3.4.4 Making operational decisions to improve performance: improving quality Flashcards
What is Quality?
a measure of the worth of a product, for example its durability, reliability, or reputation
State reasons why quality is important to a business.
Gaining a competitive advantage
Impact on sales volume
Impact on selling price
Cost reductions
Brand loyalty and reputation
What are methods of improving quality?
- Quality Control
- Quality Assurance
- Total Quality Management (TQM)
- Quality Benchmarking
- Kaizen
What is quality control?
the process of inspecting products to ensure they meet the required quality standards (check the product at the end for any mistakes)
How is quality control achieved?
At its simplest, quality control is achieved through inspection. For example, in a manufacturing business, trained inspectors examine samples of work-in-progress and finished goods to ensure standards are being met.
What is quality assurance?
the processes that ensure production quality meets the requirements of customers (continuation of checking at each stage of production)
What is Total Quality Management (TQM)?
a specific approach to quality assurance that aims to develop a quality culture throughout the firm. In TQM, organisations consist of ‘quality chains’ in which each person or team treats the receiver of their work as if they were an external customer and adopts a target of ‘right first time’ or zero defects.
What is Quality Benchmarking?
a general approach to business improvement based on best practice in the industry, or in another similar industry. Benchmarking enables a business to identify where it falls short of current best practice and determine what action is needed to either match or exceed best practice. Done properly, benchmarking can provide a useful quality improvement target for a business.
What is kaizen
an approach of constantly introducing small incremental changes in a business in order to improve quality and/or efficiency. This approach assumes that employees are the best people to identify room for improvements, since they see the processes in action all the time. A firm that uses this approach therefore has to have a culture that encourages and rewards employees for their contribution to the process.
Explain quality circles
1) Quality circles meet at regular intervals to discuss quality control issues.
2) They use the knowledge of employees from various departments and all levels of the organisation.
3) Quality circles aim to identify and solve specific quality problems that arise.
4) They are a great way to get staff involved and can lead to increased motivation and productivity.
5) However, suggestions can often be unrealistic and management may not listen to the floor staff.
What are advantages of quality control?
- With quality control, inspection is intended to prevent faulty products reaching the customer. This approach means having specially trained inspectors, rather than every individual being responsible for his or her own work.
- Furthermore, it is thought that inspectors may be better placed to find widespread problems across an organisation.
What are disadvantages of quality control?
- Individuals are not necessarily encouraged to take responsibility for the quality of their own work.
- Rejected product is expensive for a firm as it has incurred the full costs of production but cannot be sold as the manufacturer does not want its name associated with substandard product. Some rejected product can be re-worked, but in many industries it has to be scrapped – either way rejects incur more costs,
- A quality control approach can be highly effective at preventing defective products from reaching the customer. However, if defect levels are very high, the company’s profitability will suffer unless steps are taken to tackle the root causes of the failures
What are the advantages of quality assurance?
- Costs are reduced because there is less wastage and re-working of faulty products as the product is checked at every stage
- It can help improve worker motivation as workers have more ownership and recognition for their work (see Herzberg, in other words a motivating factor).
- It can help break down ‘us and them’ barriers between workers and managers as it eliminates the feeling of being checked up on
- With all staff responsible for quality, this can help the firm gain marketing advantages arising from its consistent level of quality
What is a disadvantage of quality assurance?
Quality assurance can result in products only being ‘acceptable’, not of a high standard.
What are the consequences of poor quality?
- Reputation
- Lower sales volume
- Lower price
- Lower profits
- More waste
- Increased costs
