Quality is alive and well in Central New York

Revered as religion by some, disdained as dogma by others, total quality management (TQM) has nevertheless passed the point of being considered merely a fad. Central New York abounds in examples of its use and success. Wegmans, Wal-Mart, Carrier, and Syracuse University are just four prominent examples. The range of companies using TQM in CNY spans almost every imaginable industry.

The Central New York Community Quality Council (CNYCQC) held its event of the year recently. Called "Driving Quality Through Central New York," it consisted primarily of a tour of Syracuse-area businesses that successfully practice TQM. In addition to Wegmans, Wal-Mart, and Carrier, participants in the event toured the Higbee Gaskets plant, the SUNY Health Science Center, and the National Training Center of New Venture Gear/Chrysler. The diversity in the types of businesses visited was matched by the diversity of the participants' companies. These included Empire Federal Credit Union; Associated Builders & Contractors, and Agway. There was a sizable representation of participants from health-care organizations. including University Hospital, Oswego Hospital, and Hematology Oncology Associates.

Why the rush to embrace TQM? After all, roughly two-thirds of the businesses that adopt it end up failing or dropping the effort. A Wall Street Journal headline once proclaimed, "Quality Programs Show Shoddy Results." As many stories as there are about how TQM turned a company around, there are still plenty of instances in which TQM did not lead to business success. For example, an AT&T plant that won the prestigious Malcolm Baldrige National Quality Award in 1992 announced a major layoff the following year. More tellingly, another Baldrige award winner--the Wallace Company--filed for bankruptcy in 1992.

All the same, TQM retains its allure because of its noteworthy successes, and because of the perception that a company cannot ignore TQM and remain competitive. Besides that, who in his right mind would argue against the systematic pursuit of product quality?

Manufacturing

TQM successes first became apparent in manufacturing industries, especially in the automobile industry. In fact. the adoption of TQM in the U.S. is directly related to the trouncing of the U.S. automobile industry by Japanese manufacturers such as Honda and Toyota, which have long used practices similar at their core to TQM. U.S. auto makers faced the choice of adopting managerial practices similar to the Japanese or being chased out of the marketplace, as Chrysler nearly was. Not by accident did Ford declare, "Quality is Job #1," beginning a comeback that resulted in the Escort and the Taurus becoming the world's best-selling automobiles.

With TQM's emphasis on quantitative analysis of production and management, manufacturing remains the field in which TQM has made the most consistent gains. Conformity to specifications, defect levels, cost of manufacture, and man-hours spent are most easily measurable for tangible products. In addition, TQM has become woven into the fabric of manufacturing relationships. As component-buying companies have adopted MM, they have pulled along suppliers that wish to retain their business. In particular, many components buyers today, especially those that practice TQM, won't purchase components that do not have ISO 9000 certification. A product that has ISO 9000 certification comes with the assurance that it meets a set of stringent quality standards. This eliminates the need for buyers to conduct in-house quality checks on these components. Usually, a components manufacturer, in order to be able to meet ISO 9000 documentation requirements, will need to implement some aspect of TQM.

Another facet of TQM's success in manufacturing industries is revealed by a visit to the National Training Center, operated by New Venture Gear/Chrysler. Located in Syracuse, it is one of nine such centers nationwide. It is a remarkable example of union-management cooperation. Both sides take TQM's educational component very seriously, recognizing that a quality organization requires trained employees. The facility is open 24 hours a day, and offers training not only for New Venture Gear/Chrysler employees, but also for their families. Union members' children can get tutoring four nights a week. High-school-level classes are offered, as well as university-level classes through satellite hookup with the other NTC sites. According to Tony DeFrancisco, administrator at the center, 2,000 people get training there every month. The center is part of a consortium that allows employees from Crouse-Hinds, Empire Vision, and New York State to get training there. Entirely funded by workers' contributions from regular and overtime pay, the center runs a wellness facility, community and political action programs, and voter-registration drives. With equal parts bravado and jingoism, DeFrancisco declares, "Iacocca didn't save Chrysler. We, the employees, saved Chrysler! And what we're doing here is making sure that America will never fall behind again in automobile manufacturing."

Service businesses, too

TQM's successes are by no means limited to manufacturing. The emphasis on customer satisfaction makes it well-suited for service-related and marketing enterprises. In retailing, TQM's effects are obvious to any customer of Empire Vision Center, Wegmans, and Wal-Mart. That the customer comes first is communicated actively, with signs, as well as passively, with friendly service. In terms of product, Wegmans has redefined expectations of a supermarket in Central New York. It has done this both through its internal organization into self-managing teams, and by its awareness of what its customers want. The self-managing teams allow for "category ownership" in the various department. This makes possible the introduction of 18 different kinds of peppers, for example, or the introduction of new (to this area) varieties of mushrooms. Wegmans' knowledge that its clientele is ethnically diverse, often well-traveled, and financially well-off, led the supermarket to offer health-conscious and international foods (including sushi). Some recipes for dishes served at Wegmans Market Cafe are created by chefs trained at the Culinary Institute of America. Wegmans seems to be aiming beyond customer satisfaction, to customer delight.

TQM in health care

Health care, too, is embracing TQM. 1997 will likely mark the transition to a primarily competitive health-care environment, compared to the regulatory environment that has so far persisted. Management of health-care businesses, in order to control cost and improve quality, is now of critical importance, as is the need to satisfy customers. Additionally, some HMOs now use a standard application form for physicians--it's conceivable that something analogous to ISO 9000 certification could result from the widespread use of standardized forms. Physician offices, hospitals, HMOs--even pharmacies--might feel compelled to implement some aspect of TQM.

With the roughly two-thirds failure rate of TQM, there clearly are pitfalls to address before beginning to implement it. Chief among these is the tendency to see TQM as a program, rather than as a change in corporate culture. This problem is sometimes exacerbated by management's own unwillingness to undergo fundamental change. In many instances, the amount of change is far too much to digest in any preset period of time. So the first challenge to overcome in implementing the concept is to figure out how to integrate TQM into an overall business strategy, rather than treating it as a set of extra-operational rules.

The amount of change involved in a transition to TQM is so great that this .sometimes spreads an organization's resources too thin. Millions of dollars are spent and all manner of implementation teams set up, often with disappointing results. This is responsible for a good deal of employee frustration with TQM, experts say. Some management consultants suggest focusing instead on specific improvement targets that can yield significant benefits to the company. Such an approach, consultants say, could demonstrate the value of TQM and build support for it within the organization. And, too, an organization does not have to have a formal TQM program in order to do business according to TQM principles. Federal Express, for example, won the Baldrige quality award without ever having a formal TQM program.

Copyright Central New York Business Journal Nov 25, 1996
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