Finicky, Picky, Strict, Perfectionist, Puritanical etc. etc. are adjectives, rather expletives “flung at” me liberally by friends, family, colleagues, acquaintances, and… to my chagrin… even my 6 year old son!!! [Thank God, his vocabulary (now) is limited to “so strict” and “such a bore”].
A while ago, I got reading stuff on “Quality Management” and found that the way I feel about work, life, expectations - virtually everything - can be mapped to theories or practices found in this great body of knowledge! Now when I am mercilessly taunted, I say, “Guys, it’s all about Quality! I like Quality in what ever I do!!! Now, how is that for a retort!!!
Jokes apart, the more I read about Quality, the more amazing and interesting it gets and, the more I want to talk about it – I am not a subject matter expert but I would like to share a few thoughts about Quality Management and how it can help us achieve better results at work, in life and even alter the way we look at things around us or tackle our day-to-day tasks!
With “Global Crisis” shadowing every aspect of our lives right now and “cost-cutting” being the current mantra, I would like to talk about “Costs” and “Quality” and how one affects the other!
We all know this for a simple fact:
“Quality products or Services” => more customer satisfaction => more demand => more business => more profits/ more growth/ more job opportunities!
In short,
Quality => more ROI J
Most organizations do not have a Quality Management Department or even a Quality plan in place. The reasons might be varied. At the core of these reasons I am sure is the cost factor – the cost of setting up a quality department, cost of maintaining quality standards etc. etc.
However, Quality guru Philip Crosby says, “Quality is free”! In order to understand what Crosby means, we might want to ask the question, what is the cost of quality?
“Cost of Quality” or COQ is a term widely misunderstood. Cost of quality is not the price of creating a quality product or service. It is rather, the cost of NOT creating a quality product or service!
In other words, any cost that would not have been expended if quality were perfect, contributes to the cost of quality.
Phil Crosby’s definition of COQ is, “the price of non conformance”. Another quality guru, Joseph Juran says COQ is “the cost of poor quality”. Basically, COQ refers to the costs associated with providing poor quality product or service and not the other way round!
Why is this so?
Finding and correcting mistakes consume an inordinately large portion of resources. Typically, the cost to eliminate a failure in the “customer phase” (i.e. after the product or service has been delivered to the customer) is five times greater than it is at the development or manufacturing phase. Effective quality management decreases production costs because the sooner an error is found and corrected, the less costly it will be.
So, every time work is redone, the cost of quality increases.
Total Quality Costs is the sum of all the below costs. This represents the difference between the actual cost of a product or service and what the reduced cost would be if there were no possibility of substandard service, failure of products or defects in their manufacture.
1. External Failure Cost: cost associated with defects found after the customer receives the product or service. Eg: processing customer complaints, customer returns, warranty claims, product recalls.
2. Internal Failure Cost: cost associated with defects found before the customer receives the product or service. Eg: scrap, rework, re-inspection, re-testing, material review, material downgrades.
3. Inspection (appraisal) Cost: cost incurred to determine the degree of conformance to quality requirements (measuring, evaluating or auditing). Eg: inspection, testing, process or service audits, calibration of measuring and test equipment.
4. Prevention Cost: cost incurred to prevent (keep failure and appraisal cost to a minimum) poor quality Eg: new product review, quality planning, supplier surveys, process reviews, quality improvement teams, education and training.
Obviously, the higher we go up that list, higher are the cost implications. Therefore, it is better to incur some “prevention costs” and prevent failures than turn a blind eye and be slapped with huge “external failure” costs!
Better still, if each employee in the organization takes Quality as his/her personal responsibility to make each job as perfect as possible by conforming to customer requirements and going that wee mile to exceed customer expectations, then the inconspicuous but deadly “cost of quality” will be zero!
Research shows that the costs of poor quality can range from 15%-40% of business costs - rework, returns or complaints, reduced service levels, customer service errors, the cost of product replacement, waste etc. are indeed lost revenue! Most businesses do not know what their quality costs are because they do not keep reliable statistics. This is where a quality management plan or tools can come in the picture! Otherwise, as per the TQM (Total Quality Management) philosophy, ‘quality is everyone’s responsibility’!!!
Again, it was Crosby who introduced the idea of DIRFT i.e. “Do IT Right the First Time”, every time! If each employee in an organization takes the pledge of DIRFT, we would have a TQM organization!!!
(reposted: http://creativeconceptsdubai.blogspot.com/2009_03_01_archive.html)
Mary Aji
Line Manager - Marketing
