Posts Tagged ‘leader’

Total Quality Management: A Multiple Industry Perspective

August 16, 2009

In the following analysis, this author will compare three organizations from different industries. Motorola, Papa John’s Pizza, and the Illinois Environmental Protection Agency are very different in their company culture, strengths and weaknesses, and brand image. However, each company has adopted aspects of TQM in their focus on improvement. This author will describe each organization’s quality interest in light of customer satisfaction. Further, steps each organization took to affect quality and customer satisfaction will be outlined. As leadership is integral to organizational change, this discussion will include a comparison of the leaders in all three corporations that helped establish value-driven quality. Lastly, a brief chart detailing the differences between each organization in respect to their quality focus is provided.

 Motorola: Focus on Quality and Customer Satisfaction

 As a customer-driven organization, implementing a substantive quality improvement management scheme is an essential ingredient to success. Motorola, a long-term practitioner of the Six Sigma management discipline, presents several business practices that improved its quality, brand value, and customer relationships.

First, as one of the first organizations to wholly adopt a TQM management style, Motorola quickly realized that their long-term brand value was due to their customers. Any organization can create a popular product. Only a disciplined corporation can create products of the utmost quality, ensuring customer loyalty and retention throughout the product lifecycle. Motorola recognized that its product defects did not comply with its newfound customer dedication. In order to serve its customers, Motorola had to engage in enterprise-wide process improvement.

As a result of this quality-driven focus, Motorola derived its Six Sigma management theory.

“To accomplish its quality and total customer satisfaction goals, Motorola concentrates on several key operational initiatives. At the top of the list is “Six Sigma Quality,” a statistical measure of variation from a desired result. In concrete terms, Six Sigma translates into a target of no more than 3.4 defects per million products, customer services included”. (National Institute of Standards and Technology; Aug. 2001. Pg. 1 ¶ 7)

The greatest action taken by Motorola in its dedication to quality was its creation and adoption of the Six Sigma management theory. Motorola’s leadership felt TQM principles did not adequately serve its need for continuous process improvement. As a result, executives explored the areas that they felt were not being served by TQM. They realized that the furthest measurement of quality in the midst of production was better served by the Six Sigma statistical analysis. This challenging theory took the quality focus of TQM to the furthest scientific, quantitative level.

Motorola’s success was and is based on their need to satisfy consumers. Electronics, particularly cell phones, are becoming disposable goods. Cell phone owners in the U.S. constantly purchase the newer, better model. In order to continue earning customer loyalty, and retain their customers purchase every few years in lieu of its competitors, Motorola was required to constantly improve their processes in order to ensure they produced the most quality product possible.

Motorola’s leadership were the change drivers necessary for the organization’s achievement of six sigma. In its beginnings, the six sigma theory at Motorola was wholly organic and driven by the innovation and curiosity of the company’s leaders.

“The process improvement methodology invented by Geary Rummler and friends in the early 1980’s and first deployed at Motorola was quite different from today’s approaches. It started experimentally, on a small scale, and then eventually got applied to whole business units as the methodology matured. But in those early outings, there were no steering committees or design teams. The people we worked with were the executives. It was the leaders of the business who were the process improvers, the process owners, the process team.” (Ramias, A.; Dec. 2006. Pg. 1 ¶ 4)

By strength of persistence, Motorola leadership completely altered the face of business today in their quest for quality. Through the six sigma management theory, Motorola’s legacy to the world has been established.

Papa John’s Pizza: Restaurant Leader in Customer Service and Quality

         Papa John’s Pizza (Papa John’s), a U.S. quick-service restaurant leader, is equally focused on quality in light of their customer dedication.  With over 3000 units, Papa John’s is considered to be the third largest quick-service pizza company in the world, after Pizza Hut and Dominos, respectively. Papa John’s is wholly committed to their customers: for six consecutive years the company ranked #1 among the restaurant industry in a customer satisfaction poll developed by the American Customer Satisfaction index (Papa John’s International; May 2005).

In the restaurant industry, customer satisfaction is integral to the life of an organization.

“Three Washington children died and 600 others were sickened due to poisoning from E. coli 0157:H7 served in undercooked Jack in the Box hamburgers.”(Porterfield, E. & Berliant, A.; Jun. 1995. Pg. 1 ¶ 2).

As a result of the Jack-In-The-Box E.coli incident, many potential franchisees are still wary of opening up a unit in particular regions of the country – they recognize that the food poisoning outbreak is still recalled by fast food consumers in those areas, who refuse to purchase quick service food items from a Jack-In-The-Box store.

The taint that poor quality can exert upon an organization in the restaurant industry becomes clear when the Jack-In-The-Box scenario is recalled. Customers are deeply affected by poor quality in terms of food. According to Maslov’s hierarchy of needs, being safe and fed are among society’s basic, primal desires. Although killer food is an extreme example, it is still easy to recognize why people are so deeply bothered when a restaurant does not deliver a quality product. When food is toxic it permits consumers to question their ability to make safe choices among food products, thus infringing upon their basic need for survival. From a psychological standpoint, the public has every right to become inflamed, afraid, and angry when they discover food choices aren’t guaranteed to provide us with basic sustenance, and due to quality concerns, may in fact injure them.

Papa John’s focused on technological improvement in their search for quality. In order to become constantly apprised of changes within the organization, Papa John’s leadership invested in an enterprise business-intelligence system. While considered a huge expenditure, this technology enabled executives to receive information at a lightning pace, allowing them to monitor, evaluate, and recommend changes to day-to-day operations: a key operation part of TQM process improvement.  Papa John’s new business intelligence software equipped executives with information, a key part of conducting business at the pace the 21st century demands. However, the enterprise system also affected operations from the viewpoint of consumers:

“…generated tangible business results, such as a 10% reduction in ‘out the door’ time, and a significant improvement in order completeness”(Analysis Team; n.d. Pg. 1 ¶ 2).

Papa John’s also worked to achieve quality in terms of their labor force. The organization, like many others, realized that the consistent training and development of the workforce is essential to organizational success. In order to ensure this quality, Papa John’s invested in a leader for this training and development movement, titled the “Vice President of Training and Development”.

In many corporations employee training and development is a “softer” focus, with very little tangible changes made to the workforce. However, in the case of Papa John’s, training and development became formalized and left a lasting imprint on the organization. A developed training program identified employees for promotion. A well-respected leadership program was adopted. The organization also benefited from a simple change in structure. The training department moved from a centralized location to a decentralized location, in order to better serve Papa John’s global employee force (Snow & Associates; 2006. Pg. 1 ¶ 14).

         It is essential to note the role Papa John’s leadership took in the implementation of TQM. From the beginning, CEO and founder John Schnatter believed quality tied to a customer focus was the essential ingredient of a successful organization’s management scheme.  However, during the late 1990s, Schnatter began to realize Papa John’s growing pains. Through the implementation of a new measurement technique, CEO Schnatter realized the organization was not sustaining quality. 

“Papa John’s was shocked by its shortcomings. On a scale of 1 to 10, its pizzas averaged 5.1, customers waited on hold for an average 2.5 minutes and 24 percent of its pizzas took longer than an hour to be delivered. A nightmare was developing right before Schnatter’s eyes.”(Coomes, S.; Dec. 2006. Pg. 1 ¶ 4)

            Papa John’s founder John Schnatter was determined to repair the problems rampant in the organization. Despite his reluctance to re-assume the role of CEO, he realized that part of the problems lie in his leadership. The CEO at that time resigned, and Schnatter was placed in the CEO position again. Upon doing so, Schnatter urged Papa John’s franchisees to expend more financially in order to achieve quality; focusing on more adequate staffing and consistent food costs. In order to encourage this expenditure, Schnatter gave up one-third of his yearly salary – $200,000 – in order to pay incentive bonuses to high-ranking franchisees (Coomes, S.; Dec. 2006).

            While Papa John’s Pizza faces many challenges today, including a more health-conscious consumer base and declining consumer spending, the corporation continues to succeed due to its strong quality emphasis. Organizational leadership is determined to maintain its high-quality standards in order to serve its customers a consistently superior product.

Illinois Environmental Protection Agency: Pursuing Quality

While introducing TQM to a government bureaucracy can seem an impossible task, the Illinois Environmental Protection Agency (IEPA) was blessed in its acquisition of new talent. In 1992, Director Mary E. Hade introduced TQM to the state agency after learning about the management philosophy during her tenure with the U.S. Environmental Protection Agency.

Hade arrived at the IEPA and quickly assessed its current quality condition. While the agency was well-known for its strong pursuit of environmental regulation, it had also developed a reputation as a cantankerous, difficult group to deal with. Hade’s opinion:

“…the agency had built up 20 years of adversarial relationships with its customers and had a reputation for operating in a ‘highhanded’ way, as if ‘we came in and said do it our way, and if you don’t do it, we’ll nail you to the wall.’ She said that ‘one guy told us they used to have to draw straws in their office about who would call the agency’ because it was rarely a pleasant experience.”(Wojcicki, E.; Oct. 1993. Pg.5 ¶ 4)

The IEPA needed organizational change quickly if it wanted to improve its reputation with external customers. As with any organization, the IEPA relies upon a positive relationship with its internal customers in order to continue both receiving work and questions, to maintain its reputation as a thought-leader and a benchmark of best practices.  First, Hade and the other key leaders of the agency took part in an extensive TQM training program. Upon learning basic TQM principles, these leaders began implementing quality-oriented techniques in all of the business operations. Later, the remainder of the IEPA staff was given training in TQM so they were able to monitor and evaluate their own job processes.

One example of the effect TQM had upon the IEPA is the changes that took place in the organization’s FOIA department. In one case, an angry external customer complained that he was told by the agency that it needed 18 months to comply with his FOIA request. After the TQM training, the IEPA’s FOIA coordinator reported that the agency now responds to FOIA requests in only 5% of that time; a reasonable two to four week period. The IEPA attributes these changes to hard work and the quality training education received by agency employees (Wojcicki, E.; Oct. 1993).

Another business process affected by TQM was the IEPA’s archive system for tracking hazardous waste. A Bureau of Land employee brought the system to the attention of Director Hade, as he felt that their hard copy records were burdensome and did not keep IEPA employees aware of these places of interest in the state. Hade quickly initiated a TQM project to overhaul the IEPA’s outdated system. As a result, agency employees are now able to quickly retrieve this information, and are no longer burdened with the task of filling out new forms for a document archive (Wojcicki, E.; Oct. 1993).

Clearly IEPA leadership greatly contributed to the agency’s assuming TQM traits. Director Hade, impressed by the use of TQM at her former employer, the U.S. EPA, determined that the IEPA was in need of a focus on quality to improve its working conditions, business processes, and reputation. As a result of her direction, the IEPA operates more efficiently and has a positive, “customer first” focus.

TQM was originally the favored management theory by manufacturing companies that relied upon business process changes to eliminate defective product creation. However, as the theory gained strength among the business community, other sectors outside of manufacturing began to recognize its power. A customer, quality-oriented organization is focused upon the group that will continue to make an organization successful – its customers or consumers – and will continue to succeed due to a reputation for quality services or products. Motorola, Papa John’s Pizza, and the Illinois Environmental Protection Agency continue to embrace quality tools in order to maintain their reputation as industry leaders.

Resources

Analysis Team (n.d.). “Get It While It’s Hot”. Retrieved online October 27, 2007 from the EBSCO database, part of the University of Phoenix student library.

Coomes, S. (Dec. 2006). “Chain of 2006: Papa John’s Pizza”. Retrieved online October 27, 2007, from http://www.pizzamarketplace.com/article.php?id=6376&prc=128&page=109

National Institute of Standards and Technology (Aug. 2001). “Malcolm Baldrige National Quality Award 1988 Winner: Motorola, Inc.”. Retrieved online October 27, 2007 from http://209.85.165.104/search?q=cache:RRM6j9EDxPcJ:www.quality.nist.gov/Motorola_88.htm+Motorola+quality+improvement&hl=en&ct=clnk&cd=1&gl=us.

Papa John’s International (May 2005). “Papa John’s Ranks #1 in American Customer Satisfaction for Record Sixth Straight Year; “Better Ingredients. Better Pizza” Proposition Pays off with Consumers”. Retrieved online October 27, 2007 from http://ir.papajohns.com/phoenix.zhtml?c=115556&p=irol-newsArticle&ID=710676&highlight=.

Porterfield, E. & Berliant, A. (Jun. 1995). “Jack In The Box Ignored Safety Rules”. The News Tribune (Tacoma, WA). Retrieved online October 28, 2007 from http://www.about-ecoli.com/news/jack-in-the-box3.htm.

 Ramias, A. (Dec. 2006). “Where Have All the Leaders Gone? The Long-Lost Executive Process Improvement Project”. Retrieved online October 27, 2007 from http://performancedesignlab.com/Files/ArticleFiles/8/Document1/Where%20Have%20All%20The%20Leaders%20Gone.pdf

 Snow & Associates, Inc. (2006). “Our Associates”. Retrieved online October 27, 2007 from http://209.85.165.104/search?q=cache:CPWKtgtScMAJ:snowassociates.com/ourAssociates.asp+Papa+John%27s+quality+focus+TQM&hl=en&ct=clnk&cd=1&gl=us.

 Wojcicki, E. (Oct. 1993). “Putting Quality First In Managing Government”. Retrieved online October 27, 2007 from http://www.lib.niu.edu/ipo/1993/ii931019.html

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