A History of Managing for Quality

in the United States

by J.M. Juran

During the 20th century, there emerged a growth of public

suspicions and fears relative to the negative byproducts of
industrial progress. These fears are evident in multiple trends,
all quality-related:

Fear of major disasters and near disasters resulting from quality

failures. Growing concern about damage to the environment. Action
by the courts to impose strict liability. Public annoyance with the
numerous minor quality failures. Growth of consumer organizations
and an associated demand for better quality and more responsive
customer service.

These trends are traceable to society's adoption of technology and

industrialization. Technology confers wonderful benefits on
society, but it also makes society dependent on the continuing
performance and good behavior of technological goods and services.
This is "life behind the quality dikes" a form of securing benefits
but living dangerously. Like the Dutch, who have reclaimed much
land from the sea, we secure benefits from technology. However, we
need good quality to protect us against the numerous service
interruptions and occasional disasters. These same trends have also
led to legislation which at the outset was bitterly opposed by our
industrial companies. Since then it has become clear that the
public is serious about its concerns and is willing to pay for good
dikes.

The response of progressive companies to "life behind the quality

dikes" has consisted mainly of: Creation of high-level committees
to establish policies and goals with respect to product safety,
environmental damage and consumer complaints. Establishment of
specific action plans to be carried out by the various company
functions. Audits to assure that the action plans are carried out.

In addition, the ingenuity of companies has begun to find ways to

reduce the costs of providing solutions.

The Japanese quality revolution and its impact

than by military means. The major manufacturers, who had been

extensively involved in military production, converted to civilian
products. They then found that a major obstacle to selling these
products in international markets was Japan's reputation as an
exporter of shoddy goods.

This major obstacle convinced the Japanese of the need to improve

their quality reputation. The shock of losing the war made them
willing to explore new ways of thinking about quality, including
learning from other countries. Through Keidanren (the Japanese
Federation of Economic Organizations) and JUSE (the Union of
Japanese Scientists and Engineers), the Japanese companies acted
collectively.

They sent teams abroad to visit foreign companies and study their
approaches to managing for quality. They translated selected
foreign literature into Japanese. They invited foreign lecturers to
come to Japan and conduct training courses. These lecturers, W.
Edwards Deming on statistical methods and J.M. Juran on managing
for quality, provided seed courses that became influential inputs
to the quality revolution that followed.

Building on these and other inputs, the Japanese adopted some

unprecedented strategies for creating their revolution in quality:

The upper managers personally took charge of leading the

revolution. The companies trained their engineers and the work
force in how to use statistical methods as an aid to control of
quality. The seed courses were Deming's 1950 lectures. They trained
the entire managerial hierarchy in how to manage for quality. The
seed courses for this training were Juran's 1954 lectures. They
undertook quality improvement at a revolutionary rate, year after
year. They evolved the QC circle concept to enable the work force
to participate in quality improvement. They enlarged their business
plans to include quality goals.

During the 1960s and 1970s, many Japanese manufacturers greatly

increased their share of the U.S. market. A major reason was
superior quality. Numerous industries were impacted: consumer
electronics, automobiles, steel, machine tools and so on. Some
researchers quantified the quality differences. See Juran, 1979
(color television sets); also Garvin, 1982 (room air conditioners).

The impact of the Japanese exports on the United States was

considerable. Consumers benefited greatly by access to goods of
superior quality at competitive and even lower prices. However,
great damage was done to other areas of the U.S. economy: The
impacted manufacturing companies were damaged by the resulting loss
of market share. The work force and the unions were damaged by the
resulting export of jobs. The national economy was damaged by the
resulting unfavorable trade balances. Collectively, these impacts
called for responsive action.
Interestingly, some people believe that had the two Americans
(Deming and Juran) not given their lectures, the Japanese quality
revolution would not have happened. In the view of the author, this
belief has no relation to reality. Had the Americans never gone
there, the Japanese quality revolution would have taken place
without them. Each of the Americans did bring to Japan a structured
training package that the Japanese had not yet evolved. In that
sense, each gave the Japanese a degree of jump-start. But the same
Americans also gave their lectures in other countries, none of
which succeeded in building such a revolution. That is why the
author has told his audiences that, "The unsung heroes of the
Japanese quality revolution are the Japanese managers."

Responses to the Japanese quality revolution-Price competition

In the early postwar period, the impacted U.S. companies logically

considered Japanese competition to be in price rather than in
quality. (Japanese wages were far below those in the United
States.) So one major response was to move the production of labor-
intensive products to low-wage areas, often off-shore.

Lack of early warning

As the years unfolded, price competition declined while quality

competition increased (Juran, 1979). At the outset, Western
companies were clearly the quality leaders. Moreover, they
continually improved their products, but at a gradual, evolutionary
rate.

In contrast, Japanese automotive quality was at the outset well

below that of the West. However, the Japanese undertook to improve
their quality at a revolutionary rate, enabling them to overtake
the West during the mid-1970s.

The U.S. upper managers were generally unaware of these trends. The
reports available to them consisted mainly of financial
information. In those days, the executive instrument panels lacked
information on customer satisfaction, competitive quality, cost of
poor quality and the like. So the managers continued to believe
that Japanese competition was primarily price competition rather
than quality competition.

In June 1966, at the conference of the European Organization for

Quality Control (in Stockholm), the author sounded a warning:

"The Japanese are headed for world quality leadership and will
attain it in the next two decades because no one else is moving
there at the same pace." (Juran, 1967)
That warning went unheeded. To the West, it was unthinkable that
Japan, of all countries, could become the world quality leader.

Efforts to become competitive in quality

During the 1960s and 1970s, a growing quality crisis became

evident, and company managers became increasingly concerned. Some
upper managers recognized that the soundest response to a
competitive challenge was to become more competitive. Not being
trained or experienced in managing for quality, these same upper
managers sought advice from the experts, internal and external. As
it turned out, most experts were specialists in tools and
techniques, and tended to assume that what they had to sell
coincided with what the companies needed. As a result, a long list
of potential strategies emerged, including:
Exhortation of the work force
Organization and training of quality circles
Statistical process control
Awareness training for managers and supervisors
Computation of the cost of poor quality
Project-by-project quality improvement
Preparation of complete manuals of procedure
Revision of organization structure
Incentives for quality
Automated inspection and test
Automation and robotics

Every one of those (and other) strategies had some degree of merit
under proper conditions. However, the companies needed a plan of
action that addressed their major quality problems. Yet, in most
cases, the major quality problems had not been identified. In
companies where the design of the action plan was by a functional
manager, there was a risk that the plan would be biased toward the
goals of that function. Where the design was by the upper managers,
the risk was that they lacked the necessary training and
experience. They were experienced managers, but not in managing for
quality. Generally, they opted for "action now," that is, do
something plausible promptly rather than endure delay. The results
were predictably unsatisfactory.

The major initiatives of the 1980s

By the end of the 1970s, the U.S. quality crisis had reached major
proportions. It attracted the attention of national legislators and
administrators. It was featured prominently in the media- it was
regularly on the front page. It increasingly forced company chief
executive officers to provide personal leadership in managing for
quality.
During the 1980s, a great many U.S. companies undertook initiatives
to deal with the quality crisis. These initiatives focused largely
on three strategies: exhortation, project-by-project quality
improvement and statistical process control.

Results of the initiatives of the 1980s

In retrospect, the results of the quality initiatives of the 1980s

were deeply disappointing. Most of the initiatives fell well short
of their goals. Some achieved negative results\emdash the companies
lost several years of potential progress. The disappointing results
were due mainly to poor choice of strategies and poor execution of
valid strategies. In turn, these were largely traceable to the
limitations of leadership by upper managers, who lacked training
and experience in managing for quality. In the minds of some
observers, the lessons learned during the 1980s were chiefly
lessons in what not to do.

Customer focus

Adoption of this concept then led to intensified action to

identify: who are the customers, internal as well as external; what
are the customers' needs; what product features are required to
meet those needs; how do customers decide which of the competing
products to buy; and so on.

To illustrate, it is now widely recognized that many past quality

problems can be traced to failure to meet the needs of internal
customers. (A widespread example has been product designs that
designers "threw over the wall" to be made by the manufacturing
department.) The customer focus concept led to broader acceptance
of the participation concept internal customers should participate
in those planning activities that will impact their operations.

Upper managers in charge

One element present in all successes and absent in most failures

was the personal involvement of the upper managers. In effect, the
upper managers took charge of quality by accepting responsibility
for certain roles, including:
Serve on the quality council.
Establish the quality goals.
Provide the needed resources.
Provide the quality-oriented training.
Stimulate quality improvement.
Review progress.
Give recognition.
Revise the reward system.
Many upper managers resisted such additions to their own workload.
They preferred to establish broad goals and then urge their
subordinates to meet the goals. However, the lessons learned from
the role models are that the above roles are not delegable they
must be carried out by the upper managers personally.

Strategic quality planning

The role models recognized that the new priority given to quality
requires enlarging the business plan to include quality-related
goals. These goals are then deployed to identify the needed actions
and resources, to establish responsibility for taking the actions
and so on. The resulting plans parallel those long used to meet
goals for sales and profit. A common name for this concept is
strategic quality planning.

The concept of "Big Q"

The role models grasped the concept that managing for quality
should not be limited to manufacturing companies and manufacturing
processes. It should also include service companies and business
processes. This concept broadens the area under the quality
umbrella. It bears the name "Big Q," to distinguish it from the
traditional "little Q."

Quality improvement

Without exception, the role models went extensively into quality

improvement most of the stunning results came from projects to
improve quality. These projects extended to all activities under
the Big Q umbrella. They reduced costs, raised productivity,
shortened cycle times, improved customer service and so on.

Quality improvement required special organization. The vital few

projects were carried out by multifunctional teams of managers and
specialists. The useful many projects were carried out at lower
levels, including members of the work force.

The role models also adopted the concept that quality improvement
must go on year after year it must be woven into the company
culture. To this end, they mandated that goals for quality
improvement be included in the annual business plans. They also
redesigned the systems of recognition and reward to give added
weight to performance on quality improvement.

Training in managing for quality

The earliest formal training courses in quality-related matters
were the wartime courses in statistical quality control sponsored
by the federal government during World War II. Following the end of
the war, these courses were offered by some colleges (as extension
courses), by societies such as the American Management Association
and the American Society for Quality Control, and by consultants.
Then, as the company quality departments broadened their scope,
there emerged courses oriented by the functional needs of those
departments: inspection and test; quality engineering; reliability
engineering; advanced courses in statistical methodology, such as
design of experiments and analysis of variance.

During the 1970s, the quality crisis resulting from the Japanese
quality revolution emerged. As companies tried to respond, it
became clear that training should not be limited to the quality
department it should extend to all functions and all levels of the
hierarchy. Such extension required creating an expanded variety of
courses to meet the various special needs of the multiple functions
and levels.

It also became clear that training should not be limited to

exhortation and statistics it should be expanded to include
managing for quality. At the time, training courses in managing for
quality were still in the early stages of evolution. Many designs
of training courses emerged, and companies selected those that
seemed to fit the strategies they had chosen.

By the 1990s, numerous designs had become available for training in

managing for quality. No consensus had been reached, but some
designs were in wide use. One was based on the Baldrige Award
criteria. Another was based on Deming's lectures statistical
quality control plus his 14 points (Deming, 1986). A third was
based on the Juran Trilogy , which organizes the subject matter
into three fundamental processes: quality planning, quality control
and quality improvement.

A further development has been a growing feeling among industrial

companies that while quality has risen greatly in importance, the
educational system has not kept up with this trend. As a result,
school graduates lack knowledge of the subject, forcing companies
to fill the gap through training. Schools at all levels have begun
to address this problem. In addition, some companies have set up
alliances with selected schools to help redesign the curricula,
provide training materials, train faculty members and otherwise
support the alliance.

Measurement of quality
Measurement of quality at the technological level has been used for
many centuries. What is new is the need for measuring quality at
the business level measures of customer satisfaction, competitors'
quality, performance of key business processes and so on. To meet
such needs often requires inventing new measures as well as
creating related methods of analysis and presentation. The need for
measurement may also require development of a National Quality
Index to parallel the indexes already in use, such as those for
consumer prices, unemployment and productivity.

Human resources and quality: Empowerment

As of the early 1990s, many U.S. companies still retained the

separation of planning from execution inherent in the Taylor system
of scientific management. As a result, those companies failed to
make use of a huge underemployed asset the education, experience
and creativity of the work force. It is generally agreed that the
Taylor system is obsolete and should be replaced, but there is no
consensus on what should replace it.

Replacing the Taylor system requires transfer of tasks from

specialists and supervisors to nonsupervisory workers. The word
empowerment has become a label for such transfer. Empowerment takes
various forms, all of which have been undergoing test. The more
usual forms of empowerment have included the following: Establish
worker self-control. This requires providing workers with all the
essentials for doing good work: means of knowing what are the
quality goals; means of knowing what is the actual process
performance; and means for adjusting the process in the event that
quality does not conform to goals.

Because empowerment involves extensive transfer of work from

supervisors and specialists to the work force, it is meeting much
cultural resistance. There is also some resistance from labor
unions. They sense that empowerment establishes a new communication
link between management and the work force, which may weaken the
linkage between workers and the union.

In the view of the author, replacing the Taylor system is an idea

whose time has come. It is also his view that all of the above
options will grow and that the major successor to the Taylor system
will be self-directing teams of workers.

Motivation: Recognition and reward

Meeting the new competition in quality has required company

personnel to adapt to numerous changes, such as: Quality must
receive top priority. Personnel must accept training in various
quality-related disciplines. A new responsibility quality
improvement is added to the traditional list of responsibilities.
The use of teams requires personnel to learn how to behave as team
members. Generally, U.S. companies have recognized that for such
changes to be accepted, they must make revisions with respect to
motivation. The companies responded by increasing the use of
recognition and, to a lesser degree, by revising the reward
systems.

Recognition is public acknowledgment of superior performance. The

companies expanded their use of prizes, plaques, ceremonial
dinners, publicity and so on. Generally, they did this with skill
and in good taste.

While recognition relates to voluntary action, the reward system

relates to the mandated actions that define the job description.
Here the company responses were less sure-footed there was no
precedent on how to make the needed changes. Mostly the companies
expanded the list of parameters used annually to judge employee
performance by adding a new parameter such as "performance on
quality improvement." (Some companies even failed to realize that
they needed to change the reward system.)

Total quality management

As the quality crisis deepened during the last half of the 20th
century, more and more prerequisites were identified as essential
to achieving world-class quality. A need then arose for a short
label for this list of prerequisites. As of the 1990s, the most
popular label was the term total quality management, or TQM.

Although TQM became a popular label, there was no agreement on what

the essential elements of TQM are. One widely available,
comprehensive list was the criteria used by the National Institute
of Standards and Technology to evaluate applications for the
Baldrige Award. As of the early 1990s, that list became, in the
opinion of the author, the most complete available definition of
TQM.

Prognosis for the 21st century

Until the 1980s, the prognosis for the United States was gloomy.
Japanese companies had successfully invaded the U.S. market with
products that offered superior quality and value. The resulting
public perception then became a force in its own right, continuing
to damage those U.S. companies that had been slow to respond.

During the 1980s, the quality crisis deepened despite initiatives

taken by many companies. However, a small number of companies
distinguished themselves by raising their quality to world-class
levels. The results they achieved have been publicized. The methods
they used to get those results have also been publicized. The fact
that such results were achieved proved that world-class quality is
achievable within the U.S. culture. (If those companies did it, it
is doable.) The job ahead then became one of scaling up.

By the early 1990s, some powerful forces had converged to stimulate

scaling up. The growing quality crisis had raised awareness of the
subject, as did the growth of awards for quality, notably the
Baldrige Award. Self-assessment against the Baldrige criteria
helped many companies identify their strengths and weaknesses. The
publicized results achieved by the role-model companies stimulated
a desire to secure similar results. The publicized lessons learned
showed the way to get such results. The successful companies began
to shrink their supplier base, and a major criterion for supplier
survival was to attain world-class quality.

An additional powerful force is waiting to emerge the urge to "buy

American." Most Americans do prefer to buy American, all other
things being equal. During the 1960s and 1970s, other things were
not equal, so the urge to buy American was overcome by the superior
quality and value of Japanese products.

More recently, some U.S. companies have narrowed or eliminated the

gap between Japanese and U.S. quality. That action enabled those
companies to regain some of the market share they had lost. We can
expect the quality gap to continue to narrow in the coming century.
That will translate into growth in market share for U.S. companies
once customer perception catches up with the facts. Some of this
has happened already.

Of course, quality is a moving target, and competitors do not stand

still. But the trend remains clear. The revolution in quality will
persist into the next century. The 21st century has been the
Century of Productivity, but the 21st century will be the Century
of Quality.

In the view of the author, the United States is now well-poised to

become a world leader in quality during the next century.
 MGNT 1 – Operations Management and TQM
Activity 5
Instructions:
1. Write a reaction paper about The History of Managing for Quality in the United
States. (No need to copy the entire readings.)
2. No need to take a photo of your work. Keep the papers and it will be submitted
at school upon scheduled.
3. Copy the format provided.
Note:
Heading: Activity 5