Defects are not free. Somebody makes them, and gets paid for making them.
W. Edwards Deming
To summarize Deming’s teaching on defects, they cost an organization thrice. First, the defect is made, which robs the organization of a “working” product or service. Second, the defect must be identified, which also takes time and resources. Lastly, the defect must be resolved, thus taking more resources away from producing non-defective products and services. If this isn’t bad enough, these costs don’t include opportunity costs which could be mitigated with improvements.
In manufacturing (and IT ;-)), a defect happens because of a quality failure either at the source or somewhere upstream. Once a defect is built into a product, there are two ways to detect it. First, it may be detected prior to shipping. Second, the customer may see the defect, which is significantly worse from a CX perspective. To draw the analogy to lost improvements, if there is no system in place to record improvements, that’s the equivalent of allowing a defect to get to the customer. Lack of improvement causes more technical debt and operational overhead down the line and will be reflected in much of the work that is done by the organization. These defects will be visible to customers, one way or another. How does an organization create a culture of continual improvement?
First, an organization must embrace a culture of improvement. According to ITIL4, a culture of improvement requires three things; transparency, managing by example, and building trust (CDS, 2.3.4, 2.3.8). I’ll treat these three topics in more detail in a future post, but suffice it to say that my perspective is that the former are dependent on the latter – that is, trust is the “coin of the realm” and other aspects of an improvement culture are dependent on it. For example, organizations that have a high degree of trust manifest a corresponding high level of transparency.
Trust is the “coin of the realm” and other aspects of an improvement culture are dependent on it.
Second, an organization must provide mechanisms for conserving, prioritizing, and executing improvement initiatives. Starting with a Continual Improvement Register (CIR) is a good first step. If systems are too proscribed, or improvement processes not defined, team members don’t feel empowered (or able) to record improvement ideas. Without improvement, the organization will continue to produce defects. Making the CIR accessible at all levels of the organization is also recommended. Appointing a small, dedicated improvement person or team responsible for prioritizing and executing on those improvement opportunities closes the loop. Communicating the status of improvement opportunities creates buy-in from the organization and keeps the suggestions rolling in. In my experience, organizations go awry in the second requirement. They may build a culture of trust and improvement, but that culture must be operationalized to realize the true benefits.