The Malcolm Baldrige National Quality Award (MBNQA) is awarded annually to recognize firms that have achieved overall excellence in leadership, organizational effectiveness, operations and business results. Congress authorized the award in 1987 through Public Law 100-107. The purpose of the MBNQA is to improve the performance and competitiveness of U.S. companies in the global marketplace and to provide a forum for sharing best practices.
Manufacturing and service businesses of any size, which include electrical contracting firms, can win the MBNQA. However, the firm does not have to participate in the award process to benefit from the MBNQA. The MBNQA self-assessment criteria provide an excellent framework for evaluating and improving the electrical contracting firm’s performance. This article introduces the criteria that serves as the basis for selecting MBNQA recipients and discusses how the electrical contracting firm can use this criteria to improve its performance.
The Malcolm Baldrige National Quality Program (MBNQP) 2002 Criteria for Performance Excellence is updated and published annually by the National Institute of Standards and Technology (NIST). The MBNQP Criteria changes annually to reflect the latest in management thinking and the business environment. Many firms that have no intention of applying for the MBNQA use the criteria to assess their performance as a basis for continuous improvement and preparation for the future.
The MBNQP Criteria treats the firm holistically and looks beyond current business results, recognizing that today’s results were due to yesterday’s decisions, operations and business environment. Past and present business results only provide the springboard for the company’s future success. Tomorrow’s success is not determined by today’s financial results but by the firm’s leadership, strategic planning, customer and market focus information and analysis, human resource focus and process management. These dimensions, along with business results, provide the basis for the MBNQP framework for performance excellence.
MBNQP performance excellence framework
The MBNQA framework for performance excellence includes criteria that are organized into seven categories. These categories are based on the 11 MBNQP core values and concepts listed in Table 1. The categories are as follows:
• Category 1.0—Leadership
• Category 2.0—Strategic Planning
• Category 3.0—Customer & Market Focus
• Category 4.0—Information & Analysis
• Category 5.0—Human Resource Focus
• Category 6.0—Process Management
• Category 7.0—Business Results
MBNQP performance categories
As shown in Table 2, the seven performance criteria categories are broken down into subcategories and have points attached to each subcategory for scoring. The MBNQP Criteria describes the evaluation criteria associated with each of these subcategories in detail as well as how to assign points to grade the company’s performance in each subcategory. Figure 2 illustrates the relative importance of each category in the current MBNQP Criteria.
o Category 1.0—Leadership. This category is concerned with how the electrical contracting firm’s upper management guides the organization in setting values, direction and performance expectations. In addition to organizational leadership, this category also examines how the company addresses its responsibilities to the public and practices good citizenship.
o Category 2.0—Strategic Planning. This category addresses strategic planning and how well a company sets its strategic direction and develops strategic objectives. In addition, it examines how the electrical contracting firm converts its strategic objectives into action plans. This includes measuring the firm’s progress toward its strategic objectives against its action plans.
o Category 3.0—Customer & Market Focus. Category 3.0 is concerned with how the electrical contracting firm determines customer and market requirements, expectations and preferences. This category also addresses how the company builds relationships with customers and determines the key factors that lead to customer acquisition, satisfaction and retention.
o Category 4.0—Information & Analysis. This category is concerned with the electrical contracting firm’s ability to identify and gather key data, process that data into information and then use it to improve organizational effectiveness and efficiency. Data gathering and analysis are key to continuous improvement and achieving competitive advantage in the marketplace. Category 4.0 assesses how effective the electrical contracting firm is at gathering data, processing it and using the resulting information to support organizational planning and improvement. In addition, this category examines how the electrical contracting firm ensures that employees, suppliers, customers and others have the information they need to make decisions and perform work.
o Category 5.0—Human Resource Focus. Category 5.0 is concerned with how the electrical contracting firm motivates and enables employees to develop to and use their full potential. Human resources are the most important factor in the company’s success. Employees must be provided with a supportive work environment and aligned with the electrical contracting firm’s objectives and action plans. This category evaluates the electrical contracting firm’s work systems, which include job design, compensation, performance evaluation and other related factors. Also evaluated are employee development, which includes education and training as well as employee well-being and satisfaction.
o Category 6.0—Process Management. Process management addresses the electrical contracting firm’s production, business and support processes. Production or construction processes result in work being in place at the project site. Business processes contribute directly to fulfilling the firm’s objectives.
The company’s objectives are typically tied to improving field operations. As a result, its business processes might include estimating and bidding, procurement, and tool and equipment management.
Support processes are those that are necessary for the company’s day-to-day success but don’t directly impact the achievement of its strategic objectives. These processes could include accounting, finance and other similar activities that are important but not strategic. Category 6.0 evaluates the firm’s ability to design, implement and continually improve production, business and support processes.
o Category 7.0—Business Results. Category 7.0 evaluates the electrical contracting firm’s outcomes in the following four key strategic areas:
• Customer Satisfaction
• Financial & Market Performance
• Employee Satisfaction & Growth
• Operational Effectiveness
Obtaining additional information
The MBNQP Criteria and other information is available on the NIST Web site (www.quality.nist.gov). Application forms and instructions can be downloaded.
Information about the MBNQA and easy-to-use assessment tools and self-assessment guides are also accessible. NIST’s MBNQA is an invaluable resource that can help your firm improve results, achieve objectives and ensure future success. EC
This article is the result of a research project entitled ISO 9000 Evaluation & Update that is being sponsored by the Electrical Contracting Foundation, Inc. The author would like to thank the Foundation for its continuing support.
GLAVINICH is director of Architectural Engineering & Construction in the Department of Civil, Environmental & Architectural Engineering at The University of Kansas. He can be reached at 785.864.3435 or firstname.lastname@example.org.