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This Month in News Digest


Customers Generally Happy With Automotive Industry


Count Down to ISO 9001:2000 Transition


Baldrige Supporters Push for Not-for-Profit Category, End to Award Cap


Building Homes on a Foundation of Quality


Employees in “Rational Endurance” Mode


Industry News

Customers Generally Happy With Automotive Industry

Although customer satisfaction remains steady for the automotive industry, according to the American Customer Satisfaction Index, individual car companies that once thrived are waning.

For the fourth consecutive year, the automotive industry matched its ACSI record score of 80 (on a 100-point scale). Among individual car companies, however, there are several significant changes. Hyundai continues its climb in customer satisfaction from an industry-low score of 68 in 1999 to 81 this year. Cadillac remains at the top with a score of 87, followed by BMW with 85, Toyota with 85 and Buick with 84. Pontiac and Volkswagen, which each dropped 7 points from last year, fared lowest with 76 points.

“With sales and quality lagging in the past, Cadillac seems to have now hit its stride with gains in sales and a customer base no longer at or near retirement age,” says Claes Fornell, director of the University of Michigan Business School’s National Quality Research Center, which compiles and analyzes the ACSI data. “As Cadillac reaches younger and more affluent customers, the importance of satisfaction and buyer loyalty will take on new significance.”

Jack West, past president of the American Society for Quality and co-sponsor of the ACSI, says the gap in customer satisfaction between a company like Cadillac and a company at the bottom, is shrinking.

“Throughout the 1990s, the difference between the top and bottom automakers in the ACSI was 18 or 19 points, but in the last four years, it’s been no more than a dozen points,” he says. “This shrinking differentiation is even more pronounced when comparing domestic car companies with European and the Japanese companies, which are now back on top in customer satisfaction--but not by much.”

The ACSI is a national economic indicator of customer evaluations of the quality of products and services available in the United States. It’s updated quarterly with new measures for different sectors of the economy replacing data from the previous year.

Overall customer satisfaction, which has moved steadily upward for the past two years, remained constant last quarter. Following a first-quarter surge of 1.2 percent to a score of 73.8, the ACSI was unchanged for the second quarter.

“Although a climb may be preferred over a stable index, the ACSI improvements over the past 21 months cannot be dismissed by a three-month halt,” suggests Fornell. “From the perspective of the economy’s capability to generate buyer satisfaction, the outlook must be viewed as moderately encouraging.”

During the second quarter, four manufacturing durables industries were measured: automobiles, household appliances, consumer electronics and Internet e-business (i.e., Web portals, search engines and news sites). Only household appliances showed a decline in customer satisfaction. However, with a score of 81, it’s still nearly 10 percent higher than the aggregate ACSI for all industries. Kenmore, the most popular brand, topped the industry with a score of 84, followed by Whirlpool (82), General Electric (81) and Maytag (81).

Among PC companies, Dell leads the way for the sixth straight year, with an ACSI score of 78. Apple, up six percent, is right behind with a mark of 77, and the fall of Gateway continues--its 69 score is down 12 percent from its peak of 78 in 2000.

“In a market dominated by Dell and Hewlett-Packard, Gateway faces a difficult challenge,” notes Fornell. “Service expertise, which used to be Gateway’s strength, has seen better days, according to customers. The company has reported negative net income and falling revenue the past five quarters.”

Overall, the e-business score jumped four percentage points, from 68.7 last year to 71.4 this year. Among portals, Yahoo! scored highest in customer satisfaction, with a mark of 78, followed by MSN (74) and AOL (65). The latter bettered its score by 10 percentage points, a rise that can largely be attributed to an improved home page and software, major upgrades in virus protection, and better messaging capabilities and e-mail services, Fornell says.

In the search engines category, Google continues to dominate with an ACSI score of 82, compared with Ask Jeeves’ 69 and Alta Vista’s 63. Among news and information sites, the collective ACSI score was 74.

To see all the scores and to read more commentary by Fornell, visit www.theacsi.org.


Countdown to ISO 9001:2000 Transition

Baldrige Supporters Push for Not-for-Profit Category,
End to Award Cap

Members of the National Baldrige Coalition, a group of supporters of the Malcolm Baldrige National Quality Award, have recently stepped up efforts to achieve two longstanding goals: expanding the award to include a not-for-profit category and eliminating the cap on the number of awards.

Because the Baldrige National Quality Program is established as a law (Public Law 100-107), any changes to the program must be made legislatively. A letter signed by more than 400 Baldrige supporters was delivered to senators John McCain and Ernest Hollings and representatives Sherwood Boehlert and Ralph Hall, the chairs and ranking members of the authorization committees for the National Institute of Standards and Technology in both the Senate and the House of Representatives.

Signers of the letter include former Baldrige Award winners, examiners, overseers, judges and Baldrige Foundation board members, all of whom want to make it possible for not-for-profit organizations to apply for the national award.

The effort will concentrate on achieving authorization for the changes in fiscal year 2004 and funding to implement the changes in fiscal year 2005.

There are currently three types of not-for-profit organizations not currently eligible to apply for the award. They are:

Public agencies of federal, state and local governments

Independent-sector, private not-for-profit organizations, such as human service, religious, cultural or trade, and professional associations

Quasi-public organizations created by legislative authority, such as public utilities, cooperatives, mutual insurance companies and credit unions

Another concern is the cap on the number of award winners per category per year. The letter asserts: “If Congress acts to eliminate the caps, you will help to avoid the potential travesty of having a worthy organization denied an award for the sole reason that it was one of more than three applicants in a given category that the Baldrige judges determined met the standard of excellence represented by the award. As long as the cap exists, this possibility exists.”

To view the letter in its entirety, visit www.asq.org.

Building Homes on a Foundation of Quality

When D.R. Horton, a home building company in North Carolina, decided to improve quality throughout the organization, it wanted to ensure that its partners would do the same. So, the company turned to the National Association of Home Builders’ Research Center.

Known as America’s housing technology and information resource, NAHB Research Center, a subsidiary of the National Association of Home Builders, provides product research and building process improvements that have been widely adopted by home builders in the United States.

In 1991, the NAHB Research Center introduced the National Housing Quality Certified Trade Contractor program. A certified builder program was initiated in late 2002 with funding assistance provided by the public-private Partnership for Advancing Technology in Housing program, which is administered by the U.S. Department of Housing and Urban Development.

After requiring that its trade contractors become certified, D.R. Horton reaped the benefits of the quality improvement initiative. “We saw improvements in job site readiness throughout the construction process, a remarkable improvement in the general quality of individual contractors’ work and an improved overall attitude,” recalls John Nance, vice president of construction and warranty for the Central Carolina division of D.R. Horton. “Our trade contractors seemed to have an increased sense of pride and ownership of their work after completing the training and starting the certification process.”

Certification training through the NAHB Research Center consists of three one-day training sessions, spaced a few weeks apart. The process focuses on areas of the contractor’s business practices that need improvement and helps develop the tools necessary to exceed in customer satisfaction. Certification is achieved after three months of operating the quality system. Companies must pass a certification audit and then be audited annually to maintain certification. Audits include an examination of the company’s systems and a job site inspection.

The NAHB Research Center Web site offers a searchable database of certified contractors. Also available are an insulation contractor certification program, quality management resources, and information on the National Housing Quality Award. To learn more about NAHB Research Center and its programs, visit www.nahbrc.org/quality.

Employees in “Rational Endurance” Mode

U.S. workers remain focused on their jobs despite the tough economic climate, job layoffs and other business challenges of the last two years, according to recent research from Towers Perrin. Employees of medium-sized to large organizations are in a mode of “rational endurance”--doing what is required to help keep both themselves and their companies afloat. However, the study also shows that relatively few of the employees surveyed exhibit high levels of engagement in their jobs.

“Employees are getting the job done, which has a lot to do with a sense of enlightened self-interest on their parts,” says Charlie Watts, head of Towers Perrin’s Organization and Employee Research consulting practice. “But their resiliency doesn’t equate with true engagement. Engagement, which we define as employees’ willingness and ability to contribute to company success, ultimately comes down to people’s desire to give discretionary effort in their jobs.”

The bulk of employees surveyed are only moderately engaged, according to the study. In fact, only a small percentage are highly engaged, meaning they’re both willing and able to invest an extra level of discretionary effort that separates outstanding performers from others.

“Working Today: Understanding What Drives Employee Engagement, the Towers Perrin 2003 Talent Report” drew responses from more than 35,000 employees in the United States.

The study identifies a list of workplace elements that are critical in building engagement among employees, including strong leadership, personal accountability, autonomy, a sense of control over one’s environment, and opportunities for advancement.

Another finding is that a highly engaged workforce is likely to be more stable. Two-thirds of highly engaged employees have no plans to leave their current jobs, vs. 36 percent of the moderately engaged and only 12 percent of the disengaged.

The research identifies a set of attributes that, in combination, are critical to building high engagement. It also tells employers how workers think they’re doing in each of these areas.

“The key for employers is to understand which employees are most critical to the organization and then determine their levels of engagement,” Watts notes. Learn more at www.towersperrin.com.


Retailers Emphasize Quality

A July 22 article in the New York Times reports that many retailers are banking on quality to sell during the “back-to-school” season. “Back to School Survival: Sales are Thin, Customers Bored; It’s time for ‘Quality’” points to an emphasis on upgraded fabrics and more stylish merchandise. One retailer of children’s clothing is offering improved fit and softer washes on jeans at the same price as last year. A shoe manufacturer is adding more moisture-control material in its athletic shoes. “Merchants have little choice but to deliver more and better merchandise; increasingly, they concede, the old formulas are not working,” the article states.

Teams Wanted for Excellence Awards

The Association for Quality and Participation, an affiliate of the American Society for Quality, is gearing up for another year of its Team Excellence Award program.

The Team Excellence Award offers international recognition for an organization’s team-based improvement efforts.

Nominees are judged against 36 team evaluation criteria. Finalists will be selected for live presentations at a joint AQP/ASQ conference, slated for next year. The updated timeline is as follows:

The due date for team entries--a 25-minute video presentation and documentation--is Dec. 12. Preliminary round entries will be judged during January and February. The joint AQP/ASQ Quality Congress will be held May 22–26 in Toronto. Learn more at www.aqp.org.

Nikon Releases NEXIV VMR-H3030

Nikon Instruments Inc. has released the latest model in the NEXIV line of measuring instruments, the NEXIV VMR-H3030. Touted by Nikon as the fastest, most precise video measuring tool available, the VMR-H3030 serves as a laboratory’s master measuring instrument. Utilizing the newly released VMR-Z120X maximum magnification module, a dual optical system, the VMR-H3030 offers stage scale resolutions enhanced to 0.01 µm and wide-illumination options to ensure precise edge detection in complex parts.

The VMR-H3030 manages a range of inspection duties, including NEXIV’s through-the-lens laser focusing system, allowing users to scan 1,000 points per second on complex profiles of 3-D precision parts. The NEXIV VMR system also features a 15¥ telecentric zoom system to facilitate searches at low magnification. For more information, visit www.nikonusa.com.


Rockwell Offers New Assessment Services

Rockwell Automation has launched a new manufacturing performance assessment program. The new line of assessment tools identifies opportunities for process improvement in maintenance, repair and operations practices. The MPA programs also identify performance issues, establish baseline metrics and outline recommended corrective actions.

The assessment components include machinery condition evaluation, plant baseline evaluation, installed base evaluation and integrated performance tools. “Many manufacturers rely on intuition and experience and assume their processes are designed well enough to meet production goals,” says Mike Laszkiewicz, vice president of asset management for Rockwell. “By assessing the maintenance and engineering process, surrounding activities and supporting resources, we can identify the factors that are inhibiting equipment and operator performance.” For more information, visit www.rockwell.com.

ISSSP Unveils iKnow Knowledge Network

In an attempt to encourage information sharing among the Six Sigma community, the International Society of Six Sigma Professionals now offers the iKnow Knowledge Network. The network is an advanced collaborative information repository designed to deliver comprehensive, credible Six Sigma information to ISSSP members online.

The network will deliver information from a range of Six Sigma disciplines and will include articles, information about useful books, video, audio and PowerPoint presentations, white papers, press releases and industry news, notes from roundtable discussions, focused session archives, upcoming event updates, and case studies. Learn more at www.isssp.com.

ASQ Launches Online Career Center

The American Society for Quality has launched its online Career Center on the organization’s Web site. The Career Center offers access to employers and jobs in the quality industry and provides support to job seekers. Anyone may view job postings for free, and ASQ members may post résumés on the site. Organizations interested in posting a vacant position may do so for $200 per month for each listing.

Individuals who have posted a résumé on the site to receive weekly updates of the new jobs added that match the search résumé criteria specified. The site also features four curriculum programs consisting of a set of core courses and a series of electives, including ASQ’s quality management specialist, quality engineering specialist, quality technician specialist and quality auditor specialist curriculum. For more information, visit the Career Center at www.asq.org.