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First Word
Scott Paton

Oh, brave new e-world…

…that has such poor quality in it.

I'm writing this column from the window seat of a United 757 on my way home from the American Society for Quality's Annual Quality Congress in Indianapolis. As I watch the clouds pass by, my head whirls with the changes I saw at this year's show.

 Of course, Six Sigma is still the rage, but the real buzz on the show floor was about e-commerce. If you believe the exhibitors, you'll be buying your next gage, software package or training program online. I haven't seen so many e's since I was a kid at Walt Disney World.

 This "e" mania got me thinking about quality in an e-world. It's relatively easy to measure a part, but it's not so easy to measure quality in the e-world. Take Philip Crosby's definition of quality: conformance to requirements. It's easy to determine what the customer's requirements are and if we're meeting them in the manufacturing world. It's slightly more complicated in a service environment. How do we know what the customer's requirements are and if we're meeting them in the e-world? Determining this should be fairly straightforward. Unfortunately, the dotcoms seem to be more interested in stock value than in quality levels.

 The difference in quality levels between service and e-commerce is startling. The numbers speak for themselves: According to a recent article in Business 2.0 magazine, $7.3 billion was spent on online holiday shopping in the fourth quarter of 1999. Unfortunately, Internet retailers failed to deliver 16 percent of orders (an e-mazing $1.17 billion worth of goods). An additional 24 percent of orders were delivered late. Those of you who supply the Big Three know full well what the consequences would be if you delivered 24 percent of your products late! Forget Zero Defects. Forget Six Sigma, which measures defects per million. These e-tailers are working with 40 defects per hundred!

     Even more shocking: According to the same report, of the customers whose orders were delivered late, only 38 percent were notified in advance that there would be a delay; only 68 percent got a reason for the delay at all.

 Should we be shocked? Who's running these dotcoms anyway? They're the playgrounds of young entrepreneurs with little business and no quality experience. (I don't recall meeting the quality manager from a single dotcom at the AQC.)

 The abysmal state of e-quality reminds me of the post-World War II glory days when we could sell any piece of junk no matter how bad it was simply because we were the only game in town.

 What's it going to take to rouse the e-tailers? I don't think Japan Inc. will awaken the sleeping bear this time. The NASDAQ recently goosed investors with a healthy dose of reality; the plunge in the tech-heavy stock exchange in the first two quarters of this year has given a wake-up call to the dotcoms that there's life beyond the stock value.

 Enter the second wave of e-commerce: profit models replacing stock value models. There aren't many profitable organizations that fail to deliver 16 percent of their orders. Why should e-commerce be different?

 This is good news for the legions of quality consultants out there. Perhaps someone will come up with a snappy new term for e-quality improvement: Three E? Quadruple Quality? Triple W? If only we could sneak in a Greek letter and a few martial arts terms.

 Share your thoughts on this brave new e-world by e-mailing me at .

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