Quality Leadership – Role Model for Recovery

To the CEO, quality is not so much about numbers, statistics, or inspections.  It is more about attitude, beliefs, values, and lifestyles.

While CEOs are champions of quality, they are not engineers, technicians, or statisticians.  They are concerned with the heart as much as the head and hands.  They hope to achieve congruence among the motive, the mind-set, and the method of quality. Of course, they also want the results: improved quality in products and services, as well as, gains in productivity and profitability.  Obviously, that is not what they always get, but they remain committed to the ideal of quality as much as to any program or personality.

Xerox Corporation is an example of what happened to much of American industry in the 1980s.  Now it serves as a global role model for recovery.  When Xerox introduced the first plain paper copier, Xerox 914, in 1959, it created a new industry and launched the company into an era of feverish growth and success.  But after two decades of success, it became complacent and did not focus on the customer and the competition.  The Japanese came at the low end of the market, but Xerox didn’t take the threat seriously.  Upper managers believed they would always be successful, even as market share began to shrink.  Xerox believed this was their industry; they had created it; they had built it; they owned it.

By the late 1970s, the Japanese had almost put Xerox out of business.  Their market share was cut in half and returns on asset slipped to eight per cent.  Customer satisfaction was eroded.  The alarm triggered when Xerox realized that the Japanese were selling their machines for what it cost Xerox to make the same.  Paul A Allaire, the President and CEO of Xerox Corporation at that time, realized that along with lower cost, the Japanese produced better quality.  They were profitable, in spite of higher distribution costs.

Allaire also realized that to be a world-class competitor, Xerox had to challenge everything they had done in the past.  Quality became their basic business principle.  Quality meant providing their external and internal customers with innovative products and services that fully satisfied their requirements.  Xerox has been at the process of changing the corporation and improving quality for about 15 years now.  Although their work was recognized by the Malcolm Baldrige National Quality Award, five years along the journey.

Allaire now recommends four specifics to organizations wishing to transform to world-class.  First, senior management should be committed to change.  Without genuine hands-on commitment, all quality improvement and employee improvement are doomed to fail.  And that commitment must take the form of action, not rhetoric.

Second, the commitment of union leadership must be every bit as strong as that of the management.  High level of trust must be built between labour and management.  The union must understand that the company must be competitive and that the workers can provide significant help in that struggle.  This help can take the form of quality circles, self directed teams and suggestions.

Third, it takes some initial investments.  For example, every person in the organization must be given six full days of training in problem solving, quality improvement tools and team building.  This can be a substantial investment in terms of financial, and human resources.  It is one of the better investments that can be made.

Fourth, it requires patience and discipline.  Experience demonstrates that results do not come as quickly as one would like.  There are some false starts.  There are parts of the organization that lag behind others.  There are managers, particularly middle managers, who see employee involvement as a threat.

One Japanese expert on quality and employee involvement likens the need for patience and discipline to that of the bamboo farmer.  Once the bamboo seed is planted, the farmer must water it every day for four years before the tree breaks ground.  But when it finally does, it grows 60 feet in 90 days.