Quality Management

by A. Blanton Godfrey

Not Invented Here

An international company with more than 100 locations had an outstanding opportunity. In one of its processing plants, they reduced reblends from 12 percent to 0.5 percent. This 24-to-1 improvement was worth nearly $2 million in increased capacity and reduced rework. Because this company had more than 70 similar plants around the world, it was easy to calculate the reblends in each and estimate the savings if all achieved similar results. The bottom-line results would be more than $100 million. And yet, several years later, this well-managed, world-leading company still hadn't been able to accomplish this.

In another example, a leading service company had made improvements in one of its locations, resulting in $300,000 savings annually. Almost all of its 240 sites had similar problems with similar improvement opportunities. Yet this company struggled with getting anywhere close to the more than $70 million possible savings.

These companies struggled with one of the most difficult tasks: the problem of replication. They had no system to assure that outstanding results in one part of the organization, or from an outside organization, would be understood and copied in all similar parts of the organization. The dreaded not-invented-here syndrome was alive and well. Progress was slow, results were modest, and everyone reinvented the solution or created new solutions if the problems were solved at all.

There are many reasons why replication is so difficult. People have a natural resistance to change. It is too easy to just say: "That's not my problem. We're different." Too often, we strongly feel that solutions to problems "not invented here" just won't work. Rather than exploring ways we could modify the solutions to fit our situations, we start over and reinvent. Often this tendency to reinvent is supported by organizational structures that reward creativity and new ideas far more than results. One development lab went so far in trying to break this paradigm that they created a "thief-of-the-month award" for the individual or team that "stole" the best idea and implemented it.

These days many organizations have quite effective systems for nominating new projects and forming cross-functional quality improvement teams. But no similar structure exists for replicating solutions.

There is often no accountability or responsibility for attaining similar results. Many CEOs set aggressive, detailed revenue and profit goals each year, but somehow they feel that quality should be managed by the local presidents or business unit heads.

We can take several steps to stimulate replication. The first step is to publicize results. Sometimes this will stimulate others to attempt to attain the same results.

Even better is communicating how the results were attained. How was the problem defined? What data were collected? What were the root causes of the problem? How were those causes determined? What were the alternative solutions considered? How was the best solution determined? How was it implemented? What controls were put in place?

Some leading companies create documented case studies in standard formats. These case studies are shared widely throughout the company either in written or electronic form. Phone numbers and e-mail addresses of original team members are listed for further help and explanation. One leading international manufacturing company holds an annual conference attended by more than 3,000 quality team leaders. Each must present one detailed case study. They must also select four examples of major improvements from the other 3,000 that they will take back to their own location and implement quickly.

Some companies make replication part of the job. Before a team can close out a project, they must explore other parts of the organization with similar opportunities. They may offer to work with management or similar teams in other locations to accelerate the transfer of knowledge. They become a type of strike force driving bottom line results through multiple replications of the same solution.

Some companies mandate replication. Known solutions must be implemented. People are expected to use the best quality management procedures exactly as they are expected to use the best technology available.

Some companies have been disappointed with their bottom-line results from quality management. Accelerating replication of results is one of the best ways to accelerate profits.

About the author . . .

A. Blanton Godfrey, Ph.D., is chairman and CEO of Juran Institute Inc. in Wilton, Connecticut. Send comments, suggestions or questions about this column either to the editor or directly to Godfrey at Juran Institute, 11 River Road, Wilton, CT 06897, by fax (203) 834-9891 or on the Internet at http://www. juran.com.