Quality Management Frameworks

Besides previously discussed Quality Management Systems (QMS),  there are also Quality Management Frameworks (QMF) which aim to provide  guidance. Companies can use these frameworks to benchmark the  performance of their QMS, and can use the guidance of QMF to strive for  excellence. In this section I present four most recognized QMFs according to Hill and Hill (2011), and Graeme (2011):  ISO 9000 family of standards, The Deming Prize, The Malcolm Baldrige  National Quality Award and The European Foundation for Quality  Management Excellence Award. Table 1 below provides overview of the aims  of aforementioned QMFs.

Table 1: Overview of aims of Quality Management Frameworks

ISO 9000 family of standards

ISO stands for International Organization for Standardization. ISO 9000 “Quality Management” family of standards is developed and maintained by ISO technical committee ISO/TC 176 “Quality management and quality assurance”,  and aims to provide standardized guidelines for design and deployment  of QMS. Historical development of the standard is given in Table 2.  Table 3 lists standards from ISO/TC 176 and its subcommittees.

Table 2: Historical development of ISO 9000 family of standards

Table 3: Current standards from ISO/TC 176 and its subcommittees

ISO 9000 proposes the use of process approach to achieve continual  improvement (Figures 1 and 2) as well as seven Quality Management  Principles (ISO, 2015):

1. Customer focus
2. Leadership
3. Engagement of people
4. Process approach
5. Improvement
6. Evidence-based decision making
7. Relationship management

In addition, ISO/TC 176 (2009) proposes seven steps for successful implementation of QMS:

1. Engagement of top management
2. Identify key processes and the interactions needed to meet quality objectives
3. Implement and manage the QMS and its processes (using process management techniques)
4. Build your ISO 9001-based QMS
5. Implement the system, train company staff and verify effective operation of your processes
6. Manage your QMS
7. If necessary, seek third party certification/registration of the QMS or alternatively, issue a self-declaration of conformity

According to ISO (2010) and ISO (2015),   1109905 certificates for ISO 9001 had been issued in 2010, and 1033936  in 2015. Certification is not performed by ISO. Yet, the usefulness of  ISO 9000 family of standards is often questioned and criticised.  Proponents argue that organizations with ISO 9000 certificate achieve  better financial results (Heras et al., 2002; Corbett et al., 2005; Sharma, 2005), operational performance (Naveh and Marcus, 2007; Lo et al., 2009), stock market performance (Rajan and Tamimi, 2003), market performance (Buttle, 1997) and a number of internal benefits (Alcorn, 1995). Based on the aforementioned works, benefits of implementing ISO 9000 could be summed to the following:

• standards as a communication tool, both internal and external,
• increased profit margins,
• optimisation of operations and processes,
• enhanced image and marketing,
• empowered and motivated workforce, and
• better customer satisfaction.

It should be noted that direct causation between listed benefits and ISO 9001:2008 certification hasn’t been proven (Corbett et al., 2005). Opponents argue that ISO 9000 family focuses on procedures and control instead of improvement and understanding (Seddon, 2000), requires large amount of paperwork which results in increased administrative workload (Seddon, 2000), and does not cover the passion required to deliver the excellence (Peters and Waterman, 2006).  Further criticism is that ISO 9001:2008 certificate does not guarantee  good product or service and that benefits of applying the quality  approach are unrelated to the certification (Dalgleish, 2005). Heras et al. (2011) find that “no significant relationship was definitively identified  between the use of quality tools and an increase in a company’s  performance when it based its quality system on the ISO 9001:2000  standard”. Furthermore, some requirements directly contradict the teachings of quality gurus.

Most recent issue of the standard ISO 9001 (2015) has stirred a lot  of controversy and confusion, especially with so-called Risk Based  Thinking. Christopher Paris of Oxebridge has written a number of useful articles:

• Exploding the Myths of ISO 9001:2015
• ISO 9001:2015 Won’t Require a Quality Manual — Here’s What to Replace it With
• Practical Implementation of “Risk Based Thinking” – Part 1
• Practical Implementation of “Risk Based Thinking” – Part 2

The Deming Prize

The Deming Prize was created by the Union of Japanese Scientists and Engineers (JUSE) as  appreciation to contribution of Edward Deming. Its aim is to promote  excellence in Japanese businesses. The categories of the Deming Prize (Table 4) are the Deming Prize for Individuals, the  Deming Prize, and the Deming Grand Prize. Applicants are examined on  basis of the following viewpoints:

1. Reflecting its management principles, type of industry, business  scope, and business environment, the applicant has established  challenging and customer-oriented business objectives and strategies  under its clear management leadership.
2. TQM has been implemented properly to achieve business objectives and strategies as mentioned Item 1 above.
3. As an outcome of Item 2, the outstanding results have been obtained for business objectives and strategies as stated in Item 1.

Table 4: Categories of the Deming Prize

JUSE lists the following five effects of the Deming Prize:

1. New product development and launch will be promoted
2. New technology can be obtained
3. Sales target will be achieved continuously
4. Become capable of following a policy and fulfilling an objective
5. Organization’s functionality will be enhanced

Deming Prize is an efficient way of benchmarking and steering your  TQM system. JUSE publishes summaries of prize winners, allowing you to  benchmark yourself against the pioneers of quality:

• 2013 Deming Grand Prize and Deming Prize Winners Presentation Summary
• 2014 Deming Prize Winners Presentation Summary
• 2015 Deming Prize Winners Presentation Summary
• 2016 Deming Prize Winners Presentation Summary

The Malcolm Baldrige National Quality Award

The Malcolm Baldrige National Quality Award (MBNQA) was created by the United States congress and was named after Malcolm Baldrige. It is administered by the National Institute of Standards and Technology (NIST), and aims to improve the performance of U.S. businesses by  identifying and recognizing role-model businesses, establishing criteria  for evaluating improvement efforts and disseminating and sharing best  practices. The award focuses on performance in five key areas: product  and process outcomes, customer outcomes, workforce outcomes, leadership  and governance outcomes, and financial and market outcomes.

In addition to the MBNQA, NIST also promotes Baldrige Excellence Framework, a “systems approach to improving your organization’s approach” for Business / Nonprofit, Education, and Health Care sectors. Baldrige Criteria for Performance Excellence are depicted in Figure 4, while the role of core value and concepts is  depicted in Figure 5. You can read more about aforementioned criteria in  available commentary.

The European Foundation for Quality Management Excellence Award

European Foundation for Quality Management (EFQM) was founded in 1988 with aim to promote TQM approach and improve  performance in European businesses. European Quality Award was launched  in 1991, and was later renamed to EFQM Excellence Award. Companies are  assessed on the basis of nine aspects: leadership; people; strategy;  partnership and resources; processes, products and services; people  results; customer results; society results; business results.

The EFQM Excellence Model is proposed as framework for achieving excellence. It is envisioned as  non-prescriptive holistic framework and is comprised of three integrated  components: The Fundamental Concepts of Excellence (Figure 6), The Criteria (Figure 7) and The RADAR (Figure 8). Concise description of aforementioned components is given  in Table 5. Model is reviewed and updated in 3 year cycles.

Improvements in the organizational results are expected after successful adoption of holistic model like EFQM model (Hendricks and Singhal, 1996).  Recent studies have shown that in companies which use EFQM model,  quality-improvement tools have a high effect on performance (Heras et al., 2011), while also contributing to the development of an integrative strategy formation process (Taboada et al., 2011).

Table 5: Elements of the EFQM Excellence Model

Closing remarks

In previous blog posts I covered what is quality and why is it important to manage it, some of the most important quality philosophers, and presented six different Quality Management Systems. As Aristotle said,  excellence is a matter of habit. In this post I presented four well  known Quality Management Frameworks. ISO 9001 is the most well known of  these four, but has encountered increasing problems in last years, from  numerous certificate mills to bad management.

Your QMS should support your efforts to deliver great value to your  customers without sacrificing the well-being of your own employees.  QMFs, like excellence awards, can be a great way to benchmark yourself  against the best in the field. QMSs and QMFs don’t exclude each other,  but rather complement each other. In today’s ultra-competitive world it  is important to use every advantage you can.

References

Alcorn, J. E. 1995. The Benefits of ISO 9000 Certification,  in A Collection of Papers Presented at the 55th Conference on Glass  Problems: Ceramic Engineering and Science Proceedings, Volume 16, Issue 2  (ed J. B. Wachtman), John Wiley & Sons, Inc.

Buttle, F., 1997. ISO 9000: marketing motivations and benefits. International journal of quality & reliability management, 14(9), pp.936-947.

Corbett, C.J., Montes-Sancho, M.J. and Kirsch, D.A., 2005. The financial impact of ISO 9000 certification in the United States: An empirical analysis. Management science, 51(7), pp.1046-1059.

Dalgleish, S. 2005. Probing the Limits: ISO 9001 Proves Ineffective. Quality Magazine.

Graeme, K., 2011. Quality Management. Ventus Publishing.

Hendricks, K.B. and Singhal, V.R., 1996. Quality awards and the market value of the firm: An empirical investigation. Management science, 42(3), pp.415-436.

Heras, I., Dick, G.P. and Casadesus, M., 2002. ISO 9000 registration’s impact on sales and profitability: A longitudinal analysis of performance before and after accreditation. International Journal of Quality & Reliability Management, 19(6), pp.774-791.

Heras, I., Marimon, F. and Casadesús, M., 2011. Impact of quality improvement tools on the performance of firms using different quality management systems. Innovar, 21(42), pp.161-174.

Hill, A. and Hill, T., 2011. Essential Operations Management. Palgrave Macmillan.

ISO, 2010. ISO 9001 survey. ISO.

ISO, 2015. Quality Management Principles.  ISO.

ISO, 2015. The ISO Survey of Management System Standard Certifications 2015. ISO.

ISO/TC 176, 2009. Selection and use of the ISO 9000 family of standards.  ISO.

Lo, C.K., Yeung, A.C. and Cheng, T.E., 2009. Impact of ISO 9000 on time-based performance: an event study. Int J Humanit Soc Sci, 1, pp.35-40.

Naveh, E. and Marcus, A., 2007. Financial performance, ISO 9000 standard and safe driving practices effects on accident rate in the US motor carrier industry. Accident Analysis & Prevention, 39(4), pp.731-742.

Peters, T. and Waterman, R. 2006. In search of excellence : Lessons from America’s best-run companies. HarperBusiness Essentials.

Rajan, M. and Tamimi, N., 2003. Payoff to ISO 9000 registration. The Journal of Investing, 12(1), pp.71-77.

Seddon, J. 2000. The case against ISO 9000. Oak Tree Press.

Sharma, D.S., 2005. The association between ISO 9000 certification and financial performance. The international journal of accounting, 40(2), pp.151-172.

Taboada, L.R., Giner, M.T.C. and Benavent, F.B., 2011. Quality  tools and techniques, EFQM experience and strategy formation. Is there  any relationship? The particular case of Spanish service firms. Innovar: revista de ciencias administrativas y sociales, 21(42), pp.25-40.

This article is a part of Quality Management series:

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Quality Management Systems

Comparison of Japanese Total Quality Control, Total Quality Management, Deming’s System of Profound Knowledge, Lean, Business Process Reengineering, and Six Sigma.

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Quality Management Frameworks

Organisations can use quality management frameworks to benchmark the quality performance on their journey to excellence.

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On Continuous Improvement

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