all my classes.

1. Business is business. It is cut and dry.
2. Provide products and services that customers want, sell these same products at a high volume at a price higher than the cost of goods and production, and, voila, the business is profitable and can thrive and grow.
3. Don’t do this and the opposite happens, the business loses money and will eventually have to cease operations, call it quits. 
4. This is not a one-time deal. Businesses have to do this continually.
5. To make it even more challenging, competitors would love to steal market share and act aggressively to do just that.
6. Markets and the preferences of customers are always changing.
7. So, businesses need to be aware of all this and adapt and innovate their product and service offerings to remain competitive and relevant to their customers.
8. As a result, some businesses expand and grow while others shrink and even go out of business

I have been happy with my definition of business but just noticed that I do not specifically use the word quality nor do I invoke the quality mindset in this definition.  It is assumed in point #7. 

To wrap up this series of posts.  Any company that can offer and innovate product and services that customers and consumer will value and then produce and deliver them in a defect and error should do better than their competitors.  If this becomes part of their culture and the company can excel at it, the company will thrive.  Customers and consumers will know it and become loyal consumers and customers. 

I believe Quality is always the issue.  Companies need to dig deeper to find out what customers and consumers want and design products and services that meet or exceed those needs.  Then, it is Job 1 of operations to deliver and exceed on delivering products and services that meet or exceed customers and consumers in ways that those products or service cause no issues and certainly causes no one to report a problem on the National Consumer Rage Survey.

As has always been the case in the realm of quality management, creating that culture to deliver better products and services is never easy… but it not impossible.

So, yes Quality is always an issue.  The mindset has to be the old Lexus matra, “The relentless pursuit of perfection.”  It is the old Ford mantra, “Do it right the first time.”  It is what Reuben Mark the CEO of Colgate-Palmolive would always say, “getting a little bit better, every day, in every way.”

The tenets of Total Quality Management are as relevant today as they ever were:

• Customer Focus
• Strong Quality Leadership
• All Employee Involvement
• Continuous Improvement
• Fact Based Decision Making

      These principles are evergreen.