1. 1
Quality and Innovation
June 20, 2013
Juhani Anttila
International Academy for Quality (IAQ)
Helsinki, Finland
juhani.anttila@telecon.fi , ww.QualityIntegration.biz
These pages are licensed
under the Creative Commons 3.0 License
http://creativecommons.org/licenses/by/3.0
(Mention the origin)
2. 2
xxxx/21.11.2009/jan
Quality and innovation as business management disciplines:
1. From discrete evolution to organizational integration
2. Innovation, a tradition in quality management
3. Innovation measures aim at quality
4. Innovations in technology, products, and quality management
5. People as the primary source of innovation
6. Quality and innovation integration
7. Organizational learning for innovation in quality and quality in innovation
8. Conclusions
Quality and Innovation
4. 4
Quality
Quality and Innovation: Disciplines for the benefits of
organizations and society Evolution and realization
3984/3.3.2013/jan Innovation
Shewhart 1924
Ichikawa 1962
Feigenbaum 1945
Deming 1947
Juran 1935
Modern
quality activists
Tarde 1903
Role model
organizations
Great inventors
Modern technological
inventions
Schumpeter 1939
Technological innovations
Rogers 1962
Social innovations
Intellectual Property
Rights
Collaborative
innovation
The disciplines have evolved in isolation
from each other.
Quality and innovation are realized for
the benefits of organizations and society
There are only few substantial cross-
references between the disciplines.
Global, national and
regional movements
Ancient quality
achievements
Ancient innovation
achievements
National and regional
movements,
ISO standardization 1979
5. 5
Relationships of quality and innovation
in theory and practice?
3990/3.1.2013/jan
Discipline’s
evolution
Contentual
relations
Integration
in businesses
An organization’s
business management
Q Q QI I I
Contentual elements of the disciplines (quality & innovation)?
Quality management & Innovation management?
7. 7
What is QUALITY all about?
The concept quality is according to the
standard ISO 9000 associated with the
following things:
– Item to be addressed from the quality
point of view
– Inherent characteristics of the item
– Degree that the item possesses
particular characteristics
– Fulfillment – requirements
characteristics
– Requirements - needs and
expectations, general / specific, stated
/ implied
– Interested parties(*) related to the item
In the relationship with the interested parties,
quality is for :
– Win / Win operational principle
– Satisfaction, net value to all parties
In competitive business environments, the
degree requirement is:
– Excellence
Non-Quality includes:
– Defect – non-fulfillment of the needs and
expectations
– Nonconformity – non-fulfillment of the
stated requirement specifications
2482/17.4.2013/jan
”degree to which a set of inherent characteristics fulfils requirements”
(*) In general interested parties of an organization include customers, owners, people in an
organization, suppliers, bankers, unions, partners, society, etc. This gives a very wide
meaning and coverage to the quality concept.
8. 8
The pursuit of WOW!
- T. Peters 1994
”...stepping out (individuals at all level in a firm and independent
contractors) and standing out (corporations and other
organizations) from the growing crowd of look-likes...”
0014/26.3.2013/jan
In search of excellence
- T. Peters 1982
A passion for excellence
- T. Peters 1985
Striving for excellence
(*) Tom Peters
INNOVATION
REQUIRED!
9. 9
Innovation is an old tradition and a new challenge
in quality management
3989/3.1.2013/jan
Quality (in an organization’s business connection) =
• degree to which the organization’s products (goods and services) fulfill
requirements of the customers and the market place (ISO 9000)
Organizations compete with each other by the quality of their products and efficiency
of their operations. In order to be successful, organizations must be responsive to
changing market situations and strive for distinctively outstanding and excellent
products in an efficient way. In quality management this has been solved through
applying continual improvement methodologies with innovations in the products and
business processes.
Hence, innovation is not any new subject in the quality discipline but it has inherently
been in professional quality practices already decades.
• However, we have not got much innovations in the quality methodologies. This
is a crucial challenge to the quality professionals.
10. 10
Innovation in the ISO 9004:2009 standard for the
sustained success of an organization
3985/3.1.2013/jan
The sustained success of an organization is demonstrated by its ability to satisfy the
needs and expectations of its customers and other interested parties, over the long
term and in a balanced way. This can be achieved through
• Awareness of the organization's environment
• The effective management of opportunities and risks
• Learning from experience
• Application of improvement and innovation
Innovation can be applied to issues at all levels, through changes in
• Technology or product
• Processes
• The organization
• The organization's management system
In the context of quality management, innovation is linked with improvements and
organizational learning.
11. 11
Fundamental concepts, core values, and
principles for good management
3009/3.4.2013/jan
ISO 9000 – Quality management principles:
• Customer focus
• Leadership
• Engagement and competence of people
• Process approach
• Improvement
• Informed decision making
• Relationship management
EFQM - Fundamental concepts:
• Adding value for customers
• Creating a sustainable future
• Creating organizational capability
• Harnessing creativity & innovation
• Leading with vision, inspiration & integrity
• Managing with agility
• Succeeding through the talent of people
• Sustaining outstanding results
Malcolm Baldrige - Core values and concepts:
• Visionary leadership
• Customer-driven excellence
• Organizational and personal learning
• Valuing employees and partners
• Agility
• Focus on the future
• Managing for innovation
• Management by fact
• Social responsibility
• Focus on results and creating value
• Systems perspective
Each organization defines its good
management principles from
organization’s own business point of view.
These general principles may help
organization in this task.
12. 12
Innovation is a central topic in the performance
excellence models (Example Malcolm Baldrige model)
4047/2.2.2013/jan
Innovation ensure the organization succeed now and in the future:
• The opportunities that affect the organization’s competitive situation include
innovation and collaboration.
• The key elements of the organizational performance improvement include
evaluation, organizational learning, and innovation processes.
Requirements for innovation:
• Technological and organizational innovation in products, operations, and the
business model
• Rate of innovation and rapid innovation
(Ref.: Malcolm Baldrige criteria)
13. 13
Forces of change - Shaping the future of quality
1. Global responsibility
2. Consumer awareness
3. Globalization
4. Increasing rate of change
5. Workforce of the future
6. Aging population
7. 21st century quality
8. Innovation
The sixth future study of the American Society
for Quality in 2011
3986/2.1.2013/jan
Emergence to the future
Quality profession is striving for
broader scopes:
Production process (1924)
Quality system (1987)
Quality management system (2000)
Business ecosystem (2010)
Preferred scenario: “Resource restoration”
Creating implications to quality concept, organizations, and the quality profession as a whole
15. 15
All innovations are for quality improvements!
3991/3.1.2013/jan
There are no internationally standardized definition for the concept innovation.
In most cases innovation means a conceptually new and commercially viable solution in
products, processes, business systems, and technologies, or a new solution that is readily
available to markets, governments, and society.
In simple words, innovation means improved quality.
All business innovations directly promote the basic intentions of quality management to
improve product performance, increase the efficiency of business processes, and make
possible organizations’ radical structural and operational transformation and reforms.
All these topics are basic intentions of the professional quality management.
16. 16
Innovations for unique business solutions
What are innovations about?
1804/2.1.2013/jan
What
How
New
New
Old
Old
Innovations are for improving the
performance of products, and
business structures and processes.
From organization’s performance
point of view “How” is more important
than “What”.
I1 I2
I3Old
17. 17
Conceptual elements of innovation
3982/3.1.2013/jan
Historical conceptions of innovation:
1. Imitation 2. Invention 3. Discovery 4. Imagination 5. Ingenuity 6. Cultural change
7. Social change 8. Organizational change 9. Political innovation 10.Creativity
11. Technological change 12. Technological innovation 13. Commercialized innovation
The Vocabulary of Innovation:
ACT SOURCE EFFECTS
Imitation Inspiration Culture
Invention Ingenuity Civilization
Discovery Curiosity Evolution
Experiment / Investigation Imagination Modernity/Progress
Initiative Reason (logic) Advancement
Praxis/action Improvement
Change Development
Creation/Creativity Revolution
Production
Novation / Innovation Novelty
(Ref.: Benoît Godin)
Quality aspects are here implicitly included.
18. 18
World-wide innovation movements
4048/3.1.2013/jan
Global contributions to innovation:
• OECD, The Organisation for Economic Co-
operation and Development
The contribution of innovation to
economic growth and well-being
• WIPO, World Intellectual Property Organization
Annual World Intellectual Property Day
(April 26)
Promoting innovation and creativity for the
economic, social and cultural development
in all countries
Celebrating the contributions made by
innovators and creators
Ensuring intellectual property (patents,
copyright, trademarks, designs, etc.) as a
means of stimulating innovation and
creativity
Regional innovation movements
• EU: The Innovation Union, Horizon 2020
Boosting research and innovation in the
member states
National innovation movements and systems
• USA, Finland, Estonia, China, India, etc.
National innovation strategies and policies
Understanding the role of large scale
innovation movements:
• Primarily the movements focus on
research and product and technology
development, industrial R&D
(improved products and processes),
and on the intellectual property rights
(IPR).
• A national innovation system is not
any system (or it may be only political
rhetoric), but a concept for an
emergent network of various
independent actors (public or private).
• Real innovations are created by
independent individual inventors and
organizations or through their
collaboration in networks.
• There is no remarkable collaboration
between quality and innovation
professionals in these movements.
19. 19
Example:
Innovate America
Global, national and regional movements
implicitly underline quality aspects
3987/3.2.2013/jan
Although there are much
quality aspects emphasized
in these programs, however,
typically quality experts
have not been involved
with these activities.
21. 21
Product and technology innovations
in quality management
3992/3.1.2013/jan
A competitive product quality (product excellence) is based on technology and product
innovations.
In quality management, this is a crucial issue in managing the business processes related with
(ISO 9004):
- product realization
- acquisition of new technologies
According to the ISO 9004 standard, innovation can be applied to issues at all levels, through
changes in technology or product, i.e. innovations that:
- Respond to the changing needs and expectations of customers or other interested parties
- Anticipate possible changes in the organization’s environment and product lifecycles
22. 22
Technology and innovation
1983/2.1.2013/jan
Technology:
- Processes by which an organization transforms labor, capital, and
information into products (goods and services) to provide value for interested
parties (stakeholders)
(This concept of technology extends beyond engineering and
manufacturing to encompass a range of marketing, investment, and
managerial processes. It also includes quality management)
Innovation:
- A change in one of the technologies
(Ref.: Christensen)
23. 23
Value networks, the basis for technology innovation
1988/2.2.2013/jan
Organizations’ success or failure to respond to technology change depend on:
• Managerial, organizational, and cultural basis
• Ability of organizations to deal with new technology with regard to the
required new skills and competences
The concept of value network, however, has actually much greater power to create
benefits of new technologies and to avoid stumbling when confronting technology
change.
(Ref.: Christensen)
24. 24
Sustaining versus disruptive technology
1984/2.1.2013/jan
Sustaining technologies:
- Technologies fostering improved product performance
(Development of sustaining technology may be discontinuous or radical in
character or of an incremental nature.)
Disruptive technologies (discontinuous innovation):
- Technologies that result in worse product (technical) performance (at least in the near
term)
(Generally, disruptive technologies bring to market very different value proposition
than had been available previously. Generally, disruptive technologies
underperform established products in mainstream markets. But they have other
features that a few customers value. Products based on disruptive technologies are
typically cheaper, simpler, smaller, and more convenient to use.)
(Ref.: Christensen)
25. 25
The impact of sustaining and disruptive
technological innovations
1986/2.1.2010/jan (Ref.: Christensen)
Performance
Time
Performance demanded
at the high end of the market
Disruptive
technological
innovation
Performance demanded
at the low end of the market
Progress due to
sustaining technologies
26. 26
4026/20.3.2013/jan
New technologies have essential impacts on
product characteristics and the effectiveness
and efficiency of the related processes. These
technologies include:
Information technology
Biotechnology
Nano- and microtechnology
Optical technology
Energy technology
Social technology
Etc.
Technology challenges
We have been involved with the following
examples of the ICT (information and
Communication technology):
Radio frequency identification
(RFID)
Ubiquitous information technology
Internet internet of things (IoT) and
machine-to-machine applications
Mobile payment technology
Cloud services
Mashup products.
In addition to the impact on quality of products, the new technologies also have challenging
influence e.g. on environmental, social, safety and security performance, including:
Environmental protection
Information security
Health risks
27. 27
Quality management: Challenges to innovation
3993/3.2.2013/jan
Due to the crisis we have needs particularly for disruptive and lean innovations in quality
management and quality assurance practices because the existing prevalent practices in
organizations are not necessarily any more relevant or effective to the challenges of today’s
business environments, e.g. related to networked businesses and ecosystems.
Time
Speed
Changes
Agility
Complexity
Diversity
Immaterialness
Variety
(of business environment)
Business
environments
and society
Problem
Quality profession
A crisis of quality profession due to the lack of innovations in the quality management principles,
tools, and infrastructures with regard to the changes in organizations’ business environments.
Are there any real innovations
created for organizations' quality
implementations after Deming,
Ichikawa, Juran, and Feigenbaum?
Do we only follow the French
saying, "Plus ca change, plus c'est
la même chose (More it changes,
the more it's the same thing)“?
28. 28
From consensus standards (1) to creative applications (2)
A standard / Consensus process
Organization A: Realization A / Innovation process A
Practical realization
of the standard
4049/27.3.2013/jan
Standardization
Organization B: Realization B / Innovation process B
(1)
(2)
29. 29
Trampoline strategy for applying standards
3883/12.1.2011/jan
There are no restrictions to use general standards
(e.g. ISO 9000) in an innovative way and to strive for
excellence in business performance.
– It depends only on organizations’ business
leaders’ and experts’ will and ability to
differentiate from the others of the crowd.
– The biggest obstacles that blocks our way or
prevents or hinders progress is our existing
habbits, misperceptions, and prejudgments
that are hard to give up.
A
B
30. 30
Challenges for creative ISO 9000 applications
1880/8.2.2013/jan
We cannot change general standards but we may implement and apply them
creatively:
1. Sound guiding business ideas, e.g. organization-dedicated concepts
and principles, goals and strategies, aligned with the challenging aims
of the ISO 9000, and particularly ISO 9004:
• Living with the models of the modern professional quality
approach integrated with business issues
• Understanding ISO 9000 standards for quality of management
and for business excellence
2. Effective tools, methods and theories supporting the quality approach:
• Using internationally recognized methodology for increasing
business effectiveness and efficiency, and for differentiating
from the others
• Applying modern means, e.g. using advanced IT business
methodology (“e-quality”, “e-certificate”, etc.)
3. Innovatory management infrastructure for realizing the quality
approach
• Mobilizing the whole organization to use innovatively company’s
selected business integrated quality principles and tools
• Tuning quality approach with the rapidly changing and emergent
business environment and organizational management
structures
Quality integration
based on a creative
application of the ISO
9000 standards
32. 32
Recognizing and appreciating people role in innovation
as individuals and in collaborative networks
4050/3.1.2013/jan
Intellectual property (IP) derives from the work of an individual's mind or intellect. IP includes
industrial property (inventions, patents, trademarks, industrial designs, and geographic
indications of source) and copyright (novels, poems and plays, films, musical works, artistic
works such as drawings, paintings, photographs and sculptures, and architectural designs).
• Intellectual property rights (IPR) give the creator an exclusive right over the use of his/her
creation for a certain period of time.
• Creative Commons provides an infrastructure and tools to
give individual creators, companies, and institutions a simple,
standardized way to a “some rights reserved” approach to
copyright though licenses that are legally solid, globally
applicable, and responsive to our users’ needs.
Today, many of the innovations come from the collaboration of many individuals operating in
networks. Genuine innovatory networks are unplanned, emergent aggregations. Network
members are independent actors. Nobody manages the network as a whole but each actor has
its own characteristic impact in the network.
Crowdsourcing is the practice of obtaining needed services, ideas, or content by soliciting
contributions from a large group of people and especially from the online community rather
than from traditional employees or suppliers.
Creativity is in connection with the human subconscious and intuition (imaging). Every human
being is naturally creative. A key issue is to release this ability of the internal and external
obstacles to implementation, and to activate it to practical situations (processes).
These pages are licensed
under the Creative Commons 3.0 License
http://creativecommons.org/licenses/by/3.0
(Mention the origin)
33. 33
A road to an individual mastery in creativity
3998/7.3.2013/jan (Ref.: Julia Cameron)
Road to creativity is affected by:
1. The sense of safety; positive attitude to creativity without fear
2. The sense of identity; honest self-scrutiny and awareness with regard to own needs,
interests and mental limits, autonomy and self-protection
3. The sense of power; mental strength, and perseverance to overcome obstacles of
spiritual growth, hope
4. The sense of integrity; being honest and having strong moral principles, moral
uprightness, being whole and undivided
5. The sense of possibility; release from everyday ties, believe in a new and positive action
6. The sense of abundance; joy and plentifulness of the good things of life
7. The sense of connection; social and professional contacts for influence and help
8. The sense of strength; winning the losses and withstanding criticism, coping with the
inadequacy of time
9. The sense of compassion; sympathetic concern about the sufferings or misfortunes of
others
10. The sense of self-protection; avoiding obsessions, e.g. workaholism, dangers due to
lack of mental stimulation, lust of reputation, and unhealthy competing
11. The sense of autonomy; feeling freedom, acceptance and success, detaching from self-
centeredness, getting contact with the outside world through physical activity
12. The sense of faith; trusting, knowing own consciousness and creativity, recognizing
imagination
35. 35
Integrating quality and innovation managements with
business management in an organization
3994/3.2.2013/jan
Organizations have a key role in implementing quality and innovation procedures in
practice.
It is not beneficial to the organizations if quality management and innovation
management are developed apart from organization’s business aspirations and as
isolated initiatives from each other.
Quality and innovation disciplines need each other and they even may cross-fertilize
each other, e.g. there should be quality and innovation in both quality and innovation
processes.
36. 36
Business integration: Linking quality management and
innovation management to business management
3981/3.4.2013/jan
Business
management
Fayol 1916
Taylor 1911
Modern
business thinkers
Role model
organizations
Management theories
X, Y, and Z
Business integration
Quality Innovation
Shewhart 1924
Ichikawa 1962
Feigenbaum 1945
Deming 1947
Juran 1935
Modern
quality activists
Tarde 1903
Role model
organizations
Great inventors
Modern technological
inventions
Schumpeter 1939
Technological innovations
Rogers 1962
Social innovations
Intellectual Property
Rights
Collaborative
innovation
Global, national and
regional movements
Ancient quality
achievements
Ancient innovation
achievements
National and regional
movements,
ISO standardization 1979
37. 37
Integration is the main strategy for a professional
expertise approach within an organization (system)
Integration means:
• Implementing effective and efficient expertise
items embedded within normal business
management activities (especially in business
processes)
- Acting against building distinct ”expertise
systems” (i.e. lack of integration).
Business-separated expertise initiatives
are artificial.
One must understand and take into account the
nature of the organizational system, its business
and its realities when implementing expertise
initiatives of business management. Integration is
always an organization-dedicated solution.
3988/8.1.2013/jan
Expertise disciplines may include:
•Finance
•Quality
•Business risks
•Assets
•Information security
•Human resources
•Information and communications
•Knowledge
•Occupational health and safety
•Environmental protection
•Innovation
•Ethics
•Social responsibility
•etc.
There are different standards published for
these different expertise disciplines.
Cross-influence and collaboration of all expertise
areas are needed. E.g. innovation is needed in
quality management and quality in innovation
management.
38. 38
Invention
(Creativity and an
inventor’s idea)
Innovation
(A new solution in use for
the benefit of individual,
organization, or society)
Time, money, resources, activity, collaboration,
multi-disciplinary know-how, commitment
I1 I2
I3Old
Old New
OldNew
Product (goods, service),
or structure (What)
Activityorprocess(How)
Environment
Education,
knowledge Design
Expert services Manufacturing
Marketing
Realizing solutions: People, processes, structures,
practices, organizations, cultures, values, etc.
Benefits to all involving parties
Materials
Sales
Financing
Development
Management
Piloting,
testing
Software
Delivery,
logisticsHostile
agents
Quality and innovation realization
3999/7.1.2013/jan
39. 39
Integrating specialized managerial disciplines and
ensuring natural business diversity
3342/2.2.2013jan (Ref.: ISO Management systems standardization, MSS)
General
management
responsibilities
and a business
system
Risks
Finance
Product
quality
Occupational
health and safety
Security
Environment
Social
responsibility
Innovation
The Finnish model
for integration (MSS)
Organizational diversity
Organizational
identity & privacy
General management
systemBusiness
leaders role and
responsibility
41. 41
From top management’s understanding, communication,
and commitment to business system’s performance
1057/5.1.2013/jan
0Head’s
Idea
Collaborators,
Senior Leaders
(Chain Reaction)
System
(for Business
Mission):
• Employees
• Partners
• Experts
Major business
results
(Improvement)
= Catchball
+
CEO,
President
42. 42
3621/2.1.2013/jan
An organization is a living organism. It is a set of
conversations among people.
Language is the defining environment in which an
organization lives. It is how those in the system reach
agreement. Language is a medium for organizational
growth and change.
Narrowing language increases efficiency. A shared common
language helps the organization arrive at decisions more
efficiently.
Narrowing language increases ignorance. Constrained
by a limited vocabulary, the organization becomes
unable to adapt to fundamental changes in its
environment. Being unable to change, the organization
eventually declines. As ignorant of our own ignorance,
we cannot ask questions outside our own language
experience.
Conversations necessary for
generating new opportunities
come from outside the
organization, from the language
that has a different history.
(Ref.: Sun, The little grey book)
The crucial role of leadership and language
in organizational creative development
An organization may learn and grow only if it creates conditions that help generate new language.
Using new language, an organization may create new paths to productivity, and regenerate itself.
43. 43
Organizational learning for quality management and
innovation management integration in an organization
3995/3.2.2013/jan
1. Conceptual compatibility
• Quality management = coordinated activities to direct and control an organization
with regard to quality (ISO 9000)
• Innovation management = coordinated activities to direct and control an
organization with regard to innovation
2. Business management’s consistent commitment to quality and innovation from the
organization’s business management point of view
3. Collaboration of the organization’s quality and innovation experts in the organization
• Organizational expertise reinforcing contacts to external experts and knowledge
sources
4. Harmonized approach in implementing both quality and innovation procedures in the
organization
• ISO/IEC Directives for the high level structure and common concepts that are aimed
at for systemizing the management of the different disciplines may be useful.
5. Common managerial framework that supports organizational learning in all necessary
knowledge areas that are needed for the business management
44. 44
Cornerstones of an organization’s different disciplines
management (A learning organization framework)
3996/15.2.2013/jan
An organization’s
disciplines management
approach and
integration
(1)
Clear understanding of
the guiding ideas,
concepts, and principles
(3)
Efficient
innovatory
management
infrastructure
(2)
Effective
management
tools
Given
“ImplicateOrder”
(Ref.: P Senge)
Performance
excellence
Performance references:
-Own targets
-Competitors’performance
-World class level
45. 45
Foundations for managing the balanced
multidisciplinary learning in an organization
1. Personal mastery
2. Mental models
3. Shared vision
4. Team learning
5. Systems thinking
3997/10.1.2013/jan (Ref.: Senge)
Quality Innovation
Business
47. 47
4051/3.1.2013/jan
Quality and Innovation, as managerial disciplines
- Conclusions
From a business perspective:
1. The general evolution of quality and innovation disciplines takes place separately by the
experts of the discipline communities.
2. These disciplines have remarkable conceptual relationships and useful interactional
possibilities.
3. Quality and innovation arise in organizations’ business systems through business
processes. National, regional and global authorities and institutions have a supportive role.
4. Challenges:
• Innovation achievements from quality professionals with regard to quality
management and quality assurance methodology
• Enhancement of quality of innovations, i.e. to fulfill needs and expectations
people, organizations and societies, supported by professional quality
management processes
• Collaboration of the quality and innovation practitioners and professionals
• Organizational learning and business integration in organizations
From a societal and global perspective:
Only quality and innovation could save our planet!
