By: Bill May, President of High Value Manufacturing
Daily reports of poor manufacturing quality permeate the news. Stories of recalls, warranty claims, lawsuits, and dissatisfied customers are regularly reported across a multitude of industries.
Quality failures can harm any business – leading to product recalls, safety concerns, dissatisfied customers, damaged brand reputation, and financial losses. Such shortcomings may arise due to inefficiencies in processes, lack of data visibility, or inadequate collaboration between teams.
Recently reported quality issues include:
- Product failures across multiple industries: Automobiles, Commercial Aircraft, Consumer Products, Food, Beverages and Drugs.
- At least 24 Food, Beverage and Drug recalls in the month of August 2024.
- In 2023, there were 1,000 recalls for vehicles, car seats, tires, RVs and other related transportation equipment and components.
- Per U.S. Consumer Product Safety Commission, there were over 300 consumer product recalls in 2023.
- Software upgrade errors and recalls in numerous industries.
- Multiple quality-related Class Action Lawsuits.
A look at the Automotive Industry
According to ABC News, the average number of car recalls each year jumped by 46% over a 10-year period ending in 2022. This increase in recalls over the previous ten-year period is largely due to the increased complexity of vehicles with electronic components that increase the likelihood of a malfunction and necessitate more emphasis on quality manufacturing processes.
Over the five years ending in 2022, the U.S. averaged more than 1,000 car recalls each year, or about 27 per day, the data shows. Until 2016, the U.S. had not exceeded 1,000 car recalls in any year going back to at least 2002.
Measuring new vehicle quality
To quote JD Power:
“Since 1987, the J.D. Power U.S. Initial Quality StudySM (IQS) has served as the auto industry standard for benchmarking new vehicle quality.”
JD Power redesigned the IQS survey questions in 2020 to better reflect the types of problems new vehicle owners were experiencing. The average PP/100 over the 10 years prior to these adjustments indicates a 17% improvement in the quality measurement. Interestingly, since the modifications in 2020 the average IQS indicator has seen a 15% degradation, which seems to more accurately reflect the reality of poor quality issues reported by companies and in the news.
Review of this JD Power data indicates an industry-wide issue that is not related to any one OEM or supplier. A pedestrian analysis of the information shows a significant change in the dispersion of the data from the 2010 to 2019 period and the most current five years (2020 to 2024). As a matter of fact, the “range” of the quality ratings has increased by 180% during the latter of these two periods. This indicates a rapid deterioration of capability within the industry, especially most recently.
Automotive Initial Quality Survey (IQS) results from JD Powers:
This chart summarizes annual IQS ratings for 41 vehicle manufacturers over a 14-year period.
According to JD Power:
“The higher problem levels we see in this year’s study don’t mean vehicle quality has worsened; rather, the redesigned study asks additional questions that allow owners to cite more of the problems that they are experiencing.”
In the prior 10-year period there were always a few manufacturers whose name plates “stood out” from the others with leading IQS scores. In the most recent 5-year period there has been no ‘clear’ stand out from a quality measurement perspective, good or bad.
Over the last 5 years, there have been four different manufacturers at the top of the list with the best quality scores. Likewise, four different manufacturers have found themselves at the bottom of the list over the same period. This outcome exemplifies the lack of consistent quality leadership. Plus, the variation of quality scores is greater than ever.
As a young engineer, I was taught:
“Do not create defects, do not pass defects, and do not accept defects.”
Let’s go back to the basics
Quality basics start with a disciplined approach to the Product and Manufacturing Process design such as Advanced Product Quality Process (APQP), followed during the implementation phase with adherence to the global standards such as ISO 9001. In the Automotive world, the IATF 16949 serves as that guideline for Quality Manufacturing Systems (QMS). All of these methods are established on a foundation of a company-wide Quality Management System and intentional culture that focuses on quality at every level in the organization.
The leadership of all U.S. manufacturing entities (both OEMs and suppliers) must be looking at their quality performance and seeing a huge opportunity to distinguish themselves from their competition. This opportunity applies to all industries, not just Automotive.
When will someone choose to make Quality their clearly stated competitive advantage?
Now is the time to act!
Manufacturing leadership must step forward and demonstrate how to implement effective quality management strategies, including stable manufacturing processes. They must model how to address challenges in quickly adopting new product designs and manufacturing methods without repeating past mistakes.
HVM is ready to assist.
About High Value Manufacturing:
With offices in Nashville, TN, and Auburn, AL, HVM is a world-class provider of manufacturing operations talent and performance improvement services for all manufacturers. HVM has a proven track record of delivering immediate, results-driven solutions. HVM improves efficiency, lower costs, maximizes throughput, and increases profit for our clients.
In addition to operational assessments and performance improvement planning, HVM provides the combination of highly skilled and highly experienced resources to deliver the necessary technical support for manufacturing clients requiring immediate labor solutions, with capabilities to provide an entire cross-functional quality team fully experienced in the application of the APQP process and related quality improvement processes. HVM’s proven Quality Management System (11+1 Quality Strategies) is readily available for implementation in your manufacturing organization.
Did you enjoy this blog? Search our blog library for other topics of interest: https://highvaluemanufacturingconsulting.com/blog/