Quality Is Free

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A MENTOR •

#
BOOK 451-ME2585 \IJF (CANADA $6.99) • U.S. $5.99

HOW TO MANAGE QUALITY


SO THAT IT BECOMES A SOURCE
OF BUSINESS PROFITS.
"THE EXECUTIVE WHO SPENDS HALF A
DAY DIGESTING THIS BOOK
MAY FIND IT ONE OF THE MOST
VALUABLE INVESTMENTS OF TIME
HE OR SHE HAS EVER MADE'.'
-BUSINESSWEEK

BY PHILIP B. CROSBY

MOST PEOPLE FEEL THAT ALL
PROBLEMS ARE CAUSED BY OTHER PEOPLE.
SOME PEOPLE FEEL THAT ERROR IS
INEVITABLE, AND EMPLOYEES JUST
DONT GIVE A DAMN ABOUT
DOING GOOD WORK.

These are the kinds of myths that result in American


companies spending 15 to 20 percent of every sales
dollar on reworking, scrapping, repeated service, in-
spections, tests, warranties, and other quality-related
costs. Now, Quality Is Free shows you how to over-
come the traditional idea that quality control is

something that happens only on the manufacturing


line, not in the management office. Drawing on
actual case histories, the author spells out successful
methods for instituting a quality control system in

any company a proven system that can increase
profits by an amount equal to 5 to 10 percent of
sales. Many companies are already using Philip
Crosby's "Zero Defects" system to reap larger profits

because they have learned as you will too that —
all-important message of this book

QUALITY IS FREE
About the Author

PHILIP B. CROSBY is chairman of PCA, Inc., the quality-


management consulting firm that contains the Quality Col-
lege. Begun in Winter Park, Florida, in 1979, Philip Crosby
Associates, Inc., now operates internationally and is a
publicly listed corporation. He is the author of Quality Is
Free, Quality Without Tears and Running Things which are
available in Mentor editions.
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QUALITY
The Art of Making
Quality Certain
By Philip B. Crosby

©
A MENTOR BOOK
MENTOR
Published by the Penguin Group
Penguin Books USA Inc., 375 Hudson Street,
New York, New York 10014, U.S.A.
Penguin Books Ltd, 27 Wrights Lane,
London W8 5TZ, England
Penguin Books Australia Ltd, Ringwood,
Victoria, Australia
Penguin Books Canada Ltd, 10 Alcorn Avenue,
Toronto, Ontario, Canada M4V 3B2
Penguin Books (N.Z.) Ltd, 182-190 Wairau Road,
Auckland 10, New Zealand

Penguin Books Ltd, Registered Offices:


Harmondsworth, Middlesex, England

Published by Mentor, an imprint of Dutton Signet,


a division of Penguin Books USA Inc.

This is an authorized reprint of a hardcover edition published by


McGraw-Hill Book Company.

First Mentor Printing, January, 1980


27 26 25 24 23 22

Copyright © by Philip B. Crosby.


All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means electronic, mechanical, photocopy-
ing, recording, or otherwise, without written permission of the publisher. For information
address McGraw-Hill Book Company, A Division of McGraw-Hill, Inc., 1221 Avenue
of the Americas, New York, New York 10020.

® REGISTERED TRADEMARK— MARCA REGISTRADA

Library of Congress Catalog Card Number: 79-89296

Printed in the United States of America

BOOKS ARE AVAILABLE AT QUANTITY DISCOUNTS WHEN USED TO PROMOTE PRODUCTS OR


SERVICES. FOR INFORMATION PLEASE WRITE TO PREMIUM MARKETING DIVISION. PENGUIN
BOOKS USA INC. 375 HUDSON STREET. NEW YORK. NEW YORK 10014.

Ifyou purchased this book without a cover you should be aware that this book is stolen
property. It was reported as "unsold and destroyed" to the publisher and neither the

author nor the publisher has received any payment for this "stripped book."
To
Harold & Geneen

Bringing Quality Management to the head table was


not exactly the same as introducing black baseball play-
ers to themajor leagues; but there were enough similari-
ties to make me feel toward Harold Geneen what Jackie
Robinson felt toward Branch Rickey.

In both cases the motives were the same: to increase


the probability of having a winning team.

To quote HSG: "Quality is not only right, it is free.


And it is not only free, it is the most profitable product
line we have."
Contents

Preface ix

Pari One
THE UNDERSTANDING 1
1 Making Quality Certain 3
2 "Quality May Not Be What You Think It Is" 13
3 The Quality Management Maturity Grid 21
4 Management Understanding and Attitude 35
5 Quality Organizational Status 55
6 Handling Problems 72
7 Cost of Quality 101
8 Quality Improvement Program 108
9 Management Style 120

Part Two
THE DOING
The HPA Corporation Quality
Improvement Program 137
10 History of the Project 139
11 The Program 149
THE TOOLS 223
12 Instructor's Guide for HPA
Quality
Improvement Program Case History 225
13 Make Certain 241

Guidelines for Browsers 250


Index 265
Preface

I have learned to carry my typewriter with me as I travel.


Renting is iffy, and unreliable at best. Checking the machine
with the airlines is not wise. Portable typewriters are just not
packaged for "luggage" treatment. Machines that can survive
this system cannot be lifted.
Naturally, your traveling companions ask if you are a
writer. Now if you really are a writer, all you have to do is
say yes and an interesting conversation is established during the
trip. However, I have never considered myself a writer. I
consider myself a professional manager who communicates
through many means; one of these is writing.
That may seem like a small difference in terms, but it is
really more than that. Trying to explain your ideas so others
can understand them is what this sort of thing is all about.
Trying to offer concepts in attractive packages so the com-
municatee has to at least consider them has been the struggle
of my life. Some of these concepts have been accepted, but
usually only several years after I began developing them. That
is only fair since it takes a lot of years to conceive them.

I wasn't born a manager; my family always envisioned me


as a medical person. My father was a chiropodist, my uncle,
a physician, and the whole outfit was involved one way or
another in the medical field. I grew up assuming I would
enter it too.

ix
X PREFACE
It is not my intention to relate the story of my life; you
would doze off before reaching the end of the page. No life
story, but there is a point to all this. I started at the bottom
of the business and have had each and every job on the way
up. Inspector, tester, assistant foreman, junior engineer, re-
liability group engineer, section chief, manager,
engineer,
director, corporate vice president —
all of them. This has pro-
duced a "dirt under the fingernails'* education I would not
have received if fate had dealt me relatives who believed in
the God of engineering or accounting.
Because of these experiences, I tend to see things in terms
of those who must finally wind up doing the job. I see con-
cepts and their implementation as people-oriented. Once in a
while I get a glimpse of the future, enough to know what will
be accepted md what will be ignored. In preparing this book
I have tried to emphasize the practical actions of communi-
cating programs and concepts in a way that will bring results.
This book took an awfully long time to write. Much of the
material r put together over several years has been discarded.
The Grid is a new development as is Make Certain. Both pro-
grams are unique, cheap, and remarkably effective. If you
can't communicate with management using the Grid, and
with people using Make Certain, well, then you are in trouble
too deep to be helped by this little book. Not company trou-
ble, comprehension trouble.
My staff has been very patient with me during the prepara-
tion of this material. Virginia Brauneck, my secretary, has
struggled through translating my clumsy typing into English.
Alternately scowling and breaking into giggles, she put a
great deal of herself into this work. I appreciate it.
My leaders encouraged me through their comments and
interest. Not all corporations would understand when one of
room at night
their senior executives sits alone in a hotel
making clickity-click noises. My
corporation recognizes com-
munication as the engine that makes our society operate or
strangle.
More people have helped me through these twenty-five
years than T can name here. Three of these individuals have
Dossed on. They were special to me and I would like to pub-
liclyremember Tom Willey, Jim Halpin, and Murray Hack.
And, of course, the Crosby family: Shirley, Phylis, Philip,
and Kathy. They always understand; they love me anyway.
PREFACE XI

I hope you read the first three chapters in order. It


will
will all make more sense to you that way. After that you can
hop around any way you please. After all, it's your book.

Philip B. Crosby
JOHN'S ISLAND, FLORIDA
QUALITY
IS Fill
Pari ®mm
THE
UNDERSTANDING
Quality is free. It's not a gift, but it is free. What costs money
are the unquality things — all the actions that involve not do-
ing jobs right the first time.
Quality is not only free, it is an honest-to-everything
profit maker. Every penny you don't spend on doing things
wrong, over, or instead becomes half a penny right on the
bottom line. In these days of "who knows what is going to
happen to our business tomorrow" there aren't many ways
left to make a profit improvement. If you concentrate on
making quality certain, you can probably increase your profit
by an amount equal to 5 to 10 percent of your sales. That is
a lot of money for free.
This book is about the art of making quality certain.
Managers of any operation or function can take practical,
nontechnical steps to improve their quality. They can prevent
those computer programming errors; those burred screws;
those cold steaks; those lost parcels; those miscalculated bills.
All the ways, means, and concepts of making quality certain
are laid out in this book.
Making Quality Certain

What does "making quality certain" mean? "Getting people


to do better all the worthwhile things they ought to be doing
anyway" is not a bad definition. "People" includes top man-
agement as well as the lower levels of the organization. After
all, part of the top job is making certain that all management
functions have the opportunity to perform their responsibili-
ties. The problem is, of course, that everyone who arrives at a
top management job gets there by moving up through one
division, like finance or engineering, that has a limited, specif-
ic function, and may or may not have any ideas about over-
all quality. Top managers may or may not realize what has to
be done to achieve quality. Or worse, they may feel, mistak-
enly, that they do understand what has to be done. Those
types can cause the most harm.
It is up to the professional quality manager to assume the
responsibility for instructing top management about this por-
tion of their job. It is not necessary to be extremely clever or
brave to accomplish this; it is only necessary to be able to ex-
plain it all in terms that cannot be misunderstood. Profession-
als in any role who obscure explanations by using mysterious
terminology do themselves, and their roles, a disservice. They
get some satisfaction from seeing obvious confusion on the
face of their superiors, but that confusion just makes every-
body's job harder.
I started in the quality business as a junior technician test-
ing fire control systems for B-47s. Completely untrained and
uninformed, I learned the simple tasks of adjustment and
3
4 THE UNDERSTANDING
measurement without ever really wondering why it was all
being done at all.
In fact, during my first four or five years in jobs like
that, it never occurred to me to wonder. But then I had the

opportunity to be exposed to reliability concepts and prac-


tices. Most of them were rather mushy and mathematical, but
they revealed an element I hadn't thought about before:
prevention.
That thought brought out a possibility I had never dreamed
existed: "Why spend all this time finding and fixing and fight-
ing when you could prevent the incident in the first place?"
The entire world, it seemed, was convinced that preven-
tion — at least on a grand scale — was highly desirable but
completely unattainable and impractical. It was always re-
ferred to as a sort of dream along the line of King Solomon's
lost diamond mines. I had a great many long and earnest
talks with sincere people who were clear that there was no
way to attain true quality through prevention: "The engineers
woift cooperate." "The salesmen are untrainable as well as a
little shifty." "Top management cannot be reached with such

concepts." "The quality professionals themselves do not be-


lieve it."
I knew immediately that I had found the opportunity I was
looking for. Here was a problem that everyone wanted to
solve but felt was not their responsibility. All I had to do was
find a way to get them committed to improvement without
having to reveal that they had been wrong all along.
For the next several years, as I learned more about manag-
ing quality, I realized that the conventional approach was not
effective. Quality managers proudly stood up and announced
that they personally were responsible for quality in a particu-
lar operation. Just as regularly, and not so proudly, they were
sent down in flames when they were unable to resolve all the
"quality problems" of the company.
As a project quality manager, I was berated each week by
the program director in his staff meeting for not meeting
desired goals while the real culprits from engineering, manu-
facturing, and sales hid their yawns and wished the whole
thing would go away so they could return to their important
work.
It was too clear that some beliefs are so basically
all
ingrained that they cannot be changed just by suggesting they
are wrong. (I should note that my knowledge of this fact is
part of the reason I have been very supportive of the activi-
MAKING QUALITY CERTAIN 5

ties of minorities and women in trying to throw off the roles


assigned and attributed to them.) However, my active revolu-
tion as quality manager didn't really begin until the day one
of the company lawyers told me, in all sincerity, that he
couldn't really understand "what a bright guy like you is do-
ing in a little cul-de-sac like quality." If I had ever thought of
leaving the quality business, that killed it. Some changes had
to be made.
So I began to concentrate on the real problems. First, it
was necessary to get top management, and therefore lower
management, to consider quality a leading part of the oper-
ation, a part equal in importance to every other part. Second,
I had to find a way to explain what quality was all about so
that anyone could understand it and enthusiastically support
it. And third, I had to get myself in a position where I had a

platform to take on the world in behalf of quality.


I think all these goals have been attained. As a member of
senior management of one of the largest industrial companies
in the world, I make as much money, and have just as many
rights, as other senior managers. We have installed effective
and routine ways of understanding quality, and communicat-
ing from the top of the organization to the bottom, as well
as the other way around. I have not been accused, in the past
five years anyway, of having some "quality problem" that I
should do something about.
You can do it too. All you have to do is take the time to
understand the concepts, teach them to others, and keep the
pressure on for prevention. It helps if you train yourself to be
articulate, and it helps if you can keep from becoming emo-
tionally involved in the problems of others. But the whole of
it is attainable and highly practical.

This book is structured to lead you directly through all the


actions required for a proper quality management program.
Case histories, all based on my personal experience, explain
practically everything so you can see how others reacted in
real situations. One of the most interesting of those case his-
tories in volved installing a quality management program in
the ITT Corporation. I include it here without listing any
names of those involved because there were just too many.
ITT, at this writing, employs 350,000 people and has yearly
sales of over $15 billion. There are 2500 or so executives and
over 200 senior executives. You will have to take my word
for it that everyone participated. If I listed all their names, it
would look like the San Francisco telephone book.
6 THE UNDERSTANDING
I will tell the story primarily to give background evidence
supporting the basic premise of this book. Quality is an
achievable, measurable, profitable entity that can be installed
once you have commitment and understanding, and are
prepared for hard work. The case history is a record of
strategy and effort, not a personal job resume.
In 1965, the top management of ITT decided that they
wanted to do something about quality on a corporate basis. It
was apparent that quality was a missing ingredient in the cor-
porate sense of things that were important. It wasn't that
quality was deliberately considered unimportant; no one was
against it. But as an ingredient of industry, like labor, manu-
facturing, engineering and so forth, it didn't exist. To me,
however, quality is the all-important catalyst that makes the
difference between success and failure, and my first goal was
to create a corporate-wide concern for quality. This meant
that absolutely correct requirements would be established and
would be absolutely conformed to, and that everyone would
want to do things right the first time. This concern had to be-
come a part of daily life.
Four objectives were established for the ITT quality pro-
gram. These objectives have served well through the years,
and I commend them to other objective makers:
1. Establish a competent quality management program in
every operation, both manufacturing and service.
2. Eliminate surprise nonconformance problems.
3. Reduce the cost of quality.
4. Make ITT the standard for quality —worldwide.
These objectives could not be accomplished by assembling
a huge staff at headquarters for the purpose of strangling ev-
ery potential problem in its crib. There were only me and the
secretary I shared with two other guys. It was sort of like as-
sembling a raft from the material you obtained while being
swept down the rapids.
So I embarked on a deliberate strategy of establishing a
cultural revolution —
a cultural revolution that would last for-
ever and become part of the corporate woodwork. Firefight-
ing would have to be replaced with defect prevention; quality
would have to be recognized as a genuine "first among
equals"; the habit of doing things right the first time had to
become routine; and, most important of all, the whole thing
had to happen within the units (IlTs word for subsidiary or
other companies) because they wanted it to happen.
MAKING QUALITY CERTAIN 7

To me, a complete corporate quality program has always


been a "table" containing all the "integrity" systems. Quality
control, reliability, quality engineering, supplier quality, in-
spection, product qualification, training, testing,consumer af-
fairs, quality improvement, and metrology; and all the other

systems and concepts of quality rest on this table. Manage-


ment selects what it needs from each and applies these tools
to their total problem. It isn't necessary or wise for each and
every operation to have exactly the same quality program. At
ITT, for example, the personality and needs of one unit may
bear little actual work relationship to those of another, yet
they all need programs both appropriate to them and effective
in terms of the total corporation.
To establish such a program requires much more
knowledge and participation than just a listing of the tools
available in our workchest. It requires that this integrity sys-
tems table be supported by four pillars, or legs, and that they
all be constructed to complement each other. Although these

were actually built as part of the same operation, we will dis-


cuss them one at a time. The four legs are:

• Management participation and attitude


• Professional quality management
• Original programs
• Recognition

Management participation. "Participation," rather than "sup-


port," is the right word for this leg, Management has to get
right in there and be active when it comes to quality. Those
of us who work for others are liable to monitor and measure
them constantly. We
examine them continually to determine
which attitudes and
beliefs are the stronger. We want to
know what pleases them, or, perhaps more accurately, what
displeases them. And we get very good at finding and cali-
brating this information. Therefore causing management at
all levels to have the right attitude about quality, and the

The

right understanding, is not just vital it is everything.
first and it is never over, is to overcome the
struggle,
"conventional wisdom" regarding quality. In some mysterious
way each new manager becomes imbued with this conven-
tional wisdom. It says that quality means goodness; that it
is
unmeasurable; that error is inevitable; and that people just
don't give a damn about doing good work. No matter what
company they work for, or where they went to school, or

where they were raised they all believe something erroneous
8 THE UNDERSTANDING
like this. But in real life, quality is something quite different.
Quality is conformance to requirements; it is precisely
measurable; error is not required to fulfill the laws of nature;
and people work just as hard now as they ever did. These
concepts are covered in detail in the following chapters. What
should be obvious from the outset is that people perform to
the standards of their leaders. If management thinks people
don't care, then people won't care.
At ITT, most of our actions during the formative years
were directed toward dispelling the erroneous beliefs and re-
placing them with those capable of supporting the integrity
systems table. We conducted seminars throughout the ITT
world on a regular basis. Those managing directors and gen-
eral managers who had participated in programs and who
had learned to understand quality properly testified to the
others. They became involved in this evangelic crusade and
the word spread: "The programs actually do work and you
canonist the quality guy." In 1967, one other quality execu-
tive joined the staff and in 1968, quality was set up as a
corporate department of its own. At that time, three senior
quality managers were brought in from the units to become
part of the operation.
Working on a group-by-group, unity-by-unit basis, we
worked our way through the corporation. Orienting, helping,
talking, guiding, badgering, and whatever, we kept the
pressure on. New managers joining the corporation were
made to feel that participation in the quality program was
routine and expected. Therefore, they just sailed right along.
Today you would have difficulty finding anyone at the execu-
tive level anywhere who hasn't been exposed to the true
belief.

Professional quality management. In the early da ys, it was


not possible to find many of the quality people in ITT units,
since they were buried inside the technical and manufacturing
operations, if they indeed existed at all. When found, most of
them were not permitted to travel. And so we formed quality
councils on an area basis. Both in the United States and in
Europe, quality professionals joined together to help each
other and to determine the types of programs required from
the corporate staff. Today there are twenty-seven councils set
up by product and some councils grouped by
line or service,
country also still operate. In addition, there is an executive
council on each continent consisting of the chairpersons from
MAKING QUALITY CERTAIN 9

all the quality councils. Communication among all branches


iscomfortable and positive.
To support the councils, and the programs, we instituted
the Quality College. Teaching such courses as Quality Man-
agement and Product Qualification, the college has issued cer-
tificates to over 24,000 people in its lifetime. It is the
backbone of the total effort. Every time we think there is no
one left to instruct, we find the enrollment full again. The
program has been very effective. All the quality professionals
of ITT understand the programs the same way. They have
been freed organizationally, and report at least on the same
level as those they are measuring. This increases the possibil-
ity that the programs will be implemented properly.

Original programs. Traditional quality control programs are


negative and narrow, and it was no different at ITT. Primar-
ily oriented toward product performance, they often turned
off the management they were supposed to entice. To over-
come this, we constructed numerous programs involving prac-
tical activities which could be implemented at the unit level.
Quality improvement through defect prevention, a four-
teen -step program for improvement, is the foundation of all
ITT quality programs. Described in detail later in the book,
this program has been implemented in every industry or
business of the corporation. Some have been very successful;
some have not done as well. But none ever got worse.
It takes four or five years to get people to understand the
need for, and learn to have confidence in, such an improve-
ment program. I originally sent a sixteen-page brochure ac-
companied by a tape explaining the Zero Defects concept to
every unit. The results were amazing. No one paid the
slightest bit of attention. None of them was even sent back. It
was apparent that the conversion and instruction had to be
done on a unit-by-unit basis until we could get some success
stories to use in the seminars.
Other original programs developed were Buck a Day
(BAD), a cost-reduction idea program; Zero Defects-30 (a
thirty-day program contained in one box with enough
material for a supervisor and eight to ten of the supervisor's
people): Consumer Affairs: Environmental Quality Self- Au-
dit; Quality Management Maturity Grid: Model Quality (a
system for printed circuit board manufacturing); Service
Company Quality Improvement; Make Certain; and many
others.
10 THE UNDERSTANDING
Recognition. This vitally necessary component of any quality
program is often overlooked or conducted improperly. Done
correctly, it becomes the shining star of the entire integrity
system. We established the Ring of Quality program in 1971.
The initial thought was to give recognition to those people
who had offered outstanding support to the quality program
for a period of five years, or had accomplished one sensa-
tional, specific, and unique act. However, it quickly became a
program where the winners were nominated by their peers.
On that basis, we have processed thousands of nominations
and have awarded 182 gold rings to winners. We have also
presented several hundred silver pins and citations to other
nominees. In every case, we tossed out those who were nomi-
nated by their subordinates. Peer nominations make it all
come out right.
The Ring of Quality program is taken very seriously. The
awards are presented at a formal dinner by the corporate
president or chairman. For many of the recipients, it is liter-
ally the biggest moment of their life. Like the rest of the pro-
gram, the presentations are treated with dignity and respect.
Reaction to the rings and pins has made one thing very clear:
Cash or financial awards are not personal enough to provide
effective recognition.
Developing and implementing the four legs of the table in-
volved traveling millions of miles, talking thousands of hours,
and eating tons of food. It was well worth the trouble, as the
following comparison of results obtained with the initial ob-
jectives should demonstrate.

Establish a Competent Quality Management Program


in every Operation, both Manufacturing and Service

When we began, about 5 percent of our companies had


quality programs that could be considered acceptable. In
1977, better than 85 percent were in that category. Pioneer
programs were established for the first time in hotels, insur-
ance, car rental, and other service industries. The number of
competent quality management and professional people has
grown to where their availability is no longer a problem.

Eliminate Surprise Nonconformance Problems


Surprise nonconformance problems have disappeared. We
still have problems, and some of them are pips. But never is

one all grown up before we find it


MAKING QUALITY CERTAIN 11

Reduce the Cost of Quality

The cost of quality (described in detail in Chapter 7) is


the expense of doing things wrong. It is the scrap, rework,
service after service, warranty, inspection, tests, and similar
activities made necessary by nonconformance problems. Be-
tween 1967 and 1977, the manufacturing cost of quality at
ITT has been reduced by an amount equivalent to 5 percent
of sales. That is a great deal of money. The savings projected
by the comptroller were $30 million in 1968: $157 million in
1971; $328 million in 1973; and in 1976— $530 million! We
— —
had eliminated through defect prevention costs amounting
to those dollar figures.
Now obviously not all of this was accomplished just by the
quality people in the units. Rework people disappeared when
there was no more rework. Warranty costs stopped when the
properly qualified products didn't fail in the field. There were
and continue to be many contributions.
But the facts of life today are that each year your cost of
sales rises faster than your prices. That means you have to
eliminate or reduce costs in order to make a profit. The best
single way to do that is by defect prevention.
Results like these are why I say that quality is free. And
not only free but a substantial contributor to profit.

Make ITT the Standard for Quality—Worldwide


The last original objective was to make ITT the standard
for quality —worldwide. In trying to determine how to show
how we stand, it is fair to ask: "Who says so?" Obviously, we
are far from completely achieving this goal, but there has
been a lot of progress.
In Europe, all customers for telecommunication are gov-
ernment administrations. In 1965, they were inspecting every-
thing we did. They had resident quality people in every plant
we had in Europe, in every country. Today, they let us do the
final inspection and testing everywhere. In many countries,
they have actually issued us the inspection stamps, and just
audit once in a while. These administrations tell our competi-
tors that their operations should be as good as 1'lT's.

• The Russian Ministry of Electronics surveyed Western


quality management systems, and then came to ITT to
ask that we come show them how to do it.
12 THE UNDERSTANDING
• When McGraw-Hill was producing a new encyclopedia of
professional management, they asked ITT to write the
chapter on quality management

• American Express said five years ago that Sheraton was


the worst hotel chain when it came to quality. This year
they rate Sheraton as the best.

• Other companies continually ask for information. During


a typical year we receive over 400 requests in the cor-
porate office.

All these achievements represent the result of a great deal


of planning and plain, old-fashioned hard work. But it wasn't
just planning and hard work that made it happen. One of the
most vital components was our success in constructing the
first —top management commitment.
leg of the integrity table
One of the reasons I cheerfully share these programs with
other companies is that I know that many will probably not
be able to use them. Not because they are not capable, but
because they do not have a top management willing to be pa-
tient while the program is ground out four yards at a time. It
took five to seven years of unrelenting effort to achieve the
cultural revolution at ITT —
and I seriously doubt if it will
ever be eliminated there.
We recognize that our top management is special because
once they understood the realities of quality, they supported
the projects, participated in them, and encouraged us all the
way along.
The details of how, why, and what are contained in the
following chapters. This very brief overview of the strategy
behind the ITT program was put in only to show a little bit
about how the program all fits together. I know that if I had
had the Quality Management Maturity Grid several years
ago, the iob would have been finished earlier. I know if I had
had the ITT experience to play "show and tell" with, it would
have been less of a problem to obtain attention.
You have them. Take advantage of what has gone before.
Why not learn from the past?
"Quality May Not Be
What You Think It Is

There is no doubt in my
mind that those who pick up this
book are hoping it will contain some single piece of informa-
tion that will permit immediate clarification and ultimate reso-
lution ofall their problems with quality. Perhaps some wise
and perceptive sentence, like: "Quality is ballet, not hockey."
I wish could be so. Unfortunately, the business of quality
it

management is not all that easy. It isn't all that hard either,
but it does encompass more than a single gulp of philosophy.
It also requires unblinking dedication, patience, and time.
The problem of quality management is not what people don't
know about it. The problem is what they think they do know.
It is made difficult by the conventional assumptions about
quality that people develop over years of successfully making
a living in some line of work other than quality management.
In this regard, quality has much in common with sex. Ev-
eryone is for it. (Under certain conditions, of course.) Every-
one feels they understand it. (Even though they wouldn't
want to explain it.) Everyone thinks execution is only a mat-
ter of following natural inclinations. (After all, we do get
along somehow.) And, of course, most people feel that all
problems in these areas are caused by other people. (If only
they would take time to do things right.) In a world where
half the marriages end in divorce or separation, such assump-
tions are open to question.
It is difficult to have a meaningful, factual discus-
real-life,
sion on sex, quality, or other complicated subjects until some
13
14 THE UNDERSTANDING
basic erroneous assumptions are examined and altered. The
only ones who are usually willing to take that step are those
who are ready to admit they are in trouble, or have an intel-
lectual interest in improvement. I have had hundreds of dis-
cussions with operating managers over the years and can state
absolutely that their interest in quality is proportional to the
amount of profit-deteriorating situations they are experiencing
at that exact moment. I can't speak for their attitudes toward
sex.
Given the chance to explain quality management to people
who will listen, regardless of their motives, it is possible to
make a case for becoming deeply involved. No other action a
manager can take will generate improved operations, in-
creased profits, and reduced costs so quickly with so little ef-
fort. But before all that can occur, we have to examine the
thinking processes that lead some to believe that quality is
merely goodness that always costs more.
In discussing quality, we are dealing with a people situa-
tion. The entire concept of quality management in this book
is oriented toward that thought. People conduct the business
of every company, whether it is a foundry or a hotel. Each
individual performs an individual service. This service has
been identified, described,and assigned by the management
If the service is constructed and performed correctly, it fol-
lows that the operations of the company should be successful.
That applies to any industry or technology. I am not differen-
tiating between manufacturing quality and service quality. All
the quality actions we are talking about apply, regardless of
the business of the company. There are technological differ-
ences, but they really involve only the last few percentage
points of involvement. The programs defined in the following
chapters permit you to deal with those exceptions in a
planned fashion.
To understand those programs, and quality itself, in the
most practical terms, it is necessary that we deal with five er-
roneous assumptions that are held by most management indi-
viduals. These assumptions cause most of the communication
problems between those who want quality and those who are
supposed to effect it.
The erroneous assumption is that quality means good-
first
ness, or luxury, or shininess, or weight The word "quality" is
used to signify the relative worth of things in such phrases as
"good quality," "bad quality," and that brave new statement
"quality of life." "Quality of life" is a cliche because each lis-
"quality may not be what you think it is" 15

tener assumes that the speaker means exactly what he or she,


the listener, means by the phrase. It is a situation in which in-
dividuals talk dreamily about something without ever bother-
ing to define it.
That is precisely the reason we must define quality as "con-
formance to requirements" if we are to manage it. Thus,
those who want to talk about quality of life must define that
life in specific terms, such as desirable income, health, pollu-
tion control, political programs, and other items that can
each be measured. When all criteria are defined and ex-
plained, then the measurement of quality of life is possible
and practical.
In business the same is true. Requirements must be clearly
stated so that they cannot be misunderstood. Measurements
are then taken continually to determine conformance to those
requirements. The nonconformance detected is the absence of
quality. Quality problems become nonconformance problems,
and quality becomes definable. All through this book, when-
ever you see the word "quality," read "conformance to
requirements."
If a Cadillac conforms to all the requirements of a Cadil-
lac, then it is a quality car. If a Pinto conforms to all the re-
quirements of a Pinto, then it is a quality car. Luxury or its
absence is spelled out in specific requirements, such as carpet-
ing or rubber mats. The next time someone says someone or
something has "lousy quality," interrogate that person until
you can determine just exactly what he or she means.
The second erroneous assumption is that quality is an in-
tangible and therefore not measurable. In fact, quality is pre-
cisely measurable by the oldest and most respected of

measurements cold hard cash. Ignorance of this fact has led
many managements to dismiss quality with a wave of the
hand as something beyond handling. They are thinking of
quality as goodness and spend their time having emotional
discussions which make it impossible for management to take
specific, logical actions to attain quality.
Quality measured by the cost of quality which, as we
is

have —
expense of nonconformance the cost of do-
said, is the
ing things wrong. These costs are divided into prevention, ap-
praisal, and failure categories. But they all are a result of not
doing things right the first time. You can spend 15 to 20 per-
cent of your sales dollar on such expenses without even try-
ing hard. A company with a well-run quality management
program can get by with less than 2.5 percent of sales, w hich
r
16 THE UNDERSTANDING
is spent on the prevention and appraisal activities necessary
to make certain the company is maintaining its standards of
excellence. Measurements should be established both for
measuring the overall cost of quality and for determining the
current status of specific product or procedure compliance.
These measurements should be displayed for all to see, for
they provide visible proof of improvement and recognition of
achievement. Measurement is very important. People like to
see results.
There are those who will assume that some tasks are just
plain unmeasurable. To them, you must raise the question of
just how they know which people are the best at what jobs,
whom to fire, and whom to reward. Anything can be
measured if you have to do it.

The third erroneous assumption is that there is an


"economics" of quality. The most-offered excuse managers
have for not doing anything is that "our business is different."
The second is that the economics of quality won't allow them
to do anything. What they mean is that they can't afford to
make it an indication that they
that good. This, of course, is

don't understand quality and that they are just wishing you
would go away. Pressed, they will relate some case of "gold-
plating," where a designer made a product unsalable by insist-
ing on adding some luxury component. At that time, it is
proper to explain the real meaning of the word "quality" and
point out that always cheaper to do things right the first
it is

time. If they to make certain that they are using the


want
least expensive process that will still do the job, they should
get deep into process certification and product qualification.
These are part of a mature quality program. We mustn't get
faked out by words that have no meaning, and "economics of
quality" certainly has no meaning.
The fourth assumption that causes problems is the one that
says that all the problems of quality are originated by the
workers, particularly those in the manufacturing area. It is
hardly possible to find a business magazine that doesn't have
some sort of article about the falling standards of workers
and how lousy the quality is on the assembly line. Few qual-
ity professionals can discuss product conformance for very
long without emphasizing how people don't perform the way
they used to. In reality, the people in the shops work as well
as they ever did and much more productively than in the
past. They contribute a lot less problems than their white col-
lar brethren.

"QUALITY MAY NOT BE WHAT YOU THINK IT IS" 17

It is a matter of record that just as much crime is commit-


ted per person by middle- and upper-class individuals as by
people from the lower economic classes. In fact, the most ex-
pensive rip-oflEs, such as computer crimes, are committed ex-
clusively by the well educated. Yet it is accepted without
question by most people that ghettos produce criminals as
routinely as tomato patches produce tomatoes. People
"prove" this by pointing to prisons, where primary occupancy
is by people from low-income backgrounds.
The real reason for this is not that most crimes are com-
mitted by the poor, but that the police tend to look for crime
in areas where people are less mobile, more easily identifia-
ble, and less liable to offer a significant defense. (Of course,
there are a lot of people around ghetto areas who do wrong
things. But almost every successful executive I have ever met
claims to have originated in some "tomato patch" or other
so the tomato patch can't be all that bad.) The quality con-
trol people have much the same conditioning as the police.
They march blindly past the defects of accounting, engineer-
ing, computer programming, and marketing on their way to
the manufacturing ghetto to look for errors. And, by golly,
they find a lot of them out there. It is an important place to
look for ways to lower unnecessary costs. But the people in
the manufacturing ghetto can contribute only a little to the
prevention of problems because all planning and creation is
done elsewhere. And it is the "elsewheres" that need attention
when it comes to reducing the cost of quality. You will find
the causes of most of our expensive problems at the other
ends of pencils and telephones.
The fifth erroneous assumption is that quality originates in
the quality department. Unfortunately, most quality profes-
sionals feel that they are responsible for quality in their com-
pany, so this assumption is really entrenched. However, the
high attrition rate of quality management people who insist
on being responsible for quality problems should make us
think a little. People who insist that "quality problem" means
that the quality department made a mistake of some sort are
laying a clear, if inaccurate, track back to their teepee. They
must learn to call problems by the names of those who cause
them: accounting problem, manufacturing problem, design
problem, housekeeping problem, front-desk problem, etc.
Otherwise they will be held responsible for resolving prob-
lems over which they have no control.
Quality department people should measure conformance by
18 THE UNDERSTANDING
the various means at their disposal; they should report results
clearly and objectively; they should lead the drive to develop
a positive attitude toward quality improvement; they should
use whatever educational programs can be helpful (such as
Zero Defects, Make Certain, and others described later in this
book). But they should not do the job for others, or the oth-
ers will not change their evil ways.
This is the primary weakness of modern professional qual-
ity management. The desire to be actively involved in the
creation, production, marketing and managing of a com-
pany's product or service is almost irresistible. But it only
takes a little involvement to destroy the objectivity that is the
quality professional's most precious possession. Once integrity
is compromised, it does not return to its original pristine
state.
It is not an easy thing to refuse a good friend who tear-
one more drink. But you must do so if you
fully begs for just
are to keep that person alive. Similarly, you do no one a fa-
vor when you create new "temporary" requirements on the
spot The designated requirements are either met or they are
not If we don't need a criterion, and the customer doesn't
need it, then have the requirements officially changed but —
go through the system and make certain that no step has been
left out.
Now let's get to the business of what quality management
can do for a company. It may be helpful to begin with an
analogy. Each day, thousands of people board hundreds of
airplanes and fly to dozens of cities. With few exceptions,
these planes arrive and depart as planned and few injuries oc-
cur. Meals are served and consumed; movies are projected
and viewed; drinks are offered and drunk; storms are spotted
and avoided; and many personal services are provided.You
are safer riding in a commercial airliner than sitting in your
home.
However, suppose that these same activities took place
with the pilots and other crew members not on the plane.
Suppose the crew were in an office building somewhere, fly-
ing and managing the aircraft by remote control. Suppose
they first issued each order to subordinates who then trans-
mitted the instructions to the autopilot equipment.
Suddenly, we are faced with a new equation. The concept
of flying has changed dramatically. Under the present system,
the pilot goes along with you. If you crash, the pilot crashes.
When the pilot is subject to the same fate as the passenger,
"QUALITY MAY NOT BE WHAT YOU THINK IT IS" 19

he or she is bound to be personally concerned with every de-


tail. But if the pilot were managing from an office, he or she
would not crash when the plane went down. The pilot might
be investigated after a crash, but it would never be all that
clear whether the pilot, a subordinate, the system, or perhaps
one of the in-flight passengers was at fault
If you were going to travel under those circumstances, you
would want to make certain that every plan, every control,
every consideration was tested, controlled, and audited. You
would want the most competent and professional manage-
ment of every aspect of the flight. You would want to make

certain that everything was done exactly right the first time.
Quality management is a systematic way of guaranteeing
that organized activities happen the way they are planned. It
is a management discipline concerned with preventing prob-
lems from occurring by creating the attitudes and controls
that make prevention possible.
Quality management is needed because nothing is simple
anymore, if indeed it ever was. Our sophisticated business
world is like those planes flying by remote control with in-
structions filtered through layers of subordinates. The people
who really control activities do so from offices, laboratories,
studios, and other remote places. The further the administra-
tor gets from the administered, the less efficient the adminis-
tration becomes.
Although individuals at lower levels can add to the deterio-
ration of a process, there isn't a great deal they can do to im-
prove a product or service. Itmakes you wonder why so
much attention is given to improvement in those areas and so
little management and administration. If effective
to quality
management is to be practical and achievable, it must start at
the top.
This book is set up to provide you with a way of measur-
ing the exact status of your present quality program and to
show you what positive steps you can take to evaluate and
improve that program. The evaluation system, the Quality
Management Maturity Grid, is explained in detail in the next
chapter. The grid was used through all the various industries
of ITT, and was successful in every case. The beauty of the
system is that you don't have to be a professional quality type
to apply it. All you have to do is know what is going on in
your company. (If you don't know that, then the problem is
different.) Each stage of maturity is covered in enough detail
so you will be sure to recognize some of your operations. But
20 THE UNDERSTANDING
don't rate yourself too high at first. Once more information is
available you may find that you are not quite where you
think you are. It is said that the difference between an op-
timist and a pessimist is that the pessimist has more data.
After the grid chapters, a detailed case history on quality
improvement is given. This case is one that can be role-
played with other members of management, if you wish, and
it works very well as a teaching aid. But its real purpose is to

display the logic and philosophy of quality improvement so


that it can be understood clearly. I recommend that you give
the chapter on management style special attention. After all,
quality management really is more like ballet than hockey.
The Quality Management
Maturity Grid

Management is the function responsible for establishing the


purpose of an operation, determining measurable objectives,
and taking the actions necessary to accomplish those objec-
tives. Although management is usually thought of as having
to do with chartered corporations or organizations, it operates
elsewhere also.
Managing a family, for instance, is probably the most diffi-
cult of all jobs. It is clear that very few have been completely
The small number of people who actu-
successful at that task.
ally achieve their hoped-for potential could be explained as a
matter of random success, considering the billions of individ-
uals who have lived in the past and the billions who are liv-
ing now. Somebody has to succeed!
The family suffers from three primary obstacles when it
comes to management The first is that the members of the
organization are brought aboard without benefit of personal
evaluation, psychological testing, or any of the other tech-
niques that formal organizations use to screen employees.
Thus, each member is an unknown quantity.
The second is that you are sort of stuck with the family
group. If your three-year-old gives you a hard time, you can't
fire her or toss her out in the snow. The neighbors will toss
the child right back in. The hold that family managers have
on their family personnel has an emotional and circumstantial
base, and emotions and circumstances are changing all the
time.

21
22 THE UNDERSTANDING
Third, the family managers, and in fact the family itself,
are not trained for the job. They have no methods of measur-
ing performance except in terms of their own limited experi-
ence. They are required to provide financial means, security,
and educational activities, often without having had the
chance to learn by experience or practice. Once they do learn
how to do the job, they are classified as obsolete and are
forced to sit back, while not interfering, as the children take
their turn at family management.
Families and business operations have a great deal in com-
mon. Both are people-oriented, and both have difficulty in
measuring some important aspects of their progress. Family
management measures everything against the manager's per-
sonal standards. Thus, approved activity is always several
fads behind. The children like one kind of music, the adults
like another.
Measurement becomes a matter of defining the "enti-
tlements" and expectations of human existence. What are the
members of each generation entitled to receive? What can
they expect as their right from the family and what are they
expected to contribute? As families grow more affluent
through the years, the specifics change. Grandpa may have
felt he was entitled to take the plow horse to school, riding
with two siblings. Granddaughter may feel that each sixteen-
year-old deserves her own car. Mother, who assumes her
right to household conveniences, may also feel that she
should receive unceasing adoration from each member of the
group.
All individuals have developed some idea of the things so-
ciety ought to provide for their physicaland emotional well-
being. A
very few may have some idea of the things they
should accomplish to attain those goals, or what they should
give to others.
Families have difficulty setting goals, measuring per-
formance, and accomplishing tasks. Like all human beings,
they are also faced with difficulties of communication, diffi-
culties that are compounded by emotional involvement.
Quality management has always been looked at as a sub-
jective operation, hard to define and measure. That is because
it has been relegated to the role of a results-oriented pro-

cedure rather than a planning operation. Just as the folklore


of family management states that if you don't spoil children,
and are sure to raise them with loving discipline, they will
turn out to be good, so the folklore of business management
THE QUALITY MANAGEMENT MATURITY GRID 23

states that if you have good in your heart, you will produce
quality.
have no desire to poke fun at these platitudes; they aren't
I
all wrong. But you know from your own experience that it is
a rare parent who doesn't feel that he or she has given a
child the best possible upbringing under the circumstances.
We kid ourselves into thinking that if our offspring had only
listened more intently to us, things would have been better
for them. Finally, however, no one knows any way to
guarantee the best for their children, so parents take their
chances and do the best they can.
However, quality management has just become too impor-
tant to leave to chance. In this day of crushing taxation, mys-
terious methods of accounting, rollicking inflation, and
unsettled politics,it may be that quality is the last chance we
have to make profits controllable. But if quality is to be a
"first among equals,'* then management must have a way of
measuring and controlling. You will not be surprised to know
that I have developed just such a system.
Using the Quality Management Maturity Grid, even the
manager who isn't professionally trained in the quality
business can determine where the operation in question stands
from a quality standpoint. All that is required is knowing
what is going on. If the manager doesn't know that, then we
are both in the wrong book.
For years I have been saying, every way I could think of,
that quality is too important to leave to the professionals.
Professionals must guide the program, but the execution of
quality is the obligation and opportunity of the people who
manage the operation.
However, I just didn't have enough objective evidence to
convince everyone. Every step of achievement was done the
hard way. We had to kill a mouse before they would give us
a rat-catching license. Eventually, we worked our way up to a
dragon a week. This method requires eight to ten years from
the first conversation to a completely implemented quality
program. It is never possible to assume that the program will
continue to prosper. Every day requires the identification and
destruction of new menaces. If you can't produce a dead
dragon each week, your license may be revoked.
Robert Burns wished that we could be given the gift of
seeing ourselves as others see us. Many of us echo that
thought, probably because there is little chance of it happen-
ing. After all, our own version of ourselves is usually more
24 THE UNDERSTANDING
flattering than that of others, and most people really don't
want know the truth about themselves.
to
Not many people really want to know the future, either,
especially if it might hold disaster. Those who can predict the
future have never been appreciated in their own times. His-
tory, mythology, and real life are full of situations where

someone warned others of events about to happen only to
be scorned or ignored. Noah and the flood; Cassandra and
the Trojan horse; Churchill and World War II; the list goes
on and on.
People would rather handle the expected and mundane
chores of today, like making a living. Typically, as individu-
als go through life, they collect a store of cliches and experi-
ences that serve as a memory bank to draw on in handling
situations as they arise. New thoughts or unfamiliar ideas
must survive their encounter with this memory and experi-
ence library. Otherwise, they are cast aside as being un-
worthy.
It is this test of worthiness, this comparison with the past,
that causes problems in the development and implementation
of new thoughts and programs. Changing mind sets is the
hardest of management jobs. It is also where the money and
opportunity lie.
Take quality management in its truest sense as a "for in-
stance." The purpose of it is to set up a system and a man-
agement discipline that prevents defects from happening in
the company's performance cycle. To accomplish this you
have to act now on situations which may cause problems
some time from now. Act now for reward later.
Management has to commit money this year to conduct
quality testing so there won't be problems two years from
now. A training program that costs a lot of time and money
and may produce benefits must be established right away. In-
spections and tests and corrective actions have to be accom-
plished before problems become big enough to become
disasters.

Prevention like this is not hard to do it is just hard to
sell. Itrequires the ability to convince people that bad things
will happen to them if they don't take early action. Most of
us are unable, or unwilling, to accept such things intellectu-
ally, and are convinced only on the basis of experience.
But to wait until a failure is unassailable before learning
from experience and only then advancing one more step is
too much to expect of anyone. A career could be over before
THE QUALITY MANAGEMENT MATURITY GRID 25

a person had the chance to experience each and every thing


that can go wrong.
That is the frustrating part of it all. How can you bring the
top operating people in your company, the ones with the
money to spend or withhold, the ones who get to decide who

does what how can you bring them around to understand-
ing quality management and all the things it can do for
them?
Until the development of the Quality Management Matur-
ity Grid, this conversion process was exclusively a function of
the personal charm and convincing attitude of the quality
management professional. If people liked and trusted the
quality manager, things got done. However, even though
good results produced evidence that the system worked, they
did not necessarily guarantee the quality manager's right to
increase efforts for prevention. It is a strange thing, this
business of success not breeding more opportunity, but many
management people have been frustrated by it
In many cases, for instance, a value analysis job produces
outstanding cost reductions, design improvement, and true
profit growth. However, the next time such a study is pro-
posed, it is met with blank stares. Success in these functional
areas does not seem to provide a foundation on which to
build further successes. Apparently, it is a matter of what
particular effect is needed in the business at a particular time.
The need for long-range programs in quality can be
deduced intellectually through the Grid. A manager of any
operation can spend a few moments with the Grid, recognize
familiar events, and pinpoint where the operation is at that
moment. Then all that is necessary is to refer to the following
stage of the Grid in order to know what actions need to be
taken for improvement. And in the cases where an es-
tablished program is now deteriorating, the Grid can be read
backwards. You can see the last point at which you were suc-
cessful and figure out how to get back there.
The Grid is divided into five stages of maturity. Six man-
agement categories serve as the experience relations you must
go through to complete the matrix. By reading the experience
condensed in each block, it is possible to identify your own
situation.
All of this recognizing is done unemotionally and without
anyone else knowing about it. Even if pride causes a little
clouding of the exact status, it will usually only cloud to the
extent of one stage, unless you are completely kidding your-
26 THE UNDERSTANDING
self.That still means improvement is necessary. Said im-
provement can be recognized when it comes.
To become familiar with the Grid, it is necessary to recog-
nize the content of each stage of maturity. Stories and case
histories are utilized in the following chapters to assist you in
gaining this understanding. But you can know from just look-
ing down the columns that the stages have a definite recogni-
tion pattern. I like to call the behavior at each level by its
"stage" name.
Stage 1, Uncertainty, is indeed confused and uncommitted.
Management has no knowledge of quality as a positive man-
agement tool. They speak regularly of their quality function
in terms of being the policemen, or "gumshoes," whose job it
is to catch the criminals in the act. Problems of noncon-

formance are considered the fault of not being tough enough


on the "bad guys." Uncertainty learned management control
from the Clint Eastwood movies.
Uncertainty casually places the quality function deep in the
bowels of one of the operating departments: manufacturing,
administration, operations, engineering, and so on. Inspection
is sometimes a separate operation and is assigned to the pro-

duction people so they "can have the tools to do the job."


These restrictions create the self-fulfilling prophecy that un-
solved problems will always be around. Every problem is
considered unique, even if it has been encountered before.
Problems breed problems, and the lack of a disciplined
method of openly attacking them breeds more problems. The
result is emotion on the management level. The question be-
comes "who," rather than "what," caused the difficulty. Per-
sonalities are the predominate factor in problem attacking.
This sometimes results in illogical firings and quittings as it
becomes impossible to methodically examine a situation and
solve whatever problems exist.
The cost of quality is not in the Uncertainty glossary,
probably because local quality management doesn't know
very much about it. However, anyone bringing up the subject
will receive an audience if for no other reason than that it
will be something no one has considered before. This is the
key to starting some action in this type of company.
But quality improvement will never be part of a company
in the age of Uncertainty. These companies are somewhat
like alcoholics, whose number one symptom is emphatic
denial that the condition exists. Therefore, improvement is
not considered as an option. Uncertainty-age companies know
THE QUALITY MANAGEMENT MATURITY GRID 27

they have problems but don't know why, although they do


know it isn't because they aren't working hard. Everyone in
Uncertainty works hard, and most are frustrated at the
amount of brute force it takes to keep the operation moving.
Stage 2, Awakening, is more pleasant, but no less frus-
trating. Here management is beginning to recognize that qual-
ity management can help, but is unwilling to devote the time
and money to make it happen. If pressed into strengthening
the quality operation, they will opt for putting one of the
"gang" in that job. Selection is done on that basis because of
the mistaken idea that the need for someone who understands
the product or service is greater than the need for someone
who understands professional quality management.
Awakening hasn't awakened enough to recognize that qual-
ity management takes more than understanding the technical
aspects of a product or service. At this stage, however, in-
spection and testing are performed more often, and problems
are identified earlier in the production cycle. This cuts rework
costs a little while permitting some attention to resolving
problems.
Chronic problems are listed and assigned to teams for ac-
tion, although prime attention is still paid to keeping the pro-
duct moving. In service companies the customer is cajoled
more at this stage. Service problems are corrected quicker
But the basic problems are still not solved. Teams set up to
attack problems accomplish quite a bit, but their scope is lim-
ited to the near future. Long-range solutions are not con-
sidered seriously.
An interesting thing happens when the cost of quality is
calculated for the first time. The quality manager, having
read a paper or attended a course, sits down with the comp-
troller to calculate this number. They assume the walls are
coming down about them and they do a very detailed calcu-
lation, only to find that the cost of quality is very small. It
may only be 3 percent of sales or less, which is the level that
really well-run companies aspire to achieve. This often serves
to convince everyone that things aren't as bad as they seem
because "we can prove it by the number." However, as they
will find out much later, they have been fooling themselves.
They just don't include everything they are supposed to
include.
Take inspection, for instance. In an Awakening company
the inspection is conducted by a lot of different people in a
lot of different areas. Because the quality department is so
28 THE UNDERSTANDING
disorganized, when they are calculating inspection costs, they
don't include the people who do adjustments and similar
measurements on the production line. They don't include the
burden on all inspection ictivities, and they probably don't
include the inspectors who are working for manufacturing.
Awakening's warranty costs, for instance, include only the
expense of replacing the product with a new unit. That is just
the shop cost. How ibout all the correspondence? How about
the repair time, the handling, the everything else? It is enough
at this point to say that about one-sixth of what really exists
will be calculated. That will be all they can find. But it is a
start.
Awakening comes to life when the magic of motiva-
really
tion has been sold. The idea is that if you hang up posters
and have a contest, you will get people turned on to quality;
then things will get better. The fact is that people do enjoy
entertainment and attention, and so they will respond for a
few days. Then they tire of it and go back to what they were
doing before.
So Awakening will put together a motivation package.
They will make a few speeches and have a special lunch and
even talk to the people. Immediately the results of this com-
munication show themselves. Every measurement chart shows
improvement But it only lasts a little while—just long
enough, in fact, for the employees to recognize that the ef-
fects of the effort are really short-term.
Realization of this usually causes Awakening to reevaluate
the commitment to improvement, and may drive the com-
pany back into the Uncertainty stage. Complete regression is
possible when the shock sets in. However, the employees of
the company will usually offer encouragement and urge
Awakening to continue stumbling along on the path of qual-
ity improvement The employees have a much more practical
view of things. They know instinctively that the company has
to offer more constant quality in service and product alike or
its very be threatened.
life will
Suchthe hard life of Awakening.
is
The stages of quality maturity do not provide individual
guided tours like Scrooge's ghosts. They are easily identifia-
ble, but they have no particular schedule. Lack of attention
or a management change can quickly send Wisdom crashing
to Awakening.
However, there isa moment when you can tell precisely
when one stage is entered. Enlightenment appears with the
THE QUALITY MANAGEMENT MATURITY GRID 29

decision to go ahead and really conduct a formal, regulation,


card-carrying quality improvement program. With the es-
tablishment of a regular quality policy, and the admission
that we cause our own problems, management enters the
stage of Enlightenment.
In making this commitment it is necessary that Enlighten-
ment establish quality department as a balanced, well-or-
its

ganized, functioning unit. This group is to lead the crusade,


and it must have the capabilities and resources to do so. All
inspection and testing, quality engineering, data reporting,
and similar activities must be included. And the department
must have a quality education budget.
One of the most recognizable changes in the Enlightenment
stage involves the approach to problem resolution. Facing
problems openly, without searching for individuals to blame,
produces a smoothly functioning system for resolving those
problems. Systems, of course, are only road maps; it is per-
sonal enthusiasm that makes them work or fail. When task
teams are responsible for both resolving a current problem
and preventing it in the future, they respond enthusiastically.
Constant reassurance is necessary if people are expected to
work into the future. They need to know you understand
about gestation, birth, growth, and death.
The cost of quality will now get its first fair evaluation.
Those who do the calculating will still miss a third of the
costs, but they will develop a reasonable enough estimate to
provide direction for cost eliminations. Nothing is quite so ef-
fective as having cost data to show competing areas that one
department has more effective methods of reducing costs than
others.
And, of course, quality improvement is now headed up by
an official quality improvement team, headed by someone
other than the quality director. This team takes the time to
understand the content and intent of each step before
launching it. Their purpose is to establish a system and atti-

tude that will last for a long time one so well entrenched
that it would take a hard-working quality reduction team to
deactivate it.

Enlightenment still has problems and will have them for


some time. But the quality team now feels confident that
there is indeed a light at the end of the tunnel, not another
train coming at them.
Wisdom is another matter altogether. Those involved
deeply in this stage, and there aren't all that many of them,
30 THE UNDERSTANDING
find themselves wondering why they used to have all those
problems and why the quality department always lived in the
other room. Things are basically quiet. Cost reductions are in
effect: when problems appear, they are handled and they dis-
appear. This is the point that every political administration
strives to reach but usually does not because time runs out
before it happens. Wisdom is the stage at which the company
has the chance to make the changes permanent. Because of
this, it may be the most critical of all the stages.
The quality manager usually receives a promotion, proba-
bly being made a vice president of the company. This can lull
the manager into thinking about more exotic things than the
constant pressure needed to maintain quality improvement.
The reduction in management "noise" is in itself a temptation
to reduce the efforts that brought the changes about.
Problem handling may be passed down to the lower levels
of the organization, and checks on progress may be bypassed.
This c*m cause the return of a "whodunit" type of organiza-
tion. Incisive, in-depth reviews must continually be conducted
on a "no mercy" basis. Relaxation of this practice is a sign of
weakness.
Wisdom reports the cost of quality more accurately than
any of the previous stages. The absolute number of dollars
saved by paying attention to the cost of quality is usually far
more than anyone expected. In many cases quality manage-
ment has been thought of as just another measuring system
with a clumsy title and definition. Now the company is find-
ing that quality control is real, and people may expect too
much too soon.
Wisdom is a great time to be running a company. Any task
you want accomplished can be tackled successfully. The atti-
tude, the iystems, and the enthusiasm are all there waiting.
As long is these three are not taken for granted, they will
continue to produce.
You will know a Certainty company if you ever see one. It
is all summed up in one sentence: "We know why we do not
have problems with quality." What a delightful Buck-Rogers-
in-the-twenty fifth-century comment! But it can be done; I
know a few operations that have accomplished it
Certainty considers quality management to be an abso-
lutely vital part of company management. In fact the quality
honcho is a member of the board of directors. In Certainty
companies problem handling may become something of a lost
art Certainty's prevention system is such that very few sig-
THE QUALITY MANAGEMENT MATURITY GRID 31

nificantproblems ever actually occur. The cost of quality is


down to where it consists almost entirely of the compensation
for quality department members and the costs of proofing
tests.
The quality improvement team is restructuring and recy-
cling for the umpteenth time. Their most important project
may be inviting all those who have served on the team at one
time or another to come to a picnic during the summer.
It is a long, long way from Uncertainty to Certainty. But
traveling that road is what the fun of management is all

about.

The Grid As a Comparison Measurement


If you would like to use Grid measurement to compare dif-
ferent operations, keep in mind that the purpose of compari-
sons is to get those moving who aren't moving. It is not
simply to report the results.
The company, division, or whatever should be rated by
three individuals: the quality manager of the operation, the
general manager of the operation, and a staff member who is

not assigned to that location.


Have the individuals mark the Grid in the appropriate
blocks. They should check the stage they think their oper-
ation is in for each of the six measurement categories. Let
them know that you recognize that the evaluation is a subjec-
tive one, but that they are paid to be managers, and man-
agers are mostly subjective. Award a point value for each
stage according to its number. One point for an Uncertainty
mark; two points for each Awakening mark; and so on. The
maximum possible score is thirty. If someone comes up with
thirty points, have an awards dinner and forget the whole
thing.
If you handle the Grid right, you can use the comparison
between the three individual raters to provide a motivation
for becoming involved in improvement. You may be sur-
prised to find that the general manager usually gives the com-
pany a lower rating than the quality manager. General
managers have a better view of the herd.
The Grid is at its best when used to project a view of the
company that all involved can accept. For this reason it is
valuable in comparing the status of different companies or
divisions. It also provides a continual source of direction
32 THE UNDERSTANDING

QUALITY MANAGEMENT MATURITY GRID

Rater

Measurement Stage I: Stage II:


Categories Uncertainty Awakening

Management un- No comprehension Recognizing that


derstanding and of quality as a man- quality manage-
attitude agement tool. Tend ment may be of
to blame quality value but not willing
department for to provide money or
"quality problems." time to make it ail
happen.

Quality organiza- Quality hidden in


is
C A stronger quality
n
tion status manufacturing or leader <s appointed
engineering depart- but main emphasis
ments. Inspection is still on appraisal

probably not part of and moving the


organization. Em- product. Still part of
phasis on appraisal manufacturing or
and sorting. other.

Problem handling Problems are fought Teams are set up to


as they occur; no attack major prob-
resolution; inade- lems. Long-range
quate definition; solutions are not
lots of yelling and solicited.

Cost of quality as %
accusations.

Reported: unknown Reported: 3%


n
of sales Actual: 20% Actual: 18% [

Quality improve- No organized activ- Trying obvious


ment actions ities. No under- "motivational"
standing of such short-range efforts.
activities.

Summation of com- "We don't know why


n "Is it absolutely
n
pany quality pos- we have problems necessary to always
ture with quality." have problems with
quality?"
THE QUALITY MANAGEMENT MATURITY GRID 33

Unit

Stage III: Stage IV: Stage V:


Enlightenment Wisdom Certainty

While going Participating. Un- Consider quality


through quality im- derstand absolutes management an es-
provement program of quality manage- sential part of com-
learn more about ment. Recognize pany system.
quality manage- their personal role
ment; becoming in continuing em-
supportive and phasis.
helpful.

Quality department Quality manager is Qualitymanager on


reports to top man- an officer of com- board of directors.
agement, all ap- pany; effective sta- Prevention is main
praisal is incorpo- tus reporting and concern. Quality is

rated and manager preventive action. a thought leader.


has role in manage- Involved with con-
ment of company. sumer affairs and
special assign-
ments. r
Corrective action Problems are iden- Except in the most
communication es- tified early in their unusual cases,
tablished. Problems development All problems are pre-
are faced openly functions areopen vented.
and resolved in an to suggestion and
orderly way. improvement.

Reported: 8% Reported: 6.5% Reported: 2.5%


Actual: 12% Actual: 8% Actual: 2.5%
Implementation of Continuing the Quality improve-
the 14-step pro- 14-step program ment is a normal
gram with thorough and starting Make and continued
understanding and Certain. activity.
establishment of
each step. r
"Through manage- "Defect prevention "We know why we
ment commitment is a routine part of do not have prob-
,,
and quality im- ouroperation. lems with quality."
provement we are
identifying and re-
solving our prob-'
lems."
34 THE UNDERSTANDING
concerning what needs to be done next. Managers may come
to use the stages of maturity as a sort of verbal shorthand.
* We're just entering Enlightenment."
**We were Enlightened for a couple of years, then we got a
new general manager who thinks quality is expensive. We'll
have to drop back a stage or two until he gets educated."
Management
Understanding and Attitude

A CASE HISTORY
Harold Gooding peered around the corner of the tool crib
wall, nervously scanning the machining area before entering.
He did not want to meet Austin Welding, the general supervi-
sor. Austin would want him to stay late that evening, on his
own time, to dispose of a table full of parts that had been re-
jected by Inspection. Harold had plans of his own.
Every time a batch of bad products showed up, Austin and
the other manufacturing supervisors acted like it was a per-
sonal vendetta instigated by Inspection. As the one and only
quality engineer. Harold tried hard to get problems identified
and corrected, but they were so numerous, and sometimes so
complicated, that they would often come around again before
they had been entirely resolved the first time.
Harold turned to see Austin bearing down on him. His
plans began to evaporate. The old arguments would start
anew. Austin would drag him to the table and they would go
through each rejection one at a time. Austin would argue that
it wasn't all that bad, or that it could be reworked, or that

the specification had been unreasonable, or something. He al-


ways saved the worst part till last, when resistance was
lowest. Harold didn't look forward to another evening of
playing referee.
He held up his palm to the advancing foreman.
"Back dark spirit, in the name of Helen of Troy I com-
35
36 THE UNDERSTANDING
mand that you return to that black and mysterious cave from
whence you emanated. Bother me no more. Disappear, I
command you."
Austin flung an arm around Harold's shoulder.
"Come on, little buddy, you don't really mean that. I know
you want to get out of here to go to a meeting. The items I
want to look at won't take but a moment of your time. Then
you can be on your way. There are only twenty-five or so of
them."
Suddenly a flash of light appeared on Harold's memory
screen. He was inspired. Perhaps there was a way out of this
mess.
"Austin, I'll make a deal with you. I am on my way to the
ASQC meeting."
Austin looked blank.
"American Society for Quality Control. All the quality pro-
fessionals in the area belong to it. We meet now and then to
conspire against guys like you. Tonight we have a guest
speaker who is going to talk about taking the opinion out of
rejections. Are you interested in taking the opinions out of re-
jections?"
"Am I? I sure am. If we could resolve all these opinion
thingsmy job would be easier. I wouldn't have to chase all
over the place looking for quality engineers to sign off on the
things the inspectors find.
silly little Am I for eliminating
opinions? I'm more for that than anything I can think of."
Harold smiled to himself.
"OK, I'll make a deal with you. The cocktail part of the
meeting starts in half an hour. Then there is dinner and the
speaker. The whole thing will be over by 9 p.m. You go
along with me, and if you still want to come back here and
process these parts after the meeting, I'll come with you."
"You want me to go with you and spend the evening with
a bunch of quality types? I might lose my professional stand-
ing. However,if it would get these problems solved, and if
you'll pay, go."
I'll

During the cocktail hour Harold watched nervously as


Austin chatted with various members. Everyone thought it
had been a good idea to invite him, and a few resolved to
take a similar step for the next meeting. At dinner Austin
entertained the table with a few amusing stories about the
toe-to-toe battleshe and Harold had conducted. Laughing,
each of the others agreed that their life was very much like
that also.
"
MANAGEMENT UNDERSTANDING AND ATTITUDE 37

"I guess we have chosen a line of work that just naturally


requires purposeful conflict to make it work/* commented
one member. "It seems to produce stronger people, and I
think the interface is positive.'*

"I'd like to hear the speaker comment on this," said an-


other. "He is all wound up in definitions as I understand it
In fact the chairman told me that his subject is 'What does
quality mean?'
Austin smiled. "Trouble, that's what quality means.
Trouble."
He then held forth for about fifteen minutes, good-na-
turedly kidding the table about the well-known impracticality
of quality people.
"If you guys would be reasonable, we could double pro-
duction in this country overnight. Then we could all have
more time for fellowship dinners and educational programs."
At that moment the chairman called the meeting to order
and, after introducing several committee members who made
status reports, he let the program chairman introduce the
speaker.
"Mr. Wilson," said the program chairman, "is the vendor
quality manager for Albiex Corporation, which as you know
manufactures specialty engineering items. I have heard Bill
say many times that he runs the world's biggest job shop.
Anyway, his present job requires that he deal with hundreds
of suppliers and customers. He has been successful in doing
this, and as a matter of fact, since I happen to be one of his
customers, I can say without polishing him up that he and his
people are straightforward about dealing with us. They call a
spade a spade. Here is Bill Wilson."
Wilson came to the podium as the group offered polite ap-
plause.
"I come to you tonight under false colors. My subject is
'What does quality mean?' and that is what I meant to speak
about when I agreed to do this, which was a year ago. At
that time it was all very clear to me what quality meant, how
you got it, and everything about it. After all, I'd been in the
business for fifteen years.
"However, last spring we decided to make a little booklet
for our suppliers that would help them understand our re-
quirements and methods better. Nothing too spectacular, just
a booklet on the basics of dealing with our company.
"Well naturally the first thing we wanted to put down was
a list of definitions. After all if you can't define something
38 THE UNDERSTANDING
you can hardly discuss it. The first word on the list to be de-
fined was quality. That was six months ago and we have just
now arrived second word."
at the
Al looked questioningly at Harold. His eyebrows arched
enough to intimate that the two of them would be smart to
ease themselves out the door. Obviously they were in the
company of a dummy.
Wislon continued. "The usual definitions just didn't seem
to come clear to me. Defining quality as 'desirable character-
istics,* 'subjective evaluation,' and other phrases just didn't
seem right. After all, I didn't want to be known as the desir-
able characteristics manager.
"I began to get a little panicky. All those years in the
business and I couldn't even tell anyone what it was I did.
"We looked at some of the modern definitions. 'Fitness for
use' has a nice ring, and in fact has a lot of meaning particu-
larly when you are talking about the design concept of a
product. If you think about a toaster, for instance, 'fitness for
use' immediately brings a lot to the top. You need handles,
and connections that won't break even when they are used
incorrectly, and a shine that will stay, and coils that do the
job in the correct time period. It is a valuable concept.
"But that isn't what we are doing. We are buying and man-
ufacturing things. The design and concept decisions were
made long ago. When our program manager gets an order
from us, he only wants to know what we want, how many,
and when. He is not too concerned about how we are going
to use it or the 'fitness for use' evaluation.
"In short, we had to come up with something we could use
in practical terms that everyone could understand and that
we could use to do the job. As one of my people put it, 'We
need something you can use to make a living.* She was so
right.
"So we went back to the basics. We asked ourselves just
what the quality function does, and why?"
("I wonder that myself sometimes," muttered Al under his
breath.)
"We kicked around ideas about defect prevention and tak-
ing measurement and corrective action and all that stuff. Fi-
nally we reached a combined conclusion. And this conclusion
produced our definition of quality. I promise that once it
sinks in, you will never look at things in the same way again.

"We decided we were in the business of causing and


MANAGEMENT UNDERSTANDING AND ATTITUDE 39

measuring conformance to the requirements. Therefore, qual-


ity means conformance. Nonquality is nonconformance.
"Suddenly the whole thing becomes clear. Instead of think-
ing of quality in terms of goodness or desirability we are
looking at it as a means of meeting requirements.
"Now you have to accept the fact that this puts us, as
quality professionals, out of the design business we all love so
dearly. We are no longer accepting or rejecting characteristics
based on our judgment of whether or not they are good
enough, or even necessary. Many of us were used to telling
manufacturing that they could use something not quite to
tolerance because we knew that the thing was too tight to be-
gin with. We can't do that any more. It's conformance or
nonconformance and that is it."
The group began to fidget a bit at this point, and several
little discussions broke out quietly at the various tables. Wil-

son noted this and smiled.


"I see that some of you are reacting to this thought. I as-
sure you that this is only normal. Suppose we stop right here
and go into the question and answer session."
He looked at the chairman, who nodded approval.
"OK, let's have the first question."
"I understand the process you went through to get to this
definition of quality, Bill, and I think that you and your group
are to be congratulated in doing such a fine analysis. How-
ever, you don't really expect to implement this definition as
policy for your company, do you? After all, you have to be
practical."
"We think this very practical, and it is also easy to un-
is
derstand. Why do youfeel it would be a problem?"
•Well, for one thing, it would stop any production line
cold. Nothing else would ever be produced anywhere. No

design is perfect you always have to make some al-
lowances."
Bill nodded.
"I agree that designs are far from perfect and that correc-
tions need to be made. But how are you going to get those
corrections made until you find the problems and identify
them? Once all the corrections have been implemented the
product moves right along.
"Just the other day I ran across something that really made
me take notice. We were running behind in the machine
shop, and so we took some parts we had been making for
years and put the raw material plus the paperwork in a box
40 THE UNDERSTANDING
and sent it out to a very good machine shop. You know
what? They couldn't make them. If you did it just like the
print it didn't compute. No way. All kinds of little variations
were involved. And none of them were written down. We
found that we have several very proud craftspeople in our
shops who know just how to shave a little here and there in
order to make a product come out usable in spite of faulty
specifications.
"Do you realize how horrible that was? The company man-
agement didn't control the place anymore. They were at the
mercy of the mister fixits in the shop, who were glorified by
the leaders we had selected to direct them. As all this sunk
in, I became quite depressed about it.
"I made my presentation at the general manager's staff
meeting and it was received with blank looks. Nobody
seemed to realize the impact of what I was saying. They
could hardly wait for me to finish. Imagine! There I was with
the, greatest discovery of my career, and they couldn't pos-
sibly have cared less. If it's common knowledge it isn't
important
"But you see, if you can't count on producing something in
your manufacturing areas that looks like what you designed
in engineering, then the whole business is a useless waste. No
one knows what is going out the door. So all the marketing,
surveying, research, warranty planning, and five-year plan-
— —
ning the whole thing is just a farce if we don't make it
like the drawings, so we can see if it will work."
As Bill leaned forward, his voice dropped and there was
mist in his eyes.
"There is no use running life tests and all that other stuff
on things that may not even look alike."
Al sat there with his mouth open. He was entranced.
"So I decided that there had to be a way of getting the
message across. After much cogitating I decided to attack the
staff through the lunchroom. They are all real eaters.
"I went up to the dining room manager's office and talked
him into assisting me in my conspiracy. He was just making
up the day's menu, and we looked at it together.
"At lunchtime the special was a plate of corned beef and
cabbage. One person got a tiny sliver of sliced corned
beef and a huge mess of cabbage. Another got it the other
way around.
"Those who ordered a sandwich got it with toast on one
side and bread on the other. We fixed up seven or eight of
MANAGEMENT UNDERSTANDING AND ATTITUDE 41

these little tricks. I waited until there was considerable mur-


muring and my confederate had begun to look a little pale
around the gills. Then I went into the room and raised my
hand for silence,
"You have just had lunch on the basis that the require-
ments mean nothing. Each plate has been prepared according
to how the cook felt at that particular moment, with no con-
sideration as to what the menu, or even you the customer,
specified.
"I arranged all of this and will take all the blame. But I
just wanted each of you to see on a personal basis how dumb
it is to not insist that the requirements be met every time.

"All of them agreed to rethink the matter except the comp-


troller."
"The comptroller wasn't convinced?"
"Oh, she was convinced, but she was the one who got three
scoops of ice cream instead of the one scoop she had ordered.
She liked the svstem."
"Well, Bill, isn't it kind of chaotic to get so honest all at
once? Don't you really have to shut down the whole place
and start over?"
"No. You just work your way out of the problems, making
changes as you find they are needed. It is hectic for a while,
but it all works out You have to put a team together on
some problems.
"One of the most problems was in order writ-
interesting
ing. We found that they had been very casual for a long time
since they knew the shop wouldn't pay much attention to
them anyway. Now, all of a sudden we were doing everything
exactlv like it was written, and they had to get with it. The
order-writins people take a great deal of pride in their work
these days. We have learned that a correctly written order
produces a better chance of conformance from the shop."
After the meeting Harold rode back to the company with
Austin to fulfill his promise. Harold had hoped that the ex-
perience of the evening would change Austin's mind, and per-
haps bring forth a little more interest in defect prevention.
But Austin hadn't said much of anything since leaving the
meeting.
As they started through the first few pieces of rejected
material, Austin put his hand on Harold's wrist.
"I think Fin beginning to get the message. You know, we
have been rejecting the break angle on this same part for the
last two or three years. Engineering always says it's OKto
42 THE UNDERSTANDING
use it, but they never change the drawing. And look at this
subassembly! It always produces too much backlash when the
gears are mounted. Always."
He looked at Harold.
"You know, I think it is time that we got honest with our-
selves. Let's just leave this pile here. We'll tell engineering
and production control that we're not producing one more
part until they tell us the exact date the proper changes are
going to be made.
"You and I have got better things to do than sitting around
doing other people's work. Let's go home."
Harold nodded.
"Perhaps we should start with the lunchroom?"

UNDERSTANDING RESPONSIBILITY
Using the Grid
As a of the experience described above, Austin
result
Welding stepped from Uncertainty to Awakening according —
to the Quality Management Maturity Grid. He had become
aware that there was a better way, that it might be open to
him, and that he could do something about it. He didn't un-
derstand everything that was going on, but he did know that
there was a change in his managerial life-style.
His attitude had changed. And attitude is what manage-
ment understanding is all about
People are fond of saying that they were poor when they
were children, but they didn't know they were poor. Those
were the happiest days of their lives, they report. Everyone
they knew was in the same situation, and somehow or other it
all seemed to work out.
However, I have noticed that absolutely none of them con-
sider taking the simple step necessary to return to those great
days. Having sampled a life with more choices available to
them, they do not again select a life of zero options. They
want something over which they have more control.
That is sort of what the Quality Management Maturity
Grid is all about. I am sure you would like to know what is
available to you, what benefits you can achieve in return for
what labors, and how you can make your own choices. But
instead of taking the time to live it all out, to learn only
through often bitter experience, use the Grid. It lets you peer
into the future, with the reminder that you can fall backward
MANAGEMENT UNDERSTANDING AND ATTITUDE 43

as well as move forward. Those comforts obtained through


hard work and virtue ean be lost with one roll of the cubes.
Won doesn't mean kept.
Improvement itself is never the real difficulty. Once indi-
viduals recognize and agree on their position, it is never diffi-

cult to improve. The unfortunate part is that very few of us


own up. We don't admit how much time it really takes to
commute; we always break 90 on the golf course; tend towe
shade references to our age. We are a fragile and vain group,
we humans.
I have had discussions with executives in hundreds of dif-
ferent businesses and industries. Regardless of the nation,
product, service, or group I am never disappointed. Someone
always says: "You have to recognize that our business is dif-
ferent." Because they usually see only their business, they
never realize how alike most businesses are. Certainly the
technology and the methods of distribution can be very differ-
ent. But the people involved —
their motivations and reac-
tions — are the same. What works in one industry to improve
quality will work in others —
if you take the time to under-

stand quality and its content.


Faced with a group of management or professional people
who are waiting to hear some miraculous disclosure of a no-
fault method of quality improvement, I tell them I need in-
formation. I ask them to state their biggest single specific
problem. They are just to state the problem in one or two
sentences. No discussion, no analysis. And they are not al-
lowed to say that problem is "people," "commu-
their biggest
nication," "peace on earth," or other nonspecific items. I ask
them: "If the good fairies came down to earth and told you
that you could get rid of one problem, what would that be?"
The lists are always alike:

• They never give us accurate data.


• People just don't do good work.
» Our competition can buy cheaper than we can.
• They don't meet the commitments they establish them-
selves.
• These government regulations make you hire unqualified
people.
• Top management just won't understand that we have to
change our ways.
• The turnover rate is so high you can't train people.
44 THE UNDERSTANDING
• Interest rates are eating us up.
• The union is completely unreasonable.

The list could go you have your own items.


on. I'm sure
After writing these items on the board, I tell the group that
apparently we have invited the wrong people to the meeting.
This group has nothing to improve. Everything that is hap-
pening to them is caused by others. If I could bring the other
4 billion people in the world into the conference room, there
would be a chance of getting the list of problems solved. Oth-
erwise there is no hope.
I have done this exercise several hundred times. Not one
person has ever put forth a "biggest problem" that he or she
caused. No one ever says:

• I can't buy as cheap as the purchasing guy at the compe-


tition.
• I have been unable to convince the boss; I need to learn
more about how to do that.
• I am not reaching my people; their turnover rate is too
high.
• My planning has not been adequate on this matter.

By making a big deal about everyone to ad-


it, I finally get
mit that they would do well to look at themselves when they
are looking for the cause of problems. They always agree.
But it just takes too long for them to put the knowledge to
use.
When it comes to the responsibility for managing a com-
pany or a function, you have to be prepared to admit that
some of the problems might be caused by the individuals re-
sponsible for that management. Otherwise corrective action
will never happen. That is why the Grid comments on man-
agement understanding and attitude are important

Uncertainty

Uncertainty has no comprehension of quality as a manage-


ment tool. People in the Uncertainty stage tend to blame the
quality department for quality problems. This is because of
lack of information on the subject, and the erroneous as-
sumptions discussed in Chapter 2. It is important to recognize
the real meanings of words and functions. The baseball
umpire who said that what the pitcher throws is "nothing un-
til I call it something" was correct.
MANAGEMENT UNDERSTANDING AND ATTITUDE 45

Uncertainty lives in the present. Each day dawns on a new


world, and each night ends that world. Problem prevention is
not a real part of Uncertainty's operation, since to prevent,
you must look into the future. Therefore it is easy to identify
the quality function in an Uncertainty situation. It consists of
inspectors and testers, who probably report to the manufac-
turing department, and who sort the product as it moves
along. Management expects them not to let anything that is
"too" bad get out of the place.
Uncertainty's idea is do whatever you have to do to find
and solve today's problem, letting tomorrow take care of it-
self. Since no reasonable person will ever admit that he or
she would think such a thing, you have to look at what a par-
ticular operation does if you are going to establish its rating.
If the problem is something that can be fixed with a waiver
or a paperwork change, then Uncertainty is in business. That
is much preferred to the time it would take to identify the

cause of the problem. Furthermore, if the real cause of a


problem were found, an operation could get involved in
redesign, tool rework, training, and all kinds of time-con-
suming things. That is not attractive. And anyone suggesting
that such actions could eliminate problems in the future is
taking his life in his hands. There is no future. There is only
today.

Awakening
The between Uncertainty and Awakening is
difference
somewhat Eisenhower used to say was the dif-
like President
ference between a true conservative and a liberal conserva-
tive. The conservative didn't want to do it. The liberal
conservative definitely wanted to do it, but not at this time.
I often hear executives say that they want to begin the
quality improvement program, but they want to wait until
some problems are cleared up first. They don't want to start
the problem-resolving program until they have resolved some
problems. How does that grab you? It is the Catch-22 of the
unenlightened.
What Awakening is really afraid of is commitment to the
future. Uncertainty doesn't know about the future and so
can't be bothered by it. Awakening knows about it, and is
bothered. Both do nothing, but for different reasons. The
result is the same. Awakening people are more willing to talk
about long-range corrective action, and even willing to let it
46 THE UNDERSTANDING
happen now and then. However, they are not ready to spend
the money on the quality program yet. They don't relate
money spent to money saved. Money spent is real money;
savings in the future are not. It is not enough to explain that
quality is really a self-funding program. Awakening moves
only when the true cost of quality is understood.
In fairness to the line managers, I have to say that the
quality professionals who work for Awakening are usually
not too much help to those of us trying to push improvement
One plant I visited showed me an interesting paradox. The
young general manager was enthusiastic about quality and
recognized that she needed to take action. She called the
quality manager out of the shop and got me started on a
tour. The quality manager told me endless tales of noncon-
formance, and of horrible situations that needed to be
corrected immediately. He pointed out that management just
would not listen, that he had tried and tried, but to no avail.
In my exit interview with the general manager I carefully
told her about all the problems her quality manager had. She
immediately called the man to the office, apologized for not
listening, picked up her pencil, and asked for a complete list
of problems that needed attention.
My informant looked her right in the eye and said, "Noth-
.•
ing I can't handle, chief
I have never forgotten that lesson. Since then I have never
attempted to recondition management until the quality pro-
have it clear. Their ideas and assumptions are often
fessionals
more deeply ingrained and more definite than those of top
management. As I said, it takes a little time.

Enlightenment
I hate to keep talking about attitudes, but attitudes are re-
ally what it is all about. The difference between the best and
the worst platoon in the army is not equipment or location.
It is attitude. The mysteries of creating both the negatives and
positives of this still elude me, as they have others. But once
in a while it all comes together, and that is beautiful to see.
Some of occurs during Enlightenment.
it

The thing you notice when a management moves into


first

Enlightenment is the relaxation of tension. Suddenly commu-


nication begins and defensiveness reduces. This comes about
primarily because they have admitted to themselves out —
MANAGEMENT UNDERSTANDING AND ATTITUDE 47


loud and by action that they need to improve. It is sort of
an industrial "born again" phenomenon.
By formally establishing a quality improvement team
representing every department, Enlightenment has clearly
stated that everyone is involved. No operation is being singled
out, no one is being fingered. "We are all in this together.*'
What magic words. With no need to plot and scheme in order
to protect their department, all work together. Naturally the
progress is swift and immediate.
One nice thing about the fourteen-step program of quality
improvement (described in detail in Chapter 8) is that it
brings immediate improvement because problems get immedi-
ate attention. This generates enthusiasm on the part of the
quality team that is transmitted to others. Of course the com-
pany personnel immediately send out their sensors to deter-
mine if this is really a sincere endeavor or just some quick
"motivation" thing.
Part of Enlightenment is the recognition that you cannot,
and should not, fool the people. That sounds about as basic
as you can get, but not too many believe it. Many have a
stereotyped image of the "worker," and think workers are
completely predictable. But workers are individuals, and they
know when they are being put on.
Top management must go out of its way to provide sup-
port for the quality management at this time. The profes-
sional quality team is working hard to educate the rest of
operating management at all levels. This is not an easy
process. Just because the general manager and the depart-
ment heads have gotten religion doesn't mean that anyone
else has. There is always a clutch of Uncertainty- or Awaken-
ing-type behavior right in the middle of the operation. People
still in those stages will probe continually to measure the

depth of top management commitment. They are not on any


team, they don't get to plan the campaign, they don't receive
rewards. At least that's what they think. When they reach
their personal Enlightenment, that will change.

Wisdom
Wisdom, having reaped the fruits of Enlightenment's labor,
concentrates on not losing it. People in the Wisdom stage ac-
tively participate in the entire program. They serve as per-
sonal examples, and take the time to learn more about the
subtleties of the philosophy of quality management. And a
48 THE UNDERSTANDING
subtle thing Wisdom must indeed be wise to recognize
it is.

that the time takes for true, long-lasting, never-to-be-over-


it

come improvement to set in is years. And even then you can


never be sure. You have to work constantly, ever creating
new interests, ever looking for new ways to prevent noncon-
formance.
Many companies in this stage use the Buck a Day* pro-
gram to seek out ideas for improvement. BAD is a five-week
program that lets you go to the people in an entertaining
fashion and ask them to provide ideas for their jobs that will
save $1 a day by eliminating some unnecessary expense. That
is $250 a year per person. If a company employes 1000
people, it becomes $250,000 a year. The program always
succeeds, and the return is usually $100 for each $1 invested.
Savings are real, but the major advantage is the improvement
in communications and morale.
Those who consider quality improvements a motivation
program never reach the age of Wisdom. They are always
looking for gimmicks that will take the place of genuine par-
ticipation and involvement. Wisdom doesn't have this prob-
lem. Wisdom runs the program over and over in different
ways, never losing sight of the goal of defect prevention.
And that means complete defect prevention, so that the
writing of a rejection tag is never heard, and all the rework
stations are closed, locked, and forgotten.

Certainty

Certainty has reached the stage of complete defect preven-


tion. When a defect does occur, it is examined with the same
rapt attention given the ultrarare case of smallpox found now
and then by a big-city hospital. Certainty has learned some-
thing that couldn't even be explained to Enlightenment Cer-
tainty has learned that ifyou don't expect errors, and really
are astonished when they occur, then errors just do not hap-
pen.
You probably don't believe that now, but someday you
will. Examine the Grid, examine your goals, and prepare for
a long but rewarding trek on the way to Certainty. Why not?
Think where your company could be if you completely elimi-
nated failure costs.
*BAD is marketed by Industrial Motivation, Inc., 331 Madison
Avenue, New York, New York.
MANAGEMENT UNDERSTANDING AND ATTITUDE 49

CHANGING MANAGEMENT'S ATTITUDES


The most effective to bring operating and other man-
way
agement people to their senses is to put them in contact with
someone they will believe. Obviously, they are not going to
accept the unsupported word of the staff professional. It is
like believing theautomobile salesperson is unbiased.
No potentate who ever existed was subject to more persua-
sion than the individual who is president of a company, gen-
eral manager of a plant, or otherwise the head person in an
industrial or business organization. Their life is a constant
stream of people explaining how if only the chief would im-
plement such and such a plan everything would be hunky-
dory.
One general manager told me that he has calculated that
every year he is offered the opportunity to save $30 mil-
lion— in a company which only has $25 million in sales!
Each day brings input from dedicated, thoughtful, sincere
people who want you to do things their way. It is a dreadful
obstacle to overcome.
Believing that quality is free, we are going to work to over-
come this obstacle by taking a clear look at reality by ex- —
amining the facts. But facts presented by peers, not by those
devious souls on the staff. In the Jungle Habitat operations,
you drive through a zoo in your car while the animals roam
around free. There are two signs as you enter, one stating the
price of admission and the second making it clear that you
must not open your windows or leave the car because the an-
imals are not the least bit tame. However, it is possible to
imagine a third sign, placed by people like those who run
plants or offices for large corporations, reading "Headquarters
staff personnel on bicycles admitted free." This sort of all-
too-common attitude means that people who are trying to
change things must work with people who trust one another,
if only because they feel they have a common enemy.
In every operation there is one area that is more open to
new ideas than the others. This operation should be encour-
aged to conduct a pilot program for your project. With a
minimum of personal visibility you can assist them in plan-
ning and implementing the program. Once there has been
sufficient accomplishment, congratulate those involved and
ask them to share it with the world. Schedule a management
seminar, and invite all the general managers and other senior
50 THE UNDERSTANDING
executives of the companies who haven't yet participated. Do
the seminar properly. Plan it right down to the last gnat's
eyelash, and get top management's participation. But keep the
quality professionals out of it.
The idea is that the audience should consist of those who
actually have to do the work, and they should be hearing
from those who face the same problems and pressures. It is
truly a revival meeting, with witnesses telling how they were
wrong once, but now they know the way and are accomplish-
ing actual improvement.
The senior quality professional should conduct the ceremo-
nies in order to keep the meeting moving. But the emphasis
has to be on worker bees. Let an engineering manager tell
about the results of establishing effective product qualification
procedures. Have a marketing type tell how having less prob-
lems produces more sales. Let the consumer affairs people
relate their experience in handling reduced complaints and
even compliments.
At the end ask for commitments. Make the audience do
something like stand up, or raise their hand, or sign a master
commitment chart. Send them back to be greeted by their
quality department, all prepared to implement this commit-
ment. Before you know it, they will.
Recognize all achievements, and assist senior management
in doing some recognizing of their own. But always remem-
ber that this is just a start. You will have to do it over and
over again. Conduct the same type of success-witnessing sem-
inar for quality people in the quality councils. They need en-
couragement and information more than their leaders. As
long as their attitudes are positive, they will keep manage-
ment on the right track.

A COMMENT ON
MANAGEMENT ATTITUDES
I visited my
old pal Dinsmore recently. He had called to
let me know he had taken over as general manager of
that
the Flagship hotel about six months ago and thought that I
might be interested in seeing a real hotel from the inside. He
also indicated that I might learn something about the hotel
business.
When drove up to the front door, a steady rain kept me
I
inside the car for ten to fifteen minutes. During that time I
noticed that the doorman was peering at me from inside the
MANAGEMENT UNDERSTANDING AND ATTITUDE 51

lobby. Sensing that the rain was not going to quit, I made a
dash for the doors and pushed my way in, dripping on the
carpet in the process. The doorman told me I could only
leave the car there for about ten minutes since it was a no-
parking zone, but that the hotel garage in the next block
would be glad to store it for me. He offered to lend me his
umbrella in order to unload the trunk.
Accepting his offer, I retrieved my suitcase and clothes and
bag in order to drag both to the front desk. Announcing my-
self as Mr. Dinsmore's guest didn't seem to make much of an
impression on the clerk, who was chatting with the cashier.
She seemed a little irritated at my interference.
There was no reservation for me, but they said they could
fix me up since I had said the general manager had invited
me. After only three rings of the "front" bell, the bellhop
came to lead me to my room, which it turned out wasn't
made up. He commented that it was only 3 o'clock, and the
room would probably be fixed by the time I returned from
my business. I tipped him, dropped my bags, and remem-
bered the car.
It wasn't necessary to worry because the police had just
towed the vehicle away. The doorman said that he had waved
to the tow truck but they hadn't been able to see him for the
rain. He assured me that I could pick up the car in the morn-
ing with no problem. A
cab could take me to the police lot,
and the fine was only $25 plus the towing charge. The garage
charged $6. He noted that it was interesting how they could
move a car like that without having the key. Said they would
make good thieves.
I found Dinsmore's office on the third floor. One of the
elevators wasn't working so I took the brisk walk up the
stairs.His secretary nodded and suggested that I move some
magazines off that bench and sit down as "Elmer" would be
with me as soon as he got off the telephone. She went back to
her book.
After a few minutes she seemed to notice my presence
again, and offered me some coffee from the percolator in the
corner of the reception room. (She didn't like the hotel
coffee, and neither, apparently, did Elmer.) I accepted with
thanks, telling her I was still damp, having not been able to
shower and change because the room was not prepared. She
said I really shouldn't expect much else since, although
checkout time was noon, they didn't like to push their guests
52 THE UNDERSTANDING
out on rainy days like this. I said I thought that was very
considerate of them.
I asked about my automobile, and she repeated the in-
formation I already had about the $25 fine and towing
charges. Happens all the time, she indicated. The police have
no class.
Dinsmore emerged from his office and greeted me effu-
sively. Now, he told me, I was going to see how a hotel
should be run. He took me into his office, cleared some re-
ports off a chair, and offered me a cigar. After remarking on
my trip, and how fortunate it was of him to catch me in an
off moment, he asked how I liked the place so far.
I told him about the car, the doorman, the room clerk, the
room, the bellhop, and the elevator. He told me how to get
the car back and dismissed the other incidents as growing
pains.
Then lowering his voice he asked me if I would mind
checking out the restaurant for him. He would pay, naturally.
Bui he wasn't sure the restaurant manager was really oper-
if
ating the place right. She didn't seem to get along with the
other department heads and barely spoke to Elmer. Some-
thing funny is going on, he thought Also, the hotel occu-
pancy rate had been dropping rather steadily. He was sure
that this had something to do with the food.
Then straightening his tie, rolling down his sleeves, and
putting on his favorite old hunting jacket, he took me on a
tour of the hotel. He emphasized that I had only seen the
front side of hotels in my travels. He was going to show me
the real guts.
In the maid's room nine or ten women were involved in a
discussion with the housekeeper about their assignments.
Those on the lower floors had to wait until the vacuum
cleaners were available from the upper floors, so naturally ev-
eryone wanted to work on the upper floors. Dinsmore sug-
gested that they vacuum every other day; then they could
share the machines on a rotating basis. The maids thought
that was a great idea, although the housekeeper didn't seem
too pleased.
Dinsmore remarked to me about the lack of some people's
decision-making ability. He sighed that he had to make more
and more decisions each day because his staff seemed reluc-
tant to take the initiative.
We met the bell captain and three of the bellhops in their
locker room discussing, with the doorman, the procedure for
MANAGEMENT UNDERSTANDING AND ATTITUDE 53

getting guests' bags from the front door to the desk. The
problem was in splitting the tips, which were getting a little
lower every day. Elmer listened judiciously and then suggest-
ed that all tips be given to the bell captain, who would dis-
tribute them on the basis of effort as he sawThis didn't
it.

seem to make anybody very happy, except the captain, but


since the four couldn't agree on anything else, it was adopted
on the spot.
We toured the floors, I mentioned the amount of room
all
service trays that seemed to be standing in the hall. Dinsmore
said that this was a normal part of the hotel scene. The guests
didn't mind because it reminded them that room service was
available.
The cigar and newspaper stand looked like it belonged in
the subway. The old man behind the counter offered me some
stale alternatives to the cigars I had requested. He was very
pleasant about it. The only magazines I saw featured cover
pictures of attractive girls in various stages of disrobing.
"Guests don't go in for high-class books anymore," Dinsmore
toldme. With a nudge he reminded me that I didn't under-
stand the hotel business.
The restaurant seemed to belong to a different world. It
was packed. The m&itre d* rushed over, bowed, seated us at a
window, and took our drink orders. An atmosphere of quiet
efficiency seemed to blanket the room. Two drinks appeared
before us while attractive menus were deftly placed to our
left. didn't seem happy. The restaurant, he told me,
Elmer
was a concession left over from the previous owners. He was
trying to buy out the leases so he could run it into a real
moneymaker. At present it made only about 10 percent net. I
mentioned that most hotels lose money on their restaurants.
He countered by showing me how many people were there
even on that rainy day, and insisting that raising the prices
while cutting back on the help was bound to increase the
take.
My appetite disappeared momentarily, but was reawakened
at the sight of a beautifully poached trout heading for an-
other table.
The next morning I retrieved my car, placed it firmly in
the hotel garage, and returned for a farewell meeting with
Dinsmore. He asked my opinion concerning his stewardship.
He commented on the failing standards of today's workers,
noted that he had ever-increasing difficulty in getting people
54 THE UNDERSTANDING
who wanted to do quality work, and bemoaned the fact that
the big grand hotels like his were losing out to the motels.
I just couldn't bear to tell Dinsmore the truth. He wouldn't
have believed me anyway.
Last week he called again. The hotel had been sold and
was to be torn down to serve as a site for an office building.
It was just too old and poorly located to make any money, he
felt. He was going to accept an offer from a motel chain to
run their East Coast operations. He would be responsible for
thirty-four inns, and he wanted me to be his guest at one of
them soon.
I can hardly wait.
Quality Organizational
Status

Suppose you were responsible for supplying towels at your


club. Suppose you found that some of the members were
using three and four towels each time they showered. Sup-
pose you decided that this had to stop. How would you
proceed?
Would you speak separately to the members, telling them
not to be so wasteful? That would take forever, you would
never find anyone who would admit to wastefulness, and you
absolutely would not pick up any new friends. In fact, you
would probably alienate many old ones. You would probably
become known as that "towel watcher," and there would be
an intense amount of mental effort expended creating original
jokes at your expense. There would be speculation as to
where you had learned your trade. life would take a definite
turn for the worse.
You wouldn't attempt to correct the problem on a personal
basis. You would probably hang up a sign requesting that the
members not be wasteful, since continued waste would make
a towel-use fee necessary, and sign it "The Bath Committee."
The bath committee. What a delightful way to get atten-
tion without being personally involved. People can make up
jokes about the bath committee, but who cares? Since the
membership of that group changes continually, no one ever
has to face the charges personally.
From such reasoning comes most of the direction you re-
ceive in your daily life. No names of people, just names of
55
56 THE UNDERSTANDING
institutions: greens committee; Internal Revenue Service;
United Airlines; the finance committee (if you don't pay your
dues); the board of directors; and of course the greatest
vagueness of all the company. You have your own list of
appropriate names, and you have probably used the commit-
tee approach in your managerial role.
When it comes to organizing a functional discipline in a
company, particularly one with several divisions or different
operations, it is necessary to issue directions and orders. It is
essential that each function be established in some orderly
way that can be measured and controlled. For that purpose
most companies have developed a book of policies and stan-
dard practices.
Notice that I said "companies have developed"; and notice
that you accepted it Now you know as well as I do that
companies are inanimate objects, with no ability to develop
anything. We both know that some individual in an organiza-
tionhad to develop this to "the com-
approach. Attributing it

pany" is a form of social communication that lets orders be


given without personal involvement
Quality is something that is rarely defined and directed in
formal policies for companies. Somehow it is felt that such a
thing doesn't really require documentation and establishment.
But it does, perhaps even more than other functions, because
otherwise people will feel that they can make up their own
rules. A lot of problems will be avoided if you lay out a clear
policy covering the entire quality operation.
The policy I recommend runs along the lines of the follow-
ing example. You might want to add a little to it, but please
resist the temptation to turn it into gospeL Keep it simple,
and you will have the reasonable expectation of having some-
one read it. But make certain that it is complete. After all,
policies are used to settle arguments.

POLICY
Quality Management Function
It is the policy of our company that the function of
quality management each manufacturing
shall exist in
and service operation to the degree necessary to ensure
that:

1. The acceptance and performance standards of our


products and services are met.
QUALITY ORGANIZATIONAL STATUS 57

2. The cost of quality goals for each operation are


achieved*

The company general manager is responsible for


obtaining agreement with the corporate director of qual-
ity on the proper degree of quality function to be es-
tablished in each operation. The general manager shall
issue a quality policy for the operation, quoting this
document, and shall take affirmative steps to ensure that
the employees understand that the quality policy of the
company is to perform exactly like the requirement or
cause the requirement to be officially changed to what
we and our customer really need.
To ensure its effectiveness, the quality function
must be exercised in an objective and unbiased manner.
As such, the head of the quality function in each unit
shall report directly to the general manager and be on
the same organizational level as those functions whose
performance is being measured. The head of the quality
function shall represent the company in the quality
councils.
Thequality function shall be staffed with profes-
sionally qualified personnel, and their responsibilities
shall include:

• Product acceptance at all levels

• Supplier quality
• Quality engineering
Data analysis and status reporting
Corrective action
Planning
Qualification approval of products, processes, and pro-
cedures
Audit
Quality education
• Quality improvement
• Consumer affairs
• Product safety

The company shall produce cost of quality reports


in accordance with the comptroller's procedure and will
create regular quality status reports for presentation to
all management personnel. Standard practices to support
58 THE UNDERSTANDING
the details of all activities mentioned in this policy have
been prepared.

SOME THOUGHTS ON QUALITY


A lot of people seem to think that God was the first qual-
ity professional,and that those who have followed Him in the
business of judging what is good and what is not good do so
by divine right They know that there are two kinds of
people, the good and the bad, and that the good get to decide
which is which. The purpose of having an independent objec-
tive quality department is to get away from this kind of

thinking to limit such choices to those who have nothing to
gain from the decision.
Quality organization is not very complicated, but establish-
ing a good quality operation can be. If something is easy to
understand and makes sense, and yet isn't always done, there
has to be a reason for not doing it. There are two possibili-
ties: (1) Management doesn't trust anyone else to make the
decisions about quality. (2) Management doesn't understand
the value of a good quality operation.
I prefer to think that the second is the usual one. Certainly
companies who have given the subject some thought get
along well with their quality departments.
Speaking about giving the quality business some thought, I
feel it is time to discard a lot of the useless appendages that
have made quality management difficult to understand. The
word "quality" is good enough to stand by itself. We should
eliminate "control," "assurance," and other modifiers that too
often accompany it. These identify relatively insignificant and
minute differences in approach.
The term "quality assurance" came into being during the
first frantic missile years so a few astute individuals could
move into higher salary brackets and at the same time be in-
volved in more dignified work. They were soon peering over
shoulders, rather than making quality happen. Certainly I
have no objection to a little nest feathering, but it is possible
to make an excellent living actually doing the job of quality
rather than just auditing to find out why it wasn't done.
There is absolutely no reason for having errors or defects
in any product or service. The concepts of quality manage-
ment listed throughout this book, plus some hard, dedicated
work, plus continuous exercise of personal integrity, make
preventing error a realistic possibility. That in turn makes it
QUALITY ORGANIZATIONAL STATUS 59

realistically possible for the error become one of


preventer to
the most valuable executives in any company. You can get
rich by preventing defects. You can never make much by
simply "assuring" or "controlling. Police officers try to keep
things under control. Lawyers often work at prevention. You
have never seen a rich policeman. There are a lot of rich
lawyers.
Think about it

ORGANIZATION
Quality operations should always report at the same level
as those departments they are charged with evaluating. Thus
they cannot be bossed by engineering, marketing, manufac-
and so forth. But more than that, the
turing, administration,
quality manager must have access, on an ordinary basis, to
the thought leaders of the company. The quality manager
must be the type of person who can fit into their business
circles comfortably. The most valuable actions the quality
manager can take for the company involve preventing prob-
lems by heading them off and by advising restraint or redirec-
tion at the proper time. It is not possible to put this sort of
thing on an organization chart, and in fact it is not really
possible to direct it. That is why there is a chapter on man-
agement style at the end of Part One. Every successful qual-
ity program I ever saw was headed by an individual who
knew how to communicate with, and even discipline, man-
agement groups without antagonizing them. Successful qual-
ity managers know that the way to make people quality
conscious is to make them comfortable with the concepts of
quality, and show them how to recognize what they can re-
ceive from loyalty to the concept. That art must be practiced
in most functions. But quality is unique in that all the
successes as well as failures are caused by people in other op-
erations. The product or service is quality because of other
people's fingers and minds, and the quality managers must be
able to work with those people in order to handle the func-
tion properly.
The difficult jobs of management are generally considered
those having to do with profit and loss of money, and respon-
sibility for same. Headhunters look for operating people who
"turn companies around," and who maximize profits. And of
course there are people who do these things. There are also
people who do the opposite.
60 THE UNDERSTANDING
What the headhunters and business writers don't recognize
is that the functional jobs are what really make that sort of
thing happen or not happen. Functional management is much
more difficult than operations. Operations is a matter of or-
dering functional people around. In twenty-five years of func-
tional management, I can count the useful directions I have
received from operation types on one finger. How's that for a
positive, endearing attitude?

QUALITY DEPARTMENT FUNCTIONS


Product Acceptance

Inspection. The base of every quality program is data collect-


ed through visual and mechanical inspection which permits
evaluation of product or service status. Data can be the result
of housekeeping evaluation in hotel rooms, a check of solder-
ing, inspection of machined parts, or any of a thousand ex-
aminations. Each measurement has three things in common.
First, they are planned evaluations conducted in a planned
manner for a planned reason; second, they are conducted by
professionally trained inspection personnel; and third, the in-
spection personnel are organizationally separate from those
operations they are inspecting. Uncertainty and Awakening
will give you the story that the inspectors should report to
manufacturing so they "will have the tools to do the Job."
Actually this only gives them the tools to control the accept-
ance of the product, whether it is any good or not Inspectors
who report to line supervisors receive no professional train-
ing. They serve as sorters, go-fers, and general flunkeys. As a
result, most inspection operations set up a separate quality
control group to audit results. This group always finds 10 per-
cent defectives that the inspector missed because he or she
was not properly trained, informed, and led. An inspector is
not a true inspector unless the inspection is independent and
last

Testing. Part of the acceptance function is accomplished with


electronic or mechanical test equipment used to determine the
functional integrity of the product, from components testing
in receiving to systems testing at the end of the line. This
function measures the performance of the product at all lev-
els. In addition to testers who do actual testing, this function
employs test engineers who assist in developing test equip-
QUALITY ORGANIZATIONAL STATUS 61

ment concepts and establishing testing procedures. The only


purpose of testing is to determine whether or not the product
will perform to the basic product specification.
Since testing includes many more variables than inspection,
it issubject to more pressure. For instance if the test supervi-
sor tells the project manager that a system has passed testing
the manager will say, "Great. Ship it." However, should the
report be negative, he will say, "Test it again, Sam." When-
ever a product passes, it is acceptable. For that reason the
test engineers must write test programs that require exact test
results.
The biggest current problem with testing, particularly in
electronics, software.
is The computerizedtest equipment
naturally requires computer programs that direct, and for the
most part conduct, the test. There is no reason why these pro-
grams themselves should not be considered products and
should not be required to meet the qualification test re-
quirements. Testing equipment and software now represent a
major financial investment, sometimes larger than the de-
velopment cost of the product itself. It is wise to make certain
that this important function is well controlled.
Testing acceptance testing anyway, should never be
itself,
performed by engineers. One time I was responsible for a
weapons-system test which included testing the missile, the
ground equipment, and the combined hardware. The only
thing all three had in common was being behind schedule
constantly. Finally we took all the engineers out of the area,
installed hourly paid testers, and instructed them to follow
the test procedure exactly until they got a red light. Then
they would call the test engineers to the floor to determine if
the fault was in the product, the test equipment, or the pro-
cedure. Slowly we worked our way through the entire system
and got the acceptance equipment and procedures verified to
the point where they would accept a good product while re-
jecting nonconformances. From then on the testing was a
breeze, and I learned once again that technical people will
never finish their testing if you don't exercise some control.

Supplier Quality

Just about every company purchases products, supplies, or


services in an amount that is equal to around 50 percent of
their sales. These materials or services entering the company
on a continual basis make necessary a dedication to defect
62 THE UNDERSTANDING
prevention and product acceptance that is usually underesti-
mated. Remarkably little is accomplished, except in compa-
nies under government or regulatory contract.
The lowest-level purchasing agent can commit a company
to expensive contracts without murmur. However, if people
want to spend money on brick and mortar, they must go
through the administrative wringer. The money is the same.
It is just the concept that is different.
In discussing the supplier quality operation I will concen-
trate mostly on product or material control. But it would be
wise to remember that the largest single supplier to your
company, the vendor to whom you pay the most money, is
probably an insurance company. When we talk of procedural
control, it is necessary to think of contracts that go on for a
long time and produce things that don't get inspected in the
receiving operation.

Supplier quality engineering. I have always considered pur-


chasing to be too narrow a function. Traditionally purchas-
ing's job has been to take an order constructed by some other
department and place it. The operation has not usually been
involved in whether the item specified offers the best purchas-
ing opportunity. After-the-fact dilemmas like this face quality
operations in the usual purchasing situation. The shortest
time lag in the operation is usually spent searching for the
best supplier in terms of quality, cost, and delivery. Most of
the time is spent in product development or conceptual
design. Purchasing has little opportunity to do a selection job,
and quality doesn't really know how to help them. A tour of
potential suppliers, conducting "quality audits," is next to
useless. Unless the vendor is a complete and obvious disaster
area, it is impossible to know whether their quality system
will provide the proper control or not. You can only know by
being on the inside of the vendor's company. The Quality
Management Maturity Grid can be completed only by those
who know the company from having lived there for a while.
The same type of situation exists with suppliers.
Just as purchasing needs time to identify, examine, and de-
velop suppliers, so quality needs time to participate in this
process with them. I have tromped through hundreds of
plants on supplier audits, peering intently at calibration stick-
ers, asking questions about control of nonconforming
material and doing all the conventional things. All the time I
knew that the real answer was behind the eyes of the general
QUALITY ORGANIZATIONAL STATUS 63

manager and that I would never decipher that from what


could be seen in a brief visit general manager would
The
swear to anything, or undergo any rite, to obtain my blessing.
But once blessed, would the manager be true? Or even be
there long? Who could know?
The only answer for the supplier quality people to assist
is

their purchasing friends in getting involved earlier in evalu-


ating the key items that will be bought. Since quality is closer
than purchasing to the manufacturing and technical oper-
ations, quality people can act as a catalyst to start this
process. I wish someone in purchasing would write a purchas-
ing management maturity grid.

Purchased goods acceptance. Acceptance inspection and test-


ing of purchased items can take place anywhere. They do
not always have to be done in a receiving room next to the
truck dock. With proper planning, acceptance can take place
in a supplier's plant, even during an in-process operation. It
can happen in your own plant at final assembly. It can be ac-
complished anywhere in between. All this is a matter of plan-
ning and execution. Uncertainty does little but the most
obvious receiving inspection; Awakening doesn't do much
else; Enlightenment sets up sampling inspections and gives
serious consideration to more quality engineering effort in this
area; Wisdom is into planned acceptance work, but still be-
lieves in the dream of supplier selection by quality audit
Obviously acceptance operations are conducted by the
all
same organization that conducts the rest of the quality de-
partment acceptance functions. Each inspection or test must
be planned with the same technical integrity as the ones on
the assembly line. The most important consideration is to
make certain that the acceptance is conducted by the terms
of the purchase order, not by the terms of some leftover plan.
This is important because you will find that half of the rejec-
tions that occur are the fault of the purchaser —
you. Either
the item was not described properly in the purchase order, or
the wrong requirements were put in, or the test equipment
wasn't coordinated properly.

Qualify Engineering
Back when I started in the quality business it was easy to
identify the quality engineers. They were the ones with the
shirts and ties. Now it is the otherway around. But I can
64 THE UNDERSTANDING
remember being required to wear a white shirt and tie for the
first time in the plant I slunk around avoiding my former
colleagues for a week until I got over being self-conscious.
I'm not really certain what this has to do with our discussion
of quality engineering, but it did occur to me as one obvious
way that it is different from product acceptance.
Broadly, quality engineering is supposed to be responsible
for determining and planning the work of the rest of the de-
partment They should see the overall quality responsibility
for the company in terms of doing this here, and that there,
to make the whole achieve its proposed results. That means
they must decide who inspects and tests what, who collects
data where, and what information should be supplied to the
system to keep it moving.
Quality engineers should collaborate with design engineer-
ing concerning a new product's performance characteristics
and meet with manufacturing engineers concerning the way
the product will be manufactured. In that way quality en-
gineers can determine how the product should be inspected,
tested, and controlled during its life both in and outside of
the company. Detailing these requirements, training people to
accomplish them, and measuring results are what quality en-
gineering is all about

Data and status reporting. Each inspection or test


analysis
brings about two results. First, the product is either accepted
or rejected; and second, the measurement itself must be
recorded. By accumulating these measurement results and an-
alyzing them, the quality engineer can determine exact and
continuing status. The quality engineer assembles the data
and then reports it in a form that will be of practical use to
everyone involved.
Highly visible charts should be hung in the work areas. If
you take the time to explain the charts to the individuals in-
volved, they will relate to them and appreciate their being
displayed. People really like to be measured when the
measurement is fair and open.
Progress charts and reports allow working-level manage-
ment to know if their process is being controlled. They
provide information on which workers are having problems
and which are doing well. Senior management needs accurate
trend data to learn when action must be taken. If the quality
engineering function doesn't provide such data, it will be out
QUALITY ORGANIZATIONAL STATUS 65

of business. Senior management will let quality work on the


future only if it is helping them survive the present.

Corrective action. It isn't what you find, it's what you do


about what you find. All the planning, inspection, testing,
measuring, and other activities occurring within the quality
department are a waste of time if they don't lead to prevent-
ing a recurrence of a problem. The real strength, and value,
of quality engineering involves learning from the past to
make a smoother future. (That would make a great political
slogan.) Unfortunately most people only learn from the past
for the purpose of repeating it
Suppose you have a heart attack, and survive it. The physi-
cian tells you that you can well have another one unless you
change the basic patterns that led to the first one. Specifically
you are requested to reduce your weight to what you weighed
when you left high school; quit smoking; alter your diet in
order to lower cholesterol and triglycerides; and take action
in your personal life to reduce stress. If you have learned
from your experience, you will take this preventive action. If
you have learned nothing, you will change nothing. Then you
will deserve what happens to you.
Today most medical problems, with the possible exception
of cancer, can be prevented or greatly alleviated. All that
is required are some personal discipline and professional
guidance.
Today most nonconformance problems, with the exception
of unknown phenomena, are preventable. All that is required
are some organizational discipline and professional guidance.
The best sources of information about situations requiring
corrective action are observation of actual rejections and
analysis of trends. Actual rejections are easiest because the
evidence is so obvious. You wind up with a defective part in
your hand and people to talk with. Trends are less obvious;
they require detective work that may involve lab analysis and
other kinds of sleuthing.
Detailed corrective-action experiences are described in Part
Two. But I should caution you that people will only tell you
the troubles that others cause for them. They will not reveal
what they make happen themselves. Also I believe that once
you put on a suit no one tells you the truth anymore.

Planning. Amodern quality department in a manufacturing


operation certainly pays its own way, but up front it is expen-
66 THE UNDERSTANDING
sive. For that reason it is only reasonable that planning
should be a key part of quality engineering. Everything that
happens in the quality system must be a result, not a reac-
tion. Many of us sit waiting for the telephone to ring or the
mail to arrive before acting. Even the biggest big shots some-
times are "closet reactors," who sit absolutely dead in the
water on mail holidays.
Most quality departments formally lay out their obvious
planning activities to support such product activities as ac-
ceptance, data analysis, product qualification, and others. Of-
ten they ignore quality improvement programs, even though
the total effect of such "off line" functions is much more sig-
nificant to the success of the department than any product ac-
tivity. Nothing can be left to chance. For example, one
activity that should be part of each company is new employee
quality orientation.
Each and every task must be listed and assigned some sort
of action line, even if it is to say that nothing is going to be
done about it Otherwise all the policies, standard practices,
and philosophy will come to nothing. Good things only hap-
pen when planned; bad things happen on their own.

Qualification of products, process, and procedures. Every new


thing must be tested and proven before it can be used. This
includes the procedure for translating sales personnel's orders
to a format that can be used in the shop; it includes the new
method of programming computer tapes; it includes the new
process for plating plastic with chrome; it includes new prod-
ucts; and it includes products whose design has been
changed. Very few problems occur in any organization that
are not the result of introducing a new and untried change
into the life of that operation. The proving and correcting al-
ways occur eventually, if for no other reason than to correct
problems that inevitably occur. But that is expensive and re-
strictive. It is better to make the change prove itself before
sending it out to fend for itself.
Products must be made to operate in the actual environ-
mental conditions they are designed to meet; processes should
be made to show, by test, conformance
that their result is in
to the requirements; and procedures should be proved to be
accurate, understandable, and effective. In all cases these
proofs should be demonstrated to the quality department
people. I think they should not actually perform the testing
because that would require their becoming too closely in-
QUALITY ORGANIZATIONAL STATUS 67

volved with the results. There is nothing like a little parent-


hood to cause bias.
Finally, rememberthat reality is the ultimate criterion. It is
one thing to watch a planning director institute a new hotel
reservation procedure. It is another to witness actual reserva-
tion makers carrying the procedure out

Audit. Few functions are spoken about more and understood


less than auditing. It is often the last refuge of those who
don't really know how to run a prevention-oriented life. Au-
dit is the Bat Masterson of business. When you get into trou-
ble, just call old Bat. He'll find all the bad guys and drag
them to justice. And even if he fails to find the real ringlead-
ers, you still look good. After all, you called in the law, didn't
you?
Accomplished properly, audit is a valuable tool. It is a
planned examination of a function, carried out either by de-
termining conformance to procedures in process or by critical
analysis of the product or service that is the result of the
process. That is about all there is to auditing. Meticulously
done there is no method more fruitful in exposing the
shoddy, inattentive, or misguided. The fraudulent are usually
too dedicated to be caught by anyone other than themselves
or just plain luck. Audits catch only the undedicated, bored,
or careless.
A successful audit follows these few basic rules:
• Be specific about what you want audited and against
what criteria the audit is to be accomplished.
• Select individuals to conduct the audit who couldn't pos-
sibly be interested in the outcome one way or another.
• Brief the audit team carefully and give them time to
write a proper report
• Do not tell them in any manner what kind of results you
expect to find.
• Remember that the findings will point only to the front-
line troops. The real cause of the problems lies behind
the findings.

It is best to traina few key quality department individuals


to lead audit teams. Select team personnel at random from a
jury list of other operations. Don't insist that everyone on the
team be a specialist in the function to be audited. They are
guaranteed to come equipped with their own set of blinders.
One of the best audit methods is to prepare a "self-audit"
68 THE UNDERSTANDING
that applies to a specific function like environmental quality.
Let the operations conduct periodic audits of themselves, list
results,and act upon them. All you have to do to check them
out conduct a few measurements of your own that will give
is
you a good idea of their integrity and competence. By moni-
toring self-audits on a proper basis, you can cover much more
ground than by insisting on doing everything personally.

Quality Education. There is a theory of human behavior that


says people subconsciously retard their own intellectual
growth. They come to rely on clich6s and habits. Once they
reach the age of their own personal comfort with the world,
they stop learning and their mind runs on idle for the rest of
their days. They may progress organizationally, they may be
ambitious and eager, and they may even work night and day.
But they learn no more. The bigoted, the narrow-minded, the
stubborn, and the perpetually optimistic have all stopped
learning.
The only reason bring this up is that you have to recog-
I
nize what all teachers already know: some people are just
plain not interested in learning anything that will make them
have to change. Therefore, quality education needs to be visi-
bly oriented toward the product, the service, and the cus-
tomer. Actually, of course, it is aimed directly at the
individuals involved, but you have to go through the charade.
Quality Education takes three basic forms:

1. Orientation to the concepts and procedures of quality;


the problems that have a harmful effect on the product;
and the expectations of the customer.
2. Direct skill improvement in such specific things as solder-
ing, bellhopping, computer programming, telephone han-
dling, procedure writing, etc.
3. A continual low-level but concentrated barrage of quality
idea communications to serve as reminders and condi-
tioning, to make quality a thought always in everyone's
mind. Nothing flashy, just positive ideas that are in good
taste and current.

Now obviously a lot of self-improvement goes on in this


type of education. And if someone comments on how their
self has improved, it is a good idea to support that thought.
However, don't put yourself in the business of selling self-im-
provement
QUALITY ORGANIZATIONAL STATUS 69

Quality Improvement

It is important to list quality improvement in your policy


because you must not give any operation the option of
whether or not to have such a program. You don't have to do
the exact fourteen-step program detailed in Chapter 8, but
the operation won't be able to come up with anything better
and will end up following that program anyway. Whatever
the reason for beginning, history shows that once people be^
gin a quality improvement program they stick with it because
they grow to like the results and the newly found internal
management communications.

Consumer Affairs
Consumer affairs is a professional quality function. The
and future prevention
identification, investigation, resolution,
of customers' problems are actions that require the most pro-
fessional experience and training. To relegate consumer af-
fairs to a public relations function is to devalue PR by
implying that it is not an honest activity. Asking someone to
"jolly" a consumer along until the cause of the complaint is
forgotten no way to handle the situation.
is
Customers come in two types: amateur and professional.
The general public as a customer is unorganized, and acts on
an individual basis. The purchasing agent is acting for a com-
pany of some sort and is backed by that company. Both re-
quire equal protection. Both should be able to reach the ear
of someone who is on their side.
The customer deserves to receive exactly what we have

promised to produce a clean room, a hot cup of coffee, a
nonporous casting, a trip to the moon on gossamer wings.
Whatever it is, real or implied, we must do or make it well.
Otherwise our integrity systems concept is not genuine.
There are three basic action phases in consumer affairs:
1. Prevention. This involves monitoring advertising claims,
taking affirmative action in providing customer informa-
tion and education on using a product or service; estab-
lishing early warning systems to detect any potential
problems; and, of course, running a competent and inde-
pendent quality management system.
2. Awareness. Create 'listening posts" so customers can
reach you to tell you they are having a problem by —
letter, telephone, return postcard, any way at all. Are-
70 THE UNDERSTANDING
turn contact must be made within twenty-four hours,
and a communication started. Almost all complaints will
require only one contact, if you listen the first time.
Keep up with consumer legislation and regulations to
make certain your company does not violate the law.
For a modest fee you can purchase the services of a
newsletter, that will keep you informed. But industry
societies, and the quality societies, will be the most
active sources of information. Attend the meetings,
assist in the work. It will be a good investment of your
time. Most poor government regulations exist only be-
cause those who were involved didn't take the time to
offer positive guidance and suggestions on the best way
to legislate requirements or conduct regulation.
3. Correction. Satisfy the complaint fully, as quickly as
possible. The consumer is not out to rip you off except
in the most unusual of circumstances. I have very rarely
seen even a hint of such activity. There are much easier
ways to rip off the world than beating a big company
out of a few bucks. Naturally your legal department
should be aware of all your planned activities on a cur-
rent, but not serial, basis. The system that produced the
problem must also be corrected; otherwise you will go
through it all again. This is vital.

When answering complaints, do not use form letters; write


each person individually. In thinking the problem through,
imagine that the person making the complaint is sitting across
from you. This takes practice but becomes very natural after
a while. Your problems will cease much more quickly when
the customers feel a sincerity behind your messages. Con-
sumer affairs, after all, is basically professional quality man-
agement and common sense. No consumer affairs person
should ever have an office without pasting the golden rule on
the wall across from the desk, where it will be constantly in
view.

Product Safety

How can you keep your product from hurting your cus-
tomer or others? Prevent those kinds of problems through
planned design reviews, product qualification, and quality
control. Don't be unnerved by all the horror stories about ir-
rational jury verdicts and the intricacies of the law. Hardly
any of those things occurred because of the original incident.
They occurred because someone who had contributed to the
problem didn't have enough sense or courage to face up to it
early and get a reasonable settlement.
QUALITY ORGANIZATIONAL STATUS 71

I have never seen a product safety problem, real or poten-


tial, that didn't get itself handled with an absolute minimum

of expense when it was faced maturely. If you are wrong, ad-


mit it, correct it, and keep smiling all the time. Don't let the
lawyers, or the timid, panic you. Remember just one thing:
there are millions of products produced every day that don't
wind up in court. People just want their rights until you try
to trample them. Then they want revenge. And they just
might get it.
In a way, whole book is about product safety. The in-
this
tegrity systems concept is meant to produce an organization
that, while producing a nice return on investment, doesn't
make problems for itself or for others.
Speaking of integrity, let me make a very exact statement
I do not know of a single product safety problem where the
basic cause was something other than a lack of integrity judg-
ment on the part of some management individual. Usually
the objective was to achieve a short-range goal by cutting
corners. The result was a long-range and unprofitable
headache.
Product safety is not a legal problem, it is an ethical one.
6
Handling Problems

The Monday morning meeting started a little later than


staff
usual, but the tone was very positively before much time
set
had elapsed. Owen Bloody, the chief engineer, began to state
his feelings without waiting for any kind of call to order. In
fact some of the staff had barely finished settling themselves
into their seatswhen Owen tapped his finger on the table.
"I know this is your meeting, Jane," he said to the general
manager, "but before we get started with the numbers I just
have to get something off my chest. I got back from the
Evansville operation last night, and I can't tell you how upset
I am at the amount of quality problems we have out there.
No one is doing anything but reworking and repairing all the
equipment we shipped them. Didn't we bother to test any-
thing in the factory before it left? We
have to do a better job
of quality control than that or we'll be out of business. I tell
you it is disgraceful."
He turned to the quality manager.
"George, I knowyou're shorthanded, but how could you
let this happen? It's just awful. All those people with solder-
ing irons and drawings and wires all over the place. You've
never seen anything like it."
George didn't say a word. He just looked at Owen. Owen
paused and then stopped. He glanced around the room, ap-
parently looking for some sort of reaction. After a moment
the general manager spoke.
"Owen do you remember about nine months ago when
George and the manufacturing people wanted to hold up the
72
HANDLING PROBLEMS 73

Evansville product and bring the equipment up to the new


level of engineering design? And do you remember that you
didn't feel it was necessary, and you convinced me that the
changes didn't amount to much, and we could do them in the
field? Do you remember that I overruled George and we
went ahead and shipped?"
Owen nodded.
"Yes I remember all that Whafs that got to do with all the
defective hardware out there?"
The general manager leaned forward
"The hardware isn't effective, Owen. It looks just like the
design. All the work being done out there is installing the en-
gineering changes that you said didn't amount to much. Ev-
ery bit of that mess is because you and I wouldn't give the
factory a little more time to do the Job right That big "qual-
ity problem" out there is an engineering problem. It fa our
bird that has come home to roost Owen. Yours and mine. I
doubt if George is even interested."
There was a lot of silence. Then the general manager
turned to the comptroller and said: "Let's look at the num-
bers."

No person is so exposed as when that person starts to


handle a problem. At that point, as with no other, smooth,
civilized veneers evaporate, and the real self emerges. I often
feel that way about people who drink. The real person is the
one who emerges right after the "buzz" begins.
Many people are at their absolute best when they face diffi-
culty. Many become cooler, calmer, and clearer as problems
deepen. Many shine only when there is trouble; many are, in
fact, dull without it. Many do not shine.
I think that all of us might do something we could be
proud of if we stood alone, between our families and harm,
or if our country demanded some sort of obvious sacrifice.
But situations are not always so straightforward. The less
clear the challenge, and the result, the more complicated the
response becomes.
Suppose, for instance, that you were standing on Fifth
Avenue in New York watching a parade. Suppose in that
parade an honored national figure was marching, someone
you personally admired and respected. Someone whom you
felt was a valuable individual in our world. Now suppose you
74 THE UNDERSTANDING
overheard two people talking about how they were going to
shoot your hero when the parade passed. You looked, and by
George, they really did have guns.
Would you tell that police officer over there? Would you
tell the secret service agent standing nervously with a walkie-
talkie only a few feet away? Certainly you would. You
wouldn't want to get involved, but after all your duty would
be pretty clear.
Now suppose you didn't know they were going to do this
until you suddenly noticed one of them raising the weapon
and pointing it.Suppose the potential assassin was standing
right next to you. Would you push him to destroy his aim?
Would you yell out to alarm everyone? Certainly, or at least
probably, you would. It would be an almost natural reaction.
Now suppose you could know, with absolute certainty, that
you would be wounded if you did interfere? Would you still
do it? Suppose you knew that you would be killed, but the
parader would be saved? Suppose you knew that you would
become a national hero, mourned by millions? After all, you
have to go someday anyway. What would be your choice?
Let's play the fantasy out Suppose you knew that you ab-
solutely would save this honored person's life, but that you
would be accused of the assassination attempt. Your name
would go down with Czolgosz, Booth, and Oswald. You
could solve the assassination problem, but would be
destroyed.
What would you do?
Most company problems don't require a specific life-
At least not
or-death commitment. physically. But each hu-
man conflict produces winners, losers, and observers. No one
is exactly the same after being involved. Each mental or
physical action we take adds to our knowledge and alters our
attitude. It is said that at age fifty, people have the face they
have earned. How you react to problems has something to do
with the face you will earn.
When Uncertainty receives a problem, the attack is on.
Problems are recognized as the enemy. They must be thrown
off the ladder, and the ladder tossed down on top of them.
Heavy breathing and stand-up discussions are part of this
type of problem handling. If nothing else the actions have to
clear a space for the next problem, which is at this moment
building a ladder out there in the woods.
People who live in this environment for a while, begin to
believe that yelling and screaming are what it is all about. If
HANDLING PROBLEMS 75

theirrank is not high enough for them to be doing the



screaming themselves, they learn to avoid the sessions and
the problems. They learn the art of excuses.
Operations that truly want to handle problems, for the pur-
pose of solving them, must create an open society within their
walls that is imbued with the basic concepts of integrity and
objectivity. Integrity in this case means the general attitude
that "we do things right around here because that is our pol-
icy and because it is the right thing to do." That eliminates
the possibility of attaching virtue of any sort to deviousness
or subversion. The open and straightforward path is the way
to get ahead.
Objectivitycomes with not placing the blame for problems
on Aim the questions and probing at the job. The
individuals.
job is what failed, not the individual. It may be that the two
are imperfectly matched and you have to change one or the
other. Either way, the individual has the chance to improve
another time, under different conditions.
Going on the premise that the job is the target, we can
deal with problems in the system on a straightforward basis.
Problems are announced and discussed, and reasons for them
are assigned. This assignment carries with it the responsibility
for true definition of the situation, for communicating with
those who are involved, and for bringing out an action plan
with a specific timetable.
Over 85 percent of all problems can be resolved at the first
level of supervision they encounter. Of the remaining 15 per-
cent, about 13 percent can be resolved with two levels of su-
pervision, or two different departments, agreeing to change
something or act together in a certain way. The remaining 2
percent might require as many as three operations or levels of
organization. But they can be solved.
Once in a while you come up with something for which
there is no solution. Then you make a judgment and accept
the situation, and life goes on. Count on one or two per
career.
When the Earl of Mountbatten had the task of dividing In-
was absolutely no way to fairly divide Kashmir be-
dia, there
tween the new states of Pakistan and India. With the
agreement of both sides, the English government selected a
draw the line. The key
brilliant jurist, Sir Cyril Radcliffe, to
thing about Sir Cyril was not only that he had never been to
India but that he knew almost nothing about the country.
Armed with no preconceived notions, he drew a line that, as
76 THE UNDERSTANDING
any line would do, caused disruption and heartache. But it
was done, the wounds have healed, and there were no recrim-
inations over the line itself.

SOME CASE HISTORIES


Specificproblems require specific solutions. One company
had with problem resolution, performance
difficulties
measurement, and absenteeism, among other things. The real
situationwas that the supervisors just weren't participating in
the Zero Defects program. To help this company solve its
problems, I wrote a special set of case histories and lectures,
with the provision that they be administered and conducted
by the next supervision level higher than the supervisors in-
volved in the immediate problem. At first management
wanted the training department to do it, and the source of
some of the difficulties became apparent After some persua-
sion, my proposal was agreed to. The results were quite
dramatic. Everything improved, and the Zero Defects pro-
gram really took hold.
Although the cases are very manufacturing-oriented, the
thought process applies to any company and to all levels of
management They provide an example of how both student
and teacher can learn from the same session.

LECTURE 1:
SUPERVISORY PROBLEM SOLVING
One of the great challenges to individual supervisors is
deciding how to distribute their time. They must fulfill
their responsibilities to their companies, their subordi-
nates, and of course to themselves. The demands for at-
tention seem endless: schedule control, employee
administration, training, parts availability, absenteeism,
meetings, quality, budgets, etc., etc Sometimes it seems
that the day is over before even half the problems have
received any notice at all.
Most of us have encountered this problem and have
taken steps to correct or eliminate it Unfortunately, our
best intentions often go to waste because of problems
that occur out of "nowhere." Just as you are about to
take a moment to bring the shortage report up to date,
someone runs up with the news that the air line broke at
HANDLING PROBLEMS 77
station X. There's twenty-five minutes shot. Just when
you think you'll have time to give that new employee a
little extra training, you're notified that you have to at-

tend a meeting to talk about how to improve your oper-


ation and perhaps even manage your time better. So far
the only thing that has happened is that you have lost
time.
As experienced supervisors, you know the danger of
trying to apply one set rule of time allocation that cov-
ers every situation. We all encounter situations that are a
little different, or at least we think they are. The supervi-
sor's primary function is to direct the work of the per-
sonnel assigned to his or her operation. Yet this primary
function sometimes becomes a secondary one because of
our tendency to concentrate on "the problems of today."
Not only are such problems vital, they are also usually
more interesting than the overall system.
Therefore we are not going to say again that the su-
pervisor should be dedicated to spending more time with
each person. We have all tried that approach many
times. Dedication is not enough. Rather let us decide
how we can best utilize the amount of time we have
available to us. If we are going to do that, we must de-
termine what we want to accomplish during the time al-
located: "What are the goals we should attempt to
accomplish during the time we have available for our
people and our problems?"
Class Discussion:
Attempt to obtain a consensus on at least eight goals and
list them on the blackboard. Encourage discussion by re-

maining silent for a minute or two. Some goals that


might be listed are:

• Get them to understand their job better.


• Try to learn their interests.
• Improve training.
• Find out what problems they are having.
• See how we can help in their development.

• Get them to meet their quotas.

(A great number of items might be given by the supervi-


sors. List them under the headings of quality improve-
78 THE UNDERSTANDING
ment, performance measurement, and employee
identification with the job.)

Resume Lecture:
Now we can take these items one at a time. Let's start
with quality improvement Just what does this mean?
Quality means conformance. When we talk about qual-
ity, we are really referring to the compliance of the
product Does it look like the advertisement? Does it
conform to the requirements? Will it do what the cus-
tomer has been led to expect? All the effort put forth by
the supervisor in schedule and budget control can go
quickly to waste if the product is not produced correctly.
It is vital that we as supervisors understand this and,
more important that our people understand it
We all recognize that we need to do a better job in
the quality area. Unfortunately, we may not recognize
the steps required to achieve this improvement That is
the purpose of our discussion today. Nonconformance is
caused by three things in an assembly area:

1. The materials and products supplied for assembly are


not in conformance with their requirements.
2. Personnel and/ or tools required to perform the job
are not adequate.

3. The supervisor has not set high enough standards for


employees.

not necessary to determine the order in which


It is
these causes are affecting your area. All that is required
is to take a close look at the defects created, and decide
which causes apply.
Let's take an example.

Case History 1

"Assembly," thought Charlie Gordon, "is just making big


ones out of little ones. Why do you suppose that we are hav-
ing such difficulty running a good assembly area?"
Charlie was muttering to himself as he stood, clipboard in
hand, near the rework station serving final assembly. He
watched as the units moved briskly through the repair
process. It seemed like more of them had to come here every
day. The whole line was falling behind schedule, overtime
HANDLING PROBLEMS 79

was ruining the budget, the repair foreman was yelling for
more help. The quality control people were walking around
shaking their heads.
Life was not very pleasant for Charlie Gordon. The super-
intendent had called him in for a chat yesterday. The purpose
of this chat, Charlie soon discovered, was to let him know
that thisrework problem had better get solved and soon.
Costs were going out of sight. Did Charlie have any ideas?
Charlie didn't, but he promised to look into it and try to
come up with something. So there he was, with a long list of
problems and discrepancies before him, staring blankly into
space.
"This isn't getting us anywhere Charlie boy," he decided.
"You'd better sit down and give this a good think." He re-
turned to his office.
The figures were very clear: 100 units per hour came off
the line; 14 of these units required work in the repair station,
and 6 needed some sort of touchup in the line. There was a
20 percent failure rate, and each repair usually involved 2 or
3 items per unit.
Reasoning that the place to start was with the defects,
Charlie began to review the list before him:

Defects per
Item Cause hundred units

Missed operation Workmanship 13


Paint scratches Workmanship 9
Wrong part Production control 12
Part failure Vendor 2
Gaps Workmanship 11
Misalignment Workmanship 6

Many other items were listed, but they didn't occur often
enough to be significant at this time. Charlie decided that the
main item to be attacked was workmanship. Before mount-
ing his white horse, he thought it might be a good idea to
make sure in his own mind that the causes listed were correct
He approached Ann Collins, a line leader, with the ques-
tion of missed operations. "How does it happen, Ann, that we
miss this many steps? Don't the people have their minds on
the job?"
80 THE UNDERSTANDING
Ann responded: " 'Mind on the job' isn't the whole story.
You have to look at everything that is put into the classifica-
tion of missed operations. For instance, suppose there is a
shortage when the unit moves through. Instead of stopping
the line, we just mark the ticket, and the unit gets pulled off
into repair when the part catches up with it. Why they call it
workmanship I don't know. We
did have a couple of occa-
sions when somebody really did miss an operation, but it
doesn't happen often."
Charlie was beginning to feel that he was getting some-
where, so he hustled over to talk with the production control
supervisor.
"Charlie," said Elvin Walker, "you have been taken. Short-
ages happen now and then, but not at the rate of 13 percent
of the units. Really it's less than 1 in 100, and then it cer-
tainly isn't charged to workmanship. I'm afraid that those
guys on the line just don't want to own up to their problems."
Charlie was becoming more confused than ever, so he de-
cided to examine another type of defect and see if he could
pickup a better understanding. The next highest on the list
was "gaps," but he put that aside temporarily because
several departments were involved and he could already
imagine the story he was going to get on that one. Better se-
lect something less complicated, like "paint scratches."
"Paint scratches," said Ann Collins, "occur for one rea-

son the vendor leaves burrs on the moldings. When we
make the attachments, the burr cuts the paint and produces a
scratch. You get those burrs off and the scratches will disap-
pear right now."
When Charlie approached the purchasing agent and the
supplier quality analyst, they did not agree with Ann's story.
"Sure we have a burr now and then, but the vendors have
been making a lot of extra effort to get rid of them. Look at
this lot we just received. I'll buy you a lunch you can dis-
if

cover a single burr on any part. Why don't you tell those
guys on the line to quit hitting the paint with these moldings,
and their tools. That's what causes the scratches."
Charlie went back to the repair area just to make sure it
was still there. The only thing he had learned today was that
no one was causing a problem. If no one was causing a prob-
lem, why was the repair area full and getting fuller?
While Charlie is searching for some sort of an answer, let's
examine the situation in which he finds himself. It is apparent
that no one feels responsible for the defects that are occur-
HANDLING PROBLEMS 81

ring. All the individuals have determined that they personally


are not the cause. In their minds, Charlie's responsibility is to
let others see the error of their ways and make them start
performing their assigned tasks properly.
Yet if no one whose mind should be changed?
is at fault,

The units are created by individuals, and each has a responsi-


bility.How can they be made to see it? Surely quality im-
provement has no chance unless the individuals are ready to
recognize that improvement is necessary.
Charlie brought the supervisors together: line assembly,
production control, quality, purchasing, and industrial en-
gineering.
"All I have learned from my investigation, * he stated, "is
5

that I do not understand the reason that these defects are oc-
curring. Each of us seems to feel that we personally are not
responsible for them. Therefore, I would like to say that I ac-
cept the responsibility, since I am charged with eliminating
them. I need your help to do this. So the question before us
is: How can we stop me from causing all this repair work?"

He handed them copies of the data and waited for some


response.
Ann Collins spoke up first. "I think we have been listing
things as being caused by *workmanship' too freely. You can
classify everything that way if you r/ant to, but it is too
broad a term. We
should start being more specific and deter-
mine things like 'tool malfunction,* 'worker error,' 'part short-
age,' 'wrong part issued,' 'training lack,' and so forth. Then
each category would be investigated separately to determine
the real reason for its existence."
Tim Ebons, the quality control engineer, agreed. "We
could do that, but it would require everyone's assistance. It is
very hard to get people to agree that their area is responsible
now."
Purchasing suggested that they talk with the repair people.
"They should have a good idea of what is causing the de-
fects."
They took the meeting to repair. Charlie explained the pur-
pose of the gathering, and the head of repair was only too
pleased to be included in the effort. Charlie requested that
they start with the defects classified as "missed operations."
Some of the items listed in this category were:
• Two parts installed backwards
© One part missing due to a shortage
82 THE UNDERSTANDING
• Six parts that had one screw or another attachment device
missing
• Four units with all the parts installed but with the wires
not connected

Ann Collins commented that things didn't seem as clear to


her as they had before. She also volunteered that perhaps she
had never really understood what "missed operation" was
supposed to mean.
They checked out several other defects, and determined
that in each case the group did not have a clear and unani-
mous understanding of just what the different classifications
meant.
"It is apparent," said Charlie, "that we will have to develop
a better method of communications in this area."
The team agreed. During the next few days each person
made a contribution to Tim Ebons, who was charged with
putting the analysis list together. As a result a new procedure
was developed.
Each defect that occurred more than once was investigated
by two members of the team in order to determine its exact
cause and the method to be used in preventing its recurrence.
Once the assembly personnel began to feel that the team was
serious about wanting to eliminate the errors, they began to
make very practical suggestions. Soon problem identification,
analysis,and correction became routine. The repair area be-
gan to have less business, the schedule began to recover, and
the operation was on its way to being back on budget.
None of the steps taken were remarkable in themselves;
they were usually just common sense. What was remarkable
was that the effort could take place so quickly once everyone
started working without fear of being criticized for causing
the defect in the first place.
Some of the actions taken to eliminate the defects were as
follows.

Part installed backwards. It was found that the reverse in-


stallation occurred while a relief worker was on the line.
(The part in question does not apgear to have a different
front or back, and only an experienced assembler can tell the
difference. This happens very often with diodes in electron-
ics.)

Solution: Engineering was requested to add a directional


arrow on the body of the part. While the change was go-
HANDLING PROBLEMS 83

ing through, the purchasing agent got the supplier to


color-code the front end with a small paint dot

Result: No further occurrences.

Screw or other attachment device missing. Investigation deter-


mined that these defects occurred during the final moments
of the work shift. Production control had been placing the
exact amount of attachment devices in the assembly bins.
However, screws were occasionally dropped or found to be
defective themselves. Therefore, the assembler could be short
of screws and have no time to obtain replacements.

Solution: Extra fasteners were placed on the line in


reserve packages. When the assemblers required addi-
tional screws, they could break open the package and
proceed. The line moved on, but the broken package be-
came a signal for production control and industrial en-
gineering to reevaluate methods.

Result: No further occurences.

Paint scratches. It turned out that the vendors were delivering


burr-free parts, but no one had told the assemblers about the
change. They had little faith in the moldings from this stand-
point, and therefore expected to see some scratches occur.
They weren't careful in the installation.

Solution: Line management took great pains to identify


the assemblers who worked on each unit so that any
scratches could be charged back to them and they could
be instructed on better mounting techniques.

Result: Scratches dropped off dramatically. However,


the most important result was that the vendors, upon
being told about the procedure, became even more
burr-conscious.

Wires not connected. It's hard to believe this one, but the
work instructions didn't tell anyone to connect the wires at
all. They merely described in great detail how to assemble the

parts. Workers who made the attachment did so only because


they knew it had to be done.
84 THE UNDERSTANDING
Solution: Work instructions were clarified.

Result: Defect occurs less than once a day.

Wrong part. The part involved turned out to be decals.


Special units being constructed required decals of a different
color from those ordinarily used. Also the assembler making
the error was color-blind and could not tell the difference be-
tween the two decals.

Solution: Assembler was transferred to another oper-


ation.

Result: Still getting one or two a day because the fre-


quency is not sufficient to develop a habit pattern.

Gaps and misalignment. An industrial engineering analysis


showed that half these defects were caused by unanticipated
tolerance buildups in the tools. The other half defied analysis
until one of the supervisors noticed that the assemblers in the
fitting operation were using a positioning technique applicable
to the model from the previous year instead of the one
recommended. Questioning revealed that these assemblers had
not been part of the training sessions set up for this oper-
ation.

Solution: Assemblers were retrained. The industrial en-


gineers were asked to rewrite their tolerance guidebook.

Result: Misalignments have become very rare. Gaps,


however, still exist within the tolerances of the original
sheet-metal parts. Corrective action is being taken in the
stamping area.

CASE HISTORY QUESTIONS


1. Why do you feel that the individual supervisors were
so convinced that the defects were not their fault?

2. What changes took place once several supervisors


were involved in a common effort?
HANDLING PROBLEMS 85

3. Do you think the supervisors had given understand-


able performance standards to their people? (Dis-
cuss.) _
4. What there about identifying the real cause of a
is
problem that makes it so easy to resolve?
5. What do you think Charlie should do to make sure
these problems do not occur? -

6. What actions should be taken to ensure continuous


quality improvement? —

QUALITY IMPROVEMENT SELF-EVALUATION


The supervisor who wonders how
to effect quality im-
provement in his or her area should ask the following
questions:

Do I really understand the cause of the defects that


occur? —_—^-^^^-_______*_ _-
What are the most frequent defects occurring in my
area?

What defects occurring are the most expensive to repair?

Do I feel that any of them are the fault of my people or


myself?
If so, which ones?

If not, who do I feel is responsible?.

Have I talked with the other departments involved about


the defects that concern me?
What was their reaction? .

If I could eliminate three problems, what would they be?

Do I feel that I am personally responsible for causing


any of these three problems?

Suggestion:
Select one of the three problems listed and analyze it in
depth. Guideline questions:
86 THE UNDERSTANDING
How do I know the problem exists?
What is the apparent cause of the problem?.

What do the other people involved say the apparent


cause is? (Doesit agree with yours?)

Have I asked anyone not directly involved to look at it?


What did this person say?

PERFORMANCE MEASUREMENT
Supervisors like explorers, must know where they have
been to know where they are so they can plot the course
to get where they want to go. To put it another way:
Unless you know how you are doing as you move along,
you'll never know when you're done or if you have
succeeded. Each characteristic that makes up your proj-
ect must be considered.
The broad characteristics that interest the supervi-
sor are schedule, cost, and quality. Of course each of
these areas can be further broken down, since they are
only end results of a total effort We
must be able to
identify these component parts and measure them before
we can know how our schedule, cost, and quality are do-
ing.
For instance, schedule is affected by such things as
parts shortage and absenteeism. Quality will be affected
by training and attitudes. Cost will be affected by wages
and repair. Let's list some other items that affect each of
these characteristics.

Class Discussion:
Here, follow the same procedure as that described in
Lecture 1. Obtain a consensus and write the items on the
board under the headings schedule, cost, and quality.
How many of these items have a dual or triple ef-
fect? Absenteeism, for instance, affects schedule by re-
ducing the amount of work that can be done; it affects
cost by requiring additional overtime; quality is jeop-
ardized by the possibility of untrained personnel having
HANDLING PROBLEMS 87

to be put into specific jobs. There are several other items


with multiple results.
What is the point of recognizing the tie-ins?As you
will see in the accompanying case history, the supervisor
can learn to predict what is going to happen to es-
tablished controls by understanding the relationships
shown in trends. No measurement is sufficient to
single
provide this knowledge. Using this information is part of
the supervisor's technique in allocating time properly. If
you know the areas of potential weakness, you can
concentrate on them. If you wait until the water begins
to pour in through the roof instead of taking action
when the first leak appears, it may be too late. Things
move too fast. People like to think that they shape
events, but in reality it is the other way around.
Proper usage of our time depends on how well we
are able to understand events that are occurring and
how we attempt to mold them to fit our own desires.

Case History 2
"It seems to me," said Charlie Gordon (to himself), "that
the only time the old man ever invites me for a 'friendly*
chat is when he has a tough problem to give me. This time I
think he has overextended the 'friendly* bit. All I have to do
is to show George Thomas why his line is behind schedule.
George was my first boss when I came here, and he's proba-
bly the most senior supervisor we have. George isn't going to
like this. But we'll give it a try. Wonder if I should put on
my suit of armor?"
Much to his surprise Charlie was warmly received when he
stepped into George's small office. "I'm glad the old man
(who was 10 years younger than George) sent you down
here, Charlie. Maybe you can help me get him straightened
out on this thing."
Charlie opened his mouth to start his pitch, but George
was not to be denied. He waved him off and launched into
his own analysis of the situation. "My line is off eight units

an hour that's eighty a day. It's running my costs way up
because I'm having to work overtime on the weekends to get
close to breaking even. On top of that the defect rate is ris-
ing, and I've had to expand my repair area. All of this came
on us very quickly without any warning.
"Now I know what is wrong, but I haven't been able to
88 THE UNDERSTANDING
make the old man understand. why I asked for you to
That's
come down here. I've made a of what has to be done to
list
fix the problem. Now you take a look at these, and then let's
talk about what is the best way to present these to our man-
agement If we're going to have Zero Defects around here,
we all have to help."
George leaned back to light his pipe as Charlie picked up
the typed list. The recommendations were four:

1. Reduce the schedule requirements of the line by 15 per-


cent (Justification: The people we are able to get today
are not interested in doing a good day's work; they are
just not able to handle the present line speed.)
2. Retrain the inspectors in order to improve their judg-
ment. (Justification: Inspection is overly aware of minor
defects on basically sound items. They are continually
writing up almost invisible marks and gaps.)
3. Reorganize the production control operation. (Justifica-
tion: Parts shortages are a continual headache. We like
\ to stay at least two hours ahead of requirements, and
current parts shortage practice is one hour.)
4. Crack down on the vendors. (Justification: We have had
several shortages in the past few weeks that required us
to store units until parts arrived. The quality of vendor
items has not been very good either.)

Charlie peered at the list and placed it back on the table with
a sigh. George laid down the pipe.
"OK, Charlie. Let's see how we are going to convince the
old man to take these actions. If he really moves in, well be
back on schedule before you know it."
"I don't think hell buy it George," said Charlie. "I think
he feels that we should have known about and prevented our
situation before occurred, and I'm pretty sure that he won't
it

accept the first three recommendations. He is working on the


fourth one, but our studies have shown that it really isn't too
big a problem. Perhaps we should take a look at the charts to
see we can determine how we got into this situation.
if

Maybe we can figure how to get out of it if we find out how


we got in it."
George obviously didn't care much for this suggestion. He
thumped his fist on the table. "Charts, charts! What do they
tell you? I don't need them. I can stand near a line and tell

you the output just by listening. I used to be in production


control, and I know when inspectors are nit-picking. I know
all their tricks. What are these charts going to tell me?"
HANDLING PROBLEMS 89

Charlie was wishing he had accepted that offered transfer


to Europe.
"Well it won't hurt us to take a look at them will it,
George?" he asked. "When we go see the old man, he is sure
to want to know how we feel about the current trends. . . •
We can hardly say that they haven't even been reviewed."
Grudgingly George agreed, and, after some poking around,
his secretary managed to find the neglected charts. Charlie
selected the ones that described schedule performance, defects
per unit, absenteeism, and shortages.
•The cost charts can be of use to us later, but let's start
with these. If we place one above the other we will be able to
see what was happening at any specific time."
Both men moved around to the conference table and began
to examine the papers.
"Let's look at the schedule performance first. You have
been over the 100 units required on five different weeks."
•That's right," said George. "I always like to get a little
ahead."
"OK, but look what happened to the shortage and defect
per unit charts after that. You know that the parts are pro-
grammed in at the specific rate of 100 per hour. When you
produce ahead of that figure, you are requiring the issue of
parts programmed for the following day and purchased for
that purpose."
"These new systems don't make much sense. But what are
you trying to say?"
"Well, you'll notice that the absenteeism peaks follow the
schedule peaks? And that the defect-per-unit peaks precede
the schedule low points?"
"So?" said George.
"Doesn't that indicate that a major reason for your
schedule delinquency is the defect rate? When you have de-
fects, you have repair. When you haverepair, you have less
people available for the which places a greater strain on
line,
the line people. They get tired, or disgusted, and stay home to
rest once in a while. Your total absenteeism is on an upward
trend. The way this chart looks you and I will be the only
ones here in ten more weeks."
"I think you're trying to convince me of something by
using hindsight. Anyone can say what made something hap-
pen after it has all happened. Look at the stockbrokers. I
never thought you'd be a Monday morning quarterback,
Charlie."
90 THE UNDERSTANDING
"I'm not pretending that you can know the future just by
plotting the past, George. But you must admit that some
trends do repeat. Here I think it's a clear case of cause and
effect. Let's look at our status today and see if we can deter-
mine what is going to happen to us in the next week. If we
can predict that, then you'll have to admit that the trend
charts have some value to the supervisor by letting us know
what things to take action to prevent."
"Now, that's a sporting proposition. I'll tell you what. You
write down three events that you think will happen within the
next six work days and we'll seal it in an envelope. At the
end of the six days well list what actually happened, and
then well open your envelope. If you're right on two of them
I'll buy us both dinner. If you're wrong, you help me con-

vince the old man to get a little more practical."


Charlie began to have a mental picture of himself in the
unemployment line, but he was too far committed to stop.
"OK," he said. "You get a new copy of these charts every
week. I'll take this set and use them to predict what is going
to happen next week. We'll put the charts in the envelope."
The agreement was made, and Charlie marked the charts.
They were then locked in the file cabinets, with appropriate
ceremony. At the end of the next week Charlie and George
got back together. George had his new charts clutched to his
chest. "Open the file and let's compare. That will give us time
to get up to see the old man this morning."
After a detailed comparison George sat back in his chair
with an air of amazement. "You hit three out of four, and
you didn't miss the fourth by that much. How did you do it?
Is there some new technique that I don't know about?"
"No new technique George. Same old You can do it
stuff.

as well as, and perhaps better, than I can. The only problem
you have is that you haven't taken time to study the charts to
get the overall picture. I think you have a mental block about
them. All you have to do is recognize that the days are gone
when one person can keep all the data mentally. In fact, I'm
sure you could develop some new measurements and teach us
how to use them. That's what our Zero Defects program is all

about prevention. If we can learn how problems happened
in the past, then we can learn how to prevent them in the fu-
ture. I took your charts and listed them in a different order to
compare what has happened in the 20 model weeks. I
marked the 'take action' points with an asterisk."
HANDLING PROBLEMS 91

Charlie and George looked at the figures together (see ac-


companying table)

Cost Data for Case History 2


Defects
Week Output Absenteeism, % Shortage per unit

5 96 0.5 None 3
6 104 0.5 None 2
7 106 0.4 None 2
103 None 6*
8 0.4
9 97 1.5* 0.2 5
10 97 2.0 0.8 4
11 93 0.4 None 4
12 104 0.4 0.4 10*
13 104 1.0 0.6 8
14 97 2.0 0.2 11*
15 93 1.4 0.6 15*
16 87 3.0 0.8 7
17 87 3.0 0.4 5
18 87 1.0 None 8*
19 92 1.4 None 12*
20 92 2.4 None 15*
Charlie's predictions:
84 3.0 2 17
Actual:
21 84 2.8 2 17

"Now," said Charlie, "the important thing to consider is


that, within the limits of your control span, schedule is a
result of the other three measurements. Absenteeism goes up
and down on its own sometimes, but it can be traced to de-
fects per unit in your area. Defects slow the work, cause frus-
tration, and force people into the repair area and into
overtime. If you'll notice, absenteeism increases following de-
fect-per-unit increases, as does parts shortage. You have to
take immediate action any time defects start to rise. And if
youll really get behind the Zero Defects program, maybe you
can eliminate defects altogether, or at least come closer."
George decided to give it a try. In a few days Charlie was
pleased to report to his boss that the situation was much im-
proved. However, his boss gave him another assignment
Seems the planning people were being driven up the wall by
all the data requests that were coming from the line supervi-
92 THE UNDERSTANDING
sors after George had finished talking with them. Would
Charlie see what he could do about it?

Discussion Questions
1. How valuable do you feel performance measurement
data are to you in conducting your job?
2. Do you feel that you can predict trends?
3. What additional data would you like? Who should pro-
vide it?
4. What are your favorite indicators?
5. What specific actions do you take when you detect an
unfavorable trend in any of the indicators?

LECTURE 3:
EMPLOYEE IDENTIFICATION WITH THE JOB
It isan old phrase but true: "The supervisor is a person
who gets things done through people." There isn't any
other way. So as we consider our time allocation, we can
easily see that one of the prime considerations is our
relationship with those who depend upon us for guid-
ance, leadership, and support In this age of machine
technology the supervisor-employee relationship is even
more important As people's jobs become more special-
ized, they become more difficult to replace and to
train. The days of placing a tool in an individual's hand
and pointing that person to the job are over. Too much
depends upon the interrelationship between the specific
job and the specific person.
Many supervisors today feel that their people are
interested in the job only as a source of income. They
can find "proof* of this all about them if they wish to do
so. Such proof is easy to find if you search for it and if
you have made up your mind before you start that you
will find it If you start with a more objective viewpoint,
you won't find evidence supporting the view that workers
care only about salary. Let's consider just a moment
What do you work for, personally?

Class Discussion:
List some of the reasons that the supervisors in the room
work, taking care to point out that they obviously ex-
pend a great deal more effort, both on and off the job,
HANDLING PROBLEMS 93

than isrequired by their specific job descriptions. The


list, after you get past the erroneous chorus of "money/*

will include such things as feeling of accomplishment,


recognition, achievement, personal satisfaction, and se-
curity. Point out a few tilings that people won't do for
money, such as hit a friend, leap 40 feet into the air, sell
their families, etc. Money is a score-keeping mechanism
that tells how well you are meeting your personal objec-
tives. It has not proved very successful as a motivator in
industrial environments. (Aristotle said that the purpose
of working to provide for leisure.)
is

Now ifthese are the reasons we are interested in


working, why should we consider that our employees are
much different? I have seen supervisors work many
hours without pay in order to get a job finished on time.
I have seen them return to the plant, long after their
shift, just to make sure personally that something was
going right. Why do they do these things?

Class Discussion:
Ask for some reasons, and perhaps list them on the
board. Here the answers will revolve around job dedica-
tion, desire to complete things they are responsible for,
promises that they made to superiors, and just general
job dedication.
If all employees had the level of dedication we have
just discussed, we would rid ourselves of problems such
as absenteeism, lack of attention to detail, and lack of
job interest. Perhaps we should examine some reasons
why employees often do not have the same level of job
interest as their supervisors.

Class Discussion:
Ask for reasons. If the group is with it, they should offer
items like: they don't feel as important; their job is
pretty cut-and-dried day after day; they don't have the
same opportunity to know what is going on that we do;
they don't get that much association with upper manage-
ment; they don't have the same dedication to the com-
pany. If you get answers like "They are not interested in
progressing or doing a good job," ask them how they
know.
Absenteeism, for instance, is usually a good indica-
tor of job interest or the lack of it. One of the responsi-
94 THE UNDERSTANDING
bilities we have as supervisors is to help employees
identify with their jobs. Perhaps there are some things
that should be accomplished by management at all levels
in order to increase employee job identification. What
sort of things should be considered?

Class Discussion:
The items brought up can be categorized under the
heading employee communications. When all the items
are listed, try to select those that are the responsibility of
the supervisors themselves. There will probably not be
too many in this category. Discuss this point and try to
point out other specific items that the supervisors can do.
For can find ways of showing
instance, the supervisor
employees how they are performing, and give them an
understanding of where the work they do originates and
who gets it after they have finished. Supervisors can en-
courage employees to tell their work problems to the su-
pervisor so a way can be found to solve the problems.
In the final equation, the supervisor is the person
the employee sees as "the company." The type of work
accomplished and the attendance maintained by employ-
ees are very much indications of their relationship with
their supervisors. That is why some areas have high ab-
senteeism, while others have less. The supervisor needs
and deserves support in these relationships, and the com-
pany must consider methods of assisting. But in the end,
it is up to the supervisor to assist the employee to de-

velop job identification, and it may be the supervisor's


most important job.

SELF-EVALUATION ON EMPLOYEE JOB


IDENTIFICATION FOR SUPERVISORS

1. Do you know the first and lastnames of your


people? Yes No
2. Is your absentee rate lower this month than last?
Yes No
3. Could you make a listing of your people in order of
their proficiency? Yes No
4. Could you make a listing of your people in terms of
job interest? Yes No
HANDLING PROBLEMS 95

5.Have more than 10 percent of your people partici-


pated in the suggestion program? Yes No
6. Do your people ever ask specific questions about the
growth of the company or its goals? Yes No
7. If so, do they receive specific answers? Yes No
8. Do you feel that you have given them a perform-
ance standard that they understand? Yes No
9. Do you show new employees the end result of their
work (such as a tour of the area it goes to when
they are finished)? Yes No
10. Do you feel that your people have as good a re-
lationship with you as you do with your boss?
Yes No
Rating (Numbers of yes answers)
10 Should run for President
9 Gould be Secretary of State
8 Would make a good ambassador
7 Should run for vice president

Cos* History 3
Elmer Currant peered over his coffee cup. His daughter
was hastily making some notes as she finished her breakfast.
"Got a history report today, Dad," she replied to her fa-
ther's unspoken question. "I forgot to make an outline, but I
have a study hall first period so it'll come out all right." She
gulped her milk, waved kisses at her family, and disappeared
out the door.
"I don't know," Elmer said to his wife. "Kids just don't
seem interested in their work these days. They wait till the
last minute to do everything and then they don't do a good
Job. It's like most of these people we have at the plant now.
They just do what they have to, and don't seem to take much
Interest in really doing a good job. Seems like I have to drive
my group harder every day just to get the minimum output.
Things aren't like they used to be."
His wife placed the pancakes and sausage in front of El-
mer and permitted herself a little "I've heard this before"
smile.
Elmer continued his analysis between bites.
"When I first started on the line, there was a sense of
teamwork. We knew that if we didn't do our job, we'd be let-
96 THE UNDERSTANDING
ting the other people down. It took everyone to produce. We
were a team. Today everyone works for himself. Why the
other day a part dropped on the floor and two guys walked
around it for an hour without making any effort to pick it up.
When I asked them why they didn't move it, they told me
they didn't drop it. We didn't do that when I was on the line.
"It's just like your daughter. When I had a history report
to do I didn't wait until the last minute. That teacher would
have killed me. We had to work a lot harder, and we did."
Marilyn Currant stared at her husband.
"Elmer Currant," she said, "I went to school with you for
eight years. I happen to know what your grade average was,
and I happen to know what your daughter is achieving. She
gets almost all A's, and has never had less than a B. She does
at least two hours of homework every night, plus music
lessons, plus band practice, plus Girl Scouts, plus Youth Fel-
lowship. How can you say she doesn't work hard? I don't
remember you doing all those things."
"Well, perhaps I was a little hard on her. But you must ad-
mit that things are different in the plant. I remember my first
boss —
we all worked extra hard for him and for the com-
pany. We were always the top area. Nobody cares about that
now. You should see our absentee lists. Why nobody ever
missed a day then unless they had a broken arm or some-
thing. I remember Ev Brown trying to come to work on
crutches once just because it was the rush period."
"What do you think is different now, Elmer?" asked Mari-
lyn.
"I'm not sure. They just don't seem to think the job or the
company is all that important Like the fellow said the other

day in the management training class, They don't relate to


the job.' I guess it's just the times, everything comes too
easy."
He pushed back and reached for his coat. As he
his chair
started for the door, his wife asked him: "What was his
name, your first boss?"
"Paul Terrace. Why?"
"Where is he now?"
"He's retired. Moved upstate after he left the company
about two years ago. He was manufacturing director when he
left. Why do you ask?"
"I was wondering if he would think everything had
just
changed. You know, I was wondering if he would think that
people couldn't 'relate' anymore."
HANDLING PROBLEMS 97

"I can answer that," smiled Elmer. "His retirement dinner


was the biggest one ever held around here. People came from
all over the country, mostly people with big jobs who had
worked for Mr. Terrace at one time or another. When he
made his speech that night, he said that people never
little

change, only situations change. He said that people always


want to do things right and that the primary tools of manage-
ment were involved with relationships, not with procedures."
He frowned. "I remember telling you that right after the din-
ner that night."
"I know," she said. "I was just wondering if you had for-
gotten it."
As he drove toward the plant that morning Elmer thought
about his wife. "I guess I know I have been given a lecture,"
he decided. "Maybe I have forgotten. But even so, what can I
do about it?"
The first task Elmer faced that morning was making out
his overtime plan for the following week. To do this he had
to determine the hours scheduled, hours worked, and units
behind schedule. The discussion with his wife was still on his
mind as he completed this routine task. Suddenly he came
upon the name of Jane Hampshire and for some reason he
stopped. Hampshire, he noted, had been absent two days the
preceding week and one day so far this week. What bothered
him was that Hampshire was one of the people he had men-
tally identified as having a growth potential. She was a hard
worker, always busy, and seemed to take a real interest in her
job. Why would she be taking off?
Elmer got up from his table and walked over to Hamp-
shire's station. "Morning Jane," he smiled. "How are things
moving along?"
"Moving pretty well this morning Mr. Currant. We had a
couple of shortages on some units, but the equipment came
along just now and we managed to catch up with the shorted
units and fix them. At least there are two cases where they
won't have to go into repair."
Hampshire returned to her task as Elmer stood staring at
her. "How," he thought, "can a person that interested in the
job take off three days out of eight?"
"Say Jane," he said, tapping her on the shoulder, "if you
can find a relief man
for a few moments, how about stepping
over here? I have something I'd like to discuss with you."
When Jane came over, Elmer asked her about her absences
and at the same time offered the comment that he didn't see
98 THE UNDERSTANDING
how a person showing such job interest could be absent so
often.
Jane smiled. "I guess I should have discussed it with you
before this, but there never seemed to be the opportunity.
You see I have been studying nights for a real estate license.
The state examining board met last week and I needed the
two days to take my tests. This week I took off to attend the
oral examinations. Of course I won't know the results for a
few days, but I think I passed."
"Does that mean you'll be leaving us?"
"Not right away, but I plan to make my career in real es-
tate and if I get the right opportunity I guess I'll have to
leave. I must say that I like it here, but I have to think of my
future."
When Jane returned to her job, Elmer began to feel that he
was getting somewhere. People wanted opportunity, that was
the secret. There was a lot of that around here, no need to go
outside. He made a note to have personnel talk with Hamp-
shire. "We probably have real estate people too," he thought.
Armed with this new knowledge he repeated the interview
with the next person on his list: Joe Thompson. Asked about
the reason for his six absences in four weeks Thompson re-
plied: "I needed a rest so I went fishing. Didn't like to leave
the job, but we have to be there when they're biting."
The next individual reported:
"My boyfriend was home from college and we went up to
see my family. We're thinking of getting married."
By this time Elmer was getting a little confused, but he
plodded on:
"I had the flu."
"Had to take the kids to the doctor. My wife works and
she can't get off."
"All this overtime we've been working wore me out. I
needed to relax."
"I had a union meeting, didn't you get notified?"
"My grandmother has been very sick."
"I went for an interview at the college to see if I could get
back in next year."
Elmer finally quit his interviews and returned to the paper
information. By a quick calculation he was able to determine
that the majority of absences occurred on Friday and Mon-
day. He figured that this was to permit extended weekends.
However, he noticed that very few people missed two Satur-
HANDLING PROBLEMS 99

days in a row. 'That must be because of the overtime," he


thought
Still searching for some hard answers, Elmer circulated
through the work area speaking to his people. He encoun-
tered a few new employees whose names he didn't remember
and reintroduced himself. But his main mission was seeking
information. He asked them questions to determine if they
knew what the schedule rate was supposed to be, to examine
their views on the importance of quality, and to see what
identification they had with the company.
Finding that most of these items were not foremost in the
minds of his people, he called the programming and quality
departments to ask if they would post status charts in the
area. It took some convincing, but that afternoon the charts
were posted and Elmer made sure that everyone understood
them:
"It's a start," he thought, "but I sure wish I knew how to
reach these people."
Although discouraged by the lack of reaction, Elmer con-
tinued his discussions for the next ten days. No significant
changes were noted, although the absenteeism did improve.
In fact the superintendent came by one day to tell Elmer that
his area had gone from the number 10 to the number 5 rat-
ing in absenteeism in only one week. He wanted to know the
cause of this improvement. Elmer couldn't tell him. The su-
per asked him to pass the information along if he ever found
out.
Somewhat encouraged but still bewildered, Elmer decided
to take a new step. He
contacted the supervisor of the area
next to his in the line and suggested that they work out a
people swap for a few days.
"I'll trade you three of my people for three of your people

for a week. Then we'll bring them back. Maybe it will help
them get a better idea of the whole job."
The other supervisor was not enthusiastic about the ex-
change, but agreed to try it if the super agreed. The super
started to question Elmer, but changed his mind and told him
to go ahead.
The
operation went smoothly. The employees seemed to
obtain a better understanding of the results of their work on
the one hand and the difficulties of total assembly on the
other. In fact, they started to volunteer for the exchanges.
Elmer's absenteeism began to drop even further, and, even
100 THE UNDERSTANDING
more remarkably, the amount of rejections decreased
dramatically. Schedule delinquencies began to disappear.
Elmer also found that his workers began to seek him out,
to discuss their problems and ambitions. Several who he had
felt were listless workers indicated their desire to enter super-
visor training, and he was able to send a few others to career
guidance discussions in personnel.
When the super invited Elmer to his office to explain the
change in his area to other managers, Elmer found it hard to
explain just what had happened. He listed all the activities he
had instigated and reviewed the results. But he could not say
which one seemed to do the job.
"It was all of them, Elmer," said the super. "I think they
are responding to the attention and the genuine interest you
have given them. We
are going to give you some support in
this area. I thinkwe have been so busy doing the job one day
at a time that we have forgotten to establish the proper rela-
tionships with our people."

CASE HISTORY QUESTIONS


1. Do you think the super's analysis of Elmer's success
was correct?
2. What support actions could be taken?

3. Do you feel such relationships are important?


4. Why did exchanging operators cause improvement?
5. Why did the actions Elmer took make people feel
more necessary?
6. What other actions do you think could be taken by
the supervisor?
Cost of Quality

Let's eavesdrop on the Management Monthly Status Review


of our favorite company. The comptroller is providing his
overview:

"Inventory increased $270,358 this month for a total of


$21,978,375.18. This is still $9981 below budget, but I
think it requires a good look because the rate of increase
is getting steeper."
"Good point," says the boss, who then directs pur-
chasing to see if they are bringing material in quicker
than needed and asks material control to give him a de-
tailed report on in-process versus finished-goods inven-
tory.
"Sales are directly on budget except for the hotel
operation, where occupancy is falling off. During the
week occupancy is running 98 percent, but this is
dragged down by the weekend rate of 35 percent"
"Hmmm," says the boss. "Marketing better get hop-
ping on putting together some weekend specials. Take
the little lady away from it all* sort of thing. Give them
a special rate and a bottle of bubbly. That should take
care of it."
"Employee compensation is overbudget. We've been
paying too much overtime in the foundry and electronic
test operations. This is caused by delinquent schedules in
the assembly group. They got 2 days late last month and
haven't been able to catch up." "Production," frowns the

101
102 THE UNDERSTANDING
boss, "hasn'tbeen paying enough attention to scheduling.
I think due to that new and expensive computer
it's all

operation. Set up a task team to find out what's wrong


and give me a daily report."

"Our quality is falling off we've had several cus-
tomer complaints."
"There's no excuse for low quality. The quality de-
partment has to get on the ball," growls the boss.
"Maybe we need a new quality manager. I want high
quality. Meeting adjourned."

Now you'll notice that everything in the above report is


quite precise, even down to the last 18 cents of inventory. All
things are measured, evaluated calmly, and dispositioned. All,
that is, except quality, which is merely "falling off." How
come company is not reported in num-
that portion of the
bers? Why is dangling in midair? Why is the quality
it left
manager suddenly considered inadequate when the other
functional managers who have troubles are not? Why wasn't
he there?
How come there wasn't a report on quality? Something like
this:

"Our receiving inspection rejection rate has climbed


from 2.5 to 4 percent in the last month. This is due to
purchase orders on standard hardware not calling out
the proper plating requirements. Printed circuit board re-
jectionshave risen from 4 to 6 percent due to untrained
assemblers being placed on the line. Production has
pulled them back for training. Customer returns have
dropped from 3 to 1.2 percent, but this has cost us $35,-
491 in overtime due to the additional testing required.
An engineering error was responsible for the defect.
Changes have been issued and the problem will be
corrected by the 18th of next month. The cost of quality
is running at 6.1 percent of sales, and we plan to meet
the year-end objective of 5.9 percent."
"Great," beams the boss. "As long as we can find
these situations early and take action, we will be able to
have confidence in our conformance. Quality is doing a
fine job."

Quality is but no one is ever going to know it, if there


free,
isn't some sort of agreed-on system of measurement. Quality
COST OF QUALITY 103

has always suffered from the lack of an obvious method of


measurement in spite of the fact that such a method was de-
veloped by General Electric in the 1950s as a tool for deter-
mining the need for corrective action on a specific product
line. I remember a case history in a course I took that com-
pared two product lines using the cost of quality as the basis
of comparison.
The quality profession, however, clings to the very man-
agement concepts that allow them to be inadequate, so cost-
of-quality measurement was never really implemented except
by a radical here and there. The first instance of using a com-
panywide quality measurement, actually calculated and re-
ported by the comptroller was probably in the ill program
we instituted in the mid-60s.
By bringing together the easily assembled costs like rework,
scrap, warranty, inspection, and test, we were able to show an
accumulation of expense that made the line management lis-
ten to us. This led us to install more sophisticated quality
management programs, which uncovered costs in areas such
as change notices, installation, and supplier in-plant oper-
ations. At present we are learning how to measure "service"
costs of quality. This applies not only to operations like insur-
ance or hotels, where there are no milling machines or
printed circuit assembly areas, but to manufacturing plants
themselves. It took a long time to get around to the realiza-
tion that half the people in the most manufacturing of manu-
facturing plants never touch the product. And of course, as
individuals we are all service people. Unless we are blood do-

nors then we are manufacturing plants.
A detailed explanation of how to use the cost of quality to
get an improvement team moving is given in Chapters 10 and
11. Here I cover some general details on the things that go
into the cost of quality (hereafter often referred to as COQ)
All you really need is enough information to show your
management that reducing the cost of quality is in fact an
opportunity to increase profits without raising sales, buying
new equipment, or hiring new people. The first step is to put
together the fully loaded costs of (1) all efforts involved in
doing work over, including clerical work; (2) all scrap; (3)
warranty (including in-plant handling of returns); (4) after-
service warranty; (5) complaint handling; (6) inspection and
test; and (7) other costs of error, such as engineering change
notices, purchasing change orders, etc. It is normal to obtain
only one-third of the real cost the first time you try it
104 THE UNDERSTANDING
Many quality management people start out with the
thought that it is a good thing for them personally if the
company has a very low figure for cost of quality. They tend
to come up with readings like 1.3 percent of sales. Then they
run to the boss for applause. A
few years later their successor
finds that it is and embarks on a
really 12.6 percent of sales
well-rewarded campaign to reduce this needless waste. The
first person just refused to understand that the cost of quality
has little to do with the operation of the quality department.
To make the total calculation more understandable to
other managements it is a good idea to relate it to a signifi-
cant base. Most people use a percent of sales. However, if
you are in a company where there are unusually high costs of
distribution like the food industry, you may want to measure
COQ as a percentage of cost of sales, or just plain manufac-
turing costs. In insurance, banks, hotels, and similar
businesses the cost of operations makes a good base. What is
really important is that the number be something that quality
management can use to communicate the importance of the
concept. That is what the whole business of COQ is all about.
Many managers wait, and fiddle, and never really do get a
workable COQ system installed. They collect endless lists and
classifications of things that should be considered. They are
too concerned with trying to obtain an exact cost figure, and
don't really understand the reason for doing the calculation
in the first place.
All this just delays the rest of their program. As I said, the
purpose of calculating COQ
is really only to get manage-
ment's attention and to provide a measurement base for
seeing how quality improvement is doing. If managers spend
all their time getting ready and attending endless conferences
searching for the secret, they will be disappointed.
Once an operation knows its COQ, or a good approxima-
tion, goals for reducing that cost can be set. Ten percent a
year is a good, attainable goal that people can relate to. As
you go along, and become more adept in determining things
that belong in the COQ, you will find the base number
growing. This means that you must go back and apply this
information to figures obtained in the past if you want apples
to look like apples.
All calculations should be produced by the accounting de-
partment; that ensures the integrity of the operation.
Naturally, they are going to ask you for a list of those costs
which must be included. The following list should be of some
COST OF QUALITY 105

help, although you will have to add any items that


are unique
at
to your business. These three categories should be
sufficient

first; don't search for additional details


until you absolutely

need them. That is what creates bureaucracy.

Prevention Costs

Prevention costs are the cost of all activities undertaken to


prevent defects in design and development, purchasing, labor,
and other aspects of beginning and creating a product or ser-
vice. Also included are those preventive and measurement ac-
are:
tions conducted during the business cycle. Specific items

Design reviews
Product qualification
Drawing checking
Engineering quality orientation
Make Certain program
Supplier evaluations
Supplier quality seminars
Specification review
Process capability studies
Tool control
Operation training
Quality orientation
Acceptance planning
Zero Defects program
Quality audits
Preventive maintenance

Appraisal Costs
These are costs incurred while conducting inspections,
tests, and other planned evaluations used to determine
whether produced hardware, software, or services conform to
their requirements. Requirements include specifications from
marketing and customer, as well as engineering documents
and information pertaining to procedures and processes. All
documents that describe the conformance of the product or
service are relevant Specific items are:

Prototype inspection and test


Production specification conformance analysis
Supplier surveillance
Receiving inspection and test
106 THE UNDERSTANDING
Product acceptance
Process control acceptance
Packaging inspection
Status measurement and reporting

Failure Costs

Failure costs are associated with things that have been


found not to conform or perform to the requirements, as well
as the evaluation, disposition, and consumer-affairs aspects of
such failures. Included are all materials and labor involved.
Occasionally a figure must be included for lost customer
credibility. Specifics are:

Consumer affairs
Redesign
Engineering change order
Purchasing change order
Corrective action costs
Rework
Scrap
Warranty
Service after service
Product liability

Once you and the comptroller have calculated the COQ for
your operation, the next step is to figure out what to do with
it. This calculation is the only key you will ever have to help

your company properly implement quality management. Seize


an opportunity and make a speech like the following:

A prudent company makes certain that its products and


services are delivered to the customer by a management
system that does not condone rework, repair, waste, or
nonconformance of any sort These are expensive prob-
lems. They must not only be detected and resolved at
the earliest moment, they must be prevented from occur-
ring at all. To give you an idea of how expensive these
problems are, let me show you some of the actual costs
we are incurring at this moment. (At this point, show
them.)
To remove these costs and to prove that quality is
free, we must implement our quality management sys-
tem to its fullest. That way we can turn what is some-
COST OF QUALITY 107

times considered a necessary evil into a profit center.


Our cost of quality is now X percent of sales. It only
needs to be Y
percent of sales. The difference is pretax
profit.
Thank you.

Used as amanagement tool for the purpose of focusing at-


tention on quality management the COQ is a positive blessing
and serves a unique purpose. Used as an accounting measure-
ment, like the calculation of nuts-and-bolts inventory, it
becomes a useless pain. When the concern becomes which
operation has come up with the most accurate figures, the
purpose of keeping the figures gets lost. It is like someone on
a tight budget keeping neat records of overspending. Make
certain you keep your eye on the true reason for the calcula-
tion. Don't get lost in statistical swamps.
8
Quality Improvement
Program

Hie most crusader to learn is that real


difficult lesson for the
improvement just plain takes a while to accomplish. The ur-
gency of the need, the obviousness of the cause, and the clar-
ity of the solution have little to do with getting things
straightened out.
That is why government programs almost always fail and
are scrapped whenever a new administration takes over. The
disappointment and disillusionment of the previous adminis-
trator are all too obvious. The administrator blames a lack of
funds, cooperation, timing, or whatever for the failure. Yet
no matter what the program was, or however well it was
directed, its success potential hinged on events entirely sep-
arate from the executive's efforts.
Quality improvement programs have similar problems. Be-
cause quality improvement sounds like such a great idea, and
because it is usually so necessary, managers often feel that
merely announcing its conception is the signal for arranging a
victory dinner.
I have yet to attend a quality meeting where someone
didn't comment to me that they had been unable to "really
reach their management," or "get the people motivated," in
order to put quality improvement over the top. They claim
that they have taken the actions any well-oriented profes-
sional would expect, and yet they are disappointed. Those
colleagues who have faithfully implemented the fourteen-step
quality improvement program worry about an inevitable
108
QUALITY IMPROVEMENT PROGRAM 109

falloff in"enthusiasm," and search for new means of keeping


the program on a high intensity level.
Each time I hear these things I am shocked. I am always
surprised that they are surprised. Why should quality be dif-
ferent from the real world? After all, the method of prevent-
ing smallpox had been discovered and tested many years
before the devastation of plagues ceased. Why wouldn't
people take the necessary steps to protect themselves from
such a painful and ugly disease? Why did they ignore the
simple and inexpensive act of vaccination in the face of abso-
lute evidence that it worked? Why do people continue to
smoke tobacco when even the tobacco companies admit it is
a clear danger? I smoked for thirty years, enjoying every
puff, before being forced to quit. Now that I am free I recog-
nize what a truly messy business smoking is and am not
tempted to return to it. But that may be hindsight. Basically,
we are slow to change because we reject newness. The world
is a complicated and unsettled place. Each individual
treasures the few things he or she can depend upon. "Perhaps
it is better to take my chances on the pox rather than go over

and let these strange people scratch me." If you think this is
old-fashioned, just consider how much difficulty the govern-
ment has had in getting people to take flu shots. Why? Well,
for one thing we know for a fact that the flu shot is going to
make us ill for a while. And we might not catch the flu even
if we don't get the shot (particularly if everyone else takes
it).
Take another example: urban redevelopment. It has cost
more money than any domestic program in the history of the
United States except defense. However, you could say that
both operations have similar effects: the subjugation of cities
and their populations. The difference is in the location of the
cities.
Obviously the goals of urban redevelopment are above
reproach. Tear out the old and inefficient and replace it with
the new and different. Create jobs in the process and improve
our way of life. Very rarely has that happened. Poor people
have been uprooted, middle-class people have fled the cities,
and the urban patterns built up by centuries of slow develop-
ment and real living have been destroyed in a few years.
Whose fault has it been? Not the politicians they really —
didn't have time to do it right because they had to get reelect-
ed or they had to spend this year's budget this year.
There is always some reason given for failure, but it is
110 THE UNDERSTANDING
rarely the real one. The real one is that you have to lead
people gently toward what they already know is right. Other-
wise they just will not cooperate. If you have any doubts, ask
those who have stamp out the "adult entertainment"
tried to
sections in cities, assuming that the population is against such
things. But the basic assumption is wrong. The population
isn't against adult entertainment. It just doesn't want it next
door. After all, nothing lives unless the people support it. It is
not the "kooks" who support such enterprises, it is real
people with real money.
The most practical way to establish your frame of refer-
ence when you decide to start an improvement program is to
put it in very personal terms. Pretend that you are a com-
pany. Presumably you know yourself well enough to know
how you will react under certain circumstances. Then an-
nounce to yourself that for your own good you must take up
a new sport. Let us say that you have selected golf. Millions
of people play the game, there are courses everywhere, and
there is probably more information available about the details
of this sport than any other. Perhaps someone has even writ-
ten a book on the fourteen steps of golf improvement
through defect prevention. In that case it is only necessary to
announce your commitment, agree upon the measurement
criteria, and go forth to meet your goals. Maybe you can
even have some banners made in order to "motivate" your-
self.
You could set up goals based on improvement, and could
reward yourself for achievement. But it is going to take a
while. There is a lot more to golf than having the equipment
and the intent. You must work hard at it, and you must stay
at the wheel for a long time, if you ever want to play a really
good game of golf.
A company quality improvement effort has a lot of the
same elements. It must be well thought out, and it must be
implemented according to a plan, over a long period of time.
It requires a "culture" change; it must become part of your
life-style. And it requires that you never relax your attention.
You have to stay at it continually.
You as a manager have an obligation to demand continual
quality improvement from your operation, whether you are in
the accounting business or a machine shop. You as a man-
ager have an obligation to provide thoughtful and imaginative
leadership. What you put out is what you get back.
It is not possible to take shortcuts in an attempt to keep
QUALITY IMPROVEMENT PROGRAM 111

from involving yourself. Everyone can tell whether or not


you are being sincere. Experiments in "job enrichment" have
shown this clearly. The technique of having one group of in-
dividuals completely assemble a car, in order to build their
pride in their work, did not noticeably improve quality, inter-
est, or productivity. The people knew they were being used.
People who have to put improvement programs of any
kind into their company always feel that others are not for it.
This is entirely normal, and reflects the natural shyness of the
organization bird. We don't really like to get out front with
too much unless we are absolutely certain it will be properly
received. But my experience has been that improvement ef-
forts, properly explained, are always received correctly. It's
the "proper explanation" that takes some effort. So in search-
ing for a way to convince the quality manager at ITT, I
came up with the Quality Management Maturity Grid. The
Grid has its own uses, as described in the previous chapters.
But in the case of the quality improvement program it is even
more important just for itself• The question you have to ask
yourself is: "What would the boss, and the rest of the man-
agers who report to him or her, have to do to convince you
that they really want a quality improvement program?" The
answer, of course, is that they would have to convince you
that they personally feel the need for improvement in the op-
eration. And that is what you use the Grid for. Send them a
copy, ask them to read it, and then go see them to discuss it.
Have each of them rate the company as they see it according
to the Grid. Don't be too heavy with them. If they think
something is Wisdom and you think it is Awakening, don't
argue too much. Just leave room for improvement
Once you have discussed all their judgments on an individ-
ual basis, you can bring them together to discuss the overall
program (which is spelled out in the case history presented in
Chapters 10 and 11, which thoroughly covers the installation
of a quality improvement program). And if anyone is reluc-
tant, you can point out that their personal evaluation showed
the need for improvement
At this time it is a good idea to move right into the basics
of quality. Help them to understand what real quality means,
emphasizing the absolutes of quality management:

• Quality means conformance, not elegance.


• There is no such thing as a quality problem.
• There is no such thing as the economics of quality; it is
112 THE UNDERSTANDING
always cheaper to do the job right the first time.
• The only performance measurement is the cost of quality.
• The only performance standard is Zero Defects.

Explain the Zero Defects concept (see Chapter 10). Have


them take the test, and leave out nothing. Answer all their
questions, and keep it all simple and untechnical. Tell them
again that quality is free.
They reallywant to believe, and they really want it to hap-
pen. But their life is one continual scene of people bringing
them plans and schemes that will help them succeed, cut
costs, fly to the moon, and a thousand other things. Like you,
they know that most things don't work like they are supposed
to work.
The main task you have at this key moment is to show
them that the program has worked for other companies and it
will work for yours, if they participate. But you also have to
help them understand that although there will be instant im-
provement as soon as you start the effort, it will be a long
while before it becomes permanent. It is hard and rewarding
work. It will bring recognition to all of them.
As for yourself, remember that the product that you are
selling, and they are buying, is quality improvement The
result of quality improvement is improved everything else,
from sales to absenteeism. But it is a result. So don't tie in a
bunch of marketing motivation activities, the blood bank, the
savings bond drive, or the annual barbeque. Keep quality im-
provement in the front of your mind each time a decision has
to be made.

THE FOURTEEN STEPS


Step One: Management Commitment
Action. Discuss the need for quality improvement with
management people, with an emphasis on the need for
defect prevention. There are plenty of movies, visual
aids, and other material available to support this com-
munication. (Do not confuse "communication" with
"motivation." The results of communication are real and
long-lasting; the results of motivation are shallow and
short-lived.) Prepare a quality policy that states that
each individual is expected to "perform exactly like the
requirement or cause the requirement to be officially
QUALITY IMPROVEMENT PROGRAM 113

changed to what we and the customer really need."


Agree that quality improvement is a practical way to
profit improvement.

Accomplishment. Helping management to recognize that


they must be personally committed to participating in
the program raises the level of visibility for quality and
ensures everyone's cooperation so long as there is some
progress.

Step Two: Quality Improvement Team


Action. Bring together representatives of each depart-
ment to form the quality improvement team. These
should be people who can speak for their department in
order to commit that operation to action. (Preferably,

the department heads should participate at least on the
first go-around.) Orient the team members as to the con-
tent and purpose of the program. Explain their role
which is to cause the necessary actions to take place in
their department and in the company.

Accomplishment. All the tools necessary to do the job


now are together in one team. It works well to appoint
one of the members as the chairman of the team for this
phase.

Step Three: Qualify Measurement

Action. It is necessary to determine the status of quality


throughout the company. Quality measurements for each
area of activity must be established where they don't ex-
ist and reviewed where they do. Quality status is re-
corded to show where improvement is possible, where
corrective action is necessary, and to document actual
improvement later on.
Nonmanufacturing measurements, which are some-
times difficult to establish, might include the following:
Accounting:
Percentage of late reports
Computer input incorrect
Errors in specific reports as audited
Data processing:
Keypunch cards thrown out for error
114 THE UNDERSTANDING
Computer downtime due to error
Reruntime
Engineering:
Change orders due to error
Drafting errors found by checkers
Late releases
Finance:
Billing errors (check accounts receivable overdues)
Payroll errors
Accounts payable deductions missed
Hotel front desk:
Guests taken to unmade rooms
Reservations not honored
Manufacturing engineering:
Process change notices due to error
Tool rework to correct design
Methods improvement
Marketing:
Contract errors
Order description errors
Plant engineering:
Time lost due to equipment failures
Callbacks on repairs
Purchasing:
Purchase order changes due to error
Late receipt of material
Rejections due to incomplete description

There are innumerable ways to measure any procedure.


The people doing the work will respond with delight to
the opportunity to identify some specific measurements
for their work. If a supervisor says her area is com-
pletely immeasurable, she can be helped by asking how
she knows who is doing the best work, how she knows
whom to keep and whom to replace.
Accomplishment. Formalizing the company measure-
ment system strengthens the inspection and test func-
tions and assures proper measurement. Getting the
paperwork and service operations involved sets the stage
for effective defect prevention where it counts. Placing
the results of measurement in highly visible charts es-
QUALITY IMPROVEMENT PROGRAM 115

tablishes the foundation of the entire quality improve-


ment program.

Step Four: Cost of Quality Evaluation

Action. Initial estimates are likely to be shaky (although


low), and so it is necessary now to get more accurate
figures. The comptroller's office must do this. They
should be provided with detailed information on what
constitutes the cost of quality. The cost of quality is not
an absolute performance measurement: it is an indica-
tion of where corrective action will be profitable for a
company. The higher the cost, the more corrective ac-
tion that needs to be taken.

Accomplishment. Having the comptroller establish the


cost of quality removes any suspected bias from the cal-
culation. More important, a measurement of quality
management performance has been established in the
company's system.

Step Five: Quality Awareness

Action. It is time now to share with employees the


measurements of what nonquality is costing. This is
done by training supervisors to orient employees, and by
providing visible evidence of the concern for quality
improvement through communication material such as
booklets, films, and posters. Don't confuse this with
some get-motivated-quick scheme. It is a sharing process,
and does not involve manipulating people. This is an im-
portant step. It may be the most important step of all.
Service and administrative people should be included
just like everybody else.

Accomplishment. The real benefit of communications is


that it gets supervisors and employees in the habit of
talking positively about quality. It aids the process of
changing, or perhaps clarifying, existing attitudes toward
quality. And it sets the basis for the corrective-action
and error-cause-removal steps.

Step Six: Corrective Action

Action. As people are encouraged to talk about their


problems, opportunities for correction come to light, in-
116 THE UNDERSTANDING
volving not just the defects found by inspection, audit,
or self-evaluation, but also less obvious problems as—

seen by the working people themselves that require at-
tention.These problems must be brought to the supervi-
sion meetings at each level. Those that cannot be
resolved are formally passed up to the next level of su-
pervision for review at their regular meeting. If a specific
functional area does not hold such meetings, the team
should take action to establish them in that department.

Accomplishment. Individuals soon see that the problems


brought to light are being faced and resolved on a regu-
lar basis. The habit of identifying problems and correct-
ing them is beginning.

Step Seven: Establish an Ad Hoc Committee for the


Zero Defects Program

Action. Three or four members of the team are selected


to investigate the Zero Defects concept and ways to im-
plement the program. The quality manager must be
clear, right from the start, that Zero Defects is not a mo-
tivation program. Its purpose is to communicate to all
employees the literal meaning of the words "zero de-
fects" and the thought that everyone should do things
right the first time. This must be transmitted to every
member of the team. In particular, the ad hoc group
should seek out ways to match the program to the com-
pany's personality.

Accomplishment. Improvement comes with each step of


the overall program. By the time ZD day is reached, as
much as a year may have gone by and the initial im-
provement will be flattening out. At that point the new
commitment to an explicit goal takes over, and the im-
provement begins again. Setting up the ad hoc commit-
tee to study and prepare the implementation ensures that
the goals of the program will be firmly supported by the
company's thought leaders.

Step Eight: Supervisor Training

Action. Aformal orientation with all levels of manage-


ment should be conducted prior to implementation of all
the steps. All managers must understand each step well
QUALITY IMPROVEMENT PROGRAM 117

enough to explain it to their people. The proof of under-


standing is the ability to explain it.

Accomplishment. Eventually all supervision will be


tuned into the program and realize its value for them-
selves. Then they will concentrate their action on the
program.

Step Nine: Zero Defects Day


Action. The establishment of ZD as the performance
standard of the company should be done in one day.
That way, everyone understands it the same way. Super-
visors should explain the program to their people, and
do something different in the facility so everyone will
recognize that it is a "new attitude" day.

Accomplishment. Making a "day" of the ZD commit-


ment provides an emphasis and a memory that will be
long-lasting.

Step Tens Goal Setting

Action. During meetings with employees each supervisor


requests that they establish the goals they would like to
strive for. Usually, there should be 30-, 60-, and 90-day
goals. All should be specific and capable of being
measured.

Accomplishment. This phase helps people learn to think


in terms of meeting goals and accomplishing specific
tasks as a team.

Step Eleven: Error Cause Removal

Action. Individuals are asked to describe any problem


that keeps them from performing error-free work on a
simple, one-page form. This is not a suggestion system.
All they have to list is the problem; the appropriate
functional group (e.g., industrial engineering) will de-
velop the answer. It is important that any problems
listed be
acknowledged quickly —within twenty-four
hours. Typical inputs might be:

• This tool is not long enough to work right with all the
parts.
118 THE UNDERSTANDING
• The sales department makes too many errors on their
order entry forms.
• We make a lot of changes in response to telephone
calls, and many of them end up having to be done all
over again.
• I don't have any place to put my pocketbook.
Accomplishment. People now know that their problems
can be heard and answered. Once employees learn to
trust this communication, the program can go on for-
ever.

Step Twelve: Recognition

Action. Award programs are established to recognize


those who meet their goals or perform outstanding acts.
It is wise not to attach relative values to the identifica-
tion of problems. Problems identified during the error-
cause-removal stage should all be treated the same way
because they are not suggestions. The prizes or awards
should not be financial. Recognition is what is impor-
tant.

Accomplishment. Genuine recognition of performance is


something people really appreciate. They will continue
to support the program whether or not they, as individu-
als, participate in the awards.

Step Thirteen: Quality Councils

Actions.The quality professionals and team chairpersons


should be brought together regularly to communicate
with each other and to determine actions necessary to
upgrade and improve the solid quality program being in-
stalled.

Accomplishment. These councils are the best source of


information on the status of programs and ideas for ac-
tion. They also bring the professionals together on a reg-
ular basis.

Step Fourteen: Do It Over Again


Action. The typical program takes a year to eighteen
months. By that time turnover and changing situations
QUALITY IMPROVEMENT PROGRAM 119

will have wiped out much of the education effort. There-


fore, it is necessary to set up a new team of representa-
tives and begin again. ZD day, for instance, should be
marked as an anniversary. Nothing more than the notifi-
cation may be necessary. Or a special lunch for all em-
ployees might be given. The point is that the program is
never over.

Accomplishment. Repetition makes the program perpet-


ual and, thus, "part of the woodwork." If quality isn't
ingrained in the organization, it will never happen.
Management Style

"Management style" may be thewrong title for what I intend


to discuss in this chapter. However, it will have to do because
"style" is a word that is often used in our culture to describe

certain subjective measures of performance.


The concept of executives needing a sort of "flair" first
came to light when Clark Gable invested his last $20 for a
"sincere" tie to impress Sidney Greenstreet in a long-ago
movie about advertising called The Hucksters. Since life re-
ally does imitate art, all the outrageous actions taken in that
film are now routine procedure. Gable got the job, and we
got the message about the need for style.
I don't mean to disparage the concept. There is a definite
advantage in knowing what you want to do, and carrying it
off with elan. It is an advantage, say, to be continually
poised under fire, to always have a ready and incisive remark,
to keep your head when all about you are losing theirs and
blaming it on you. It is an advantage, and much of it can be
learned. All that is necessary is that you understand the situa-
tion we are all in as managers —
and understand yourself.
You can try to understand yourself by going through a
checklist which I will enumerate shortly. Understanding situa-
tions requires a recognition of both the state of the times and
the responsibilities of management
Until recently the career history of successful executives
was fairly predictable. They spent the first twenty years learn-
ing the business from the ground up. They spent five or ten
years in increasingly senior jobs, learning broader and more
120
MANAGEMENT STYLE 121

complex aspects of the industry. They spent their last fifteen


years running the show, while developing better and more ef-
fective ways of tracking the beaver back to its cave. They re-
tired, and were a pain in the whatever to their successors.
All of this was possible only because there was little funda-
mental change in markets, products, methods, or concepts
I over the years. Certainly technology advanced at an alarming
rate, certainly the unions deftly separated management from
some of their choices, and certainly the vagaries of the
economy alternatively pinched and flooded the money supply.
There were these and other problems, but they had all been
written about somewhere. All had been experienced before,
in one form or another. The blueprint for coping had been
filed. At least one could know what wouldn't, or hadn't,
worked.
Each generation peers at its predecessors and remarks that
things are certainly different today. This generation can look
at itself and make the same comment. Ten years ago the
market for an American company was the United States, Eu-
rope, and a small part of Latin America. Nobody bothered
about the Middle East. Nobody thought about Africa. Econ-
omists had three charts: United States; Western Europe;
and Other.
Today the wealth of the world is slowly draining off into
part of that "other": the oil-rich Middle East. United States
companies must sell like mad in order to get some of it back.
The new investors are people whose difficult culture is being
rapidly learned by those who have property to sell. The really
big houses in Beverly Hills, the big new hotels with interna-
tional clientele, the minority interests in basic industry com-

panies all are being purchased by this new money. What
should modern management do about this?
Ten years ago, who ever heard of currency translation?
Many people still don't know what it is. But if you are in-
volved with a company that operates internationally, you
know. This accounting practice requires translating some as-
sets (debt, accounts receivable, etc.) into local currency value
each quarter.
It isn't necessary to actually sell the assets, or do anything
with real money; you just have to take that local currency fig-
ure and change it to United States currency according to the
current conversion rate. Then you drop that figure to the bot-
tom line. If it is more than it was the last quarter, you have
to declare the difference as income. If it is less, you have a
122 THE UNDERSTANDING
loss. If the United States dollar has softened as compared
with the local currency during the quarter, you have lost
profit. And there absolutely no way to control it. You can't
is
plan for it except by creating reserves. Either way, you have
lost a voice in the financial control of your company.
Employment, or just plain labor, has changed dramatically
and is continuing to do so. In the late 1940s and early 1950s,
the great concern of labor leaders was that "automation" was
going to destroy the labor force by replacing it with artificial
arms and wheels. This didn't happen. The mechanization of
assembly lines just lowered costs and increased sales. Labor
grew along with the sales.
Now, however, it is beginning to take fewer hands to pro-
duce many products. The construction of telephone switching
equipment once involved thousands of people who assembled
mechanical relays. Now the equipment is solid state. Relays
can be grown chemically. Building the product takes less
h$nd labor. The labor costs lie in testing and selecting, and
much of that is becoming automatic.
As a result of social expenses (fringe benefits, early retire-
ment plans, etc.), areas that formerly were sources for low-
cost labor, like parts of Europe and Japan, now provide only
high-cost labor. Many companies making products through-
out the world are beginning to find, to their surprise, that the
United States is their least expensive producer.
African and Middle Eastern countries are hiring Western
companies to "create" instant economies. Contracts are being
made whereby a company will build a plant, a town, and an
industry for an underdeveloped country. Local citizens will
be enticed from the fields, hills, and deserts to learn to work
in the factories, live in the towns, and grow into the new cen-
tury. (Presumably they could then save enough money to re-
tire into the desert and do what they are doing now.)
These are interesting experiments. They offer a great op-
portunity for "improving" life-styles that haven't changed for
hundreds of years. I'm not sure they will provide improved
happiness. After all, a lot of cultures have moved from farms
to industries, and the change hasn't created contentment. I
was raised in West Virginia, where the "factory town" was a
way of life. There is no way I would live in one now.
The executive's problem in understanding and utilizing the
labor force is compounded by the fact that people are not in-
terested in doing something just because they have been told
to do it. Communication has to be established and continu-
MANAGEMENT STYLE 123

ally reinforced inorder to keep employees informed and par-


ticipating.Several big corporations found to their surprise
that hard-nosed practices involving a lot of order giving just
didn't mix with young, educated workers. It isn't enough to
design a whizbang assembly operation; you have to help
people want to participate in running it.
There are no clear-cut differences among the various levels
of an organization when it comes to understanding the pur-
pose and work of the company. No one can be left out. Or-
ders sent out to be obeyed may come back with questions
that need answers. And it is the executive's responsibility to
see that answers are provided. Personnel professionals are the
least likely to give good answers to people inquiring about the
quality program. They are usually one generation behind in
their thinking. However, that is still at least one generation
ahead of most senior people.
Another significant change that requires management con-
sideration is energy. Our modern industrial society has been
built on energy, primarily from fossil fuels. Oil embargos, in-
creased prices, and transportation problems have made us fi-
nally admit that there is an end to these supplies. Someday
we are going to run out. In the meantime our total depen-
dence on these sources has done more to change the economy
of the world than anything since the Flood. I personally think
we should pay the price to buy their oil and leave ours in the
ground until we need it. That way we will have the last light.
Other sources of fuel are available. Each day the sun
transports, free, more fuel than we can possibly use. Under-
ground steam exists. I can visualize the day when individual
sources of fuel will be available for individuals. It will be like
the beginning of the computer age.
When computers first became economically available, every
company, university, and government had to have one. The
bigger the better. The idea was that every organization would
have one of those huge machines that could do everything.
Then they could rent time to other people to pay for the
machine. This created an information revolution that hasn't
quite been handled yet.
New technology now permits minicomputers to do the jobs
once handled by the giant computers. The payroll department
can have its own computer. The research people can have
one. Departmental ownership eliminates waiting, scheduling

—and empire building by people who share the unintel-
ligible language of software. And the price is coming down.
124 THE UNDERSTANDING
Soon every home can have computers tied into their tele-
phone lines and TV screens. Instant information and commu-
nication. Pay your bills by telephone. Let your eyes do the
walking.
This same pattern can emerge in the energy field. Every
home or community center can have a power source taking
energy from the sun and distributing it for use as electricity.
This means that automobiles can at least do their local travel-
ing on storage batteries, requiring gasoline only for long dis-
tances. We can survive and even grow in a world like this,
but only if we learn new management concepts.
If you put these changes together, you have managerial
headaches that you weren't taught about in business school.
You have situations for which there is no precedent. They
can be handled, but only by someone who really has a lot of
management style. We need people who are in complete con-
trol of themselves, people who are able to think creatively
and to implement their ideas at the same time, and stay loose
enough to anticipate and avoid whatever it is that is lurking
behind the next hill.

Some of that style is a function of the amount of potas-


sium concentrated in adjacent brain cells, and that is some-
thing you can't do anything about. But a great deal of it can
be learned. You can use the following ten-item management
style checklist to rate yourself as ordinary, super, or spectacu-
lar. You decide what to do with it all.
Listening Implementing
Cooperating Learning
Helping Leading
Transmitting Following
Creating Pretending

There are other important characteristics, like integrity and


compassion. Vital and fundamental facets of character, they
cannot be learned or vastly improved from without, but you
cannot succeed in the management business without them. As
a matter of fact it is difficult to think of any profession you
would want to be part of that wouldn't demand a great deal
of integrity and compassion. However, they are not style.
The purpose of examining any aspect of your management
style is to determine how to make it work for you. If you
want to accomplish what you want accomplished in this com-
plex world you have to be more up than the next person.
MANAGEMENT STYLE 125

You don't have to be unfair, or unanything. But you have to


take advantage of the assets you have.

LISTENING
When I did a promotional tour for the bookThe Art of
Getting Your Own Sweet Way (McGraw-Hill, 1972), most
interviewers were interested in the ten laws of situation man-
agement. The list provided a format that neatly fit the time
allocated for the interview. It worked out very well. I would
not be thrilled at the idea of going through all that again, but
itwas an interesting and educational opportunity. The law
everyone liked best was number ten: Nobody really listens.
We all have something to say, and we keep searching for
someone to listen to it. After all, if a pearl of wisdom drops
from your lips when no one is about, and is lost, it will have
no value.
You can pay people no greater honor than to actually ab-
sorb the content and intent of what they have to say. Not just
the superficial stringing of words together. Most of us are
able to handle that much. No, you must concentrate on what
is behind the words. Really listen into the transmitter. Is the
person in trouble? Does she want help? Is he saying one thing
and meaning another? What is really going on?
Most of us wait patiently for the speaker to finish so we
can do our own talking. If you doubt this, walk up to a fel-
low golfer and say, "I hit myself in the toe last week and
broke it." He will say, "One time I almost busted my knee."
He will not ask how your toe is until much later, if at all.
Tell a horror story about something that happened to you in
the stock market, or even in the parking lot. Your listener
will tell you another, and probably grander, tale.
In spite of this you must listen and question until you are
sure you understand the message. Frankly I have to warn you
that you will discover a whole interesting new world. Once
people find that you are willing to take the time to under-
stand them, they will take the time to arrange thoughts into
concepts that are easier to comprehend. You may even create
some listeners of your own. Then you can reach a state
where true communication takes place. You are actually
transmitting, and receiving, real meanings.
Once you have abasis for eliminating or preventing misun-
derstandings, success is at hand. Nothing is more important
than true understanding, and nothing is harder to come by.
126 THE UNDERSTANDING

COOPERATING
Being part of a team is not a natural human function; it is
learned. Participants in a contact sport, such as football,
learn quickly that the rest of the team evaluates personal
worth by evaluating a team member's determination to coop-
erate. The player must not only cause plays to be executed,
but protect others as well.
During World War II, bombers learned to fly close to-
gether so they could take advantage of multiple air defense
systems. There was no room for showboating in the air. Bas-
ketball players who take shots indiscriminately will not get
the ball very often. The hunter who scares the game will not
be invited again.
To cooperate with others in accomplishing a task is one of
our nobler achievements. It is also one of the more produc-
tive aspects of the manager with style. The whole really is
greater than the sum of its parts. Synergism really does work,
if you will let it. And the more you carry, the more they will
appreciate you.
Cooperation does not mean that you have to abandon any
personal standards. You can leave one team and join another
if yours decides to raid the treasury. Make certain that the

team is worthy of you, just as you must be worthy of the


team. Expect only the best Don't settle for less. A sure fire
way to successful cooperation is to help build a winning team
from one that is not doing well. Bring people together; return
to the basics; manage; lead. The same principles apply in
relationships with individuals.Those who are known to work
with others for a common goal become known as trustworthy
people. Trustworthy people acquire no worthy enemies as
they go about their labors. That is a great advantage.
But most of all, do not be ^cooperative. That guarantees
that you will be ignored. Ignored managers cannot cooperate
with anyone.

HELPING
Helping and cooperating are not the same. Helping in-
volves giving, without direct expectation of immediate return.
It is letting someone lean on you without getting to lean
MANAGEMENT STYLE 127

back. In cooperating you are both, together, leaning on some-


thing for mutual support.
In corporate life, helping has to do with smoothing the
road for others, whether they know you are doing it or not. It
is being available when someone needs someone; it is putting
in a good word for someone who deserves it; it is not putting
in a bad word for someone who deserves it. It is telling some-
one the awful truth, like they have bad breath. It is offering a
discrete personal loan without making a big deal out of it.
To help in a positive manner, you must be genuinely inter-
ested in people and results. You can't fake this one even if
you try because true help is truly unselfish. And, of course,
you must have the patience to wait until the individual recog-
nizes that he or she really does need assistance. Otherwise
you can cause a lot more harm than good. Help must be
carefully thought out, like a Rockefeller Foundation grant.
One interesting example of misguided aid is the way alcohol-
ics have been "helped" by their families over the years. By
being supportive, by covering up the incidents, by arranging
"second second" chances, families have encouraged the vic-
tims to become more dependent on the drug, and have actu-
ally contributed to their downfall. In the case of alcoholism or
other drug abuse, help becomes those actions that force the
individual to face up to reality.
In business life it is difficult to show your friends that the
systems they are installing are counterproductive. It is hard to
let them know that they are on the wrong path. If you are
not prepared to offer such assistance properly, you can slip
into "meddling" quickly. But if you are confident that your
efforts to help arebased on a genuine concern for the indi-
vidual, and are not to further your own ends, then the help
will be accepted.

TRANSMITTING
More is done about personal transmission, and less is ac-
complished, than any individual function I know. Speech
therapy, personality improvement courses, transcendental
meditation, body language —
these and many other activities
have been undertaken by people in the hope of improving the
way they transmit. Usually they achieve a better understand-
ing of themselves, which is what most of these activities are
all about, but they fail to improve their transmitting. They
128 THE UNDERSTANDING
don't understand or believe a fundamental truth: you have to
have something to say.
I deliberately chose the word "transmitting" for this char-
acteristic because there is much more to conveying your
thoughts than just speaking. Your clothes, your physical man-
ner, your weight, your cleanliness, and many other things
transmit a lot about you, often so clearly and loudly that the
words you choose to say may not be heard at all.
There are three basic transmission actions: writing, pre-
pared speaking, and conversation.
Writing is like putting. Short and straight is best; long and
curving is undesirable. Writing helps you bring your thoughts
together so that others can understand them. It may be that
you produce ringing phrases and memorable content; enough
to send armies marching. It may be that stonemasons con-
sider you one of their primary assets, since they are so busy
engraving your words on marble walls. More than likely,
though, you are like the rest of us and struggle continually to
make yourself understood. If you believe that, you are on the
way to improvement. Writing is the hardest of the communi-
cation arts. When you speak to an audience, you can get a
little feedback as you go along. You can detect confusion,

boredom, or drowsiness. Reading is a private act, and you


can never know if someone understands what you have writ-
ten unless that person shows evidence of having under-

stood or misunderstood. Being understood is hard work. But
if you are successful at it, you can achieve more than you
ever dreamed.
Prepared speaking is a rewarding, and at the same time
wearing, communications method. It always amuses me that a
really good speech doesn't seem prepared, and yet it takes so
long to produce one. Not preparing formally for any speech
is the biggest ego trip of all. It is a direct insult to your audi-
ence, and they always know. They are liable to march on
the stage rather than go to confront the enemy.
In the last fifteen years or so, individual audiences have be-
come quite sophisticated about what to require from those
who address them. The exposure to political campaigns on
TV, the growth of the lecture circuits, and the discussions on
talk shows have opened their eyes. For this reason alone it is
necessary that you obtain guidance early in your speaking
career. Toastmasters International is not exactly a profes-
sional organization, but it offers by far the best method of
learning how to be acceptable to an audience of real people.
MANAGEMENT STYLE 129

Professional help is advised for learning how to construct a

speech, but Toastmasters is best for building confidence and

fellowship.
Conversation is the one thing we are all certain we can
handle. It is not the best subject for many, perhaps because
they feel it requires little preparation and attention. Smart
managers listen to themselves and learn how to improve.
They learn things like how important it is to look into the
eyes of the other person; like when to touch them and when
not; like when not to be clever or funny; like when just to re-
main silent.

All these transmission factors writing, speaking, and con-

versing project a picture of you on everyone's mental wall.
What they see is what they think you are. You may feel that
you are something else, and may actually not be what is pro-
jected. But what appears to be usually is. Think of the people
you know who are objectionable to you in some way. You
probably think they are doing it on purpose. They aren't.

CREATING
There are those who feel that creative ability is a matter of
genetic structure. You either are, or aren't, creative. I suspect
that this is when it comes to pure art, and
a correct analysis
even sports activities. But in the world of management you
can learn to be creative.
You can create solutions to complicated problems by being
the only one to break that complicated problem down to its
basic causes. Once these causes are exposed, a creative solu-
tion appears —
if you can recognize it. Unfortunately, most
people give up before that.
Problem solving is an acquirable skill; many techniques
and concepts for learning it are available. The most practical
technique, however, is to go ask the people who are involved
with the problem on the front lines. Not management people,
but working people. I have made a good living for years by
walking directly to the test or inspection position and asking
what the problem really is. The operators are delighted that
someone cares about their opinion. They share with me the
fact that errors are increasing because untrained people are
being put into the areas; or that the new test equipment
hasn't been calibrated yet; or that the people are teed off at
the line manager. They'll tell it like it really is and help make
a solution obvious. Naturally you should make certain they
130 THE UNDERSTANDING
get any credit that is due, and you must absorb any disgrun-
tledness.
One other source of creativity is to expand on the ideas of
others, or to take old ideas and update them. But be sure you
pass the credit out; there will be a lot to go around.
The most important aspect of creativity for management
style is not to get into the habit of stating your lack of
creative ability. Someone might believe you. Probably less
than one-tenth of one percent of the people in the world are
truly creative, that is, able to develop an original concept
from an original thought. It is not necessary to feel left out if
you don't happen to be one of that group. They are often
misunderstood, underestimated, and mostly alone anyway.

IMPLEMENTING
The most valuable manager is one who can first create,
and then implement. So few of these exist that if you find
one you should keep it a secret. More available are those who
can implement another's concept or add their own improve-
ments to already existing methods. They are worth their
weight in Arabian oil rights. Most managers can only follow
directions (which is not a bad value in itself, although un-
imaginative), and real implementers are respected, appreci-
ated and well paid.
Every boss dreams of finding subordinates who can accept
an assignment, figure out how to do it, and then come back
with the accomplished result: A
person able to handle some-
thing like: "Get that inventory down to last year's level" or
"We need to enter the capacitor industry" or "These waiters
are too slow, get them speeded up."
Just stepping up, ferreting out the basic problems, deter-
mining a practical solution, selling everyone on it,and then
getting it done. No big deal, no special authority, no ques-
tions. Just step in thereand be Mr. or Ms. Reliable.
Quality improvement programs are like that. Many quality
management people get hung up because they want absolute

authority plus a signed commitment that everyone will co-
operate. If you could get that up front, you wouldn't need to
do any managing. You would probably also be in the wrong
place. If they could provide that, they wouldn't need you.
MANAGEMENT STYLE 131

LEARNING
It always makes me wonder when people ask, "What did
you study in college?" What difference can it make? People
don't do for a living what they learned in college anyway.
Management, unless you are in a true professional field such
as chemistry, medicine, metallurgy, and the like, is very much
a general knowledge thing. The more information you have
about everything, especially people and money, the more you
can accomplish.
Therefore it is essential to never cease learning. Taking
formal learning courses whenever possible is one sure way of
learning something. But it is more important to just read and
listen. Read everything. Read at least one magazine every day
and three or four books a month (on any subject from his-
tory to sex). Dig up several good conversations each week.
And don't get hung up on the same routine for recreation.
Keep alive and uncommitted.
It is not possible to know what you need to learn. There-
fore you have to constantly seek out new experiences and ex-
posures. Some of the new magazines, or movies, or cultures
may turn you off. But they are real. They need to be under-
stood a little, if only so you can know how to deal with them
or the effect they create. You can't shut out the parts of the
world you don't like. It helps a lot when you can relate mod-
ern actions to those of the past. Just about nothing is new,
and almost everything used to be worse.
It is also a good idea to learn a new major activity every
five years. Learn to play the organ; take up tennis or cross-
country skiing; paint. All these are stimulating and challeng-
ing; they continually exercise the learning muscles in your
head. It keeps you from becoming that person you know so
well who has a negative answer for every new idea and a lost
enthusiasm for life. That person stopped learning, probably at
about your age. But it is impossible to stop things worth
learning from happening.

LEADING
Many times leading is simply finding out where people are
going and then hopping out front to yell, "Follow me." Many
times it is not. Leaders communicate by giving understand-
132 THE UNDERSTANDING
able direction and by setting evident example. Leading means
stating objectives in"a way that is precisely understood, ensur-
ing the commitment of individuals to those objectives, defin-
ing the methods of measurement, and then providing the
impetus to get things done. It is very hard and unending
work. You have to keep everyone busy. The leader who runs
out of jobs for the led to do will soon be replaced by some-
one more interested in working hard.
You know, of course, all the conventional thoughts about
the problems of being a leader: the long hours; the agonizing
as to whether all the bombers will return; the problems of
choosing between those who are coming up and those who
are going down. You will survive such problems somehow.
The thing you may not survive is something which
destroys most leaders. That something is a continually
growing belief in their individual infallibility, the thought that
only they can see the light which is hidden from everyone
else. "Why am I the only one who knows how to do any-
thing?"
The cause of this is a constant changing of the rules on the
part of the leader. If the leader is the only one who knows
what game is being played, then the leader is obviously the
only one who can win. Very few people set arbitrary rules
deliberately. It is the natural result of a process in which they
are thinking ahead in a direction unknown to their subordi-
nates. Since the subordinates don't know the compass read-
ing, they may
be thinking equally hard in another direction.
The inevitable disclosure of the difference causes a loss of
confidence on the part of the leader. This produces hesitancy
on the part of the led and everything such hesitancy builds.
The result is a disease that paralyzes the organization.

Open-mindedness an open approach in which ideas are
floated —
and guidelines are proposed openly is the only cure.
A closed leadership does not grow. Both Napoleon and Hit-
ler, who were absolute masters of their political system, left
the same legacy. Absolute zero. Nobody picked up their po-
litical banner and carried it forward. They had completely
shut off all circulation. It was a solo show in both cases, and
their programs died with them.

FOLLOWING
It is not easy to be a good follower. Servile — yes. Obedi-
ent— easy. But good? That's difficult. A good follower has to
MANAGEMENT STYLE 133

want the same follower


results that the leader wants. The
doesn't necessarily need to have identical goals, but the desire
for the same results must exist.
A
good follower takes time to make certain that he or she
understands the intent of the boss's requests as well as the
words. Good followers do not "translate" the boss to others,
and they stick to their own areas of activity. All this is not
for the purpose of restricting effectiveness or curtailing inven-
tiveness; it is merely a requirement for reducing confusion.
Good followers, who want to expand their sphere of influ-
ence, get promoted and move into higher activities. They
don't spend their time carving a piece out of the leader's
cave. They expand into an area where there is little happen-
ing, and do it with the full understanding of the boss. Inter-
necine conflict usually accomplishes nothing, except to delay
the accumulation of divisible spoils.
The art of following should not be looked on as something
to be learned just tofulfill a temporary obligation on the way

to becoming supreme exalted rooster. You never, never get


away from being a follower. You may reach a level where
your leader is a board of directors, or you may become so
high that the only remaining leader over you is "the people."
But, as you know, the people have a way of reminding politi-
cal leaders just who runs things.
Study following. Leading will take care of itself.

PRETENDING
This is a skill There is always a time
best left undeveloped.
when you forget you are pretending to be. If you
what it is

want to be an actor, be a good one. But pretending all the


time is a terrifying management style to adopt.

SUMMARY
Listening. You can convey no greater honor than to actually
hear what someone has to say.
Cooperating. You don't just cause plays to be executed, you
protect others in the process.

Helping. Let someone lean on you without expecting to lean


back.
134 THE UNDERSTANDING
Transmitting. How you come across to others should not be
left to chance.

Creating. Original solutions are a result of hard work in


uncovering unoriginal problems.
Implementing. There comes a time when someone has to ac-
tually get the job done.

Learning. When you have an answer for everything, you


know you have stopped learning.
Leading. Leaders start to fail when they begin to believe their
own material.

Following. You never reach the stage when you aren't work-
ing for someone, so learn to be good at it.

Pretending. If you're going to be an actor, be a good one, but


stay out of management

MANAGEMENT STYLE:
BALLET OR HOCKEY?
Your management should be both natural and delib-
style
erate. A the most highly desirable and useful.
natural style is

However, you may possess a few natural characteristics that


are neither lovable nor useful. Identify them and get rid of
them. But most of all, prepare. Be ready when the big oppor-
tunity comes. Know what you would say if Walter Cronkite
stuck a microphone in your face and said, "What would you
do?"
Consider the difference between ballet and hockey.
Hockey is a game
requiring the instant application of
learned and natural skills to an ever-changing situation. The
puck is dropped, and an original event begins. Action contin-
ues until a score is made, the game ends, or a whistle blows.
The player must know when to be aggressive, and when to
pull back. There is no script; there is no respite. Only action,
force, and player against player. Hockey is an exciting sport,
and its style is exciting. But it is not a good management
style.
A ballet is deliberately designed, discussed, planned, exam-
ined, and programmed in detail before it is performed. The
placing of each prop, the timing of each movement, the dis-
closure of the plot, the beat of the music all are carefully —
thought through and planned to the last detail. Yet because
MANAGEMENT STYLE 135

of the creativity of the artists and the orientation of the audi-


ence, each performance is an original. Ballet is a communica-
tions medium. It is also a practical and effective management
style.
Suppose that an organization discovers that many of the
current problems it suffers are being caused by new employ-
ees who are not being properly trained before being put to
work. Obviously the organization is going to have to require
that the operating departments be more careful about training
in the future. Armed with the assignment to correct this situ-
ation, Hockey writes a memo for the general manager to sign
stating in no uncertain terms that "in the future employees
will be assigned to perform actual work only after their skills
have been verified by the quality department." The result i9
several days of hurt feelings, conflict, and ultimatums, and
perhaps the hiring of several people to "approve skills."
Ballet, on the other hand, asks the affected departments to
meet to discuss the subject. Showing the evidence clearly and
unemotionally, Ballet helps the group reach the decision that
"we haven't been training the new employees properly prior
to releasing them to the operations." After a discussion, those
involved agree on a more controlled discipline. The quality
department is asked to monitor progress on a regular basis,
and the problem team meets regularly until the problem is
resolved. Ballet has let these departments know that the jig is
up; they are going to have to do what they should have been
doing in the first place. No fuss, no feathers flying. Just posi-
tive and productive results.
If you are able to consider the situation and work out a
i
specific way of ending a specific problem, you will be respect-
ed. If you flail about, squashing the problem while damaging
the walls and spectators, you will be classified as dangerous.
Hockey receives frantic telephone calls, memos, visits, in-
quiries, attacks,and continuous activity. Short vacations, ab-
breviated trips, and long hours are normal for the
hockey-type manager. There is the satisfaction of having ap-
proached and resolved many problems, but most of them
have to be "solved" anew each time they occur. The ballet
school of management receives few unplanned interruptions.
Goals are met regularly, vacations go as planned, and over-
time is not part of the vocabulary. Problems that do arise are

put right quickly with the competence of a British nanny.
Hockey is detection; ballet is prevention. Both styles are
possible within the conventional framework of quality man-
136 THE UNDERSTANDING
agement. But only prevention brings you the rewards and sat-
isfaction you deserve. Top management wants their quality
function to prevent problems entirely. It wants problems that
do erupt to be dealt with at once, without emotion, turmoil,
or expense. It is not interested in continually having papers
thrust under the imperial nose to be signed as evidence of
"support." They want quality made certain. So must you.
Quality is free. But it is not a gift.
Pari Two
THE DOING:
The HPA
Corporation Quality
Improvement
Program

The biggest problem managers face comes when they are ac-
tually expected to accomplish all the things they have been
saying could be accomplished if only everybody would listen
to them. They must put action where their ideas have been.
But it always comes out right if they take the time to learn
from the experience of others. In all the hundreds of quality
improvement programs I have witnessed over the years, I
have never seen an unsuccessful one when the operation fol-
lowed the fourteen steps—even vaguely. The HPA
case leads
you through a example that shows how to set up and
real-life
implement a quality improvement operation. You may recog-
nize some of the management types in the story. You will
certainly recognize the attitudes. You will be pleased to know
that it all turns out all right.
Thecase has been conducted as a teaching aid with
Lany diverse groups of managers and professionals from ev-
>ry persuasion. Acting out the roles and discussing the vari-
ous steps, they have learned in advance how to handle
situations. As a result they have gone back to their company,
Lplemented the program, and become big heroes.
138 THE DOING
All the attitude tests, all the discussions, and all the
meetings necessary are contained in the case. Part Three con-
tains the instructor's guide. I suggest you read the case
through first, examine the guide, and then read the case over
again, asking yourself the questions in the guide.
The case history is supposed to be fun to read and ac-
complish. Think of your own company after you have read it
once. Then move out. Quality improvement is waiting for
you.
And now on with our tale. • .
10
History of the Project

PERSONNEL INVOLVED
Hugh Gibbon —Vice President and gen-
eral manager, HPA Appliance Divi-
sion
Sally Gibbon —His wife — (not employed
by HPA)

Will Ellis Director, manufacturing

Otto Meyer Manager, purchasing

Harry Williams Director, engineering
Ralph Lowell—Manager, field service
Katherine Norton— marketing
Director,
Allen Fielding—Director, quality
Dr. Marian Nelson—Manager, personnel
and industrial relations
Alice Wagner—Comptroller
BillRanson—Program administrator
Sharon Ranson—His wife (not employed
by HPA)
John Halden—Quality engineer, HPA
corporate headquarters
Tom Wilson— union
President,
(Various employees and family members)

Hugh Gibbon, vice president and general manager of the


HPA Corporation Applicance Division for three years, had
been dragging the old-line manufacturer and distributor of
small appliances toward a breakthrough in its traditionally

139
140 THE DOING
thin border of profitability. He had instituted modern man-
agement approaches, and felt the division would soon reach
the point where it might make some real money. Somehow it
just never seemed to happen. There was always a brightly
unique problem emerging from what had formerly appeared
to be brightly polished woodwork.
Two years ago it was the sudden discovery that the com-
ponents being used in the personal TV line had been mysteri-
ously "downgraded," resulting in an accelerated early failure
rate in the field. This brought the field service manager,
Ralph Lowell, screaming into Hugh's office. Ralph had barely
finished pleading for an additional thirty-five people to handle
the problem when the marketing manager crashed aboard.
Katie Norton usually swept more than crashed, but anger
evaporates poise. "Dealers are suspicious of us now," she
stated, "and we better get going on our quality, or we are in
big, big trouble."
The quality manager, Allen Fielding, had reacted to the
problem by immediately calling the marginal components out
of the stockroom and installing corrective action with pur-
chasing. He was sure it wouldn't happen again. In addition,
his quality engineer had written a new repair manual for the
field people that simplified the repair jobs. It could have been
worse, they agreed.
Six or seven months after that, another bubble popped to
the surface. This one concerned a sudden accumulation of
finished goods inventory in toasters and table broilers. Ex-
haustive investigation by the manufacturing manager, Will
Ellis, showed that two separate errors in the production con-
trol computer program had caused the erroneous production
of these units. Marketing had to move them out somehow,

and they did at a significant loss.
Small fires burned brightly, were stamped out, and then
reappeared again in some other part of the operation. Staff
meetings became recrimination sessions. Everyone was to
blame but no one was responsible.
Productivity was dropping, and rejections were slowly ris-
ing throughout the operation. The salespeople were "down"
on the product Being emotional souls anyway, they reacted
to the specific problems they had seen and magnified them to
perhaps something bigger than real life. There was no deny-
ing that the salespeople were really unhappy, and it was be-
ginning to show. "No unhappier than me," thought Hugh.
Dealers were also reacting negatively. HPA sold through
HISTORY OF THE PROJECT 141

owned hardware and appliance stores, and thus


individually
depended on the goodwill of these independent dealers. Said
goodwill, in turn, revolved around the credibility and per-
formance of the product. Although HPA
maintained repair
facilities in major market areas, and a staff of field service
people, the recent problems had overwhelmed their efforts.
Thus, as the laws of mathematics require, repairs began to
fall further and further behind.
At Hugh's last staff meeting Allen, the quality manager,
presented the status of current corrective action programs
and the overall quality status. There was an improvement in
several lines but a drop in others. All in all the situation,
while not getting worse, was not improving. Fielding ex-
pressed the view that they were beginning to get a handle
on it and perhaps would see a turnaround in the next few
months. The manufacturing people backed this statement,
and an air of optimism began to pervade the meeting. Hugh
asked tough questions about the corrective action steps being
taken. He satisfied himself that the teams Al had set up were
beaming in on the right aspects of the problems. He received
the impression from all the staff that this was the right thing
to do.
As a result of this analysis, Hugh decided that he should
take some positive steps. TTie annual sales meeting was
scheduled for the following week. Hugh had planned to make
his usual thoughtful speech about the future of the small ap-
pliance industry in general and HPA
in particular. But this
time, he told Kate, he would talk about quality and how the
positive actions being taken would eliminate the problems
they were suffering.
The idea was received with enthusiasm. Al put together
some charts to use in the presentation; the comptroller, Alice
Wagner, plotted some growth curves; and the speech was
written.
The salespeople really liked the speech Hugh made. It was
just the kind of reassurance they needed. Kate was happy, Al
was delighted, and Hugh was reassured. Only Ralph Lowell
was not completely sold.
Pulling Hugh aside in what was for him a quiet gesture, he
asked what Hugh intended to do about the problems. He
pointed out that all the actions being taken were to resolve
problems already existing. He emphasized that they could
have been prevented. The field manager admitted he didn't
really know what to do about it, but he felt that there must
142 THE DOING
be some way of heading the problems off at the pass before
they got into the valley and knocked off the ranchers.

That ruined the meeting for Hugh.


What really bothered him was that the whole thing was so
obvious. If you can find problems when they are little, you
can remove them with almost no effort or expense. Better
still, if you can figure out why you have them in the first

place, you can avoid the whole uncomfortable business.


Suddenly it became apparent to Hugh that his "get well"
program was totally inadequate. He would spend the rest of
his days careening from one crisis to another. There had to
be a better way. He resolved to think the situation out.
A few days later Hugh called the quality manager into the
office. After making sure they wouldn't be disturbed, Hugh
began to talk.
He said, "Al, I think we have a situation on our hands that
we have not been treating properly. Let me be sure that you
understand that I am not blaming you. You have been doing
everything I have asked you to do, and doing it very well.
The teams you set up have been clearing up our product and
service problems. And I think your status reporting is accu-
rate and useful.
"However, we have a problem that I think is up to the two
of us to solve. This problem, as I see it, is two things. First,
the whole company is oriented toward patching things up
rather than preventing. Second, I think we of the top staff
have the wrong attitude toward quality. We're trying to do
just enough to get by. Is that correct?"
Al know how to react. He privately agreed
didn't quite
with but was not sure that it represented good common
Hugh
sense to show it. Al was not a martyr at heart. So he nodded
noncomittally. Hugh, lost in his own thoughts, didn't seem to
notice. He continued while the increasingly uncomfortable
quality man wiggled.
"We have to recognize that we need a change of attitude
around here, and we need to make sure that attitude change
is positive. We need to get everyone interested in defect pre-
vention. Now, I think that is the quality manager's job to im-
plement and I think it is my job to start. How do you feel
about that?"
Al thought a moment and replied.
"Hugh, if you are talking about a quality improvement
program as I think you are, it would be a wonderful thing for
HISTORY OF THE PROJECT 143

this company and for my work in particular. Is that what you


want?"
Hugh nodded and replied, "Exactly. I want to get started
on getting people interested in doing things much better than
we have been and I'd like to do it as quickly as possible. Can
it be done?"
"Certainly it can, Hugh, certainly it can. I have been read-
ing up lately on a fourteen-step program for installing the at-
titude of defect prevention. It seems to work where it is
properly applied, and it has produced great results from what
I can read in these papers."
Hugh stood up. "Great, that's what we'll get started. Let's
get the rest of the staff in here now and tell them what we're
going to do. We can get the program moving tomorrow.
You're in charge of it. We'll motivate everyone."
Al stood too, but held up his hand to Hugh.
"Whoa, hold it a minute. That's got to be the wrong way
to begin. I think you and I need to make sure we understand
the situation, the program, and just what is involved before
we can get everyone else involved. Can I have a few more
minutes of your time?"
Hugh sat back down, looking at this quality manager with
a new view. He cocked his head, thought a moment and then
smiled. "I'm beginning to get the feeling that you are trying
to figure out a way to tell me that I'm part of the problem,
and that if I rush off on a motivation crusade I'll screw it up
even more. Right?"
To Al's consternation he blushed a little at the comment
and, having done so, realized that no reply was necessary.
Hugh sat up straight at the desk and pulled his note pad to
him.
"OK, what do we have to do? Let's start with what you
need from me. First orient me, and then give me a summary
of those fourteen steps you were talking about so I can read
over them tonight. Obviously I don't understand quality im-
provement and motivation. Elucidate please, sir."
Al thought a moment and then decided the best approach
was to let it all hang out. He leaned forward so he could look
his boss right in the eye and began.
"OK. Well Hugh, as I said, I have been studying this
business of quality improvement. While I'm at it let me make
something clear also. Until just recently I've had the wrong
idea about the whole thing. For instance, take Zero Defects. I
always thought that Zero Defects was some sort of motiva-
144 THE DOING
tion concept where you were supposed to show people posters
and make a few speeches at them so they would sign a
pledge. Having done this you could sit back and let every-
thing get better. Since that is what I thought, I figured it was
just a bunch of nonprofessional foolishness. Most of the liter-
ature in the quality profession supports that belief.
"However, it became apparent to me that some companies
were having a lot of success with ZD, and that the success
was continuing over a long period of time. So I figured there
must be more to it than that. Believe me there is. is theZD
key to quality improvement, and it starts here in this office."
Hugh leaned forward. He was really interested.
"Do you mean you want to motivate me with some posters
and speeches?"
"Not hardly," smiled Al. "Not hardly. What I mean is that
we have to set a very clear standard of performance for our
people and we have to do it in a sincere way. Sincerity starts
with our commitment to it. Motivation has nothing to do
with it. Those who have used ZD programs over a period of
time say they never understood how the idea got started that
it was a motivation program. It is merely setting performance

standards that no one can misunderstand and then starting a


two-way communications exercise to let everyone know about
it. As you said before, we are all working diligently on the
wrong thing.We can work just as hard on the right." Hugh
frowned.
"We
can't afford to get everything gold plated, or give
away the whole store. If you're going to have zero defects in
everything we would have to hire 300 inspectors. The people
would get frustrated just from failing once in a while. It
sounds impractical to me."
Al tapped his finger firmly on the desk.
"It's not that way at all, Hugh. What ZD is is the attitude
of defect prevention. It means 'do the job right the first time.'
That's all. Do what you said you were going to do when you
came to work. If everyone will do that, we will be way
ahead. Most of the problems we have are just lack of atten-
tion. We as management have not insisted on things being
done right. Look, I have a short tape recording that spells out
the ZD concept as it was originally intended. After you hear
that I'll give you the list of the steps involved in getting up to
the day we have a company wide ZD program, and tell you
about the actions that follow after that to support it. Agree-
able?"
HISTORY OF THE PROJECT 145

Hugh nodded.
"That sounds good approach. But before you play
like a
the tape, let me
ask you one question. Assuming all this
makes sense to me, how soon could we begin our formal
quality improvement program?"
"Boss," grinned Al, "we have already begun.'* He went
quickly down the hall to his office, returned with the tape
recorder, and put on a tape:

The products of industry are not good enough. Customer


complaints are rising; there is too much waste. Those
products that work trouble free do so because of an in-
vestment in test, inspection, and service that is out of
proportion. Many companies spend 10, 15, and even 20
percent of their sales dollar on scrap, rework, warranty,
service, test, and inspection. The errors that produce this
waste are caused directly by the personnel of the com-
pany, both employees and management.
To eliminate this waste, to improve the operation,
to become more efficient, we must concentrate on pre-
venting the defects and errors that plague us. The defect
that is prevented doesn't need repair, examination, or ex-
planation.
The first step is to examine and adopt the attitude
of defect prevention. This attitude is called, symboli-
cally: Zero Defects. Zero Defects is a standard for man-
agement, a standard that management can convey to the
employees to help them to decide to "do the job right
the first time."
People are conditioned to believe that error is inevi-
table. We not only accept error, we anticipate it.
Whether we are designing circuits, programming a com-
puter, planning a project, soldering joints, typing letters,
completing an account ledger, or assembling com-
ponents, it does not bother us to make a few errors, and
management plans for these errors to occur. We feel
that human beings have a "built-in" error factor.
However, we do not maintain the same standard
when it comes to our personal life. If we did, we would
resign ourselves to being shortchanged now and then as
we cash our pay checks. We
would expect hospital
nurses to drop a certain percentage of all newborn ba-
bies. We would expect to go home to the wrong house
by mistake periodically. As individuals we do not toler-
146 THE DOING
ate these things. Thus we have a double standard one —
for ourselves, one for the company.
The reason for this is that the family creates a
higher performance standard for us than the company
does.
we must determine if we as management
In short,
have made our desires clear to those who look to us for
guidance and direction. We must provide an understand-
able, constant standard for quality performance.
Consider the three basic areas of performance in
any organization: cost, schedule, and quality. All these
are vital for success. Each requires the establishment of
a performance standard that cannot be misunderstood.
Take cost. Everyone understands what $2.35 looks
like. There may be some argument about what to do
with the money, but everyone understands its substance.
A budget is set, and the standard is to make the job and
the funds come out together.
Schedule also has an understandable common base:
time. We all use the same standard calendars and clocks.
Delivery and completion dates are specified in contracts
and requirements. We either meet the dates or we do
not.
Now what is the existing standard for quality?
Most people talk about an AQL—
an acceptable
quality level. An AQL
really means a commitment be-
fore we start the job to produce imperfect material. Let
me repeat, an acceptable quality level is a commitment
before we start the job that we
will produce imperfect
material. An AQL, therefore,not a management stan-
is
dard. It is a determination of the status quo. Instead of
the managers setting the standard, the operation sets the
standard.
Consider the AQL you would on the prod-
establish
uct you buy. Would you accept an automobile that you
knew in advance was 15 percent defective? 5 percent? 1
percent? Vz of 1 percent? How about the nurses that care
for newborn babies? Would an AQL
of 3 percent on
mishandling be too rigid?
The Zero Defects concept is based on the fact that
mistakes are caused by two things: lack of knowledge
and lack of attention.
Lack of knowledge can be measured and attacked
by tried and true means. But lack of attention is a state
HISTORY OF THE PROJECT 147

of mind. It is an attitude problem that must be changed


by the individual.
When presented with the challenge to do this, and
the encouragement to attempt it, the individual will re-
spond enthusiastically. Remember that Zero Defects is
not a motivation method, it is a performance standard.
And it is not just for production people, it is for every-
one. Some of the biggest gains occur in the nonproduo
tion areas.
The Zero Defects program must be personally
directed by top management. People receive their stan-
dards from their leaders. They perform to the require-
ments given to them. They must be told that your
personal standard is: Zero Defects.
To gain the benefits of Zero Defects, you must de-
cide to make a personal commitment to have improve-
ment in your operation. You must want it. The first step
is: Make the attitude of Zero Defects your personal
standard.

After the recorder switched off, Hugh sat there for a mo-
ment Then he turned to stare at Al. His voice was calm and
quiet He almost muttered. "Well, I'll be darned. If 'the prod-
uct looks like the management,* and we're having all this
trouble, then the problem or at least a large part of it must
be me and my staff. OK
Al, I think I have the message.
Leave that material with me, and come back tomorrow morn-
ing at 8:15. You and I should have a meeting at that time
each morning to go over the steps one at a time while we're
laying out the program."
•'See you in the morning."
(The material Hugh took home with him was titled "Qual-
ity Improvement through Defect Prevention." The program
contained the fourteen steps that should be familiar to you by
now, steps which were outlined in Chapter 8.)
Talking to his wife, Hugh commented on the program and
the problem.
"This program sequence certainly sounds logical, and the
experience reported by these other companies is realistic and
well documented. But the whole thing still bothers me. It
seems like the program isn't, well, I don't know exactly what
J
it isn't"
"I know what it isn't," remarked his wife. Hugh looked up
in surprise and amusement
148 THE DOING
"How could you know? You haven't even seen it."
"I know you. The problem you have is that the program
doesn't look complicated enough to accomplish all those
things, in fact it looks like something you should have
thought up yourself. Isn't that correct, oh mighty industrial
tycoon?"
Hugh had to admit to himself, and eventually to Sally, that
the simplicity and directness of it bothered him. Make a com-
mitment to a standard, communicate it, recognize per-
formance, and then recycle. And be honest about it
The commitment part was what really bothered him. He
guessed his feelings were hurt. As a dynamic and interested
manager he felt that he had always given his people the chal-
lenge to do the job right the first time. He thought that he
had always demanded top performance. But in honest retro-
spect he realized that in his intensity to deliver on schedule,
meet the budgets, and keep a smooth operation, he had let
things get off course.
Just six weeks ago he had raised Cain with the final test
people for delaying acceptance testing on some rotisseries
while their equipment was calibrated. He thought at the time
that he had been punishing them for lack of foresight. Now
he realized that he had been telling them that testing wasn't
important.
Anyway he had to settle down and accept the task of re-
ally making it clear to his people that he was serious about
quality. He would do that when the program formally
started. Sighing a he turned to the booklet, determined
little,
to do the damn thing one step at a time if that was what it
took to get the outfit moving again*
11

The Program

STY*!?!* ON"F*
MANAGEMENT COMMITMENT
Purpose: To make it clear where management stands
on quality.

It isnecessary that we consistently produce conforming


products and services at the optimum price. The device
to accomplish this is the use of defect prevention tech-
niques in our operating departments: engineering, manu-
facturing, quality control, purchasing, sales, and others.
No one is exempt.
It is much less expensive to prevent errors than to
rework, scrap, or service them. The expense of waste
can run as much as 15 to 25 percent of sales, and does
in some companies.
The first action that must take place in improve-
ment is that the management of the company must take
a moment to understand what is needed, and make the
decision themselves that they indeed want to improve.
This decision is made when they decide to adopt the atti-
tude of defect prevention as their personal standard.
The reason that this is important is obvious but
bears repeating. It is a matter of the quality policy.
The quality policy of an oragnization is too impor-
tant to be left to those responsible for the acceptance of
the product. The quality manager, or the inspector,
149
150 THE DOING
asked to judge continuously whether the product is good
enough or not, will bias the product or service according
to his or her own background and personal attitudes.
What is the quality policy?
of mind held by the company person-
It is the state
nel concerning how well they must do their jobs. It is
this policy, whether it has been stated or not, that deter-
mines in advance how successfully the next job will be
done.
If a formal policy is not established by the manage-
ment of the organization, then the personnel will select
their own — individually. This policy must be stated and
established by the top executives of the organization,
much in the same manner as the financial policy. To
delegate this function to the quality manager, or other
vertically oriented executives, is dangerous.
To determine what this policy should be, we should
first examine some things it should not be:

1. It should not be a treatise on the "economics of qual-


ity." Quality means conformance. There is no such
thing as the economics of conformance; it is always
cheaper to do the job properly. There are economic
levels of inspection, testing, laboratory equipment,
secretaries, food servings, and other functions, but
there is no economics of quality.

2. The quality policy should not have a number in it


Stating allowable nonconformance is no way to get
what you want because no one notices the number
for what it is. They just know it is there and allow
for it.

3. It should not indicate any method of deviating from


the policy. If it does, immediately there will be a pro-
cedure written on that method, and meetings will be
held to train people extensively in the procedure—to
the reduction of the original intent.

4. It should not delegate the responsibility for evaluating


performance to the policy. This must be the preroga-
tive of the chief executive, even though the executive
will have others gather the information.

5. The policy should not be hidden in a book reserved


for executive personnel only. It should be stated,
THE PROGRAM 151

restated,and publicized until everyone knows, under-


stands, and believes it.

The policy statement recommended is: Perform exactly


like the requirement . . . or cause the requirement to be
officially changed to what we and our customers really
need.
The statement of this policy, and its explanation to
the management team, will properly set the stage for
quality improvement.

Comment: It is vital that each member of operating


management understand and agree with this policy, and

more important implement it

Hugh turned to his desk and wrote the policy as it was


stated. He toyed for a moment with adding a comment like
"if you have any questions, consult your supervisor" but de-
cided that this would just reopen the gate. If you were going
to stick to the published requirements, then you were going to
stick to them. It might be interesting to find out whether or
not the products could be made to what he and others
thought they ought to be.
He did add that this policy applied to all employees of the
company and would be enforced not only in the manufactur-
ing operations, but everywhere. That, he thought, ought to
get the marketing types going.
Promptly at 8: 15 Al Fielding walked into the general man-
ager's office. Hugh handed him the proposed policy state-
ment Al read it several times, smiled, and handed it back.
"Short and to the point, Hugh. 'Do what you're supposed
to do,' that's the way it has to be."
"Good, I'll have it issued today and we'll at least be past
step 1. However, I think it would be a good idea if we told
the staff why we're doing it. How about setting up a meeting
for 3 o'clock this afternoon, and we'll go over the whole
thing?"
"No problem," said Al.
"Now, my we have to come to
friendly quality manager,
grips with the rest of this program. You have already begun
step 13, quality councils, so we don't have to worry about it
at this time. How's going, by the way?"
it
"Very well. Thebiggest problem I'm having is that they're
not really sure yet that we're serious about the whole thing. I
think this policy will help in that line."
152 THE DOING
"Boy, have we lost that much credibility? Perhaps it would
be a good idea if I met with them. Can we arrange it?"
"We're having a meeting next Wednesday after work. Sup-
pose I make it a dinner instead. You can come and say a few
— —
words, and then if you don't mind let's just open it up and
let them ask any questions they want."
Hugh obviously liked that idea.
"If it works maybe we should do the same thing with
out,
the other departments. Now, the next step in this program is
number 2: quality improvement team. You should be the
chairman, shouldn't you?"
"I don't think so, Hugh," replied Al. "If you read the in-
structions, they don't specifically recommend the quality man-
ager. I think if it was that obvious, they would have done so.
My feeling is that if you make the quality manager responsi-
c
ble for the program, it becomes just another quality drive' to

most people."
"bK. Well, let's read the concept of the step a word at a
time and see if we can figure it out. Apparently the choice is
up to us, because we need to find the person in our organiza-
tion who can be the most effective strictly from a quality im-
provement standpoint."

STEP TWO:
THE QUALITY IMPROVEMENT TEAM
Purpose: To run the quality improvement program.
Since every function of an operation is a contributor to
defect levels, every portion must participate in the qual-
ity improvement effort. The degree of participation is
best determined by the particular situation that exists.
However, everyone has the opportunity to improve.
The quality improvement team is strictly a part-
time job for the members except the chairperson, who
will become rather deeply involved. Therefore, the selec-
tion of the chairperson is an important step. There are
really only two requirements:

1. The chairperson should be a mature member of man-


agement who understands the need to improve and
agrees with the concept of Zero Defects and defect
prevention.

2. The general manager and the manager's staff must


have confidence in the person chosen.
THE PROGRAM 153

No special skills Some companies


are involved.
have manager,
selected their quality and some have used
executives from industrial relations, manufacturing, en-
gineering, or finance.
The chairperson should assemble a team represent-
ing each department, and together they should examine
the purpose of the program and the concepts involved*
Then this group runs the program.
The responsibilities of the members are:
1. Lay out the entire quality improvement program.
2. Represent their department on the team.
3. Represent the team to their department.
4. Cause the decisions of the team to be executed in
theirdepartment
5. Contribute creatively to the implementation of the
improvement activity.

Although the team has the responsibility of creating


and directing the program, it must be stated emphati-
cally that the individual departments are held responsible
for developing their own programs and causing them to
occur.
The team should develop its plan and then present
itto the general manager and the general manager's staff
for acceptance and support. Firm dates should be set for
each step's accomplishment, and progress should be re-
viewed at each staff meeting. This constant emphasis will
ensure success.

Comment: The establishment of this team and the or-


ganization of the improvement program does not
represent an additional expense for the operation. It is
really pulling together and organizing things that are
happening in one form or another at the present time.
By formalizing it and centralizing the effort, it is possible
to eliminate duplication of effort

•That's not one whole hell of a lot of help as far as picking


the person goes," muttered Hugh.
Al scratched "Maybe we missed it, but it seems to
his chin.
me that they'd make a
big deal out of which function should
organize the project. They don't even give you an organiza-
tion chart or a time schedule, except to say that the initial
154 THE DOING
program should cover a year and the steps should be staged
to occur when you're ready for them. It seems to me that
we're left to decide who would care the most about it."
"By George, I think you've got it," said Hugh.
"Huh?"
"Who is hurting the most in this whole quality thing? Me,
of course, because if we don't produce I'm out, and you, be-
cause you're supposed to be in charge of it according to the
organization chart. All true. But the one who is really hurting
is our intrepid marketing department. They are actually em-
barrassed at the junk we're putting out. Kate is dying inch by
inch and she knows it. She is the chairman, or is it chairper-
son?"
"Chairwoman?"
"How about team leader?"
"Leaderette?'
"Seriously, Kate would be the logical choice. She is experi-
enced in the business, she's tough, and she has high personal
standards. In addition, everyone respects her personally and
professionally."
"I don't think she'll take it. She feels, I think, that the fac-
tory is the only problem. She won't be willing to have an im-
provement program in marketing. Let alone run the whole
thing."
"Sure she will. You just don't understand marketing
people. She thinks she has the most efficient operations in the
whole company; therefore, she will accept the assignment in
order to bring the rest of the place up to their concept of per-
formance."
"You're probably right. Anyway, I agree with the idea of
trying it. How about Bill Ranson as the administrator of the
program? He is young, very bright, good with people, and has
been going to Toastmasters. I think he would like the chance
to show you and the other members of the staff what he can
do."
"OK. Let's invite the meeting today. He might as
him to
well be in on the whole thing from the start."
Hugh went back to his work and Al set off to arrange the
staff meeting.
Al introduced Bill Ranson to the staff as each person ar-
rived, explaining that Bill was going to be the administrator
of the new quality improvement program. Everybody was
friendly, but you could tell that it didn't register that they
were going to have to do something personally in this new
THE PROGRAM 155

program. Ralph and Kate both, as a matter of fact, made


comments about how Bill should feel free to call them if he
needed any information about the problems in the factory.
Hugh started the meeting about 3:15.
Tm glad you could get here this afternoon on such short
notice. What I have to say is very important to all of us, and
involves the business of establishing a formal quality im-
provement program for HPA. Let me briefly run down our
situation.
"We are in command of a company that manufactures
small appliances and provides service for privately owned
hardware and variety stores. We find ourselves in a market
that is expanding, while our share is shrinking. Two years ago
our sales were $55 million; last year they were $56 million;
this year sales should come out to $54,360,000. That's as flat
as you can get. Our profit this year will be $815,400, which is
1.5 percent return on sales. Return on assets is 1.7 percent
When you figure the investment opportunities available today,
it is apparent you could do a lot better with your money than

putitinHPA.
"The very clear situation we face is that we have to im-
prove our income and we have to do it without raising prices.
In addition we need to increase sales so we have a broader
base.
"Now take a look at where the
let's money goes —the
$54,360,000 we receive from all sales:

Compensation to employees $26,092,800


Suppliers of materials and services, etc. 25,971,800
Federal, state, and local taxes 1,480,000
Income 815,400
Total $54,360,000

"I know that is an unusual way to look at a company's fi-


nancial breakdown, but I think it does indicate that we either
have to restructure the company to the level that will give us
8 percent after tax on a smaller volume of product, or we
have to reduce costs internally and improve our quality
enough to let us obtain a better gross margin in the market-
place.
"We have a of 2718 employees. I asked Marian Nel-
total
son to provide you with a breakdown of their distribution in
the company."
156 THE DOING
Nelson rose and walked around the table, handing each at-
tendee the following list of personnel assignments:

Marketing 136
Field service 281
Management staff 65
Quality 187
Design 92
Purchasing 16
Manufacturing 1825
Personnel and industrial relations 52
Comptroller 64
Total 2718

Hugh let everyone absorb the information and continued:


"While we have multiple problems involving the products
themselves, we also have a frightening tendency to do jobs
over in the administrative and paperwork areas. Al ran some
special analyses for me, and they tell some interesting stories.
It looks as though as many as 25 percent of our people are
involved in doing jobs over a second or even third time. In-
cidentally, that doesn't seem to be unusual in industry."
There was a collective gasp in the room.
Kate shook her head. "Hugh, I have a hard time believing
that Do you mean that my
salespeople are saying the wrong
things to customers or taking the wrong orders or going back
to the wrong places or what? That is a serious accusation."
Hugh seemed a little startled.
"Kate," he said in a quiet tone, "it is not an 'accusation.' It
is a comment based on the information that I have been able
to put together very quickly. But I can give you an example.
We have an order-writing group consisting of two people who
are part of your operation."
"Right," said Kate. "They take the orders as they come in
and turn them into shop requests so that the inventory, shop
time, and everything else can be programmed. It saves a lot
of time and effort for the manufacturing people." She looked
to the manufacturing director for confirmation. He nodded.
"I understand the system," stated Hugh. "But we had one
of the quality engineers spend the day in the production con-
trol department seeing what happens to those orders. He re-
ported that of the eighty-seven received from order writing
last Thursday, sixteen had to be returned because of wrong
part numbers or other errors. In determining how frequently
THE PROGRAM 157

thishappens, he learned that production control has one per-


son whose full-time job is to coordinate with the order group
because of the large number of errors found in the past."
"Why wasn't I told of this?" said the now-irritated Kate.
"Because we have alousy internal communication and cor-
rective action system, that's why. That is one of the things we

have to correct. You're only a part of it the trend is all
around us. We
find in field service that the repair people
don't send in the results of their repair analysis because they
have found that no one does anything about their recommen-
dations in terms of redesign or change of manufacturing
process. They even have informal manuals on how to fix all
the known problems."
Ralph Lowell flushed. "We've tried to get people interested
in these reports, but it is very hard."
Harry Williams, the chief engineer, turned in his chair.
"We used to look at the reports, but most of them are the
fourth carbon or some other hard-to-read material. Besides,
we really don't have the personnel to search through them."
Will Ellis, from manufacturing, cleared his throat. When
silence was obtained, he commented, "My rejection rates
have been steadily increasing over the last three years. I at-
tribute a lot of that to the turnover in people we've had and
to lack of proper training. But I think saying that 25 percent
of them have to do things over full time is a little exagger-
ated."
"Might be, Will, might be," nodded Hugh. "But we're go-
ing to find out and we're going to fix it. Before we start talk-
ing about the program in detail, let's assume for one moment
that the guess is right —
that one-fourth of our people are not
productive in the true sense of the word. That is 6.5 million
bucks we are paying in our own house to do things over.
That is a target worth shooting for."
"You know, Hugh," said Otto Meyer, the purchasing man-
ager, "if you project that same thought to our suppliers, and
figure that about half of what we pay them is for labor, that
is another $6.5 million. Altogether we could have a $13 mil-

lion dollar target if we did it right"

•That's the message, Otto."


"It sounds a little dreamy to me," remarked Kate. "How's
all of this going to help my problem with the quality of the
product?"
"I think it would be better if we took some time now to
158 THE DOING
examine the proposed quality improvement program itself,
and to have Al and Bill give us a half hour seminar on qual-
ity. If we all understand what it is and isn't, we'll be in better
shape to decide our actions for the next few weeks. Al, go
ahead. Kate, I think you'll get your answer out of this."
Kate didn't look too convinced.
Al stood at the front of the room and began. "It is difficult
to talk about quality because everyone has his or her (Kate
smiled finally) ideas on what it is. So I'm going to give you a
self-grading test to serve as an agenda. After that we'll review
the absolutes of quality.
"We can have a more meaningful discussion once we are
through this period. Bill, would you please hand out the ques-
tions? They are all true or false. Circle your answers and
keep the sheet."
Bill passed around the ten-question test.

1. Quality a measure of goodness of the product that


is
can be defined in ranges such as fair, good, excel-
lent F T
2. The economics of quality requires that management
establish acceptable quality levels as performance
standards. T F
3. The cost of quality is the expense of doing things
wrong. T F
4. Inspection and should report to man-
test operations
ufacturing so they can have the tools to do the jobs.
T F
5. Quality is the responsibility of the quality depart-
ment. T F
6. Worker attitudes are the primary cause of defects.
T F
have trend charts that show me the rejection levels
7. I
key operation.
at every T F
8. I have a list of my ten biggest quality problems. T F
9. Zero Defects is a worker motivation program. T F
10. The biggest problem today is that the customer
doesn't understand our problems. T F
(Answers begin on Page 232)

One by one the staff members completed their marking, laid


down their pencils, and looked expectantly at Bill. (It is inter-
esting, by the way, to watch how aggressive, successful man-
THE PROGRAM 159

agers react to being tested. Without conscious thought, they


go eagerly to their classes. Having been excellers all their
lives, they are used to achieving high grades, and they are
usually not afraid of tests. However, once in a while they run
into a test that is "tilted" a little in order to gain their atten-
tion. The questionnaire Bill handed out was that kind of
test.)
When everyone was obviously finished, Al went to the
blackboard where he wrote the numbers 1 through 10 in ver-
tical order.
Lowell gave a kind of well-controlled growl and asked Al,
"Do we really have to go through all of this, Al? We've all
been in the business for some years. We know all these
things. Let's start talking about some of our real problems."
Al reflected for a moment.
"OK, Ralph, I'll make a deal with you. If everyone got
number 1 right we'll forget the rest of the exercise. How
many wrote answer?"
'true' as their
Four hands were raised. Marian, one of the hands, smiled
the quiet smile of superiority for a brief moment until she be-
gan to realize that "true" may not have been the proper re-
sponse.
"Are you setting us up?" she demanded. "I've always used
the wordquality as an indication of worth, or, as you put it,
'goodness.' What's wrong with that?"
"Nothing is wrong with it in a literary sense nothing. The —
problem comes when you have to measure it or make a living
controlling it. We start confusing quality with elegance,
brightness, weight, and other subjective things. Then even
those get compared when we talk about good quality, bad
quality, high and low quality, and all those things. So far to-
day we've used the word quality fifteen or twenty times, and
each meaning has been different. If we're going to have a
quality improvement program, we have to agree on what the
word means. We don't want an elegance improvement pro-
gram, do we?"
As Al spoke, Hugh began handing out the policy he had
written.
"Look at the policy that Hugh issuing to each of you. It
is
states that we will perform exactly like the requirement. That
means we should conform to the requirement. Conformance
is what quality needs to mean to us. We have conformance

and nonconformance. If we want something more elegant or


less elegant, or heavier or more powerful, or whatever, we
160 THE DOING
have to make our specifications clear. We have highly edu-
cated people involved in this company. We should be able to
identify some requirements more clearly than by saying we
want 'good' quality."
Kate pointed her pencil at the quality manager.
"How about our customers? Do you plan that we don't
talk to themunless they learn to look at quality as conform-
ing to the requirements only? They talk about quality all
the time and they mean it as goodness."
*'We don't have to insist that they follow our rules, but I
think they would be happy to learn that we are dedicating
ourselves to making the product like it says it is supposed to
be in the literature we give them. They could certainly "count
on that"
Also, we can get them to tell us more specifically the things
they like and don't like about our products. Then the en-
gineering people can make changes for improvement."
Kate smiled. "It would be a pleasant change to be able to
guarantee that our product will always look exactly like the
specifications."
"You can't go around guaranteeing that," said Will Ellis.
"It would require us to spend millions of dollars on inspec-
tion and testing. Why, we'd be wrapping a $20 bill around
every toaster we sent out of here."
Hugh look puzzled.
"How do you mean that, Will? I thought we were inter-
ested in preventing defects rather than culling them out."
"Sure you can prevent errors, Hugh, but there are bound
to be a certain amount getting through. How do we keep the
customers from getting those?"
"I agree," stated Ralph. "Every day we see the same prob-
lems over and over again. It has always been that way and it
probably will continue until I get my gold watch."
"Conforming gold watch," noted Otto Meyer.
Al nodded patiently. "I think this brings us to the next
question. The economics of quality requires that management
establish acceptable quality levels as performance standards.
That, of course is false."
Alice Wagner, the comptroller, spoke for the first time.
"I didn't answer this one, Al, because I didn't understand
exactly what an 'acceptable quality level' is. Are we talking
about some sort of agreement on how good, excuse me, how
conforming, things have to be?"
•That's what we're talking about, Alice. That's why the an-
THE PROGRAM 161

swer you set up a standard that says 1.5 percent of


is false. If
the product allowed to be nonconforming, then you have
is
agreed before you start that you're going to do at least that
amount incorrectly."
"But Al," said Ralph, "We know that very few things in
life get done right all the time, so why not be practical about
it? Besides, it must cost more to get the last few percentage
points correct than it did to get the first 98 percent right."
"I've heard that a lot, Al," said Hugh. "Is it true that the
last few steps of improvement or attainment cost as much as
all of the first ones?"
"It might be in some cases, I guess, Hugh, but no one has
ever been able to show me one in a factory. This issue we are
on right now is the most important part of the whole exer-
cise. We have been raised on the cliche that "nothing ever
goes right," and so we plan on failure. When we get to the
Zero Defects part, I think you might see some of the logic
that helps us banish this thought But let's talk about the
economics of quality and acceptable quality levels for a mo-
ment.
"The 'economics of quality' is based on the thought that
you can't afford to make things too good. You can't 'gold-
plate' everything. We're not talking about the matter of speci-
fying the requirement. That, for our purpose, becomes a
marketing and engineering problem. We are concerned about
conformance, and therefore we are saying, 'Is there an
economics of conformance*?
"Is it best to do something over several times, or is it more
practical to try to have it done right the first time?"
Otto interrupted, "Obviously it is less expensive to have
things done right the first time, but not necessarily more prac-
tical. That's what AQLs come in. They've been around for
years."
"True," Al replied, "but they have been misunderstood and
used incorrectly by management people. 'Acceptable quality
level' is a statistical term coming out of the methods of qual-
ity control sampling inspection. They originally had an en-
tirely different meaning from the one they have popularly
received over the years. The way they are used now, man-
agers literally agree on the output quality level of a new plant
before the first worker enters the door."
"I find that hard to believe," said Kate.
"Unfortunately, it is very true," murmured Will. "I'm be-
ginning to see what Al is driving at. It could be that the out-
162 THE DOING
put of our own plant is keyed along these lines without our
even knowing it."
"How can you establish the quality level of a plant without
even knowing it?" asked Marian. "It would seem to me to be
a deliberate act based on an analysis of the machine
tolerances, the design criteria, materials, and similar factors."
Hugh smiled. "That's what the textbooks would like you to
believe, Marian, but real life is a lot different. I don't think
any study like that has ever been completed before the plant
has been in operation for a generation. It just is not part of
real life."
"So where do these standards and AQLs come from then?"
inquired the industrial psychologist. "Are they picked from a
hat?"
"I don't think it's quite that crude," commented Will.
"Where they come from is the operation itself. One day a
line or setup begins to run at what the managers think is an
acceptable level. So they don't try to improve anymore be-
cause they believe that this step will cost as much as the first
ones and so forth. So they concentrate on not letting it get
worse. Hell, we give awards for that."
Arthur turned to Al.
"Would screw up your procedure in educating us if we
it

discussed this Zero Defects business now? I must admit that


I'm confused."
Al nodded to Bill.
"All right, play the ZD concept tape and then discuss
let's
whether ZD a worker motivation program. The answer is,
is
ZD is definitely not a motivation program."
"That's not the way I've always heard it," said Ralph. "Ev-
erything I've read uses the word 'motivation' in every par-
agraph."
"Well, listen and see if you can find that word in this
recording."
Bill played the Zero Defects tape that Al had played for
Hugh in their initial discussion (page 145).
After the tape had been played, there was complete silence;
each person was lost in private thoughts. Bill Ranson stepped
to the front of the room.
"I know what most of you are thinking," he commented.
"The reason I know is because I have just completed the
same thought process myself in the past few days. I, too,
found it hard to accept the thought that I might be part of
the problem and that I had perhaps not been thinking about
THE PROGRAM 163

this business of performance in the most useful way. Of


course, I haven't been at my job as long as most of you," ( Al
winced) "but I think I am beginning to understand why
something so obvious was not clear to me before."
Ralph Lowell interrupted him. •Think I know what you're
going to say, think you're going to say that we here es-
Bill. I
tablished the problem, we control the problem, and we are
the only ones who can fix it. Is that right?"
"Right," replied Bill. "Right in the essentials. certainly We
have to identify the specifics of the problem and cause it or
them to be fixed. The only additional aspect Iwould add is
that it really is a joint effort by all of us. If any of us don't
sincerely think itcan be done, and should be done, then it

won't happen."
Will nodded, "I agree with all of that, and I have no prob-
lem with the ZD business as you and Al have described it
But what I really need to know is how come most of what
I've read about ZD is negative in the journals, yet when I talk
with people who are doing it they are very enthusiastic."
Al stepped forward. "I can answer that. It was bothering
me also. I came to the conclusion, after a lot of discussion,
that the quality and manufacturing people misunderstood it
at first. They had the impression that it was some sort of
magic formula which you used to entice people to do good
work by giving them prizes and fun and games. Obviously,
the point was missed that the persons needing the 'motivation'
were the management, not the workers. Also, I thought it was
only for the manufacturing people; I hadn't thought about
the fact that half the people involved don't handle the prod-
uct."
Kate cleared her throat. "OK, I think confession time is
over. It should be evident to all that we need to get moving
on this thing. Al, how long does it take to install this pro-
gram?"
"If you start now, Kate, I think you would have it installed
in a few days. ZD day is probably six months from here."
"What do you mean, if / start now?" She turned to Hugh.
Hugh smiled weakly. "We were hoping that you would

head up the improvement team with Bill to provide you
with full-time help of course."
"But I don't know anything about this business," she said.
"I think we just found out that no one does," said Will. "I
think you'd do a great job. We're behind you all the way."
"What would I have to do? Before you answer that let me
164 THE DOING
ask another question. Would I get to pick my own team?"
Hugh nodded. "Absolutely," he said. "I wouldn't have it

any other way."


Kate thumped the table with enthusiasm. "OK, I agree and
I pick this team right here. All except Hugh. We'll call him if

we need him."
It was easy to tell that not everyone was ready for that as-
signment. But after a moment there were smiles all around
and nods of agreement.
Kate pointed her finger at Bill. "Bill, you have the rest of
today to get me educated. You keep all the minutes and you
keep us straight. Call a meeting of the quality improvement
team for 5:30 tomorrow evening. I'll only keep you for thirty
minutes but we'll start moving."
She turned to the industrial relations director. "Marian,
how about contacting the union president and asking him to
sit in the meeting tomorrow with us?"

Marian didn't appear to like that idea at all. "We could be


asking for trouble, Kate. I'm not sure the union wouldn't
look at this as some sort of job speedup or something. Per-
haps we should wait until our plans are more complete?"
Kate looked toward Al, who nodded support, and then to
Hugh, who smiled.
She turned back to Marian Nelson. "How about if you and
I meet with the union people tomorrow and try the whole
thing out on them?"
Marian smiled. "You smooth-talking salespersons are all
alike. How's nine o'clock?"

The Dinner
As Al and Hugh entered the quality council dinner meet-
ing,Hugh commented that if this quality improvement drive
did nothing else it was going to get him to meet more people
than he had ever met before. He also noted that the whole
program had a positive scent about it.
The quality council members were already in the room
when Al and Hugh arrived. Al had quietly arranged it this
way so his people would have the opportunity to get conver-
sation started before the big boss arrived. Fortunately for the
success of the meeting, he remembered his past. You could
spend a lot of time in a plant without meeting the brass.
Most of the people would be a little shy, and would welcome
the chance for some unpressured time before the meeting.
THE PROGRAM 165

However, Hugh handled the introductions well. He talked


with each of the twenty-three people individually until he was
sure he had established clearly in his mind what each person
did and how they felt about their job. He was privately
pleased to note that one supervisor and four of the quality
engineers were women.
What amazed him even more was that they got to pay for
their own drinks. Al had suggested that the usual quality
council format, including the Dutch bar, be continued, al-
though Hugh wanted the company to pick up the whole tab.
"It's the way we started out," commented Al. "We're used
to being on our own."
When the time came for dinner, Hugh was a little sur-
prised to see that there was no head table and that the receiv-
ing inspection supervisor, Norm Tate, opened the meeting.
Norm noted that the general manager was there that night
and that the council was honored. After dinner Hugh would
say a few words and then the meeting would be opened for
questions. "Any questions at all," he emphasized.
During dinner Hugh kept up a lively discussion with the
group at his table, which didn't include Al. He couldn't re-
frain from asking why Al hadn't opened the meeting.
"He's not the council chairman," he was told.
"Al insisted that we run the councils on the basis that the
members determine what they want to do. He gets one vote
like the rest of us. That's why we have the privilege of paying
for our own drinks. It is one right we wouldn't like giving
up."
By the time dessert was being served, both Hugh and the
council had gotten used to his being there and everyone was
comfortable. Norm settled everyone and then introduced
Hugh as the speaker for the evening. After commenting that
several department heads had met with the group in the past
and that it had all been useful, Hugh spoke.
"I'm happy to be with you tonight, not just because speak-
ers are supposed to put that in their remarks but because I
am always happy to spend some time with professionals.
"As you know, we are not in an easy business. We
have
low margins, tough customers, and complex problems of
quality. However, I guess that any general manager in the
country speaking to a group of key people would be saying
the same thing. So let me forget all that platitude business
and get right down to brass tacks.
"We are having a difficult time from a quality standpoint.
166 THE DOING
Our failure rates are too high, our field service expenses are
outrageous, the customers are losing confidence in us, and
there are no silver linings in our clouds.
"Most of you know this, and many of you have opinions
on how things should be approached or changed to get better.
But, as you also know, we must learn to do these 'get better'
things in an organized manner. So we are setting up a quality
improvement team. The members of that team, representing
each department, are the department heads. The head of the
team is Ms. Norton, the marketing director; Al Fielding is a
member, of course. In fact, he's the brains of the outfit, al-
though we don't admit it publicly. Bill Ranson will serve as
administrator, which means he will do all the work.
"Now I realize that you can say 'these are the people who
got us into this mess in the first place.' There might be some
truth in that. But they are also the ones charged with getting

us out of the mess and it can only be done with your help.
You have to tell us how to do it, you have to help execute
the actions the improvement team decides upon, and most
important you have to measure and report the results.
"While all this is happening, you have to keep on grinding
out the product, making it like the print, and insisting that
the standards be met.
"It is apparent that we, and I am the biggest culprit, have
managed to put forth the impression that we can be satisfied
with less than Zero Defects. Let me clarify my position on
that right now. With me it is Zero Defects or bust."
Hugh stopped at that point, thought a moment, and smiled
atAl.
"Gee," he said with a smile, "once you say it out loud it
isn't all that tough."
The group burst into spontaneous applause.
The rest of the meeting went smoothly. Hugh answered
questions for a half hour and then everyone left.
Al was delighted, and Norm offered Hugh the opportunity
to return anytime he wished.

The Union
Kate Norton and a nervous Marian Nelson waited in
Marian's office for the union representatives to appear. Kate
had never dealt with the union before, and really wasn't as
calm and cool as she tried to appear. However, she antici-
pated that it could only be an interesting session. Tom Wil-
son, the president, and Mark Elliott, the business manager,
THE PROGRAM 167

arrived promptly at nine o'clock and were introduced to


Kate. Tom worked in the machine shop on the one and only
screw machine. Mark spent most of his time servicing several
unions in the area and so was dressed in a business suit. He
good-naturedly told Tom
to stay on his side of the table and
not brush any grease on his new suit
After introductions Kate began to explain the proposed
quality improvement program, emphasizing how important its
success was to the future growth of HPA.
After fifteen minutes Tom held up his hand.
"Mrs. Norton, if you're asking for permission to have a
Zero Defects program, I'm sure that it is well within the
rights of management to have one. If you're asking our opin-
ion about having one, it's about tune.
"Well then, Mr. Wilson," smiled Kate, "will you help ad-
vise the quality improvement team?"
Wilson glanced at Elliott He obviously hadn't expected
this sort of approach. Mark tried to look as noncommittal as
possible. Serving on management committees was not the
thing they were encouraged to do.
Sensing Wilson's discomfort, Kate began on a new tack.
"I'm not looking for a way of getting automatic union ap-
proval on everything the team does. I would like you to parti-
cipate as an individual. Perhaps you might want to
recommend one or two other employees who should be part
of the program. This is probably the most important thing we
are up to in this company right now."
Wilson nodded. "OK, I'll check with the executive commit-
tee about working with the improvement team. There should
be no problem; they have been concerned about our quality
for a long time. You might want to ask the guards to appoint
a representative even though they don't belong to the union.
Also, although I would personally be happy to do it for free,
the contract requires that I be paid overtime when my eight
hours is over. If that's a problem, I'd be willing to go on the
second shift for a while. We'll work something out"
After the union men left, the two sat quietly for a while.
Finally Kate said, "I think I'm going to learn something out
of this business."

Bill's Problems A New Philosophy


Bill Ranson strolled out on his back porch and stared va-
cantly into the back yard he hadn't been able to mow the
previous weekend. The neighbors would soon be joshing him
168 THE DOING
about it. His yard was as neat as any other working man's in
the world. But how could he have known he was going to
wind up with a retired farmer on each side of him? Besides
that was about number 14 on his problem parade at the mo-
ment
This new assignment of being administrator for the quality
improvement team was a great opportunity for getting ex-
posed to the big brass. Gibbon had laid his huge paw over
Bill's shoulder that day and noted that it was he, Bill, who
was going to make the thing work or fail. He had specifically
told Bill to come and see him without hesitation if he felt
that things were going off track. Bill realized that things
could easily go wrong, but he had not worried after the meet-
ing. It appeared to him that everyone was approaching the
situation in a practical and honest manner.
So what was bothering him?
His wife Sharon arrived on the porch with two glasses of
beer and an offer to sit down and talk about "it"
"What do you mean 'it/ " exclaimed Bill.
"When you walk out in the middle of our favorite rerun,
and you don't go in to write something, then it is my duty as
a member of the Imperial Order of Wives to find out what's
up. After all, I used to be an engineer myself until the twins
happened along."
Bill had to grin. Her straightforwardness made their mar-
riage work. He barely had time to start brooding over a prob-
lem before she brought everything out in the open.
So he filled her in on the latest developments, with specific
emphasis on his being appointed administrator for the team.
"It sounds like the opportunity you've always wanted. A
chance to really make a difference through your personal
contribution. Is that what's bothering you, the visibility?"
Bill thought a moment. "I think that isn't my problem. I'm
ham enough to want to be out front, as you know. I think
my problem, if I have one, is that it all appears to be going
along so easily. There is no opposition, and nobody's building
roadblocks. It isn't like normal. Perhaps I'm just being a
cynic."
"No," mused Sharon, "I think you'll see all those things
happen after the newness wears off. People are still people.
However, the whole idea seems so positive, and is being car-
ried out with so little finger pointing, that I can't see where
you would get too much conflict."
Bill straightened up. "You know, Sharon, I think you may
THE PROGRAM 169

be on the verge of exposing what*s been bothering me even


though I didn't know it. Everyone thinks we are involved in a
technique rather than a concept, and that's why there is so
little of the normal conflict"
"What's the difference between a 'technique* and a
•concept'? I always thought that sort of discussion related
only to philosophy class."
Bill pulled his chair closer to his wife. "Philosophy is the
thing I mean. That's what this program is, a philosophy con-
cerned with improvement. It's getting people to do what they
should be doing anyway, and accomplishing it in an or-
ganized fashion. For instance, eating is a concept, cooking is
a technique. Love is a concept, sex is a technique. Improve-
ment is a concept, team management is a technique."
Sharon cocked her head. "So what you're saying is that
you are involved in installing a new behavior concept in the
company, but you have to pretend that all that is involved is
a technique of program management"
"That's about it. The key negative aspect is that the people
can get the idea that the system will work regardless of how
much personal effort they put in or don't put in; if that hap-
pens, I'm in trouble. That's why I have to make all this as
personal as possible.
•Take the steps of the program. We've already done man-
agement commitment and quality improvement team. We
have to move quickly into measurement We have a lot of
measurements available for the product itself, both in-plant
and out-of-plant However, I'm going to have a real problem
when it comes to measurements on areas like marketing and
finance. And how about personnel? That is going to be the
first tough test. What am I going to say when engineering
people ask me how I could possibly measure their precious
designers?"
"Why not," said Sharon, "ask them how they know who
their best people are and how they know when someone rates
a raise? If they can't answer that, then you've got a bigger
company problem than you think you have."

STEP THREE:
QUALITY MEASUREMENT
Purpose: To provide a display of current and potential
nonconformance problems in a manner that permits
objective evaluation and corrective action.
170 THE DOING

Mannfacturmg Measurement
General operation. Basic measurement data
quality
come from the inspection and which are
test reports,
broken down by operating areas of the plant. By com-
paring the rejection data with the input data, it is pos-
sible to know the rejection rates. Since most companies
have such systems, it is not necessary to go into them in
detail. It should be mentioned that unless these data are
reported properly they are useless. After all, their only
purpose is to warn management of serious situations.
They should be used to identify specific problems
needing corrective action, and they should be reported
by the quality department.
Quality measurement is only effective when it is
done in a manner that produces information people can
understand and use. Therefore, the operating and report-
ing methods should be straightforward and expressed in
terms such as "defects per unit," "percent defective,"
and so forth. In addition, defects singled out for their
frequency, or problem potential, should be classified as
to seriousness, cause, and responsibility. This eliminates
the necessity of spending time on less significant items
while more important worlds are waiting to be con-
quered. The best method of properly utilizing the in-
formation is to concentrate on two types of reporting for
each area:

1. Trend charts. These charts, posted on a weekly or


monthly basis, show the running status of the area.
Management can use them to determine if things are
getting better. The best specific use of these charts is
to establish improvement goals and to expose these
charts and their goals constantly to the personnel.
Display charts can be created inexpensively from
wood or paper and colored tape. They should be
large enough so they can be seen from any place in
the area. Miniatures of these charts can be supplied
to managers on paper.
2. Problem identification. The quality engineer assigned
to each area should provide a daily listing of the
items causing the most important or frequent defects.
By classifying these as to seriousness, cause, and re-
sponsibility, the quality engineer sets the stage for
THE PROGRAM 171

corrective action with the personnel involved. Those


items which do not get resolved promptly can be
moved further along the corrective action cycle (see
step 6).

Data acquisition. Noncomplex forms should be


supplied
to inspection and test personnel so they can record the
results of their measurements. The basic information re-
quired is:

1. Part name and number; date; name of inspector and


operator
2. Amount checked
3. Amount found defective
4. Specific description of the defect

5. Operation and area where detected

The quality supervisor or engineer should review


each defect and assist in classifying it.
Collected data are compiled, and status charts are
posted. Problems identified are listed in order according
to frequency, and this information is supplied to the su-
pervision of the area as well as to other management
people. The trends or situations exposed should be im-
mediately placed into the corrective action system.

Comment: There is really no excuse for someone not


knowing what is happening.

Service Measurement
Planned programs of improvement in quality, productiv-
margin, and so on are usually concentrated in
ity, profit
the manufacturing areas. There the people are physically
well organized, the work is measured and analyzed, and
the management is resigned to the necessity of continu-
ally doing better. Thoughtfully conceived and conducted
programs always produce results. We know a lot about
improvement in manufacturing. Yet in manufacturing
plants at least half the employees are "white collar" or
service personnel who never touch the product. In
"pure" service companies like insurance, finance, educa-
tion, or hotel, almost all the employees meet this defini-
tion. The implementation of improvement programs in
these types of industries is not usually formalized be-

172 THE DOING
cause of the difficulty of measuring current status and
thus the difficulty of recognizing improvement or its
lack. Yet these are the jobs that absorb the majority of
compensation costs, generate expenses, order things, pay
the bills, communicate with the customer, and direct the

actions to be taken in the company all through marks
on paper. This "software" makes the company "hap-
pen," or not happen.
Studies show that over 85 percent of these pieces of
paper contain an error at least one error. None of
these errors is necessarily highly significant, or a disaster
in itself, but it needs to be found and fixed. This fixing
changes the process of the operation and starts a chain
of waste. The cost of this fixing runs at least 25 percent
of the operating expenses of any function. That means
that one dollar out of four is spent doing things over
and, in the process, not doing something that should
have been done. To figure this "cost of time," multiply
the time spent by each employee involved in the occur-
rence by 3. The 3 comes from counting the time taken
to do it in the first place, the time taken to fix the error,
and the time lost that could have been spent on a new
task. This doesn't include the cost of finding the prob-
lem, which may be bigger than the cost of time itself.
Eliminating this waste through local management actions
is a big source of profit for a company in a day when
profit sources are drying up. Consider a few typical
cases of "paperworkmanship" problems:

• An order-writing group takes the salesperson's input


and produces a shop order that tells manufacturing the
specificson the product ordered. Because the order
writer checked "green" instead of "blue," the customer
gets the wrong item. All the time spent making sure
the order is manufactured exactly like the requirement
was wasted. The requirement was wrong. Worse, the
real cause of the errormay not be found until a lot of
unnecessary actions are taken.
• Accounts payable people placed the wrong informa-
tion on the computer input card. Therefore, the com-
pany could not take the discount reduction.
• A new product released to manufacturing has 231
engineering changes to be accomplished. An examina-
tion shows that all but three are mathematical errors,
THE PROGRAM 173

drawing goofs, or nonscientific normal-type mistakes


that we have lived with for years.

• Welfare officials state that clerical errors cost them


more money than any other source.
• The hotel clerk sends a guest to an unmade room. As
a result, the clerk, the bellhop, the housekeeper, the
maid, the reservations clerk, and, of course, the guest
allspend an unscheduled fifteen or twenty minutes
doing something that didn't need to be done.
• Because someone pressed the wrong key on a teletype
a very busy person wasn't met at the airport.

To overcome this waste, and to bring the problems


out where you can get at them, requires three things:*
1. Recognition by management that the situation exists.
This step is up to management.
2. A method of Measuring current status. This is always
felt to be themost significant problem in improving
paperwork and service areas. In manufacturing shops
every step is monitored by quality control people, and
performance is calculated to the last digit It is not
this way with paperwork and service areas, and it is
perhaps necessary that it should be. However, every-
thing can be measured if you have a basis. In the case
of paperwork the basis is change caused by unplanned
deviation from procedure.

3. A program for correcting present problems and pre-


venting their recurrence. Every activity makes mis-
takes at one time or another. These mistakes must be
corrected. The correction may be formal, for exam-
ple, a purchase order change notice, a computer
punched card, or a certified letter. Or it may be m-
formal, for example, replacing, erasing, or destroying.
However it is done, the people in the area know
about it, they know how to do it, and they know how
All these are contained in a new program called Make Cer-
tain, which is outlined in detail in Chapter 13. Developed
specifically for "software" and service operations, it is proved,
practical,and uncomplicated and can be conducted during or
after the fourteen-step program. Implemented by supervision, it
produces cost elimination, and, what is perhaps more important,
develops a positive sense of participation and accomplishment
on the part of employees and management.
174 THE DOING
to count it. All you have to do is ask them to help
identify the correction method so it can be used to
quantify measurement procedures. Charting these
measurements provides the method of recording
progress or its lack. Having agreed-upon measure-
ments cannot be overrated in an improvement pro-
gram. Without them there is nothing. The difficulty in
developing measurement is the reason such programs
have not been implemented more often in administra-
tive areas. Now measurement can be uncomplicated.

Kate asked Bill to brief the team on the requirements of


the measurement step and its purpose, and to add whatever
background material he felt they needed. Bill stated that the
measurement step was probably the most important aspect of
the entire program because it let results be known, for better
or worse.
"It is particularlyimportant that we establish our measure-
ments and record them at this time so we'll be able to know
if we're doing any good.
"There are two things we have to make certain get taken
care of: First, we have to make arrangements to have
agreed-on measurements for each department, and second,
we have to have a method of displaying the measurements
where everyone can see them."
Otto leaned forward. "You don't intend to have some kind
of chart on the defect rates of different areas hung up where
everyone can look at them, do you?"
Billnodded in the affirmative.
Otto shook his head. "I don't think that's the way to do it.

Tm sure my
buyers wouldn't like everyone to know their

problems at least when they weren't in a position to know
the reasons. And I really am sure that our suppliers wouldn't
like their names all over our plant. After all, that's what
we're measuring in purchasing, the goodness of the compa-
nies that supply us."
"Well, we have the incoming products checked in re-
all

ceiving inspection, and we know exactly how much is ac-


cepted and how much is rejected, so why couldn't we use that
as the measurement?" asked Will Ellis.
"That's what I was saying, Will," replied Otto. "We have
several thousand suppliers. It would be impractical to have a
chart for each one of them, and, even if we did, the people
"

THE PROGRAM 175

here wouldn't relate to it. They'd just talk about 'those dumb
suppliers.'
"I've been doing some investigation inthis area, Otto,"
commented Allen. "I think there is a method you might think
about. It is called a 'buyer rating.' All you do is charge
against each purchasing agent any supplier-caused error. This
provides a defect rate. From what I know about the system,
itshows pretty clearly that some buyers are just not as care-
ful as others, and this brings it all out in the open. Why don't
you think about it?"
"It might take a lot more than thinking. I'll talk it over
with the buyers and see what they say."
"I think," Bill said, "that we are all going to have to have
department discussions to determine what type of measure-
ments will be specifically made. We have no problem with
manufacturing because, true to the concept of the 'manufac-
turing ghetto,' everything is measured there. We'll just have
to pick up the ones that need to be emphasized. Personnel,
marketing, and the other true service departments will have
to give us their input later this week. I might point out that
your supervisors are measuring their people every day. If
they don't know what to put on a chart, just ask them who
their best people are and then ask them how they know."
Kate leaned back. "Now let me get this clear. You are say-
ing that we should have some kind of measurement chart that
is highly visible
— —
perhaps hanging from the ceiling in each
area that we'll use these charts to measure the progress of
the quality improvement program?"
Bill nodded.
'Then that means we have to be careful about what we
pick and make sure it is meaningful. We have to have per-
formance measurement that relates to the success of the com-
pany."
Ralph Lowell interrupted. "We have all this field failure in-
formation, Kate, and has never really been analyzed. Sup-
it
pose we dissect it. That will let us know what areas we need
to emphasize. It could give the departments some ideas."
Kate beamed. "Now that is a great suggestion. Can the
quality people help?"
"Yes. We'll work with the field service group immediately.
I might suggest also that we use the results of this analysis as
the starting point for the improvement program. In other
words, we can say that this is where we stood when the team
began operation."
176 THE DOING
"Done, Now we can break up the meeting. I am going to
give you information about measurement and about the next

step in the program the cost of quality. That is also
measurement of sorts. I hope you'll take time to read this
little outline on the cost of quality so well all understand it

the same way. It is what the whole thing's about."


As the group began to rise and leave, Alice Wagner, the
comptroller, sat quietly as though lost in thought. Noticing
this, everyone sort of paused in their exodus. Kate, a little
concerned, asked Alice, "What's bothering you, Alice? Is that
accountant's mind of yours running a balance sheet on us?"
Alice smiled.
"No, Kate, as a matter of fact I was just thinking how well
everything is going and how I have confidence that it is all
going to come out the way we think it should. Particularly
the cost of quality thing. I've known about that for some
time, and I must say that I couldn't get anyone interested in
it However, that is beside the point. And speaking of points,
as long as you're all standing there staring at me, I guess I
might as well make mine."
Most of them sat down. Ralph and Allen leaned against
the wall. Wagner rarely spoke about anything in the staff
meetings unless prodded. She had already talked more in
these few moments than in the previous year. Obviously she
had been thinking about something and now had decided to
part with it
"The thing that has been bothering me since we started to
do this quality improvement program is why we needed it at
afl."
She raised her hand as Allen started to lean forward. "I
understand allabout the poor products and service we have
been inflicting on our customers. And I recognize that actions
need to be taken to correct the situation. As a matter of fact
they are very long past due. I recognize all that What gave
me trouble was why we had to go into this unusual formation
to solve it Why do we have to have a team, and a set of in-
flexible steps that have to be followed in order. After all, we
are only going to do what we should be doing anyway.
"The setup obviously isn't for the employees; they are
pretty much willing to go along with whatever we want. The
boss has already taken the blame for the whole situation, so
we aren't looking for a scapegoat and we aren't all pulling
on a rope together, so there is no load to move."
Ralph stirred. "You mentioned a point"
THE PROGRAM 177

"Right. point. Well, the point is this. It is apparent to me


A
that most managers, us included, are so concerned with to-
day, and with getting our own real and imagined problems
settled, that we are incapable of planning corrective or posi-
tive actions more than a week or so ahead. This team, and
the long-range improvement concept, forces us to plan ahead.
It requires a commitment from us and, most important,
creates an environment in which we can all be completely
honest with each other and work together without feeling we
are going to be criticized or competed against. I think we
have to recognize that we have been placed in this position
for a purpose and that the success of this team may very well
be the success or failure of the division.
"With that I am going to give you some advance informa-
tion. As I said, I have been interested in the cost of quality
for some years, and a few days ago we ran a calculation on
it I would like to report that our cost of quality is 20.2 per-
cent of sales. To spare you the mathematics that is almost
$11 million per year. My point folks, is that there is nothing
more important for us to do than to reduce that to the 4 per-
cent of sales, or $2.1 million, that the quality professionals
say is reasonable if not lovable. The difference is just $9 mil-
lion! We could add an easy four megabucks to our profit by
doing this right.
"So I am my staff tonight.
going to meet with Weare go-
ing to figure out a way
to measure accountants, timekeepers,
auditors, and everyone else in a way they will respect and ap-
preciate."
There was a small silence. Then Ralph said: $11 million
for doing things wrong? Do you have this all broken out?"
"Thought you'd never ask," smiled Alice. "I have copies
here for all of you. Note that there is no heading and very
little explanation. I wouldn't want this kind of information to

get out where the competition could get at it. Most of the
costs I have are for labor of one sort or another. I didn't
count engineering changes or rework done by the white-collar
people. However, almost everyone is there.
"I took a figure of $17,000 per person to cover salary and
burden. In some cases, that figure is too high, but in most it's
too low. But overall it is fair. In my opinion the entire pic-
ture is understated." She gave them the figures.
178 THE DOING
• Field service personnel (all of
whom exist only to repair
and replace products at
the customer's place) 281/ 17K = $4,777,000

• Quality department (most of


whom we wouldn't need if we
did things right) 187/ 17K = 3,179,000

• Manufacturing personnel
involved in in-house rework 62/ 17K = 1,054,000

• Warranty costs 1,269,750

• Scrap 620,241

Total $10,900,000

There was a long silence as the numbers sank in. Finally


Ralph asked if this meant that the entire field service depart-
ment was the target of the improvement program.
"Not hardly," replied Al. "But as we improve our outgoing
quality, there willbe fewer field services to perform. At least
as the work structured now. But don't feel bad; my whole
is
department is a contributor too."
There was a moment of silence. Then Will spoke.
"If we solve the problem right, we will grow enough to
keep all our people, but we have to remember that we are
trying to repair the health of the company. If we don't get
and done right, the choices will be taken from us."
that done,
"Meeting dismissed," said Kate.

STEP FOUR:
THE COST OF QUALITY
Purpose: To define the ingredients of the cost of quality,
and explain its use as a management tool.

General Operation

1. The cost of quality is composed of the following:


Scrap Inspection labor
Rework Engineering changes
Warranty Purchase order changes
Service (except regular Software correction
maintenance) Consumer affairs
THE PROGRAM 179

Audit Acceptance equipment


Quality control labor costs
Test labor Other costs of doing
things wrong
2. This total expense should represent no more than 2.5
percent of your sales dollar.

3. If your cost of quality is more than 2.5 percent, you


have a direct opportunity to increase your return on
sales by the exact amount you can reduce this ex-
pense. This reduction is most efficiently and quickly
taken by concentrating on preventing the defects
rather than on reducing the amount of acceptance
operations, since it constitutes only a small part of
the cost.

The following are reasonable expenditures for qual-


ity cost.

Rework. The amount of direct labor, burden, and


material required to correct nonconforming material.
Allowable 0.25% of sales
Your actual

Scrap. The amount of unplanned scrap produced in dol-


lar value, plus the added value of labor and burden to
the point of discard.
Allowable 0.25% percent of sales
Your actual
Warranty, service. The dollar value of sold items re-
turned by the customer for nonconformance, and the
expense of replacement, repair, or service.
Allowable 0.2% of sales
Your actual

Acceptance labor. The salary and expense of the inspec-


tion,quality control, test, and audit personnel who
measure nonconformance and similar functions.
Allowable 1 .8 of sales %
Your actual

Sharon couldn't wait to find out how the meetings went


that day, and Bill couldn't wait to tell her. This no-wait pol-
icy led to a lot of rapid interrupting until Bill finally held out
his hands and asked for calm.
"Let's take it from the top, and I'll tell you the whole
"

180 THE DOING


thing. We got together today for our weekly meeting and dis-
cussed the measurement system briefly and then I started to
bring up the awareness activity. It's time we got started on it,
although I'm not sure everyone is too interested in hanging
posters all over the place. Every time I turned to that subject
someone would bring up the cost of quality again. I just can't
tell you how big an impact that number, and the revelation
that it existed, has had on these managers. They really didn't
believe they were playing for such big stakes."
"I don't understand," said Sharon. "Doesn't every company
figure their cost of quality like that? Is ours so much higher?
What is the big surprise?"
"The surprise, my dear, is that very few people figure it
with the deadly entirety of our comptroller. In every com-
pany I've known about, they have cut it down as small as
possible. For instance, they only include the salaries of the
people doing rework, not the burden, and they don't count
the supervision involved. Yet if you didn't have those people,
you wouldn't need the supervision. It really points out that
we were heading for an extremely difficult financial situa-
tion."
"I think there is another reason everybody was so
shocked," smiled Sharon. "I think a lot of them realized that
they haven't been doing all that great a job of managing the
company. They could have made operations a lot more
profitable."
He looked at her in surprise. "That's just what Will said.
He made it very clear that if we could cut our defects down
to zero we would have all that money to grow on and that
we could use the people for that It isn't a matter of decimat-
ing the operation; we are going to need good people to ex-
pand. This has been hanging like a rock around our
pocketbook. We couldn't grow because our products needed
so much work and attention. If we get our products right,
then the way is clear."
"I think you should call this the 'new attitude program' in-
stead of 'quality improvement.'
"You're absolutely right. But you can't let the team know
that; they think they invented the whole thing. Let's eat, I
need my strength."
"Hunger an attitude too, you know," remarked Sharon.
is

"I have we don't think enough about atti-


this feeling that
tudes. Most of the people I know who have problems seem to
me to create most of their problems through their attitudes.
THE PROGRAM 181

They feel this way or that way about things, they are bigoted
or not, and all of it seems to be unconnected, like it is just a
pattern of thought they picked up during their life."
"I have noticed that negative attitudes seem more con-
tagious than positive ones."
"That's right. The other night I watched a minister on TV
who healed people by touching them. I don't understand it
all, but there have been cases of lame people walking, deaf

people hearing, and so forth. I am all for these cures,


whether they are God's work or whatever. But I sure wish
that we could do more about healing attitudes. That would
do a lot more good for peace and prosperity than any
limpless foot."
She paused.
"OK, attitude healer. Come on and eat"

Note: The cost of quality is the catalyst that brings the


quality improvement team and other management
people to a full awareness of what is happening. Before
that, often they are only going through the motions of
the program just to give the right impression. After all,
modern companies are filled to the brim with programs:
savings bonds; blood donor drives; value analysis; Buck
a Day; United Appeal; cleanup inventory control; cost
reduction; and on and on. The cost of quality takes the
business of quality out of the abstract and brings it
sharply into focus as cold, hard cash. Suddenly the po-
tential for achievement is there. Suddenly, it really is a
profit maker instead of a negative thought
Don't get so involved with the techniques of calcu-
lating the cost of quality that you forget what it should
be used for: to call attention to the problems and as a
way to identify those areas needing corrective action.

STEP FIVE:
QUALITY AWARENESS
Purpose: To provide a method of raising the personal
concern felt by all personnel in the company toward
the conformance of the product or service and the
quality reputation of the company.
182 THE DOING

General Operation

1. By you are ready for the quality awareness


the time
step,you should have a good idea of the types and
expense of the problems you face. These will have
been revealed by the quality measurement and cost of
quality steps.

2. The idea of quality awareness is to show everyone the


need for improvement and prepare them for eventual
commitment to the Zero Defects program.
3. The quality awareness activity has two essential ingre-
dients:

a. Regular meetings must be held between manage-


ment and employees to discuss specific noncon-
formance problems and to attempt to arrive at
some steps that can be taken to remove these
problems. These meetings should not only be be-
tween workers and their supervisors but also be-
tween the supervisors and their managers.
Meetings should be short, positive, and to the
point. They must take place on a regular basis,
and promises made must be kept
b. Information about the quality program must be
communicated through posters, articles in the
house organ, and special events. The purpose of
this is to provide reassurance that the company is
serious about the emphasis on quality and to keep
the message constantly in front of the people. The
material necessary is quite inexpensive and can
even be homemade. Some companies run quality
poster contests for the employees and their
families, giving small prizes for the winners while
at the same time amassing a huge supply of free
posters.

The quality awareness portion of the program


should be planned by the improvement team. However,
they should lean heavily on public relations, personnel,
and similarly skilled functions.

Comment: Quality awareness should be low-key and



constant a consistent stream of events with no real
start or finish.
THE PROGRAM 183

As the program began to take shape, the team communica-


tions became more complex. Bill Ranson decided to begin a
series of status memos to make certain everyone was receiv-
ing the same information.

Memorandum to: Quality Improvement Team


From: Ranson
Bill
Subject: Measurement

We now have the primary measurement categories


planned by each department as well as the preliminary
status of field failure causes. Unless I have word from
you to the contrary, these will be our benchmarks in
describing the situation as it exists today. Detailed re-
ports will be sent to you on the field problems. This is
just to summarize what the customer is seeing:

1. Product Measurement

Customer
Item Rejections Primary Problems

Toasters 8.6% Open coils


Wrong handles
Shipping damage

Comment: Coil problem has been traced to poor solder-


ing at vendor. Handles were to drawing but both were
obsolete. Shipping damage cause not clear yet.

Customer
Item Rejections Primary Problems
Personal TV 14.3% Wrong color received
Component failure

Comment: Color of set case and the color marked on


the box don't correlate occasionally; the reason is not
known. Repair technicians find that components have
been placed in the wrong position; final test in factory is
suspect and is being checked.

Customer
Item Rejections Primary Problems
Electric skillet 6% Flaking plating
Stencil blurred
184 THE DOING
Comment: Handle paint is chipping off; reason not
known yet. Stencil blurred was the main rejection rea-
son, apparently due to sloppy handwork in-plant

Other products will be detailed in accompanying report

2. Department Measurements
Manufacturing. Line charts now in use provide de-
fects per unit and percent defective measurement in
all areas. In addition the personnel involved have de-
cided that they would like to have the improvement
goals placed right on the charts and the charts hung
over the work areas on 3- by 4-foot boards so every-
one can see them. All charts will be this size except
in office areas, where they will still hang from the
ceiling but will be 2 by 2.67 feet

Engineering. Drawing change notices for each group


as well as errors found in drawing checking, will be a
major source of measurement
Computer programming. Calculate computer time
needed to "clarify" programs, and "arithmetic" errors
found in program checking. Also measure any down-
time caused by punching errors.

Comptroller. Measure accounts receivable overdues


and ledger errors found in audit Make random arith-
metic inspections on timekeepers sheets. A
suggestion
program is now being conducted to determine ways
to make more personal measurements.

Quality. Compute customer rejections, defects re-


peated after corrective action, and errors found at-
tributed to a previous department. Review board
action taking more than one day.

Purchasing. Calculate receiving acceptance product


defects that are attributed to the buyer instead of the
supplier. Also, find any omissions of proper specifica-
tions, etc., from purchasing order.

Marketing. Calculate errors in order documents, mis-


statements of product specifications in response to
bids, price notifications missed, etc.
THE PROGRAM 185

Field Service. Identify repeat failures, illegible report-


ing forms, workmanship audits.

Guards. Note failure to punch location clocks. Iden-


tify security violations.

Personnel. Measure tardiness of workers. Analyze


contract grievances by the union. Note delays in pro-
cessing transfers and training program completions.

Kate stood in front of the quality improvement team. "The


important thing we have to remember about the awareness
step is that we have to reach every employee, and they have
to be reached by their supervisor with their peers. These are
the people who are really important to them."
Harry Williams asked, "Why can't we just have one big
meeting and get the message to everyone at one time? Then
we could get the whole thing over with sooner and get started
on recovering some of that money we're wasting."
Kate looked toward Bill, suggesting that he answer this
question.
"We probably should take that approach when we get to
Zero Defects day because then we are looking for a commit-
ment from everyone to accelerate the program. However, at
this point, it is necessary that weexplain the situation care-
fully to each individual and that each person hear it from the
supervisor. Otherwise they might not feel personally involved
enough to make the suggestions and take the actions neces-
sary to reduce the errors.
"Perhaps we better review the next few steps to see how
they fit together. Awareness is to let people know that we are
emphasizing quality and its importance. The supervisors need
direction in taking this problem to their people. We are going
to have to do some supervisor training.
"After that we establish the corrective action system
formally. Actually it does already exist, but it needs rebuild-
ing. After all, if we are going to ask people to solve prob-
lems, we have to have a corrective system that works.
"Then we can plan for the Zero Defects program. Once we
have launched it, we will start error cause removal and then
go on to goal setting and recognition."
"Why don't we just go into Zero Defects right away? After
all, that is our goal. Why fiddle around with these other

steps?" said Harry.


Al spoke up. "We are after a permanent improvement pro-
186 THE DOING
gram, one that will become part of the culture of the com-
pany. To do that we have to make sure it is well established.
We will get a large amount of improvement out of the steps
we are taking prior to ZD. If the figures of other companies
can be believed, we should reduce our errors about 40 per-
cent through those actions. In effect we are knocking off the

easy ones obvious things like improving solder workman-
ship, being more careful with writing process plans, and dou-
ble checking the packaging.
"But when we talk to our people about ZD and ask them to
do every job right the first time, we have to be able to re-
spond to them. People take a request like this seriously.
When they look at their job to see what is standing in the
way of perfect performance, they want to be able to pinpoint
the cause of error. All they need to know is the problem. It is
up to us to find the solution."
"Let me see if I have this clear," said Otto. "We are going
under the assumption that the people of this company have
never had it made clear to them that we expect every job to
be done right every time. Therefore, we are going to tell
them that slowly so they don't get too shocked. Then we are
going to help them perform to that standard by fixing the
problems they tell us they have. All this is going to eliminate
errors. Correct?"
"I've never heard it stated so clearly. You are correct."
"You know, it just might work."
"Of course, what we are
really after is to establish the pre-
vention of error as a fact of life and performance. That's
where the future lies."
"OK," said Kate. "Let's get down to determining what we
are going to do about awareness. I presume that our coordi-
nator has made arrangements for some posters and other in-
ternal advertising."
"Right. I have ordered posters from commercial suppliers
that say the standard things, like "quality is the best way to
ensure jobs," and so forth. However, my
wife has a sugges-
tion that the team might want to consider."
"Speak," smiled Kate.
•The suggestion was that we ask the children of the em-
ployees to create quality posters for us. We can use the next
issue of the company paper to announce it The prize could
be some of the products."
Otto said, "What if the products don't work? How about
giving something children would like. A
day off from school
THE PROGRAM 187

for instance. Or all the TV you can watch in twenty-four


hours? Or some books?"
One by one the team members acknowledged that thiswas
a great and gave the authorization to
idea, go ahead. Kate
was something that should be discussed with the
felt that this
union representatives. Al cautioned her to remember that you
didn't have to be in the union to have children. The contest
would be open to all, it would be dignified, and there was no
reason to ask for permission.
"OK," said Kate, "we'll have an information meeting."
It was decided to invite all supervisors to meet in the cafe-
teria after work that evening for a thirty-minute orientation
on the program. After that they would meet individually with
their department heads during working hours the next day for
specific briefings. All employees, with the emphasis on 'all,*
would have discussions with their supervisor on the impor-
tance of the quality program within three days. Then group
meetings would be held every week until furtner notice.

Supervisors/Quality Improvement Team


(Some Representative Comments)
Hugh: "I have made plans for a pleasant and remunerative
career topped by a reflective and affluent retirement. If we
don't get this quality situation solved, these things will not
come true. Whether or not we improve is entirely in your
hands. People perform to the standard of their leaders, and
you are their leaders. I am your leader, and I say we are go-
ing to make the products like we told the customers we
would."
Kate: "The marketing people are behind this program all
the way. The regional marketing people have asked how soon
they can bring some of their biggest customers into the plant
so they can see for themselves the type of quality per-
formance that we conduct I told them to give us two
months. Hugh says that is too long."
Bill: "When you talk with your people, conduct the meet-
ing around a table and talk openly. The quality engineers
have provided you with error details so you can ask your
people how to overcome some of the problems listed. Don't
reject any ideas or put anyone down. The service area super-
visors will emphasize the effect of what their groups do,
rather than the specifics, until we get more data. However,
you know the problems. The idea is to enlist everyone's coop-
eration and participation in this quality improvement drive."
188 THE DOING
There were a few questions about techniques and a bit of
uncertainty about how well some of the groups would re-
spond. However, as Hugh noted at the close of the meeting,
no one had suggested that the actions weren't necessary. That
in itself made it obvious that they had better get moving for
sure.

Assembly
Carl Albert sat around the table with the sixteen people who
made up his group in cable harness assembly. Nine women
and seven men were all nervously glancing at him and each
other. This meeting was not his usual way of working. Carl
didn't really care for the idea at all, since he was much more
used to dealing with his employees one at a time, or at most
in pairs. However, he cleared his throat and attempted a
small smile. Tm
glad we could all get together for a few mo-
ments to discuss something that is very important to all of us.
That is quality."
He noticed a reflection of relief on several faces.
"Last night we had a meeting with the general manager
and his staff as well as all the other supervisors. The purpose
was to inform all of us about the quality situation so that we
could come and talk to you and so that between the whole
bunch of us we could do something to make it all better."
Carl surprisingly found himself out of breath. He paused
and noted, "I guess I'm not too experienced at speaking to
large groups." Everyone laughed and a few lit cigarettes as
they began to feel a bit more comfortable.
"What I mean is that we are having problems with the
products in the field because of defects that are being put in
here at the plant because of poor design and quality of work,
and because of supplier problems. No one is exempt We have
to work together to see what we can do to prevent these
problems."
Martha Howard raised her hand. "What about inspection?
Aren't they supposed to catch these things before they go
out?"
*They sure are Martha, and they're going to have to find
better ways of doing inspection and testing. They are having
meetings at this very moment on this subject. However, if we
are fair about it, we have to recognize that if we do our jobs
right and completely, there won't be anything for inspection
to miss. Prevention, that is our problem."
"What kind of problems are they finding with our work?"
THE PROGRAM 189

asked Leroy Anders. "We get some feedback, but usually


anything they find wrong with our stuff goes to the rework
area and we never see it. I think I would like to do my own
rework and then I'd know what is going wrong."
"Gee, Leroy, that's a great idea. I'll bet nobody ever
thought about that aspect. They probably think they are do-
ing us a favor by taking the rework to another place. I'll get
that to management right away,"
"What kind of items are they finding at the dealer's?"
"I have a list here of things that relate to us. The most
common is reversing the wires on the internal power plug for
the TV sets, and next most common is leaving a wire out of
a bundle. The rest are nicked or damaged wires and little
items. Our most expensive rework is the TV plug. Anybody
have any ideas on what to do?"
Martha stuck her hand up again. "You know, Carl, both
those wires are the same color."
•They didn't used to be. One was red and the other was
black."
"Well, they're both green now."
"Must have been a cost reduction."
"How about having someone put a tag on the wires for a
while, andwe'll be more careful?"
"OK. We'll do that. Now let me say one more quick thing
before we break up. We'll have another meeting next week.
In the meantime, if you have more thoughts, just tell me. But
we're serious about this quality improvement business. The
measurement charts on defects per unit are going to be hung
up this week right over there. They will show how well we're
doing. Our level is 5.6 defects per harness. That's very high.
I'd like to see us get it down quickly. One way to do that is
to start doing our own rework so we'll know better what
problems we are making for ourselves. Thanks."

Production Control
The production control group gathered around the highboy in
the metals stock bin. Harold Withers thumped the steel desk
good-naturedly and called for order. He and his men had an
easy familiarity grown from having worked together for a
long time.
"I'm going to talk to you about quality," he smiled.
Several groaned.
"I figured you'd react that way. You guys think that qual-
ity has nothing to do with you; you think it is all involved
190 THE DOING
with the quality department, that it is their problem alone.
The reason I know you think this way is that I had that in
my mind until last night Last night I saw some of the prob-
lems we have around here, and I saw that we are indeed a
big part of their solution."
"How could we have much to do with it, Hal?" asked Tim
Collel. "Unless you look at the things we drop once in a
while, we have no way of affecting quality."
"Suppose I told you that the biggest single problem in
printed circuit board assembly was wrong components on the
boards. Someone picked the wrong component out of the
hand bin and put it on the board. Who do you suppose put it
in the hand bin?"
Everyone tried to speak at once. "That's not so." "We
don't do that, we just deliver the parts. Other people put
them in the bins."
Hal held his hand up for quiet
"Now let's start all over. We touch every piece of product
that goes through this operation. We mother it from the re-
ceiving dock to the shipping dock. We expedite some and re-
tard others. We move the product from assembly to
inspection, from stock bin to garbage can. If it gets bought,
made, stored, scrapped, or just rotated, we touch it Right?"
"Right."
"Then we contribute to the problems involved in getting
everything together by mixing things up once in a while or by
somehow interfering with the flow."
There was a silence and then a slow nodding of agreement
"And 111 tell you what's more important than that. We see
everyone in this plant all day long. We are attitude formers
whether we like it or not Thought leaders. You won't find it
up on one of those measurement charts, but we are the ones
who can affect how everyone feels around here. If we're
frowning we spread it around; if we're smiling, they're
smiling. Right? Right.
"So, starting that moment we are going to be walking, talk-
ing examples of quality. I got the quality improvement coor-
dinator to have some badges made for us and we're all going
to wear them, they say: I'm for Quality. We're going to wear
them everywhere, every day, and we're going to be very care-
ful how we do things. Right?"
The group smiled. Hal really was right
"Do we get to offer suggestions on how to do our job bet-
ter?"
THE PROGRAM 191

"You sure do. Give them to John and we'll meet again be-
fore work tomorrow morning and discuss them. Anyone who
can't make it, that's OK because it is a no-pay time. But
we're going to be the most improvement-oriented outfit in the
company. Right? Right."

And a Final Note


Hugh Al to have a cup of coffee with him. Walking
invited
to the cafeteria, they both nodded and spoke to everyone they
met. Hugh in particular had developed a good visual relation-
ship with the employees. They appreciated his positive ap-
pearance and brisk step. Al felt that the operation was in
good hands.
"I think the improvement program is off to a good start.
We are already getting some reduction in defect rates, and
the moving of rework back to the person who caused the
problem seems not only to be a good corrective action but is
also good for morale," said Hugh.
Al beamed. "I think you're correct. The preliminary num-
bers from the field are better also. As far as I can tell the
meetings between the supervisors and their people went off
well. Most folks were surprised that they occurred at all.
Overall this program has to be a great thing for the com-
pany."
Tm sorry we didn't start it sooner, Al. But at least we did
get moving. I think you are to be congratulated for making it
happen. And while I'm patting your back, let me also state
that if you had made a bigger deal about those cost of qual-
ity numbers you probably could have sold the program ear-
lier. But that's just a guess."

"I know that is absolutely correct, Hugh. I've kicked my-


self for holding back. From now on they will be right up
front."

STEP SIX:
CORRECTIVE ACTION
Purpose: To provide a systematic method of resolving
forever the problems that are identified through previous
action steps.

General Operation
1. Problems that are identified during the acceptance
192 THE DOING
operation, or by some other means, must be
documented and then resolved formally. The most
direct method is to establish four levels of constant
activity:

a. Hold daily meetings between the area supervisor


and a quality engineer or supervisor to examine
the problems detected. Determine methods of cor-
recting the present situations while preventing
their recurrence in the future. These meetings
should be documented on an item-by-item action
chart that states the problem, the seriousness of
the problem, and its cause, as well as who is going
to do what when.

b. Hold weekly meetings between the production


general supervision and senior quality manage-
ment to attack problems that cannot be, or were
not, solved at the lower level. They should invite
to their meetings the other department personnel
involved. The meetings should be documented on
the same type of action chart mentioned above.

c. Monthly or special meetings should be held by the


general manager and staff to review the unresolved
problems. Items reaching this level should be
specific; those requiring complex or long-range ac-
tion should be assigned to a task team.

d. Task teams should consist of responsible members


of each affected organization with one person ap-
pointed as chairperson. The jobs of the task team
should be carefully spelled out, and their com-
pletion time specified. The team may have to meet
daily until the problem is resolved. At the time the
problem is judged to be eliminated, the team
should be dissolved.

Comment: Corrective action is most successful when it


operates on the well known Pareto principle, which
states that the biggest and most important problems
should be attacked first, then the next biggest, and so on.
The attitude of defect prevention provides the incentive
to fix a problem once and for all so it will never come
back.
THE PROGRAM 193

A Sample Corrective Action Communication


TO: Mr. Allen Fielding
FROM: Boyd Deams, Quality Engineer
SUBJECT: Corrective Action Meeting on TV
Problems

ATTENDEES: G. Wilton, Marketing


Y. Brothers, Engineering
B. Gilbert, Manufacturing
B. Deams, Quality
S. Leed, Field Service

As you know we have had many incidents at a cus-


tomer's store of the TV set being of one color and the
label on the box saying it is of a different color. The
dealers have been very irritated and occasionally embar-
rassed by this; it means that they have to open the box
to find out what is in it. As a result of our not correcting
this problem, dealers have taken to shipping all their
products back to the field service areas in order to have
corrective action taken. A corrective action meeting was
called in order to find a method of preventing the prob-
lem in the future.
S. Leed stated that the label, listing serial number
and color, is attached to the box after the set is inserted
and the box is closed. He felt that this caused the prob-
lem, and would continue to cause problems. B. Gilbert
stated that the labels and the television sets are coordi-
nated to arrive at the box closing together, and that
what has been seen in the field are just a few that got
mixed up when the lines went out of sequence one day.
He felt that the problem would not be repeated.
G. Wilton said he didn't care who fixed the prob-
lem, but he definitely wanted something done because it
was destroying relations with customers. Deams suggest-
ed the team go to the warehouse and pull some samples
to see if the problem had been corrected.
Twenty-three boxes were selected at random and
opened. Nine contained sets of a different color than
that described on the label. The shipping supervisor was
called to the meeting and asked for his information on
the subject. He said the labeling machines skipped some-
times and that he didn't have enough people to do it by
194 THE DOING
hand. We then called the labeling machine maintenance
chief, who said that the machine was the most reliable
piece of equipment in the factory.
As the team was about to disband, Brothers suggest-
ed we look at the labeling operation and talk to the op-
erator. The operator showed us how the labels come
from a stack-up installed by production control near
where they are attached to the boxes. However, the sets
come from final testing and are placed on the packaging
and closing line by the testers when they are finished
with the test. Thus there is no actual coordination of sets
with labels.
It is apparent that we have been
fortunate that so
many were labeled properly, since the entire operation is
conducted by chance.
Corrective action has been taken. The problem
won't happen again.

cc: Quality improvement team

"Corrective action," said Allen, "is just a matter of getting


all the rocks rolled over and seeing what is under them. I
have never seen a truly complicated action that had to be
taken. Usually someone just assumes that someone else has
been doing something that they haven't"
"You make everything so clear," said Will Ellis. "I think
it's like the gold prices, where there are only two guys who

understand it and they disagree."


•Well, you knew what I meant"
"Certainly I did. And of course I agree. All I want to re-
ally know is how come everyone else has problems that
require documented corrective action and the quality depart-
ment has none. I think you are sweeping them under the
rug."
Al bristled: "We certainly were part of the labeling prob-
lem. And we did find that some of the rejections for soldering

were strictly opinion based on no fact"
"I know that Al. I was really just kidding. But on the
square, I have the feeling that we might not be doing things
right in a few areas. One of
those is receiving inspection. I
think we are being a little easy there —
certainly not as firm
and clear-eyed as you people in the shop."
Al thought a moment. "You could have something there.
you what I'm going to do. Just because you were kind
I'll tell
THE PROGRAM 195

enough to say that we do a few things right now and then, I


am going to do something I never have done before. I'm go-
ing to ask the corporate office to send one of the quality con-
trol people down to take a look at the receiving acceptance
operation."
Will smiled. "Now that is what I call a real sacrifice. Are
you sure you don't just want to have one of your guys do it?
These corporate types can get you into some real trouble."
John Halden, HPA
corporate quality engineer, came to see
A! the following week. After getting comfortable with each
other, John asked Al what he could do for him.
"First let me say that I am really pleased with the improve-
ment program your office sent us. We
are in the midst of in-
stalling it, and the results, even after this short period, have
heen amazing. In the first month we have dropped better than
one-third on our defect rates. Everyone is enthusiastic. We
should be having ZD day here in six weeks or so. Perhaps
some of your people can get down to participate."
"We'd really like that Al," said John. "Some of the compa-
nies have been asking the corporate president; he comes to
ZD days at the drop of a hat. Perhaps you should keep that
in mind."
'That would really make an impression on the people. Til
ask Hugh about it."
"Now, what was it you were interested in having me au-
dit."
"We have been concerned that we might
not be doing a
good job in receiving inspection. I thought that you could
help us out by spending some time there."
John nodded. "No problem. But before I get started, let me
fill you in on the procedure we follow in doing audits of this

sort We want to be very careful that we only contribute posi-


tive results to the operations and don't cause unnecessary
problems. So we go through several points. Here is a card
with the major actions listed on them."
Al took the card and read the action items.
1. Meet the quality manager and review the general situa-
tion: determine what the manager wants to accomplish.
2. Meet with the general manager and explain what you
plan to accomplish. Inform the manager that your report
will be written prior to your leaving the operation.
3. Ask if you can perform any specific service for the
general manager.
196 THE DOING
4. Conduct the audit, working with the quality staff. Be
sure clearance is obtained from any other department
heads before working in their areas.
5. Write your report in its final format and have it typed.
Review the report first with the quality manager and
then with the general manager.
6. If they have any disagreements with your findings, note
them on your report or, if their comments are correct,
change the report
7. If the report is to be distributed, mail it from the plant
Al looked up from the paper.
"Why do you go through all of this? The other staffs come
in, do their things, and then leave. We never hear from them
again."
"Well, we want to sure that what we are doing is
make
useful. Besides, you leave a plant, things begin to
after
change in your mind. When you write a report too long after
the fact, you are likely to make errors or even include items
that pertain to another plant After all, we cover a lot of
ground."
He leaned forward confidentially. "This way, we are sure
to be welcomed back. Most staff people have to fight their
way back in."
"That's a good point OK, let me see if we can get in to
have your visit with Hugh."

The Audit Report


TO: Hugh Gibbon, Al Fielding
FROM: John Halden, Corporate Quality Department
SUBJECT: Audit of Receiving Acceptance Operations

Actions Required:
1. Inspections and tests on vendor-supplied items should
be conducted to the terms of the purchase order
rather than to historical records and process plans.

2. Ix>ts rejected by receiving acceptance should be re-


turned to the supplier for sorting and correction
rather than having this done by inspectors.

3. Rejections made by acceptance


personnel should not
be reversed by supervision except in the most unusual
cases.
THE PROGRAM 197

4. Expeditors, purchasing agents, and production control


personnel should be excluded from the work area.
5. Conduct a quality awareness program for suppliers,
possibly including an in-plant seminar.

General Situation:
1. All inspections and tests are conducted according to a
historical file system set by quality engineering. Thus
when the terms of the purchase order change for a
specific item, the item can be tested, rejected, re-
viewed, clarified, and then retested before the change
is noticed. This causes considerable recycling and is
expensive. It is also destructive to the morale of the
personnel involved.
2. Most quality systems regard a product rejected in re-
ceiving acceptance as the property of the purchasing
department, which then disposes of it through return,
rework, or scrap. However, at HPA
we are oriented
toward taking steps as early as possible to determine
how to use the product Thus although an average of
18 percent of the lots received are rejected for one
reason or another, less than 0.5 percent of the lots
are returned to the vendors. This indicates a lenient
attitude. The suppliers will not take complaints seri-
ously.

3. Minor items called out by acceptance personnel are


routinely OK'd by their supervision without much ap-
parent thought.
4. There a great deal of confusion in
is the receiving ac-
ceptance work area. Expeditors are continually talk-
ing to the operators to determine the status of the lots
they are checking. Material is not well controlled,
and the rejected lots are not bonded.
5. Since supplied material is about 50 percent of the
finished product, I think it would be advantageous to
make the suppliers aware of the improvement pro-
gram being conducted. Many of the key suppliers
have no idea how you are using their product and
have no special relationship with HPA
or any other
customer except through the purchasing area. I think
it is extremely important that we recognize that sup-
198 THE DOING
pliers pass their cost of quality along to us. We
should help reduce that cost.

Opinion: Corrections of the above items, which require


no expenditure, will help receiving acceptance to "quiet
down" and exercise better control. In the plant it pos- is
sible to see the effect of the quality improvement pro-
gram. The people are enthusiastic and full of ideas. I
suggest that you consider moving into the error-cause-re-
moval phase of the program as soon as possible.

STEP SEVEN:
ZERO DEFECTS PLANNING
Purpose: To examine the various activities that must
be conducted in preparation for formally launching the
Zero Defects program.

General Operation

The quality improvement task team should list all the in-
dividual action steps that build up to ZD
day in order to
make the most meaningful presentation of the concept
and action plan to personnel of the company. These
steps, placed on a schedule and assigned to members of
the team for execution, will provide a clean energy flow
into an organization-wide ZD
commitment. Since it is a
natural step, it is not difficult, but because of the signifi-
cance of it, management must make sure that it is con-
ducted properly.

Specific Points: The main portions of ZD planning are:


1. Explaining the concept and program to all supervi-
sory personnel. Preparing supervisors to explain it to
their people.

2. Determining what material will be necessary and en-


suring its preparation.

3. Deciding what method of launching the program will


best suit the cultural environment of your particular
operation.

4. Spelling out the functions that will be accomplished.

5. Examining the recognition policy of the company and


THE PROGRAM 199

determining what type of recognition should be used


in praising improved performance.

6. Setting up the time schedule and rehearsing those


who will take part.

7. Identifying the error-cause-removal program and


making the plans for its execution (step 11),

Suggestions: Many companies have ZD programs, and


all are happy to share their detailed information. The
manager responsible for its implementation will better
understand what is involved by communicating with
them.
Although no express method of implementation is
recommended, a technique that has proved extremely re-
liable as a method of getting the concept and pledge
across to the personnel involves the use of a single-page
explanation of the concept with the pledge incorporated.
The company prepares one message for each employee
on its own letter head bond paper. On the appointed day,
the chief executive of the company discusses the concept
and pledge with those people reporting directly to him
and gives them each a copy of the letterhead explana-
tion. When all have had their questions answered, they
sign the pledge and the executive countersigns. The pa-
per is kept by the subordinate (who may wish to frame
it). Everyone who has signed takes enough copies to
handle the people in their departments. They repeat the
operation with those who report to them, and so on
down the line until each person in the company has dis-
cussed the ZD concept with his or her direct supervisor
and has signed the pledge with the supervisor. This
method ensures that each person gets the message; it
also ensures that management understands it.
Signing the pledge is, of course, a voluntary thing.
But if the explanation is conducted properly, there will
be no difficulty.
Unions all over the world have genuinely accepted
and supported the ZD program. They appreciate the
recognition it gives to the importance of quality work to-
day. But it is very important to make union people a
part of ZD planning. Some companies appoint a union
representative to the ZD part of the quality improve-
ment task team. Others merely keep them informed.
200 THE DOING
Whichever way you choose to get union participation, be
sure you do not neglect it.

Comment: Zero Defects is a very effective, inexpensive


management tool when wholeheartedly supported by
management.

Sample Zero Defects Letter

HPA CORPORATION
Zero Defects —The Concept
Zero Defects is a performance standard. It is the stan-
dard of the craftsperson regardless of his or her assign-
ment. It is not limited to production efforts; in fact,
some of the largest gains are obtained from service ar-
eas. The theme of ZD is do it right the first time. That
means concentrating on preventing defects rather than
just finding and fixing them.
People are conditioned to believe that error is inevi-
table; thus they not only accept error, they anticipate it.

It does not bother us to make a few errors in our work,


whether we are designing circuits, setting up a machine,
soldering joints, typing letters, or assembling com-
ponents. To err is human. We all have our own stan-

dards in business or academic life our own points at
which errors begin to bother us. It is good to get an in A
school, but it may be OK
to pass with a C.
We do not maintain these standards, however, when
it comes to our personal life. If we did, we should expect

to be shortchanged every now and then when we cash


our paycheck; we should expect hospital nurses to drop
a constant percentage of the newborn babies; we should
resign ourselves to going home to the wrong house peri-
odically, by mistake. We as individuals do not tolerate
these things. We have a dual standard: one for ourselves
and one for our work.
Most human error is caused by lack of attention
rather then lack of knowledge. Lack of attention is
created when we assume that error is inevitable. If we
consider this condition carefully, and pledge ourselves to
make a constant conscious effort to do our jobs right the
first time, we will take a giant step toward eliminating

the waste of rework, scrap, and repair that increases cost


THE PROGRAM 201

and reduces individual opportunity. Success is a journey,


not a destination.
Let's set our sights on Zero Defects.
ZERO DEFECTS—THE PLEDGE
I freely pledge myself to make a constant, conscious ef-
fort to do my job right the first time, recognizing that
my individual contribution is a vital part of the overall
effort

SUPERVISOR
Kate called the meeting to order.
"As you know, we appointed Marian Nelson, Ralph Low-
ell, and Will Ellis, along with our irreplaceable coordinator,
as the Zero Defects ad hoc committee. Their responsibility is
to prepare the ZD program and tell us how to do all of it
We are getting closer to ZD day also. We all have to begin to
get involved. Bill, I understand that you have been elected to
speak for the committee?"
"Right. a great deal about how to do ZD
We have learned
programs in the past few weeks. We made visits to three
companies that have conducted programs and we even spent
some time with a member of our corporate staff. She fixed us
up with someone over at the Watts Corporation. All in all,
we have done quite a bit of investigating."
Will interrupted. "What he is stalling around about is that
we have learned that we have been on the right track all
along. Weran into two outfits that weren't happy with their
program's results, and two that couldn't say enough good
things about it."
Kate asked, "Did you find out why it worked sometimes
and not other times?"
"Yes we did," said Will, "and I think the whole committee
agrees with me on the reasons. Marian will explain it all to
you."
Al spoke up. "I wish someone would explain something
soon. I feel like I'm being dragged behind a truck."
Marian stood up. "Not to worry. We'll take you off the
hook quickly. The whole thing is wrapped up in the word
•motivation.' The companies that weren't happy with the
results had gone program with the purpose of 'mo-
into the
do
tivating' their people, particularly those in the factory, to
better work. The ones who had crashing success went in with
202 THE DOING
the idea of communicating a work standard and the idea of
cooperating in all efforts at corrective action."
Otto raised his head. "That sounds to me like psychological
gobbledygook. Motivation is motivation. Everything you do
to get another person to do something is motivation. How
can you ignore it?"
"Oh, you don't ignore it," said Marian. "Everything just
has to be put in its proper perspective. Certainly, every hu-
man exchange involves motivation. But it involves a great
many other feelings and communications also. The problem
is that the word motivation itself has come to be thought of
as meaning an easy way of getting others to do something by
showing them posters, banners, bands, and emotion-arousing
symbols. People just aren't like that. They may get all enthu-
siastic over an event and respond for a while, but once they
determine that there is no substance behind the device, they
turn off.
"In addition, those involved in managing the program tend
to throw things out they want their people to absorb and
then return to their office to wait for the victory banquet.
"We are interested in installing the standard of Zero De-
fects into our company on a long-term basis. We want it to
be permanent. To do that, we must communicate totally and
sincerely in a manner that the people will believe and accept
as their own. You can't fool them."
"You're saying that these other companies didn't work
hard enough at the job, is that it?"
"That's it. They got caught up in the emotion of the occa-
sion and figured it would go on forever. The program does
begin on ZD day, but it's like marriage: you just being to
work at it after the celebration. Bill, tell them about ZD
day."
Bill put a chart on the holder. "What we have determined
is this. We should have several activities leading up to the ZD
day itself. One of the things we think we should do is have a
'suggestion day* about a week in advance. Every suggestion
made on how we can "make certain" our products are right
will be placed in a barrel. Then we will draw winners of some
prizes on ZD day. That just adds to the fun. And let me
make sure everyone understands that ZD day is supposed to
be a fun day. That way it will be remembered. After ZD day
we move right into goal setting, error-cause removal, and
recognition. Then we do the whole program over again, ex-
cept for ZD day as such, to make sure we are set."
THE PROGRAM 203

"You are going to supply us with the details of ZD day?"


"Yes. Wewill do it big. Pledges, and signing them; pins
and balloons; prizes for the children's poster contest; every-
thing we can think of to make sure the words 'Zero Defects'
are etched in everyone's memory. Hugh invited the corpora-
tion president, who has accepted. A
U.S. Senator is coming,
as well as the mayor and the regional president of the union.
We'll lose a little production that day, but, we will surely
transmit the message.
"The slogan we will use is HPA —growing through qual-
ity."
"All the way with HPA."
"Sounds like a fascinating day. What time will all this hap-
pen?"
Will stood. "We figure on doing it the first thing in the
morning. About a half hour into the first shift we will ask ev-
eryone to step out between the buildings. The supervisors will
have been instructed on which exits to use and given all the
details. We will have a thirty-minute program, and when ev-
eryone goes back to their workplaces, the supervisors will ask
them to sign their pledges. Of course the supervisors will
countersign.
"Hugh will be walking the celebrities around the plant and
office areas. Hopefully, they will participate in this ex-
change."
"The next day we start error-cause removal by having
forms placed around the plant as well as having one mailed
to every employee's home," said Marian. "That way we can
get them at the peak of interest After that, we will have to
do it all on a personal basis."
"Gee," said Kate, "you guys have really been digging into
this thing. I think you have gotten yourselves all excited."
"True enough," said Will. "You know, I must admit that I
didn't really recognize before that the whole business of qual-
ity and performance standards is wrapped up so much in
things being visible. I mean a visible commitment, visible
measurement, and visible corrective action. I guess we sort of
had those things in the closet for years."
"Well, they're sure going to get let out now," said Kate.
"One thing more. We're still in the awareness stage and will
be until ZD arrives. The production control guys came up
with these buttons and we have enough for everyone in the
plant. How should they be distributed? They say: Tm for
quality"
204 THE DOING
"Why
don't we just put them in bowls in the cafeteria and
let anyone who wants one take it Then we don't have to
have this down-the-line business. Anyone who would be em-
barrassed by wearing a button doesn't have to. 111 take mine
right now, though."
"OK," said Bill. "We found one more thing during our
analysis: sometimes the key people feel they understand the
concept of Zero Defects when they really don't And, of
course, it is vital that we here on the team really do because
people are going to ask. The supervisors will go through the
test* at their next training meeting.You get to take it home
with you and do it all yourself. However, if any of the an-
swers bother you, please get together with me and we'll see if
we can get the whole thing worked out."
"I must confess," said Marian, "that I missed three of the
questions when I took the test"

STEP EIGHT:
SUPERVISOR TRAINING
Purpose: To define the type of training that supervisors
need in order to actively carry out their part of the
quality improvement program.

General Operation:

The supervisor,from the board chairman down, is the


key to achieving improvement goals. The supervisor
gives the individual employees their attitudes and work
standards, whether in engineering, sales, computer pro-
gramming, or wherever. Therefore the supervisor must
be given primary consideration when laying out the pro-
gram. The departmental representatives on the task team
will be able to communicate much of the planning and
concepts to the supervisors, but individual classes are es-
sential to make sure that they properly understand and
can implement the program.
Supervisory training is divided into areas to be con-
ducted at different times:

1. At the time that quality awareness is started the su-


pervisors should be given at least six hours of instruc-

* See Step Eight: Supervisor Training" for a copy of the test


THE PROGRAM 205
tion covering the Quality Measuring system, the cost
of quality numbers, the corrective actions system, and
the purpose of the quality awareness action. This in-
struction should be well planned, and should be con-
ducted as much as possible by significant levels of
management. Everyone must attend.

2. At least four weeks before the planned Zero Defects


day, the supervisors should receive complete briefing
on the ZD
program and the error-cause-removal sys-
tem that is to follow in a few weeks. It is very impor-
tant that they be able to answer the questions of their
subordinates. Many companies prepare a handbook
for supervisors which describes the program in detail.

3. Do it over again.
Supervisor's orientation to Zero Defects

How's your Zero Defects IQ?


Do you understand the concept of ZD?
This test is to assist you in determining if you really
understand the concept of ZD. No one will know your
grade but you. Naturally, any grade less than perfect in-
dicates that you need to improve. Score 10 for each cor-
rect answer. Here's some help—the first statement is
false.

1. ZDis a worker motivation concept T F


2. ZDneeds management support. T F
3. Anyone can run a ZD program. T F
4. Errors are caused by one of three things:
lack of knowledge, lack of attention, or lack
of facilities. T F
5. A ZD program is a management communica-
tions tool. T F
6. ZD programs sometimes fail. T F
7. ZD is for manufacturing companies only. T F
8. A successful ZD program must be conducted
under the name Zero Defects. T F
9. Careful preparation is necessary before
launching a ZD program. T F
10. Award programs should give the workers
cash if possible. T F
206 THE DOING
Answers:
1. False. ZD —
not a motivation concept it is a man-
is
agement standard. It replaces the wishy-washy "let's
do it right" that leaves everyone to select an individ-
ual standard. Since we have exact standards for per-
formance in the schedule and cost areas, we need
one for quality performance. ZD is a tool for man-
agement to use in explaining its standards in a way
that cannot be misunderstood. The ZD program,
with its posters and "gimmicks," is a way of telling
the employees about the new standard. However,
the only reason you need it at all is that manage-
ment has not made its position clear previously.
2. False. ZD needs active management participation,
not just support. People judge your seriousness by
what you do more than by what you say. If the ef-
fort is left entirely to lower-level people, it will col-
lapse of its own emptiness within a year.
3. True. Any
thoughtful person can conduct a success-
ful program. All it takes is a little research and an
understanding of the particular culture of the com-
pany.
4. False. Errors are caused by two things: lack of
knowledge and lack of attention. Lack of facilities is
an error caused by one or both of these. The person
using inadequate facilities can hardly be blamed for
the errors unless that person selected the facility.
Planners and staff people must be held responsible
for their contribution to the error pot
5. True. ZD creates an attitude of defect prevention. In
this environment it is possible to use the error-
cause-removal system or other communication
devices to let employees express their problems with-
out necessarily knowing the solutions. Relationships
between management and employees grow stronger,
and as that happens understanding of mutual prob-
lems develops.
6. True. However, they always fail for the same rea-
son: They are given short shrift by management. In
these cases the managers felt that if a few banners
were waved, everything would "get right."
7. False. All businesses are "manufacturing" in that
they have processes or procedures that they are sup-
THE PROGRAM 207
posed to execute. The attitude of defect prevention
pays off in all of them.
8. True. Zero Defects is a standard. "Do better work,"
"excellence in effort," and any of the many other
motivation slogans beg the issue. People get to deter-
mine their own standards in the quality awareness
programs that are an introduction to ZD. But there
is no substitute for the words "Zero Defects." They
are absolutely clear.
9. True. Careful preparation is needed before
launching any management program. Many man-
agers claim to be disappointed with the performance
of their computers. However, the machines don't
make mistakes. The errors are caused by ill-defined
and ill-executed programs or poorly trained in-
formation input people.
10. False. Awards, or recognition, need to be whatever
it takes to convince people that you are genuinely

pleased with their performance. If it requires money


in your situation, then you should look to your in-
dustrial relations program. People work for appreci-
ation and recognition —
once they have a basic
living. Awards should be given with dignity and re-
spect; their monetary value is not significant. Don't
forget to give some to management, too.

Your score

STEP NINE?
ZD DAY
Purposes To create an event that will let all employees
realize through a personal experience, that there has
been a change.

General Operation:

Zero Defects is a revelation to all involved that they are


embarking on a new way of corporate life. Working un-
der this discipline requires personal commitments and
understanding. Therefore it is necessary that all mem-
bers of the company participate in an experience that
will make them aware of this change.

Specific Points: If possible, all employees should be ori-


.

208 THE DOING


ented at the same time by people who are significant to
the employees. Some companies have taken their person-
nel to the local stadium; or have brought everyone to-
gether out in front of the plant. A
few have used
closed-circuit television.
Face to face is best Don't be afraid to use a little
show business in the meeting. There is nothing wrong
with fun and celebration on such a grand day.

Quality improvement team coordinators grow impervious


to the routine disasters of life. Dealing with a diverse group
of managers on a daily basis, coordinators learn patience, di-
plomacy, and humility. They also learn when to be hard-
nosed and how to improvise. Resourcefulness is the most
valuable characteristic of a coordinator.
However, there is one factor guaranteed to make a nervous
wreck out of the most disciplined coordinator: weather. The
platform is set up for the dignitaries, the public address sys-
tem has been tested, the entire population of the plant is

scheduled to appear in front of the podium at exactly 8:15


a.m. and ... it looks like rain.

As random drops plopped on Bill's upturned face, he saw


Hugh approaching the platform with the corporate president,
Mr. Williams, Senator Ashbrook, and Mayor Brook in tow.
In about thirty-five seconds Hugh was going to say, "What do
you think, Bill? Are we going to go ahead with it?" And Bill
would have to answer something. Would it rain, or wouldn't
it? (Don't rain on my parade, he prayed)
The group reached him and Hugh introduced the guests.
Mr. Williams smiled at the obviously worried young man.
"Don't worry about the weather, Bill, I personally guarantee
it won't rain for at least an hour. Let's get on with the pro-

gram. It never rains on a Zero Defects day."


Feeling better but no braver, Bill signaled for the program
to begin. "Happy days are here again" (the best idea they
could come up with) began to play over the PA system, and
at this signal the supervisors urged their people to the meet-
ing area between the buildings. Mr. Williams stood in the
middle of the assembly area shaking hands with those who
came his way. This was partly his own idea, but in the main
he was following the lead of the Senator, who admitted later
THE PROGRAM 209

that something just happens to him when he sees a crowd and


hears assembly music.
"Just can't stop from shaking hands and saying hello to
folks."
Hugh welcomed the employees to the gathering and, after
the Mayor had spoken, introduced Mr. Williams as the cor-
poration president. Williams, a medium-sized, slightly portly,
effervescent person, put the crowd at ease immediately with a
few light-hearted stories before getting to the heart of the
matter.
"The most important thing we have to sell is quality. Ev-
eryone in the business can purchase the same components,
designs, and packaging. Everyone can make the product for
the same price that we can and in some cases a little less.
The only thing we have going for us is the dedication of this
group assembled here (applause) and the reputation for qual-
ity we are trying to create. The best way to create that repu-
tation is to perform. Zero Defects to me is not an abstract
goal; it is a fact of life, and an attainable fact of life. I don't
see why we should expect to give our consumers any less
than we tell them they are going to get. We want to give our
customers products that do the job and do it every time. We
will spend every cent we need to make that happen —
but not
one cent for waste (applause). Now I'd like to introduce Sen-
ator Ashbrook, who has promised not to make a campaign
speech."
The Senator walked across the stage waving.
"Not only am I not going to make a campaign speech,
Sam, I'm not going to make a speech at all. I want all of you
to remember me for something pleasant. And the most
pleasant job I could lay hands on today was awarding the
suggestion prizes. But before I do that, I want you to know
that I have given your president a check, out of my own
pocket, for one of your electric skillets. This skillet, to be
taken out of inventory next week, will be shipped to the
White House as a present from me to the President of the
United States to use in making his breakfast I am going to
send him a note saying that he is going to receive a Zero De-
fects skillet."
Bill brought the suggestion blank barrel to the Senator,
who drew from it and announced the winners. The
six slips
individuals happily mounted the platform to receive their
prizes and to decline to say anything into the microphone. All
except Ethyl Tibbits, who said, "I work on the skillet line and
210 THE DOING
Fm telling you, Senator, you don't have to worry about that
gift for the President. It'll make everything hot for him every

morning."
Then Mr. Williams introduced the international director
for the union, Wilson Nelson, who had arrived a little late
and slipped onto the platform quietly.
"Wilson and I" said Mr. Williams, started out in business
about the same time. We have known each other for many
years. Every time he gets a promotion I get one. He took one
side of the management system, I took the other side. I've al-
ways been proud to consider him a friend, although there
were times when I thought he should have been wearing a
mask and cartridge belt instead of a business suit Wilson
Nelson."
Nelson directed a few bantering remarks to Williams and
then concentrated on the matter at hand. "I want to say just
a few things before the rain begins. First, the union at every
level is behind quality improvement. To us, Zero Defects is a
practical, attainable thing. As the company grows through
quality, we will grow also.
"Second, I would like to saysomething that goes a bit be-
yond my feelings about the union and quality improvement
through Zero Defects. We American labor now face a
in
great opportunity to expand the markets of our nation. For
the first time it is now more expensive to manufacture in
many foreign countries than in the United States. Much of
this improvement has come about through increased produc-
tivity in labor in the United States, and some from increased
capital spending by industry. But most has been accomplished
by the effect of inflation in the industrialized nations of Eu-
rope and the Far East We
can offer work of higher quality
at a lower total price now, and it is time to take advantage of
it"
After the applause died down, Hugh spoke for a few mo-
ments to express his thanks to the visitors and to the employ-
ees. He reminded everyone that they would be given the
opportunity to sign their ZD pledges with their supervisors
and receive their pins. He asked them to be sure and make
certain they understood the program and assured them that it
was not just a passing fad.
"Tomorrow we start the error-cause-removal phase. And it
will be with us as long as we feel the need to communicate,
which should be forever. You state the problem you have in
THE PROGRAM 211

getting the job done right the first time, and it's my job to
make sure that your problem gets corrected.
'Thank you all for coming out here. Now I think if we
walk briskly back in, we will just beat the rain."
Williams, Wilson, and the beaming political leaders made
their way through the administrative areas then the shops,
following Hugh and Bill, Many people asked the president to
countersign their commitment, which he did with pleasure.
Bill was beginning to get a little lightheaded with all the at-
tention and with relief from having a successful rally. If
nothing else, he had been given the personal top-level ex-
posure he had been promised. This job really was a good op-
portunity. He had to make sure that he carried it all
out—with Zero Defects, by golly.
At the end of the day Hugh invited the quality improve-
ment team out to dinner with their spouses. After making a
brief comment of thanks and appreciation for the extra effort
they had shown so far, and reminding them of the job ahead,
he presented each member of the team with a framed com-
mitment sheet countersigned by all the honored guests. And
he gave the chairperson's husband a special gift: a photo-
graph of a disheveled and windblown Kate Norton helping
hang the "Do It Right the First Time" banner across the
front of the plant.
It was a good-feeling day.

Sharon handed Bill a cup of coffee.


"Now that ZD day is over," she said, "do you feel the
whole thing was worth it? I know that you had some personal
reservations about the business of bringing everyone together
for having speeches, music, and pizzazz."
"You're right," nodded Bill. "I really wasn't sure that it
was properly dignified or within the relationship of manage-
ment and employees. I guess I felt like the employees
wouldn't take it seriously. However, now that it's over, I
think it was a great thing to do."
"You liked it because it let everyone have a chance to ex-
perience something different, or what?"
"Yes, I think the main thing is that the occasion let every-
one share a common experience. Here we have all these
people who work in the same company. Every day they come
to work and every day they leave. They see only a small per-
212 THE DOING
centage of their fellow workers, and they certainly speak to
far fewer than they see. Now they all have something to talk
about, something they did together. Their friends and neigh-
bors haven't had that opportunity.
"It was a party like Christmas. It was an event, a happen-
ing."
"Happening is a good phrase,'* said Sharon. "I think I know
what you mean now. They all have a common benchmark to
share. Also, they got to meet some interesting people."
"And the concept of ZD is really socked into everyone for
good. Even those who make fun of it have to say the words.
They'll all come around. Although I must say I haven't heard
anyone say anything against the idea. A
few just question
whether or not it can really happen."
"The program will need you for a while yet. Do you think
this assignment was good for your career?"
Bill smiled. "I don't see how it could have been better. I
have had the chance to work very closely with a management
level that I would not have been exposed to for several years.
I found out that there is nothing mysterious about the go-
ings-on there; it is just a matter of learning the facts and
making a judgment based on experience. And they learn very
quickly. I also noticed that they are all very polite to each
other, even when they are disagreeing."
Sharon winked. "That's a good idea for marriages too.
How about some more coffee?"

STEP TEN:
GOAL SETTING
Purpose: To turn pledges and commitments into action
by encouraging individuals to establish improvement
goals for themselves and their groups.

Genera! Operation:

About a week after ZD


day, the individual supervisors
should ask their people what kind of goals they should
set for themselves. Try to get two goals from each area.
These goals should be specific and measurable. For ex-
ample, two possibilities are:

• Reduce defects per unit 20 percent in one month.

• Win the good housekeeping award next week.


THE PROGRAM 213

Stay away from schedule improvement goals in associa-


tion with ZD; the schedule will automatically improve as
the defects reduce. (Zero delinquencies.)

Specific Points: Goal setting is most effective when it is


done by the personnel themselves rather than established
by the supervisor. However, the supervisor should have
some idea of what he or she wants before talking to the
people.

Comment: Don't people settle for easy tasks. Post


let
the goals in a conspicuous place. Make a big fuss over

any group that improves progress is a start.

Carl Albert and his group settled around the table; they
were getting comfortable with each other now that the meet-
ings were occurring regularly.
"Today," said Carl, "we are supposed to discuss the setting
of goals. I have a little notice here that explains what goals
are and aren't. Suppose I read it before we begin thinking
about it."
Nobody said anything, so he read: "Goal setting is when a
group decides what achievement they are going to strive to
make as a team and then picks the measurement that reflects
it."
Everett Smith said, "That means we have to pick out what
we're going to do in advance."
"You should write these things Ev; you say it clearer."
Carl continued. "Goal setting is not the establishing of a
quota or an achievement that the group's performance will be
measured against."
Martha giggled. "That's to make sure you won't think that
it's like those countries where if you don't meet the quota, you

get sent to the cold place."


Carl laid the instruction down. "What sort of goal should
we pick? Our defects rate per harness measurement has
dropped from 5.6 to 4.2 over the past month. Should we try
to get it lower?"
"I think we can go a lot lower, Carl. Now that we get to
do our own rework, and know what problems we are hav»r>^
and now that the wires are going to be changed to different
colors on the power line, I'll bet there will be a big improve-
ment."
"What does everyone else think?"
"I'll bet we could drop it down to two defects per harness
214 THE DOING
by another three months and maybe less by the end of the
year," Sally stated.
Carl shook his head. "That's better than a 50 percent re-
duction. Do you really think we could do that?"
"Why not?" said Martha. "I'd like to bet that we could
have the best improvement record of any group in the plant
if we really went after it. And we really don't have anything
else to do except that, now do we?"
Ev raised his hand.
"I've got an idea. I think the measurement is wrong. A
month or even a week is a long time to concentrate on a
goal. I've got a cousin who was a compulsive gambler. He fi-
nally quit by learning how to get through one day at a time
by not gambling that day. Just concentrating on one day."
"How about one hour?" asked Sally.
"How do you mean?"
"Suppose we said that we were going to have ZD for so
many hours and then challenge some other group, anywhere
in the plant, to beat us? Now that would be something."
Carl looked at her. The group was getting excited. "You
mean instead of setting goals based on these charts, we would
just set up a goal of say twenty hours with no defects and
then let anyone else try to beat it? We'd have to set a goal on
the big chart too."
"O.K monthly goal of two defects per harness
Let's set a
on the measurement chart. But let's get the inspection people
to report every hour. I have a big blackboard at home and
I'll bring it in tomorrow morning. We'll write 'group work

hours with Zero Defects' on the board and let the inspectors
keep it up."
Carl leaned back. "You folks are something else. Let's do
it. I'll make sure the rest of the plant knows they are chal-
lenged."
took the harness group thirteen work days to get through
It
a complete eight-hour day without an error. After that six-
teen to twenty-five defect-free hour periods became routine.
Other groups tried the same method, and Bill ran happily
around the plant spreading the news of how the goal setting
and meetings were progressing. Engineering, accounting, cafe-
teria —
all areas participated.
The measurement charts reflected the overall decrease. In-
plant rework costs had dropped 73 percent since the program
started. Field rework was dropping more slowly, since much
of the finished goods inventory had been placed there prior to
THE PROGRAM 215

the start of the improvement program and it was contami-


nating the effort.
Hugh, taking a chance on his balance sheet, recalled as
much as he could of that inventory and set up a special re-
view and rework operation to clean it up. That meant that
new products went directly to the dealers. Their reaction was
spectacular. Products that worked made them happy. They
appreciated it. "Defects per hour" became a standard
measurement. Everyone liked it except the inspection func-
tion, and they never admit to liking anything.
Carl and his group were singled out for special recogni-
tion: Theirs was the only operation in the plant permitted to
have a gold-painted border on their blackboard.

STEP ELEVEN:
ERROR-CAUSE REMOVAL
Purpose: To give the individual employee a method of
communicating to management the situations that make
it difficult for the employee to meet the pledge to im-

prove.

General Operation:

One of the most problems employees face is


difficult
their inability to communicate problems to management.
Sometimes they just put up with problems because they
do not consider them important enough to bother the su-
pervisor. Sometimes supervisors just don't listen anyway.
Suggestion programs are some help, but in a suggestion
program the worker is required to know the problem
and also propose a solution. Error-cause removal (ECR)
is set up on the basis that the worker need only recog-

nize the problem. When the worker has stated the prob-
lem, the proper department in the plant can look into it.
Studies of ECR programs show that over 90 percent of
the items submitted are acted upon, and fully 75 percent
can be handled at the first level of supervision. The num-
ber of ECRs money is extremely high, since
that save
the worker generates savings every time the job is done
better or quicker.

Specific Points: Simple one-pageforms are supplied to


each area, usually in wall boxes. When an employee
216 THE DOING
feels that there is a problem, he or she completes the
form and drops it in the box.
InECR there are only a few rules:
1. Everyone who submits an ECR gets a personal
thank-you note immediately. The form is forwarded to
the department that has the responsibility for the
problem area. An acknowledgement statement is sent
to whoever submitted the ECR when something is de-
cided about it.

2. Every ECR is to be taken seriously.


3. If you decide to do nothing about an ECR, clear
your decision with at least one and preferably two
levels of supervision.

There are always people who are afraid that doing


a program like ECR will cause a lot of internal trouble
because people might write abusive things when they
have the chance to address notes to management. Yet it
hasn't happened that way. It is like the fear of union
reaction. Unions always suppport ZD programs because if
nothing else the programs focus attention on the work-
ers.

To stimulate theECR activity at HPA Bill decided to draw


a winner at random each week. The number one parking spot

was marked as ECR winner reserved. Hugh moved to num-
ber two and someone fell off the end. This was received with
a good spirit in the plant. Parking was always a problem.
During the first week of the ECR program, 117 ECRs
were received. During the first month a total of 385 were put
in. That made a terrific load, but it was found that a few

were redundant, and most of them could be handled at the


first line of supervision. But all were positive. Absolutely no

negative ECRs were received. The quick responses created


credibility for the program and still more ECRs poured in.
Some of the ECRs received early in the HPA program
were as follows:

• I can't lift the skillet handle tote-box to my workbench.


It must weigh 25 pounds. The paint gets chipped when
they drop.
• There isn't enough light for me to read the instruments
properly. Sometimes I have to guess.
THE PROGRAM 217

• My screwdriver is so short I can't really tighten the screw.


• The typewriter ribbons are all bought from different
sources. If one quits in the middle of a report, you have
to start all over again because the new color won't match
the old.
• The accounts payable forms sent to us by the field service
operations are so hard to read we have to telephone
about most of them.
• Every time run out of machining oil I have to shut
I
everything down and walk clear over to the other building
for a can. Why can't we have more over here?
• Why do they have to sweep the machine shop during my
lunch time?
• We have a lot of bulbs burning up in top of the high
bay area. There is nothing to see up there and they don't
help light the floor, so how come they are up there?
• I keep catching the harness wire on my chair because it

has to drag on the floor. This nicks the insulation.


• Because people aren't allowed to smoke in the harness
area they spend a lot of time in the bathrooms smoking.
• Why do we make up all the TV box labels in advance
with the color printed on them? Why not just put some
stamp at the load point and let the person who puts it in
the box stamp the color on the outside?
• I spend most of Monday waiting for the melt furnace to
heat up to requirements. Could it be lighted on Sunday
night?
• It isvery hard to read our schematic drawings. Do they
have to be so small?
• My solder iron is worn out, and I can't get a new one.
• The toaster coils are allpacked loose, and it takes me a
lot of searching to find the ones that aren't damaged.
• I get shocked by my test set now and then.
every
• It is hard to open the wooden boxes we receive because
we have no right tools.
• We are checking transistors one at a time when there
are machines that can do it a thousand a minute.
• I am trying to write computer programs and sitting right
next to the noisy keypunch area. The two just don't go
together.
• It is hard to adjust the back of a TV set and lean for-
ward to see the tube. I could use a mirror like they have
on final test.
218 THE DOING
• Everytime I get all set to do a delicate job the plant pag-
ing system shouts off. I think we should get rid of it.
• I need a quicker feedback on how well I'm doing my
work.
• The milk in the cafeteria is not fresh.

STEP TWELVE:
RECOGNITION
Purposes To appreciate those who participate.

General Operation

People really don't work for money. They go to work


for it, but once the salary has been established, their

concern is appreciation. Recognize their contribution


publicly and noisily, but don't demean them by applying
a price tag to everything.
Supervisors are very concerned about getting people
to work better. By this they mean that they want their

employees to put forth a little extra particularly in the
areas of output, quality, and efficiency. Recognition
must be given for achieving specific goals worked out in
advance, and the employees must have the opportunity
to help select the goals.
The contest and the measurement are the key. The
prize not significant. It only matters that all of an in-
is

dividual's contemporaries know that he or she has


fought the good fight and won.
Above all, individualsmust know that management
seriously needs their help and sincerely appreciates it.

Kate seemed angry. "So far we've gone through this whole
program, somehow agreeing on everything. How come we get
into this crack when it comes to recognition? It seems to me
to be a very simple thing."
"Not to me," said Otto. "I just don't believe you are going
to get people to take you seriously unless you give awards
that are worthwhile. Savings bonds and vacation trips and
things like that. I would think that being in marketing you
would know that these are the things that turn people on."
Al patted Otto on the shoulder. "Honestly, Otto, Kate's
right. People just want an honest appreciation. Now in some
cases the only way they will believe you are sincere about the
THE PROGRAM 219

recognition is if you spend a lot of money, but I think the


relationships around this plant are not that way. I think we
should stick to group lunches with Hugh and the giving of
performance plaques."
"I gave my guys a plaque once and they didn't think it was
such a big deal."
Will glowered at Otto. "Yeah, you tossed it on one of their
desks and said something about the person winning first prize
in the beauty contest. How did you expect them to take it
seriously when you didn't?"
Otto blushed. "Well, I admit I didn't handle that one quite
right. But I still think we need something more . . . well,
valuable."
Kate thumped the table. "Valuable is as valuable does. I
think we need to concentrate more on the dignity of the
presentation than on what the awards are. Now let's all calm
down and get ourselves straight. Bill, you have been studying
the situation. What have you found?"
"I think what you just said is right, Kate. The manner of
presentation is what counts. The most important factor in
recognition seems to be that everyone should know about it.
The award itself doesn't have to be too much, although it
should be something worth showing. Also, we don't need too
many different types of awards, just a few basic things. I
recommend that we consider setting up a formal system of
recognition based on three things: groups meeting their
short-range goals, individuals making outstanding contribu-
tions, and random drawings of ECRs submitted. That way
you have group, spiritual, and random recognition.
"We should make quarterly awards for individuals, month-
ly for the groups, and whenever we feel like it for the
drawings."
Otto nodded. "I guess that's OK. But if you won't put
more substance in the award itself, how about having most of
them presented by the vice president instead of just one of
us?"
"I agree on where appropriate. We could have a quar-
that
terly awards dinner and then a big deal once a year," said
Bill.
"Also," said Kate, "I would like Bill to pick a committee
of, say, threeshop people, two administrative personnel, the
union president, Otto, and probably Marian to select the
awards themselves. And I'd like to see complete agreement
on the whole thing before we go on."
220 THE DOING
"All right," said BUI, "I'll do it. Well have a report next
week. Also, I'd like to point out that one manager who does
a great job with recognition awards is Al. Even though he's
my boss, I have to say that his method is unique. He bets his
people cigars or candy bars that they can't meet their goals.
When a guy bets Al and gets his cigar, he never smokes it.
He wears it."
"I'll have to be careful what I bet him," smiled Kate.

STEP THIRTEEN:
QUALITY COUNCILS
Purpose: To bring together the professional quality
people for planned communication on a regular basis.

General Operation

It is vitalfor the professional quality people of an or-


ganization to meet regularly just to share their problems,
feelings, and experiences with each other. Primarily con-
cerned with measurement and reporting, isolated even in
the midst of many fellow workers, it is easy for them to
become influenced by the urgency of activity in their
work areas.
Consistency of attitude and purpose is the essential
personal characteristic of one who evaluates another's
work. This is not only because of the importance of the
work itself but because those who submit work uncon-
sciously draw a great deal of their performance standard
from the professional evaluatcr.
So bring the quality control people together regu-
larly. Let them ask their own questions, and expose them
to other members of management. Do everything in a
formal manner.
In multiplant operations the worth of interchange
becomes even more apparent. Councils should select
their own chairmen, create their own agenda, and deter-
mine their own meeting times. Free exchange brings
growth. Membership should not be restricted by the or-
ganizational rank of the professional.
THE PROGRAM 221

STEP FOURTEEN:
DO IT OVER AGAIN
Purpose: To emphasize that the quality improvement
program never ends.

General Operation:

There is always a great sigh of relief when goals are

reached. If you are not careful, the entire program will


end at that moment. It is necessary to construct a new
team, and to let them begin again and create their own
communications.

Hugh read the telegram from the corporate president con-


gratulating them on the achievements of the quality program.
"What he doesn't know yet is that our cost of quality is
now on an 8 percent of sales annualized rate. That is remark-
able. I see no reason why it won't drop even more."
Alice nodded. "It isn't all real money yet, chief, but it is
getting realer every day. I think we will be showing a signifi-
cant profit increase this next quarter."
"Alice, you know damned well you be showing a sig-
will
nificant profit increase next quarter. But I understand why
you have to be conservative about stating it now.
"At any rate, we have been given approval from headquar-
ters to set up the new clock-radio and 20-inch TV lines. That
will absorb most of the people we can transfer, since the re-
work has been reduced so much."
Kate smiled. "I want to get a chance to say something be-
fore you all faint from congratulating yourselves on this
achievement."
"Go ahead. You have earned the right to say whatever you
want. It is all your fault that we're being so successful."
"That's what I want to talk about. Now the last step of the
program is 'do it all over again.' And that's what it really
means. So I think that what we have to do is set up a new
team, a new leader, and a new coordinator, and get going on
doing the program all over again. That way we can make
sure that we will get to keep these gains."
Hugh paused. "I hadn't thought about it in that manner.
Do you literally mean do the whole thing over again? Exactly
like we did it before?"
222 THE DOING
Kate shook her head,
"No, not exactly like we did it before. It will take a lot
more innovation and thought this time than last. I think the
program should be scheduled out over a full year. We can

have ZD II on the anniversary of ZD day a rededication to
the efforts. We can have a quality hall of fame, a lot of
things. But I think it has to be done.
"All us old warhorses should be dropped from the team,
except Al, and he can serve as a sort of 'godfather5 to it. Bill
Ranson should be given a nice promotion, a letter of recogni-
tion should be sent to corporate headquarters, and a new ad-
ministrator appointed. Then every eighteen months or so we
should have a new team. Perhaps some of us should be put
back on after a time or two."
Hugh smiled. "You know, Kate, I really had never thought
of this repeat in that way. But you are absolutely correct.
Anyone have any comments on Kate's remarks?"
"I agree wholeheartedly," said Marian, "and I see it also as
a management development tool. It will let us search out
young people and give them a positive exposure in creative
management."
Evervone agreed with the concept as outlined by Kate.
Will Ellis added the warning that each of them should re-
frain from directing their departmental representative too
much so that there would be the opportunity to introduce
new ideas and techniques into the program.
"OK," said Hugh, "so be it. Now each of you should give
me the name of your department's representative on the new
team. Al, you pick the new coordinator. I will meet with Al
and the new team next week. We'll pretend we never had a
program at all and just concentrate on getting that cost of
quality down to 2 percent.
"Now I am going to give each of you an Al Fielding cigar
in appreciation of your work on this team. The meeting is
dismissed."

The new team decided to make its impact quickly by


launching the Make Certain five-week program. The program
concept and content are given in detail in Part Three.
Porfi Three
THE TOOLS

The reader may decide to utilize the HPA


case as a teaching
tool, or use it as a way to develop a greater understanding of
the concepts and methods involved in a quality improvement
operation. Part three contains an instructor's guide that leads
you through the HPA
case step by step. It is set up so you
can encourage class participation by having students take the
roles of the HPA
staff.

The Make Certain program is described in detail so you


can utilize it as part of your quality improvement program.
Aimed primarily at white-collar personnel, Make Certain is a
breakthrough in quality improvement efforts. It is very appro-
priate for use in the awareness step of the overall program.
12
Guide for
Instructor's
HPA Quality Improvement
Program Case History

The HPAcase history details the creation and installation of


a quality improvement program according to the fourteen-
step program. The purpose of the case study is to provide a
common and interesting basis for students to discuss the phi-
losophy and actions of implementing the program. The In-
structor's Guide is included in the following pages. Using this
guide you will be able to lead the students as they develop
their understanding of the logic and method of the program.
The following are the action steps for teaching the quality
improvement case history.

1. Send the book to the students so they receive it a week


prior to the beginning of the course. Attach a personal
note asking the student to read the case and prepare any
questions he or she might have concerning any part of
it. The student is to bring the book to all meetings be-

cause it will serve as a key part of the course.


2. When the students arrive and are oriented, explain to
them —very —
clearly that they have been sent there by
their management at considerable expense for the purpose
of learning how to install a quality improvement pro-
gram in their operation. This sending and paying should
serve as tangible evidence to them that their manage-
ment expects them to install the fourteen-step program
completely on their return. Anyone not interested in
225
226 THE TOOLS
undertaking that assignment should not stick around.
Emphasize that this is a gathering of select professionals
and that you are pleased to be involved.
3. State that you will make sure that the content of the
case is fully understood by discussing it step by step. Try
to let students talk as much as possible interrupting only
to provide another question or to keep the discussion on
track. (See the section on Step-by-Step Discussion Items
at the end of this chapter.) The purpose is to let the
students bring to the surface every possible question or
problem they might face in their operation and get it
resolved. It should take about twelve class hours to
completely cover the case, including the Make Certain
assignment
4. Group assignments can be given for the measurement,
quality awareness, ZD planning. ZD day, and recogni-
tion steps. Special presentations by the groups (no more
than two for each subject) will make the information
flow more easily. Also, student participation makes the
course more interesting to them.
When the HPA quality improvement team in the case
has a meeting, it is a good idea to have your students

take the roles assigned and read the dialogue out loud.
That way they get to hear it as well as read it.
5. When you are satisfied that they have an understanding
of the Make Certain program, divide them into teams
and asl that they develop the Make Certain program for
presentation the next day. This will give them something
to take home.
6. During the discussion it is reasonable to assign groups
to tackle individual steps and report back to the class
the next morning or even after lunch or breaks.
7. When the course ends, notify the students that you expect
them to send you progress reports on their success.

The following are discussion subjects and notes for each step.

HISTORY OF THE PROJECT


1. HPA seems to have a lot of "trouble bubbles" pop-
ping to the surface. Everyone is working hard but
(he events still occur. Have you seen situations like
this?

Note: The idea here is to get them to talk a little


about the problems they have had or seen, and to
break the ice. Everyone has trouble and likes to dis-
instructor's guide 227

cuss it. Try to steer the items around to the need for
a better way.

2. The manager mentioned the need for


field service
prevention. This seemed to surprise Hugh. Do you
suppose no one had ever thought of that before? If
they had, how come no one did anything?
Note: They had probably thought of it but they
were so concerned with day-to-day things that they
hadn't felt it possible to get around to prevention
just yet. They did not know how to go about start-
ing to prevent. (This is a very key point because
the whole reason for the course is to teach them
how to go about starting to prevent.)
3. The manager obviously knew what Hugh
quality
meant, and he was prepared with a plan for starting
quality improvement. Why hadn't he mentioned this
before?
Note: Here the message we have to instill is that
the quality manager didn't know how to sell the
need for prevention because he didn't understand
the quality improvement program or how to market
it.

4. Al was very determined to make certain that Hugh


didn't get the idea that this was going to be a mo-
tivation program. Why? Isn't quality improvement
motivation?
Note: This should generate a lot of discussion.
However, we have to recognize that although every
human communication involves motivation, motiva-
tion is short-term in effect. What we are after is to
install a long-range, permanent attitude a change—
in discipline.This requires management action of
the most deliberate and planned sort. Using the
word "motivation" implies that there will be some-
thing emotional about people's involvement. This
program is not emotional.
5. The Zero Defects concept sounds so easy to under-
stand that sometimes we overlook it. Let's examine
it closely. For instance, why
aren't lack of facilities
228 THE TOOLS
or wrong tools considered acceptable causes of mis-
takes, as attention and knowledge are?
Note: Here the intent is to make clear that some*
one assigns the wrong facilities or tools to a particu-
lar job because of lack of attention or knowledge. If
you say that facility problems are the only cause of
defects, you make the concept of improvement
strictly a blue-collar program involving better work
standards. Remark that there is a ZD test later.

6. Why isn't an "acceptable quality level" a good man-


agement standard? Aren't we in the quality manage-
ment business the ones who caused it to be used as
a standard?
Note: See if the class can identify some other
wrong standards used —
like years spent in
in life
college as an indication of smartness, or lights on
the telephone as a determination of importance.

7. Hugh's wife told him he didn't think the program


was complicated enough. He admitted that the "sim-
plicity and directness" bothered him. He was actu-
embarrassed that he hadn't thought of
ally a little
doing something like this before. Why hadn't he?
Note: He has a lot of things to do. It is up to his
subordinates to come up with programs like this.

The quality manager has been stalling because he


didn
y
t really know how to set up such a program.

STEP-BY-STEP DISCUSSION ITEMS

Step One: Management Commitment


1. The text says that the quality policy is too important
to leave up to the quality manager. Is that correct?
Isn't the quality department responsible for quality?
Note: Make the point that the quality department
isresponsible for measuring and reporting the status
9
of quality. "Quality means conformance ' will be
discussed later, but since quality doesn't purchase,
manufacture, or design, or do other productive
things like that, they can hardly be held responsible
for performing these functions.
instructor's guide 229

2. How can it be that there is no "economics of qual-


ity"? We hear this term all the time.

Note: We do not encourage managers to use


quality as a catchall word meaning "goodness"
They have to specify exactly what they want in
terms of luxury, beauty, etc. Therefore, quality
means conformance and always cheaper to do
it is

the job right the first time. Ask for an example in


which it is cheaper to do the job right the second
time.

3. How many of the students have published a policy


in their company? Does it give anyone a problem?
If so, who and why? How did it all turn out?

Note: If possible bring the discussion around to


why nothing should be added to the policy to mod"
ify it —
such as Hugh considered.

4. What would it take on the part of the general man-

ager to convince the quality department people that


he or she was serious about quality improvement?
Note: After discussion of this, ask students to
make a note of what they would have to ask their
boss to do to get this point across.

Step Two: The Quality Improvement Team


1. Why is it recommended that the chairperson not be
the quality manager? It would seem that this would
be a vital part of the quality manager's job.
Note: The quality manager must be the driving
force behind the program, the brains, and the in-
formation source. However, the manager must get a
team together, hopefully under another chairperson,
to run the program. Otherwise it really will be "just
another quality program."

2. Who would you select as the administrator of your


program? What are the most valuable characteristics
for an administrator to have?

Note: The key qualities are ability to communicate,


genuine ambition, and the ability to hold up under
stress.
230 THE TOOLS
3. If we figured out how your company disposes of the
sales dollars it same distribu-
receives, following the
tion Hugh did, how would it break down? What are
the sales per employee of your company? What is
the after-tax profit?

Note: If the students don't know these figures,


they are not taking a proper interest in their com-
pany. And what is more important they probably
aren't communicating properly with the rest of the
staff.

4. Do you believe that 25 percent of the people spend


time doing the jobs over again in the administrative
and paperwork areas? What does this mean?
Note: This is the time to get them interested in

the white-collar problems. This interest is essential


for preparing Make Certain.

5. Have you ever thought about how you are paying


for the cost of quality in your suppliers' plants?

6. If you gave the ten-question test (see the end of this


section) to your fellow managers in your company,
how would out? Do you think their level
they make
of information any better than that of the HPA
is

management team?
Note: This is the time to convince your managers
that they have to do a quality orientation program
when they get back home. In fact, it is a good time
to get the commitment from them.

1. Why is adhering to the principle that "quality means


conformance" important to your job?
Note: important because it is very hard to
It is

make a living out of "beauty, truth, and luxury"


You need something that is measurable.
8. Let's discuss the individual questions and answers in
the attitude test. We
need to make sure that we have
an understanding that is accurate. How would your
staff do with the test?

Note: Take the time to go over each question


and really discuss it. You have to get all the reserva-
instructor's guide 231

tions out in the open at this time. Otherwise the rest


of the case will not compute.

9. HPA picked Kate to be the program manager.


Whom would you pick in your company? Why?
Note: It is not necessary to identify a person in
each company, but if you can get several of the
students to discuss their choices, the results will be
beneficial.

10. Does everyone know how the quality councils work?


Do you have one in your operation? How do you
communicate with each other in your quality func-
tion?

Note: The information gained in quality council


meetings should be distributed within the company.

11. Do you think your general manager would make a


speech like Hugh did?
Note: The general manager will if asked to do it.

Has their general manager ever been asked?


12. Do you think the meeting with the union manage-
ment is typical?Would you expect it to be a prob-
lem?
Note: We know of no case where a union did
anything but cooperate wholeheartedly with the im-
provement program.
13. Why is so much
written here about the difference
between a concept and a technique?
Note: It is important that people concentrate on
the intent of the concept rather than on dotting the
fs in each point in the program. There is no infalli-
ble, unchangeable way to install a program; it has to
be done with daily thought and understanding. The
firstpersonal step is realizing that all the steps we
are studying relate to each other like all the parts of
a cat relate to the whole cat. Encourage them to dis-
cuss this at length.
232 THE TOOLS

The question on quality

1. Quality is a measure of goodness of the product that


can be defined as fair, good, excellent.
False. Quality means conformance to the require-
ments, and that is all it means. If you start confusing
quality with elegance, brightness, dignity, love or
something else, you will find that everyone has dif-
ferent ideas. Don't talk about poor quality or high
quality. Talk about conformance and noncon-
formance. If you don't like the requirements, get
them changed officially. If you don't take this atti-
tude and stick to it, everyone gets to set his or her
own standards, and the last person in the line de-
termines what gets out of the door.

2. The economics of quality requires that management


establish acceptable quality levels as performance
standards.

False. Thereis no such thing as economics of


quality. It isalways cheaper to do the job right the
first time. Many companies confuse their people by
using the sampling inspection criteria of acceptable
quality levels as performance standards. As a result,
each operation takes its 1 percent. The only proper
standard is Zero Defects. Why settle for less? People
work to the standards you give them.
3. The cost of quality is the expense of doing things
wrong.
True. Quality is free. It's nonconformance that
wastes the assets.

4. Inspection and test should report to manufacturing


so manufacturing can have the proper tools to do
the job.

False. If you assign the inspection and test re-


sponsibility to manufacturing, you will not have ac-
curate recording of defects. More important, the
personnel involved will not receive the training, dis-
cipline, and appreciation that they need. Inspectors
who work for manufacturing managers become sort-
ers and expeditors. In addition, since the quality
instructor's guide 233

control people check after the inspectors, they will


miss about 10 percent of the defects. An inspector is
not effective unless the inspection is the last oper-
ation in the line. If you really believe that manufac-
turing needs the tools to do the job, then give it
the comptroller, public relations, purchasing, and
payroll functions, too. Then you will have a bunch
of little general managers in your plant.

5. Quality is the responsibilty of the quality depart-


ment
False. Proper quality departments are supposed to
measure and report conformance, demand corrective
action, encourage defect prevention, teach quality
improvement, and act as the conscience of the oper-
ation. If the quality manager is held responsible be-
cause purchasing picked a lousy vendor, or a
manufacturing worker doesrit know how to solder,
then you are in a lot of trouble. Work is the respon-
sibility of those who get paid for doing it. No one
feels the comptroller is responsible if the sales fig-
ures are falling. But think about it: If everyone did
the job right, you wouldn't need a quality depart-
ment at all.
6. Worker attitudes are the primary cause of defects.
False. Workers perform like the attitude of the
management If they don't care about product con-
formance, because they sense that the manage-
it is

ment doesn't think it is important. An experienced


quality auditor can talk with a general manager for
five minutes and guess his outgoing quality level
within 1 percent. Workers are like a mirror. The re-
flection you see is your own.

7. I have trend charts that show me the rejection level


at everykey operation.
// this isn't true,you are in worse shape than I
thought. Indexes don't count. If you don't know
what the defect level is, how do you know when to
get mad?

8. I have a list of the ten biggest quality problems.


// you have a list of the ten or any number of
234 THE TOOLS
quality problems, you are probably not getting good
corrective action and you don't understand the situa-
tion.There is no such thing as a quality problem.
Problems should be identified according to the de-
partment responsible for corrective action. Thus you
should have manufacturing problems, purchasing
problems, design problems, service problems, etc.
The quality manager who maintains a list of quality
problems and, worse, gives it to the boss, is courting
personal disaster. After a while, when that manager
has not produced improved employee training, a
better production control system, a foolproof prod-
uct qualification technique, or reliable designs, he
or she is on the way out. In comes another one who
makes up a list of the ten worst quality problems,
and on and on. Don't say "quality problem." Call it
like it really is.

9. Zero Defects is a worker motivation program.


False. If you think Zero Defects is a motivation
concept, you are underestimating it. Zero Defects is
stating the standards of management in a way that
no one can misunderstand. You can't fool people
into thinking you have changed your ways by hav-
ing a few dinners and hanging some banners. You
have to really believe that ZD
is what you want.

Which do you want them to think you believe:


"Make it right the first time" or "Do the best you

can / understand no one is perfect"?

10. The biggest problem today is that the customers


don't understand.

False. The customer doesn't have to understand.


The customer is the customer. You have no mercy
on the people who make the items you buy in your
personal life. Why should you expect your cus-
tomers to treat you differently?

Step Three: Quality Measurement

1. Why are there separate introduction sections for


manufacturing and for "service"?
Note: Very few companies will search out non-
manufacturing-type measurements and use them in
instructor's guide 235

the program unless forced to do so. Starting the dis-


cussion at this point is the beginning of forcing
them. Discuss the erroneous concept of the manu-
facturing "ghetto," where all the mistakes are sup-
posed to happen.

2. Listen to the discussion that the HPA team had.


Let's read the comments out loud and see how they
might relate to our own operations.

Note: Assign roles don't make a big deal out of

it and have the different parts read out loud. Note
that the HPA team is taking its time and being very
careful to make certain they all have the same un-
derstanding of what is going to happen.

3. Can you compute the cost of quality in your oper-


ation the way Alice did for HPA? Have you done
it?

4. Do you think the team knew how serious the situa-


tion was before the comptroller gave the numbers?

Step Foot: The Cost of Quality


1. How do you feel about attitudes? Do you think they
are as important as Sharon did?

Step Five: Quality Awareness

Note: At this point you may


be through with the
first half day's session, and ready
to adjourn. This is
a good time to divide the students into groups to re-
port on specific steps and give their recommenda-
tions for executing them. Two groups on awareness
and two on measurement are about right. Have
them meet that evening to discuss their steps. They
should return prepared to make a presentation on
the actual things that should be done when putting
the steps into effect. This gets students to participate
and brings some real questions to the surface.

1. Why isso necessary to reach all the employees


it

with the quality message? Wouldn't it be enough just


to demand what you want?
Note: Quality is not something you can attain
through whipping and punishing those involved.
236 THE TOOLS
You have to give them the message, let them partici-
pate, and not try to fool them.

2. Why is it important to display the actual measure-


ments at the start of the program?
Note: If you don't record how things are at the
exact moment you start, you will not be able to take
advantage of the rush of improvement that occurs at
the beginning of the program. Being able to point to
this improvement will carry you over any rough
spots that may occur after a few weeks.

3. Can you think of some more measurements that we


could use in the nonmanufacturing departments?
Note: Keep track of any good suggestions so you
can share them with future classes.

4. This is a good time for reading the team meeting di-


alogue again. It helps in discussing the education of
the quality improvement team.

Note: Pay particular attention to Otto's comments.

5. Judging from the discussions at the meeting between


supervisors and employees there seemed to be no
resistance to the idea of quality improvement at
HPA. Why do you think managers are shy about
asking people for improvement?
Note: This is a good time to discuss how man-
agers can get separated from the people and get the
wrong ideas. We need to force this communication.
After all, most of us started on a bench or desk
somewhere.

6. What do you think about the idea of being "attitude


formers"? Do you think Hal was right? Who else
meets that definition in your company?

7. What was Hugh telling Al? Could you be put in the


same situation?

Step Six: Corrective Action

1. Ask one of the students to give a briefing of the re-


port that the quality engineer wrote. Give them the
assignment early enough so they can do a good job.
instructor's cutde 237

It is obvious that several people investigated and


c?.me to the wrong conclusion. Why?
Note: This points out again that you have to go
to the working people in order to find out what is
going on. Give the pitch about the corrective action
program at this time if you wish.

2. Al was surprised that someone thought his depart-


ment might have a few problems. It is apparent that
this had not occurred to him before. Why would he
feel this way? What should you do to keep it from
happening to you?
Note: Ask everyone when was the last time they
had an independent audit of their department?
3. What is the value of a staff person having an ap-
proach like the one John Halden took?
Note: Take a few moments to discuss the fact
that staff people are not meant to hurt the company
or the persons they are auditing. They will look bad
if things get out of control too. Comment on the
amount of planning that goes into handling the au-
dits properly. Don't let them get off on the subject
of line-staff relationships. This is a red herring.

4. Have someone give an analysis of the report on re-


ceiving acceptance.

Note: Itobvious that this was a sloppy oper-


is

ation. People were running all over the place, and


the supervisors reacted to pressure from purchasing
and production control. Start a discussion about the
corrective action steps that needed to be taken.
What could Al tell the improvement team?

Step Seven: Zero Defect Planning

Note: This is a good step to ask a group to report


about. It lends itself to original thought. Many of
the students will be shy about launching a ZD pro-
gram, and will seem particularly nervous at the
thought of having a ZD day.

1. How does the ZD phase of the program differ from


what they were already doing?
238 THE TOOLS
Note: You can point out that there will be a sig-
nificant improvement from earlier steps, b y, t that
there will be a leveling off after a few months. To
gain the rest of the improvement you have to go
into ZD. It is necessary to get all hands committed
to a higher level of improvement than that already
achieved. At the pre-ZD stage, they are just trying to
1
"do better.' That is not enough.

2. The concept as laid out on the pledge sheet is con-


densed from the one on the tape. Do you feel it is
necessary to add anyt^ino Mse to it? If so, what?
Note: Don't let them go too far out, but discuss
the concept enough to make sure that they have
read it and that they understand the business of han-
dling the pledge between supervisor and employee.
\ It is also necessary that they understand the need
for the pledge. Read the dialogue of the team meet-
ing, assigning roles as before.

3. Why did they have to discuss motivation again?


Why is there so much confusion about this?
Note: Tell them that as a staff person you know
that if you tell a general manager you want to start
a motivation program, the manager will send you to
see one of the PR people. (Note that the PR people
should be on the improvement team.)

Step Eight: Supervisor Training

Note: Make everyone take the ZD test. Make cer-


tain that everyone understands they are going to
have to explain ZD to their improvement team when
they get back home. Any questions that have to be
answered must be brought out and dealt with now.

1. The supervisors have been oriented at the time of


the quality awareness and corrective action steps,
and now when ZD
is being planned. What other

training do they need?


Note: Some things that require further training
are: pledge handling: how people who
to talk to
aren't sure the program is serious; what to say if the
union steward raises a question; how to handle
instructor's guide 239

ECRs. There are a lot of things they need to know.

Step Nine: ZD Day


Note: Discuss the entire day and make sure you
give it a completely positive image. After all, how
else are you going to get everyone's attention at the
same time? Provide information on how they can
get the material printed. Tell them about the ZD
days you have witnessed. Read the comments that
the president made in the HPA case: This is the
heart of the matter.

Step Ten: Goal Setting

Note: Goal setting makes a good group assign-


ment, particularly when you have them concentrate
on the white-collar areas.

1. What do you think of the measurement system that


Carl and his group proposed (ZD per hour)? Would
that work in your operation?

Note: You can do ZD per hour anywhere re-


gardless of the function, personnel, or whatever. It is
a great measurement system. Engineers can compete
against shipping clerks.

2. Now that some good hard improvement results are


coming in,what should be done with the informa-
tion?

3. How do we get information to all the people?


Step Eleven: Error-Caiase Removal

Note: Emphasize the point that the employee has


been asked to do a perfect job. The ECR is the way
for all employees to bring up any problem standing
in the way of perfection. They don't need to know
the solution. Have some of the sample ECRs read
out loud and discussed. They are typical of those
that will be received.

1. In the HPA case ECR was conducted late in the


program. Could it be done earlier?
Note: It can be done earlier, of course. However,
240 THE TOOLS
make certain that it is only done after people have
been given a clear understanding that improvement
is necessary.

Step Twelve: Recognition

Note: Have the HPA team meeting that was held


at this stage read out loud.

1. Why is it important not to get involved with giving


out things of high value in the recognition step?
Note: People don't work for things; they work
for appreciation. Make sure the students understand
and agree with this.

2. How does the Pulitzer Prize program relate to this


type of recognition?

3. What type of recognition programs can you suggest


that might be appropriate or original for your oper-
ation? How about regular awards?

Step Thirteen: Quality Councils

Note: Discuss the council system and its mean-


ing. Ask for individuals to state what they think of
the councils.

1. How can you install councils in your operation?


Step Fourteen: Do It Over Again
Note: This is the step that might give you prob-
lems because it is hard to make people believe that
you really have to keep on doing the program. Have
the HPA team meeting read out loud.

1. Why is it necessary to do the program over again?


Note: How else are you going to get all the atten-
tionyou need on the subject of quality? The pro-
gram will not just flow on like a river unless you
keep the channels cleared and the energy level high.
13
Mcsfc® Cmlmm

INTRODUCTION
This portion of the Tool section contains the Make Certain
orientation concept and presentation on the first four pages.
Following that there is a complete step by step description of
the events necessary in running a complete Make Certain
program.
Make Certain is a person-to-person, white-collar-oriented,
improvement program that gets everyone's attention immedi-
ately. You will receive prevention suggestions from over 90
percent of the people exposed to it.
Make Certain has been deliberately separated from the
HPA case because I felt that the team selected to "do it all
over again" should have something the original group didn't
know about.
Use it with good luck. It really works.

241
242 THE TOOLS
INSTRUCTOR'S GUIDE FOR
THE MAKE CERTAIN ORIENTATION
TIME:
About one hour

EQUIPMENT REQUIRED:
Blackboard or other writing display material

AUDIENCE:
Fifteen to twenty-five personnel of white-collar or administra-
tive functions. Preferably the attendees should represent
many different departments or functions. However the orien-
tation can be given to people from one operation as long as
the instructor is sensitive to special organizational or person-
ality problems that might be involved within that function.

PURPOSE:
• To explain the concept of MAKE CERTAIN in a way
that will make
the personnel involved want to participate
in this program of defect prevention for administrative and
functional activities

• To start an on-going examination of procedures and


methods by the personnel involved in order that they will
contribute to defect prevention activities on a regular basis

SEQUENCE OF EVENTS:
1. Introduce the thought that many nonconformance prob-
lems are caused in the administrative, service, and similar
activities of the company, and that they are long-range in
effect

2. Explain that MAKE CERTAIN is a program to help


identify those problems and eliminate them through
soliciting ideas from the individuals involved in doing the
actual work.

3. Ask each individual to state their personal "biggest prob-


lem" without detailed discussion. Write the problems on
the blackboard.

4. After problems have been stated and written, comment


MAKE CERTAIN 243

that everyone has selected problems that are


caused for
them by others, that no one seems to have problems that

they have caused for themselves. Note that this is a


typi-

cal attitude among humans.


5. Ask participants of the problems listed on the
how some
blackboard might be prevented. Avoid embarrassing any-
one or pinning someone down. Select one or two and
give prevention ideas yourself.

6. Tell them how necessary it is forof us to become


all

"certain makers." Cite a few statistics showing the cost of

error in "white-collar" areas.

7. Go around the room and ask people to state their "big-


gest problem." This time the problems should be dif-
ferent
8. Ask them to submit written ideas to the improvement
team. Suggest that they might like to have their supervi-
sor get together with them to set up defect prevention
discussion teams in their operations.

9. Thank them for coming and dismiss the group.

MAKE CERTAIN MEETING


INSTRUCTOR SPEAKS:
Good morning. My name is . I am here to participate
with vou in a discussion of a new program called MAKE
CERTAIN. The purpose of this program to help all of us
is
who work with pencils, pens, computers, telephones, and
other devices to learn more about our personal responsibility
to quality.
As you know from your personal experiences many of
the most frustrating and expensive problems we see today
come from paperwork and similar communication devices.
All of us have had problems with department store com-
puters, catalog companies, our internal departments, hotels,
and other service functions that are supposed to make life
easier for us.
Studies show that better than 25 percent of nonmanufac-
turing work is routinely done over before it is correct. Those
are the jobs we are involved in every day.
The biggest single problem we face in doing our work is
the communication that links our work together. Whatever
244 THE TOOLS

your job is management, computer programming, clerical,
product line operations, sales, engineering, front office, ac-

counting any of these and all of the others are bound to-
gether through a common need. This need is that we have to
transmit our personal contribution to our jobs via pencils,
pens, computer programs, conversations, or some specific de-
termined method.
We receive data from someone. We decide something on
the basis of that data, we transmit something along the line,
and we add our two cents worth to it. If we have not made
certain about what we have done, then we can set the entire
chain off in the wrong direction.
Business is a chain of paperwork and other communica-
tions that we control and utilize. The effectiveness of the
business is determined by how well we do that data transmis-
sion.
Unfortunately it only takes one bad bit of data in the
chain to disturb its effectiveness and accuracy. If we as indi-
viduals were electronic components, we would determine our
communication reliability the way it is done with com-
ponents. If you have 100 components in a circuit and each
one is 99 percent perfect the probability that the circuit will
perform is only 35 percent. You have to multiply each indi-
vidual reliability by the next and so on.
What we have to consider today is your individual relia-
bility in this matter of making certain that we don't cause
problems.
If it is possible to get every job done right the first time,
then we will be able to reduce the amount of time we waste
on rework, the number of customers we disappoint, and the
amount of frustration we cause ourselves personally. We will
be able to do more of the purposeful things we really like to
do.
making up some typical problems as examples
Instead of
in order to make this point, I would like to ask each of you
to state your biggest problem for us —
the thing you regard as
your biggest problem in getting your work done right the first
time every time. I will go around the room and ask each of
you to state that problem without discussion. I will write
them on the blackboard, and in a few moments we will have
a list of real-life items that we can discuss.
I think it is very important that we have a discussion
based on something we would recognize as being pertinent to
MAKE CERTAIN 245

our situation rather than something that comes from outside


our area.
Note: Point to each individual one at a time and ask
them, "What is your biggest problem?" As they state it,
make certain you understand it, and then write it on the
board. Be very open and friendly. In this activity they
have to understand that all of this is not going to be
used against them.

Typically they will say things like:

• They don't send me accurate data.

• Management isn't clear about what they want.


• We can never find out when problems happen.
• They keep changing the standards.
• It is hard to get computer time when you need it.

• The salespeople wait until the last moment to send in


the orders, then they want it immediately.

• The customers don't know what they want.


• There never is enough time.

Now we have all of these problems listed, and we can


see that they have something in common. What they have in
common is that none of them are problems we caused for
ourselves. They are something that others are doing to us.
This is the typical human reaction. It proves we are all nor-
mal, functioning human beings.
And of course it makes another point that we all have to
recognize: eliminating problems and improving personal reli-
ability is not just a matter of concentrating and trying harder.
It is not just a matter of thinking how to be more care-
ful. That is like your new diet. It only works for a little while.
Then you go back to your old ways. We all do that.
What we need is some systematic recognition of the
basic problem. There are three specific recognitions involved:

• First, we have to recognize that the largest cause of defects


and problems in any company is in the paperwork and
other communication system areas. The factories have their
own problems, but they are working with what we give
them.
246 THE TOOLS
• Second, we have to recognize that every problem is pre-
ventable and that the person who can best contribute the
idea to prevent it is the one who has at some time caused it
or a similar problem.
• Third, we have to recognize that although we are hearing
these words and agreeing with them, we as individuals do
not really believe that they apply to us personally. That is
only human.

The way to get started on making certain is to recognize


that we cause problems for ourselves, and we must find ways
to prevent them.

CLOSING SEQUENCE:
1. Review the "biggest problems" for possible solutions.

Let's look again at these problems we put on the black-


board. I don't remember which ones belonged to whom
but let's take a couple of them and see how they might
be prevented if we can get the right people interested.
For example:
• If management isnot making the instructions clear, write
a procedure and get management to agree with it or change
it to what they want. Then it will be clear.

• If a group fouls up what you send them, perhaps you


need to think out how to explain it to them in a different
way.
• If data isn't accurate, perhaps you need to conduct a little
school on how to collect data properly, or maybe your
group should have a prize for the one who sends down the
most accurate data.

These kinds of ideas are well within your experience.

Note: After you have given a few, encourage the audi-


ence to contribute some.
2. Give them an idea submission format so they can go back
and come up with some ideas to make their life easier.
3. Ask again, without writing on the board: "What's your
biggest problem?" This time you should get many people
saying that they have to gQt in there and make a con-
tribution to getting things done right the first time. They
are going to recognize that they are part of the problem.
MAKE CERTAIN 247

Suggest that they might like to have regular meetings in


their groups in order to discuss defect prevention on a reg-
ular basis, like corrective action groups in manufacturing.

4. Thank the group and dismiss them. If anyone wants a


fuller discussion or wants specific directions, ask them to
stay after the meeting in order that the group might move
along.

EVENTS IN CONDUCTING
THE MAKE CERTAIN PROGRAM
1. management staff on the program concept and
Brief
Agree to appoint coordinators for each depart-
intent.
ment. Remember, the emphasis is on paperwork and
service operations.

2. Meet with coordinators to explain the program. Ask


them to plan a meeting of all the supervisors in their
department in order to orient them to the program.
Solicit examples of cases where defect prevention or
more attention to detail could have saved problems and
money. Tell them they will need at least three of these
examples. They don't need to be big things. For in-
stance: billing errors where the customer returned the
bill because something was wrong with it, thus we didn't

get paid on time; purchase order errors where the


wrong information was given, causing the wrong prod-
uct to be delivered; work instruction errors; and the
many other things that supervisors complain about
when they discuss their work. With a little encourage-
ment, and the assurance that it will not be used to em-
barrass them, the examples will flow.

3. Depending on the company, the supervi-


size of the
sors will be taught how program by the coor-
to use the
dinator, if there are not too many. Otherwise the
coordinator must teach the department representative
who will then instruct the supervision, including the de-
partment head.
4. Supervisors meet with their people. They explain the
logic and concept of the program and tell why the
company needs their help, citing some examples. Then
they have this discussion:
248 THE TOOLS
• Who is our customer inside the company? (It could

be another department, the president, or whoever re-


ceives the result of our work.)

• What specifically does that customer want from us?


• What could we do, specifically, to make sure the cus-
tomer does not get it?

• Who the ultimate customer, the one


is who uses the
product or service of the company?
• What specifically does that customer want from us?
• How can we make certain that the customer does not
get it? (Keep all this light, but insist that the ques-
tion be thought out.)

• Select the best actions and discuss them. Then ask ev-
eryone to suggest how we could measure these items.
For instance: if we were to always send the bills to
the wrong address, we would know we had failed to
do wrong if one of the bills didn't come back. That
would mean we had made a mistake and sent it to
the right address.

• Write down the suggested measurements because they


will form the basis for positive action measurement
later.

5. Ask the individuals to turn these thoughts around


and make suggestions of ways we could make certain
these failures don't happen. The form says: "How can
we make certain that our customer is receiving what
we have said we would provide?"
6. Receive the suggestions and give a "Certain Maker"
badge for each one submitted. The supervisor makes
his comments on the suggestion card and sends it to the
coordinator.

7. Make
a lot of fuss about suggestions that are imple-
mented right away. Post ideas and photos on bulletin
boards.

8. Measurement of the suggestions should be based on


how many hours of work do not have to be spent as a
result of something being done right. Sometimes
material will be involved also. Multiply the hours by
the loaded average wage to get a dollar figure. But
MAKE CERTAIN 249

remember that the idea of the program is to instill the


attitude of defect prevention.

9. During the last week, have a count-down: four days


left to Make Certain, three days left. . . .

10. At the end of the program, write a letter to all em-


ployees, thanking them for their participation and ex-
plaining that no suggestions will be left unscrutinized.

11. Implement as many suggestions as you can, and


keep reporting on that for the next several months.
12. Study and learn the orientation program. For best
results, do it exactly the way it is written.
Guidelines for Browsers

Quality is free. It's not a gift, but it is free. 1

Professionals in any role who obscure explanations by


using mysterious terminology do themselves, and their
roles, a disservice. 3

"Why spend time finding and fixing and fighting


all this

when you could prevent the incident in the first place?" 4


Quality an achievable, measurable, profitable entity
is

you have commitment and


that can be installed once
understanding and are prepared for hard work. 6
A complete corporate quality program has always been a
"table" containing all the "integrity" systems. 7
Management has to get right in there and be active
when it comes to quality. 7
The first and it is never over, is to overcome
struggle,
the "conventional wisdom" regarding quality. 7
What should be obvious from the outset is that people
perform to the standards of their leaders. If management
thinks people don't care, then people won't care. 8

Traditional quality control programs are negative and


narrow. 9
250
GUIDELINES FOR BROWSERS 251

Quality improvement through defect prevention, a


fourteen-step program for improvement, is the
foundation of all ITT quality programs. 9

Ittakes four or five years to get people to understand


the need for, and learn to have confidence in, an
improvement program. 9

Cash or financial awards are not personal enough to


provide effective recognition. 10

The cost of quality is the expense of doing things wrong. 1

But the facts of life today are that each year your costs
of sales rises faster than your prices. 1

"Quality is ballet, not hockey." 1

The problem of quality management is not what people


don't know about it. The problem is what they think
they do know. 13

Quality has much in common with sex. 13

It is difficult to have a meaningful, real-life, factual


discussion on complicated subjects
sex, quality, or other
until some basic erroneous assumptions are examined
and altered. 13

We have to examine the thinking processes that lead


some to believe that quality is merely goodness that
always costs more. 14

People conduct the business of every company, whether


it is a foundry or a hotel. 14
The first erroneous assumption is that quality means
goodness, or luxury, or shininess, or weight. 14

"Quality of Life" is a clich6 because each listener


assumes that the speaker means exactly what he or she,
the listener, means by the phrase. 14
We must define quality as "conformance to
requirements" if we are to manage it. 15
The second erroneous assumption is that quality is an
intangible and therefore not measurable. In fact, quality
6

252 GUIDELINES FOR BROWSERS

is precisely measurable by the oldest and most respected


of measurements —cold hard cash.

The third erroneous assumption is that there is an


"economics" of quality. 1

The fourth assumption that causes problems is the one


that says that all the problems of quality are originated

by the workers, particularly those in the manufacturing


area. 16

People in the manufacturing ghetto can contribute only


a little to the prevention of problems because all
planning and creation is done elsewhere. 17

The fifth erroneous assumption is that quality originates


in the quality department. 17

Once integrity is compromised, it does not return to its

original pristine state. 18

Quality management is a systematic way of guaranteeing


that organized activities happen the way they are
planned. 19

Qualitv management is needed because nothing is simple


anymore, if indeed it ever was. 19

The further the administrator gets from the administered,


the less efficient the administration becomes. 19

If effective quality management is to be practical and


achievable, it must start at the top. 19

Managing a family, for instance, is probably the most


of all iobs Tt is clear that very few have been
difficult
completely successful at that task. 21

Familv management measures everything against the


manager's personal standards. Thus, approved activity is
always several fads behind. 22

Just as the folklore of family management states that if


you don't spoil children, and are sure to raise them with
loving discipline, they will turn out to be good, so the
folklore of business management states that if you have
good in your heart, you will produce quality. 22
GUIDELINES FOR BROWSERS 253

If you can't produce a dead dragon each week, your


license may be revoked. 23

Those who can predict the future have never been


appreciated in their own times. 24

Changing mind sets is the hardest of management jobs.


It is also where the money and opportunity lie. 24

Act now for reward later. 24

Prevention is not hard to do — it is just hard to sell. 24

A career could be over before a person had the chance


to experience each and every thing that can go wrong. 24

Problems breed problems, and the lack of a disciplined


method of openly attacking them breeds more problems. 26
Uncertainty-age companies know they have problems
but don't know why, although they do know it isn't
because they aren't working hard. 27
The stages of quality maturity do not provide individual
guided tours like Scrooge's ghosts. 28

Quality means conformance. Nonquality is


nonconformance. 39

We are a fragile and vain group, we humans. 43

Uncertainty lives in the present. Each day dawns on a


new world, and each night ends that world. 45

What Awakening is really afraid of is commitment to

the future. Uncertainty doesn't know about the future


and so can't be bothered by it. Awakening knows about
it, and is bothered. Both do nothing, but for different
reasons. The result is the same. 45

Attitudes are really what it is all about. 46

The first thing you notice when a management moves


into Enlightenment is the relaxation of tension. 46

Just because the general manager and the department


heads have gotten religion doesn't mean that anyone else
has. 47
254 GUIDELINES FOR BROWSERS

The time it takes for true, long-lasting,


never-to-be-overcome improvement to set in is years.
And even then you can never be sure. 48

Those who consider quality improvement a motivation


program never reach the age of Wisdom. 48

If you don't expect errors, and really are astonished


when they occur, then errors just do not happen. 48

Think where your company could be if you completely


eliminated failure costs. 48

The most effective way to bring operating and other


management people to their senses is to put them in
contact with someone they will believe. 49

Each day brings inputs from dedicated, thoughtful,


sincere people who want you to do things their way. It is
a dreadful obstacle to overcome. 49

In every operation there is one area that is more open to


new ideas than the others. 49

Policies are used to settle arguments. 56

The purpose of having an independent, objective quality


department is to limit choices to those who have nothing
to gain from the decision. 58

Ifsomething is easy to understand and makes sense, and


yet isn't always done, there has to be a reason for not
doing it 58

It is possible to make an excellent living actually doing


the job of quality rather than just auditing to find out
why it wasn't done. 58

You can get rich by preventing defects. 59

There is absolutely no reason for having errors or


defects in any product or service. 58

Functional management is much more difficult than


operations. 59

Operations is a matter of ordering functional people


around. 60
GUIDELINES FOR BROWSERS 255

An inspector is not a true inspector unless the inspection


is independent and last. 60

Half of the rejections that occur are the fault of the


purchaser. 63

Quality engineering is supposed to be responsible for


determining and planning the work of the rest of the
department 64

People really like to be measured when the measurement


is fair and open. 64

Senior management will let quality work on the future


only if it is helping them survive the present. 65

The real strength, and value, of quality engineering


involves learning from the past to make a smoother
future. 65

People will only tell you the troubles that others cause
for them. They will not reveal what they make happen
themselves. 65

Once you put on a suit, no one tells you the truth


anymore. 65

Good things only happen when planned; bad things


happen on their own. 66

Every new thing must be tested and proven before it can


be used. 66

Reality is the ultimate criterion. 67


Audit is the Bat Masterson of business. 67
Audits catch only the undedicated, bored, or careless. 67
There is a theory of human behaviour that says people
subconsciously retard their own intellectual growth. 68

The bigoted, the narrowminded, the stubborn, and the


perpetually optimistic have all stopped learning. 68
The customer deserves to receive exactly what we have
promised to produce. 69
256 GUIDELINES FOR BROWSERS

Most poor government regulations exist only because


those who were involved didn't ta1< e the time to offer
positive guidance and suggestions on the best way to
legislate requirements or conduct regulation. 70
There are much easier ways to rip off the world than
beating a big company out of a few bucks. 70
There are millions of products produced every day that
don't wind up in court 71

People just want their rights until you try to trample


them. Then they want revenge. 71

I do not know of a single product safety problem where


the basic cause was something other than a lack of
integrity judgment on the part of some management
individual.

Product safety is not a legal problem, it is an ethical


one. 71

No person is so exposed as when that person starts to


handle a problem. 73

Operation^ that trulv want to handle problems, for the


purpose of solving them must create an open society
within their walls that is imbued with the basic concepts
of integrity and objectivity. 75
Each human conflict produces winners, losers, and
observers. 74
Over 85 percent of all problems can be resolved at the
first level of supervision they encounter. 75

Once in a while you come up with something for which


there is no solution. Then you make a judgment and
accept the situation, and life goes on. Count on one or
two per career. 75

Specific problems require specific solutions. 76

"Assembly" is just making big ones out of little ones. 78

Qualitv improvement has no chance unless the


individuals are ready to recognize that improvement is
necessary. 81
GUIDELINES FOR BROWSERS 257

Unless you know how you are doing as you move along,
you'llnever know when you're done or if you have
succeeded. 86

People like to think that they shape events, but in reality


the other way around.
it is 87

In the final equation, the supervisor is the person the


employee sees as "the company." 94

Quality is free, but no one is every going to know it if

there isn't some sort of agreed-on system of


measurement. 102

Half the people in the most manufacturing of


manufacturing plants never touch the product. 103

As individuals we are all service people. Unless we are


blood donors —then we are manufacturing plants. 103

Don't get lost in statistical swamps. 107

The most difficult lesson for the crusader to learn is that


real improvement just plain takes a while to accomplish. 108

Basically, we are slow to change because we reject


newness. 109
Urban redevelopment has cost more money than any
domestic program except defense. 109
Both operations have similar effects: the subjugation of
cities and their populations. The difference is in the
location of the cities. 109

You have to lead people gently toward what they


already know is right. 110
There is a lot more to golf than having the equipment
and the intent. HO
People who have to put improvement programs of any
kind into their company always feel that others are not
for it.
HI
We don't really like to get out front with too much
unless we are absolutely certain it will be properly
received.
HI
258 GUIDELINES FOR BROWSERS

Most things don't work like they are supposed to work. 1 12

Helping management to recognize that they must be


personally committed to participating in the program
raises the level of visibility for quality and ensures
everyone's cooperation so long as there is some progress. 112

Formalizing the company measurement system


strengthens the inspection and test functions and assures
proper measurement. 1 14

Having the comptroller establish the cost of quality


removes any suspected bias from the calculation. 115

The communications is that it gets


real benefit of
supervisors and employees in the habit of talking
positively about quality. 115

Improvement comes with each step of the overall


program. 116

The proof of understanding is the ability to explain it. 117

Making a "day" of the ZD commitment provides an


emphasis and a memory that will be long-lasting. 117

Genuine recognition of performance is something people


really appreciate. They will continue to support the
program whether or not they, as individuals, participate
in the awards. 118

Repetition makes the program perpetual and, thus "part


of the woodwork." 1 19

If quality isn't ingrained in the organization, it will never


happen. 119

"Style" is a word that is often used in our culture to


describe certain subjective measures of performance. 120

Each generation peers at its predecessors and remarks


that things are certainly different today. This generation
can look at itself and make the same comment. 121

The executive's problem in understanding and utilizing


the labor force is compounded by the fact that people
are not interested in doing something just because they
have been told to do it. 122
GUIDELINES FOR BROWSERS 259

There are no clear-cut differences among the various


levels of an organization when it comes to understanding
the purpose and work of the company. 123

We need people who are in complete control of


themselves* people who are able to think creatively and
to implement their ideas at the same time, and stay loose
enough tr» anticipate and avoid whatever it is that is
lurking behind the next hill. 124

think of any profession you would want


It is difficult to
to be part of that wouldn't demand a great deal of
integrity and compassion. 124

If a pearl of wisdom drops from your lips when no one


is about, and is lost, it will have no value. 125

Once people find that you are willing to take the time to
understand them thev will take the time to arrange
thoughts into concepts that are easier to comprehend. 125

Nothing is more important than true understanding, and


nothing is harder to come by. 126

Being part of a team is not a natural human function; it


is learned. 126

Cooperation does not mean that you have to abandon


any personal standards. 126

Trustworthy people acquire no worthy enemies as they


go about their labors. 126

Ignored managers cannot cooperate with anyone. 126

Helping involves giving without direct expectation of


immediate return. 126

To help in a positive manner, you must be genuinely


interested in people and results. 127

True help is truly unselfish. 127

Your efforts to help are based on a genuine concern for


the individual, and are not to further your own ends,
then the help will be accepted. 127
260 GUIDELINES FOR BROWSERS

More done about personal transmission, and less is


is

accomplished, than any individual function I know. 127

You have to have something to say. 128

Your clothes, your physical manner, your weight, your


cleanliness,and many other things transmit a lot about
you, often so clearly and loudly that the words you
choose to say may not be heard at all. 128

Writing is like putting. Short and straight is best; long


and curving is undesirable. 128

Being understood is hard work. 128

Not preparing formally for any speech is the biggest ego


trip of all. 128

All these transmission factors project a picture of you on


everyone's mental wall. 129

Think of the people you know who are objectionable to


you in some way. You probably think they are doing it
on purpose. They aren't. 129

In the world of management you can learn to be


creative. 129

You can create solutions to complicated problems by


being the only one to break that complicated problem
down to its basic causes. 129

The most important aspect of creativity for management


styleis not to get into the habit of stating your lack of

creative ability. 130

Less than one-tenth of one percent of the people in the


world are truly creative, that is, able to develop an
original concept from an original thought. 130

The most valuable manager is one who can first create,


and then implement. 1 30

People don't do for a living what they learned in college. 131

It is not possible to know what you need to learn. 131


GUIDELINES FOR BROWSERS 261

Just about nothing is new, and almost everything used to


be worse. 131

It is impossible to stop things worth learning from


happening. 132

The leader who runs out of jobs for the led to do will
soon be replaced by someone more interested in working
hard. 132

If the leader is the only one who knows what game is

being slaved, then the leader is obviously the only one


who can win. 1 32

A closed leadership does not grow, 132

A good Slower has to want the same results that the


leader wants. 133

The art of following should notbe looked on as


something to be learned just to fulfill a temporary
obligation on the way to becoming supreme exalted
rooster. 133

You never, never get away from being a follower. 133

Pretending all the time is a terrifying management style


to adopt. 133

Listening Vou can convey no greater honor than to


actually hear what someone has to say. 133

Cooperating Voudon't just cause plays to be executed,


you protect others in the process. 133
Honing Let someone lean on you without expecting to
lean back. 133
Transmitting How you come across to others should not
be left to chance. 1 34

Creatine Original solutions are a result of hard work in


uncovering unoriginal problems. 134

Implementing. There comes a time when someone has to


actually get the job done. 1 34

Learning. When you have an answer for everything, you


know you have stopped learning. 1 34
262 GUIDELINES FOR BROWSERS

Leading. Leaders start to fail when they begin to believe


their own material. 134

Following. You
never reach the stage when you aren't
working for someone, so learn to be good at it. 134

Pretending. If you're going to be an actor, be a good


one, but stay out of management. 134

Hockey is an exciting sport, and its style is exciting. But


it is not a good management style. 134

Ballet is a communications medium. It is also a practical


and effective management style. 135

Hockey is detection; ballet is prevention. 135

Quality is free. But it is not a gift. 136

The problem managers face comes when they are


biggest
actually expected to accomplish all the things they have
been saving could be accomplished if only everybody
would listen to them. 137

Everyone was to blame but no one was responsible. 140

ZD is the attitude of defect prevention. It means 'do the


job right the first time.' 144

People are conditioned to believe that error is inevitable. 145

The family creates a higher performance standard for us


than the company does. 145

Make a commitment to a standard, communicate it,

recognize performance, and then recycle. 148

It is much less expensive to prevent errors than to


rework, scrap, or service them. 149

formal quality policy is not established by the


If a
management of the organization, then the personnel will
select their own individually. 150

"You are involved in installing a new behavior concept


in the company, but you have to pretend that all that is
involved is a technique of program management." 169
GUIDELINES FOR BROWSERS 263

Quality measurement is only effective when it is done in


a manner that produces information people can
understand and use. 170

Most managers are so concerned with today, and with


getting our own real and imagined prohlems settled, that
we are incapable of planning corrective or positive
actions more than a week or so ahead. 177

People create most of their problems through their


attitudes. 180

Negative attitudes seem more contagious than positive


ones. 181

A permanent improvement program will become part of


the culture of the company. 186

We are attitude formers whether we like it or not. 190

Corrective action is just a matter of getting all the rocks


rolled over and seeing what is under them. 194

We have a dual standard: one for ourselves and one for


our work. 200
But there is no substitute for the words "Zero Defects."
They are absolutely clear. 207

People really don't work for money. 218

Motivation is short-term in effect. 227


Tf you start confusing quality with elegance, brightness,
dignity, love or something else, you will find that
everyone has different ideas. 232
It is always cheaper to do the job right the first time. 232
If you assign the inspection and test responsibility to
manufacturing, you will not have accurate recordings of
defects. 232
Oualitv departments are supposed to measure and report
conformance, demand corrective action, encourage
defect prevention, teach quality improvement, and act as
the conscience of the operation. 233

Workers perform like the attitude of management 233


264 GUIDELINES FOR BROWSERS

If you don't know what the defect level is, how do you
know when to get mad? 233

You have no mercy on the people who make the items


you buy in your personal life. Why should you expect
your customers to treat you differently? 234
Many of the most frustrating and expensive problems we
see today come from paperwork and similar
communication devices. 243
It only takes one bad bit of data in the chain to disturb
its effectiveness and accuracy. 244
The way to get started on making certain is to recognize
that we cause problems for ourselves, and we must find
ways to prevent them. 246
Index

B
Absolutes of quality manage- Ballet as a management style,
ment, 111 13, 134-36
Acceptable quality level (AQL), Behavior, concept of, 169
146 Buck a Day (BAD) program,
Acceptance: 9,48
product, 60-61 Buyer rating, 175
purchased goods, 63
Acceptance labo? 179,

Administration, efficient, 19
American Express, 12 Cadillac quality, 15
American Society for Quality Case histories:
Control (ASQC), 36 corrective action, 193-96
Appraisal costs, 105-106 cost of quality, 101-107
AQL (acceptance quality level), employee relation^ 95- 100
146 field qualitypioblems, 72-73
Attitude (s): HPA Corporation, quality
of defect prevention, 144 improvement program
of management (see Man- of, 137-222
agement attitudes) management attitudes, 35-41,
Attitude formers, 190 50-54
Audit, 67-68 measurement, 183-187
quality, case history, 195-96 performance measurement,
Audit report. 196-97 87-92
Authority, 130, 134 problem solving. 78-86
Awakening: quality audit, 195-96
definition of, 27-28 qualm improvement. 137-48
as management attitude, 45 Zero Defects day, 208-15
Awards, value of, 219 Certainty:
Awareness, 69- 70 definition of, 30
quality {see Quality aware- as management attitude, 49
ness) Charts, measurement, 170
265
266 INDEX

displaying, 174-75 job, 92-95


Commitment {see Management case history, 95-100
commitment) Energy sources, 123
Complaints, customer, 69-70 Enlightenment:
Computers, 123 definition of, 28-29
Concept: as management attitude, 46-
definition of, 169 47
of Zero Defects, 145, 200-201 Error cause removal (ECR),
Conformance to requirements, 117-18,215-18,
15, 38-39 239-40
Consumer affairs, 69-70
"Conventional wisdom" regard-
ing quality, 7
Conversation, 129 Failure costs, 106-107
Cooperating, 126, 133 Family management, 21-22
Corrective action, 65, 116, Fitness for use, 38
191-98, 236-37 Following, 132-34
Cost of quality (COQ), 15, 29, Functional management, 56, 60
32, 178-81, 235
case history, 101-107
content of, 104-105, 177-78
appraisal costs, 105-106 Ghetto, manufacturing, 17, 175
failure costs, 106-107 Ghettos, 17
prevention costs, 105 Goal setting, 117, 212-15, 239
evaluation of, 115 Grid, maturity {see Quality
expenditures for, 179 Management Maturity
reducing the, at ITT, 11 Grid)
Councils, quality {see Quality
councils)
Creating, 129-30, 134
H
Helping, 126-27, 133
Crime, 17
Cultural change, 6, 12, 110,
Hockey as management style,
13, 134-36
186
Currency translation, 121-22
HPA Corporation, quality im-
provement program
of {see Quality im-
provement program)
Data acquisition, 171
Data analysis, 64
Day, ZD {see Zero Defects day) Implementing, 130, 134
Defect prevention, attitude of, Industrial Motivation, Inc., 48w.
48, 144 Inspection operations, 27-28, 60
Defects {see Zero Defects) Instructor's guide:
for Make Certain program,
242-47
for quality improvement pro-
Economists, 121 gram of HPA Cor-
Education, quality, 68 poration, 225-40
Employee identification with Integrity, 18, 71, 124
INDEX 267

Integrity systems, 7 listening, 125


ITT Corporation, 5-12, 19 pretending, 133
transmitting, 127-29
Maturity, stages of, 26-31
Awakening, 27-29
Leading, 131-32, 134 Certainty, 30
Learning, 131, 134 Enlightenment, 28, 29
Lectures: Uncertainty, 26-27
employee identification with Wisdom, 29, 30
job,92-95 Maturity grid (see Quality
performance measurement, Management Maturity
86-87 Grid)
supervisory problem solving, Measurement ( s )
76-78 of buyers, 175
Listening, 125, 133 comptroller, 184
computer programming, 184
description of, 60
M engineering, 184
185
field service,
Make Certain program, 18,
173*, 241-49 of guards, 185
action steps for, 225-27 manufacturing, 170-71, 184
discussion of steps for, 228- marketing, 184
40 performance (see Perform-
events in conducting, 247-49 ance measurement)
instructor's guide for, 242-47 of personnel, 185
(See also Qualitv improve- purchasing, 184
ment program) quality department, 184
Making quality certain, 3-12 service, 171-74
definition of, 3 (See also Quality measure-
Management attitudes, 35-54 ment)
Awakening, 45-46 Meeting:
case histories, 35-41, 50-54 of assembly workers, 188-89,
Certainty, 48 213
changing, 49-50 production control, 189-90
Enlightenment, 46-47 Motivation, 28, 48, 143, 202,
Uncertainty, 44-45 227
Wisdom, 47-48
Management commitment, 112-
13, 149-52, 228-29 N
Management participation, 7-8 Nonconformance problems, 10
Management style, 120-36
checklist, 124-34
cooperating, 126
creating, 129-30 Organization, quality, 32, 59-60
following, 132-33 (See also Quality organiza-
helping, 126-27 tional status)
implementing, 130-31 Orientation:
leading, 131-32 Make Certain, instructor's
learning, 131-32 guide for, 242-47
268 INDEX
quality management, 230 cesses, and procedures,
Original programs, 7, 9-10 66
Quality:
conventional assumptions
about, 13-18
"Paperworkmanship" problems, cost of (see Cost of quality)
172 definition of. 15, 37-38
Performance measurement, economic* of. 16
86-88 responsibility for, 17
case hiMon. 87-88 test for understanding, 232-
Personnel analysis, 156 34
Pinto quality, 15 versus the real world, 8, 109
Planning 65-66 "Quality of life," 14-15
Zero Defects (see Zero De- Quality assurance, 59
fects planning) Quality awareness, 115, 181-91,
Policy, quality 56-58,150-51 23M6
Poster prograir 187 Quality cost (see Cost of qual-
Posture quality, 32
. ity)
Pretending. 133. 134 Quality councils, 9, 118-19,
Prevention 4. 24, 69 152, 165 220-21, 240
defect, attitude of, 48, 144 Quality education 68
Prevention costs, 105 Quality engineering 62-64
Problem (s): Quality function (see Quality
handling, 32, 72-100 organizational status)
employee identification Quality improvement program
with job. 92-95 9, 32, 68, 81, 108-19,
casehistor\,95-100 149-222
performance measurement, components of: corrective
86-87 action, 116. 191-98
case history, 87-92 cost of quality. 115, 178-81
supervisorv problem solv- do it over again, 118-19,
ing, 76- 78 221-22
case history, 78-86 error cause removal, 117-
your biggest, 43-44, 137, 18, 215-18
284 goal setting. 117,212-15
(See also Qualitv problem) management commitment,
Problem identification. 170
112-13, 149-52
Process Qualification 66
quality awareness, 115,
Product accept nee 60-61
.
181-91
Product Qualification. 9, 66
quality councils, 118-19
Product safety 70-71
Professional quality manage- 220-21
ment, 7-9 quality improvement team,
Profitimprovement, 1 113, 152-62
Purchasing, 62-63 quality measurement, 113-
15, 170-78
recognition, 118, 218-20
supervisor training, 116-17,
Qualification of products, pro- 204-207
INDEX 269
Zero Defects day, 117, Russian Ministry of Electron-
207-12 ics, 11
Zero Defects planning,
198-204
Ad hoc Committee for,
116 Sales, distribution of, 155
history of, 139-48 Scrap, 179
instructor's guide for, 225-40 Service, 144
Quality improvement team, Service measurement, 171-74
113, 152-62,229-34 field, 185
Quality management, 14, 18, Sex, comparison of quality and,
19,25 13-14
absolutes of, 111 Sheraton hotel chain, 1
professional, 7-9 Social expenses, 122
Quality Management Maturity "Software," 171
Grid, 12, 19, 21-32, Status Reporting, 64
42-48 Style {see Management style)
chart, 32-33 Supervisor training, 116-17,
as a comparison measure- 204-207, 238-39
ment, 31-32 Supervisory problem solving
stages of maturity {see Ma- 76-78
turity, stages of) case history, 78-86
{See also Management atti- Supplier quality, 62-67
tudes) Supplier quality engineering,
Quality measurements, 15-16, 62-63
113-15, 169-78, 234-
35
Quality organization status,
32, 55-71 Team, quality improvement,
auditing, 67-68 113,152-62,229-34
consumer 69-70
affairs, Technique, definition of, 168-69
product acceptance 60-61 Telecommunications, 11
product safety, 70-71 Tension, relaxing of, 47
quality education, 68 Test(s):
supplier quality, 61-67 on quality knowledge, 157-
Quality policy, 56-58, 150-51 58, 232-34
Quality problem, 5, 6, 17, 111 Zero Defects IQ, 205
Testing, acceptance, 60
Toastmasters International,
R 128-29
Training {see Supervisor train-
Recognition, 7,10-11, 118,
ing)
173, 218-20, 240
Transmitting, 127-28, 134
Reliability concepts, 4 Trend charts, 170
Responsibility, understanding, Trustworthy, 126, 133
42-48
Rework, 179
Rich, getting, 58-59
Ring of Quality program, 9 Uncertainty, 26-27
270 INDEX
definition of, 26 Z
as management attitude, 44- Zero Defects (ZD), 9, 17,
45 116-17, 163
Unions, 166-67 concept of, 145, 200-201
Urban redevelopment, 109-10 IQ
test, 205
not a motivation program,
143
W per hour, 214
Zero Defects dav, 117-19,
Warranty, service, 179
White-collar errors, 156 207-12. 239
Wisdom: anniversary of CZD IT), 222
definition of, 29-30 Zero Defects planning. 198—
as management attitude, 204, 237-38
47-48 Ad Hoc Committee for, 118
Workers, 16-17
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