New Truths
Presently, quality is no longer an optional concern for corporate India. Based on international historical comparisons, it is evident that Indian businesses that do not produce high-quality products and services will not survive the 1990s. Quality must form an integral part of a company’s business strategy.
While it may seem implausible, a little more than five years ago consciousness of the importance of quality and customer satisfaction was relatively low in India. At that time, we subscribed to certain "truths" about quality, such as, better quality costs more, quality requires extra time to produce, and quality programmes best fit manufacturing. Competition if any, was selective.
Today, the leaders in our client companies participating in the Total Quality movement, have dispelled the old myths. New truths have emerged. We now know that raising quality does not raise costs, it lowers them; that quality does not take time, it saves it; and that service organizations need quality most urgently. Competition is a reality.
Personal Responsibility
Over the past three years we have witnessed economic reforms that are pushing India into the mainstream of global commerce. The recurring question in our society is "How do we become more competitive?" A good surrogate question is "What are you doing about quality?" The fundamental answer is that we must become competitive, one person at a time, top down.
Quality is a personal responsibility. Quality is achieved through personal excellence, with an expectation of perfection. Human beings can operate to that standard, and they thrill at operating to that standard. And the aggregation of all of us working on quality ultimately holds the potential to substantially affect our country’s future. Made in India must become a world class marketing asset, in strategic industries.
Firms, not nations, compete in international markets. Firms must choose a position within an industry. At the heart of positioning is competitive advantage. In the long run, firms succeed relative to their competitors if they possess substantial competitive advantage: lower cost and differentiation.
Lower Cost
Lower cost is the ability of a firm to design, produce, and market a comparable product more efficiently than its competitors. If prices are similar to those of competitors, lower cost translates into better returns.
Korean steel and semiconductor producers have attracted world markets using this strategy. They produce comparable products at very low cost, employing low-wage but highly productive labour forces and modern technology. At the heart is productivity, stemming from continuous quality improvement of processes: manufacturing, service and business. Improvement, that demands company-wide participation.
Differentiation
Differentiation is the ability to provide unique and superior value to the buyer in terms of product quality, special features or after-sales service. German machine tool producers, for example, compete with differentiation strategies involving high product performance, reliability and responsive service.
Differentiation allows a firm to command a premium price, which leads to superior profitability, provided costs are comparable to those of competitors. At the heart is customer delight, stemming from institutionalizing a structured quality planning process. A process managed by quality professionals, not amateurs.
Expect and Present Perfection
Competitive advantage of either type translates into higher productivity than that of competitors. The low cost firm produces a given output using fewer inputs than competitors require. The differentiated firm achieves higher revenues per unit than competitors. Thus, competitive advantage is directly linked to the underpinning of national income. Any successful strategy, must pay close attention to both types of advantage while maintaining a clear commitment to superiority on one.
Every institution in India - service, manufacturing and public - should embrace the Total Quality movement. Our destiny is in our hands. We have the privilege of expecting perfection and when we present perfection to our customers we will do more business, increase the wealth of this nation, and improve the choices and freedom of our republic.
CREDITS: Suresh Lulla, Founder & Mentor, Qimpro Consultants Pvt. Ltd.