Monday, January 14, 2013

The Cost of (Bad) Quality

I’ve written before (over, and over, and over, …) about what I did for a living before retirement. The condensed version would have only two words: teach, quality. Think how many “blog bytes” I could have saved if I had just pared my writing down to those two words. It really is the essence of what I did in the U.S.N, at A.R.F. Products, and E.T.I., and for almost my entire career at I.B.M.

(Ever notice that I had some kind of affinity for companies with initials. In all fairness, the US Navy was the more common term, but the other three companies that I worked at after the Navy were all about initials. Heck, even as a kid I worked at my dad’s store, the B&H, and at the B.L.M. I did work at the Dash-Inn – my first job. That was before I discovered “initials”!)

In the Navy I worked in a Calibration Lab … doing what? Testing and calibrating electronic test equipment. That’s a sort of quality control job. At A.R.F. I was a test technician. I tested receivers and other electronic equipment by shaking and baking. That is, I tested these devices at 150 degrees C, way over boiling and at -40 C, way under freezing. I also gave them vibration tests. Aerospace was all about lots of testing to assure quality.

(Not that you can test quality into a product … a common misconception. Quality must be built in. Testing just assures that the process is working and provides feedback to correct failures.)

While still working at A.R.F., I began at E.T.I. where I taught. I also taught at Metro, which is called M.S.U.D., at least these days. The “University” and the “Denver” were both added after I left. At I.B.M., I started out testing Series III Copiers. From there I became a manufacturing engineer responsible for the diskette drive testing on the manufacturing line.

Then I joined IBM Technical Education. Although I started out teaching about programming, I was soon teaching testing and software inspection techniques, which is “quality.” I had several other assignments, but ended up the last part of my career as the “Quality Technical Leader” or the “Technical Quality Leader.” (Never sure just what order to put that in.)

My reputation around Printing Systems (PSD) and most of the corporation was as a “Testing Guru.” In fact, that was actually a formal title when I worked with the “Software Testing Interdivisional Technical Liaison” organization. (That’s a mouth full.) That organization eventually became the “Software Engineering Quality Group,” and I represented PSD (more initials) on that group. I’ll save the details about my work on that IBM inter-divisional task group for another note.

My final promotion at IBM was to “Senior Technical Staff Member,” an odd sounding title. Part of an STSM’s job was to evaluate and report on technical directions and help set the technical course of the organization. My focus was quality, and I was sometimes asked to write a detailed report on quality issues. In most cases those were internal quality issues, but one time I was asked to provide an analysis of the quality problems at Toyota. IBM wanted to learn what mistakes Toyota made that led to the difficulties with Camry’s suddenly accelerating.

So I spent several weeks exploring the reports and data available on the issue, how Toyota responded, and what changes they made to their manufacturing and service operations to resolve this serious quality issue. Seemed like Toyota had one of the best quality reputations in the automobile business, and IBM wanted to learn how they had responded to such a serious quality gaff.

Let’s start with Ford Motor Company. Another topic I’ve written about repeatedly is my experience with my Ford Flex. It has been a most positive experience. I bought the vehicle with specific uses in mind. This was my high capacity, creature comfort, road trippin’ vehicle. It’s not a car, but it’s way too nice for a truck. So I just call it the Blue Bus.

One interesting feature of the Blue Bus is the Microsoft Sync system built in. I connected a high capacity iPod to the Bus, and now I’ve got voice command, music on the go with the thousands of songs from my personal library ready, literally at my command: “Play artists The Beatles.” “Yes Master.” The system has worked very well for me, although there is a bug, not fixed, even though I’ve applied a couple of downloaded updates. I can be playing a selection type, like an artist or a genre or a playlist. If I shut off the Bus, then, when I turn it back on, the Sync system just plays the last song over and over. Or, sometimes, the last album, over and over.

There is one more update available, but it requires the dealer install it, and I’ve not done that, what is likely expensive, visit to the shop.

The Ford Motor Company began adding touch-screen control systems to some of its most popular models two years ago as a way to stand out from the rest of the industry and draw in new customers. “MyFord Touch” replaces many of the traditional knobs and buttons in a vehicle with touch screens, steering wheel-mounted controls, and spoken commands.

But after many buyers grew frustrated with flaws in the system, developed with Microsoft, Ford's quality ratings plunged, and a feature meant to increase loyalty instead damaged perceptions of the company.

Now Ford has issued a major upgrade that redesigns much of what customers see on the screen and tries to resolve complaints about the system crashing or rebooting while the vehicle is being driven. Fonts and buttons on the screen have been enlarged, and the layouts of more than 1,000 screens have been revamped.

Ford is taking the unusual step of sending the upgrade directly to customers, who can install the new software in about an hour by plugging in a USB flash drive.

Now my older vehicle does not have the touch screen of the “MyFord,” so this issue didn’t affect me personally. However, according to Consumer Reports, this problem is a major reason that Ford dropped from fifth place in their “Automaker Report Card” to tenth. Ford dropped ten places in the publication's predicted reliability survey last year and plummeted to 23rd place, from 5th, in the most recent initial quality survey by J. D. Power & Associates. Both surveys showed poor scores for models with “MyFord Touch.”

Ford has been among the industry's leaders in introducing communication and entertainment technology in recent years. Rivals like General Motors, Chrysler, and Toyota have been adding similar features, though they are generally less complex and have not generated as much negative feedback.

Ford's system incorporates the car's climate controls, hands-free communication, navigation, and entertainment into one screen on the console and has another customizable display where the speedometer and other gauges are usually located.

Ford insists it is committed to the touch-screen approach and that customers love it, aside from the issues targeted by the new upgrade. It said “MyFord Touch” and its underlying software, were an important part of the purchase decision for 56 percent of Ford buyers, and that 77 percent of owners now used voice commands to control their vehicle's audio and information system.

Many of the issues were with the user interface. One problem is that the interface was just too complicated for a mobile environment. That makes me wonder about safety issues by distracted drivers trying to adjust their heater. On the positive side, Ford has taken concerted actions to correct this problem. A better response than the one they had when they learned that Pinto gas tanks exploded when the car was struck from behind. Ford seems to have finally learned the quality lesson. Certainly I’m happy with the quality of my Ford product, and that includes how I’m treated at the dealership.

I suspect that IBM was not the only company studying the success of Toyota’s quality focus. Let’s move on to a company well known for their quality as well as their easy to use interface: Apple.

I think no company has made more money from creating quality products that are sold at premium prices than Apple … well, maybe Mercedes Benz or Rolls Royce too. But my personal experience with Apple, both as a user and as a developer, is that their focus on quality of experience, quality of design, and quality of manufacturing is top notch.

I have some serious issues with their products’ maintainability. That’s how easy they are to fix. But, if they never fail, then that’s not an issue. (They do fail, occasionally, however, so this is a concern of mine.) Sometimes it is a tradeoff where higher battery life can be obtained from a soft packaged battery, but then the battery must be glued into the device making replacement very difficult. In other cases it is the esthetic goal of super thinness that leads to iMacs that are almost impossible to open up for repairs.

But when it comes to quality in general, Apple leads the entire personal computer industry, and is well rewarded, specifically for that quality and ease-of-use, by its adoring fans.

This Apple focus on quality came top-down, from the founder and CEO, Steve Jobs. Sadly, he is no longer here to provide that quality focus. From the Apple Store to the lowliest Apple product to the top of the line machines and software, Apple is well known for “fit and finish” and products that “just work.”

Not that there haven’t been some hiccups, even when Jobs was in charge. Who remembers the “MobileMe” fiasco? Apple had updated from DotMac to a new Internet connected service called MobileMe. Following the trouble filled roll out of the new service, users found they could not access their data, their contact list, their email. Apple eventually fixed the mess, and Jobs chewed out the entire team for embarrassing Apple. Heads rolled. (That means executives were fired.)

More recent problems are the poor initial performance of Siri that even led to YouTube parodies and the latest problems with the new Apple Maps App on mobile devices. Again, heads rolled.

Apple fired Scott Forstall, the long time Apple executive and head of iOS development last year. Many assume it was due to the failures of Siri and Apple Maps.

John Browett, recently hired to lead the Apple Stores, was also let go after only one year on the job. One of the issues was mismanagement at their stores, the cutting back of cleaning staff, tighter Genius Bar bookings, and other cost-cutting, revenue-boosting measures. Usually, cost savings gets you promoted in corporate America. This is a happy exception … at least happy to me, the Quality Guru and Apple Fan-boy. Customer response and quality trump budget cutting at Apple.

It has been my experience that a focus on quality must always exceed the desire to ship the latest function on time. For too many development organizations, “schedule is king.” As I’ve said many times, and I didn’t invent this, “The bitterness of poor quality lasts long after the sweetness of meeting schedule is forgotten.” I know there is tremendous pressure to ship a product on schedule, and there are good business reasons to make a planned date, but quality must come first.

Even a first-rate company like Apple seems to require relearning of that lesson on occasion. The good news is that Apple did learn and made changes as needed. That’s why I’ll keep buying their products.

As a software development project manager, I insisted that all functions be fully tested, and I would remove a poor function rather than ship it, even if it was considered critical. If it wasn’t ready for prime time, or, possibly due to last minute changes, it had not been thoroughly tested, then it was not included. Quality was more important. As the Quality Technical Leader, I made that the rule for the entire division.

(We had the benefit of the ability to add the function later in an update. Since our big systems were multi-million dollar installations, and our service staff visited all our customers every month, these updates were not as big of a problem to implement as updating code in an automobile. That helped me hold the line on “not ready for prime time features.”)

I implemented a Final Quality Review process and insisted that the development leader convince me (and the Vice-President of Quality) that the product was ready, rather than requiring the test leader convince us it wasn’t. One part of that process was a form that required a signature by the development manager, test manager, and quality manager before the product could ship. Something about the personal touch of a signature tends to get people’s focus. What was funny is that the form was actually a PowerPoint presentation and so the signature page was always printed off and signed. It was then scanned into the permanent computer records of the project. The old-fashioned “John Hancock” approach raises the stakes of approval in a subtle way, and was both very successful and participants noted how it made them be much more certain in their decision.

The result was a continual improvement in product quality measured by defects found in the field. The much more important result was the high level of customer satisfaction and lower maintenance costs that were the result of this focus. Note that it wasn’t the final quality review that improved quality. It was all the preparation for that final review and the knowledge that the final review would be required. It literally changed the development culture to focus more on quality. And I wasn’t even the CEO??

These are lessons that corporations ready for the twenty-first century have not just learned, but made part of their DNA. No one knows exactly why the dinosaurs became extinct. My personal view is that it was from poor quality and customer complaints.

Let me close with these thoughts. This is how I see the future. This would be my advice to IBM, or Toyota, or Ford, and Apple. Quality matters more than everything else: Customer satisfaction stems from quality; Manufacturing efficiency comes from quality; Budget management improves with good quality ... all these positive results come from a focus on quality.

Imagine a Company that did not think of Quality as an attribute of a Product or a Process, but as an attribute of the Company itself. That the Company provided Products and Services that their Customers could rely on as Quality Products and Quality Services.

Assume that the Company itself saw this as an overall goal for continuous internal improvement. One would think that having such a goal and achieving the same would have an intrinsic benefit and a long-term competitive advantage.

Now, imagine the reverse where Companies compete based purely on the minimum effort and cost to deliver a given Product or Service to the marketplace regardless to how the Product or Service is perceived.

One would think that the simplistic application of the laws of Economics, especially in difficult times, would tend to favor the latter strategy rather than the former. In other words, low cost would be the deciding factor.Yet Apple prospers in good times and bad.

Of course, some companies try to have both. Be the low cost, high quality producer. The problem is that “quality” quickly becomes the victim of the low cost. You have to have a long-term view to realize that great quality actually saves money.

One issue I have with the stock market and investors in general is too much focus on the short-term and too little focus on the long-term. Successful companies know better. By a long-term focus, the short-term takes care of itself. Is our short-term focus preventing us from realizing the long-term advantages of QUALITY? How can other businesses ignore the lessons of Apple and other companies that put quality and customer experience first? It’s a mystery to me!?!

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