Management by Quality

Excerpted from Kume, Hitoshi,"Management by Quality", Productivity Press (India) Private Limited, Madras, 1996, pp.23-24.

Quality first

The raison d'etre of business management in a free-market economy is of course to make a profit: but, to secure stable profits over a long period, it is important not to be too concerned with short-term gains. Instead, management must strive to acquire a loyal customer base.

The quality-first approach is used to reach this goal by putting before everything else the provision of goods and services of a quality that satisfies a customer. Companies try to make cost reductions, because they directly affect corporate profits, but this approach often places company interests above those of customers. Cost reduction is of course indispensable for survival when price competition is stiff, but a cost reduction program that ignores customers may increase profits temporarily but eventually results in lost market share. It is not a long term option. The quality-first approach means putting quality first and only trying to reduce costs once the necessary quality has been assured.

The next process is the customer

When large numbers of people are working together, it is not enough simply for each individual to perform an allotted task. For example, the design department must not only design products that meet the specifications but must also carefully consider design issues from the production department's standpoint and try to design products that are easy to make. Actively incorporating the production department's views on productivity into the designs helps to link the design and production functions smoothly and further stimulates improvement activities in the production department.

The materials department, which purchases raw materials, and the service department, which performs after-sales service, are also design department's customers. Design should be performed in full consideration of subsequent processes(e.g., by specifying easily-purchased raw materials and standard parts and by designing easily-maintained and repaired mechanisms).

In the production department as well, inadequate work in an upstream process leads to extra rework and adjustment in downstream processes. To avoid this kind of loss, an organization must work with the attitude that its customers are not only the end users of the products or services but everybody affected by the results of its work. In carrying out work, an organization must not think only of its own convenience but must be highly receptive to feedback from subsequent processes and constantly ask what it can do to satisfy them.