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   Quality Management                by A. Blanton Godfrey

Quality in Shipping

Shipping companies lead the trend toward converging quality, safety and environmental protection...

In July 1, the first phase of the International Management Code for the Safe Operation of Ships and for Pollution Prevention became international law. To mark the occasion, a special conference on quality in shipping was held in Athens, Greece. Certain types of ships must implement the code at once; for others, the code will become mandatory July 1, 2002.

For some time, quality, safety and environmental management in shipping have been converging. Many shipping companies have combined quality, safety and pollution control under one department or senior director. And two of the world's leading organizations in assessing ship safety, Det Norske Veritas and Lloyds, have become leaders in assessing quality for various industries through the ISO 9000 standards.

Shipping's basic and advanced quality management concepts and methods have been widely applied in other industries. Beginning in the days when Venice ruled the waves for more than 800 years, shipping has preceded other industries in quality ideas and implementation. The reasons are obvious. Shipping always has been a highly dangerous and challenging business. Every time crews go to sea, they stake their lives on the quality of their ships and the crew's performance.

The Venetian navy and merchant shipping fleet created a complex and highly effective quality management system. Generation after generation of craftsmen worked on highly specialized and increasingly skilled tasks. Mast makers, oar makers and ordnance specialists passed along their skills from father to son. The most skilled craftsmen gained entry into the well-paying, special service of the rulers continuing the trade.

During World War II, Joseph M. Juran served as assistant director of the Lend-Lease program. He soon discovered that the logistics of moving the correct goods from U.S. plants to allies in Great Britain and Russia proved to be so complex that shipments often arrived in the wrong place. Working with a team of generals, admirals and plant managers, Juran soon discovered that the program's 18 different forms, requiring constant retyping and re-entering of data, was causing the problem. The system had become so complex that it was close to impossible to get the right shipments to the right customers.

A few years ago, a major shipping company came to Juran with an almost identical problem. It was transporting containers from Europe to Japan, crossing the United States by rail en route. The errors in loading and unloading containers, and scheduling ships and trains were destroying the company's competitive advantage. Juran laughed and told the amazed executives about solving the problem nearly 50 years before. Like the Lend-Lease program, this company had created a nightmare of multiple forms and data re-entry, and needed to simplify its process so that all involved could get it right.

 In recent years, many shipping companies have adopted total quality management for competitive reasons, which has helped make lean thinking and process management commonplace. Understanding that customers want accurate shipments delivered on time, not multiple contracts with multiple shippers, has prompted many firms to become logistics experts. Sometimes driven by shipping companies, sometimes by railroads and other times by true logistics organizations, new transportation partnerships are providing one-stop shopping for businesses needing to distribute goods worldwide.

One railroad, for example, delivers coal to electrical power plants by managing the coal purchasing, rail shipment on its trains, sea transport and rail shipment in the destination country. Another railroad has partnered with a steel company to design special loading platforms and cranes in the steelyard, and special rail cars and loading docks at the shipyard, to cut transit times dramatically.

One shipping company actually owns no ships. Instead, rooms full of highly trained specialists lease ship space or entire ships, coordinate rail shipments and provide safety and environmental quality management to move goods between continents for their demanding customers.

Even ports are beginning to examine the transfer processes from ships, trains and trucks, and greatly reduce handling times, damages and labor. The U.S. Customs Service is a leader in government quality efforts. It has developed procedures for minimizing delays at border crossings by using electronic manifest transfers for pre-inspections. Customs also works closely with air shipment companies such as Federal Express to conduct its sample inspections in the same tight schedules for plane transfers that FedEx requires for on-time deliveries.

In many ways, shipping companies lead the trend toward converging quality, safety and environmental protection. They are pioneering lean thinking and building working partnerships of multiple companies to eliminate unnecessary steps, wasted effort and time. They are becoming truly customer-focused.

About the author

A. Blanton Godfrey is chairman and CEO of Juran Institute Inc. at 11 River Road, Wilton, CT 06897.

© 1998 Juran Institute. Contact Godfrey at fax (203) 834-9891 or e-mail agodfrey@qualitydigest.com .


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