Monday, 31 March 2008

Remember this one: “Total Quality Management”?

As I have said before, firms often imitate each other, and that includes imitating silly things.

Speaking of silly things; Mark Zbaracki, a professor at Wharton, found himself examining Total Quality Management (TQM) techniques in the early 1990s, when the thing was at its heyday. He made extensive visits to five organisations – a defence contractor, a hotel, a hospital, a manufacturing firm and a government agency – to figure out how they came about adopting TQM.

A very consistent pattern emerged. Invariably, when management started to hear about this “new thing” called Total Quality Management, they signed up for seminars and conferences in which representatives from other firms spoke about their experiences with the implementation of TQM. There they would hear about the substantial improvements TQM had brought them, often larded with impressive statistics and commanding jargon. It didn’t take long and the managers became convinced that they too had to make work of adopting this new technique, or risk falling behind forever.

So they started sending their people to TQM training courses and hired consultants that specialised in the new techniques, through which they learned more stories about the power of TQM and its remarkable results. Soon, they put their considerable weight behind a pilot: one department would experiment with the new techniques, so that others could learn from them.

This was often followed by the introduction of a series of internal seminars, a quarterly TQM newsletter sent to all departments within the organisation, and the appointment of dedicated internal TQM experts. Subsequently, all these parties were told to publicise the firm’s early “success stories” to enthral others and raise their enthusiasm to embrace the new technique with equal vigour.

Soon, the newsletters found their way to people at other companies, and the organisation’s managers started to receive invites to come and share their success stories at TQM conferences and seminars. Yet, in reality, every success story also had its problems, and for every “success story” there were always a handful of failures. Yet, those stories did not find their way into the newsletters, the company’s external communications, or the manager’s seminar slide pack.

And in the conference room, the attending managers, who had heard about this new technique called “Total Quality Management”, were in awe of the substantial improvements that TQM had brought the speaker’s firm, and they were impressed with the gleeful statistics and commanding jargon. And they too went back to their firms, and pro-claimed that they really had to make work of adopting this new technique, or risk falling behind forever.

10 comments:

Mao Enn said...

The point that can be made is as follows:

Sometimes an idea or unit of information is successfull at spreading (or replicating), even though there are better ideas or units of information ou there. Using a evolutionary analogy, the factors that make an idea good at survival (through spreading to different organisations, being adopted etc.) may not be the same factors that suit that idea to the problem at hand. Put another wy, the 'perfect' management idea might be out there, but might not have enough 'share me' factors to survive and be implemented.

Freek said...

Good point. Dawkins describes the process well in his book "The Selfish Gene". The factors that make "an idea" useful may not be the exact same factors that promote its diffusion. It relates closely to my previous post: http://freekvermeulen.blogspot.com/2008/01/management-consultants-pin-striped.html in case you're interested.

Mao Enn said...

Ok, I can see the issue here.

Simply put, in some cases an idea exists that is compelling, and convincing. This idea may not be a good idea, but ultimately may not be the best idea readily available.

On one hand, Management Consultants sometimes want to sell ideas (or assets) investing the lowest amount possible in them (e.g. if they can already point to a 'success' case, then there is less of incentive for them to spend profits on improving them).
On the other hand, Management Peers in Industry sometimes want to sell ideas because it (1) makes them look good/innovative/successful, or perhaps because (2) expecting improvement, can become a self-fulfilling prophesy (http://freekvermeulen.blogspot.com/2008/02/right-again-managers-and-their-self.html).


*******
Bearing this in mind,

(1) What do you recommend top managers do to determine whether an idea (I've been using that term liberally here) should or should not be implemented in their organisation?

(2) How do they credibly stop 'bad' ideas given that they cannot determine with certainty which ideas are 'bad' and which are good?

(3) How do they counter resistance in the form of "Well it worked in ABC....why can't we try it"?

…and finally, (4) Are we sure that acceptance of 'bad' ideas is in itself a 'bad' thing - who has considered the alternatives?

Freek said...

By definition, persistent "bad practices" are difficult to spot and expose, because if it was evident that the practice was bad nobody would adopt it. Hence, sometimes ideas emerge that are obviously bad, but such ideas also quickly disappear again.

So what can you do to analyse whether a practice might be bad?

1) analyse both the potential advantages and disadvantages (all practices will have some of both). IF the advantages are immediate but the disadvantages long-term be aware, because this just might be one of those temptations that will be bad for you in the long run.

2) If the practice is relatively easy to copy, be suspicious too. Easy-to-copy practices seldom give a true competitive advantage. Moreover, harmful practices by definition will be easy to copy and hence "contagious" (much like a virus).

3) Finally, if you question the usefullness of a certain long-standing practice in your industry and you hear someone (or yourself...) say "look, it is difficult to explain why this practice is good, but everybody does it this way, and everybody has always been doing it this way, so if it wasn't the best way to do things I am sure it would have disappeared by now" be very suspicious...! Bad habits don't necessarily die out. If YOU can't explain why this practice in your industry is good, there is a fair chance that it isn't.

holy said...

good article .. very informative .. could be a reference for my article

Avery Gerner said...

Oh yeah, the TQM course is indeed a training program that increases the work quality of your employees. You can look at it as an insurance that will protect your company despite all other exterior factors.

Catherine Aird said...

Hey buddies, such a marvelous blog you have made I’m surprised to read such informative stufPresident AQM

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