By Marg Latham, P.Eng.
Effective Quality ManagementCompanies & People Engineering
A frequent comment from those faced with implementing a new quality management system, especially one that is to be certified under ISO 9001, is that it will be too costly. It is true that an investment is needed to develop and introduce a...
A frequent comment from those faced with implementing a new quality management system, especially one that is to be certified under ISO 9001, is that it will be too costly. It is true that an investment is needed to develop and introduce a quality management system (QMS) where none exists or to improve one that is ineffective. However, that investment should more than pay for itself if it is made wisely.
To be a successful consulting engineering firm you must be delivering solutions that your clients value. How satisfied are your clients and how effectively are you delivering your services?
If you do not know the answer to these questions, your quality management – or lack of it – may be costing your firm business and profitability. Lost opportunities and clients, a damaged reputation, project write-downs, reduced profit margins or costly claims could all result from not effectively managing the quality of your work.
Digging deep for root causes
Start by finding out how your clients perceive your firm’s performance. Meet with clients. Ask open ended questions. Use a standard set of questions about performance issues so that you get some consistent information. Find out how you are performing in areas that are important to your clients. Capture exact quotes. Be sure to ask your clients how they rate your firm compared with your competition and why.
Then review the information you capture from these interviews and look for trends. Are there common themes that identify areas to investigate or improve?
What else will tell you where to invest in better quality? The answer lies in areas where poor quality is currently having a negative impact on your profitability. Review project financial reports. Assess whether your projects are achieving planned profitability. Identify common themes such as the types of projects that regularly fail to achieve profit goals, and identify project managers with poor track records.
By the time you have completed your review of the client and financial data, you will likely be seeing some common themes that flag areas in need of improvement. However, these trends at a macro level will not necessarily tell you what to change to improve your quality. You need to dig deeper. What are the root causes of these trends? Look at some projects that reflect the problems identified in the client interviews and financial results and conduct a root cause analysis. Conducting this type of analysis on a sample of your problem projects will give you a good sense of where to start to improve.
Proposals; design reviews; managing the scope
I was asked by a transportation sector leader to help identify why his group was experiencing significant project write-downs. I worked with him to facilitate a series of root cause analyses on a sample of problem projects. We found that the majority of the problems began with a poor proposal process. Many of the proposals did not include a detailed task list and did not document assumptions made to prepare the proposal. This meant that during the project it was difficult to identify and be paid for out-of-scope work. Improving the proposal process could resolve over half of the problem projects. The analysis also indicated that most of the remainder were related to inadequate interim reviews that caused costly rework. Focusing on improving these two areas reduced the project write-downs and provided an immediate return on the investment spent on improving procedures.
In another instance, a review of claims and client complaints indicated issues related to design reviews. A root cause analysis showed that teams were not confirming all design inputs and not reviewing input data to confirm that it was current, accurate, complete and adequate for the design. By adopting a simple process and recording problems, the department dramatically decreased the incidence of claims and complaints within two years. In comparison, in the two years prior to the process change there were a number of claims with potentially high settlements for work completed.
In a third instance, concerns were raised about the ability of project managers to manage effectively the firm’s scope of work on projects. It would have been easy to blame the project managers. However, an assessment determined the need for some specific project management training, which was implemented using an outside provider and resulted in the same project managers doing a much better job.
Monitoring the results
Putting effective quality management in place should not be costly, nor should it handcuff competent professionals. Finding the root cause of costly poor quality problems will provide you with the focus for implementing initial quality management controls. How much effort and controls you decide to put in place in other areas will depend on the level of skill of your professionals and the risk to the firm.
Once in place, a quality management system must be monitored for improvement. Effective feedback systems and metrics can be used to identify what is working well and where improvements to the system are needed. Auditing to confirm that employees are complying with the QMS is a way of helping to embed the use of the necessary processes, and when it is coupled with an ISO 9001 certification, auditing can have added benefits. cce
Marg Latham, P.Eng. is president of Aqua Libra Consulting in Vancouver helping companies deliver business development programs. She was a vice president with UMA/AECOM Canada from 2000-2009.