Managing quality fads

Recently I've been reading a book about the history of our field, Robert E. Cole's study, Managing Quality Fads: How American Business Learned to Play the Quality Game. The book came out in 1999, so whenever Cole talks about "current practice in industry today" I had to remind myself to reset my mental frame by a quarter century. But mostly the book is a history. Cole examines the period when American manufacturers learned to rethink their approach to the Quality discipline, in the face of strong and successful competition from Japan. He starts his story in the early-to-mid-1970's, when American manufacturers first began to face serious competition from Japanese firms offering superior product quality. Then he brings it up to "the present day" (1999), by which time the awareness of Quality had become normalized in American industry and American manufacturers—some, at least—could once again compete with their Japanese counterparts on a level playing field. It's a big story, with a lot of moving parts. And ultimately Cole organizes his material to address one large, overarching question: How do organizations learn?     

The book is not one to read quickly. Cole writes for an academic audience more than for a business one, and there is a lot of detail. Often it seems that Cole is telling us everything he knows about a topic, even when he could make his point more clearly by saying less. And there are many places where he describes a Quality initiative in a certain company, only to start the next paragraph by saying (in effect), "Of course there were other people in the same company doing the exact opposite." It takes him a long time to paint the full picture.

In one sense, though, Cole's presentation is relentlessly true to the facts where a clearer storyline would distort them. When American firms were first successfully challenged by Japanese companies that reliably produced higher quality products, they didn't know what hit them! Cole makes it clear that the American manufacturers didn't understand what made the Japanese products better—and not only did they not know how to improve their own operations, but they didn't even know what "improve­ment" might mean. Cole's slow, methodical "on the one hand ... but on the other hand" exposition can be frustrating if you want answers: What finally worked? How do organizations learn? But the players at the time felt that same frustration too. There were a lot of false starts, a lot of "quick-fixes" that went nowhere, and a lot of confusion all around. Cole's very deliberate approach to his story helps the reader to feel that, and to appreciate it in retrospect.

The other advantage to Cole's presentation is that it is rich in detail. There are a lot of little nuggets that are worth exploring for their own sakes. Over the next few weeks I plan to pull out some of these nuggets and write about them. Oh, I'll write about other things too. But I expect to come back to this book several times in the blog, before I finally put it back on the shelf. There is a lot here.

For today's post, I'll limit myself to summarizing Cole's final conclusion, in an abbreviated form. (I can write another post later with more detail, if there's interest.) Cole introduces the last section of his last chapter in a way that feels distinctly unpromising:

[The] question is often posed: how do managers learn to identify best practices and diffuse them across an organization? Survey data suggest the answer is, not very well.*   

But then he describes the approach which, in the long run, seemed to be the most productive. He focuses his results in two ways. 

• First, his attention is on large organizations with many divisions: partly, no doubt, because those are the companies he got to know through his consulting practice; but also, I think, because those present the most difficult case for organizational learning. The size of such companies means that any organizational transformation has to be adopted by many people; since the number of affected individuals is large, progress is necessarily slow and the institutional inertia is enormous.
• Second, he is writing specifically about how large corporations learn "under conditions of uncertainty and incomplete information"**—exactly the conditions that characterized the Quality challenge from Japan. 

In that context, Cole identifies the most robust approach to be a collaboration between a central function at headquarters and implementation in the "periphery" (i.e., the operating divisions).

• The central function sets high-level goals, targets and incentives, but does not specify exactly how they should be implemented. This is because the prevailing "uncertainty and incomplete information" mean that headquarters doesn't really know how they should be implemented!
• The operating divisions figure out methods that work for them. Since they are the ones who actually do the work, they will have a much better understanding than headquarters does of what methods are practical and what are not.
• But then the central function monitors the innovations and the results, "to identify, synthesize, and diffuse best practices; otherwise the mutation process [i.e., local innovations in the operating divisions] will lead to dilution and degeneration."***

During the twenty or thirty years when American companies were relearning how to think about Quality, there were many different approaches. But this one seems to have been the most robust, involving shared responsibility across the organization: with central guidance and local adaptation. 

In fact, Cole argues that the same center-and-periphery topology describes how Quality knowledge spread across the country as a whole, from early-adopting industries even to those that were more protected from the challenge. But that, as they say, is another story. 

__________

* Emphasis mine. The quote is from Robert E. Cole, Managing Quality Fads: How American Business Learned to Play the Quality Game (New York, Oxford: Oxfor University Press, 1999), p. 243. 

** Ibid., p. 246. 

*** Ibid., pp. 245-246.