In my work with both manufacturing and nonmanufacturing organizations, I have been faced with the challenge of improving quality. Toward that end, I'd like to offer a few simple lessons that I have learned.

• Know the set of attributes that customers in your industry use to measure value, and the expected levels of each as they apply to your firm.

• Minimize variation.

Remember that: Customer value = Perceived benefits – Price

Based on this, I define quality as the adequate and consistent provision of value, as defined by, or in excess of, what is defined by the customer.

For the selling firm, there is another element, and that is profit. Because firms seek to make money, they are forced to decide to what extent they will provide the elements that the customer values. Firms are often not able to maximize provision of all of the attributes that customers find valuable because that policy would result in uncompetitive prices.

Lesson 1: Customers are the sum of their expectations. Any market can be broken down into the distinct attributes that the customers in it consider to be valuable.

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