Ringing the Bell with Quality Circles
By David Hutchins, Chairman David Hutchins International Limited
Reprinted from Management Review and Digest first published in 1982.
Note: The red typed material has been inserted recently to put everything in context.
We republish it here on the DHI website in 2006 for the following reason: In the year 1998 there were reported to be more than 20 million Circles in China and in every country in the Far East. Both Toyota and Honda announced in 2004 that they are going for 100% involvement in Quality Circles in all of their plants worldwide.
Toyota and Honda are both making huge profits in their manufacturing plants in the USA, China is about to enter that market. At the same time, General Motors are reported to have lost $1.5Bn in the first six months of 2004, MG Rover was liquidated and the plant is now owned by the Chinese.
Ford also lost money and Chrysler are currently in deep trouble. Of course it is not all down to Quality Circles, it would be stupid to suggest that it was but they are part of the reason and that is good enough! Why do Toyota and Honda clearly regard the concept to be so important whilst the West completely ignores it? Who is right?
"David Hutchins - 1982
Management interest in the UK in Quality Circles is growing fast. We asked David Hutchins, a recognised authority on the concept, if he could help BIM members by discussing how companies and managers should approach the introduction of Quality Circles. What should they expect from them? How should they be formed? What are the do's and the don’ts? We asked him if he would write a practical article for practicing managers; and he has.
Currently there is something like about 100 to 150 companies in the U K who claim to have Quality Circles. Sadly, for the majority of them, they are unlikely to be able to make the same claim one or two years hence. (This has proved to be prophetic! - inserted) In some cases, failure may be only months or even weeks away. Even amongst many of those which survive, the chances are that they are unlikely to achieve anything like the full benefits which can accrue from the proper implementation of this exciting concept, which is so new to the West.
The reasons for their failure lie not in any short-comings in the ideas themselves. On the contrary, the concept is so soundly based, that it is reasonable to claim that, if properly implemented, the Quality Circle Concept should eventually become a way of life for everyone in an organisation. Failures amongst companies, who have taken the trouble to prepare themselves properly before the implementation of Circles, are non existent either in the U K, the United States or Europe.
For them, the prospects are that eventually, they will be so able to galvanise the resources of all their people, that product defects will become almost non-existent. Productivity will go beyond anything even remotely attainable through direct payment by results or other financial incentive schemes, and eventually even product development will be affected.
Fortunately, a few companies are aware of this, and, realising the potential offered by Quality Circles, they have taken the trouble to make very careful preparations. These include training, awareness seminars, and for many, a complete rethink of their attitudes towards the people they employ. (Wedgwood in the UK were one of the first to implement Quality Circles and they did it correctly. When the Quality Manager was asked in 2002 (how much have you saved?’ the response was ‘we have no idea, it must be millions but more important than that, we would not be here by now if we had not done it!’ - Inserted). Failure to realise the importance of any of these points will eventually bring about the failure of' the programme, and as has been mentioned earlier, it is known that many companies have unfortunately already made mistakes.
For example, recently a training officer telephoned the offices of David Hutchins Associates (now David Hutchins International Limited) at 11.00 in the morning and said `I am running a Quality Circle training programme at 2.00 pm this afternoon, and I wonder if you could tell me what a Cause and Effect diagram is?'
A Cause and Effect diagram is one of the most important tools in the hands of a Quality Circle, and a working knowledge of it is essential to anyone contemplating such training. Many organisations have implemented some kind of programme without any training whatsoever; others have attempted to start Quality Circles on the shop floor without even informing senior management or executives as to the nature of the programme or its implications.
Some have failed to involve the unions or shop stewards, while others have failed to inform or involve such specialists as quality engineers, production engineers and so on. But the majority will fail because they have failed to appreciate the precise nature of the group itself. They do not have Quality Circles at all; they have groups similar to task forces, action centered leadership groups, communication groups, job enlargement groups, briefing groups, value engineering groups, or others, but NOT Quality Circles.
Definition of a Quality Circle
A Quality Circle is a small group of people, usually between three and twelve but normally eight, who do similar work, who meet together regularly for about one hour per week or fortnight in company time, usually under the leadership of their foreman or supervisor, on a voluntary basis, to identify problems, analyse the causes, recommend their solutions to management and, where possible, to implement the solutions themselves.
Of the many forms of small group activity which exist, most fit one part or another of the foregoing definition, but not completely. In which case the group cannot be called a Quality Circle, and whilst all may make some notable achievements, none will achieve anything like the potential of a true Quality Circle, particularly when such activities have become developed on a company wide basis.
To understand the reasons for this, it is necessary to look at the definition in detail.
A Quality Circle is a small group of people who do similar work.
This rules out task forces, action-centered leadership groups and value analysis teams. These are normally made up of people who do different work, who come together to attempt to solve some pre-stated problem, or to reach some pre-defined objective. A Quality Circle on the other hand is comprised of people who have similar experience and similar skills, who identify with each other in their work, and through the Quality Circle, determine their own problems, or objectives.
Subsequently, they remain together and determine new problems to solve or set new objectives. Action-centered groups on the other hand, often disperse until the problem has been solved. Groups may be reformed using different people depending upon the nature of the problem identified, but rarely are they in the position to subsequently control the solution. It can be seen, therefore, that a Quality Circle is a completely self determining operation.
Meeting voluntarily on a regular basis.
It is a mistake to think that Quality Circles in Japan meet entirely in their own time. It is true that they do meet at times other than those allocated by management, but this is because they want to, because they are so interested in the nature of the problem they have selected that they do so by their own choice. Where Quality Circles have been properly introduced here in the West, the same effect is observed.
To identify problems, analyse the causes and recommend the solutions to management.
Up to this point Quality Circles could be regarded as similar to communication groups and briefing groups. However, these groups are not usually formed to actually solve problems. Communication groups are generally intended to communicate problems upwards for others to solve, whereas briefing groups are intended to pass management policy and company information downwards.
Where possible to implement the solutions themselves.
Quality Circles are concerned with solving problems in their work, and not to highlight `those other people's problems'. If this requirement has been rigorously adhered to then the implementation will normally not require a decision by others outside the group.
To ensure that Quality Circles do concentrate on this type of problem, and do not degenerate into canteen committees, training is necessary in the appropriate techniques. Many so called Quality Circles are likely to fail due to a failure to recognise this need.
Of all the problems involved in the establishment of Quality Circles, perhaps the most worrying are:
1. Lack of training of Quality Circle leaders in both group dynamics and in the techniques. (In 2006 this still applies not only to Quality Circles but most new management concepts. Far too little training is being carried out with obvious consequences)
2. Groups formed of people who do not all do similar work. (This has changed to some extent since those early days because industry itself has changed. It is now possible to form Circle type teams but there are issues that need to be addressed.)
3. The members include some, such as managers or specialists, who share a different social perspective from the other members of the group. (This is still true today – 2006 – the members should at least be of a similar status in the organisation)
In the case of item 2, the Quality Circle is likely to fail because there will be many occasions when the nature of the problem selected is such that it is impossible for all members to feel involved.
For example, if a group of machine operators also includes say one or two people from maintenance or quality control, this will either restrict the problems to those which affect everyone or, there will be many occasions when some members cannot contribute. If this happens frequently, and for long periods, these people will eventually lose interest and leave the group. The group may eventually disperse altogether.
In the case of item 3, it sometimes happens that a manager or specialist is included as a permanent member of the group. In this situation, the less educated members of the Quality Circle will often feel inhibited and shy, will hold back their suggestions and, when they do make them, will usually offer them for judgment by the senior member, who will probably enjoy the implied status offered. The effect will be that the members will not feel involved, will not feel that it is `their Circle' and will soon become demotivated. It is vitally important that all members have one vote, feel equal, and that their contribution is taken as seriously as any other.
So far this paper has concentrated on the problems which can arise from the formation of the Quality Circle. However, other problems can arise before that stage is reached. Before implementation it is necessary to ensure that the environment is receptive to such an approach.
Quality Circles are another way of treating people, and the programme can easily be disrupted by any manager, specialist or, perhaps, shop steward, if they choose to be antagonistic.
It is important to realise that the Japanese evolved Quality Circles after years of development of a participative management style. In the West, Quality Circles are being introduced in many cases where such a style does not exist, (It is now very much better than it was at that time and it must be much easier to make a success with Quality Circles in 2006 than it was in 1982 particularly in organisation with Six Sigma and Lean Manufacturing initiatives) or where it has not yet been fully developed. Therefore, it is important that consideration is given to this problem before training begins. For successful implementation, there are six considerations:
1. Quality Circle Steering Committee.
2. Quality Circle Facilitator.
3. Quality Circle leader.
4. Quality Circle members.
5. Non Quality Circle members.
6. Management and Specialists.
Quality Circles Steering Committee
The Quality Circle Steering Committee is not usually just another committee, but merely an item on the agenda for a group which probably already exists within the organisation. The purpose of the Quality Circle Steering Committee is mainly to demonstrate management commitment to the Circle programme, and this will be the most important form of assurance to potential Quality Circle leaders, line managers and others directly involved in the programme.
It is unlikely that total support to Quality Circle activities will be given if the head of each function has not demonstrated his commitment. It is therefore essential that the Steering Committee is formed at the highest possible level, preferably at director level, and that the chief executive has shown his personal commitment.
The duties of the Quality Circles Steering Committee include the allocation of resources to Quality Circle training and their activities; decisions regarding the rate of development in the organisation; the appointment of the Facilitator; and the relationship between Quality Circles and other groups.
Quality Circles Facilitator
In the development stage, the Facilitator is the hub of the wheel, the prime source of information, coach, trainer, coordinator and promoter of Quality Circle activities. His/her selection is probably one of the most important tasks of' the Steering Committee, and the wrong choice will seriously affect subsequent developments.
His or her personal qualities are far more important than his current role in the organisation, but the fact remains that if he does have the right qualities, the chances are that he is already a key person in the organisation. Unfortunately, he is also probably the one it will be difficult to spare for the introduction of a new and as vet untried idea.
This, of course, will be the best measure of management commitment, and will demonstrate convincingly to others the importance attached by management to the introduction of the concept. The fact that to do the job properly requires full-time commitment in all but the smallest companies, does not make the task of selection any easier.
Quality Circle Leader
The Quality Circle leader is usually the supervisor or foreman of the group from which the Quality Circle has been formed.
In the early stages, the selection of the right person is important because the subsequent development of the Quality Circle programme will depend upon the impression given by the first Quality Circles.
To start where the grass is greenest is probably the best policy, and selection should be made from the potentially best supervisors, who have the best relationship with their group. Some companies attempt to start in the areas where they think they have the biggest problems but this is not a good idea.
Quality Circle Members
Because membership is voluntary, it is not possible to be absolutely certain where the best areas to start may be. Usually the supervisor with the best personal relationship with his group will be the one most likely to obtain volunteers, but the biggest problem for most companies is not so likely to be whether or not volunteers will come forward, it is more likely to be `What do we do if more people wish to join than can be accommodated?' In such situations, the answer may be to start more than one Group. Most will accept the fact that they cannot be in the first Quality Circle it they know that there will be an opportunity to participate later.
Non Member Employees
In any work area, the chances are that there will inevitably be a number of people who cannot, or sometimes do not want to become members of a Quality Circle. If care is not taken, these people could quite easily regard the Quality Circle as a clique within their workshop or office. It is most important that Quality Circle members should involve these people as much as possible, and that the Quality Circle should be regarded as `their Circle'.
Management and Specialists
A Quality Circle will only be fully effective if it knows how to utilise the skills and specialist knowledge already available in the organisation. A properly trained Quality Circle, therefore, will usually involve specialists as consultants. They will not, or should not, become permanent members of the Quality Circle
To summarise the philosophy of Quality Circles, the Quality Circle itself is a completely voluntary body. Nobody is paid to join, nobody is forced to join, and nobody is penalised for not taking part. The motivation is solely the desire to do a constructive job of' work and to find satisfaction in seeking the results of effort.
The Quality Circle, once formed sets its own terms of reference; selects for itself the problems that it wishes to tackle; and in due course, presents its recommendations for their solution. In other words, it functions organically - according to its own perceived needs - rather than compulsively in response to externally determined criteria.
It means that all people in an organisation must be regarded as caring responsible employees, who, given the opportunity and recognition will make contributions to the success of the organisation consistent with their sense of' responsibility and need for identification. This usually goes far beyond anything regarded as possible with incentive schemes and other carrot-and-stick methods.
The opportunities offered by the successful application of the concept are such that it would be a tragedy if these opportunities were denied by lack of preparation or ignorance. There are now about 30 companies in the UK who are already beginning to feel the effects, and achieve the results of' thorough preparation, and hopefully, they will become an example to others.
Reprinted from Management Review and Digest 1982"