Articles

1- "Hey, boys… there's another world out there!"

2- The path to Business Excellence: dificulties involved and how to overcome them

Manuel Iraolagoitia, former general manager of Microdeco, basque company prize in 2003th EQA Award.


"Hey, boys… there's another world out there!"

In 1995, I was lucky enough to be invited by Euskalit to visit UBISA, a company in Burgos which had been awarded the European Quality Prize three years before. After the management team had presented the company, it was left to one of the workers to explain how a mini-company in UBISA was managed. He spoke about PDCA cycles, 5S (which could have been a brand of washing powder for all I knew!), problem solving methods, the deployment of objectives…. in short, things I'd never heard of in my life.
At that point, I couldn't help but start thinking that perhaps that worker knew more about management than me. And, after looking around at the faces of the other 40 or so fellow general managers on that visit, it didn't take me long to realise that, indeed, he knew more than all of us!
When I returned to my company the next day, I brought the management team together and bravely announced to them, as Christopher Columbus had said many years before me: "Boys, there's another world out there!".

5S convinced the workers that we meant business

Solely on the basis of our conviction we were doing the right thing, we invested 5 million of the then Spanish pesetas on a pilot implementation of 5S. Just as that visit to UBISA had opened our eyes as managers, the implementation of 5S convinced our workers that we really meant business, and from then on they believed in us and began coming up with improvement ideas and suggestions.

Turning business recession into improved competitiveness

1993 was a crisis year for us, and job cutbacks and lay-offs were initially on the agenda. However, we eventually chose to work together to achieve ISO certification, and were the first company in our sector in Spain to be certified under ISO standards and the 92nd overall. 2000 also saw a drop in business orders, but we took advantage of this situation to train our people in various areas, especially in working with state-of-the-art production machinery.

You can't force the Unions into being your friends

Confrontation with Unions can be avoided by explaining things in a transparent, clear and coherent manner, i.e. either we increase productivity to be in a position to lower our prices and thus maintain jobs and perhaps even grow as a company, or sooner or later we'll be driven out of the market. You can't force the Unions into being your friends, but if they see what you say and do is coherent, they'll eventually start taking much more of an interest.

"The EQA Prize in the SME category is for a company of 92 people, and 125 of them are here with us in Helsinki" (Presenter at the EQA Award Ceremony in Helsinki, October 9, 2003).

The organisers of the Award Ceremony and gala dinner were amazed at seeing so many of us in Helsinki. Although it cost us a fortune to do it, we not only took all our people but also invited our main suppliers and customers. You can't go around saying "the company is all of us" and then limit a celebration like this to a chosen few.

I like my work to be recognised, just like everybody else

There have been many reasons for applying for recognition. I like to receive recognition, just like everybody else, and it's good when people come up to me and say things like "I saw you on TV the other day". But all that's secondary.

Our people know that, to date, few other companies are doing what we're doing, and when we were given the Basque Country "Silver Q for Quality" Award, and later the "Gold Q for Quality", their friends and families congratulated them. They could see and feel social recognition for our efforts. But beware: if you go in for an award taking it for granted that you're going to win it, and neither you nor your people are prepared for any other eventuality, it will take you a while to recover from the negative consequences this brings.

What's more, many of my customers use the EFQM model, and we, like them, have won prizes. One of our most important contracts at the moment has come through these channels.

Nowadays, I don't do even 20% of what I used to do 4 years ago

Before, my time was spent on day-to-day activities, troubleshooting. Now, 80% of my activities are new, and I can dedicate my time to planning and preparing the future of the company.

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Below is an extract from an interview with Mr. Jim Cricket, a voice of conscience with extensive working experience in the field of Quality and Business Excellence. With 20 years experience in a company of Excellenceville that was taken over by a multinational in the 1990s, Mr Cricket is currently responsible for Business Excellence for the whole of Europe, a post which has provided him with first-hand knowledge of the situation and experiences which the companies of his group have undergone on an international level. Mr. Cricket has been a member of the Euskalit Assessors Club for the last seven years.

The path to Business Excellence: dificulties involved and how to overcome them

¿What would you say are the major obstacles and difficulties that managers of organisations are likely to find on the path to Business Excellence?

The first difficulty to overcome is ignorance. All of us have an intuitive concept of what Quality and Excellence mean. We believe we already know enough about it, and top management especially are guilty of considering them as basically technical and operational matters to be dealt with by specialists in the production and quality departments. Only when a General Manager really understands that he/she, and not his/her collaborators, has maximum responsibility for what used to be called Total Quality Management or Total Quality, and now is referred to as Excellence, can we say that the first difficulty has been overcome. General Managers must have a clearer knowledge of the general concepts of the meaning of Excellence than anyone else in the organisation. There may be others with specialist knowledge of methodologies and specific tools, but it's the General Manager's responsibility to have a clear overall vision in this area.

The next obstacle is fear. Running an organisation is not a mathematical science, a world in which 2 plus 2 equals 4 at all times, in all places and in all circumstances. Running an organisation means operating within a climate of uncertainty. One and the same initiative may produce a positive result one time and a different result another, whilst investment in product development may prove highly beneficial at one moment and a money-losing experience the next.

We can calculate return on investment on machinery but how can this be calculated for internal communication, or for listening to our customers? What Excellence proposes is a complete overhaul of those values and codes of conduct which are deeply rooted in organisations, aware of the effort that this requires but also of the fact that there's no insurance company available to provide a safety net against failure. The capacity to take decisions and risks is an essential requirement for overcoming this obstacle.

To overcome these difficulties we must be well informed and appropriately trained. Benchmarking leading-edge organisations in the field of management (of which we are fortunate to have several in the Basque Country), looking at their results, speaking to their management team, taking away lessons learnt and transferring them to our organisations are all ways of doing this. There are also many courses on offer which explain the main concepts and methodologies involved and provide us with the opportunity to meet people in a similar situation to us.

There is also an extensive bibliography on the subject. Submission documents of those organisations which have been candidates for Excellence Awards are an especially good source of information on methodology, best practices and management results.

Frustration is another difficulty. As I mentioned before, some initiatives will work out, others won't, and you'll sometimes have the feeling of taking one step forwards and two steps back.

The way to overcome this is through perseverance. Positive results will eventually shine through, though this is an easier process to live through if we live it together with others, for example, taking part in "Training for Action Programmes", moving forward and learning with other organisations, setting ourselves common goals and supporting each other in times of difficulty.

The last obstacle is arrogance. Once you've obtained the results, and perhaps even been publicly recognised with one or more awards, there is always a risk of thinking that you now know it all, that you've crossed the finishing line and you're now in a position to teach others but there's nothing left for you to learn.

To overcome this obstacle, we must be modest enough to see the benefits of asking external experts to come into our organisation now and again to assess and provide us with new perspectives and opportunities for improvement. The fact is, the further you advance along this path, obtaining results and becoming aware of greater opportunities for improvement, the more rewarding the path towards Excellence becomes.

¿Don't you think there are perhaps too many awards and certificates available nowadays?

I think all Excellence Awards, Quality Certificates and other forms of recognition have a positive role to play as long as they meet certain conditions.

To begin with, they must be rigorous, awarded against clear and publicly transparent criteria by transparent awarding bodies which guarantee fairness and equality in matters of access to these different forms of recognition.

Secondly, an organisation must consider why it is applying for recognition. If the reason for requesting external assessment, an audit or for putting themselves forward as a candidate for an award is because the organisation believes that the opinions and suggestions of qualified people from outside the organisation will enable them to identify new opportunities for improvement, perfect! If, in doing so, the organisation receives recognition, even better! We all like to receive recognition; it encourages us to continue moving forward with renewed vigour.

The problems arise when we catch "compulsive prize winning-itis", a malignant virus which converts recognition into an end in itself instead of a consequence of progress, and begins to eat into our resources, time and enthusiasm. If we invested those same resources, time and enthusiasm in improving our management, we would obtain both improvement and recognition.