Introduction
Quality is a concept that businesses have been trying to define for decades. To create a contest based on the companies’ performance, analytics and researchers created Business Excellence Awards – a set of standardized measurements of the firms’ resources, sales, management, and products (Eriksson 1395). While these awards may push companies to innovate and invest more attention and funds into their structures than before, they can also lead to some adverse outcomes. Some of the most prominent drawbacks of quality excellence awards include the misuse of financial resources to produce uneven results, a qualitative structure of evaluation, and the lack of customer inclusion in the processes.
Drawbacks
The examination of businesses for awards is a process that may lead to a number of negative effects on firms and the state of the competition. For example, participation in the EFQM (European Foundation for Quality Management) award requires companies to collect information and develop a report describing its processes and systems (Shahin et al. 51). Then, the firm should apply and wait for feedback on the collected data and the assessment of the facilities.
Here, the firms that prepare for the evaluation process may concentrate their finances and other resources on adhering to the instructions of the competition, although their usual performance may have different results. Moreover, if self-assessment is a part of the award’s requirements, then businesses may take advantage of this opportunity to gather information and come to biased conclusions, enhancing their results and diminishing weaknesses.
As Shahin et al. note, external assessments may also have a negative impact (51). They can change the attitude of the businesses toward the evaluators and foster defensive behavior where companies are determined to win an award but not succeed by using its criteria. The qualitative method used by most contests also contributes to this problem. It is unclear how some models form their requirements for winning.
Moreover, as the majority of awards attempt to measure multiple areas of performance, they create a complex structure of aspects and influential factors. Beshah states that such an approach does not guarantee a fair and balanced outcome (627). The scholar points out that firms do not show exceptional results, thus making such awards unreliable to some extent (Beshah 626).
Finally, the nature of these awards and their standardized structure should be highlighted as drawbacks because they limit the participation of customers in the decision making process. Peng and Prybutok suggest that customer focus is not clearly defined in the MBNQA model (Malcolm Baldrige National Quality Award) (641). As it was stated above, applications often have to nominate themselves by sending the request to the committee.
The focus on customers that is usually the target of many managing efforts is entirely absent here, shifting the concerns of the business from actual goals to some established performance concepts (Shahin et al. 51). If the company fails to use such awards as a tool for self-analysis and improvement, it can reach results to compete with others instead of acknowledging customer needs.
Conclusion
Business excellence awards can be used to promote innovation and encourage companies to reconsider their effectiveness. However, they also increase the levels of competitiveness among firms, potentially harming their ability to cooperate and their attitude toward success. Furthermore, such awards may shift the focus of businesses from actual goals and customer needs to the adherence to the contests’ rules. Finally, the requirement for self-assessment negatively affects the results and produces biased perceptions of companies.
Works Cited
Beshah, Birhanu. “The Effect of Aggregating Multivariate Performance Parameters in a Quality Award Process.” International Journal of Quality & Reliability Management, vol. 31, no. 6, 2014, pp. 618-628.
Eriksson, Henrik. “Outcome of Quality Management Practices: Differences among Public and Private, Manufacturing and Service, SME and Large Organisations.” International Journal of Quality & Reliability Management, vol. 33, no. 9, 2016, pp. 1394-1405.
Peng, Xianghui, and Victor Prybutok. “Relative Effectiveness of the Malcolm Baldrige National Quality Award Categories.” International Journal of Production Research, vol. 53, no. 2, 2015, pp. 629-647.
Shahin, Arash, et al. “EFQMQual: Evaluating the Implementation of the European Quality Award Based on the Concepts of Model of Service Quality Gaps and ServQual Approach.” Measuring Business Excellence, vol. 18, no. 3, 2014, pp. 38-56.