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Nothing is much drier than the set of regulations that describes the internal working of accounting. Perfectly understandable words have entirely different meanings, and specious reasoning is raised to an art form. As a long-time CEO, I can say that I do not look forward to my regular meeting for discussing accounting or audits. I find myself asking questions all the time and staring back at people who obviously are not too certain of my business competence.
Nevertheless, accountants have found a way to provide management with some level of confidence. They have all agreed on what they call Generally Accepted Accounting Principles (GAAP). The purpose of GAAP is to list all the ways money is accounted for and reported. The procedures and policies involved comply with the requirements set out by governments and the Accounting Board. CEOs can watch as the accountants set up their data retrieval and examination systems and have confidence that it is being done properly.
However, no one confuses accounting with financial management. GAAP does not specify how, where or for what money should be disbursed. Those decisions are the responsibility of management. Managers use the numbers they receive from accounting and ask for information now and then, but they don't get advice. As a result, the financial people have high-level positions (often on the Board of Directors) in the organization, and they are well-rewarded.
The quality professionals, however, confuse quality assurance and quality management. ISO 9000 and its brethren are really generally accepted quality assurance principles (GAQAP). They are not quality management; they are quality assurance. The difference is immense. When such principles are presented as management tools, they disappoint everyone. Accounting practices would suffer the same fate were they to take this course: Telling managers that keeping neat financial transaction records caused profit to happen would make them chuckle, as would telling them that having books of procedures makes quality happen.
ISO 9000 is a valuable information resource. The new version, ISO 9001:2000, has more of the same, but makes it clear that we need to educate people about what it can and can't do. Those who try to make it anything other than a system for quality assurance will not have a happy next century.
About the author
Philip B. Crosby, a popular speaker and founder of Philip Crosby Associates--now PCA II--is also the author of several books, including Quality and Me: Lessons From an Evolving Life (Jossey-Bass, 1999) and The Absolutes of Leadership (Jossey-Bass, 1996). Visit his Web site at www.philipcrosby.com . |
