Executive Management and Quality

Executive management is the highest level of management in the organization. In smaller companies it may be the owner, or an appointed factory manager, and so on. In large organizations it could be the top level of management, or the board of directors. In small companies the line between executive and middle management is often not clear, e.g. the owner is also the general manager, the production manager, the quality manager, and so on. He or she is often responsible for all the activities of the company, including the quality function.

In larger organizations we often find an appointed quality manager, who may also have other functions or positions at the same time. In corporates we may find corporate, divisional and factory quality managers, as the case may be.

In ISO 9001:2015 we find that there is no longer a requirement for an appointed management quality representative. Executive or top management as a team is accountable and responsible for the quality of products and services. This does not mean that the position of quality manager has become obsolete though. Companies still appoint or task a person with this responsibility.

What we are seeing is that, because products, processes and procedures are becoming more and more complex, the functions of planning and execution are becoming more separated, especially in larger organizations. Trained planners look after the planning functions, while operations execute the plans. Of course, in smaller companies this separation is not so clear.

This separation of planning and execution has led to a few important consequences:

• Craftsmen are no longer “responsible” for the quality of their work and products, although there has of late been a huge drive to ensure that they are able to control the quality of their work and products.
• Productivity demands are rising at an alarming rate.
• Quality is being managed between the operational units, quality on the one hand, and production on the other, with a few other functions having roles to play as well.
• Executive management is becoming more and more removed from the task of managing quality directly, especially in larger organizations. 

This can have a serious negative effect on the quality of products and services. To counter these effects, we put a quality organization in place (see previous blog – Organizing for Quality).

It is a fact that in the Western world many companies were able to remain competitive despite these problems. It could have something to do with the fact that everybody experienced the same problems. But during the 1950s everything started to change. Japan entered the scene and immediately upset the equilibrium. They brought two new forces into play:

• The impact of quality on society.
• Japan posed a direct threat by establishing a new level of competition, based on superior quality.

What Japan did had a serious impact on many organizations. At first companies tries to use negative propaganda to counter the Japanese threat, and soon many people in the Western world were talking about “Jap-Scrap” to show how inferior the Japanese products were. This did not last very long, because it was not true, and consumers quickly realized this. Japanese products were suddenly in very high demand, based on superior quality and lower cost (lower cost is based on superior quality of the associated processes and procedures). Executive management in Western companies realized that they had to revisit the basics of quality. This started to happen extensively during the 1980s. Companies during this time started to extensively implement systems like Statistical Quality Control, Statistical Process Control, Lean Manufacturing (from Japan), Total Quality Management, etc.

One of the problems that became abundantly clear was that the belief that quality could simply be delegated to the lower levels of the organization was flawed. More so because, once delegated, executive management believed that they did not need to worry about quality anymore. It was found that two things were required:

• A comprehensive company-wide approach to managing quality
• Extensive participation by executive or top management

If we look at the more successful companies today, we see that they have enlisted the personal participation of executive managers in the quality function.

ISO 9001 also required, from when the first version of the standard was published in 1987, management to be committed to quality management in the organization. This requirement has become more pronounced in later versions of the standard, and never as much as in the 2015 version.

Participation by executive management

A lot of people are, quite rightly, talking about management commitment and involvement in the management of quality in organizations. But this is fairly meaningless, because these are broad terms which do not mean much in themselves. We need to clarify which decisions should be made by executive management and which actions they should be taking.

If we broadly summarize the responsibilities of executive or top management, we come up with the following:

• Establish company policies
• Set quality objectives
• Deploy these objectives
• Provide the necessary resources for the objectives to be achieved
• Provide problem solving orientated training
• Serve on quality improvement teams
• Review progress
• Stimulate improvement
• Give recognition where it is due

An uncomfortable truth is that there will always be some resistance from members of management, including executive management, to this participation. Some members of management may opt for selective participation.

Executive management can, through leadership actions, create an environment where people can be fully involved and in which a quality management system can be effective. This has been proven many times over.

ISO 9001:2015 talks about Leadership in the organization, and not only about top management as in the older versions of the standard, which had requirements for management responsibility. The term “leadership” implies that executive (and other) managers are moving the company forward as far as quality management and the quality of products and services are concerned. The nett effect Is that the company will perform better financially, and will be economically sustainable (note that they also have to attend to social and environmental sustainability to make the company sustainable in the long term). Their actions and participation are also required to be based on risks and opportunities, through the application of risk-based-thinking (RBT), which considers external and internal issues pertaining to the organization. The quality of products and services is one of these issues.

In clause 5.1 Leadership and commitment of ISO 9001:2015 we read the following in clause 5.1.1, General:

Top management shall demonstrate leadership and commitment with respect to the quality management system by:

a) taking accountability for the effectiveness of the quality management system;
b) ensuring that the quality policy and quality objectives are established for the quality management system and are compatible with the context and strategic direction of the organization;
c) ensuring the integration of the quality management system requirements into the organization’s business processes;
d) promoting the use of the process approach and risk-based thinking;
e) ensuring that the resources needed for the quality management system are available;
f) communicating the importance of effective quality management and of conforming to the quality management system requirements;
g) ensuring that the quality management system achieves its intended results;
h) engaging, directing and supporting persons to contribute to the effectiveness of the quality management system;
i) promoting improvement;
j) supporting other relevant management roles to demonstrate their leadership as it applies to their areas of responsibility

A further requirement for executive management is found in Clause 9.3, Management review. A few important topics for review are (not the complete list):

• Customer satisfaction
• Process performance and conformity of products and services
• Opportunities for improvement

The outputs for these management reviews include:

• Opportunities for improvement
• Any needs for changes to the quality management system
• Resource needs

Executive management is thus responsible to ensure that there is a focus on customer requirements (the customer is the ultimate judge of the quality of the organization’s outputs) throughout the organization, and that the appropriate processes and procedures are implemented to ensure that the requirement of customers and other interested parties are met consistently, and that quality objectives are achieved.

The review function to review the performance of the quality management system, including the delivery of quality products and services in the most effective and efficient manner (to cut costs) is vitally important. As such, successful organizations conduct regular management reviews, not just one per year only because the standard requires that reviews must be conducted. They take these reviews seriously.

Quality management is about managing quality in the organization. It is therefore impossible for executive management not to be involved.

I trust that this information is useful to leaders in organizations, and that executive managers, business owners, and other managers will realize that their involvement in quality is absolutely critical.

Feel free to let me know your thoughts in the comment section, or by sending me an e-mail at koosgouws10@gmail.com. Questions and enquiries are also welcome. Visit our website at www.sheqmanagementsystem.co.za, or alternatively at www.sheq-management-systems.webnode.com

Regards

Koos