GE Capital
Managing quality: Begin with your customer
viewpoint
GE Capital
Managing quality: Begin with your customer
Globalization and instant access to information, products and services have changed the way your customers
conduct business. Old business models no longer work, and today’s competitive environment leaves little room for
error. Companies must delight customers and relentlessly look for new ways to exceed their expectations. This is
why companies need a quality management system incorporating organizational structure and responsibilities,
standard processes and continuous process improvement methods like Six Sigma and Lean.
Quality management can be a strategic asset as long
as it is aligned with the objective of elevating your
customer’s experience. GE believes quality is driven
primarily by the customer, as opposed to being generated
solely from within the four walls of the company. As a
holistic undertaking, your quality management initiative
will demand that your employees work together across
boundaries to improve processes and decrease variation.
Managing quality: Begin with your customer
Key elements of quality
In GE’s view, there are three key elements of quality:
customer, process and employee.
Customer
If you do not delight your customers, it will be impossible
to thrive in today’s competitive environment. Customers
should be the center of your universe: Their requirements
and needs define quality. Customers expect performance,
reliability, competitive prices, on-time delivery, service,
clear and correct transaction processing and more.
In every attribute that influences customer perception,
being “good” is not enough. Rather, “delighting” customers
is a necessity, because in this marketplace if you don’t
do it, your competitors will.
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GE Capital
Quality is defined by the customer
Customer’s View
of GE’s Contribution
A
B
C
Customer
Process
GE’s Process
GE’s View
of Its Contribution
Process
Quality requires looking at your business from the
customer’s perspective, as opposed to taking the
organization’s viewpoint. In other words, it is
necessary to look at your processes from the
outside in. By understanding the transaction life
cycle along all of your customers’ touchpoints,
you can discover what they are seeing and
feeling, while also understanding their needs
and desires. With this knowledge, you can then
identify areas where you can add significant
value or improvement from their perspective.
Employee
People create results. Involving all employees is essential to your organization’s quality approach. Aim to provide
opportunities and incentives for your employees to focus their talents and energies on satisfying customers.
At GE, many of our employees are trained in the strategy, statistical tools and techniques of Six Sigma quality and
Lean process improvement. For example, we offer training courses at various levels:
Removing process variance and waste
Traditionally, companies viewed and measured their
business performance from the inside out, relying on
average- or mean-based measures. The problem with
this approach is that customers don’t judge companies
on averages—rather, they feel the variance in each
transaction or product shipped. So, your continuous
process improvement initiative should focus first on
reducing process variation and then on improving the
process capability via Six Sigma. Eliminating or reducing
waste as much as possible via Lean principles is
another pillar of our quality management system.
Working together, Six Sigma and Lean promote the
consistent, predictable business processes that deliver
customers world-class levels of quality.
Six Sigma for
defect elimination
• Quality Overview Seminars: Basic Six Sigma awareness.
• Team Training: Basic tool introduction to equip employees to participate on Six Sigma teams.
• Green Belt, Black Belt and Master Black Belt Training: In-depth, quality training that includes high-level statistical
tools and basic quality control tools.
• The CAP (Change Acceleration Process): Creates a model for increasing the acceptance and effectiveness
of change.
• Design for Six Sigma (DFSS) Training: Prepares teams for the use of statistical tools to design it right the first time.
Return on your quality investment
In our experience, a world-class service organization can expect to spend 1% of revenues on its quality function.
A manufacturing company, meanwhile, will typically spend 3% to 4% of revenues on quality management. The return
on investment for this funding comes in the form of cost avoidance. At GE, we expect to achieve cost avoidance of
about three times the quality group’s budget, and we measure this return in terms of avoiding the need to increase
our human resources budget.
Lean events and
projects for cycle time
and waste reduction
Managing quality: Begin with your customer
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GE Capital
Key takeaways
To survive and thrive in the marketplace today requires that your company infuse quality into every aspect of its
operations. It is no longer sufficient to release a “high-quality” product or service offering and trust that it will find its
market. The concept of quality needs to start with your customers—what they value, need and wish for. This is counter
to the traditional inside-out approach to quality.
At GE, there are three essential elements of quality:
• Customer. Even if you are doing everything else perfectly, if you are not delighting your customer, none
of it matters. The very existence of your company will be in jeopardy if you only satisfy rather than delight
your customers.
• Process. Every process in your organization should be examined for potential improvements—not just once,
but on a continuous basis. Processes that touch customers are particularly critical.
• Employees. There is no quality customer experience without your employees. Employees deliver your experience
to customers—as such, they need training on how to perfect processes. At GE, employees receive training on the
Six Sigma and Lean methodologies for process improvement.
Aim to cost-justify your quality effort on the basis of cost avoidance. However, quality is its own reward, for it is a
bedrock of your customer’s experience. If you fail to deliver quality, it is only a matter of time before your customers
defect to a competitor. The reality of today’s business world is that it is not enough to meet customer expectations—
you must strive to continuously exceed them.
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Managing quality: Begin with your customer
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