Contemporary problems of quality management in enterprises

Analysis Materials 25 June 2009 12:08 (UTC +04:00)

Companies directly sharply felt the global market demands for quality products. In this regard, the main problem of Azerbaijani industrial enterprises in the current situation is the development and implementation of experience on quality management to the new conditions of industry. To do this, firstly it is necessary to develop and implement guidance and innovative, methodical organizational bases for quality management in accordance with the modern requirements for quality products.

The problem of product quality in the modern world takes a universal character. The issue on how successfully they will be solved significantly depends on economic and social life of the country. From entrance to the World Trade Organization, Azerbaijani enterprises expect sharp competition because the market will be open, and foreign companies will inevitably operate there. For many of them, the international standards of quality and safety have become a norm, while the majority of domestic enterprises still poorly understood it.

Compliance with European requirements on standardization gives an opportunity to producers to, without an extra effort, provide their products to the world market. However, Azerbaijani companies can stop if they immediately switch to the European, and American standards require only a phased transition. The quality of products manufactured by local enterprises is not low, but there are some spheres where it needs to gradually transit to the European standards. Therefore, the main task of the state is to combat the companies that produce poor-quality products, which present obstacles to large enterprises to enter the market.

In recent years, the issue of food safety has been attracting unprecedented attention. Every year, hundreds of thousands of people worldwide become ill due to food poisoning. Repeat panics rose over food have undermined consumer confidence in food safety, have raised doubts about the commitment to the principle of industrial production of safe food and questioned the ability of regulatory agencies to control the food chain.

Some domestic enterprises, including food industry, are already moving towards European standards of production. The State Committee for Standardization, Metrology and Patents carries out inspections in the enterprises producing sausages, drinks, water, and similar work at industrial facilities. Since January 2006, the Committee has not issued any certificate of conformity to the food industry, but certificates were withdrawn from nearly 200 companies, where studies have been carried out by specialists of state agencies. According to the legislation, the enterprises are given an opportunity to improve the level of production, and later, under investigation, they are issued a certificate again if there is improvement. But special mechanisms are devised and more severe sanctions are applied to those who produce low-quality products. Because the practice shows that the use of symbolic financial sanctions did not give any results.

Currently, the maximum amount of fine sanctions is 5,000 manat (previously was 250 manat). The fine is imposed both to the company and its leadership. However, it needs to toughen up the penalties. One of the main proposals is that the enterprises should be fined in amount of total cost of product, of which quality does not meet international standards. For example, if the company produces products totaling 1 million manat, after withdrawal of these products from sale, the company should pay fine in this amount.

The aspiration of domestic producers to achieve success with regards to manufacturing quality products is obvious, but the existing state-level problems in the field of quality standards make it difficult to develop local production for the domestic market.

For example, the absence of an etalon center, independent laboratory and strict work regime of the system on control over the quality of the product in Azerbaijan slows down the process of improving the management of product quality. In Azerbaijan, a food testing laboratory will be put into operation only in 2010, and the National Etalon Center of Azerbaijan only carries out preparatory work to provide services. As noted above, in Azerbaijan there is no structure directly responsible for the disparity of quality standard of domestic products and presence of low-quality commodities of foreign products on local market.

According to the Ministry of Economic Development of Azerbaijan, one third of product, including products imported, on the local market does not correspond to the standards of quality and safety. This figure is a high indicator for Azerbaijan. The main problems on the market are not the compliance with the standards of packing, storage and sale of goods, not adherence to sanitary - hygienic norms.

There is another problem. After joining the WTO, Azerbaijani market will be opened for import of products from approximately 150 member countries of the organization. At the same time, Azerbaijan is not insured from import of poor quality goods into the country.  Consequently, along with strengthening control over the quality of local goods, it is necessary to improve the technical specifications of products supplied from abroad. This practice is introduced in the Western European countries and the United States. The duties on import are not high there, but because of technical requirements, it is difficult to export goods to these markets.

Undoubtedly, the result of introduction of international standards ISO 9001 in the industrial enterprises is obvious. Firstly, the companies appear an opportunity to enter the world market, secondly, there is a chance of winning the competition, and thirdly, there are conditions for the coordination and improvement of not only production, but also the entire management process. But, despite the introduction of international standards, in most of domestic companies, the quality management system does not work or works insufficiently.

A question appears, why do not the investors, investing in the certification and standardization, use more positive quality management in their activities? The investors, referring to the fact that standards ISO 9001 have no strict regulation, refuse to introduce it.

Despite large number of proposed methods in the press, none of them has found practical application.
There is another important element of quality management system, which unfortunately does not exist in Azerbaijani enterprises - it is the involvement of staff in the process of quality management, their role in achieving ultimate goals of the enterprise.

But the most difficult problem, which negatively affects the quality of all work, is the lack of skilled workers. Difficulties primarily arise in finding a good consulting company, specialists, who could explain to the staff the modern trends in the development of quality management, train the staff the major international quality management techniques, make them interested in achieving higher levels of quality.

Thus, other situation appears: the enterprise, investing considerable money in the certification, gets international quality certificate, but the quality system in the organization is not working. Producers lose more money, consumer confidence and market share from such discrepancies. As a result, the quality of the Azerbaijani products does not correspond with international standards.

Successful realization of the quality product is the main source of existence of any enterprise. The history of many foreign companies is a clear confirmation of this. Companies such as McDonald's, Delta Airlines, Siemens show a good example of this dependence. With the help of modern methods of quality management, the advanced foreign companies have achieved leading positions on various markets.