Total quality management
a barrier to innovation
The declining competitiveness of U.S. industry at home and abroad over the past two decades is a well documented concern. Yet, at a time when market-driven innovation and entrepreneurship are critical to recapturing our competitive position, many organizations are wholeheartedly embracing Total Quality Management—a process that is a barrier to both.
The TQM process reinforces incremental innovation to the detriment of breakthrough innovation. As companies take what they have and look for ways to continuously improve it, many may be trying to improve processes that are fundamentally faulty, and there is no point in improving a process that may not be right in the first place.
“Quality” means a variety of things within organizations. For most, it translates into finding ways to do more with less—with fewer people, faster, at lower cost. Too often, organizations assume that the processes they have in place are right, just imperfect. So they adopt TQM to improve existing processes. They encourage their people to seek out small, incremental improvements that can be implemented without disruption. The assumption is that if a process is improved little by little, step by step, it will become a “quality” process producing “better” product.
As a result, businesses are spending millions of dollars and deriving few tangible results. Nine out of ten firms surveyed by the American Management Association in 1993 have quality improvement programs under way, yet only a quarter of them are likely to achieve significant results.
TQM has people focused on the minutia of the quality process when they should be challenging the processes with innovative, breakthrough thinking—the kind of ideas that represent a substantial change from the current functional and structural ways of working (e.g., reducing new products to market time by 50 percent). Innovation is doing things differently. Quality is doing things better. Both are needed.
When a company is an industry leader, quality processes can produce incremental improvements that will help it maintain its leadership position—for a time. To maintain the lead over the long term, however, companies need to be constantly pushing ahead, constantly innovating. Similarly, competitors that benchmark their processes against the leader and initiate quality processes intended to wring the improvements needed to catch up, never will. To achieve—and, ultimately, to retain—market leadership requires breakthrough thinking and step-out innovation that goes beyond simply improving processes. It allows organizations to anticipate and move toward the future. If benchmarking competition is a strategic initiative, use the findings as a target to beat, not just match the competition. Simply improving what you are doing today is not enough.
Barriers to Innovation
When we asked people about barriers to innovation, we often heard: “We're too short-term focused.” “There are budget constraints right now.” “The approval process is too long and frustrating.” “We're too busy with day-to-day work to think about doing anything new.” Now we are also hearing that the quality process prevents people from “thinking too far outside the box.”
Most people see the barriers to innovation as organizational, resulting from such internal pressures as a short-term bottom-line orientation, a risk-averse environment, and a lack of innovation focus and reward, and such external pressures as pricing, competition or dwindling markets. Yet, there is another set of barriers companies must address: the people barriers. These have to do with the quality of dialogue and interaction that is critical to getting new ideas and to building the commitment required to implement them.
The barriers to innovation in organization are difficult enough to overcome without the added dimension of TQM. When people get punished for taking risks or making mistakes frequently enough, they become afraid to express their opinion, point out ways to improve a situation, or offer their suggestions to management. The narrow focus on measurement often leads teams to work on unambitious goals and derive unambitious solutions.
In recognition of this problem, the prestigious Baldrige Award for quality improvement recently expanded their definition of “continuous improvement” to include “breakthrough” improvement as an objective along with the ever-present incremental improvements. Even with this encouragement, however, indications are that most companies with TQM programs focus too closely on existing work methods, processes and operations, to allow for much breakthrough thinking to occur.
Interestingly, a recent study cited in Business Week concluded that most individual “Americans aren't interested in making small step-by-step improvements to increase quality. They want to achieve the breakthrough, the impossible dream.” For them, continuous improvement often means work harder and faster, do more with less, don't try things that might not work—in other words, don't innovate.
Many companies also place an intense focus on analysis and control that acts to discourage creativity. The first test of a new idea is often financial analysis, but there is a tendency to carry quantitative examinations of embryonic concepts too far, too fast. The techniques used in the quality process tend to encourage premature evaluation and early rejection of ideas.
American business's reluctance to innovate is reflected in its short-term orientation. Business would rather introduce a line extension next quarter than come up with something totally revolutionary and new. Business would rather look for ways to improve existing processes than to start from scratch.
A Potential Remedy
Business needs an infusion of new ideas and, more important, an organizational climate that welcomes new ideas. Organizations that embrace innovation as part of their quality effort are harnessing the vast creative capacity of their people, and, as a result, they are blowing the competition out of the water.
What are they doing differently than your organization? Each has incorporated into its management process most, if not all, of these tenets:
- Encourage a learning orientation. Bring curiosity back into focus. Encourage people to talk with others, both inside and outside the organization—customers, vendors, and so forth.
- Create long-term goals. If American business's vision goes much further than the next quarter, we consider ourselves lucky. People thrive on the challenge of stretch goals.
- Manage innovation proactively. This is not a management skill that can be picked up by osmosis. The best companies have formal training for their managers to learn how to drive and manage the creative process.
- Make both breakthrough and incremental innovation a visible core of the organization's strategy. Consider separate funds for innovation activities.
- Create a reward and recognition system that's consistent with the goals of your program. Reward both team and individual efforts, not just successes. To truly encourage innovation, reward the experiments people try and the risks they take, whether successful or unsuccessful.
- Create opportunities for cross-functional collaboration. The quality problems and opportunities that companies should be concerned with cross boundaries—they don't just live in one area or department.
- Teach teamwork. Most organizations have people working alone. Teach them how to operate in a team environment—how to listen, how to generate and respond to creative ideas, how to resolve conflict, reach decisions, and build commitment to courses of action that are different from the standard.
- Encourage people to use problem-solving skills. People who are successful problem solvers—and everyone has the capacity to be so—are in much better position to make unconventional, creative connections, and break out of existing paradigms.
- Teach people to access their creative potential. The act of creation is a discipline. Knowing where to look and how to identify opportunities for innovation is an important aspect of the creative process.
- Stop treating TQM as the pill everyone in the organization should take. The formula approach to quality stifles the more chaotic nature of the creative process.
- Recognize and identify barriers to innovation and take concrete steps to overcome them. Adopt comprehensive business systems which combine organizational resources, available technology, thorough market research and competitive analysis to launch truly innovative ideas that meet strategic growth objectives. ■
Houda E. Samaha, CMC, is an independent consultant based in Framingham, Mass., and an adjunct faculty member of Lesley College School of Management's OD curriculum. She is the author of several articles on innovation and change.
PM Network • February 1996