“Quality is the essence of goodness” by Cirilo P. Noel (Jul 5, 2010)

Business World (07/05/2010)

With the inauguration of President Benigno Simeon C. Aquino III, the Philippine business community is feeling a surge of optimism. This renewed hope — when combined with sounder fiscal and economic policies — augurs well for our country. And in order for change to happen, we need to commit that we are all in this together.

President Aquino’s mandate is a very tall order, but one that is not impossible. We, in business, can do our share by also returning to the tried-and-tested basics of managing our organizations. We can likewise do our own housekeeping, so to speak.

The financial crisis in the recent past has become a very rich source of lessons on management. In a research report, called “A Leadership Prescription for the Future of Quality,” The Conference Board analyzed the major lessons drawn from the financial crisis; these include:

For a company to save money and improve the bottom line, inefficient use of resources needs to be eliminated;

The quality teachings of the 1980s had been set aside but are now being revisited as effective and timeless tools for business improvement;

Many companies assume that quality is embedded in their organization and have taken it for granted, disregarding the fact that quality is actually a complex process that needs constant improvement;

While the business environment has changed drastically, the fundamentals of quality have remained virtually unchanged; and

There is a big role in store for the “quality professional” from managing the back end of a production process to moving to the front end to include the evolving needs of customers.
The report then takes a look at the challenges that the C-Suite would need to hurdle to address the quality issue.

There are four key factors that come into play. First, a global economy poses the question on how best to manage quality across borders and cultures. Second, the advances in technology have resulted in more sophisticated customer demands and expectations. Third, there is a need to manage talent and transfer knowledge from an ageing leadership of baby boomers to a younger generation. Fourth, never before has there been much emphasis on corporate social responsibility such that “doing well by doing good” can help drive bottom-line results.

Addressing how quality can work within these challenges will take much more than locating your company’s quality manual and rereading it.

Recall that most of these manuals were penned 20 or more years ago in the heyday of Total Quality Management or TQM and Six Sigma. While both have remained consistent tools for quality management, there are now other considerations when reintroducing quality in the current corporate environment.

For one, C-Suite members are advised to constantly build up and strengthen the company’s customer intelligence. This means you must always know what the customer or client wants, how you can add value to their business, and more importantly, you need to learn about them faster and with more accuracy. Linked to this is the ability of an organization to improve its operational excellence, creativity, innovativeness, and speed to market. Products and services are now expected to be better, less expensive and made available faster.

There is also much work needed in bridging the gap with a younger generation. In this column just last week, we had described the characteristics of the so-called Generation Y and how they are influencing the workplace and the market. We need to work on building the next generation of customer advocates and working on increasing their elusive loyalty.

Last but not least, leaders need to be open to new competencies, perspective and ideas with regard to quality. A quality leader must change to become a more strategic thinker than a process-driven individual.

That quality is making a comeback is admirable because ours is an organization that imposes quality in everything that we do. At SGV, quality has never been abandoned and is, in fact, a way of life that is ingrained in all aspects of the organization.

Quality of thinking is instilled in every staff member from Day One. We believe that quality begins at the very start — when we are recruiting our people. While most new recruits are diamonds in the rough, we can already spot their potential for leadership and excellence. Through their participation in quality training (for which our Firm is known for), their deep exposure to client work in diverse industries, and given options to pursue higher learning, our people undergo continuous improvement of their skills and competencies. In fact, they become so polished that when they do decide to leave the Firm, they immediately become an asset to their new employer precisely because of their quality of thinking.

Quality is also embedded in our methodologies, processes and systems which are regularly updated and improved. We are all required to learn or relearn the use of global methodologies and other tools in order to remain relevant to all our clients. “Doing it right the first time” has been our mantra for the past 64 years. Quality is intrinsic to our corporate culture, alongside our core values of integrity and excellence.

Of late, there has been so much emphasis on corporate sustainability which is rooted in ethics and governance. There is now a realization that doing good and being good can positively affect profit. Congruently, we can say that quality drives good work and that it begets profitability. When quality is built into an organization, it can weather any crisis because it is the very essence of good work and goodness.

(Cirilo P. Noel is the Chairman and Managing Partner of SGV & Co.)

This article was originally published in the BusinessWorld newspaper. It is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinion expressed above are those of the author and do not necessarily represent the views of SGV & Co.