What do judges look for when judging entrepreneurs? Ask Paul Steel. He's the president of Total Quality Inc., a quality management consultancy in Seattle that also helps contestants prep for the Malcolm Baldrige National Quality Award. Steel was a senior examiner for the Baldrige Award for five years. He led site visits during four of those years, and he remains active in the program as a member of its alumni association. He's also involved with the European Quality Awards, which is that continent's equivalent of the Baldrige. His own background is steeped in quality control, including stints at Ford, Paccar, and General Systems, another quality management consulting company. Steel spoke with frontier's Ann Therese Palmer earlier this month.

Q: What's business been like?
A: Up until January, we worked with 12 to 15 organizations a year, of which 80% asked us to go on-site [a mock visit by contest judges]. In January, we launched a Web site where companies can access this information over the Internet. There's a menu with various products and services. They select what they want. Since we started the Internet site, it's taken off.

My business is also expanding because of the fact that Baldrige is expanding beyond business organizations to health-care and educational organization categories this year.

Q: What's driving the popularity of these contests?
A: Many organizations are instinctively searching for excellence. But how do you achieve it? In the criteria for the Baldrige Awards, what they found was instead of just looking at operations or suppliers, as Ford tended to do, they look at the management of the company, development of people, use of information, optimizing processes, and delighting stakeholders. Companies around the world are gradually understanding this is how you excel -- not just what you do in the factory.

Q: What's the one area that small businesses usually miss in their application?
A: It's the alignment of their strategies, measurements, and action plans. They communicate these ideas to their employees, they develop measures, but there's always a breakdown between what senior management envisions and what is deployed to the employees at various levels in the organization. I also often see a lack of integration of the management process and the functional activities within an organization.

Q: What's the most important advice you could give a small business considering applying for the Baldrige?
A: Look at the criteria and ask what's in there that isn't important to their organization. What they'll soon realize is that it's all important. They have to develop their people, to satisfy their customers, manage information well. They have to do everything in there and do it well.

Q: Some small companies think the contest criteria are stacked in favor of large organizations. Is that correct?
A: I was involved with the Baldrige from the beginning. In 1988, the criteria were written by people who came from primarily large manufacturing organizations. Initially, there were a lot of complaints that the criteria were written for larger organizations and for manufacturing organizations -- and not for service and small organizations. The Baldrige staff has worked diligently to refine and improve the criteria.

Q: Why don't more small companies apply?
A: You're looking at the tip of the iceberg. Most companies we work with don't have any intention of applying. They're using the criteria to improve. So they don't show up in the count. Some companies don't want to be embarrassed by applying and not winning. In some cases, senior management has a concern that its image could suffer if it applied and didn't win. Others, unfortunately, look at the award criteria as not core to its success.

Of the number of companies that I work with, approximately 25% are applying for the award. Many of the companies I'm working with are looking at the Baldrige for internal use. Sometimes bonuses are based on its use.

Q: Have you been asked to help companies win the Arthur Andersen Best Practices or Ernst & Young Entrepreneur of the Year Award?
A: No, we're a direct competitor and don't expect them to invite us.

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