Graniterock, a California-based mining and construction company, was founded in 1900, but its journey toward improved quality did not start until many decades later. The managers at Graniterock knew that a resulting decline in customer satisfaction was inevitable and responded to this self-assessment by deciding it needed to become more customer focused. At Graniterock, this meant not only learning more about the customer but also providing its employees the training and skills necessary to properly implement the company's new philosophy. At first, this focus on HR management was emphasized through employee training. As explained by ex-CEO Bruce Woolpert, you can't have employees out telling customers "yes" unless everyone else in the company knows how to follow up on "yes." As a result, an aggressive training program was implemented, involving on-the-job training and classroom time for a majority of the firm's employees. A program called IPDP (Individual Personal Development Plan) was created to help each employee take responsibility for his or her own training program. As the program gained momentum, remarkable things started to happen. One employee
indicated that he wanted to learn to read better.
As a result of that request, the company initiated a reading
program that has helped a number of Graniterock's
employees improve their reading skills. As part of the
company's effort to reduce process variability and increase
product reliability, many employees were trained
in statistical process control, root-cause analysis, and
other quality-minded competencies. Today, Graniterock
spends up to $1,600 per year for training of each employee,
which is more than 10 times the average for the
mining and construction industries.
 

An equally important step in equipping its employees
to contribute to the firm's efforts was establishing
an atmosphere of trust between management and the
rank-and-file employees. That effort has been pursued
in a number of ways, and the trust developed throughout
the company has resulted in the effective implementation
of employee empowerment and teamwork.
In addition, the company has done away with its conventional
performance-appraisal system (feeling that it
was ineffective) and has incorporated performance appraisal
into each employee's IPDP. As part of this plan,
each employee meets with his or her supervisor at least
once per year to discuss job responsibilities, review accomplishments,
assess skills, and set skill and career
development goals. Although the IPDP is not mandatory
for the company's unionized workers, overall participation
stands at 83%. Because the IPDP approach
to training and appraisal prepares employees to assume
greater responsibilities, Graniterock promotes heavily
from within.
Graniterock, having won the Malcolm Baldrige
award and one of Fortune magazine's best 100 companies
to work for, is aggressively pursuing its quality
initiatives, with the cooperation of its 700 employees.

Discussion Questions
1. Rather than focusing on human resource management
(HRM) as a means of supporting its quality
initiatives, Graniterock could have chosen another
area as its focal point (e.g., marketing, operations,
information systems, and so on). How does a focus
on HRM support a company's quality initiatives?

2. Discuss the different components of Graniterock's
HRM initiatives. How can each of these components
support the company's quality efforts?

 

3. Discuss ex-CEO Woolpert's feelings about communication
with the customers (paragraph 2).
What happens when others in the company don't
know what has been promised to the customer?
How can quality management help to overcome
this situation?