Quality control
To help achieve good quality products, businesses might have a quality control systems where products are checked for any defects. This could involve checking finished products to see how good their quality is or how many defect products have been produced and it can look at whether the production method is good or not. Quality control systems help businesses add quality to their products because they can assure customers that their products are going to work. The advantage of having any quality control system is that the end result should be that less defect products go to be sold to the customer, who will be annoyed if he/she purchases products which do not work how they should do. The disadvantage of all quality control systems is that defective products may still pass the quality control system because of human error, some employees might accidentally not check some products which could be defective products.
Peps quality control system is quite good because samples of products are checked for any defective products, if there are too many defective products in one sample, the whole batch will be thrown away, this way they can be almost certain that their finished products will be of a satisfactory standard, the disadvantage of this I that the samples chosen can give a biased idea of whether the products are good quality or not. For example if all the products chosen for the sample are poor quality products but the rest are good quality products, the whole batch will be thrown away because the sample chosen weren’t good quality, this wastes PEP’s time because they are having to produce products again and it wastes PEP’s money because they have to spend money on getting the new raw materials for the products that shall have to be made again. As well as checking finished products, PEP also check the quality of the materials that shall make the product, this way thy can isolate the problem before the product is made (if the problem is in the materials). These methods for checking products for quality help PEP to add quality to their products and give them a good reputation for having high quality products. When Keith Parker came to PEP he introduced quality circles to help prevent defect products. This will involve regular voluntary meeting between workers and managers (usually 5 to 15 people are involved), they will discuss how well the business is doing in preventing defects and adding quality to their products, they will also discuss how they can improve the quality of their products and how they can decrease the amount of defective products. This discussion will take place during work hours (otherwise nobody will come as it is voluntary) and will include many problem solving techniques (the steering committee will decide on which one’s are appropriate), the techniques used may include studying graphs showing information such as the number of defect product, cause and effect diagrams and also various types of sampling methods could be used to inspect a sample of products. In a quality circle there people from four different types of areas, these are as follows:
- A steering committee- This is one person who organizes the event, this person will also be in charge of finding a place for the discussion top take place and will obtain the resources needed for the discussion.
- Facilitator- every circle will include one of these people, this person will give guidance as to how the problems should or could be tackled.
- Circle leaders- this person will try to get the discussion started by asking questions and creating topics for the others in the discussion to think about, however, this person will not dominate the discussion.
- Members of the circle- these people are the staff that work in the business and it is these people that shall be answering all the questions as they know (or have an opinion on) what the quality of the products and production method is like because they work their.
The advantages of the quality circles is that it allows the staff involved to give their opinions who have a good idea of the conditions and problems of the current system because they run it. It also helps to motivate the staff because they feel a part of the business. The members of the discussions can learn from each other therefore the staff will be more trained and the training didn’t cost the business anything. The disadvantages of this is that arguments can develop between staff because one does not agree with another, this could ruin relations between staff which is not good because the staff would not like working with one another thus degrading their motivation. Another disadvantage is that humans make errors therefore the idea that is agreed could be the wrong one and would therefore would not benefit the business, instead it would make the business operate worse.
Although the quality of PEP’s products is good, the quality of their service is not good, Keith argues that he is sick of PEP’s high quality products not getting the attention they deserve because of PEP’s weak administration and customer service. The business can not always meet delivery deadlines because the members of staff sometimes quote a delivery date to a customer and then not notify anyone to speed up the production process therefore the product cannot be made to meet this deadline.
Other methods to add quality
To improve PEP’s quality and possibly introduce a more effective production method, PEP could use the following:
- Total quality management
- Quality assurance
- ISO 9000
- Bench marking
These are explained below
TQM
TQM (total quality management) is the most complete way of insuring that quality products are produced. This is a continues process which involves all the workforce. Staff will look at how they can prevent a problem from occurring rather than getting rid of bad quality products.
The advantages of this are that the business will have very few defect products which means that the business will waste less money on making products that they can’t sell because of the fact that they are not fit to be sold. Another advantage of this is that everyone in the business wants to create good quality products will not be blamed if they make the wrong decision, therefore they are more motivated because they feel that they have a bigger part to play in the business. Another advantage of this is that TQM looks at how to prevent the problem rather than looking at getting rid of products after they have been produced, if the problem can be prevented before it occurs, it saves the business allot of money because they didn’t have to pay for producing products which could eventually become defective products. The disadvantages of this are that TQM requires staff to be well trained in a wide area of skills, if they are not well skilled, they may make the wrong decisions and pass products that shouldn’t be passed or not pass products that should be passed. Staff must also be committed to increasing quality for the business otherwise the system does not work. Hydropwer use this method, they claimed that they received the following benefits: managers more ware of the need to involve staff in problem solving and decision making, staff are more participatory and enthusiastic about their work, new benches were designed to make work easier, new safety test procedures introduced to test hoses, a new and more efficient telephone system was installed, quality action team research resulted in shorter lead times, Hydropower’s trade counter has improved customer service and BSI inspectors reduced visits by 50%.
Quality assurance
This is almost the same as TQM only it does not go into as much depth. In the quality assurance system a group of committed people look at the quality of the product, like the TQM system, this system also looks at how problems can be avoided rather than throwing away the defective product. Mc Donalds use this system, they check the product after every stage of production, this allows them to add quality to their product while also adding value to it. If PEP were to use this system, their would be a high chance that their defective products would not be sold to customers and they could be sure to isolate any potential errors in any product very early in the production stage. This would advantage PEP because they would not be wasting their time and money on making a finished product that is defective. However, this problem only looks at throwing away defective problems, it does not look at how these problems occur and what could be done to prevent these problems in the future so that defective products aren’t given the chance to develop
ISO 9000
As quality increases, businesses are constantly looking for suppliers who can provide good quality products, which is why businesses are looking to find suppliers who have the ISO 9000 certificate. The ISO 9000 certificate shows that the business is producing good quality products because they follow the rules set out by the makers of the ISO 9000 system. The advantages of this system is that customers would be more likely to purchase products from you rather than a competitor because they can be assured that the product that they are purchasing is a good quality product because of the ISO 9000 certificate. Another advantage is that it saves costs because fewer defect products are produced which have to be thrown away. The disadvantages of having the ISO 9000 system is that it is time consuming to follow all the rules and because of this less products will be produced which means that it is harder for the business to meet delivery dates. Another problem with the ISO 9000 system is that the staff will need to be trained to know what the rules of the ISO 9000 system are and how to implement them which will require money, the ISO 9000 system is always altering their rules which is why the businesses following the ISO 9000 system will have to continually be checking the ISO 9000 standards and training it’s staff the new rules when appropriate which wastes the businesses time and money. This would benefit PEP because they would have proof that their products are high quality which has always been one of their objectives. They would also be able to attract the right market for them (businesses wanting to pay high prices for a high quality product) therefore they could charge high prices and expect customers to pay the price because the customers can be assured from the ISO 9000 system that the products that PEP is producing are of high quality which allows PEP to add value to their products thus allowing them to add value to their products.
Benchmarking
Benchmarking helps businesses keep up to date with the newest and the most effective methods used to achieve high quality products. Businesses will compare themselves to their leading competitor, they will look at how they produce products and which methods they use to achieve good quality products consistently, the business will then use this method to produce their products or they might improve on the production method used by the leading competitors. Benchmarking will also look at what customers think is the best method to produce products, if the business goes along with this method then they can be assured that the customers will be pleased to purchase their products because the customers consider the production methods to be the best ones. The advantages of this are that not much thought is required because most of the information taken is either from the market leaders or from the customers. The disadvantages of this are that research is needed to find out the market leader’s production methods and the customer’s idea of good a production method which requires money. Another disadvantage is that the best production method is always changes as suppliers continually do research through the benchmarking process and through other methods to try and get a advantage over competitors by using a better production method, therefore benchmarking has to be done regularly for suppliers to keep up which costs the business time and money. PEP would benefit from this because their production method is not good (claims Keith Parker) therefore they could look at the methods that the leading competitor uses.
Powergen use this method, they claim that from it they enjoyed high profit increases from it when they looked at American power generators. From the benchmarking that they did, they were able to design a method that gave them the following benefits: a staff reduction from 1,100 which means that less money has to go out of the business on wages, better jobs for the employees that remained therefore the employees are more motivated to do their jobs, maintenance costs reduced by 66% which increase profits because less money is money is being spent on this area and finally the workforce ended up became skilled in more than one area which motivates them more. If PEP was to use benchmarking and use it effectively, they too could be enjoying these benefits.
