As I pack my bags to fly back to London from San Francisco, they are significantly heavier. One reason is that they contain a huge piece of brass I just received from the American Society for Quality, the Spencer Hutchens Junior Medal. And because I had to kick off the society's first pathways to social responsibility conference here, my brain is also a bit heavier – thanks to all the information I have had to absorb about the links between total quality management (TQM) and things I normally think about.
I started the quest with something of a prejudice. It had long seemed to me that the quality movement can at times aggravate the silo-ing that my concept of the triple bottom line has sometimes promoted, at least when poorly understood.
Consider the International Standards Organization. It launched its first quality standard, ISO 9000, in 1987, focusing on the management of quality in business. Later, in 1996, it came up with its family of environmental quality standards, starting with ISO 14001. And most recently we have ISO 26000, released in 2010 and designed to bring social responsibility into the fold.
But there is no overarching framework that pulls all of this together. As a consequence, I have long suspected that the TQM approach can potentially stifle innovation at a time when we need disruptive solutions to drive the necessary system change.
So I was somewhat surprised, as I Googled my way around the quality landscape, to stumble upon a Korn/Ferry International white paper suggesting that "Sustainability is the Next TQM".
The theme has been picked up by others, including Mike Fraser of Source 44 in San Diego. He argues that TQM can become "even more compelling and exciting" if it works out how to embrace sustainability. "It's not about Cap and Trade," he says. "It's not a Democratic or Republican or Tea Party thing. It's about good business."
He referenced the 2009 article by Ram Nidumolu, the late CK Prahalad, and MR Rangaswami in the Harvard Business Review that declared sustainability to be the "key driver of innovation". Their research of 30 large corporations was summarised in one key statement:
"Our research shows that sustainability is a mother lode of organizational and technological innovations that yield both bottom-line and top-line returns. Becoming environment-friendly lowers costs because companies end up reducing the inputs they use. In addition, the process generates additional revenues from better products or enables companies to create new businesses. In fact, because those are the goals of corporate innovation, we find that smart companies now treat sustainability as innovation's new frontier."
On the sustainability side, we often forget the intense evolutionary curve that the quality movement raced up in the 1980s as new standards and expectations triggered immense changes in business. So the fact that TQM does not yet fully embrace sustainability today does not rule out a powerful convergence in the future.
Looking back at the quality revolution, I see strong parallels with where we find ourselves today. Early on, a few businesses decided to view "quality as an opportunity rather than a cost, and their investment in TQM paid off handsomely". To make this happen, leaders had to think completely out of the box.
"Rather than simply posting an inspector at the end of an assembly line," Kust and Walker recall, "Toyota, Motorola, General Electric and others integrated quality considerations earlier in their assembly lines and into processes that preceded manufacturing, such as product design and R&D. Next, those companies pushed quality considerations even further upstream by working with suppliers to develop quality standards for the materials flowing into their organisations."
Later, TQM leaders took another step, expanding quality management beyond products into behaviours. They asked how their people could collaborate more effectively to ensure high quality outcomes, every time. And this brought them to the question of zero – the focus of The Zeronauts, a new book I'm writing.
The term "zero defects" (ZD) was coined by Philip Crosby, who came up with a 14-step quality improvement process. This enjoyed considerable popularity through the 1960s and 1970s. A central concept was the need to "vaccinate" business leaders against what he saw as the poor quality virus, to prevent a willingness to accept "close enough" outcomes.
The roots of the zero defects movement can be traced back to the Martin Marietta Corporation, later Lockheed Martin. Years later, Crosby recalled that when the Martin Marietta embraced zero defects, employees welcomed the programme "with open arms. Everywhere it was presented, the defect rates dropped, morale improved, and there was a feeling of accomplishment. Ideas for preventing problems emerged by the batch."
Unfortunately, the zero defects approach soon hit a wall, both at Martin Marietta and elsewhere. As Crosby put it a couple of decades later, "much of the enthusiasm and activity dropped off after a year or so when it became clear in most companies that the management had feet of clay. They still wanted to deliver materials that didn't meet the requirements if that was what it took to comply with the schedule and cost obligations."
The result was that "many thought leaders came to think of the ZD approach as 'an infantile, motivation-oriented, impractical program'." The Japanese, however, thought differently – embracing much of the thinking and evolving their kaizen philosophy, focusing on "continuous improvement" and "change for the better".
Among the hostiles, interestingly, was the Godfather of Total Quality Management, W Edwards Deming – often credited with sparking the Japanese kaizen revolution. He pushed back, promoting the concept of acceptable defects, arguing that the pursuit of zero could lead to an immense waste of time, effort and money.
So, I discover, zero comes with its own heavy baggage in the world of TQM, but my conversations with the ASQ top brass persuaded me that, as the convergence accelerates between TQM and sustainability, we will see zero back in the spotlight. Our challenge, once again, will be to avoid past mistakes while, inevitably, making the interesting, necessary mistakes of the future.
John Elkington is executive chairman of Volans, co-founder of SustainAbility, a member of the IIRC, blogs, tweets and is a member of the Guardian's sustainable business advisory panel.
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Comments in chronological order (Total 5 comments)
23 June 2011 12:49AM
I think it is and that is not a good thing. Totally quality was a separate program that made it not a part of business. And it was filled with standardizing everything which puts people on automatic and diminishes innovation. And worst of all, it was about errors, not working on the potential of something. Both are about "arresting disorder" by reducing errors or doing less harm. Neither are about creating.
Real health of ecosystems comes from working with systems as living entities, not something to be wrestled to the ground until most errors are avoided or the least harm is achieved. That is like working with your children to get all the bad behavior out of them and forgetting who they uniquely are and what is their potential to be developed into the world as an amazingly creative being.
I see Sustainability being approached the same way now. I write blogs everyone and comment everywhere to challenge the current paradigm of sustainability.And by the way, it has to move from ONLY the triple bottom line to the quintessential top line. The top line is where new growth takes place and where new potential is realized. It we learn how healthy ecosystems work and engage to create their regeneration, and this is done for the system as a whole, we can skip the whole programmatic nature of how we work on sustainability.
For more, check out my new book, The Responsible Business, (listed by CNBC as best read for Biz 2011, and my blogs at www.carolsanford.com, CNBC and SSIR among other places). The book is filled with stories from leaders around the globe who skipped TQM but had better quality and business results, better ecological and social top line contributions as PART of doing business, than their competitors. Both public and private, Fortune 100 and local entrepreneurs, hi and low tech. Stories never told... until now.
23 June 2011 4:41PM
At a high level, I see this is a welcome convergence and should be encouraged rather than discouraged. We talk about "embedding" sustainability throughout an organization, but to do so, we need everyone on board. And quality professionals can help take those of us who are passionate about sustainability and want strong results to that next level.
Reducing waste, inefficiencies, energy--and at some level, "defects," ties in to (whatever your moniker may be) . . . "sustainable," "green" products & services etc. From a consumer's point of view (say my parents or friends who have vague awareness of these issues), he or see often buys products that have some certification because the truth is, they are often better than something that comes from a dodgy factory far, far away...
I understand the fear of just focusing on cost, or focusing on efficiency--but I am a realist, so I see quality professionals joining this conversation as a positive development.
28 June 2011 7:52AM
@carolsandford
One manifestation of responsible business is the form defined by Muhammad Yunus as social business which is non dividend distributing with a primary social objective.
Today in Bangladesh is Social Business Day and there's a live video feed here.
As a social business we've advocated that business can and should have both a social and financial objective. In Economics in Transition we make the case for an economic paradigm which is itself sustainable.
http://sustainablebusinessforum.com/jeffmowatt/52763/economics-transition
29 June 2011 8:47AM
Sustainability is practically the result of religiously following an important element of Total Quality Management, which is, continuous learning and improvement. Many quality practitioners and quality executives fail to realize that TQM is very comprehensive, dynamic and is really a way of life, if not a management philosophy. You have with you various management tools, concepts, technologies and systems that you can use to integrate in your existing management system. From a historical perspective it is clear TQM evolved from several lead proponents who used various methodologies and concepts to bring about quality products. The “total quality company” exists where people want it to exist, and are willing to work together in creating it for themselves. TQM was never a one-man show, whether historically or conceptually. Total means that everyone from the President or CEO down to the lowest rank-and-file participates in quality initiatives and that it is integrated into all business functions. Quality means meeting or exceeding customer (external and internal) expectations. Management means improving and maintaining business systems and their related processes or activities. Given all these, total quality management is a philosophy, a science, a work ethic, a process, and a system. It is a continuous transformation of people and organizations. Total Quality Management is now a global necessity, an organizational imperative and a personal ethic. Its message is clear: “We are all in this together. Quality is everyone’s responsibility.” Borrowing W. Edwards Deming words, he once said: “Long-term commitment to new learning and new philosophy is required of any management that seeks transformation. The timid and the fainthearted, and the people that expect quick results, are doomed to disappointment.”
29 June 2011 9:12AM
My first job was for Nissan SA in 1994. I was fresh out of Yale and ISO 14 001 was in the offing. I was so keen to introduce these clever systems - and there in the factory, the systems were working very well thank you very much. The kaizen teams met every morning and I realised the redundancy of much of what the emerging ISO standard (and I) had to offer.
Good quality management requires a commitment to continual improvement and working together: very intelligent and very much in line with sustainability. Of course, there will be some masters who apply TQM in a breakthrough way, but for most of us, I think the TQM mindset is unlikely to drive disruptive change.
And for the most part, sustainability is not doing it either. We have been so focused on integrating it into the business strategy and management systems (including TQM) that we are in danger of losing its edge.
To embed sustainability too comfortably is to settle for the booby prize: we forfeit the creative tension, the engine of the innovation-driver.
To work with sustainability is to work with tension. To do this requires a special kind of fitness. It's the fitness we should be talking about – what competencies we need to develop, what practices develop them – whether we call the outcome sustainability or quality is probably less important.