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Philip Beyer

Systemic Success

By Philip Beyer

About Philip

Philip Beyer realized his calling to business and leadership roles while still in his teens and established his first business in his early twenties. Currently, founder and president of Beyer Printing and Ebiz Products in Nashville, TN, Philip is also a business systems analyst and consultant, author of “System Busters: How to Stop Them In Your Business,” and InterTech award-recipient for designing and developing System100™ business process management software.
 

When Faith Becomes Sight

 
This past week I read an article in PIA Magazine titled, "The Profit Gauge" by Gordon Rivera, about the writings of Phillip Crosby, a quality consultant who has defined quality as "being in conformance to our customer's requirements, which is accomplished by doing things right the first time." EXACTLY! I thought.

As I was trying to decide what to write in this week's blog, Rivera's philosophy gave me much food for thought. That, and the added inspiration of a line from an old 19th century hymn I was reminded of: "When faith becomes sight."

Stay with me...

Rivera wrote, "There is a price to pay when things have to be done over again," and "According to Phillip Crosby, quality is measured by PONC (the Price of Non-Conformance)." Rivera's article went on to say that, since quality is FREE (because you are getting paid for the product or service), then doing something OVER again is what eats into your profits, and is, therefore, the COST of quality.

His formula? If X equals all the cost of doing things right, and Y equals all the costs of having to REDO things...then X plus Y divided by X equals CTR (Complete Transaction Rating). This simple formula measures the cost of making a product or delivering a service.

So, what does this have to do with faith becoming sight? Let me explain...

Many times when I'm talking to business owners and managers about lost profits due to jobs having to be reworked, and the thousands of other non-conformances that happen daily in most businesses, I'm no longer surprised to hear them say, "I don't think we have too much rework!" OR, they take a guess at the amount.

When I ask them if they measure their non-conformances, most say they don't measure; but, say they are pretty sure their guess is accurate.

Now that takes FAITH! How do I know?

In my business—when we first put a system in place to measure ALL of our non-conformances—I was stunned, to say the least, at how much money we were losing on jobs having to be reworked; not to mention the other non-conformances plaguing our company. MY guess was completely wrong, and I was surprised that most of the dollars lost were due to the OTHER non-conformances—i.e., wrong shipments, wasted plates, downtime due to waiting on materials that someone had forgotten to order, etc.

You see, our system for measuring non-conformance took out the guesswork. Our faith had become SIGHT—and with that 20/20 vision, we were able to FIX those non-conformances that had been depleting our profits.

Many times, when suggesting to owners and managers the need for quality control to reduce non-conformances in their businesses, they would baulk at the idea and complain that, "QC Checklists are nonsense and they take too much time!" These same people, who had NEVER measured the cost of non-conformance, really didn't know what price they had paid for bad quality. Consequently, they didn't know the REAL cost of their product or service either.

This approach is BLIND faith! It's also very costly for a business!

Yes, it takes effort to measure quality, and the lack of quality. And yes, it takes even more effort to find the root cause of the non-conformances, in order to stop or reduce them.

However, having spent two decades doing just that, I tell you now, that it's a small price to pay for your sight!

Did I mention? Great systems work!

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