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The Business Forum Journal


Perceived Quality vs. Real Quality


By Henry H. Goldman



Recently, one of my neighbors hired a new television/telephone/computer system from one of the nation's largest vendors.  It took most of a day to wire the house to accept the new system.  Widely advertised, the company promises video that is transferable to any set in the house, wireless computers, fax, etc.  The only problem?  It does not work.  Nearly twice a week, since installation in the early spring, one or more service personnel are at the house fiddling with the unit.  They have changed out, multiple times, routers, DVD players, remote sensors, etc.

My neighbor is an entrepreneur who works out of a home office.  He must have uninterrupted Internet access, e-mail and a working telephone/fax.  This had not been the case.  He has no idea of how many calls have been lost, how many messages have not been received and, how many televised sports programs not been accessible. 

We discussed the situation and I asked him why he went with that particular vendor.  He admitted that he was swayed by the advertising and the fact that the firm continues to win awards from J. D. Power for "initial quality."  In other words, he was won over by perceived quality.  But, the fact remains, that there has not been any sign of real quality. 

We see similar examples with automobiles: winners of the Power awards for in entail quality are followed by massive recalls for items that should have been noticed during the manufacturing process, and were not, but the awards continue.  Some years ago, I had a client company that produced electronic equipment.  The equipment was well produced, generally defect free and sold well.  Management saw that the marketplace could contain additional units and increased the number of units sold.  As long as the customer received product that was manufactured during the first two weeks of the month, the product was, in fact, defect free and worked as expected.  However, under pressure to move product out the door, those units produced during the second half of the month did not have the same quality as the earlier pieces.  The rational was that the number  of units shipped had to match the company's marketing plan.  Under that sort of pressure, quality control was lost and real quality failed.  Senior plant personnel shrugged their shoulders, suggesting that it really did not make any difference: the customer would simply return the failed item, customer service would replace it with a working unit and the customers' satisfaction would be retained.  Plus, the failed units would undergo "salvage and re-work," returned to the shipping department and sent, as new, to another customer.

The failure rate continued to climb, as the number of units shipped increased.  Some lines experienced a failure rate approaching ten percent.  Perceived quality dropped as quickly as did real quality.

It required a complete change in production mentality to remedy the problem.  It took a full three months to implement changes, but it was done, and the rate of returned items dropped to near zero.

The quality initiatives in the United States, that now seems to have reached a plateau with Lean Manufacturing and Six Sigma, confuses perceived and real quality (has the methodology become more important that the results that must be achieved by that methodology?)  I addressed that problem with a group of college and university administrators in a Southern California workshop.  One of the participants argued that perceived quality was the major factor influencing students to enroll at that school.  "Real quality," he insisted, "had no meaning at his level (community college); quality was a non-sequitur."  Students at his college enrolled there based on cost and could not care less about the quality of instruction and/or customer service. 

I begged to differ.  Real quality, in any endeavor, is what counts.  Well, while several in the audience did support my position, others simply walked away without comment.  But,  perhaps things are changing.  We purchased a new printer/scanner/fax/copier just last week.  It works just fine and it took very little time to bring it into service.  Our purchase was based on "Real Quality."  We have purchased the same brand in the past, including computers, monitors, etc. all with real quality.  Real quality, of course, leads to perceived quality, so it becomes one eternal round.   

Quality was once described as giving the customer exactly what he or she expects, when it is expected, at a price which the customer expects to pay.  In short, working in a no surprises environment.  These constraints ought to be available to managers in any industry, to profit and non-for-profit, as well as local and national government.  Real Quality must be present, perceived quality should follow, not lead.  Consumer expectations must be fulfilled.  If those expectations are not met, bankruptcy may prove to be a viable alternative.  Recently, we have become disappointed with some Federal agencies squandering tax monies with parties, prostitutes, etc.  We have seen major financial institutions operating without due diligence.  It appears, that in some cases, quality, perceived or real, simply no longer is there. 

Much of what appears above requires a massive realignment of management principles.  That realignment requires that individuals accept the responsibilities for providing goods and services without blemish.  Chief executive officers must be held accountable.  Quality, as a tangible substance, must fall directly to the bottom line.  Real quality mist become a certainty.  As Philip Crosby used to say, "Quality is free."  Crosby wrote that statement in 1979.  It is now 2012, thirty-three years later, and we are still searching.  There are, of course, examples where quality does fall to the bottom line and customer service, in fact, means something.  I just shipped a business package to Berlin, Germany.  I hand carried it to a UPS pickup point.  That was on a Monday.  The package was received in Germany at 08:30, on Wednesday, exactly as promised and as expected.

If my "friend" at the college workshop, as mentioned above, had believed me on the real versus perceived quality, then his college would provide services that were welcomed and delivered to his customers, students, in an atmosphere of collaboration.  The overriding goal being to provide his customers with the highest quality services, including instruction, with early availability and exceptional value.

There are several organizations that today present both "perceived," and "real" quality.  We all know them and we use their products and services.  Let us hope and pray that the quality initiatives of the last quarter of the twentieth century continue through the twenty-first.  Remember, management's integrity must begat quality, both perceived and real.          

Henry H. Goldman is a Fellow of The Business Forum Institute and is the Managing Director of the Goldman Nelson Group.  Henry got his Masters Degree at the University of Iowa and did his Doctoral Studies at the University of Southern California.  He is a Certified Professional Consultant to Management (CPCM); and has published numerous articles in trade journals and was Associate Editor of Taking Stock: A Survey on the Practice and Future of Change Management (Berlin, Germany).  He is a member of the American Society for Training and Development (ASTD); Association of Professional Consultants (APC) and the Institute of Management Consultants (IMC). Henry has consulted and/or offered training in South Africa, Tanzania, China, Hong Kong, Indonesia, Macau, Malaysia, Philippines, Singapore, Barbados, Georgia, Kosovo, Tajikistan, Turkey, Saudi Arabia, the United Arab Emirates and of course North America.  He has also taught at Baker University: Lee’s Summit, MO, 2008, Adjunct Professor of International Business; National Graduate School: Falmouth, MA, 2004-2008, Adjunct Professor of Quality Management; California State University: Fullerton, 2005-2006, Lecturer on Taxation; University of California: Berkeley, 2002, Adjunct Professor of Management; University of Macau (China), Adjunct Professor of Management, 2001-2003.

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