Perception Counts
Quality initiatives won’t help if customers don’t value your product or service.

H. James Harrington

I began writing this article at the ninth annual Asia Pacific Quality Organization conference that took place last October in Mexico City. APQO is an umbrella organization made up of nonprofit quality organizations that border the Indian and Pacific oceans. Two things that set this conference apart from others of its kind were the CEO Only Forum and the International Asia Pacific Quality Awards presentation.

The first day’s activities were cosponsored by the International Academy of Quality and focused on a group of CEOs and COOs. These executives explained which of their quality approaches were producing results and what problems they were encountering. We then divided into discussion groups to answer the question, “What needs to be done by government, education and the private sector to improve the perception of the quality of Mexico’s products?” The groups came up with the following suggestions:

Organizations need training customized to the individual’s needs.

The government should develop a plan to improve the country’s infrastructure.

Better-trained teachers

Quality training should begin at the grade-school level.

The government should launch a public relations program to make Mexicans aware of the high quality and performance built into Mexican products and services. (Mexicans prefer to buy products that aren’t made in Mexico.)

A cultural change must occur throughout the country.

Another exercise we engaged in was evaluating the following questions on a scale of one to 10, with one being “very poor” and 10 being “the very best”:

How would a consumer in a major developed country rate the quality of Mexican products? (The average answer was 7.8.)

How would you rate the quality of Mexican products? (The average answer was 8.4.)

How would the consumer in Mexico rate Mexican products? (The average answer was 6.7.)

If I were to answer these questions, I’d rate them much lower. In fact, my view of Mexican products is that they’re of below-average quality. How would you answer the first question? Let me know so I can give these executives some feedback. I hope I’m wrong and they’re right.

Quite a lot of discussion concerned this subject, and it was generally agreed that some Mexican organizations produce excellent products. For example, the country produces some of the best beer, and a successful Mexican tire manufacturer produces tires for most of the well-known tire companies, including Michelin and Firestone.

The Mexican government is requiring all its offices to reach a minimum of 550 points, using a measurement system similar to the Malcolm Baldrige National Quality Award, by the end of 2003 and to reach the 600-point level by the end of 2004.

However, there’s a big difference between actual product quality and a consumer’s perception of a company’s or country’s quality, as illustrated.

An organization must sustain improved quality for at least two buying cycles before a customer’s perception of the organization changes. (It took Japan more than 20 years to develop its reputation for producing high-quality products.) It’s equally true that a customer’s perception also plummets when the organization’s product quality deteriorates. Is customer perception so important? You can bet your home on it. In fact, it’s the only thing that’s truly important. All Six Sigma calculations are meaningless if customers don’t perceive your product or service as valuable to them.

After the opening ceremony, the program focused on presenting the International Asia Pacific Quality Award. This is a quality award modeled after the Baldrige Award, with one big difference: To be considered for the award, an organization must have already won its national quality award. Organizations from countries that border the Pacific and Indian oceans, including the United States, Vietnam, Japan, China, Canada, Philippines, Mexico, Australia, India, South Korea, Chile and New Zealand, are eligible for the award. It’s awarded in three categories:

Small manufacturing organizations with fewer than 250 employees

Small service organizations with fewer than 250 employees

Large service and manufacturing organizations

The International Asia Pacific Quality Award recognizes organizations at three levels. The highest level is winning the IAPQA itself. Organizations that accumulate more than 600 points but aren’t the highest in their category are awarded the IAPQA--Best of Class Award. Those organizations that have fewer than 600 points but are above a preset point score receive the IAPQA--World Class Award.

This year’s award winners were:

IAPQA winner

Small manufacturing--Cebadas y Maltas, S.A. de C.V. of Mexico

Large manufacturing--Indo Gulf Fertilisers of India

IAPQA--Best of Class Award

Large manufacturing--Hirdaramani of Sri Lanka

Large service organization--Asia Commerce Bank of Vietnam

IAPQA--World Class Award

Garment Company 10 of Vietnam

Hoceratec of Vietnam

Agrimex of Vietnam

This is the third year of the IAPQA awards and no U.S. company has won one to date. I’m surprised at this because I believe that U.S. organizations are among the best in the world. Moreover, I believe we shouldn’t be reluctant to compare our performance and quality systems to any other country’s organizations.

About the author

H. James Harrington is CEO of the Harrington Institute Inc. and chairman of the board of Harrington Group. He has more than 45 years of experience as a quality professional and is the author of 22 books. Visit his Web site at www.harrington-institute.com.

Note: If you’d like more information about the award and how to apply for it, e-mail Jose F. Gonzales Prado at imecca@interflow.com.mx or imecca@prodigy.net.mx.