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Last Word
Philip B. Crosby

Creating a Reliable Organization

It's not hard to do things right the first time, but dedication is a requirement.

Management's first priority is to create a useful and reliable organization. The quality professional's primary concern is to help with the reliable part of that equation. Achieving this goal isn't difficult, but it does require sound philosophy and technique.

 Managers and quality professionals need to understand what they have to do to create this reliable organization in which transactions are done correctly, relationships are successful and transactions are completed correctly the first time. This requires deliberately creating a culture designed to produce the desired results. This culture is constructed of a basic quality management philosophy supported by action components.

 The Boy Scouts of America provides an example we can use to better understand what it takes to create a useful and reliable organization. The philosophy behind Scouting is very clear. Scouts promise: "On my honor, I will do my best to do my duty to God and my country and to obey the Scout Law; to help other people at all times; to keep myself physically strong, mentally awake and morally straight."

 An understandable list of requirements makes up the Scout Law: Scouts must be trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent. All of these are very specific, and their deeper meaning is discussed in regular meetings.

 The action items for the Scouts are called merit badges. There are at least 125 different badges, ranging from agriculture to woodwork. Scouts are expected to learn many of these skills, and they achieve recognition when they do.

 Organizations and professionals alike can learn from this approach, particularly when it comes to quality. Most organizations concentrate on the "merit badge" subjects of quality before they go about building a culture. This impatient approach produces a "flavor of the month" cycle, which accomplishes little but keeps everyone busy. Few people seem to be concerned that very little gets accomplished as long as they're getting the "badges."

 Quality professionals who want their company to be known as useful and reliable have to give this thought some consideration. In today's world economy, only those considered useful and reliable will survive. After all, when everyone is certified to ISO 9000 or something similar, what makes companies different from each other? Performance, that's all.

 The philosophy of the useful and reliable culture comes from four continuing considerations: policy, education, requirements and insistence. After achieving these we can use the "merit badge" components (ISO 9000, Black Belt programs and more), which are quite valuable when installed in a company that has a sound philosophical base. The essentials of a reliable organization are as follows:

  The policy for quality is "We will deliver defect-free products and services to our customers and co-workers on time." This eliminates any misconceptions that there's permission to do things wrong. It encourages all employees to respect their customers and co-workers by doing what they say they will do. Management has to announce, publicize and use this policy.

  The education provides the common language based on what I call the "Absolutes of Quality Management":

1. Quality is defined as conformance to requirements. Most think of it as "goodness," which is a matter of opinion and comparison. "Goodness" is impossible to communicate to the employees and suppliers who actually perform the transactions that make the organization work.

2. Quality is accomplished through a culture of prevention. Appraisals, no matter how scientific, bind us forever in a world of corrective action.

3. Quality has a performance standard of zero defects. Scout Laws permit no nonconformances. Allowing 3.4 scouts per million to be untrustworthy, for example, would undermine the integrity and credibility of the entire organization. Acceptable quality levels condemn a company to delivering shoddy products and services.

4. Quality is measured by the price of nonconformance (PONC). When management sees the figures on how much it costs to do appraisal, corrective action, rework, customer service and such, they become born-again preventers. Twenty-five percent of revenue is a common figure for PONC. A prevention-oriented culture can cut that in half in one year.

 

  The requirements describe the work of the organization from needs down to the actual work transactions. It's up to management to ensure that the customer's needs are being described by acts that produce useful and reliable outputs.

  The insistence comes from management showing by example that the policy, education and requirements are taken seriously. They need to start and end their meetings on time, keep their word, treat others with respect, and be consistent.

 

 Quality is a serious part of the success of any organization, and if it's not philosophically integrated in the day-to-day work life, it won't happen. Quality is a result, not an appendage. Management and quality professionals have to work together to build it into the culture of the organization--and then nurture it.

 

About the author

 Philip B. Crosby, founder of Philip Crosby Associates (now PCA II), is also the author of 14 books. Visit his Web site at www.philipcrosby.com . .

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