On June 17, 2014, LNS Research and Quality Digest hosted a webcast entitled, "Turning Today's Quality Challenges Into a Source of Competitive Advantage with Closed-Loop Quality Management." Toward the end of the event, we received many questions, several of which we weren't able to address due to time constraints. In this post, I'll speak to the top 5 questions we were asked.
A little bit of background for those who were unable to attend the webcast: drawing upon our research of industry best practices and extensive data from our Quality Management survey, this webcast highlighted the growing importance of closed-loop quality management capabilities in meeting the rising quality challenges in the marketplace today. We discussed topics such as:
- Harmonizing key business process and enterprise applications to close the loop
- Strategies for enhancing closed-loop quality management and quality analytics to achieve predictive decision making
- The current state of closed-loop quality management by industry
- Key metrics for effectively benchmarking closed-loop quality management initiatives
Find the webcast recording here.
Questions & Answers
Q. In quality of service, can you explain what sentiment analysis is?
A. Sentiment analysis is basically getting feedback and responses directly from your customer--or your customers' customers depending on where you are in the supply chain--on their experiences with your products. It shows things like user feedback—questions, challenges, etc.—with the ability to analyze that information on a real-time basis. It's important because, in some industries, waiting to address those things can have a very negative impact on brand and financial situation.
There are sophisticated tools now available in the marketplace that can help companies collect that information with support from strong analytics to make sure customer issues are being responded to in a timely fashion.
Q. Are there any specific benefits for companies selling direct if they adopt closed-loop quality management?
A. We think closed-loop quality has benefits to every organization irrespective of its industry or business model. The concept of closed-loop quality means interconnecting processes and enabling visibility across the value chain through design, manufacturing, the supplier base, and customers. Companies that have invested in these capabilities will be able to better manage the overall quality of their products and processes.
Q. Have you seen any companies use a metric to measure the success of a closed-loop strategy?
A. We have seen companies having metrics in each area of the value chain. For example, if you look at manufacturing you have metrics like yield and scrap. In customer service you have cutomer defects, complaints, and responsiveness. For design you have new product introductions. Similarly, in the supplier side you’ll have metrics like supplier non-conformances, audits, and more. All of these measure performance across the value chain.
However, when it comes to measuring the effectiveness of your closed-loop quality strategy, one of the metrics we have seen companies measure is the Cost of Quality (CoQ) metric. This provides a holisitc viewpoint of the impact of internal and external quality failures and the costs for preventing and resolving those failures.
Q. You mentioned that only 20% of surveyed companies have adopted EQMS. Why do you think the adoption rate is so slow?
A. Traditionally what you see in quality management is that companies have adopted software to address their immediate pain points. So if you have a problem with CAPA, you'll most likely have adopted a CAPA solution. If you have a problem with audits you will adopt an audit solution, and so on.
Second, we’ve also seen the quality function as moving from just that of one department to influencing many functions along the value chain. This has been a driver behind more enterprise-wide solution adoptions rather than point solutions to address immediate challenges.
Additionally, we have to consider the growing availability of robust EQMS systems over the last few years. Now you can find examples of many companies that have implemented a singled EQMS system across multiple sites globally in an effective fashion.
And finally, when you see data about companies planning to implement EQMS system, both adoption and plans for adopting have increased. LNS expects to see this trend continue. We will be writing more about this soon.
Q. How do you see IoT and Big Data impacting closed-loop quality?
A. I’ll give two examples. One is the sentiment analysis part, which we discussed above--this aligns closely to Big Data in quality. And for IoT, I’ll mention having the ability to track quality in the product lifecycle after delivery, and getting better data in the field with connected devices. This will directly impact organizations’ ability to get more product feedback and be more responsive to customer requirements.
For those of you who missed the webinar, you can access an on-demand recording below.