Synopsis of Earlier Post...
Jorge Cuadros works in a family-owned Peruvian auto parts manufacturing
company that exports to Chile and Bolivia. The owner feels an urgent need
to adopt a new process of management so as to improve productivity and
reduce cost. These goals, in turn, are seen as making the company
competitive in the global market. A discussion amongst the managers of the
company focuses on whether to begin with a TQM or an ISO-9001 process.
Response...
Based on what I know at this point, my counsel is to postpone that decision
until some preliminary initiatives have been completed. One would focus on
examining the cost structure of the manufacturing operations; a second
would examine productivity, with particular emphasis on processes and their
performance; a third would entail studying the market (current and new
possibilities). One of the more important things to know is if any current
or future customers require ISO certification. If they do, then "doing"
ISO is a foregone conclusion--unless the owner wishes to forego those
markets.
My aims would be to work backward from the market study to tease out the
kinds of cost and productivity improvements that are necessary to
achieve/maintain competitive performance.
If I fail to do this kind of basic analytical groundwork, I will wind up
"doing" TQM or ISO (i.e., blindly implementing a programmatic course of
action without a clear understanding of the links between it and the
results I'm after). This, of course, runs the risk of changing nothing
except some small aspect of the management process at Jorge's company and,
conceivably, making matters worse instead of better.
I confess to being completely unfamiliar with Peruvian society and business
culture so I cannot give Jorge any specific counsel. However, in a similar
situation in this country, I would be inclined to say something like the
following to the owner:
"The choice between TQM and ISO is an extremely important one. The
stakes are very high. We must make that decision on the best informed
basis possible. Key pieces of relevant information include our
current
cost structure, productivity levels, and market-related factors (in
particular, an analysis of the requirements we must meet if we are to
compete successfully). This kind of information will guide our
decision. The lack of it makes choosing between the two almost a
matter of tossing a coin. "Betting the company" is something that
happens from time to time but surely the odds ought to be better
than 50-50. Give me a couple of months to collect and analyze this
kind of information and then let's make the call."
Fred Nickols, Executive Director
Strategic Planning & Management Services
Educational Testing Service [01-D]
Princeton, NJ 08541
Tel = 609.734.5077 Fax = 609.734.5590
e-mail =
fnickols@ets.org
Views expressed are the author's, not ETS's.