There also is empirical evidence of declining product quality — evidence that Barbara Tuchman didn’t have at her disposal back in 1980. Since 1994, for example, the American Society for Quality and the University of Michigan have cosponsored the American Customer Satisfaction Index (ACSI), based on customer surveys. Overall, ACSI ratings of manufactured goods have basically held steady over time, but exceptional companies (notably Dell and Apple, with satisfaction increases of 9.7 percent since 1997 and 5.2 percent since 1994, respectively) skew the results. Other big-name companies show deterioration, including companies that have invested millions of dollars in associating their brands with reliability and quality: Hewlett-Packard is down 9 percent in customer satisfaction since 1994, and several appliance manufacturers are down more than 4.5 percent. Even Six Sigma mainstay GE is down 2.5 percent. (A full table of this company data can be found at www.theacsi.org.)
Consumers Union, the nonprofit publisher of Consumer Reports, has kept track of product reliability through its consumer surveys of repair data. It also tracks the frequency of product recalls, which have risen steadily since 1990. Here, the trends are suggestive but inconclusive. Senior Editor Tod Marks, whose beat at Consumer Reports includes repair and reliability, notes that quality in many product categories is better overall than it used to be. (When was the last time you experienced a tire blowout or a picture tube failure?)
Still, many product manufacturers have lowered engineering standards to shave their costs. “One thing that often goes wrong with a videocassette recorder is the loading mechanism,” Mr. Marks says. “That used to be metal, attached with screws. Now it’s a piece of extruded plastic fused to the chassis.”
The most solid empirical evidence on product quality involves warranty statistics, such as the number of units returned each year to retailers (and hence to manufacturers) for repair or replacement under warranty. But the Financial Accounting Standards Board began requiring manufacturers to disclose this information only in early 2003, and there has never been any systematic analysis of warranty costs as a percentage of revenues. However, three veteran quality consultants told me that the number of warranty returns they see, particularly in the computer and electronics industries, is rising.
“It’s happening on so many dimensions,” says Greg Brue, president of Albuquerque-based Six Sigma Consultants and author of Design for Six Sigma (McGraw-Hill, 2003). “Companies are going to shorter and shorter warranties, and dealing with more and more repairs, and responding with rebates and price promotions instead of improving their products — and they feel like they’re getting away with it.”
People at both Consumers Union and ACSI argue that products aren’t necessarily getting worse. Indeed, technical conformance to standards is going up, says ACSI Managing Director David Van Amburg. It is just that “customer expectations are going up faster than the ability of the companies to meet them.” This doesn’t fully account for either the statistics or the stories, however. In the end, only one conclusion seems to fit: In every product category, a few good brands continue to improve their durability and reliability. The good get better, and the rest get worse.
A consumer advocate might argue (as many did back in the 1970s) that the culprit is planned obsolescence. Companies deliberately design shabby products so customers will keep replacing them with new ones.
But reality is not so simple. Consumers themselves tolerate irritating product failures and flaws far more than they used to, even when they have more channels (such as the Internet) through which to voice complaints. Presumably, consumers’ tolerance for poor product quality and short-lived products is higher because it costs less today to replace a broken toy, cordless drill, or VCR. As Tod Marks of Consumer Reports observes: “In the early 1990s, we found that if a product cost $30 or less, people wouldn’t bother to get it fixed. But as the years went by, that price point has steadily gone up — now, it’s probably at about $100.”