Integrating Quality into Strategic Management

Strategic quality management is the process of establishing long range customer focused goals and defining the approach to meeting those goals. It is performed at the top organizational level. The eight elements of strategic management are:

  • Define mission and critical success factors

  • Study internal and external environments and identify strengths, weaknesses, opportunities and threats to the organization.

  • Define a long term goal (vision)

  • Develop key strategies to achieve that vision.

  • Develop strategic goals.

  • Subdivide the goals and develop operational plans and projects to achieve the goals.

  • Provide executive leadership to implement the strategies.

  • Review progress with measurements, assessments and audits.

Quality must be integrated into the eight elements of strategic management mentioned above. This is made possible by setting up organizational machinery to carry out improvements, train all levels to execute their quality responsibilities, establish measures and review progress against improvement goals and provide recognition for superior performance. Emphasis must be on actions by line departments instead of relying on the quality department. To integrate quality into strategic management leadership by upper management is essential.

Mission and Vision

A mission is a statement of the organization'’s purpose and its scope of operations. An example of a mission statement:

“We exist to create, make and market useful products and services to satisfy the needs of our customers throughout the world”. (Texas Instruments)

All mission statements must recognize quality. A mission statement denotes what an organization is doing today.

A vision statement defines the desired future state of the organization. A vision is seen as the goal that may take five or more to achieve. An example:

“To be the leading supplier of PCs and PC servers in all customer segments.” (Compaq Computers)

A vision statement also recognizes quality like a mission statement. In short a mission statement focuses on “what our business is now” and a vision statement brings out “what our business will be in the future”.

Development of Goals

A goal is a desired result that is to be achieved within a specified time. The overall organizational goal is known as vision. Long range goals over a period of five years are known as strategic goals while short range goals to be achieved within a year are tactical goals.

An example of corporate quality goal is as follows:

“Reduce by 50% the time required to resolve customer complaints”.

A goal statement includes quantification in terms of product characteristics or a date (the end of the calendar year). Quality goals are identified from several inputs of which four important sources are cost of poor quality, market standing on quality, quality culture and the quality system. These sources help perform an analysis of strengths, weaknesses, opportunities and threats. Companies aspiring for excellence often set goals beyond the normal attainable levels to motivate employees to generate unusual methods to achieve excellence. These are known as stretch goals and can sometimes yield extraordinary results.

Competitive benchmarking is the continuous evaluation of products, services and practices against the company'’s toughest competitors or those organizations renowned as industry leaders. It serves as an essential input to the formulation of goals. Benchmarking also provides ideas for improvement along with evidence that best practices not only exist but also must be adopted by the company to be competitive.

Obstacles to Achieving Quality

There are many reasons why an organization fails to attain its quality goals but six are of extreme importance:

  1. Lack of leadership by top management: People in the upper management may be committed to the quality goals of the organization but lack of visible leadership and evidence of this commitment has a damaging effect on the rest of the organization.

  2. Reliance on specific techniques as the primary means of achieving quality goals: Techniques such as statistical process control, quality circles, quality function deployment etc. address only a specific part of the problem.

  3. Underestimating the time and resources required: Typically 10% of the time of the upper and middle management and professional specialists is required to achieve breakthroughs in quality. This time must be found without adding extra personnel. A change of priorities by delaying or eliminating other activities is needed.

  4. Lack of infrastructure for quality: For major activities the management delegates responsibilities after setting up mechanisms that include goals, responsibilities, plans and a structure for carrying out the task on hand. Such elements are very vague or missing with respect to quality.

  5. Failure to understand the skepticism for a “new quality program”: Employees have seen previous quality programs go down the drain. The management needs to present convincingly (1) a proof of the need for the quality effort and (2) demonstrate determination to make the new program a success.

  6. Failure to start “small” and learn from pilot activities: In a haste to achieve big results rapidly massive training takes place with the hope that simultaneous advances can be made on all fronts. The common mistake made in quality projects is the tendency to bite more than one can chew. People grow tired of projects that seem to take forever. The ideal way to go is to start off with small pilot projects that will be completed within six months.

An organization embarking on a quality project would do well to learn about the reasons for failure of other organizations.