Quality Management How Important Is the Concept

Quality Management

How Important is the Concept of Quality in Strategy Formulation?

Companies, products and brands rise and fall on the quality of each successive product generation or new service being offered to businesses or consumers. Quality is so significant of a factor in the success of companies that studies suggest that it is a critically important catalyst for successful innovating one product generation to the next (Nowak, 1997). Product quality is increasingly the only differentiator in increasingly commoditized, undifferentiated markets as well (Frankforter, 1998). Due to all of these factors, strategic quality management encompassing Total Quality Management (TQM) is now an integral part of strategy formulation in many industries (Calingo, 1996).

Analysis of Quality in Strategy Formulation

The integration of quality management at an enterprise level of strategy planning often is a recursive process, where a company literally "leans" how to make quality part of its culture (Calingo, 1996). Quality is never a one-and-done proposition; in fact it must be continually fine-tuned and measured to evaluate its contribution to strategic planning, initiatives and results.

The greatest contributions that quality management has made to strategy formulation is infusing each decision with the voice of the customer and their specific needs via Six Sigma and TQM frameworks. The continued growth of quality in strategy formulation is also predicated on the inherent cost advantages of doing this. Greater quality levels will drive lower production, operations and services costs by significantly reducing overall costs (Pruett, Thomas, 1996). By paying attention to quality companies also can begin to completely redefine their organizational development and new product introduction processes as well, often increasing their speed and profitability (Frankforter, 1998).

Quality then becomes an accelerator of continued organizational improvement. It becomes a catalyst of continued improvement as is inherent in the TQM framework and comparable ones like it (Calingo, 1996). The continual evolution of strategic planning and execution is also taking into account quality more than ever due to compliance requirements of state, local, federal and global agencies across regulated and unregulated industries (Johannsen, 1996). What emerges from the iterative nature of quality management being integrated into strategy planning and implementation are maturity models that indicate relative level of quality program goal attainment. At the highest levels of quality management maturity within a strategic planning process, the culture of a given firm has engrained the values and techniques into all core business processes (Calingo, 1996). Aside from the cost benefits and continued improvement in process performance, this approach also ensures a company will have a strong foundation for future growth as well. All of these factors contribute to greater agility and resilience in turbulent economic times.