LNS Research Practice Director and Principal Analyst, Dan Jacob details exactly what Quality 4.0 is.
Quality 4.0 is a concept LNS Research first introduced in 2017, and it has been gaining momentum ever since. However, the concept has also picked up some misconceptions along the way. To clear up any confusion, we will redefine Quality 4.0 here and answer several key questions about its scope, value, and role in Industrial Transformation (IX).
What is Quality 4.0?
At LNS Research, we define Quality 4.0 as the application of Industrial Transformation (IX) methodologies and emerging digital technologies to transform quality management and achieve step-change improvements in the value-chain across product development, suppliers, operations, logistics, and customer experience. Let’s take a closer look at the definition.
Application of Industrial Transformation methodologies: Industrial Transformation (IX) methodologies are a proactive and coordinated approach to digitally transform industrial operations by collectively leveraging the power of data, digital technologies, and cyber-physical systems. Quality 4.0, which LNS Research perceives as one of several Industrial Transformation programs in today’s manufacturing companies, is the application of these IX and Industrie 4.0 principles to transform the quality organization.
Emerging digital technologies are one of the most significant enablers of Quality 4.0. Some of these innovative technologies include modern cloud-native quality software applications and platforms, data connectivity, and advanced analytics solutions, etc. Quality 4.0 also leverages other emerging hardware technologies like vision systems, AR/VR, and robotic process automation to transform quality processes like inspection and audits, among others.
Achieve step-change benefits: The goal of Quality 4.0 and other Industrial Transformation programs is to set aspirational goals and achieve step-change improvements in operational metrics, as opposed to the previous generation continuous improvement programs like Lean, Six Sigma, TQM, etc. LNS Research’s recent studies on IX goal setting show that the leading companies are pursuing double-digit improvements in operational and financial metrics.
Across the value-chain: Some of the biggest value propositions from transformative programs like Quality 4.0 arise from integrating people, process, and technology resources across the value-chain. Cross-functional use cases across engineering, manufacturing, maintenance, and external sources including suppliers, customers, etc. play a critical role in achieving the above-mentioned step-change improvements.
What Quality 4.0 isn’t:
Quality 4.0 is not only about technology: One of the most common misconceptions that companies make about Quality 4.0 is reducing it to digital technologies. As mentioned above, Quality 4.0 includes transforming the way quality processes and teams using technology as an enabler are managed and executed; digitizing existing quality processes is not the same as Quality 4.0.
Successful Quality 4.0 programs require companies to identify an executive-level Quality leader with the right expertise, nurture a culture of quality among not just Quality but other teams as well, establish robust change management processes, and not just digitize existing Quality processes as is.
Quality 4.0 doesn’t replace traditional Quality methods, it builds and improves on them. While Quality 4.0 is a new concept, it doesn’t replace existing Quality principles and methodologies like the 5 Whys, Root Cause Analysis, Lean, Six Sigma, Process Control, etc. It is mostly centered around identifying gaps in these existing processes and management systems and digitally transforming them to attain step-change benefits.
LNS Research’s data shows this is one of the significant differentiators between Quality 4.0 Leaders and Followers. Leaders understand that Quality 4.0 builds on ongoing traditional quality and they are funding it through incrementing existing capital expenditure budgets, whereas Followers are instead reallocating budget from other existing initiatives.
Quality 4.0 is not a stationary future state it’s a continuous journey and discipline to achieve business results. LNS Research recommends companies do not consider Quality 4.0 as a one-off project. It requires deeper engagement from not just Quality but several other functions such as IT, Operations, Maintenance, Supply chain, etc. This level of engagement requires significant commitment and cannot be successful within a span of weeks or even months.
As shown in the above charts, Quality 4.0 Leaders are investing more money and time in these programs. Leaders are significantly more likely to be investing more than $1 million and are considering a 5+ year timeline for their Quality 4.0 programs.
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