Why a Quality Management System in Service Industries?

Everyone tends to resist change, but companies that delay in establishing a quality management system will find they increasingly become less competitive and less effective in markets where customers demand trouble-free products and services.

By Kunal Bhalla

In every organization, both management and the general workforce tend to resist change, whether it be in systems, culture or environment. That is natural – people are usually happy to continue with what they have always done. The change brought about by the introduction of a quality management system (QMS) – particularly in service industries – is no exception. However, companies that resist this change will find that they become less effective, and thus less competitive, in markets where customers demand trouble-free products and services.

To address the resistance, it helps to look at the questions that stakeholders may have about QMS in their company:

• “Why do we need to document a process?”
• “Why do we need an organization chart?”
• “Why do we need version control and document control?”
• “Do we need QMS if we only have 100 or less employees?”
• “Does QMS provide any internal efficiency or is it only to provide a competitive advantage?”

These are the questions that all stakeholders need answered before embarking on the journey of installing a quality management system in their company. In addition, there are other questions mainly for the management of the company. Here are two important ones:

• Does leadership want a quality management system for some type of certification, or does it really want the company’s work to have a systematic process-oriented approach?
• Does leadership understand how the current “pain” areas can be minimized or eliminated if the company has more efficient processes?

A System for Developing or Improving Processes

Establishing a quality management system is not rocket science. The intent of any QMS is simply to provide a system for developing or improving processes through a structured approach, effective deployment and better control. Answering a couple of the stakeholders’ questions can help explain this and make the need for a quality management system more clear.

“Why do we need to document a process?” Some might argue that everyone knows the process and has been trained in how to do their work, so why document it? The response must be that in service industries, especially in a high-attrition environment like business process outsourcing (BPO), it is all the more imperative to have documented processes.

Documented processes help in the following ways:

• Processes are optimized when best practices are documented.
• Processes do not become person-dependent – any new employee knows how to do the work.
• Key activities run smoothly when responsibilities and accountability is clearly assigned.
• Defects are easier to capture and eliminate at the earliest stage.
• Prescribed corrective actions can be taken as soon as defects occur.
• Written changes in procedures and policies reduce ambiguity and increase change control in the environment.
• Consistent process measures help gauge if everything is going well.
• Better understanding of processes ensures compliance in service delivery.

The quality management system not only provides a structure and framework, it also ensures the rigor of an audit mechanism that enforces corrective action. Continuous improvement happens within all processes in a systematic manner.

“Why do we need an organization chart?” An organization chart outlines the support structure for every individual process and also gives the roles and responsibilities required for each of the blocks on the organization chart. The benefits are:

• An organization chart allows clients to see the support structure for products or services.
• The roles and responsibilities give a clear understanding of the job for the person who is new to the system.
• The documentation of roles and responsibilities does not leave anything to interpretation that might vary from person to person.
• The roles and responsibilities define the skills that are required to do a particular job.
• Once the skill has been defined, then it can be verified to see if it is resulting in a high-performing individual.

Clearly, something as small as having an organization chart can bring a great deal of value and clarity to the system.

The Basis of Quality Management System

A quality management system works on eight key principles:

1. Customer focus
2. Strong leadership
3. Involvement of people
4. Process approach
5. System approach
6. Continuous improvement
7. Decision making based on facts
8. Creating value for the company, its clients and its suppliers

Many times companies embark on a methodology like Six Sigma, Lean Six Sigma or others to solve problems without realizing that these methodologies center on process improvement. For any improvement methodology to be successful, it is important to first have a process management and process measurement system. This helps in identifying defects and then, once a process is improved, a quality management system provides better control for sustaining outstanding performance.

About the Author: Kunal Bhalla has worked in various quality domains including Six Sigma, quality management system deployment and developing vendor management systems. Currently he is working toward developing an integrated quality management system for service industries. He can be reached at kunal.bhalla@in.ibm.com.

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