Chapter 20 – Achieving Quality Production

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Cambridge IGCSE Business Studies • Chapter 20

Achieving Quality Production

This chapter explains what quality means, why good quality matters, how poor quality damages a business, and how businesses use quality control, quality assurance, Total Quality Management, quality circles and quality marks to improve goods and services.

QualityPoor qualityQuality controlQuality assuranceTQMQuality marks

Topic 1: Understanding Quality

Quality means meeting customer expectations, not simply producing expensive or luxury products.

1. What Is Quality?

Quality means producing a good or service that meets customer expectations.

Quality does not necessarily mean an expensive or luxury product. A low-priced product can still be good quality if it:

Customers usually expect more from an expensive product than from a cheaper one.

Quality means meeting customer expectations: working properly, having no faults and being fit for purpose.

2. Quality in Goods and Services

Manufactured Products

For a manufactured product, quality may involve good design, no defects and meeting customer expectations.

Service Businesses

For a service business, quality may involve good customer service, acceptable waiting times, convenience and meeting customer expectations.

3. Why Quality Is Important

Good quality can help a business:

Build a Good Reputation

Satisfied customers are more likely to recommend the business.

Increase Customer Loyalty

Customers may return and continue buying the same brand.

Increase Sales

Good quality can attract both existing and new customers.

4. Problems Caused by Poor Quality

Poor quality can cause:

Loss of Customers

Customers may switch to competitors.

Higher Costs

The business may have to replace faulty products, repair products or repeat poor services.

Bad Reputation

Dissatisfied customers may tell others about their experience, reducing future sales and profit.

Topic 2: Quality Control

Quality control mainly detects faults before the customer receives the product or service.

5. Quality Control

Quality control involves checking products or services for faults, traditionally using quality inspectors.

Inspectors may check samples during or at the end of production and identify defective products before they reach customers.

Examples

6. Advantages of Quality Control

Two important advantages are:

  1. Faulty products may be detected before sale. This reduces the chance of customers receiving defective products.
  2. Workers need less responsibility for checking quality. Inspectors carry out the main quality checks, so less quality-checking training may be required for production workers.

7. Disadvantages of Quality Control

Three important disadvantages are:

  1. Inspectors are expensive. The business must pay specialist employees to check products.
  2. It detects faults rather than their cause. Finding a defective product does not necessarily explain why the fault occurred.
  3. Waste may be high. Faulty products may need to be scrapped, repaired or produced again.

Topic 3: Quality Assurance

Quality assurance tries to prevent defects by checking quality throughout the production process.

8. Quality Assurance

Quality assurance involves checking quality standards throughout the production process, with employees responsible for checking the quality of their work.

The aim is to prevent defects rather than simply detect them afterwards.

Quality assurance may consider:

Quality control detects faults while quality assurance prevents faults.

9. Advantages of Quality Assurance

  1. Problems are identified earlier. Faults can be corrected before the product reaches the next stage of production.
  2. Fewer customer complaints. Products are more likely to meet customer expectations.
  3. Lower waste costs. Fewer products need to be scrapped, repaired or produced again.

10. Disadvantages of Quality Assurance

  1. Training costs. Employees need training so they can check the quality of their own work.
  2. Depends on employee commitment. The system will not work properly if employees do not take responsibility for maintaining quality standards.

11. Quality Control vs Quality Assurance

Quality ControlQuality Assurance
Mainly detects faults.Aims to prevent faults.
Inspectors usually check quality.Employees take responsibility.
Often focuses on finished output.Quality checked throughout production.
Faults may already have been produced.Problems can be corrected earlier.
Quality Control = DetectQuality Assurance = Prevent

Topic 4: Total Quality Management, Quality Circles and Quality Marks

Modern quality management focuses on prevention, continuous improvement and recognised standards.

12. Total Quality Management (TQM)

Total Quality Management (TQM) is the continuous improvement of products and processes by making quality important at every stage of production.
The aim is: Right first time – zero faults.

Everyone in the business is responsible for quality, not just inspectors.

Total Quality Management involves quality at every stage, all employees, continuous improvement and customer satisfaction.

13. Main Features of TQM

TQM involves:

14. Advantages of TQM

  1. Fewer defects. Problems are prevented before reaching customers.
  2. Lower costs. Less waste, reworking and replacement are required.
  3. Better reputation. Fewer complaints can improve brand image and increase sales.

15. Disadvantages of TQM

  1. Training can be expensive. All employees may need training.
  2. Requires commitment from everyone. TQM will not work effectively unless employees accept responsibility for quality.

16. Quality Circles

Quality circles are groups of workers who meet regularly to discuss production problems, possible improvements and ways to reduce waste and defects.

They support ideas such as TQM and Kaizen because workers are involved in improving quality.

Workers meet→Discuss problems→Suggest improvements→Reduce waste and defects

17. Quality Marks

A quality mark shows that a product or business has met particular recognised standards.

To obtain a quality mark, a business may have to:

The chapter gives ISO as an example of an organisation that provides recognised quality standards.

Benefits

A quality mark may:

Topic 5: Quality in Service Businesses and Exam Focus

Quality-management methods apply to services as well as manufacturing.

18. Quality in Service Businesses

Quality is just as important for service businesses as for manufacturers.

A service business may improve quality through:

Service quality can improve through staff training, clear service standards, monitoring and customer feedback.
Result: Satisfied customers may return, recommend the business and give positive reviews. Poor reviews can damage reputation and reduce future sales.

Key Definitions

TermMeaning
QualityProducing a good or service that meets customer expectations.
Quality controlChecking products or services for faults using inspectors.
Quality assuranceChecking quality standards throughout the production process.
TQMContinuous improvement with quality responsibility at every stage.
Quality circleGroup of workers who meet to discuss quality problems and improvements.
Quality markRecognition that a product or business meets specified quality standards.

What Students Must Know for the Examination

Students should be able to:

  • define quality
  • explain why good quality is important to a business
  • explain problems caused by poor quality
  • define and explain quality control
  • explain important advantages and disadvantages of quality control
  • define and explain quality assurance
  • explain important advantages and disadvantages of quality assurance
  • distinguish between quality control and quality assurance
  • explain the basic idea of TQM
  • understand briefly how quality circles contribute to quality improvement
  • explain why a business may want a recognised quality mark
  • apply quality-management methods to both manufacturing and service businesses.
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