Organizations are evolving the quality from merely being a ‘checking the compliance boxes’ to really using quality practices to impact and empower staff to make improvements, there is opportunity for a greater ROI or return on investment and improved customer satisfaction. Organizations which use quality as their main competitive advantage, operational excellence, or as a continuous improvement activity are much more likely to embrace the customer-centric, quality culture.
China is the good example of this practice. China realizes that it cannot rely on its cheap or low price anymore, as its labor cost is getting higher and higher, and on the other hand, other countries like Bangladesh, Vietnam or Indonesia have lower labor cost than China. Just like the economist says, if you rely on setting your price low, there will be other brands that will offer lower price than yours! And it will make your business unstable. How to solve that? You have to improve the quality. One obvious example of China striving to build its quality awareness is currently, they just acquired the Swedish car maker, Volvo. Yes, it’s very true that China is trying to build the brand awareness which leads to the better quality, rather than just rely on its quantity and low cost.
The Volvo’s Plants in China
Strategic plan is a very essential thing throughout the organization. To maximize the impact of quality in the overall performance, organization has to have a clear goals that are established across the organization—corporate, management and support services, and operational businesses and functional units.
Every organization needs the transparency on its quality measures, because this helps to create buy-in on quality management and enables employees to understand what role quality plays in how they do work, how they can impact quality, and its effects on their customers’ satisfaction. Transparency generates accountability at the very basic level and it also drives a healthy competition between business units. It also will increase the knowledge-sharing opportunities, as managers with lower performance often reach out to managers in groups with higher performance, even across diverse products and services within the same organization.
The main uses of quality measures is to set goals that will initiate higher performance throughout the organization; for predictive analysis to identify what potential opportunities or issues in their operations and business process, and as part of their variable-performance compensations. Just like the marketing says, it’s all about the customer! And, yes, organizations that include quality measures to drive higher performance or for operational improvement are more likely to agree with the customer-centric, quality cultural statements. From this analysis, we can conclude that the organization has embraced the quality culture and it’s simply now how they do business.
Adapted from Industry Week