What does “quality” really mean? For many, the term implies something that is well made, made to last, and made to accomplish the goal it was initially created for. It’s no wonder then why companies regularly embed the theme of “quality” into the products and services they deliver.
Quality is the lifeblood of business. For this reason, most businesses will have some kind of quality management or assurance system integrated in their operational processes. It’s easy to see why. Exceptional quality performance is linked to higher employee productivity, better cost control, more sustainable business growth, and stronger brand reputation, all of which contribute to a healthier bottom line.
And when commitment to quality is poor, the results are strikingly clear. The American Society for Quality (ASQ) estimates that organizations with poor quality management systems experience, on average, a 15-20% reduction in annual sales compared to quality-conscious peers. This impact is felt in multiple ways – from costly rework and scrap, lower first-time through metrics, customer chargebacks, or consumer recalls, such as those that struck J.M. Smucker in 2022.
Simply put – it pays to invest in your quality management system. In fact, studies show that for every dollar spent on improvements to their quality management systems, firms realize an additional $3 in operating profit, and reduce their costs by nearly 5% of their annual revenues.
If quality management is so integral to business success, then why is it so often siloed?
For many businesses, further investment in their quality management system is materializing as digital transformation projects. Organizations are recognizing the potential value gained from adopting quality management software, enabling them to reduce administrative burdens, streamline processes, enable better collaboration and support more proactive, data-driven decision-making.
Yet, interestingly, the degree of quality management software investment still pales in comparison to other areas of EHS. In fact, while 56% of corporations surveyed by Verdantix in 2022 identified digital transformation of their EHS&Q programs as a key priority, only 47% of firms indicated widespread usage of quality management software, versus 72% using software for incident management, 70% for environmental compliance and 61% for occupational health.
When there is so much proof of the direct impact that better quality can have on critical business metrics, why does investment in digitization of quality management programs continue to lag considerably behind other EHS processes? More importantly – what can we do about it?
What’s preventing organizations from digitizing their quality management programs?
For many businesses, the benefits that can be realized from embracing a digital transformation of quality management practices aren’t all that obvious. Decision makers will always have multiple plates to spin and priorities to manage. If they don’t know the scale of positive impact that can come from digitizing their current quality management processes, they are unlikely to make a change (or even see a need to!).
Resource constraints are also a constant concern for any organization. Leaders always want to know that wherever they apply their finite resources – be they monetary, personnel, technical or otherwise – that they will create a positive return. Investment in quality management programs will often be relegated to the bottom of the pile unless leaders have real-time visibility of signals that indicate quality performance is trending in the wrong direction and can/will result in more harmful impacts down the line. Unfortunately, many organizations fail to act on these early warning signs until it’s too late.
And that leads us to the last core issue: fear of the uncertainty, complexity, time and cost associated with organizational change. Many organizations are stuck in their ways. In turn, many businesses toying with the idea of undertaking a digitization project often convince themselves that the juice isn’t worth the squeeze – that the time and effort needed to adopt software to transform their processes is too much for them to handle, or that they won’t be able to recoup those investments on the other side. While research underlines just how valuable quality management software can be in transforming performance and strengthening the organization’s bottom line, such as one Cority customer’s recovery of $6 million in supplier charge backs – the belief that high costs, lengthy implementation timelines, and the effort to train employees on a new tool are often the most immediate blockers facing many organizations looking for a new way forward.
So, what can be done to abate these challenges? It seems that what’s needed is an approach that keeps things simple, recognizes the need to stay within a reasonable budget, and can be implemented quickly to prove ROI.
Introducing Quality Essentials
Cority’s Quality Essentials package is designed to simplify the cornerstone aspects of our Quality cloud, focusing on the core principles required by organizations to kick-off or refine their digitized Quality Management processes. This approach also reduces the chances of organizations taking on too much too soon – getting the essential functionality up and running without complicating things.
Teams focused on providing data-driven insights will love the streamlined functionality that can help detect early warning signs and act before large-scale recovery is required. The powerful yet intuitive dashboards can help to involve stakeholders from around the organization, accessible anywhere, anytime thanks to mobile workflows.
As with our other Essentials packages, pre-configured features and environments are designed for quick ‘plug & play’, giving organizations simple, intuitive, and user-friendly software that’s competitively priced, rapidly deployed (leading to faster time-to-value), and appropriate for their business while enabling them to grow.
If you’re reading this article – chances are you already know the true value of quality management, digitization, and beyond. You’ll also know that knowledge is power; sharing the statistics, examples, and general theory behind what makes quality management practices so powerful will be what enables your teams to go a step further and enact real change. If you’re interested in learning more, our ‘Cost of Poor Quality’ blog is a great place for further stats, general practices, and more.