The Quality Gap - QS-9000: Good on paper, but does it guarantee quality?

Andy Herman knows too well what happens when a company makes a half-hearted attempt to meet QS-9000, the Big Three's quality require zment.

Without total commitment from the CEO on down to the newest employee on the shop floor, QS-9000 will not make a noticeable difference in a facility's overall operations, its productivity or the quality of its output.

Mr. Herman spent 30 years tracking supplier quality with General Motors Corp. before his retirement in 1996. Today, his company, A.J. & Resources Inc. in Eastpointe, MI, helps companies in their quest for QS-9000 certification.

"I've seen it firsthand. The owner of a company says, 'This has to be done by Dec. 31. Get it done.' The next person in line says to the person below him, 'Whatever it takes, get it done,'" Mr. Herman says.

"If it's just something that has to get done because of a deadline, then it doesn't get the priority it needs."

But even with deadlines in place, a number of suppliers apparently aren't taking QS-9000 seriously enough.

Most Tier 1 supplier facilities were required to be QS-9000-certified by the end of 1997 (GM's Dec. 31 deadline was the last), but as of Jan. 2, only about half of the 8,000 affected suppliers had gained certification, according to the American Society for Quality (ASQ).

QS-9000 is the Big Three's attempt to have one standardized quality system - as opposed to three in the past - for continuous improvement, defect prevention and waste reduction.

Gaining QS-9000 certification is an arduous task, requiring suppliers to have a written quality manual, written procedures for every plant function and the ability to test the products being manufactured. The first companies to receive certification did so in February 1995. Audits are done every six months to see if a company is following its stated plan.

The requirement to be certified may apply only to Tier 1 companies, but those suppliers have passed the demand down the chain.

After living under QS-9000 for a few years, there is grumbling that certification is not all it's cracked up to be, and that being certified does not guarantee a company is consistently shipping quality parts.

"Some companies have striven mightily to get QS-9000 certification but still are having trouble meeting quality objectives," says one executive from a large Tier 1 supplier in Michigan that already is certified. He spoke on condition of anonymity.

He believes in the intent of QS-9000 and supports it overall. But he says some companies focus too heavily on the enormous paperwork required for certification but fall short when implementing it in real life.

"The reality has not caught up with the standard set with QS-9000. It's not a guarantee of quality at all. It's just a way to show customers what you're doing to attain quality, and there's a big difference there," he says. "People assume that if you're QS-9000 certified, you ship zero PPM (defective parts per million), or close to it. More often than not, it's not the case."

"No one expects zero PPM, but you do expect to see improvement," says David Lalain, quality systems manager for PPG Industries in Cleveland. He is active with the Automotive Industry Action Group (AIAG) in trying to increase the participation of Tier 1 suppliers in quality initiatives.

"You also expect that if there is a system in place, you have a corrective action plan to make improvements," he says.

He points to a 1997 survey by ASQ and AIAG as proof that QS-9000 is indeed leading to better product quality.

Suppliers participating in the survey reported an average 49% decrease in their PPM, a 54% cut in their returns and a 14% reduction in their scrap. The average cost of certification, based on the survey, was about $118,000 per facility.

In their own internal studies, the Big Three also have found lower warranty costs and lower PPM rates for suppliers receiving QS-9000 certification.

"Their metrics are validating that QS-9000 is working," says Tripp Martin, past chairman of the automotive division of the ASQ and the director of quality for Peterson Spring in Southfield, MI.

"Is it perfect? No. They are still getting problems from certain suppliers," he says.

Mr. Martin admits there "has always been a disconnect" between what a company says it does and what it actually does regarding quality. He agrees with Mr. Herman that the long-term effect of QS-9000 certification depends entirely on how committed a company is to the concept.

Everyone agrees that QS-9000 will still be around in three or four years, although it will continue to evolve.

Meanwhile, some in the industry will continue to take a harsh view of QS-9000.

David Guffey, manager of quality assurance and purchasing at St. Joseph, MI-based Vail Rubber Works Inc., views QS-9000 as a "very good outline for a fundamental business system." But it's so bogged down in bureaucracy that he says he wouldn't work for a Tier 1 supplier because of it.

"I still believe for Tier 1s it is overkill," he says. "There are a lot of cost drivers there that do have the potential to drive up cost without the promise of driving down cost.

"The automakers trying to legislate quality is like the federal government trying to legislate morality. It can't be done. I say, let the free market work. If you can't provide the quality that's expected, then maybe your competitor can," says Mr. Guffey.