Are Quality Awards Worth the Effort?

We've seen a recent rise in interest level among our clients in quality awards, both at the national level (Baldrige in the US and NQI in Canada), as well as at the state level.

Why would already busy companies pursue such demanding awards?

What do they really get out of winning?

To start with, studies have shown that organizations that use a quality award process perform consistently better over time. Here is a summary of one such study (from The Alliance for Performance Excellence website; data from Singhal and Hendricks Study):

Many organizations that use a quality award process as a basis for continuous improvement have achieved :            

• 59% Higher Stock Price
• 111% Higher Operating Income
• 116% Higher Sales
• 114% Higher Total Assets         

If that's not proof enough that these systematic processes are worth the effort, our award-winning clients, as well as those that have just begun their journeys toward performance excellence, all say the same thing: the journey is the prize. There are so many benefits that they derive along the way:

• The pursuit of quality becomes part of everybody's job (which makes the job of the VP of Quality a whole lot more possible).
• Rallying the organization around this common pursuit of excellence yields incredible morale boosts.
• These processes build accountability and predictability into organizations (even for those that were quite chaotic before) in a very constructive way. People understand why they are being measured and why they are being asked about performance, and also feel supported in their efforts to improve.
• The feedback reports from award site visits provide outside validation of current practices, as well as loads of true Opportunities for Improvement (OFIs -- pronounced "Oh-Fees").
• The award is a learning experience for all stakeholders. For governments, non-profits, and healthcare organizations in particular, the public sees a tangible commitment to quality (and improved results). In today's climate of public dissatisfaction and shrinking budgets, these commitments can build public trust that -- often critical to an organization's health.

Of course, these efforts require hard work, senior level dedication, and patience.

Our client, the City of Coral Springs, a 2007 Baldrige Award recipient, for example, first applied for their state award (the Florida Governor's Sterling Award) in 1995. Then they applied again in 1996. They finally won the Sterling in 1997. But their journey was far from complete. They continued to work on their OFIs and in 2003 became the first 2-time recipient of the Sterling. Then in 2006, the City participated in the Baldrige  pilot program for government agencies, during which they received a site visit. Finally in 2007, they won. The trend charts of their results over this 13-year period shows how much more they've achieved than just the awards.

Here is one example. Coral Springs' crime rate (the blue vertical bars) was right at the national average in 1996 (the orange line), but has declined well below that average over the course of their journey. Best of all, they know why this trend has occurred, what the contributing factors are, which aligned improvement efforts have impacted these outcomes, and how to best keep the trend on target.

If you'd like to learn more about your state quality program, here's a good place to start: http://www.baldrigepe.org/alliance/