Total Quality Management: Is it still relevant in a digital economy

Richard de Kock: 0:17

A big, warm welcome to the search for clarity, the Digital Strategy and Management Podcast. I'm your host, richard de Kock, and today we're going to be focused on total quality management and its relevance in a digital world. Customers today are primarily engaging with organizations through the services they offer via digital means, such as applications and websites, the smart apps on your phone, on your tablet, even on your TV. If you're going to open a bank account, you're going to do it via a smart app on your phone, maybe you'll do it on a website. If you're going to order groceries, you're going to do it via a smart app on your phone or on a website. And these platforms are what are shaping the experiences for customers and consumers today. I mean, let's face it, we're spoiled for choice, and switching providers is really simple to do. One slight slip up on service quality may mean the loss of a customer forever. So how are organizations going to compete effectively in a place like this? Total quality management as a discipline dates back to the early 1900s, and it was developed to address this very issue how to increase customer experience and make sure that you're able to retain your customers. Many would argue today that the concepts of total quality management are dated and the application of them not agile enough for us to use in a modern, digitally competitive world. So it is with great excitement for me to announce that today we are getting the incredible opportunity to speak to John Oakland.

Richard de Kock: 1:46

Listed as one of the 10 quality management gurus of our time alongside the likes of Edward Deming, Juran, Ishikawa and Crosby, John brings with himself credentials and experiences some of us could only dream of achieving in our lifetime. He was the first professor of total quality management from 1987 to 1996 at Bradford School of Management, where he created the European Center for Total Quality Management. His current academic position is Emeritus Professor of Quality Management and Business Excellence at Leeds University Business School. He is a fellow of the Royal Statistical Society and fellow of the Chartered Quality Institute and a Chartered Quality Practitioner. He established the Oakland Group and the Oakland Institute for Business Research and Education and is still an acting chairman for both. The Oakland Group was formed 35 years ago, in 1985, and it has helped some of the largest and most complex organizations in the world improve their performance. Based on those credentials, I think you can agree that we've got one of the best people to talk to us today about how total quality management is still completely relevant, even amidst emerging disciplines like DevOps, customer experience management, digital transformation, and in many ways, john's going to really turn things on their head and bring us back to reality and where we should be drawing our focus and attention going forward.

Richard de Kock: 3:12

So I really hope you enjoy this episode as much as I have. Before we begin, though, it's important for me to let you know that I'm a full-time Microsoft employee and that this podcast is independent and it is no way associated with Microsoft. The thoughts and ideas shared by myself and all my guests on the search for clarity are our own and in no way associated to Microsoft's business services or practices, and with that, let's find us some clarity. So, john, welcome, and thank you so much for giving us your time to share your knowledge and your expertise with us. Today, I saw in a recently published article you had on LinkedIn that you had been listed in a book called Quality from John Beckford and that you were listed amongst famous gurus such as Edward Deming and Juran and Crosby, etc. You'd also mentioned that you were the last one of them that was alive today. I'm the last one alive, yeah, and you said that most of them live to 93 or 100 and this is the reason why you like to be in the quality business, the long lifespan.

John Oakland: 4:15

So did you.

Richard de Kock: 4:17

So something that I've been wondering is have you ever actually met with any of the other gurus in your lifetime?

John Oakland: 4:23

Yeah, yeah, I was back in the late 80s, possibly early 90s. There was a massive TQM in that time was huge, and if you ran a congress you filled the room. So you had this huge congress in London, central London, and they were all there Deming, geran and Crosby, oh wow. And the whole session was chaired by a guy called Brian Redhead who was a very well known journalist and BBC broadcaster in the UK and he introduced them in the morning, then we had lunch and then he introduced me as the only UK guru. So I met them there and I met Crosby later at something else as well.

Richard de Kock: 5:11

Yeah, and how did you get on with them? I mean, what were they like? I guess that's something everyone wants to know.

John Oakland: 5:18

Well, yeah, it's interesting because Deming was asked. They were all on a platform at one point. He was very old and crotcheted then. So Brian Redhead asked him what he thought was Crosby's four absolutes. Crosby had these four absolutes and he said how does this work in a prevention system? And he sort of staggered to his feet and said I didn't know. He had a system. They were quite arrogant and they didn't like each other one bit and they were in competition.

Richard de Kock: 5:56

Oh, that's great.

John Oakland: 5:57

One had ten points, another had fourteen points, crosby had four absolutes. So it was a bit tense, but I was about half their age at the time.

Richard de Kock: 6:10

You just sat very quietly in the corner and a popcorn watching it go down. Absolutely the last book you wrote on TQM appears to be in 2014. Aside from the plethora of the publications you had around statistical control, construction and many others what made you feel you had to do a fifth edition of the Total Quality and Operational Experience Method, and what's really changed since 2014?

John Oakland: 6:35

Well, really the world has changed rapidly. Of course, hugely, and certainly in the past three decades. So over that time, every so often with a book like that, you need to revise it. And although the notion of quality of business improvement has exploded since the first edition, even in the last five years, since the fourth edition, there's been huge changes and we've given that over that 30 or years, if you like, everything has changed Business. The world today is almost unrecognisable from that time.

John Oakland: 7:19

The main driver, of course, has been the huge technology and software development that's led to the big data world that we live in today. The process of evolution has speeded up exponentially to drive changes. You couldn't even have thought of seeing smartphones, tablets, even existing in 1989. Now they've completely taken over our lives. I mean, if you just take data in manufacturing, in the past we used to worry about not having enough data. Now we've got. We can't see the woods for the trees because we're generating terabytes of the stuff. So, every thing you look at, every service, every retail organization, huge volumes of data and not surprisingly then, even since the publication, the last fourth edition interesting quality to keep your customers, to keep them loyal has exploded to keep pace with that technology. Much learning has taken place, even though the last five years in our organization, with our clients, with our research work at the university. So it's been necessary to rewrite the book, revise it again, and the content of this later edition does reflect the developments, the current understanding, the experience we've gained in this era of big data.

Richard de Kock: 8:56

And you'll sort of elevate a pitch that you would give to your specific TQM approach. What would it be?

John Oakland: 9:03

Well, I mean, the core of any business has to be, of course, that the heart has to be the customer, and so any approach that's got the word quality in it is going to be centered on that. But really, the word total is very appropriate because it's all it's about the whole business, and it starts with the top, the senior team, the board. I would never work with an organization that wouldn't be talking to us at the very top level, because the whole thing is driven by the vision, the mission. And then you start wanting to plan all that. So we have the first of our so-called four P's around total quality model, which is planning.

John Oakland: 9:49

So the vision, the vision, the critical success factors, what's going to be key to your success? How are you going to measure that and then translating that into a result performance, if you like. So are we satisfying our customers? Are we making money? Have we got the turnover? Have we got the number of students in the university? Are they all getting degrees? Are we curing the patients in the hospital? So performance is a big deal. So you've got all the planning linked through to performance by how you set that up. The business is about the processors and the people in it. So that's how we arose, came to the four P's of the model, and surrounding that are the what those are. We call those. The hard management assesses the four P's and then we talk about the three C's and the soft outcomes, or, if you like, the things that make it all work, and that's the culture of the organization, the commitment, starting with the senior team and cascading down through the organization. And then the communication, how you communicate with everybody in and outside the organization.

Richard de Kock: 11:07

Just for our listeners benefit. So performance the four P's would be performance at the centre point, and that would then be surrounded by planning process and people.

John Oakland: 11:17

Yeah, you've got like a triangle of the the planning at the top, the people and the processors in the other two corners and in the middle is your performance. And that is everything the balance scorecard and customer, the business results, the society that you live in and everything that you need to measure about how well you are doing and your survival in the future of the business. And then surrounding that is a ring around the edge of the triangle and in the spaces between the triangle and the edge of the ring are culture, communication and commitment.

Richard de Kock: 12:00

So something that has always interested me was there was research I'd done some time ago about how TQM initiatives had really battled to get successful adoption over the last 50 years. Because, well, they believe that one of the main reasons was there was a lack of a clear definition around what quality or total quality management was. I mean, is it a strategy, a culture, a process, a methodology? And it often means different things to different people. So someone in marketing will have a completely different perspective of what it would be to someone in production or, starkly so, even customers themselves. They'd have a completely different perspective as to what quality was. And I'm curious as to how you might define quality and whether you agree whether or not this was in fact, a challenge for the industry in getting good adoption?

John Oakland: 12:46

Yeah, it's a good question. Well, let's start with quality, and it is one of the most misunderstood and quoted words perhaps there is. Quality still exists a long time after the beauty of paying a low price for something has passed by you, because quality is all about meeting our requirements. So we're not talking about Rolls Royce quality versus a mini car quality, because both of those things can have quality if they meet the requirements of the customer. If you want a vehicle to drive round in that really makes you look good and you look like the president of the US good day to talk about that being the change of the president of the US so yeah, have a Rolls Royce. You want to try and park the car in London? You don't need a Rolls Royce because it's not meeting your requirements.

John Oakland: 13:47

So then you get into well, how have they designed the product? And then do they make the product to meet my requirements? Say, with IT, look at the software problems that we have now, even in our cars we get in real problems because people are forgetting that quality is about how you design the thing, how you design the service or the software, whatever it is, and then how you meet those requirements. Of that design? Do you make it the way you should do? Is it what the customer ordered when he or she gets it? And that's all around the quality thing. So if you're saying people don't understand that, then we need a better process to educate people about that, and then everything you do is around the business to give the customer what they want. If you do that, you will make money or you'll survive. As an education institution or even a tax collecting outfit has to deliver against what the customers want.

John Oakland: 14:58

And so you then you need a strategy. And you said is it a strategy? The answer is yes. Is it a process? Yes. Is it about the people? Yes. Is it about the culture? Yeah, that's why it's called total quality, and my experience from the research we've done is all about the leadership's understanding of this stuff. They're integrating a quality strategy into their business strategy and the quality managers, if you like, of the business have got to be able to speak the language of those business leaders. So if they get used to you mentioned in the elevator pitch, you know they get into it. If you get the obvious quality manager getting to the lift with the chief executive, the chances are the chief executive will can't wait to get out the lift and the quality manager missed his opportunity because he can't get across, just he can't speak the language, if you like, of the board and that often results in disappointment and what you said, that people feel that it's not total. Quality management has not delivered for them, and I think it's lack of understanding, real commitment, leadership.

Richard de Kock: 16:17

You know, I find that such an interesting point, especially the analogy about the quality manager coming into an elevator with the CEO and you know that's their chance to you know, really engage with each other. You know, because, tragically, I think there are so many opportunities missed between IT and business and being able to have constructive conversations and understand each other, and what's missing for that, I suppose, is that they don't have a common frame of reference. Tqm may be one of the tools that could be used to really address this gap, because both can speak a common language.

John Oakland: 16:51

Yeah, I have to say I'm not. I'm not wedded to the using the term total quality manager. We're discussing it now to give ourselves a reference framework for talking about an approach. You can call that approach business excellence, organization excellence, call it whatever you like. You know putting the customer first.

John Oakland: 17:17

You see all these programs and slogans that people have used and they're absolutely fine so long as you have everything in the pot. It's like cooking a meal in the kitchen. You know, oops, we forgot to buy the potato. Don't forget to buy the flour. Or the electricity is not working, you know, or the oven's cooked or the timer's gone wrong. Any part of that will screw up the meal.

John Oakland: 17:46

So it's an approach to say let's make sure we've got everything in the business, including, very importantly, all the people equipped with the right capabilities to do their job, and not only, for example, if you take the IT world, which we're now heavily into, we've got a big part of our business is big data, data analytics, data engineering, architecture, data governance.

John Oakland: 18:15

We're in for about 30 techie people and if they are not engaged with the processes in the businesses of the clients that we're working with, if they can't communicate with those people about what they're helping their organizations to do, there's going to be a huge problem. And when we talk, when we talk to clients, they often say to us that's great, you guys really understand business as well as all this data stuff. You know very few of the data providers, the big data architecture people, data analytics people. They don't really understand that and they love the link, the technology, the processes and the people and that's so important. So this is not something that was all right 30 years ago. This is still absolutely key to every organization in the world that's trying to do a good job.

Richard de Kock: 19:20

So John, let's look at things a bit practically and I want to try and empathize with CEOs and CIOs of organizations today. They're in these really turbulent conditions. They're needing to reinvent themselves, reinvent their organizations, and in doing so, they're having to invest their energy, their resources for, you know, for the organization's future survival. They've really got to make sure that they're really focused on getting things right and a lot of turning to modern types of best practices and frameworks like DevOps or AI and customer experience management, etc. What would your message be to them? You know, why should they be prioritizing their resources on total quality management as a discipline, as opposed to any of the other types of frameworks out there? I mean, how do you convince them to focus their energy in that space to get the most out of their efforts?

John Oakland: 20:18

Yeah, well, yeah, I've done a hell of a lot of work with people at very senior levels in some very large organisations the airbuses of this world, the BBC, network Rail and so on and I would never start talking about total quality management. I wouldn't say you have to use total quality management. I would start talking about their business and I would want to hear what they said about what their vision for that business is. If they don't have a vision, then I would help them articulate that vision.

John Oakland: 21:00

I would help them work out what it is that they have in mind of this business being like, whatever it is, whether it's a hospital, a pharmaceutical company, a university or whatever and where does it want to position itself in the marketplace, if you like? What types of people does it see as its customers and what objectives would we have in terms of the marketplace? How big do we want to be? How quickly do we want to grow? Do we have the idea that we'll take over the world? We've got three or four other companies that we have in our sights to take them over. Because all of that is the bedrock of how are you going to manage the organisation. When you start to put together the plans, the processes, train the people, get the right people in, get rid of the people that are not the right people, when you come to measure your performance in a balance scorecard of everything that matters to this mission, then it all falls into place. Over the years, we have done a huge amount of work with senior teams to thrash that out and when you get down to talking about what are the key, the critical success factors of this business I'll let you have eight. You know we must have this, so we need that, and it's got to be an output terms. That's a hell of a thing for a senior team to come together and agree, and if they don't agree, they'll all go off and have their own version of what we've all agreed. And if it's not agreed, properly agreed, then there'll be all sorts of things going on, especially in a large, complex organisation. All sorts of things going on that will not help you achieve that vision. In fact, it can pull the organisation apart Marketing, selling things that we can't make, or you know, the design people being totally disconnected from the ability to produce that in the organisation. The nurse has not been in tune with the doctors and the admin, people behaving as if they're all a separate part of the organisation.

John Oakland: 23:36

All of these things need attention, and what I would argue is that the frameworks that we've come up with through our research and our advisory work over the years and why I wrote the book, if you like all of these frameworks help you do that. They help you deliver excellence in your organisation and excellent results. So who can argue against that? Whether you're an IT person, you're a marketing person, a chemist, you know, a doctor, we all want to work in an organisation that's pointing in the same direction, all pulling together, all delivering the vaccine into the arms of the people, whatever it is. You know that's what we're here for.

John Oakland: 24:23

So all this is about. It's not about saying, oh, you're not using total quality management, and you should be. It's all about saying what do you want to, what do you need to help you achieve what you want to do in the business? That's the key, and I believe we've got. We've got the frameworks that have drawn in all the things you need, and that's why it's been so easy for us to move into the technology area, into the big data area, because now you can't run any organisation without that.

Richard de Kock: 24:57

You know that's a really important point you've raised. I think that's something that most people get lots of sites of is you know, when organisations are running Six Sigma programmes? I know in IT for argument 6, we get really caught up on the different methodologies we're using, like DevOps or Idle and things like that All highly valuable and practical approaches and methods but what ends up happening is, I think, we all become sort of cultish and we start to follow that framework in that methodology, to the exclusion of everything else. And this is probably, I think, the point that you're making is that we need to be focusing on the actual organizational paint point, the organizational strategy, and making sure that you know the focus on these methodologies is not at the loss of what you're focusing on.

John Oakland: 25:46

If you take you mentioned Six Sigma, for example. Six Sigma got really hold of it. Like all these things have their side and their time. Jack Welsh did a great job with with Six Sigma in GE and what that was about was focusing on how can we reduce variation when, if you think of, if you, if you go to a restaurant?

Richard de Kock: 26:13

and you say oh, I really enjoyed that.

John Oakland: 26:16

Let's let our next time I'll get taking my boss out, I'll take him to that restaurant. What's in your mind as you're getting ready to go out that evening? That you're going out with your boss. You're thinking, I hope, I hope they do the job, I hope they as good as when I went there with my wife or my husband or girlfriend or whatever. And it's because you're not confident that they're going to deliver the same experience. And that is all about variation. Everything, everything has variation in it. Trosses have variation. People come to work one day. They're not as good and good and moved. They do things differently. Materials vary, chemicals vary, and if we're going to control the way we deliver things so that the customer has the same experience, then we're going to try and control that variation.

John Oakland: 27:13

And all six Sigma D was to try to reduce variation so that we had less poor quality materials, less cars that leaked oil and so on and so forth. And six Sigma had its time because it focused on that. Lean had its time because it focused on why we're wasting all this time waiting for things to come to the machine, sitting in offices waiting for something to be passed from one guy to another time, and IT is no different to that. When you look at IT, nobody in the IT world could tell me that all that could be done. All their customers are totally happy, because we all know that we've got bugs in. Stuff is brought to market too early, straight away it's got a bug on it. I have a brand new car that's well less than nine months old. Tomorrow it will be its fourteenth day in the garage. For a recall, and for a recall, for what? The IT, the software, the bloody thing. It won't work. It won't actually start this car.

John Oakland: 28:33

It's the software and the IT, probably hardware as well. There's Kapoor, and they've been a very expensive hire car, which is all of this is going to be costing them a fortune. And that's without me telling you about it. If I was to tell you the brand, I would have told however many people listen to this podcast, and I'm not going to do that. But this Ford did some work years ago, but for every person who gets a faulty motor car, 40 potential customers hear about it.

John Oakland: 29:09

So if that doesn't get you into the idea that we need to do things better than we're currently doing, I don't know what does. And therefore, to make sure that your customers declinus are being matched, you need to get your act together. You need to get the right processes, the right materials, the right people, trained them well, have their capability working on the process that you've designed to deliver what your customers want. So all these frameworks have their use. They have the use to focus the mind on what we need to do To not have failure, to not have extra cost, to not have waste in the organization.

Richard de Kock: 29:54

So this makes sense, I guess, john, for organizations that see the value of focusing more on quality and getting approaches and techniques and training and software etc. To start to enable them to undertake this journey and start focusing more on getting quality management as part of their DNA. It's not a simple task. There's a lot of work behind it. I know that there's a lot of training. I mean, even from my personal experience, learning total quality management is not something that will happen in a week. It'll take some time for you to really polish your skills and understanding of the concepts and the principles and the techniques, etc. So, organizations that are now thinly resourced and having to respond very rapidly in turbulent conditions, market conditions, etc. What would your advice be to them on how they can start this journey and really get impact as soon as possible so that they're not wasting effort and losing sight of what's going on in the market?

John Oakland: 30:55

Well, we've talked about having the right vision for the organization. We should do it. Perhaps a longer term thing. But if you want, if you like, the quick fix, you have to get into the process as straight away, everything we do is a process. If we research the market, develop a new laptop, even just putting together a list to go shopping, everything is a process. How do you get your list together to go shopping? Well, you must go to the cupboards and see whether there's any more tins of beans left. It's something that you go through to achieve everything we do and it's a process. So my quick thing is understand how those processes work and get people working on those processes quickly around the process as a team.

John Oakland: 31:50

I remember a guy from one of the big component car component companies. He was the chief executive. He was really keyed into this and knew exactly what was needed. He turned that company around from a loss making outfit to be one of the best in the world. He said what do you do with any process? You just get the people who work in it in a room, you lock the door and you get them to draw out the process on the floor and you don't let them out until they've improved that process.

John Oakland: 32:28

So how do we recruit people, for example? What's our process for doing that? How do we get them through probation? How do we make sure that these people we've recruited have got the right capability? And the capability is to be able to operate those processes.

John Oakland: 32:47

If you said to me, john, I'd like you to come and give a lecture to 50 MBA students, I've got to have a process for that. I've got to have a way of finding out what these people are. They finance people or they want to go out and run the work. What are they wanting from me and how am I going to deliver that outcome where they walk in a way and say that was worth that hour spending? I've really learned a lot and these three things that I wanted out of that. I've got them, and it's all about my having the right process and the right ability to operate those processes when I'm in there.

John Oakland: 33:27

So if you want a quick fix, it's focused straight in on your processes Find out what they are, quickly map them, get the people around them and say how the hell can we do this better? Now, that obviously is a lot work there, but that's the essence of it when we get new tech people into our organisation, this is language they are not very familiar with. They don't think process. You think I'm paid to write software. Say, yeah, what's the process for that? How do we know what we've got to come to? Heroes building bridges and you know £5 million over budget and it's a month late already. So how do we help them with that? And when we teach our people how to engage with the business? I actually have a view that many IT people are operating are not sufficiently focused on what their business is trying to achieve and some of the stuff that we are trying to use, particularly software, it's got plenty of built into it and it causes a lot of frustration.

Richard de Kock: 34:47

That's really insightful. I mean, I guess to further to that. I mean the other challenge would be how do customers or companies identify which processes they should be working on? I suppose that is just a case of Well, that's an easy one.

John Oakland: 35:03

I would start with top two and say I mean from you know about the name Crystal Test Factors, with the key performance indicators that go with that. And that's a small number of performance indicators. Because why is it a key performance indicator? Because there are a small number of them Went into one organisation who once told me they got 127 key performance indicators, which is an oxymoron.

John Oakland: 35:32

So you know, let's have a small number of measures, let's know what's critical to our success, and then you determine what are the six to eight core processes in this business and you get the top team to identify them and then you break those down into their sub-processes and you get the engagement of the people at the various layers of the process architecture involved in that and they say, well, this process is lousy, that's why we've got problems, and before you know where they are, they've improved the process that they're working in. So you start with the top, you get the core processes and then you break them down and you will notice, Richard, that's well documented in my book you know the tools that you need to be able to do it Absolutely. And there's software, there's loads of software that can help you do that.

Richard de Kock: 36:34

Absolutely so. John, if you could start over and do it all again, what would you do differently?

John Oakland: 36:40

Yeah, I think I'd get into the boardrooms quicker and yeah, I was a young guy when I started, so you can't walk into the boardroom when you're 33 and start throwing your way to them. So I used to work a lot with quality managers. We were the only people in the academic in the business school working in quality. We had to hit a gold scene when Ford discovered Deming. They discovered statistical process control. They realised why the Japanese were taking their heads off with good quality and reliability and the car industry in the West was terrible compared with the Japanese. So they started to look at what they were doing and it all came out quality so that in the West often went into the quality management fraternity. So we spent a lot of time wading about trying to drag these people screaming into the 20th century if you will then, and they've got quicker into the boardroom.

John Oakland: 37:51

I think you need to get the chief executive on board. All the guys and gals who I know, who really made a difference at the chief executive level, really understood this and I would spend. It's not possible to do it now, but you take them out to dinner, you have a good talk about everything to do with their business and you get them to be able to understand how vital this was to the success of their business. So, time over again, I'll get into the boardroom at a higher level quick guy.

Richard de Kock: 38:29

Thank you so much, john, for joining us today and for sharing your pearls of wisdom, and for all our listeners, thank you for listening to the Search for Clarity. We will be posting some more information on upcoming episodes in the next couple of days, so please keep your eyes peeled for that. Get engaged on social media, ask questions, share feedback. Until we meet again, may the search for clarity continue.