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HOW COULD A QUALITY SYSTEM CONTRIBUTE TO THE DEVELOPMENT OF A COMPANY

by J. N. Abbott, Quality Manager in INTERKLARK

Kicking off this conversation about the benefits of a QS we are aware that  a negatively biased majority, that rejects the practicality of the QS, stand strictly against. As we have discussed in previous articles there is no obvious reason for this attitude except the human distaste for changes and disturbance of existing balances. Quite expected, someone could argue. Yes, quite expected for all ordinary employees except the business executives and, of course, the  business owners themselves. Because being at the head of an organization/business and reject the usefulness of a QS is strange if not absurd!

Therefore it is quite a challenge to try justify why a QS is a valuable tool for every business big or small and why it is advisable that businesspeople should reserve a second thought about their objections.

First of all, the QS includes the concept of “Quality”. Now, “Quality” is not an abstract idea about something or someone being qualitative. It does not have to do with etiquette or attitudes. It is not a fictional idea. Quality is equivalent to the idea of improvement and particularly the idea of self-improvement. Quality means not to be pleased with what you have achieved, quality means that you have to be outgoing and  extravertive, quality is to believe in humanism, quality is the willingness to offer opportunities, quality is the commitment to drive other people to self-improve. And furthermore, quality is to support your group, quality is to guarantee the safety, quality is to offer incentives. Now, is there anyone who could doubt that this is a bunch of extra-positive features?

We suppose not, but when it comes to the harsh everyday life and human behaviour, then things change, masks fall and idealisms retreat. It is the moment when the businessperson wonders “what’s in it for me?”. Although the quality talk in a business is not primarily about monetary profit but about a human, safe and highly society-friendly business, the conclusion is the remuneration , at some point, for all these qualities. Someone could call this remuneration “turnover”, or  “profit”!

So, self-improvement means that an employee will improve her/his skills and become more productive. However, self-improvement means that the employee sets goals concerning her/his performance. A goal for example could be to reduce personal downtime by 10%. Theoretically this means that the employee creates a time surplus that can be used for either training or even further productivity. The supervising manager could interpret this as a 10% rise in the sales performed by the employee.   Likewise, an executive, a manager, or the business owner must also improve skills of identifying the environment in order to be able to organize his thinking, to make decisions and deploy strategies.  

The QS demands, almost imperatively, an accurate organogram, job descriptions and scheme of the workflow. This is a safe way to eliminate “grey areas” of responsibility in the workflow. Areas, that is, where no employee would take over the responsibility to accomplish the tasks of this area. “Grey zones” in the workflow mean increase of downtime until someone (an executive ie) decides who and how will perform the needed task, therefore extra cost. On the other hand, a stable and realistic organogram defines who is responsible for decisions so that these are taken on time, saving, in turn, time and effectiveness. 

Talking about downtime, what are the main reasons for wasting productive time in a workflow? Absences, mechanical failures, low productivity… how, could a business fix these problems? By improving the working environment: a safer, healthier, happier environment protects personnel from accidents (of any kind), protects the machines from failures and provides the motives for creational work which is the key to a productive work. A QS sees to all these not as a simple task but as a definitely must-do, first priority obligation. A small investment in training and safety equipment, and on-time maintenance of the machinery can prevent serious problems, can keep the personnel safe and the machines running. If, for example, a retail business with 10 employees counts 5 absences (illness, injury) per employee per year this means that, in total, there are 50 absences per year. Multiplied with a low average wages €28,00, the cost is €1.400,00 per year. Yet, the damage is bigger since one absence impedes the workflow and reduces effectiveness by 10%. And it would be no surprise if the turnover of the day is 10% lower than the daily mean . Practically this means that for 50 days per year – which is equivalent to 2 months, the turnover is 10% less than regular.

Talking about downtime, what are the main reasons for wasting productive time in a workflow? Absences, mechanical failures, low productivity… how, could a business fix these problems? By improving the working environment: a safer, healthier, happier environment protects personnel from accidents (of any kind), protects the machines from failures and provides the motives for creational work which is the key to a productive work. A QS sees to all these not as a simple task but as a definitely must-do, first priority obligation. A small investment in training and safety equipment, and on-time maintenance of the machinery can prevent serious problems, can keep the personnel safe and the machines running. If, for example, a retail business with 10 employees counts 5 absences (illness, injury) per employee per year this means that, in total, there are 50 absences per year. Multiplied with a low average wages €30,00, the cost is €1.500,00 per year. Yet, the damage is bigger since one absence impedes the workflow and reduces effectiveness by 10%. And it would be no surprise if the turnover of the day is 10% lower than the daily mean . Practically this means that for 50 days per year – which is equivalent to 2 months, the turnover is 10% less than regular.

Both the issues mentioned above are key issues for a QS: safety and maintenance. It is not hard to understand how much could close attention and conformity to the safety and maintenance standards benefit the workflow, the productivity and, in the end, the profit of the business.

Finally, a mention to the Risk Management. A peculiarity of RM, which, confessedly, does not enjoy much publicity so far, and is- strangely- underestimated, is the fact that risks are tightly linked with opportunities. This is a subtle point that 90% of managers just ignore, mainly because it sounds like a paradox. However, a closer look would confirm this connection between risks and opportunities on the grounds that if a risk is avoided or successfully resolved, then it can easily be counted in as an opportunity. Particularly if the competitors fail in taking any equivalent protective measures. As we can see, through this association,  a risk turns into an attractive challenge: because the fastest we get rid of it the more we benefit.  

Notice that it is very important to base our understanding of the environment on this risk-opportunity dipole. Actually, what we have to do is not to wait for the risks to appear first and then try to avoid them. What we have to do is to conceive the changes in the environment and act accordingly. Because a change can develop into either a risk or an opportunity with -theoretically- equivalent probabilities and this is up to us to handle. So, the idea is, “don’t stand there anticipating forthcoming risks but transform any change into an opportunity before even think of it as a risk”.

But even if we successfully face a risk that cannot be transformed into an opportunity, yet, avoiding it or “fooling” it, is a pure profit in itself. If for example, a (already registered in our QS RM documentation) risk indicates the rise of the US dollar price within 3 or 4 months, this info almost imposes the Purchasing Department to proceed with early purchases that would cost eg 10% less than if done in the future.  In general, Risk Management is a flexible and powerful tool in the hands of the management team that shouldn’t be understated.

Conclusively, it is clear that QS offers invaluable support in decision making, risk management, preservation of safety and workflow. If we sum up the money profit, it makes us thousands of euro yearly. But the most important is that QS guarantees the trustworthiness of the company, the moral of the personnel and the increase of the value of the company.

Acronyms: QS=Quality System, RM=Risk Management 

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