Continuous Quality Improvement as a Survival Strategy: The Southern Pacific Experience

Abstract

Can Continuous Quality Improvement (CQI) be used to turn around a company in serious trouble and fighting for survival? Southern Pacific Lines believed the only available strategy for survival was to rapidly implement a CQI program that would produce sufficient results within five years for the company to achieve a successful turnaround. This article reports on the considerable success of the first two years of their program. From 1991 to 1992, a recession year that was particularly severe in the West, Southern Pacific's bottom line improved by $43 million.