The Complete Quality Process is Two Years Old

Pat Townsend & Joan Gebhardt
ptownsend@qualitydigest.com

Regular readers of this column know that one of the authors (Pat) is the director of a quality process for an insurance company in the Fort Worth, Texas, area. After a six-month lead-in, the Quality First process was officially launched on Sept. 14, 2000--meaning it just had its second birthday.

First, a few facts about the process--and then the results after two years.

Pat arrived there on Feb. 3, 2000; after a series of conversations and classes, the management team voted unanimously to proceed with the process in late March. The process was in place, functioning and bringing benefits to the bottom line by the end of September 2000.

The approach used is called a complete quality process. One of the distinguishing characteristics of a CQP effort is 100-percent employee involvement: the active enrollment of every person on the payroll on a quality team--right from the beginning.

The seven components of a CQP effort are: top management commitment; leadership; 100-percent employee involvement with a structure, communications, training, measurement; and recognition, gratitude and celebration.

There are now approximately 1,000 people on the payroll of the company; two and a half years ago, there were about 850. Sales income has increased by more than 200 percent--with the quality process being recognized as a major contributing factor to the company's ability to handle the rapid growth.

The quality department consists of three people.

The normal sequence for the core activity of the process is:

1) A quality team makes a decision about how to improve some aspect of the work for which they are responsible.

2) After making all appropriate investigations and before and after measurements, they implement the idea and notify the quality department via the home-grown quality idea tracking program.

3) A quality analyst researches the idea both for validity and for financial/time impact and, if appropriate, certifies the idea.

4) At appropriate points (based on the number of certified ideas and/or the financial impact of those ideas), the quality team is recognized and thanked by the company president.

Results for the first two years:

The financial impacts are computed on an annualized basis, unless the idea involves a one-time occurrence, such as a decision to not spend a specific amount of money on a particular thing or service. "Soft dollars" are a function of time--with time valued at $15 per hour. In quality year one, for instance, $3,313,095.31 in soft dollars is the equivalent of more than 220,000 hours of work that no longer needs to be done. At 2,000 hours per work year, that means that 110 people didn't need to be hired because the work they would have done was no longer needed. There were no lay-offs; the company payroll simply didn't grow as quickly or as much as it might have.

Lessons learned during the first two years:

The involvement and open support of the president of the company is invaluable.

One-hundred-percent employee involvement from the outset is not only possible, it's the logical approach because otherwise an organization must answer the question, "Who do we hope never gets any better at what they do?" How else can a decision be made on which people to leave out?

Pursuit of quality means keeping a lot of things going at one time.

People enjoy being thanked, and a varied, generous recognition program has a great return on investment.

Beginning a quality effort by first engaging all of the people in the organization in the attempt to improve everything the company does secures the commitment of the employees to a long-term effort.

As described in a recent column, the philosophy to describe this approach is "quality from the inside out." Rather than trying to force quality down an organization's collective thought by demanding certain measurements and then using that data to dictate changes, the effort has been to engage every person in the company to look for ways to improve whatever piece of the company they are in--and being thanked when they do.

These first two years may be thought of by some as time spent "picking the low-hanging fruit," but remember, this process was functioning less than six months after management committed to the idea. Time that many companies spend planning was already being used to make improvements. Adding to the value of the approach is the fact that there is no back-sliding; individuals and quality teams hold the gains. Why? Because the changes were their ideas; they understood why they made the change and how it benefited them and the company.

As the company moves into the third year of the Quality First process, plans are being made to increase the training of the team leaders to give them more tools in the way of process discipline and sophisticated measurement methods. Think about it this way: They've picked most of the low-hanging fruit. Next they will be provided with ladders and other tools so that they can get at the really good stuff.

About the authors

Pat Townsend and Joan Gebhardt have written more than 200 articles and six books, including Commit to Quality (John Wiley & Sons, 1986); Quality in Action: 93 Lessons in Leadership, Participation, and Measurement (John Wiley & Sons, 1992); Five-Star Leadership: The Art and Strategy of Creating Leaders at Every Level (John Wiley & Sons, 1997); Recognition, Gratitude & Celebration (Crisp Publications, 1997); How Organizations Learn: Investigate, Identify, Institutionalize (Crisp Publications, 1999); and Quality Is Everybody's Business (CRC Press, 1999). Pat Townsend has recently re-entered the corporate world and is now dealing with "leadership.com" issues as a practitioner as well as an observer, writer and speaker. He is now chief quality officer for UICI, a diverse financial services corporation headquartered in the Dallas area. Letters to the editor regarding this column can be sent to letters@qualitydigest.com.