The CEO and a mid-level quality manager stepped into an elevator for a ride to the upper floors of the high rise office. The CEO acknowledged the manager with a nod and a question. "How are we doing on quality these days? Our competitor seems to be in real trouble over theses quality issues", she asked. The manager took a deep breath and then delivered a message that had been on his mind for months.
"We also have trouble with quality, although they are not quite as dramatic as that other company. However, the cost of error, waste and inefficiency are costing us 15% of our operating costs.
We have to have a culture that encourages every individual to strive for 'error-free' performance instead of 'that's good enough'.
Those costs are hidden, but they are there. Making quality happen doesn't have to cost any more than 2% to 4% of operating cost to pay for a complete, prevention-oriented system. To get there, we need to define quality as 'conformance to requirements', not goodness. We need to use prevention to cause quality, and not inspection and rework to deal with the bad stuff. We have to have a culture that encourages every individual to strive for 'error-free' performance instead of 'that's good enough'. We must measure quality like we measure all things that are really important to management, by calculating the financial cost of quality problems. If we can do that, and if we get management commitment to implementing the things I've described, we will avoid the issues that plague our competitor."
And with that, the elevator stopped and the middle manager got off. That CEO was left to ponder what she had just heard. She thought "Could it really be possible? Was it really that simple?"
I first heard that story when Philip B. Crosby asked me to join "The Quality College", a consulting and education firm built around his pragmatic management theories and philosophy. In the decades that have passed since that discussion with Phil, I can see that his cultural approach to quality is needed more today than ever. Just ask General Motors.