Intellect | Blog | How QMS Improves Organizational Performance

Intellect | Blog | How QMS Improves Organizational Performance

Author Paul Dionne

5 min read

Intellect | Blog | How QMS Improves Organizational Performance

By Paul Dionne on Mon, Dec 21, 2020 @ 11:22 AM

Topics: QMS Software

At the heart of every business lies the question “How could we do things better than they have been done in the past?” This is the very essence of innovation, – not to achieve perfection, but to be in constant search of better, faster, cheaper, or more efficient ways to get things done. The pony express replaced slow, inefficient mail service (albeit at a very high cost). Shortly thereafter, the telegraph replaced the pony express, providing a faster and cheaper means of communication than ever before. The telegraph, in turn, was eventually supplanted by the telephone… and from there, innovation continued its onward march.
There is a close relationship between cultures of quality and cultures that foster innovation. Both have their roots in an inexorable drive toward improvement. In both cases, there is an impetus to ask the question “How could we do things better?” as well as a pragmatic, down-to-earth approach toward translating the resulting vision into reality.
Vision without action, after all, is just a dream. That is the fate of organizations that have lots of great ideas, but which lack the ability to execute. Action without vision, on the other hand, ultimately leads to stagnation. Innovation fails to ever materialize, and they fall behind their competitors. As Will Rogers once said, “Even if you’re on the right track, you’ll get run over if you just sit there.”
In this respect, innovation and quality can be seen as two sides of the same coin. Innovation sets the direction, and quality management provides you with the means to get there safely. When both are working in harmony, you have a high-performing organization. It’s not a guarantee of success, but it certainly increases your odds dramatically.

Quality Management Maturity Says a Lot About an Organization
In a recent post, we wrote about Philip Crosby’s Quality Management Maturity Grid (QMMG). If you haven’t seen it before, it’s worth spending a few minutes to look over it and asking yourself: “Where does my organization fit with respect to each of these six attributes?” How does your organization deal with quality problems? What is your cost of quality as a percentage of sales? What does your organizational structure look like, and where does quality management fit within it?
For each attribute, you’ll notice that your organization sits somewhere along a continuum. Among high performers, the cost of quality will be around 2.5% of sales. At the other end of the spectrum, the actual number may be unknown, but if measured, would probably be somewhere around 20% of sales. Among high performers, quality management merits a position on the Board of Directors. In low-maturity companies, either there is no quality department, or is a functional subset of manufacturing or engineering. In top organizations quality is a proactive undertaking. Low performers, in contrast, tend to be very reactive.
It’s worth considering, therefore, how organizational performance may be improved, broadly speaking, by the implementation of effective quality management programs. After all, quality does not exist in a vacuum; it fits within a broader organizational ethos that encompasses accountability, efficiency, and innovation. By forging ahead with meaningful improvements to your QMS, you can drive other meaningful changes that impact your organization in a host of different ways.
Let’s look at some of the ways in which a strong quality orientation can drive high performance throughout an organization.

Helping Innovations to Become Reality
Many organizations, – particularly small startups in cutting edge industries like technology and healthcare, – perform extraordinarily well in terms of innovative thinking, but can sometimes get ahead of themselves when it comes to turning great ideas into reality. Very often, such companies are founded by a visionary CEO, – someone with a great idea and the technical know-how to implement it.
That entrepreneurial spirit often requires a countervailing voice, – someone with a managerial mindset to put some guardrails around that innovative enthusiasm by establishing processes, controlling costs, and setting realistic timelines. Entrepreneurship expert Gino Wickman describes this person as the “implementer”, – someone who serves as the perfect complement to the visionary founder and CEO.
QMS provides precisely that kind of structured approach with respect to virtually any operational process within the company. In many respects, quality management functions as a kind of framework for different stakeholders throughout the organization to agree on intended results and the steps that will be required to get there. QMS provides the tools to make the vision a reality.

Putting an End to the Blame Game
Finger-pointing is (unfortunately) an all-too-common attribute of so many companies that fall short on organizational maturity and discipline. Companies with a strong culture of quality, in contrast, tend to focus on solutions rather than assigning blame. Root cause analysis (RCA) seeks to discover why problems are happening. Corrective Action Preventive Action (CAPA) aims to address those problems in order to ensure they don’t continue to happen in the future.
In this respect, established QMS practices are solution-oriented. They shift the focus away from “who is to blame” and direct it instead to “how can we do better as an organization?” It’s worth noting that in Crosby’s QMMG, low-performing organizations are characterized by “lots of yelling and accusations”. Crosby also notes that in such companies, there is a tendency to blame quality inspectors for any existing quality problems. As an organization moves up to a higher level of maturity, “all functions are open to suggestions and improvement.”
For that reason alone, it’s worth considering how your organization might benefit from a good QMS overhaul. That kind of shift in thinking can be transformative.

Strategic Objectives: Profitability and Growth
Finally, we get to the topics that executive management is usually most concerned with, – profitability and growth. In low maturity companies, quality is often viewed as a cost center, – that is, as a drain on profitability. Quality champions, in contrast, understand that quality is integral to everything they do. Companies like 3M, HP, and Toyota achieved market-leading positions and outstanding profitability based largely on the effectiveness of their QMS initiatives.
Any executive who believes that quality is a net cost should be presented with one simple question: “What is the cost of poor quality?” In other words, how costly is the alternative?
Even for startup companies whose primary concern is market penetration and growth, QMS is essential because of its pivotal role in customer satisfaction and corporate reputation. For many early-stage companies, QMS may play an even more important role insofar as it provides for the realistic implementation of the company’s aspirations with respect to its products and services.
A small group of committed individuals within a company has the power to affect a broader organizational transformation, even if their efforts are confined to the arena of quality management. QMS has the power to do that, largely because it is so effective at mapping out processes and providing a framework for ensuring that they are followed. Continuous improvement concerns itself with identifying ways to do things that are better, faster, cheaper, and more efficient. That benefits everyone in the company. Very often, it is the beginning of a cultural transformation.

If your organization is seeking to achieve higher levels of performance in quality management and across every other domain, we would love to speak with you. Contact us today to learn more about how Intellect can help you become a high performer.

What’s next?

Now that you’ve learned about how to utilize QMS to drive substantial change improves organizational performance, learn about “how to improve your employee’s performance through quality culture“.

Paul Dionne

Written by Paul Dionne