The market is having some fun tormenting quality leaders lately:
Tariff shifts disrupting sourcing models
Supply chain volatility turning reliable suppliers into question marks
Labor shortages exposing every process that depends on institutional knowledge
And through all of it, product recalls are at their highest levels in over five years.
That's why quality is also part of risk management problem.
The question for every executive is whether your quality infrastructure is designed for it or for a more forgiving era that no longer exists. Here are three ways you can think about reshaping your infrastructure for the current environment.
Connect quality outcomes to business outcomes
The organizations pulling ahead aren't the ones with the cleanest audit trails. They're the ones that have connected quality outcomes to business outcomes. They connect the following:
Defect reduction to margin
Customer complaint trends to churn risk
Supplier quality scores to supply continuity
All of these contribute to the cost of poor quality (COPQ), which often amounts to 10 – 20% of revenue. And that doesn’t account for the reputational damage.
When you calculate the numbers for the above, quality stops looking like an overhead cost and starts looking like one of the highest-leverage risk management investments on your P&L.
Connect your quality data across all locations
Most organizations have quality data. What they don't have is connected quality data. Design, manufacturing, supply chain and customer service all generate quality signals. In organizations where this data isn’t connected, problems stay invisible to the people that could prevent them.
Ask yourself the following questions:
Can we trace a customer complaint back to a specific production batch, supplier lot and process step within hours?
Can our quality data tell us where the next problem is likely to emerge before it reaches a customer?
If the answer to either question is no, you’re operating slightly in the dark.
Build resilience before the next crisis hits
People naturally fix what’s broken, which is why the issues that will make the next crisis worse are already lurking within your infrastructure.
Organizations that weather supply disruptions, regulatory changes and market volatility better than their competitors build adaptive capability before they need it. While you might not be able to uncover everything that could go wrong in the future, there are some easy fixes you can make now.
Standardize processes so that they’re followed even when experienced people leave
Develop processes that ensure problem-solving addresses root causes instead of symptoms
Establish quality goals that go from the executive level to the frontline so the whole organization is pulling in the same direction
These tactics require that executives reframe quality and compliance as a strategic capability owned at every level of the organization.
If you're building the infrastructure to compete in a volatile market, we lay out the frameworks for standardization, data-driven decision making, systematic problem solving, organizational engagement and leadership governance in The Quality Leader's Playbook for Operational Excellence.