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cards to companies that can do it more cheaply. Large oil companies have outsourced the cleaning and maintenance of
refineries. Eastman Kodak outsourced its computer operations to IBM. Manufacturing companies have outsourced the
designing of new plants, and service organizations have outsourced mailrooms, warehousing, and delivery services.
Outsourcing has also become a viable option for city and state governments trying to slash costs and improve effi-
ciency. In Scotts-dale, Arizona, Rural/Metro Company contracts with the city to run fire departments and emergency
medical services and is able to provide better service at a fraction of the cost of traditional government-run services. As
with other quality systems, outsourcing is successful when care is taken in
selecting the operations that can be accom-
plished with greater quality elsewhere and in finding the best outsour-cing partners. The trend toward outsourcing is
widespread.
REDUCED CYCLE TIME. In the book Quality Alone Is Not Enough, the authors refer to cycle time as the
"drivers of improvement." Cycle time
25
refers to the steps taken to complete a company process, such as teaching a
class, publishing a textbook, or designing a new car. The simplification of work cycles, including the dropping of barri-
ers between work steps and among departments and the removal of worthless steps in the process, is what enables a
TQM program to succeed. Even if an organization decides not to use quality circles, substantial improvement is possi-
ble by focusing on improved responsiveness and acceleration of activities into a shorter time. Reduction in cycle time
improves overall company performance as well as quality.
For example, L. L. Bean, Inc., the Freeport, Maine, mail-order firm, is a recognized leader in cycle time control.
Workers have used flowcharts to track their movements and pinpoint wasted motions, shifting high volume merchan-
dise closer to the packing station. Improvements such as these have enabled L. L. Bean to respond with a correct ship-
ment rate of 99.9 percent within only a few hours after the order is received.
CONTINUOUS IMPROVEMENT. In North America, crash programs and grand designs have been the pre-
ferred method of innovation. Yet the finding from Japanese success is that continuous improvement produces an even
more effective result. Continuous improvement
26
is the implementation of a large number of small, incremental im-
provements in all areas of the organization on an ongoing basis. In a successful TQM program, all employees learn that
they are expected to contribute by initiating changes in their own job activities. The basic philosophy is that improving
things a little bit at a time, all the time, has the highest probability of success. Find one small way to improve the job
today and act on it. That improvement will suggest another useful piece tomorrow. No improvement is too small to im-
plement–activities are fine-tuned all the time. In this way, innovations can start simple, and employees can run with
their ideas. There is no end to the process. Improvements occur all the time, and the resulting changes give a company a
significant competitive advantage.
The continuous improvement concept applies to all departments, products, services, and activities throughout an or-
ganization. At South Carolina Baptist Hospital in Columbia, South Carolina, 2,500 employees have been trained in con-
tinuous improvement techniques. Managers learn a coaching role, empowering employees to recognize and act on their
contributions. Baptist has learned that countless improvements require a long-term approach to building quality into the
very fiber of the organization. Over time, project by project, human activity by human activity, quality through continuous
improvement has become the way the hospital's employees do their work.
T a s k 2. Listening comprehension: an interview with a management consultant about quality control.
Interviewer: Sarah Lockhart is the Quality Director of AP Management Consultants. Sarah, how is Quality with a
capital Q different from what's always been known as 'quality control'?
Ms Lockhart: The idea of Quality is a concept that is coming to be the driving force of many parts of industry to-
day. The interesting thing is that it can be applied to both the service sector and the manufacturing sector. We can talk
about Quality of manufacturing and quality of service. Quality is something that affects all the functions of the company
and all the staff from board level down to line managers and employees.
Interviewer: So how would this be applied to manufacturing?
Ms Lockhart: Well, the key idea here is 'Zero Defects' – the company should be aiming to produce goods that are
perfect. So that customers are entirely satisfied and they don't discover any faults at all after delivery has taken place.
Interviewer: Yes, but surely nobody's perfect. We all make mistakes sometimes.
Ms Lockhart: Well, yes, people make mistakes, but we believe that everybody wants to be perfect and they want
their product to be perfect and to have no defects.
Interviewer: Ah, I see.
Ms Lockhart: In the past it was considered impossible to mass-produce goods to a very high standard. There
would always be rejects and some faulty goods would inevitably get through to the customer, because carrying out a
quality control of every manufactured item would be too expensive and therefore unprofitable. Quality control usually
consisted of random checks – operating rather like Customs officers in the green channel at an airport. Customers came to
expect there’re to be some faults in the goods – and it was just a fact of life in manufacturing. Anything that was wrong
could always be put right later by complaining to the supplier and getting him to repair or replace the faulty goods.
25
Cycle time The steps taken to complete a company process.
26
Continuous improvement The implementation of a large number of small, incremental improvements in all areas of the or-
ganization on an ongoing basis.
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