Quality can’t be achieved by prescribing a set of tools, concepts or policies, it is the use of measures to promote a culture of quality in an organization. That is the conclusion of a study on best practices in enterprise level quality measurement released by APQC, a benchmarking and best practices research organization. The report, produced with support from the American Society for Quality, provides a basis for organizations to evaluate their enterprise quality processes, identify practice gaps, and adopt practices that create business value.
The research compiled findings about the extent of quality programs within large enterprises. Key findings report that:
• 81% of respondents agree or strongly agree that their organization’s enterprise quality management directly aligns with overall strategic goals and initiatives. However, further discussions revealed most have aligned only one or two core business processes.
• A typical quality measurement framework should have no more than five key performance indicators and five supporting indicators. Although there were differences between manufacturing and service organizations, the median for all survey participants was less than 10.
• 67% of participating organizations establish quality measures at the enterprise level, 19% do so at the business unit level, and 5% at the product or service level. 10% do not establish enterprise quality measures.
• If staff members are measured and compensated based on quality measures that focus on value-add activities, employees will focus on those activities, and eventually, the culture of the organization will naturally eliminate work that does not add value. 67% of respondents agreed or strongly agreed that their organization uses enterprise quality measures as part of variable performance compensation.
“Quality is a well-established discipline with many tools, best practices, and frameworks,” said Travis Colton, project manager, APQC. “Yet, the application of quality at the enterprise level has not been well documented or extensively analyzed. Quality leaders themselves have questions about the best way to structure an enterprise quality function and the best methods to influence the culture so work aligns with organizational goals.”
The report outlines the following best practices where quality is concerned:
• Enterprise Quality Oversight:
—Align enterprise quality with strategic goals and initiatives;
—Establish structures and resources to get the desired results;
—Create supporting policies, procedures, and tools—not mandates.
• Measurement Process
—Select, define, and standardize quality measures across the enterprise;
—Allow business unit leaders to establish the performance targets for enterprise quality measures;
—Report enterprise measures at least quarterly.
• Quality Culture and the Support of Business Value
—Design quality measures to focus on value-added quality activities and core strategic objectives;
—Use measures to promote a culture of quality.
The report features insights from companies identified with best practices in enterprise quality—Altera Corp., Caterpillar, Inc., Chemonics International, and Textron Systems. Responses from these organizations provide detail about how they organize quality functions, measure their impact, and ensure that a culture of quality is used to drive business value.