It is about time that a knowledgeable executive sat down and examined the effect of quality management on the not-for-profit industry. I was delighted to learn that Gary Grobman had done just that and even more pleased when he asked that I write a foreword to the book. He has done a meticulous job of research and has given the matter a lot of thought.
My first exposure to the need for managing quality came when I entered industry at the bottom of an organization. The overwhelming operating concept was that the laws of nature and probability were against any process working correctly. The thought was that variation overwhelmed everything, which is kind of like thinking the sun revolves around the earth. No one thought about the need for quality anywhere other than manufacturing in this regard. I felt that was incorrect and over many years in the workplace, including 14 as vice president of ITT, I developed the ideas and practices of prevention that led to several books and the founding of Philip Crosby Associates in 1979 to teach management and employees about getting things done right the first time.
The first clients of PCA were manufacturing companies who were having problems with foreign competition concerning automobiles, copiers, electronics and such. After a while we began to see insurance, hospitality, and administrative organizations coming to the Quality College. All of them had the same problems; they just had different words for doing things wrong. We had to learn those words in order to help them understand that quality was not goodness, that it was conforming to the agreed requirements; that it came as a result of preventative efforts, not from a system; that the performance standard was Zero Defects, not acceptable levels of quality; and that nonconformance was measured in financial terms, not by indexes. We then helped the management teach everyone else, gave them some tools to work with, and watched them reduce waste and errors dramatically. Most dropped from 25% of revenues to below 5% in a short time. Quality Improvement comes about quickly when management quits making problems for itself.
I was on the Board of Trustees for a hospital and for a college during those years. Whenever I mentioned to those in management that they could benefit from finding a common philosophy of quality the response was that they were not profit-oriented. They felt they were different. Actually they were exactly the same, they just had different words for managing money, like “retained earnings,” rather than “profit.” The thought that people in “for-profit” companies are motivated by the company making money is really not valid. Very few people in the organization understand where money comes from and how to count it. Employees and suppliers are both turned on by the reliability of the organization, not by its cash flow.
Management’s job is to create this reliable organization, and that is what quality management is all about. Most everyone makes it much more complicated than it really is, and turns it into a system of procedures. Actually it is a philosophy of managing that concentrates on having an agenda everyone can understand; requirements that meet the needs of employees, suppliers, and customers; building successful relationships; and having a worldly outlook.
It was the lack of a worldly outlook that kept non-profit organizations from coming to the Quality College at first. Many senior people had the idea that quality was for factories where everything was straightforward. Yet hospitals are factories where many processes are conducted regularly each day and where people work together to make products. A heart bypass operation is a product. In educational institutions, there is a planned transfer of knowledge as well as the managing of facilities and personnel.
Once non-profit managers began to realize this, they took the teachings of our Quality College to heart and caused dramatic changes in their organizations, some of whom are talked about in the text.
We must always be looking for ways to understand our work better so we can become more useful and reliable as organizations and as individuals. Gary’s book will help.
Winter Park, FL