Moneyadviceblog » Business » Understanding Quality Costing (Part 2)

Failing to recognize the importance of quantifying a quality problem and measuring it in terms of monetary values will only waste a considerable portion of a company’s operating budget.

While there will always be some elements that can affect quality to some degree, identifying methods to improve quality is still important.

Ways to Move From Poor to Improved Quality

  • Make a Commitment:

Make a Commitment

The father and founder of the quality movement, W. Edwards Deming, famously laid out 14 points for management – chief among them, the notion of “constancy of purpose.” Deming stated that a company’s devotion to quality had to come from the top, and it had to be improved over and over again. Unless a business considers quality as its single, non-negotiable goal, workers will inevitably feel the need to make trade-offs and quality will slip. “Constancy of purpose means that quality decisions are not situational,” as said by the operational expert Rebecca A. Morgan. “End of the month, quality is the same as the beginning of the month. It means that the long-term benefit of the organization is not sacrificed to hit quarterly targets.”

  • Tracks Mistakes:

Tracks Mistakes

If you are going to focus on improving quality, first you must understand exactly what quality is. For manufacturers, this process revolves around statistical quality control, the process of establishing a product’s specifications and then sampling a small number of units from the production line to see how closely they measure up to those specs. Standards are set and, if too much deviation occurs (or if quality appears to be moving in the wrong direction), the manufacturing process is modified . Tracking quality is admittedly often more complex in a service business, and efforts by groups such as the International Organization for Standardization (known as ISO) to create meaningful benchmarks beyond manufacturing have had mixed results.

  • Invest in Training:

Invest in Training

Quality movement indicated that any business with a quality control department results in poor performance, because it has been demonstrated by every other employee that quality is not his or her chief concern. Instead, quality experts recommended that businesses train emplopyees at all levels to look for ways to reinforce quality and to solve problems. Training takes on several stages . For starters, you should set up a new-worker initiation program that trains employees to focus on quality issues from their first day on the job. Existing workers should be put in charge of training new employees, because they can only provide a firsthand perspective on how your company’s operations work. It is also important that you provide employees with a history of the company through the lens of quality. Inform them what problems you have had in the past, how you solved these problems and where your organization stands with respect to its quality objectives today. You should also go over your definition of quality in detail, and show them how you measure quality. Finally, trained workers can see the relationship between their actions, their work ethic, and subsequently the company’s overall performance.

  • Organize Quality Circles:

Organize Quality Circles

You’ll get many who will roll their eyes at the introduction of such a dated technique, but organizing workers into quality circles can be a very efficient way to identify and solve problems. Simply put, quality circles are groups of workers who are encouraged and motivated to reassess processes and recommend improvements, all with the main purpose of improving quality, efficiency, and overall productivity. This notion was introduced by Deming in post-war Japan and made its way to the United States in the late 1970s. At one point, half of all large organizations had adopted quality circles, but then interest in them faded. To succeed, professionals claim that participation in a quality circle should be voluntary and not coerced; circles should draw members from all corners of a company and the circle should establish its own agenda (rather than just pursuing a company owner’s agenda). Once you have invited employees to join a quality circle, give them adequate resources to pursue their analysis and set a time in the future at which they may set forth their findings. It is crucial that you act on their recommendations, even if the group’s conclusion is not necessarily one you would have drawn yourself.


How do you think quality can be improved?