Zero defects success stories

Nelson Nameplate Co. of Los Angeles manufactures membrane switches, nameplates, graphic overlays and lenses. It’s been in business since 1946 and has earned a well-deserved reputation for quality processes and products.

“We believe that all work is a process,” says Tom Cassutt, co-president of Nelson. “By eliminating the possibilities of error in a process, we achieve continuous improvement and move closer to our goal of obtaining zero defects.”

Nelson was introduced to the concept of zero defects in the late 1980s, when co-president David Lazier first read Quality Is Free. Soon thereafter, the company made zero defects the goal for its manufacturing and delivery processes. Before implementing what Nelson calls its quality improvement process, the company meas-ured delivery performance by analyzing the percentage of backlog that was past due. Now, with zero defects in mind, management has established the goal of shipping each of 12,000 annual jobs on time. “We still haven’t achieved zero defects in this area, but every Nelson employee knows the goal of shipping on the exact date planned and is working toward meeting this goal as part of our commitment to continuous improvement,” says Cassutt.

Adopting the zero defects philosophy has had some impressive results for Nelson. The company has tracked its cost of quality on a monthly basis since February 1990. During that time, its cost of quality has decreased from 27 percent of sales to 16 percent of sales. The cost savings led to more competitive pricing and helped pay for the brand-new 117,000 square foot, state-of-the-art facility that Nelson moved into in October 1999. Clearly, the emphasis on zero defects is working for Nelson Nameplate.

Others have demonstrated similar successes by bringing zero defects into their companies. CarboMedics Inc. of Austin, Texas, is a medical device manufacturer that specializes in heart valves. If ever there was a manufacturing process that demanded zero defects, this would be it. In its publication, the In-Plant Newsletter, Terry Marlatt, president of the company’s Cardio Prosthesis Division, relates the company’s journey to excellence using zero defects.

“Since December 1997 over 300,000 CarboMedics prosthetic heart valves have been implanted, with no reports of any post-implant mechanical failures. This is a record every manufacturer of mechanical valves is envious of,” writes Marlatt, in the article “300,000 Heart Valves With Zero Defects.”

CarboMedics’ senior managers made zero defects their priority after a lengthy debate over whether perfection was a realistic, achievable goal. But the objective was not perfection as an abstract principle but complete fulfillment of customer requirements every single time. “What is abstract about clearly understood customer requirements?” asks Marlatt. “It’s reasonable to expect us to meet customer requirements perfectly. 300,000 implants with zero mechanical defects is fact, not fantasy. This performance is in line with our quality policy and embodied in our quality statement: ‘CarboMedics Inc. will provide products and services that conform to customer requirements the first time, every time.’”

The number of heart valves that CarboMedics has implanted without mechanical defects now exceeds 500,000--and counting.

A perspective from Deming
In his book, Out of the Crisis (Massachusetts Institute of Technology, Center for Advanced Engineering Study, second edition, 1986), renowned quality guru W. Edwards Deming took issue with the concept of zero defects, deriding it as an example of management sloganeering with little meaning for the worker on the shop floor. Part of Deming’s argument stems from the idea that rating workers is nearly impossible--even if a bottom-line measurement such as defects is used.

As proof, Deming offered his now-famous red bead experiment, in which he filled a large vat with 4,000 beads--20 percent red, the remainder white, all mixed together randomly. Each of six people (workers) puts on a blindfold and draws 50 beads out of the vat. The challenge is to draw out only white beads, which represent “good” products that will be accepted by the customer; red beads are considered as defective products that will be rejected.

Not surprisingly, the six workers had a large variance in the number of red beads drawn--anywhere from four to 15. It’s easy to see that rating workers in this way is foolish. If a process has a 20-percent failure rate built into it from the beginning, worker competence is not the issue. If some workers happen to select fewer defects out of such a flawed system, that doesn’t necessarily point to their skill. By the same token, workers who have more defects aren’t necessarily inferior to their colleagues. Applying statistical methods to these figures, one finds that the upper and lower limits of variation in this case would be 16 and one, respectively. Thus, in this case, all six workers would fall within the control limits of the experiment.

Deming’s red bead experiment is meant to show the fallacy in judging workers in terms of defects, but in a larger sense, it points out the higher ground that Deming and Crosby both occupy on this issue. Simply put, it’s all about management. Workers may assemble the parts or staff the call centers, but they’re not ultimately responsible for the overall quality direction of the enterprise. It’s incumbent upon the leadership to create processes that work and result in quality products and services.