Quality management

Business A2 · Operations management. The idea in plain words, the rules to remember, the mistake to avoid and a worked example, written and checked by Mega Lecture.

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The idea

A quality product is one that meets customer expectations. It does not have to be expensive: a cheap product is good quality if it does what buyers expect at that price. Good quality brings repeat sales, a stronger brand and lower costs from waste, returns and complaints.

Quality control checks products by inspection, usually at the end of the process, to find faults. Quality assurance sets standards for every stage, so that faults are prevented and each worker is responsible for their own work.

Total Quality Management goes further. It is a culture in which every employee in every department is responsible for quality and aims to get things right first time.

Rules to remember

Quality: a product or service that meets customer expectations and is fit for purpose.
Quality control (QC): inspection or sampling to find defects after they have been made.
Quality assurance (QA): agreed standards at every stage of production to prevent defects.
TQM: everyone is responsible for quality; aims are zero defects, right first time and continuous improvement.
Benchmarking: comparing performance with the best firms in the industry and adopting their best practice.
defect rate (%) = defective units ÷ units made (or sampled) × 100
QA and TQM need training, time and staff commitment, so costs rise first and savings come later.

Common mistake

Students mix up quality control and quality assurance. Control finds faults by inspection; assurance prevents faults by building standards into each stage.

Worked example

A phone maker removes its end-of-line inspectors. Instead, each worker is trained to check their own work against written standards before passing it on. Which method is this, and what is the likely effect on costs?

Checking is now done at every stage by the workers themselves, not by inspectors at the end.
The aim is to prevent faults, not to find them afterwards, so this is quality assurance, not quality control.
Training and writing the standards cost money at first.
Faults are caught early, so less material and labour is wasted on scrapped or reworked phones.

Answer: Quality assurance: costs rise in the short run (training) but waste, rework and returns should fall in the long run.

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