Are Quality Circles Effective? An Organizational Behavior Review

Introduction

According to research, more than 50% of the general population believes that American workers are not as productive as they could be — a view supported across the labor force, where three-quarters of workers admit they are not realizing their full potential at work (Yankelovich and Associates, 1983: 6–7; Bowman, 1989). As a result, organizations have set out to improve the quality of work life and production. One mechanism that companies are investing in to achieve this goal is quality circle programs. Considerable controversy exists, however, as to whether or not quality circles are truly effective.

Quality circles have been around for a long time. Having survived economic recessions and cutback management, many corporate leaders still believe that quality circles are the key to solving quality management issues (Business Week, 1982; Pascarella, 1984; Bowman, 1989). Among the issues that quality circles address are increased demands for services in the face of fiscal uncertainty (Bowman, 1989; Jarrett, 1985).

This paper examines the following question: are quality circles effective mechanisms in organizations? Proponents of quality circles have long cited their reported benefits; often defined as team-oriented work performance groups, quality circles were envisioned as a tool that organizations could use to enhance worker productivity, motivation, and performance. Detractors, however, have argued that quality circles are more "quick-fix schemes" adopted by hurried managers seeking short-term solutions to long-standing corporate problems. There are many organizations that have claimed great success using quality circles; yet studies suggest that in a large majority of companies that have implemented them, the failure rate exceeds 50%. This paper aims to ascertain whether quality circles are truly beneficial or wasteful in organizational settings.

Literature Review

To understand quality circles, one must first define the concept. Quality circles may be described as "small, voluntary, homogenous, problem-solving employee groups" (Bowman, 1989). They are generally regarded as a premier strategy for "mobilizing human talent to enhance competitive performance" (Bowman, 1989).

Government agencies represent one prominent example of organizations utilizing quality circles as a strategic mechanism. There are currently more than 2,500 quality circles operating within federal agencies and in state projects in Missouri, California, and Florida (Bowman, 1989; International Association of Quality Circles, 1984; Dawson, 1983).

Not all practitioners view quality circles favorably. This is true even in Japan, where firms that have used quality circles have in some cases found them ineffective (Bowman, 1989; Cole, 1980: 3). Reported instances of both successes and failures exist in the United States as well (Bowman, 1989; Business Week, 1982; Smeltzer and Kedia, 1985: 31). A more comprehensive examination is therefore necessary to assess whether quality circles should be continued from an organizational perspective.

Quality circles involve a small group of people performing similar functions who meet regularly to analyze problems, develop solutions, and make recommendations for continuous improvement. Based on the concept of group dynamics and worker participation, quality circles have been advocated as an effective way not only to boost productivity and quality, but also to foster a team-oriented corporate culture (Bowman, 1989).

Three core objectives of quality circles have been identified: (1) task improvement leading to a better work process; (2) employee development "based on training"; and (3) team building through "participative problem solving" (Bowman, 1989; Blair and Whitehead, 1984: 20). For quality circles to succeed, organizations must be trained to integrate them over extended periods of time, rather than treating them as temporary interventions.

More organizations than not implement programs of "crisis control," seeking short-term solutions rather than developing strategic programs oriented toward future excellence (Bowman, 1989; Hayes and Abernathy, 1981). Quality circles are sometimes associated with these "quick fixes," where organizational leaders seek out "promising new techniques" to alleviate corporate problems (Bowman, 1989). In such environments, quality circles may provide short-term relief but will yield disappointing long-term outcomes if they are not consistently developed and incorporated into the overall organizational structure.

Successful implementation of quality circles often also requires "a change in organizational philosophy" (Bowman, 1989). Work conditions at the outset may not be compatible with quality circle implementation; management must take an active role in restructuring those conditions. Over time, quality circles must also develop values consistent with those of management in order to ensure compatibility with the broader organization (Bowman, 1989).

Blue Cross of Washington and Alaska reported more efficient employee procedures following quality circle implementation, including a savings of $430,000 over a three-year period. Hertz Rent a Car in Oklahoma City also reported increased car availability resulting from innovations developed through such circles (Marks, 1986). Management experts remain skeptical of these claims, however, arguing that "QCs more often fail than they work" (Marks, 1986). Detractors contend that in most situations the technique yields only short-term benefits and does not truly address problems of poor productivity and employee morale (Marks, 1986). Typically, discussions within quality circles are limited to the quantity and quality of work — topics such as paperwork and material waste, machine maintenance, and inter-departmental cooperation (Marks, 1986).

Proponents maintain that quality circles can work on an extended basis. Sociologist Robert Cole of the University of Michigan noted that "by increasing employee participation in workplace decisions, increasing job variety, and making more effective use of worker potential," quality of work life and organizational efficiency would be significantly enhanced (Marks, 1986; Cole, 1980). Proponents have also suggested that one reason quality circles fail is that managers too often rely on easy-to-implement packages to launch them, but then fail to nurture them adequately (Marks, 1986).

Quality circles reached their peak during the mid-1980s, when studies suggested that more than 90% of Fortune 500 companies had incorporated them into their organizational structures (Li-Ping Tang et al., 1993). During the 1990s, a survey of Fortune 1,000 companies showed a smaller but still noteworthy increase in utilization (Li-Ping Tang et al., 1993). Despite these statistics, quality circle programs in the U.S. have failed in more than 60% of implementing companies (Li-Ping Tang et al., 1993). This finding suggests that a more thorough analysis of implementation strategy and program longevity is needed.

Lawler and Mohrman (1985) identified several phases and variables that could lead to quality circle failure, including low participation rates in voluntary circles, resistance from staff groups and middle management, prohibited costs, and benefits and savings not actually realized (Lawler and Mohrman, 1992; Li-Ping Tang, 1993). One study found that a frequently cited reason for employees' lack of participation was the perception that "QCs do not accomplish much" (Li-Ping Tang, 1993; Dean, 1985).

Quality circles are also closely linked to the idea of Total Quality Management (TQM), which was likewise popularized in the mid-1980s (Giroux and Landry, 1998). TQM has its own proponents and detractors. Quality circles can help firmly establish a successful TQM program within an organization when utilized correctly. However, in contemporary organizational management, considerable "confusion" still surrounds the exact definitions and perspectives on quality management, including quality circles (Wilkinson and Wilmott, 1995; Giroux and Landry, 1998). According to Dean and Bowen, the definition of quality "remains a hazy and ambiguous concept" (Giroux and Landry, 1998). Evaluators of quality circle programs traditionally emphasize qualitative and human aspects rather than proposed technical improvements (Hill, 1995; Giroux and Landry, 1998).

The term quality circles is often used interchangeably with continuous improvement teams and similar expressions (Giroux and Landry, 1998). Failure among such circles is frequently attributed to a lack of adequate management commitment and insufficient rigor during implementation, both of which can undermine corporate cultural integration of these programs (Ahire, 1996; Giroux and Landry, 1998).

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