Quality Organization Transformation

Classic quality work does not meet future customer requirements

“Knowing where the market's going and having the most innovative products is just as much a part of quality as the quality of the construction of the product when you have it” said Steve Jobs in an interview in 1991. Almost 20 years later, most companies still regard quality as a ‘hygienic factor’ to make sure the product is conform to its specifications or that work is done according to safety standards. In the age of digitization, this ‘classic’ quality understanding falls short on several accounts. One example is the way customers are giving feedback. Thanks to social media or mobile ratings, customers can (immediately) inform themselves and others about their experience with product quality and service. Quality departments have to identify issues via new channels and react faster, before a problem becomes viral. Another example is the increasing ‘digital share’ in products, e.g. the electric and software share of total value add in automotive is expected to increase by 50% until 2020. Quality has to be assured for products that become less and less tangible, that are difficult to measure and often have unknown legal risks. Those challenges can only be overcome if the quality organization is transformed to become a central part of the company’s DNA.

Most Q-Organizations have a maturity level somewhere between I and II

Most organizations have established a quality management system and processes to identify and eliminate issues when they occur. Customer feedback is – although not standardized – incorporated into most process steps and on occasion quality works together with R&D and production. What hinders those organizations to progress to level III, is that quality is not internalized and lived throughout the company. Project experience shows that more than 40% of employees are either not aware of a quality strategy or do not understand its implications for their daily work.

To achieve a quality organization transformation (level III), seven quality genes need to be integrated into the company‘s DNA

The seven genes contain the necessary information to achieve customer satisfaction, competitive advantage and low quality defects and costs. If one of the genes is 'damaged' or not sufficiently developed, it will affect the entire company in the long run. Although real value will only be added by the interaction of the genes, each building block has a specific objective or task. The ‘Q-Strategy and Structures’ gene, for example, ensures that the Q-department is aligned for future challenges like digitization and that a unified vision about quality is understood throughout the company. Taking another example, the gene “Client Feedback” is responsible to anchor the voice of the customer in every process step from product design to aftersales services.

Asses your Q-organization’s maturity level and identify optimization areas

To help our clients understand how mature their quality organization is and which part of their Q-DNA might require optimization, Deloitte developed a Quality Maturity Assessment. Within 4-6 weeks, depending on your company size, we assess your maturity level using a questionnaire along the seven DNA genes. This builds the basis for your quality organization transformation. Among others, results include the definition of concrete improvement areas e.g. optimization of quality internal communication. Aside from qualitative improvement, such measures can reach a cost saving potential of up to 400.000€¹ per measure.

^{1) Average cost saving potential e.g. from efficiency increase based on project insights.}

Your Authors

Julienne Mittag
Senior Consultant Consulting
jmittag@deloitte.de