Quality Management: Definition & Techniques I StudySmarter

You do not install quality; you begin to work at it.”

– W. Edwards Deming

Quality is one of the highly significant principles of management. A company that maintains quality in every aspect will have customer loyalty, consistent cash flows, and an edge over its rivals. Let’s take a look at the importance of quality management and the consequences of poor quality.

Quality Management Systems

Quality management is overseeing all the activities that should be carried out to uphold a desired level of excellence. This may include the determination of policies for quality, the creation and implementation of quality plans, quality control, and improvement.

Quality management is considered crucial for the performance and progression of any organisation. Therefore, quality should be upheld at all levels in order for the organisation to flourish. Organisations may introduce quality management systems that will guarantee the quality standards of their products are maintained, with the aim to boost customer satisfaction and increase growth. Let’s look at some of the reasons why quality systems are important.

• Consistent quality of the product

• Accomplish customer satisfaction

• Greater levels of productivity

• Lower potential risks

• Reduce human errors

Quality improvement in organisations can be done by assessing the methods implemented over a period of time. There are several quality management systems or models that can assist in the collection and analysis of data. Though it’s vital to select a reliable QI model for guidance, it’s more significant that the organisation completely commits to using overall QI processes and practices. Two examples of quality improvement may be observed through Toyota and Unilever:

Despite some setbacks in the previous years, Toyota’s rise to be the best in the auto industry may be attributed to one factor: quality. One of the main reasons for its unparalleled quality is because its front-line workers participate in the improvement process.

Toyota does it through three components. Firstly through a culture that encourages and inspires its on-floor workers to recommend local improvements. Management has developed a relationship on the basis of joint trust, confidence, and respect for their workers. Secondly, Toyota has a clear management process that allows the suggestions made by workers to reach top management. It has defined a standard process to perform work as a reference point for improvement and to make sure the objectives of the organisation are embedded in the front line.

Lastly, it is the role and skills of employees that allows Toyota to make improvements. On-floor workers know the actual worth and value of every standard process and they possess the skills and knowledge to solve problems.

Unilever uses its internal quality business school to allow its employees to develop profound quality expertise and essential business skills and therefore, ensure to provide top-quality, reliable, and sustainable products to their customers. Unilever also takes into account the viewpoints of its customers be it positive or negative. It often asks its customers to give feedback on their brands via its customer engagement centres, reviews, and rating on social networking sites.

Quality Management Strategies

Let’s take a look at the different forms of quality management strategies.

Quality Control

Quality control is a form of inspection that makes sure products are up to quality standards.

Quality control is necessary for developing a business that offers products that meet or surpass the expectations of customers. It also builds the foundation of an efficient organisation that lowers waste and functions at a higher level of productivity.

Traditionally, quality inspectors in a company used to assess the accuracy of finished work and also check the quality of materials sent by the suppliers. This approach was considered as it was believed that several employees would not be willing to take the responsibility for poor quality and expert employees were needed to identify the suitability of a good for consumers.

Advantages of inspection

• Quality control can avoid defective products from reaching customers.

• It is less risky than trusting each individual employee to do the quality control aspect of production themselves.

• Common issues will be detected by inspectors in the company; therefore, errors can be corrected in an efficient manner.

Disadvantages of inspection

• A worker who is involved directly in production should be the one responsible for the quality of a product rather than an inspector.

• If the responsibility lies on the inspector to check the quality, then it will not motivate the worker to enhance the quality of their output.

• The hiring of inspectors will be considered as an unnecessary expense if products are up to quality standards the first time.

Quality Assurance

Quality assurance is a systematic method to determine if the goods or services match precise requirements.

Due to the above-mentioned disadvantages, businesses have moved from quality control to quality assurance. This includes a change from assessment by inspectors to self-assessment. While quality control is a product-based process, quality assurance is process-based. Quality assurance is important because it ensures that the production process of a product aligns with the quality requirements and standards. The significance of quality assurance is that it ensures that finished products fulfil quality requirements.

Advantages of quality assurance

• A worker will have a sense of ownership and responsibility for the product instead of an inspector.

• It will decrease costs as there is less waste and less reworking needed for the faulty products.

• If the whole workforce is responsible for checking quality, there will be a greater and more reliable level of quality.

• Since quality assurance makes workers responsible for their work, they should also be allowed to discard any product that is not completed properly or below the standard that they received from a person before them. A worker will not want to be blamed for a faulty product if the fault was made by the person before them. This leads to an effective method, as inspection happens at the start and end of each production process, hence decreasing the likelihood of a faulty product.

Total Quality Management Definition

Total quality management (TQM) is a form of quality assurance.

Total quality management (TQM) can be defined as a management approach that engages all employees in constant improvement. TQM is almost embedded in organisational culture.

It utilizes strategy, data, and efficient communication to incorporate quality discipline into the culture, values, and activities in an organisation.

Some of the benefits of TQM include higher productivity, diminishing costs and improved cost management, greater profitability, growing customer satisfaction, loyalty, and retention.

Kaizen

Similarly, Kaizen is another form of quality assurance.

Kaizen is a method that creates constant improvement, centred on the notion that continuous and small alterations can eventually lead to noteworthy improvements.

It is central to lean manufacturing and is greatly used in Toyota. It was established in the manufacturing sector to decrease defects, reduce waste, improve productivity, motivate worker purpose and responsibility and encourage innovation.

Some of the benefits of Kaizen include: it promotes teamwork as employees work beyond their departments, fewer errors which lead to less supervision and inspection, it promotes scrutiny of processes with the aim of lowering mistakes and waste.

Benefits and Difficulties of Improving Quality

Quality management comes with its own set of benefits and limitations.

Benefits of Improving Quality

Improving the quality of a product/service a business can lead to the following benefits:

• Gaining a competitive advantage,

• Increasing sales,

• Creating USPs (unique selling points),

• Reducing costs,

• Brand loyalty and improvement in the reputation of the company.

Difficulties of improving quality

• It might be difficult to agree on the best solution for a problem, specifically if it affects employees.

• Several quality systems give more responsibility to workers. This might require modification in their management and their approach to work. These modifications might not be accepted by all the workers.

• Resisting change might be ingrained in company culture and overcoming this resistance might prove difficult.

• Improving quality can be very costly. Some of the costs may include training staff, developing quality systems which will lead to an increased administrative burden, updating information systems and installing new equipment for testing quality.

The Consequences of Poor Quality

Poor quality products and services might reflect negatively on a company. As a result, it may lead to various consequences including:

The Reputation of a Company

Poor quality products can ruin the reputation of a company. This will be damaging as customers are more likely to remember negative rather than positive news. A company that has no rivals might not suffer severely as customers do not have any other alternatives. However, in a competitive situation, poor quality can have drastic effects, particularly if the company’s reputation is based on quality.

Decreased sales

If a product is not able to match the standards of the customers, then there will be a decrease in the demand for the product. For certain people, quality is considered a significant factor. So, poor quality will negatively impact future sales.

Decreased price

People will only consider buying low-quality products if they provide appropriate value for money, thus the company will be compelled to reduce its prices to maintain sales. Consequently, reducing profit margins.

Waste of resources

Poor quality signifies waste, as products will be rejected if poor quality is detected at later stages.

Increased Costs

There will be costs associated with poor quality such as costs for replacing material, wages paid to workers reworking products, cost of time spent transporting and checking recalled products, time for dealing with customer complaints, money wasted on products that will be discarded, and loss of reputation and goodwill of the company.

Improving Quality

Here are some of the ways in which organisations can further improve quality:

A Comprehensive Quality Inspection Program

Quality inspection is crucial in the process of manufacturing as it ensures a precise product design. It is generally the last opportunity for the manufacturer to detect any faults in design before the product is shipped, thus a detailed inspection process is important.

Tracking Errors

If an organisation is dedicated to quality, it first needs a clear definition of what quality is. Once that is determined and standards are set, a comparison can be made between current practices and the quality standard. If there are a lot of differences then changes need to be made to produce the product up to the accepted standards in the organisation.

Investment in Training

It is vital that workers are shown the history of the organisation via the lens of quality. Workers should be able to understand the problems faced by the organisation in the past, how they were resolved, and the significance of quality for the organisation today. The definition of quality and its measurement needs to be explained in detail. It is also essential to show the connection of an individual’s actions to the overall performance of the organisation.

Arrange Quality Circles

Organizing and arranging employees into quality circles can be an efficient approach to recognizing and tackling problems. In quality circles, a set of employees are motivated to evaluate processes and suggest improvements, with the aim to promote quality, proficiency, and productivity.

Quality Management Techniques

The main quality management techniques include:

Benchmarking

Benchmarking is the process of taking performance metrics from the organisation and comparing it with those of industry leaders.

This may lead to issues being identified more accurately and as a result targets for performance enhancements can be developed and applied.

Identifying Quality Issues

Both employees and management should consider quality issues as an opportunity for improvement. The organisation should view identifying issues that exist in the processes as a positive thing.

Continuous Improvement Process

The continuous improvement process involves the ongoing enhancement of products, services, and processes. Rather than implementing large changes all at once, businesses should focus on implementing smaller changes continuously.

Over the decades quality management has become a vital part of organisations as they have realized its importance and the benefits it brings. Nowadays, organisations are searching for advanced approaches and methods that will improve the quality of their products/services. This will eventually increase sales, increase customer satisfaction and customer retention, and growth and development for the organisation.

Improving Quality – Key Takeaways

• Quality improvement (QI) is a methodical, formal process of evaluating and improving performance in a business.
• Quality control is necessary to ensure that products meet or surpass the expectations of customers.
• Quality control advantages are: defective products will not reach the customer, creating a secure system and detecting common problems early on.
• Some of the disadvantages of quality control are that workers are not made responsible for their output, workers are not motivated to improve quality, and hiring inspectors increase the expenses of the company.
• Quality assurance is a continuous effort of improving quality practices.
• Some of the advantages of quality assurance are that workers take ownership of their work and costs decrease as less waste is produced and less rework is needed.
• Total quality management (TQM) can be explained as a management approach that engages all employees in constant improvement. TQM is almost embedded in organisational culture.
• Kaizen is a method that creates constant improvement, centered on the notion that continuous and small alterations can eventually lead to noteworthy improvements.
• Benefits of improving quality include gaining competitive advantage, increasing sales, reducing costs, USPs, brand loyalty, and reputation.
• Difficulties of improving quality are that it might be difficult to agree on the best solution, resistance to change may occur and improving quality can be costly.
• Consequences of poor quality are decreased reputation, lower sales & prices, wastage of resources and increased costs.
• Quality management strategies include developing a comprehensive quality inspection program, tracking the mistakes, investing in training and development, and arranging quality circles.
• Quality management techniques are benchmarking, identifying quality issues, and continuous improvement processes.