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Quality Decisions in Hindsight July 25, 2016

Posted by Tim Rodgers in Management & leadership, Operations, Organizational dynamics, Process engineering, Product design.
Tags: , , , , , ,

For the last several years there’s been at least one high-profile case of quality failure that captures the attention of the business press for months at a time. Since late 2015 and early 2016 we’ve been watching to see if air-bag supplier Takata, iconic auto maker Volkswagen, and fast food chain Chipotle will survive their highly-publicized quality missteps. There’s always a lot of apologizing to the public, and a commitment to conduct internal investigations to identify and eliminate the causes of field failures. Senior management and boards of directors scramble to regain the trust of their customers.

I’m not at all surprised by the frequency of these events. What surprises me is that these events don’t happen more often. We should expect to continue to hear about similar catastrophic quality problems from otherwise reputable companies despite all the talk about six sigma and customer satisfaction, and despite all the investments in quality improvement programs. It’s the nature of business.

If you have the time and technical expertise and organizational commitment to identify that cause of a quality problem that’s already happened, it’s not that hard to figure out what went wrong. It might be “operator error,” or an incorrect setting on a production machine, or a design flaw that was overlooked. What’s hard for most companies is to continue to ask the “why?” question to get to the real root cause. The people who were involved in designing and producing and delivering the product or service probably already know: quality isn’t a priority.

Companies and organizations like to say that quality is a priority, but few of them really behave that way. There’s a good reason for that. Quality management always requires managing probabilities, specifically the probability of a bad outcome. Companies have to balance the real expense of time or dollars today vs. the theoretical expense of a future possibility of a quality failure. I guarantee that someone in senior leadership is going to argue that COGS or operational expenses or time-to-market or meeting production targets is more important and more real and more immediate than the chance that something might go wrong.

It would be different if the folks who are looking out for quality could state with complete assurance that a disaster will happen if we don’t take these steps. If you knew you were going to have a car accident today, you would be sure to buckle your seat belt, or you might not even leave home. Unfortunately, it’s rarely that obvious. As a result, businesses will operate closer and closer to the edge of disaster, accepting more risk and convincing themselves that the probabilities are low in order to reduce cost.

When the disaster finally does happen, someone in design or production or delivery may have to accept the blame to satisfy customers and stakeholders, but that’s not the real root cause. Business and consumers need to accept that fact that quality failures will continue to happen because bad outcomes are statistically possible, albeit unlikely. Business and consumers also need understand that it’s not economically possible for businesses to prevent all bad outcomes and still remain profitable. Businesses can and should do better, but we can’t and shouldn’t expect perfection.




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