American business is embracing the concept of Total Quality Management (TQM). For years, Peter Drucker, Tom Peters and a host of consultants have advised business leaders to commit to the quality-first tenets of guru W. Edwards Deming. Sure, TQM is spreading around the country, but it is remarkable how few American businesses have made it the core of their operations.
First, some background. TQM is not for the faint-hearted. Before it has the slightest chance for success, it must have the solid commitment of the CEO and top management. TQM seeks to weave quality through every aspect of a company's operations, using customer focus as its unifying thread.
While that sounds simple enough, the problem for many companies is defining the customer. In common usage, it refers to the end-user of a company product or service, usually the person who forks over the cash. TQM defines the customer more broadly.
Take the auto worker. Her customer is not only the car buyer, but the crew down line, which depends on her workmanship to do their jobs right. Once all customers are identified, feedback loops must be created so that quality is constantly monitored. Everyone is a quality control monitor, responsible for creating the best product or service possible. The bottom-line: TQM works.
Lately I've noticed my trickle-sideways theory of management appears to be gaining momentum. This theory holds that management concepts that work in one sector will eventually filter over to the others, from the private to the non-profit sector, for example. The theory allows for the flow to go either way, except for the flow from government to anywhere else, since that artery seems perennially blocked by bureaucratic atherosclerosis.
Enough about theories, on to some practical issues about TQM, which is just beginning to take hold in the non-profit sector. Non-profit managers generally had avoided tackling the Total Quality Monster, incorrectly assuming it is better suited for for-profit businesses.
But quality is not restricted to manufacturing. Quality also involves issues such as customer service and customer satisfaction -- issues harder to quantify, but critical to corporate success.
The local chapter of a prime American non-profit is beginning to implement a TQM process. The American Red Cross, Blood Services Division, has just completed preliminary upper management discussions of TQM, bolstered by a two-day retreat and follow-up meetings designed to help them meet the challenges -- and opportunities -- of the next 20 years.
"Customer service is the most compelling reason to implement TQM," CEO David Simms said. "We're not just chasing quality, we're looking to service our customers, the external users of our products and services, our volunteers, our staff."
A series of crises concerning the safety of the blood supply precipitated the Blood Services Division's intense self-examination. "It's hard to reorient your thinking to run more as a business with competition, customers, products and all the other factors you need to consider today," said Kathleen Dickinson, director of communications for the Central Maryland Chapter.
Next week, we'll look at characteristics of TQM for non-profits and some implementation tips.
Lester A. Picker, a consultant in the field of philanthropy, works with charitable organizations and for-profit companies.