BSA partner Kim Phillipi writes article for this month's Performance matters newsletter
Using Corrective Action Requests to Improve the Performance of Your Businesshttp://http://www.bpi.org/news_pm_july_2011.aspx
When you hear the term “quality management systems” (QMS) applied to your business, your first thought might be, “Oh no! More paperwork to push, eating more of my time (and reducing my profits)!” Fear not the paper dragon. The fact is that many contractors already have informal QMS systems built into their business based on the expectations and beliefs of the owner. So, if formalizing some of these systems would improve top and bottom line performance, why wouldn’t a contractor implement them? QMS systems can improve the performance of your business by increasing sales, increasing customer retention and ultimately the bottom line. It makes sense to formalize these processes, even when the paperwork isn’t required by government energy efficiency incentive programs, as is often the case.
Corrective Action Request (CAR)Most QMS systems for multiple industries use CARs to identify a problem found in the field or during an on-sight inspection. Documentation of the problem is then formally submitted to the contractor or designated party for corrective action follow-up that must be responded to in writing. Click here to view an example of a Contractor Corrective Action Report.What is a Corrective Action Request?
Major or Minor Finding: Each program may have a slightly different definition of how they define major or minor findings for items like safety, workmanship, installation of wrong measures, etc. If a contractor wants to use this same system for improving their business they might define a major finding as anything that impacts Sales, Profits or Customer Retention.
Root Cause: What was the problem?
Interim/Short Term Corrective Action: What can I do to fix the problem at least short term? If a customer complaint, perhaps it’s just a formal phone call or meeting with the customer, combined with itemized repair of the work completed.
Preventative/Long Term Corrective Action: How do I make sure this problem does not happen again to this customer or any other customer? Formalizing this step helps eliminate the same type of problem from occurring in the future and negatively impacting customers. Example: A new crew was put on a job and did not properly follow test-out procedure, which would have detected the problem. The crew will be re-trained on proper test out procedures before being assigned to the next job.
Objective Evidence: Programs usually want proof that the preventive corrective action was completed (e.g., training the crew on test out procedures and having the crew sign a document indicating the training was completed). Internally, as business owners we want to make sure the follow up gets done and the supervisor completes it so the same problems don’t happen to future customers. The construction and home performance market will continue to implement more rigorous quality assurance systems that many industries, including automotive, consumer products, medical, information technology and others have had in place for decades. With the home still being the largest single asset of many families it only makes sense that the construction industry will follow.
Customer Retention We all know the high costs of attracting new customers. The importance of repeat business cannot be over emphasized. Why not formalize a system to make sure our existing customers get quality service, and avoid future problems? With Entela, my testing and engineering firm, many industries required us to develop corrective action responses based on audits, accreditation requirements and the like. We used some of these systems not just to meet the lowest bar required by the audits, but to improve our customer satisfaction and retention rates. After implementing an internal corrective action system for customer complaints, our post-complaint customer retention rate jumped from 60 percent to over 97 percent - this means our customers continued to do business with us even after their complaint! All employees were required to document any type of customer complaint, no matter how small. This became the internal culture and expectation of our company; there were only negative consequences if the company found that an employee did not document and process a corrective action. Employees took pride in knowing that we were committed to resolving any customer issue, and overall customer complaints decreased.
Kim Phillipi, Senior Partner of Building Science Academy and Building Science Energy Services, LLC, has more than 20 years of experience in the testing, engineering and systems certification field as owner, CEO, and Chairman of the Board of Entela (now owned by Intertek). Kim has extensive experience in the development of quality management systems for the automotive, information technology, consumer, medical device industries and many other industries. She oversees Building Science Energy Service’s operations and administration, and has supervised the operations of a $30 million annual company budget for six operations internationally. She is a co-founder of the Laboratory Accreditation Bureau, which has national and international recognition as a calibration and laboratory accreditation body for ISO 17025. Kim has a BS degree in Materials Engineering.
When you hear the term “quality management systems” (QMS) applied to your business, your first thought might be, “Oh no! More paperwork to push, eating more of my time (and reducing my profits)!” Fear not the paper dragon. The fact is that many contractors already have informal QMS systems built into their business based on the expectations and beliefs of the owner. So, if formalizing some of these systems would improve top and bottom line performance, why wouldn’t a contractor implement them? QMS systems can improve the performance of your business by increasing sales, increasing customer retention and ultimately the bottom line. It makes sense to formalize these processes, even when the paperwork isn’t required by government energy efficiency incentive programs, as is often the case.
Corrective Action Request (CAR)Most QMS systems for multiple industries use CARs to identify a problem found in the field or during an on-sight inspection. Documentation of the problem is then formally submitted to the contractor or designated party for corrective action follow-up that must be responded to in writing. Click here to view an example of a Contractor Corrective Action Report.What is a Corrective Action Request?
Major or Minor Finding: Each program may have a slightly different definition of how they define major or minor findings for items like safety, workmanship, installation of wrong measures, etc. If a contractor wants to use this same system for improving their business they might define a major finding as anything that impacts Sales, Profits or Customer Retention.
Root Cause: What was the problem?
Interim/Short Term Corrective Action: What can I do to fix the problem at least short term? If a customer complaint, perhaps it’s just a formal phone call or meeting with the customer, combined with itemized repair of the work completed.
Preventative/Long Term Corrective Action: How do I make sure this problem does not happen again to this customer or any other customer? Formalizing this step helps eliminate the same type of problem from occurring in the future and negatively impacting customers. Example: A new crew was put on a job and did not properly follow test-out procedure, which would have detected the problem. The crew will be re-trained on proper test out procedures before being assigned to the next job.
Objective Evidence: Programs usually want proof that the preventive corrective action was completed (e.g., training the crew on test out procedures and having the crew sign a document indicating the training was completed). Internally, as business owners we want to make sure the follow up gets done and the supervisor completes it so the same problems don’t happen to future customers. The construction and home performance market will continue to implement more rigorous quality assurance systems that many industries, including automotive, consumer products, medical, information technology and others have had in place for decades. With the home still being the largest single asset of many families it only makes sense that the construction industry will follow.
Customer Retention We all know the high costs of attracting new customers. The importance of repeat business cannot be over emphasized. Why not formalize a system to make sure our existing customers get quality service, and avoid future problems? With Entela, my testing and engineering firm, many industries required us to develop corrective action responses based on audits, accreditation requirements and the like. We used some of these systems not just to meet the lowest bar required by the audits, but to improve our customer satisfaction and retention rates. After implementing an internal corrective action system for customer complaints, our post-complaint customer retention rate jumped from 60 percent to over 97 percent - this means our customers continued to do business with us even after their complaint! All employees were required to document any type of customer complaint, no matter how small. This became the internal culture and expectation of our company; there were only negative consequences if the company found that an employee did not document and process a corrective action. Employees took pride in knowing that we were committed to resolving any customer issue, and overall customer complaints decreased.
Kim Phillipi, Senior Partner of Building Science Academy and Building Science Energy Services, LLC, has more than 20 years of experience in the testing, engineering and systems certification field as owner, CEO, and Chairman of the Board of Entela (now owned by Intertek). Kim has extensive experience in the development of quality management systems for the automotive, information technology, consumer, medical device industries and many other industries. She oversees Building Science Energy Service’s operations and administration, and has supervised the operations of a $30 million annual company budget for six operations internationally. She is a co-founder of the Laboratory Accreditation Bureau, which has national and international recognition as a calibration and laboratory accreditation body for ISO 17025. Kim has a BS degree in Materials Engineering.
Labels: BPI certification, Building Performance Institute, building science academy, Building Science Energy Services, corrective action, Energy Audit, energy retrofit, Kim Phillipi, quality assurance
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