By David Hutchins, Chairman David Hutchins International Limited
Reprinted from Management Review and Digest first published in 1982.
Note: The red typed material has been inserted recently to put everything in context.
We republish it here on the DHI website in 2006 for the following reason: In the year 1998 there were reported to be more than 20million Circles in China and in every country in the Far East. Both Toyota and Honda announced in 2004 that they are going for 100% involvement in Quality Circles in all of their plants worldwide.
Toyota and Honda are both making huge profits in their manufacturing plants in the USA, China is about to enter that market. At the same time, General Motors are reported to have lost $1.5Bn in the firstsix months of 2004, MG Rover was liquidated and the plant is now owned by the Chinese.
Ford also lost money and Chrysler are currently in deep trouble. Of course it is not all down to Quality Circles, it would be stupid to suggest that it was but they are part of the reason and that is good enough! Why do Toyota and Honda clearly regard the concept to be so important whilst the West completelyignores it? Who is right?
"David Hutchins - 1982
Management interest in the UK in Quality Circles is growing fast. We asked David Hutchins, a recognised authority on the concept, if he could help BIM members by discussing how companies and managers should approach the introduction of Quality Circles. What should they expect from them? How should they be formed? What are the do's and the don’ts?We asked him if he would write a practical article for practicing managers; and he has.
Currently there is something like about 100 to 150 companies in the U K who claim to have Quality Circles. Sadly, for the majority of them, they are unlikely to be able to make the same claim one or two years hence. (This has proved to be prophetic! - inserted) In some cases, failure may be only months or evenweeks away. Even amongst many of those which survive, the chances are that they are unlikely to achieve anything like the full benefits which can accrue from the proper implementation of this exciting concept, which is so new to the West.
The reasons for their failure lie not in any short-comings in the ideas themselves. On the contrary, the concept is so soundly based, that it is reasonable toclaim that, if properly implemented, the Quality Circle Concept should eventually become a way of life for everyone in an organisation. Failures amongst companies, who have taken the trouble to prepare themselves properly before the implementation of Circles, are non existent either in the U K, the United States or Europe.
For them, the prospects are that eventually, they will be so able togalvanise the resources of all their people, that product defects will become almost non-existent. Productivity will go beyond anything even remotely attainable through direct payment by results or other financial incentive schemes, and eventually even product development will be affected.
Fortunately, a few companies are aware of this, and, realising the potential offered by Quality Circles, theyhave taken the trouble to make very careful preparations. These include training, awareness seminars, and for many, a complete rethink of their attitudes towards the people they employ. (Wedgwood in the UK were one of the first to implement Quality Circles and they did it correctly. When the Quality Manager was asked in 2002 (how much have you saved?’ the response was ‘we have no idea, it must bemillions but more important than that, we would not be here by now if we had not done it!’ - Inserted). Failure to realise the importance of any of these points will eventually bring about the failure of' the programme, and as has been mentioned earlier, it is known that many companies have unfortunately already made mistakes.
For example, recently a training officer telephoned the offices of...