Like a seal of approval, the Malcolm Baldrige national quality award-summarized as excellence in leadership, strategic planning, customer and market focus, information and analysis, human resources, process management, and demonstrated results-confers on winners a reputation for operational superiority admired worldwide. For most, winning crowns a five- to 10-year process of preparation. But the Baldrige can also be hard to live up to under tough business conditions, as some past winners have discovered.
“Once you win, all of your stakeholders expect perfection,” explains Dale Crownover, president and CEO of Texas Nameplate Co., a family-owned maker of industrial identification labels in Dallas. Crownover received the small business award in 1998 and is now a Baldrige judge. “If you ship a defective part, everybody will remind you, €˜I thought you were a Baldrige winner,’” says Crownover, joking that his own mother reminds him of it if he disappoints her. “You get up in front of the president and everybody tells you how good you are, then the next year you’re laying people off. A lot of [winners] are experiencing that.”
As good as companies are when they’re honored, they’re not bulletproof. Two-time winner The Ritz-Carlton Hotel Co. was recently criticized for inconsistent service quality on the front page of The Wall Street Journal, which reported that the Atlanta company had slipped from top place among customer satisfaction rankings, a key Baldrige measure.
Even so, most Baldrige recipients would agree with Don Evans, president and CEO of 2000 winner Operations Management International, a $161 million water treatment company in Greenwood Village, Colo.: “The Baldrige isn’t a guarantee of success, but it gives you additional tools that are very helpful when you face challenges you didn’t anticipate.”
Auto parts manufacturer Dana Corp. underwent restructuring a year after its driveshaft division won. The Toledo, Ohio, company adopted Baldrige criteria in the late ’80s and since 1992 has trained almost 2,000 employees to serve as internal quality auditors, according to CEO Joseph Magliochetti. Dana’s Spicer driveshaft division won the Baldrige in 2000 and its commercial credit division won in 1996.
Last October, Dana announced it would cut its workforce by more than 15 percent and close over 30 facilities. But Magliochetti is determined not to cut back on quality. “We’ve tried to hold sacred this consistency across the organization,” he says. “We’re not going to compromise quality or best practices. It can be a heavy financial commitment, but quality tends to pay for itself.” -Sonja Sherwood