This Month in News Digest

2002 Baldrige Winners Include Health Care Organization

President George W. Bush and Commerce Secretary Don Evans have announced the three organizations that will receive the 2002 Malcolm Baldrige National Quality Award. For the first time in the award's history, an organization has won in the health care category.

The 2002 winners are Motorola Inc.'s Commercial, Government and Industrial Solutions Sector of Schaumburg, Illinois (manufacturing); Branch-Smith Printing Division based in Fort Worth, Texas (small business); and SSM Health Care from St. Louis (health care).

"The three 2002 Baldrige Award winners are role models of world-class excellence, and they've achieved extraordinary results," says Evans. "The men and women of these organizations represent the highest ethical standards in public responsibility and corporate stewardship. I'm particularly pleased to join the president in announcing a first-time winner in health care." The health care category for the Baldrige Award was introduced in 1999. Since then, 37 health care organizations have submitted applications, including 17 in 2002.

Motorola Inc.'s Commercial, Government and Industrial Solutions Sector provides integrated communications and information solutions to public and private organizations, including fire and police, military, public service and business enterprise organizations. The company specializes in radio networks, systems, products and services; integrated communications technology and information technology solutions; and commercial and industrial radio products.

"Earning the Baldrige Award acknowledges the rigorous quality disciplines in the Motorola business unit that serves the world's homeland security communications needs," notes Chris Galvin, Motorola's chairman and CEO. "This marks an outstanding example of the exciting, substantive and positive performance changes that are being led in Motorola today."

One of two divisions within Branch-Smith Inc., Branch Smith Printing Division is a fourth-generation family business. BSPD specializes in turnkey services related to sheet-fed printing of multiple bound materials, including designing, printing, binding and mailing. BSPD, which employs 68 people, received the Texas Award for Performance Excellence in 1999.

Sponsored by the Franciscan Sisters of Mary in St. Louis, SSM Health Care is a Catholic not-for-profit health system of hospitals and health-related groups in Missouri, Illinois, Wisconsin and Oklahoma. The organization, which employs about 22,000 people, has been using the Baldrige model for performance excellence for more than seven years, according to Sister Mary Jean Ryan, CEO of SSM Health Care.

The winning organizations will receive their awards during the ceremony scheduled for later this year.

Named after the 26th secretary of commerce, the Malcolm Baldrige National Quality Award was established by Congress in 1987 to enhance the competitiveness of U.S. business by promoting quality awareness, recognizing the quality and performance achievements of U.S. organizations and publicizing successful performance strategies.

The Baldrige program is managed by the National Institute of Standards and Technology. For more information, visit www.quality.nist.gov.

Quality and Performance Achievements

Motorola Inc. CGISS

Seven-percent return on assets, compared to a negative average among telecommunications organizations as a whole

Participant in the Occupational Safety and Health Administration's Voluntary Protection Program

ISO 14001-compliant at all manufacturing sites worldwide

Greater than 88-percent customer satisfaction (repurchase/recommend)

Organizationwide intranet data and information system

Branch-Smith Printing Division

Sales growth rate of 72 percent over four years

Market share in the Dallas-Fort Worth area has tripled from 1997 to 2002.

Systematic customer complaint process, including satisfaction surveys and regular meetings with key customers

Customer increase from 91 in 1998 to 167 in 2002

Value-added sales per employee has increased 33 percent in five years.

SSM Health Care

Eighty-five "Clinical Collaborative" teams in 2002, up from 14 teams in 1999

Healthy Communities initiative leverages SSM's resources with those of the commu- nities it serves.

Market share in the St. Louis area has increased 18 percent during the past three years.

Formal patient satisfaction surveys, patient follow-up calls and an Internet response system

Thirteen-percent employee turnover rate in 2002, compared to 21 percent in 1999

Customer Satisfaction High Despite Low Consumer Confidence

Low consumer confidence, as evidenced by a shaky economy, has not translated into low customer satisfaction, according to the results of the latest American Customer Satisfaction Index. Customer satisfaction slightly increased since the second quarter of 2002, from 73 to 73.1, and the third quarter results--measuring nondurable goods--rose from 80.3 to 81.4 (of a possible 100 points).

"Clearly, customer satisfaction is different from consumer confidence," explains Claes Fornell, professor of business and director of the University of Michigan Business School's National Quality Research Center, which compiles the ACSI data. "A person can feel less confident about the state of the economy, yet be more satisfied with his or her purchases."

ACSI's manufacturing nondurables index includes eight sectors: food processing, beverages (beer), beverages (soft drinks), tobacco/cigarettes, apparel, athletic shoes, personal care products and pet foods. Among those sectors, both beer and soft drink satisfaction increased about one point from last year. And, although the food processing sector recorded a 1.2 percent overall decline, customer satisfaction is up for both Hershey Foods Corp. and Sara Lee Corp.

"Companies that, in one form or another, sell sweets or alcoholic beverages have higher satisfaction scores," notes Fornell. "This is consistent with the notion that when people are anxious, as suggested by the low consumer confidence numbers, they appear to take a bit more comfort in inexpensive pleasures such as sweets and alcohol."

Tobacco/cigarettes satisfaction remains strong at 76, although scores for this sector have decreased each year since ACSI's 1995 inception, from a one-time high of 81. However, discount brands have shown improvement during this time. "Discount brands now account for almost 10 percent of the market, up by almost 400 percent since 1997," notes Fornell. "With declining satisfaction and large price hikes for premium brands, pricing power may have reached a ceiling. Consumption has dropped, but the reduction in demand has been proportionally less than the increase in price."

The apparel sector rose from 79 to 80 points, personal care products declined from 83 to 81 points, and pet foods held steady at 82 points. "The pet food industry is different in the sense that it's the only industry in the ACSI for which the opinion of the actual user isn't sought," notes Fornell. "The pet owner's experience is measured."

Does this slight increase in customer satisfaction mean a subsequent increase in spending? Not necessarily, says Fornell. "There are quite a few factors that suggest a postponement in expenditure growth," he says. "For example, automobile sales have slowed, retail is mixed, preliminary spending numbers are down, and unemployment is up."

ACSI is produced through a partnership among the University of Michigan Business School, the American Society for Quality and the CFI Group. For a look at all ACSI scores, visit www.theacsi.org.

Mitutoyo Names New President

Mitutoyo America Corp. has appointed Tsuyoshi Yamamura as its new president. Yamamura will be responsible for day-to-day operations of the U.S.-based sales and service subsidiary.

Yamamura began his career with Mitutoyo in 1970 in the Overseas Sales department. He helped establish Mitutoyo Asia Pacific, the company's Singapore-based sales and service operation. Yamamura then served in the company's Tokyo headquarters. He was most recently executive vice president of Mitutoyo America.

He will take over the responsibilities of former president, Noel Ryan.

Mitutoyo is a global leader in precision measuring and metrology technology, serving manufacturers with more than 6,000 precision measuring tools and instruments for dimensional gaging, including coordinate, roundness and vision measuring. For more information, visit www.mitutoyo.com.

Correction

In the December 2002 issue of Quality Digest, the article "Evaluating Calibration Software" was inadvertently attributed to Kim Ditloff. The author's name is Kim Rosenstein.

ISO Appoints New Secretary-General

The International Organization for Standardization has appointed Alan Bryden as its secretary-general. His designation came after a unanimous vote of the ISO Council during a Nov. 14 meeting in Geneva. Bryden's post begins on March 1.

Bryden faces many challenges, according to ISO, as international standardization is called upon to respond to globalization of trade and other issues such as sustainable development and the requirements budding information technology.

Bryden is the current director of France's national standardization institute, ANFOR. Prior to his ANFOR assignment, which began in 1999, he was director general of Laboratoire National d'Essais--LNE, a leading French national testing laboratory. He founded Eurolab, the European Federation of Measurement, Testing and Analytical Laboratories, and served as its first president from 1990 to 1996. He also chaired the Laboratories Committee of the International Laboratory Accreditation Cooperation.

Following the sudden death of ISO's previous secretary-general, Lawrence D. Eicher, on March 21, 2002, the organization named Christian Favre, former ISO assistant secretary-general of Administration and Finance as acting secretary-general. He will continue in this capacity until Bryden takes up his post.

ANFOR is an ISO national standards institute representing France. To learn more, visit www.iso.org.

Investments in Quality Make Financial Sense

More often than quality professionals would like to imagine, executives perceive quality initiatives as stumbling blocks to timely operations. Not surprising, says William F. Andreas, the author of "Realizing Return on Investment from Quality Assurance Process Improvement," a white paper from Collaborative Consulting. "Many companies have difficulty attaching a precise, tangible cost or benefit to quality assurance," he says. "As a result, quality assurance is often discarded at the first sign of schedule or budgetary pressure."

The paper, one in a series of point-of-view publications from the company, highlights gains in efficiency and production quality reaped by companies that implement strategic processes to ensure the greatest possible return on investment in the area of information technology. It also illustrates the importance of including quality assurance initiatives in every phase of application development--from design to deployment--rather than performing them at the end of a project.

"Many organizations don't give proper weight to quality assurance; it's not considered as critical as development, deployment or delivery," says Andreas. "In fact, project leaders often abandon QA process enhancement midstream because, without help, the benefits they derive can be difficult to measure."

Andreas emphasizes the importance of using metrics in quality initiatives. "What you cannot measure, you cannot manage," he says. "Many organizations struggle with accurate measurements of the benefits applications provide over time, as well as the costs they incur. A sound quality assurance initiative includes precise metrics--quantified observations of the product or process--which help companies determine the answers to their questions."

The paper addresses quality in terms of requirements, testing plans, testing results, defect tracking and knowledge capture. The author also shows examples of successful quality processes.

To order a copy of the paper, contact Kim Kuzmeskas at (781) 376-9900 or visit www.collaborative.ws.

Small Business Wins European Quality Award

SAM Mouldings, a leading molding manufacturer in the United Kingdom, has earned the 2002 European Quality Award. It's the only one of the 16 finalists across five categories to receive the award.

The Antrim, Northern Ireland-based company, in the small to medium-sized company category, employs 67 people. It manufactures moldings from medium-density fiberboard, primarily used in the home improvement industry.

The European Quality Award is issued after jury members rate organizations on a point scale of 1 to 1,000. The scores are based on the organization's ability to follow the European Foundation for Quality Management's European Excellence Model, a list of nine criteria for achieving excellence in quality, including leadership, policy and strategy, partnerships and resources, processes, people results, customer results, society results, and key performance results.

"Most finalists score highly in most areas," explains Sam McCrea, managing director of EFQM. "However, SAM Mouldings achieved a consistently high score across all nine categories."

The recognition bodes well for small and medium-sized organizations, which make up more than 90 percent of European businesses. "With Europe's manufacturing competitiveness continually being questioned, SAM Mouldings has demonstrated that there is a future for small, focused enterprises in deprived regions which are not afraid to compete aggressively against much better-placed neighbors," adds McCrea.

SAM Mouldings received the 2000 U.K. Quality Award and the 1998 Northern Ireland Quality Award.

There were no EQA winners in 2001, which led EFQM to restructure the application process to provide more in-depth feedback on organizations' key strengths and areas for improvement, a summary score, and comments on their use of the EFQM Excellence Model.

For a list of prize winners and finalists, visit www.efqm.org.

Industry News

QualityData ONLINE Turns One

QualityData ONLINE, a service of Integral Solutions Inc. that delivers quality software over the Internet, has been relaunched with new features to mark its one-year anniversary. The portal is now equipped with an improved interactive product interface and increased security measures.

QualityData ONLINE allows users to access, update and distribute their quality documents from any computer with Internet access. The portal was originally designed to deliver the MPACT Manufacturing Planning and Control Tool. During the past year, ISI has added DPACT Design Planning and Control Tool, APACT Audit Planning and Control Tool, and computer-based training to the site. Learn more at www.integralsolutions.com.

Cogiscan's Control System Updated

Cogiscan Inc.'s Moisture Sensitive Device Control System has been updated to meet the revised joint IPC/JEDEC J-STD-033A standard for control of moisture-sensitive devices. The MSD Control System provides real-time tracking of all moisture-sensitive components, tracking part number, moisture sensitivity level, expiration date, body thickness, category and type. New features ensure that all applicable rules of the new standard are being followed.

For more information, visit www.cogiscan.com.

TUV Rheinland to Provide Certification to Russian Market

TUV Rheinland of North America Inc. has allied with VNIIS, a Russian scientific and research institute for certification, to issue GOST-R certification, which provides approval for North American products intended for the Russian market.

Under the agreement, TUV Rheinland will receive GOST-R applications and VNIIS will commence the approval process. A VNIIS certificate specialist is stationed in TUV Rheinland's North American headquarters to expedite the process.

Details are available at www.us.tuv.com.

Rockwell and InfinityQS Software Combine

Rockwell Automation and InfinityQS International have partnered to provide InfinityQS's statistical process control applications in Rockwell's software, including RSBizWare manufacturing execution software and RSView human-machine interface software.

Initially, Rockwell will resell InfinityQS offerings; the companies are working to develop a software bridge to enable data exchange between their products. Product release is tentatively scheduled for mid-2003.

Details are available at www.rockwellautomation.com and www.infinityqs.com.