The Value of Excellence Awards

One of the questions Paul Borawski asked in his blog was what the value of the Excellence Awards Programs Globally, so I will think in that perspective.

In Ecuador, the Award of Excellence was introduced in year 2000, being administered by “Corporación Ecuatoriana de la Calidad Total”, a nongovernmental organization and whether it has received the backing of the government on many occasions, their whole operation is based on memberships of those companies who want to learn the model and those who have participated in the Award.

In Ecuador we have adopted the USA model Malcolm Baldrige, and follows a similar pattern, there are examiners who have been previously trained and have experienced in the industry, whom VOLUNTARY make an assessment of the companies that have entered in the contest. Once the report has been managing a particular score, an assessment is made in situ and whether it has reached at least 500 points is considered a company of excellence. Businesses in turn receive a report that allows them to work on improving gaps identified by the examiners, and the award is used as a promotional tool in and out of the country and the winners become a reference in its industrial sector.

Throughout the world there are many awards, most based on the Malcolm Baldrige Model (USA), others in the European Excellence Model, or the Deming Prize (Japan), or a mixture of them.

In Latin America Awards can be found in Argentina, Brazil, Colombia, Cuba, Chile, Ecuador, Mexico, Paraguay, Peru, Dominican Republic, among others. There is a Latin American Award called “Premio Iberamericano de la Calidad”, administered by FUNDIBEQ. Countries like Canada, South Africa, and Scotland also have their own awards.

What are the reasons for the existence of an Award of Excellence and its Management Model:

- Promote awareness of quality and productivity among firms that produce goods and services.
- Facilitate the sharing of best practices, success stories and the benefits of these practices in organizations, whether public or private.
- Promote the adoption of a systems approach and integrated management, including best global practices.
- Encourage the adoption of a model that focuses on results, and has served many companies to restructure their business process management model.
- Promote the use of the Award as an educational tool for the development of social responsible organizations and economically successful.
- Facilitate self-assessment of companies on the model and use it as a basis for planning and continuous improvement.
- Also in Latin America is seen as a way to expand business markets, particularly in the international arena.

A company that is evaluated with a Model of Excellence is demanded to be more efficient, to analyze their costs and meet quality standards, to have a a greater respect for the environment, to show responsibility towards all its stakeholders, and to work with management models aligned to the most advanced in the world.

In Latin America public services companies have used the Awards and Excellence Models and realize the importance of serve better, faster and more effectively to citizens, and that this is an ethical imperative for a company and a country that wants to become developed with increasing levels of social equity.

When you adopt in the right way a Model of Excellence, it has resulted in a management culture focused on meeting stakeholders through continuous improvement in quality.

A Model of Excellence is a powerful mechanism to detect and recognize the capabilities presented by each organization. It is not prescriptive, promotes the use of practices or tools appropriate to the particular characteristics of each entity.

Participating in the National Award for Quality is not just about search recognition for what you do, but also find guidelines and examples of continuous improvement, and be aware that improvement is feasible to all organizations whose efforts and constant improvement will enable success.

In Ecuador and in most countries, the Awards are made in a public ceremony attended by the authorities, in which the winners have the opportunity to have lessons learned and to encourage more firms to undertake the road to improvement. For example on 04 December took place the ceremony for the “Premio Iberamericano de la Calidad 2010” Notably, this year for the first time, the award was given for organizations in an specific category for Public Administration. See link: http://www.fundibeq.org/opencms/opencms/PWF/home/index/index.html

If we make history one of the pioneering countries in granting these awards was Japan. The Prize for Total Quality Management was established in 1951. Is given by the Union of Japanese Scientists and Engineers (JUSE) and is named in honor of Dr. W. E. Deming. The Award has three categories: Individual Award (people), Application Award (organizations) and Awards for Operational Units.

Drs. Singhal and Hendricks compared the financial performance of nearly 600 companies winning quality awards compared to a control sample of companies of similar size and operating in the same sectors. It followed the trend of both groups over a period of five years beginning one year prior to four years after the winners won their first Awards. Award winners experienced a 44% return on the stock price, 48% growth in operating income and 37% growth in sales compared with the control group.

Another earnings from Excellence Models are the SELF ASSESMENT, where companies can get a FREE comprehensive review of its activities and results compared to the model, and get what their strengths and areas for improvement in relation to that model. This will allow to establish the necessary actions to improve in those areas in need and their subsequent monitoring of progress.

In relation to whether there should be government financial support for the management of the Awards and models, I think it's definitely one of the areas in which to invest and not to be only in USA but around the world.

My last idea, we always have to look for the best practices worldwide to strengthen these kind of programs, and never forget to listen the voice of the customers.