Quality Comes from Networking

More of the same is not the way to improve any company’s quality capability. Instead, we need to take new paths and redirect our focus. In a connected world, our operations need to be connected, too, especially when it comes to quality. Whilst technical networks provide the infrastructure, people are the real challenge. What we need is honest collaboration.

We need to recognize that these traditional rules no longer apply. Silicon Valley innovators and Asian hot spots have long followed new rules and are tremendously successful in doing so. We can see that our established processes no longer meet the requirements posed by the increasing complexity of our products, the innovation and market dynamics and today’s billowing networks. Increasing recalls, numerous quality problems within the field, the inability to manage major projects – these are all alarming signals.

Today’s dynamic requires more flexibility culminating in agility. Three fundamental principles characterize agility:

Incremental-iterative working – performing many loops (iterative) of trials and tests in tiny steps (incremental) in order to evolutionarily develop a functioning solution, product or even business model.

Subsidiarity – delegating as many tasks, actions and problem solutions as possible to the lowest hierarchy level, which is expressed in self-organization and self-control. This includes network Partners.

Orientation on customer requirements – focusing on fundamental, emotional customer requirements instead of purely technological demands.

These principles, which can be manifested in frameworks such as Design Thinking, Lean Startup and SCRUM with their dozens of methods, do not stop at company boundaries but rather reach far into company networks. A lot of the time, it is the development departments who are the first to adopt agile principles. Agile methods have already been established in software development, and have clearly proven themselves over twenty years. Step by step, hardware developers have adapted agile techniques for their interests. However, the clear boundary between pure hardware and pure software, in which each is developed using different methods, no longer exists. Today, complex products are usually an inseparable combination of hard and software.

The idea of differentiating between Slowware and Quickware suggests itself. Slowware defines the elaborately developed, finished product that is handed to the customer. Quickware, on the other hand, is developed agilely, handed over to the customer at an immature stage and is further developed during use-based, on-field problems that are recognized and solved at lightning speed. Quickware causes a drop in the prevention share, as this can no longer be performed for complex products with acceptable effort and in the short time available. We can no longer anticipate and predict umpteen possible effects of our products, among them errors. All the more reason to develop and employ extremely fast and reactive tools; these include analysis and problem solving tools. This is only possible for products that are online and use this path to feedback to us what they “experience” and what necessary patches, updates and upgrades have been carried out. The Internet of Things and Data enables us to do just that. That’s why we have to learn how to use our data more effectively. A paradigm shift has already taken place with regard to the transition from prevention to reacting quickly. However, quality management has yet to fully recognize and react to this.

What gets in the way of our reaching the necessary degree of agility is the fact that our management systems as well as our society are both highly over formalized to the point where they are dysfunctional. This leads to employees in companies and supply networks increasingly having to work around regulations in order for anything to work at all. Organization sociologists call this “informal evasive movement in overformalized systems”. This gradually leads to a socialization of rulebreaking, culminating in a useful illegality that is a high risk for companies. In the past years, newspapers were full of examples of this. It’s paradoxical: Without these new tracks around the formal rules, we are no longer able to deliver, but we are always at risk of being discovered and punished. In practice, this is encouraged by large, powerful corporations at the top of the old supply chains using asymmetrical contracts and policies. They exonerate and exculpate themselves by assigning all risks to their suppliers. This is where deception comes into play, as quality honesty is punished severely. Formal systems with their regulations must therefore be managed formally. Examples of such deceptions are FMEAs and 8D reports that describe pseudo mistakes and pseudo causes, yet hide and obscure real connections. The DGQ found a great extent of these elaborate yet meaningless pro-forma applications of mandatory quality methods in a study in 2014. Private discussions with quality managers reinforce this image. Employees cannot address problems they have recognized in their own company, and especially not towards customers and suppliers, as they can then not be solved in a cooperative and collaborative manner. Instead, they face contractual penalties and personal liability. Engineers remain silent, whilst lawyers do the talking. Everyone tries to protect themselves. This does not contribute to quality capability, quite the opposite. But how can we create quality without quality honesty? Many people in companies and supplier networks are frustrated. They do want to deliver quality, but often they neither can nor are allowed to. The results are all around us.

• We have to take action to change this situation. In order to create quality, we need more quality honesty, more personal connectivity and better data connectivity. There are four key approaches for this:
• We must increase our agility and support our most important network partners in doing the same. In this manner, we can improve the generation of customer-focused solutions and iteratively bring these to sufficient maturity.
• We must stop overformalization and drive deformalization, especially when it comes to industry standards for quality assurance and quality management systems. The revision of ISO 9001 in 2015 has already slightly opened the door to more agility.
• We must improve networking and use our data in a better way in order to improve both prevention and fast reactions.
• We must improve how we identify, describe and solve quality problems. As this can only be successful by connecting with one another, we must improve problem solving within the network. As long as we move within the constraints of overregulation and risk allocation, orienting ourselves on the weaker nodes within the network, this will be difficult. One possibility is creating safe spaces for quality-honest collaboration.

DGQ recognizes an opportunity in the BabtecQube. It supports agilization by simplifying and accelerating the collaboration of partners. It supports de-formalization by minimizing its own formality. It supports networking of people and of data. It provides a protected space for bilateral and multilateral quality honesty.

BabtecQube can be the platform where persons who are connected in a customer-supplier network can cooperate in order to actually solve real problems. For Germany, with its highly connected mid-sized sector, this could be an opportunity to increase quality capability and strengthen its position in the global market.