A CFO's view: invest in "quality teams" for decision making.

• Author: Smith, Paul L.
• Position: Includes related article - The Quality Struggle - From Two Angles

Paul L. Smith Senior Vice President and CFO Eastman Kodak Company

The changes at Kodak over the last decade have changed not only our structure, but our culture. They've changed how we interact with one another on a day-to-day basis, how we think, how we operate. One of those changes is how we view those we serve and how they view tis.

In broad strokes, Kodak's finance and administration people are no longer viewed as a corporate resource. Instead, we're viewed as suppliers. And we no longer view anyone seeking information and advice as just another business associate. We view them as valued customers. And that's the lingo of quality.

Nowadays, many companies have their own quality processes, all focused on best meeting the needs of the customer. Our chairman and CEO, Kay Whitmore, has asked us to go beyond the traditional measures of performance - cash flow, earnings from operations, sales, and ROA - and begin to measure the behaviors and activities that ultimately drive those traditional numbers for long-term value. What we're talking about is making quality count, even in the financial environment. But to do this successfully requires investment in a quality process, in leadership, and in people.

Seduction of correcting for quality

We call Kodak's investment quality process the quality leadership process, or QLP. It goes beyond the performance appraisal. I think some of us assumed that if the people we served didn't complain loudly enough, we had done quality work. We never established an ongoing process of quality measurement. We never knew how we were doing or what we needed to do to continuously improve, just how we had done.

But, a few years ago, we asked ourselves a very insightful question: can a quality product or service be achieved by non-quality methods? You might jump to the conclusion that the answer is no. After more thought, you'll likely join our position that the answer is yes. It happens whenever we waste valuable resources, when we waste time, effort, and money by not doing things right the first time and having to correct them later. We realized Kodak could be producing quality products in an environment that operates without top-quality practices.

Today, when we refer to quality in Kodak's finance and administration organization, we mean the quality of all our business activities and the impact these activities have on current and future customers, both internally and externally.

Our QLP begins and ends with these directives: assess, plan, do, and verify. The most important element is the idea that we can't be just customer-focused. We have to be customer-obsessed! Our challenge is not in seeing our customers, but in seeing ourselves as our customers see us. That means current customers, customers we lost but wish to regain, and new customers. It's like asking, "Would you like to be your customer?"

The nuts and bolts of quality teams

Kodak's commitment to quality has required a lot of hard work. It began with developing a mission statement that says who we are, what we do, and for which customers.

Next, we developed a vision statement, describing what we desire for the future. And this statement wasn't developed by fiat. I worked with my direct reports in quality team meetings and they, in turn, worked with their direct reports in quality team meetings, and so on. These teams are interlocking. Each one depends on the others, and communications flow in all directions, even to the CFO. We didn't establish the teams simply to create a...