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The cost of poor service and poor quality. presentation

Anonim

The culture of an organization develops with daily and repeated experiences, transforming itself over time as a function of behavior and attitudes assumed at work, whether internal or external to the organization (Nanda, 2007).

If there is job dissatisfaction, it is possible that the image of the company and the quality of its products and services will deteriorate, lowering the levels of productivity and quality, slowing down the growth and development of the organization (Morales, 2008).

the-cost-of-bad-service-and-poor-quality

Consequences:

Lost customer income, which is money that is not earned when customers start doing business with competitors, there is an opportunity for lost income, which is the potential money that is lost with customers who are dissatisfied, or when his former clients tell their friends not to do business with the company.

Cost of replacement of clients: it is the cost of acquiring new clients, to calculate the cost of a bad service it is necessary to know the annual income, the current number of clients and their current acquisition cost, also determining how many clients are lost and what is the average income per customer of your company, (Schein, 2009)

Use of more material and raw material.

Excess inventories.

Excessive use of equipment, machinery and maintenance.

Rejected purchases.

Bad image for the company.

Performance cost: related to doing things right on the first try, associated with producing something error-free that doesn't need to be reprocessed.

Rework or Failure Cost: Cost of doing something again, repairing, redoing, and correcting faults can represent up to 50% of your cost of doing business.

Detection Costs - Includes inspection costs, wages, and any other extra procedures that help detect problems before they leave your plant.

Prevention and detection costs: By identifying quality flaws before they reach what is normally called quality inspection or quality control, these are minimized when each worker is able to inspect their own work.

Price: If the quality and service are better, your clients allow you to charge more for the goods and services offered.

Utilities: true quality (obtained by preventing mistakes and doing it right the first time, and according to the expectations set by your customers) leads to cost savings and increases in sales, the result, especially when combined with prices higher, is to increase profits.

Market share: Quality means more market share. If you are charging more for your services or products, people are happy to pay the price, simply because they know they are getting quality and value for their money.

Poor quality increases the cost of production because you have to do things again, or make repairs to your customers in hopes of keeping them.

Marketing and advertising: you will be selling more, so the effective cost per sale will decrease, even if you increase your advertising expenses; The second is that your referral marketing will increase, thereby lowering your external advertising costs (Hofstede. 2007).

Cost of customers when doing business with the company, how much time, effort and money does your customer spend to make the first purchase and then return because the product must be repaired or replaced?

Absences.

Staff turnover.

Conclusions:

Similar problems are frequent within organizations, which is why it is necessary to implement and generate an organizational climate that makes the most of human capital, its innovations and, above all, a proactive environment where joy exists and staff do and carry out their activities. In the best possible way, this will allow the company to grow and survive.

Bibliography:

  • Nanda., S. (2007). Anthropology, culture, sociocultural adaptations. Mexico. Iberoamerican Publishing Group. (pp. 55-89).Schein, E. (2009). Organizational culture and leadership. San Francisco.: Jossey. (pp. 90-134).Hofstede. (2007). Organizations and Culture. New York. Mc Graw Hill 2007. (pp. 25-50).
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The cost of poor service and poor quality. presentation