FINAL PT 2 Flashcards
Prevention Costs
Costs incurred to prevent defects from happening
Appraisal Costs
Costs incurred during the process to monitor quality
Prevention Cost Examples
Training and Development, Product Design
Appraisal Cost Examples
Testing and Inspection, Quality audit
Cost of Quality =
Control Costs + Failure Costs
Internal Failure Costs
Defects discovered BEFORE reaching customer
External Failure Costs
Defects discovered AFTER reaching customer
Internal Failure Cost Example
Lost capacity, inc cycle times
External Failure Cost Example
Customer Service, warranties
Cost increases as…
The product moves through it’s cycle
Every Organization, Person, Product, and/or Service is Part of
The Supply Chain
Basic Components of a Supply Chain
(CS RWDFR) Customer, Service Provider, Retailer, Wholesaler, Distributor, Factory, Raw Materials
Customers define:
Product, Demand, Distribution
Customers
Public, Business, Govt, or any Component Within the Supply Chain
Service Provider
Typically provides people or a nonphysical product
Retailer
Has a place of business to provide direct sale of goods in small quantities to the public for use or consumption rather than resale
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Wholesaler
The sale of goods to anyone other than a standard consumer
Distributer
distribute goods in large quantities and have exclusive rights within a given territory
Factory
Business that produces materials/final product that is either used in other products or sold directly to consumers
The More Complex a Supply Chain Becomes,
THE HIGHER THE RISK
Procurement vs Purchasing
Procurement is purchased in BULK from wholesalers/distributers
Job of Stocking/Distribution?
Delivery to the shelves, kits, and internal consumers of the product
2 Ways to manage the Supply Chain:
By Inspection (less communication), by Certification (robust communication)
