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Implementing and Validating The Quality System

This document discusses key aspects of implementing and validating a quality system. It covers: - The building blocks of a quality system including people, organizational learning/knowledge, culture, closeness to customers, and information/finance. - Internal validation methods like self-assessment which involves surveying strengths/weaknesses, categorizing them, and evaluating competitive advantage. - Quality audits which study ways to improve customer service and ensure processes are followed. Audits involve planning, verification, evaluation, and recommendations. - Different types of audits like supplier, certification, award, consultant, and presidential audits. The document provides an overview of the critical components that make up an effective quality system and

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151 views

Implementing and Validating The Quality System

This document discusses key aspects of implementing and validating a quality system. It covers: - The building blocks of a quality system including people, organizational learning/knowledge, culture, closeness to customers, and information/finance. - Internal validation methods like self-assessment which involves surveying strengths/weaknesses, categorizing them, and evaluating competitive advantage. - Quality audits which study ways to improve customer service and ensure processes are followed. Audits involve planning, verification, evaluation, and recommendations. - Different types of audits like supplier, certification, award, consultant, and presidential audits. The document provides an overview of the critical components that make up an effective quality system and

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11.

IMPLEMENTING AND VALIDATING THE QUALITY SYSTEM


Assoc. prof. Natasha Kraleva, Ph.D.
“Basic principle of total quality control is that
customer satisfaction can not be achieved by
concentrating upon any one area alone –
design engineering, inspection, quality
equipment…” – Feigenbaum
Quality improvement is not a stand-alone discipline

Quality system depends on the interactions of different variables

Quality improvement requires interactions on a contingency basis of different


disciplines to create products/services, processes, and systems that effectively
serve customers

World-class companies achieve that status (world class) by understanding their


customers, products, employees, competitors, market …
BUILDING BLOCKS FOR THE SYSTEM OF QUALITY IMPROVEMENT

Organizational
People learning and Culture
knowledge

Closeness to Information
customers and finance
PEOPLE
 People provide intellect, empathy and ability required to provide
outstanding customer service
 Hence, the organization should develop, train, care for and motivate the
employees
 They should feel important and necessary for the growth of the company
 They should understand they are integral to the quality system

 Another people-related issue involves corporate restructuring and


reengineering
 Often they result in mass lay offs
 Lay offs should occur as a last resort (usually are response to economic
realities like downturns of sales)
PEOPLE
 Quality improvement efforts are associated with improved morale and
confidence among employees
 The company is becoming more competitive and the employees’ security is
improving (keeping the job)

 Q: Does job insecurity result in better job performance?


 Q: Higher wages VS job security?
ORGANIZATIONAL LEARNING AND KNOWLEDGE
 Knowledge is necessary for outstanding quality results
 Outstanding quality results emerge from outstanding knowledge

 Lifelong learning is key attribute for employees

 EX: Introducing computers required new skills

 Org. learning is sum of the learning of individual employees

 Outstanding customer service results from providing employees with


outstanding training and knowledge
 It is important for a company that wants to stay competitive to do:
 learning needs assessment,
 training design and
 delivery of the training
CULTURE

 Norms and beliefs that give guidance in decision-making


 Some companies have cultures conducive to quality improvement and in some,
quality improvement is difficult
 Culture includes attitudes toward change, presence/absence of fear, degree of
openness, behavior at all levels …
 EX: When there is distrust, control systems are put into place which results in loss
of time and flexibility
 EX: Companies that respond quickly have cultures where information is available
to everyone and risks are rewarded
CLOSENESS TO CUSTOMERS
 Describes the company’s understanding of the customers, their needs and wants
 Companies that value knowledge will gather data about customers and will study
and understand customers’ changing needs
 Companies that are close to their customers, can more easily retain them
 Customer retention is closely related to profitability
 For customer closeness to be achieved, systems must be put in place for gathering
data about the customers, analysis, implementing change based on the analysis
 EX: Feedback is easily obtained via social media, web sites …

 It is beneficial to understand the competitors’ customers as well

 Customer closeness is especially emphasized in services


 Higher level of contact
 EX: Restaurant service depends not only on the food, but on the waiter and the
facility as well
INFORMATION AND FINANCE
 Information systems should be well designed and the information should be
fast and easily obtainable
 Well-designed IS are the institutional memory for customer needs

 Nowadays, that is paramount


 EX: E-banking, m-banking
 The objective of a quality information system is to gather information relating
to key variables that affect customer service and product quality
 Better information leads to better customer service

 The actions required to make the IS effective are: problem identification,


analysis and corrective action
INFORMATION AND FINANCE

 Financial resources are necessary to provide the infrastructure and services


customers want
 EX: Quality ingredients for restaurants, state-of-the-art equipment in hospitals

 High quality can improve results and enhance financial stability

 World-class companies are usually financially successful

 Companies that are financially successful are able to invest in systems that
will satisfy the customers; and high-quality processes, products … lead to
financial success
 The building blocks provide the foundation to the quality system that
supports the three key spheres of quality – quality MNG, quality assurance
and quality control
 The spheres are related to enterprise capabilities and customer service

 Enterprise capabilities – capabilities that make companies unique and


attractive to customers
 EX: Improving productivity, timely responding to customer demands …
INTERNAL VALIDATION
 It is difficult task for managers to find new ideas for improvement
 Benchmarking is used to observe the practices of others and achieve even
higher levels of performance
 What is next when the firm is the benchmark?

 When the company achieves benchmarking status, the ideas and initiatives
for improvement come from within
 Self-assessment is good tool to stimulate improvement

 Self-assessment is done by observing current practices and assessing them


and identifying gaps in deployment
STAGES IN SELF-ASSESSMENT

Surveying – generate list of strengths and weaknesses from primary


and support activities of the firm’s value chain

Categorizing the strengths and weaknesses. Strengths can be


categorized as strategic resources or capabilities that can help the
improvement (marketing, design, technology …)

Investigating the sources of competitive advantage. How the firm


markets itself, differentiates from competitors, achieves CA …
Determine where along the value chain lies CA

Evaluating the competitive advantage to assess how the relevant


resources and capabilities are in terms of generic strategies (cost
leadership, differentiation and focus). Choosing the appropriate
strategy
QUALITY AUDITS
 Quality audits are not audits as tools for ensuring that generally accepted
accounting principles are being followed
 Audits as internal assessment tool to identify areas for improvement

 Quality audits study ways to improve customer service and ascertain


whether current customer service processes are being performed
 The audit process is based on: standards, procedures, reporting practices …

 The audit should be planned and executed in objective and unbiased


manner
 Audits should not be designed to select only the “right” evidence
 They must be designed and conducted to gather all relevant facts, weighing the
“good” against the “bad”
STEPS IN AUDITS

Familiarization

Verification

Evaluation

Recommendation
QUALITY AUDITS
 Requisites for accurate audits:
 In-depth knowledge of auditing standards
 Proper establishment of audit objectives
 Planned audit procedures
 Controlled execution of audit steps
 Adherence to audit methods in arriving at conclusions
MAIN INGREDIENTS OF AUDITS:
• Fundamental truth, rule
• They guide the auditor (they indicate the objective); They constitute the
Auditing
principles basis for the application for audit procedures in a logical manner

• Performance measuring device


• EX: The audit must be performed by a person having adequate technical
Auditing
standards training …

• Establish the course of action available to the auditor to judge the


Auditing adherence to the standards
procedures
QUALITY AUDIT PROCESS

2. Audit team 3. Develop 4. Opening


1. Preparation
selection checklists meeting

8. Reporting 5.
and corrective 7. Exit meeting 6. Analysis Implementing
action audit

9. Follow-up 10. Closure


PERFORMANCE AUDITS (1/2)

Supplier • Conducted by purchaser of the suppliers


• Purchasers spend time developing their suppliers (supplier
audits development)

Certification • Used to maintain a certification like ISO


• Focus on adherence to the standards
audits
• Involve site visits to externally validate the applicants’ claims
Award audits (Baldrige)
• Are intended to verify the information provided by the applicant
PERFORMANCE AUDITS (2/2)

Consultant • Performed by consultants to help identify


areas to be addressed in future quality plans
audits

• Performed by a team lead by the president of


Presidential the company. It gets him involved.
• Q&A session and site visits lead to overall
audits assessment
• Page 440
 Some audits are more quantitative
 When they focus on issues like conformance and quality control (trends in defect
rates)
 Qualitative audits compare current practice against structural measures
(documents: contracts, procedures, regulatory requirements...)
 Studies are performed to see that procedures are being followed (EX: If employees
use structured processes for decision making)
BENEFITS OF PRESIDENTIAL AUDITS
 The audit is good for the president. He/she is forced to study about quality
control
 The president can discover the true state of the company. The truth is not
always reported to them
 There will be improvement in the human relationship between the president
and the subordinates
 For the employees whose QC activities are audited, it is significant occasion
(it can be occasion for challenging employees and stimulating enthusiastic
activities in the total quality control)

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