We often forget just how far we've come since the first Malcolm Baldrige National Quality Awards were presented 10 years ago. During the past few months, I've made several presentations at international conferences to audiences enthralled by the progress the United States has made in restoring its competitive leadership. For the past six years, the United States has again been ranked No. 1 in international competitiveness.
What did we do to create this incredible turnaround? So much has happened, but it didn't all happen at once. In fact, we spent much of the 1980s gnashing our teeth and blaming others for annual billion-dollar losses, plunging market shares, and failing divisions or companies. Hewlett-Packard published data specifying how U.S.-produced integrated circuits were of much lower quality than their Japanese counterparts. David Garvin received the McKinley Prize for his Harvard Business Review article documenting the dramatic difference between U.S. and Japanese air conditioner manufacturers.
However, blaming gradually gave way to problem solving. The 74th American Assembly, convened Nov. 19-22, 1987, focused on the topic, "Running Out of Time: Reversing America's Declining Competitiveness." The Ford Foundation, the Xerox Foundation and AT&T, three companies that took the United States' competitive decline seriously, funded the conference. Participants included leaders from industry, government, academia, publishing and unions.
The assembly's final report, though harsh, contained recommendations for public and private organizations, individuals and society. "America's economy is growing more slowly than it used to, more slowly than we need it to and more slowly than our competitors' economies," stated the report. "We are consuming far more than we produce and earn, and we are having difficulty paying the bills. Our prosperity is threatened, as is our capacity to provide world leadership and achieve a more just and competitive society."
The report defined basic competitive principles, with quality heading the list. "This does not mean quality merely to specifications, but quality that is characterized by constant innovations," the report stipulated. "It means achieving this attitude from top to bottom, from the boardroom to the factory floor."
Other principles that were cited included low cost, customer-driven businesses, employee involvement and continuous improvement. The report also spelled out what it meant by low cost: "It may seem cheaper to shove as many products or services out as fast as possible, but if quality is ignored, the cost in rework, scrap, supervision and, most of all, disappointed customers will be more expensive than any business can bear."
Since then, the Baldrige Award, 43 state quality awards, successive American Assemblies, hundreds of books, thousands of articles and tens of thousands of quality speeches and workshops all contributed to a revolution in our thinking about competitive advantages in business. The U.S. Chamber of Commerce made these ideas available both to small and large companies. The National Institute of Science and Technology funded research into quality and performance excellence. Business and engineering schools incorporated these ideas into courses and textbooks. The revolution reached out to government, education and health care.
The fundamental principles of quality, low cost, employee involvement, customer-driven businesses and continuous improvement have become so ingrained that we forget they ever were considered revolutionary. Some leaders, instead of realizing how essential quality has become to every organization, now believe that it is dead.
We'd be hard-pressed to find a leading company in the United States today that doesn't pursue these fundamental principles through good training programs, process management and quality innovations throughout the organization. Aggressive goals in all these areas contribute to these companies' strategic and business plans.
Of course, many organizations have yet to catch up to what others have accomplished, but the basic ideas are well-known. For the most part, what we've accomplished in the United States during 10 or 15 short years has been miraculous. We're once again the benchmark in competitiveness in many industries, inflation is low, unemployment sits at its lowest level in more than 20 years, and we're beginning to discuss budget surpluses rather than record deficits.
Many companies have gotten their second wind and are redoubling their efforts to establish new competitive leadership positions through black belt and six sigma programs, lean manufacturing, breakthrough creativity and innovation, and other concepts. We can now truly look forward to the future, which we'll explore in next month's column.
About the author
A. Blanton Godfrey is chairman and CEO of Juran Institute Inc. at 11 River Road, Wilton, CT 06897.
© 1998 Juran Institute. For permission to reprint, contact Godfrey at fax (203) 834-9891 or e-mail email@example.com .