1. INTRODUCTION
Quality is the basic factor in the customer's decision for a number of products and services that are growing explosively today.
Quality has become the single most important force that leads to organizational success and company growth in national and international markets. Strong and efficient quality program returns are generating excellent profit results in companies with efficient quality strategies. This is demonstrated by significant increases in market penetration, significant improvements in total productivity, much lower quality costs, and stronger competitive leadership.
When the term "quality" is mentioned, we usually associate it with excellent products or services that meet and even exceed our expectations. Such expectations are defined based on the use that will be given to the product or service in question and its respective sale price. When a product improves our expectations we are talking about quality. In other words, it is a quality whose assessment will depend on what is perceived.
According to the A3 - 1987 ANSI / ASQC standard, Quality is the totality of aspects and characteristics of a product or service that allow to satisfy implicit or explicitly formulated needs. The latter are defined by a contract, while the former are defined according to the conditions that prevail in the market, although it is also necessary to determine and define them.
Due to the great variation in quality results, the genuine pursuit of quality success has become a matter of great interest in the management of companies around the world. And the experience is opening a fundamental base to achieve that success.
Quality is essentially a way of managing the organization. Like finance and marketing, quality has now become an essential element of modern management. And efficiency in quality management has become a necessary condition for the efficiency of industrial management itself.
The present work does not pretend to be a complete compilation regarding what quality systems are and the costs that they involve; it is only a brief summary of some important points that companies today should take into account in order to be more competitive in the changing world market.
2. THE SYSTEMS APPROACH TO QUALITY
With so many factors involved in quality management that meets market demands, it is essential that a company and plant have a clear and well-structured system that determines, documents, coordinates and maintains all the key activities that are necessary to ensure quality actions in all pertinent operations of the company and plant.
Without this systematic integration, many companies can lose in what can be considered the internal competence of the company, between, on the one hand, its explosively increasing technological, organizational and commercial complexity, and on the other hand, the skill of its management and administration functions. engineering to plan and control effectively and economically the quality aspects of the product and service of this complexity.
The hallmark of modern total quality systems is their effectiveness in providing a solid foundation for the economic control of this complexity, benefiting both better customer satisfaction with quality and lower quality costs.
Requirements for Current Systems
In its simplest terms, the fundamental concept of modern quality thinking can be described as follows: 'quality must be designed and built into a product; it cannot be put there by conviction or inspection. However, in systematic terms giving operational meaning to this concept by applying the many powerful new quality and reliability techniques in truly effective ways has become a very great challenge.
The systematic challenge to be solved is very great, in part, because the achievement of quality depends on the interactions people - machine - information in all the functional areas of a company. It is very large, in part, that product quality is a very demanding concept for the structure of complex products and services, one that is constantly changing for most services and products. It is very large, in part, because the administrative approaches necessary to operate these systems are not yet being practiced widely enough in industry and government. It is very large, in part, because while it is possible to communicate the ideas of prevention and coordinated quality systems,its applications encounter individual biases and organizational patterns that have often been based on entire lifetimes of policy habits and department mentalities in engineering, manufacturing, and quality control.
Too often, the magnitude of the system requirement to implement sound principles and techniques for quality has been underestimated. In general, the introduction of quality techniques, for the most part, has not been coordinated with the management decision-making system. In these situations, the missing catalyst has been the total quality system.
Definition of the Total Quality System
“A total quality system is the functional structure of work agreed throughout the company and throughout the plant, documented with effective integrated technical and administrative procedures, to guide the coordinated actions of the workforce, the machines and the information of the company and plant the best and most practical ways to ensure customer satisfaction with quality and quality economic costs ”.
The total quality system is the foundation of total quality control, and it always provides the appropriate channels through which the set of essential activities related to product quality must flow. Together with other systems, it constitutes the main flow line of the total business system. Quality requirements and product quality parameters change, but the quality system remains fundamentally the same.
Systems Engineering Approach and Systems Administrative Approach
In quality control, it may be the only missing activity that creates the quality problem. The total quality system provides the company with attention to the integrated and continuous control of all key activities.
This is true whether the issue is one of reliability, appearance, service, fit, performance, or any of the other factors that customers add when deciding on the quality of a product.
Since the effectiveness of each key quality activity in a plant or company can greatly increase or decrease overall quality effectiveness, the key to the modern systems engineering approach to quality control can be established: « A modern total quality system must be structured and maintained in such a way that all key activities - quality equipment, workforce, information flow, standards, controls, etc. - they must be established not only for their own effectiveness but for their concurrent impact on total quality effectiveness. '
This approach indicates that only through improvements through specialized division of effort can large companies be intelligently operated and managed. It is clear that individualized specialization is not a blessing, despite the many outstanding advances it has brought to the industry.
The importance of the modern systems approach is that it adds to the old principle of improvement through division of efforts the complementary concept of improvement through integration of efforts. Actually, the characteristic of modern systems is the fundamental concept of integrated structures and people, information machines to economically and effectively control technical complexity. The bases are cooperation and coordination.
Characteristics of the Total Quality System
There are four characteristics of the technical total quality system that are of particular importance:
- The first and most important, it represents a point of view for consideration on how quality actually works in a modern commercial company or government entity, and how the best decisions can be made. This point of view is about the core quality activities as continuous work processes. They start with the customer's requirements and end successfully only when the customer is satisfied with how the company's product or service meets these requirements.The second characteristic for the technical quality system is that it represents the basis for in-depth documentation and fully thought out, not just a thick book of details,but the identification of the key and enduring activities of the integrated human-machine-information relationships that make a particular activity viable and communicable throughout the organization.Third, the quality system is the foundation for making the broader scope of activities quality of the company is really manageable, because it allows the management and employees of the factory and company to put their arms around their activities of quality, customer requirements - customer satisfaction.The fourth characteristic of a total quality system consists of which is the basis for the engineering of improvements of type of systematic magnitude in all the main quality activities of the company.Since a change in a key portion of the quality work in any part of the company's client-to-client activities will have an effect both on all other parts of the work and on the overall effectiveness of the activity, the total quality system provides the framework and discipline so that these individual changes can practically have an engineering project by its degree of improvement of the total quality activity itself.
3. ACHIEVING A TOTAL COMMITMENT TO QUALITY
The quality of products and services results from the contributions to quality of various individuals with many different technical, production and managerial skills. The center for achieving quality is thus the positive commitment to quality that is fundamental to total quality control programs.
There are many ways in which this commitment evolves with quality and is achieved, depending on the history, policies, personalities, resources, etc., of the company.
Achieving a genuine and widespread commitment to quality is a process that has many dimensions, and one is that it can never be considered "done." A perishable force, subject to continually changing challenges, demands, and unexpected influences from many places, the commitment to quality can be viewed as an ongoing program that is central to total quality control and total quality systems.
Overview of Commitment to Quality
Achieving a widespread commitment to quality involves a very wide range of ongoing activities across all activities in the company's quality program. It is based on a sound quality policy, careful quality planning, and "enlightened" quality management.
Total quality control and total quality systems thus imply a wide range of programs that emphasize ensuring positive motivation towards quality and dynamic quality achievement by company personnel., in at least three fundamental areas:
- The first area is your attitude towards quality. The second area is your knowledge of quality. The third area is your skills for quality.
The scope of these programs may include quality education and training activities, from planned activities to maximize exposure and work experience, to formalized classroom situations, to organized employee participation in solving the quality problem..
Function of Education for Quality
Among the fundamental aspects for achieving a commitment to quality is quality education. The basic administrative objective can be formulated quickly. This objective can be stated as:
"The development for the company's staff - in all functions and categories - of those attitudes, knowledge and quality skills that can contribute to the company's products at the minimum cost, consistent with complete customer satisfaction"
This objective is not new. Long before total quality control programs had garnered widespread attention, plant managers were trying to place more importance on quality training for new operators.
Management's objectives for quality education will be those in which the means to be achieved may vary widely in different periods. There is only one assurance for quality problems: its content is subject to constant change. Therefore, the solution to quality problems will be like a book that is in the process of being written, to which more chapters will be constantly added, but without the last one ever being written. Education for quality can never end in a vigorous and dynamic company, whose products are in effective competition in the current changing market in the world.
Consciousness for Quality
Historically, attitudes to quality among plant personnel have been acquired, either through a quality educational process that includes not only formal quality control courses, but also in part, many informal influences on quality. quality.
Individually, the worker of a plant is the basis that is required for the production of products of satisfactory quality. In most cases, he is the one who wants to do a satisfactory job: however, it is very important to surround him with the appropriate "climate" so that he can do it. You have to turn to your supervisors and bosses to help you in the essential task of quality, to give you a tool with the necessary capacity, the appropriate training to apply and improve your skills and the quality information team to measure your performance and be guided in the operation of the process for which he has responsibility.
Quality awareness in the general manager should be more than a matter of lip service. The most forceful harangues in favor of the quality of the product disappear for the operators when an order is received at the factory for subnormal quality products to be shipped, in order to fulfill the dispatch of an order.
The functional managers of the company rely on applying the policy of the general management and at the same time obtaining a functional job according to the plan. Unfortunately, things don't always go according to plan and conflicts start.
One of the main figures in any quality awareness campaign is the supervisor of a production section. This represents front-line leadership, both in name and in fact, for all the workers under his command. If a good industrial relations program is in place, the supervisor's position as manager is well established, as should the information conduits. Therefore, in a quality awareness campaign, the supervisor is the communication medium of the company. Furthermore, the action of the supervisor in his line, in favor of the quality of the product, must be supported by the middle managers and by the general management in any case. By doing this, the supervisor will feel safe and advocate for the product quality cause.
There are a large number to interest individuals and groups, tending to promote that awareness of quality. These means must be used during certain periods. Even if it is a small promotion, the following resources can be used effectively:
- Short notes in the plant's newspaper Allusive cartoons or drawings in the newspaper Placing posters in the work area Quality phrases Suggest rewards for quality improvement ideas
To promote quality awareness throughout the organization, it is important to have the participation of all staff. If a person does not fully appreciate the value that the production of a quality product represents for him, he must bear in mind its importance for the whole. Therefore, each person must think that well-being includes them. This creates esprit de corps throughout the organization.
Approach to Participation in the Commitment to Quality: Quality Circles, Quality of Work Life (CVT) and other Main Approaches
Among the main approaches to employee group engagement, three aspects in particular will be discussed:
Quality circles
One of the most widespread forms of employee group participation is the quality circle. A quality circle is a group of employees - usually from a section of the plant and company activity - who meet periodically for practical purposes such as: pointing out, examining, analyzing and solving problems, usually of quality, but also of productivity, safety, labor relations, costs, warehouses, etc.; in addition, to enhance communication between employees and administrators.
One of the unique characteristics of the quality circle is the structural emphasis on the organized solution of the pertinent issues and problems of the plant and company. One of the main factors in the activity of the quality circle is the training of the circle participants in these analysis and synthesis techniques.
Quality of Work Life (CVT)
For many years, various different forms of programs have brought employees together with supervisors and administrators so that all can consider improved methods and means of managing improvements in the quality of work life.
One of the broadest and most recently known forms of the program itself has been described as quality of work life and is based on the principle that responsibility towards quality is more natural where workers have intense participation in the decisions that are reflected in their jobs.
CVT activities have taken very varied forms in different companies; workers may be asked to help design their own assembly lines or workstations; production teams can take over the selection and training of new team members without direct supervision from management; they can take on other traditional management responsibilities, such as predicting labor and material requirements, and can even evaluate their own performance.
Other Important Approaches
Achieving quality awareness and responsibility for quality depends on genuine, widespread employee enthusiasm and cooperation throughout the plant and company in planned activities for total quality control.
Participatory approaches to driving quality responsibility at many plants and companies have proven their worth over the years. The key to effectiveness has been choosing that employee engagement program that genuinely meets the needs and conditions of the specific company. The establishment by a company of a particular quality improvement program that evolves from its requirements and history can be especially effective in many cases.
Commitment to Quality: Worldwide Growth of the Quality Field
There has been a literal explosion in recent years on every continent and in many countries of men and women practicing quality control in factories and offices in some quality area. Some are highly professional in their practice; many others are becoming so very quickly. The population explosion of the global quality control community can be summed up in three central points that are vitally important to all men and women in the quality field:
- The first point is that the practice of quality control is no longer concentrated in a few countries and among a relatively small number of men and women Second, innovative developments and advances in quality control are broadly and significantly based on many countries in the world.Third, to practice quality control consistently with the best and most modern methodology, it becomes increasingly important to keep informed of the progress of quality control and activities on a much more internationally oriented basis than ever before.
Faced with the rapid growth of internationalization, the prospects are that this will greatly deepen and broaden the contribution that quality professionals can make for the growth and health of companies' businesses as they face today's increasingly world. small and competitive.
4. THE COSTS IN QUALITY
Fundamentals of the Economics of Quality Systems
During the last decades, companies in the Western world have become aware of the strategic importance that Total Quality Management (ACT) represents for the health of their own companies. They understood that ACT would allow them to be competitive in national and international markets. Thus, a process of continuous quality improvement has been started.
The satisfactory quality of a product or service goes hand in hand with satisfactory costs of quality and services. One of the main obstacles to establishing a more dynamic quality program in previous years was the misguided notion that achieving better quality requires much higher costs.
Unsatisfactory quality means unsatisfactory resource utilization. This includes waste of material, waste of labor, waste of equipment time and consequently implies higher costs.
A major factor in these past misconceptions of cost-effectiveness was the limited availability of important data. In fact, in the early years, there was a widespread belief that quality could not be practically measured in terms of costs. Part of the reason for this belief was traditional cost accounting, which followed the lead of traditional economics and had not tried to quantify quality. Correspondingly, the cost of quality did not fit easily into the old accounting structures.
Today, not only is the measurement capacity recognized in the quality programs themselves, but these costs are central for the administration and engineering of modern Total Quality Control, as well as for the strategic planning of the business of companies and plants.
Why are Quality Costs Important?
First of all because they are big, very big. According to the research of a working group of the Office for National Economic Development (ODEN) that studied the quality and standards published in 1985, about 10 to 20% of the total sales of companies is represented by costs related to quality.
Second, 95% of costs in quality are generally related to valuation and defects. These expenses add very little to the value of the product or service; the expense of defects, at the very least, can be considered avoidable. Reducing the costs of defects by eliminating the causes of non-compliance can also result in a substantial reduction in valuation costs.
Third, unnecessary and avoidable costs make goods and services more expensive. This in turn affects competitiveness and, in the long run, wages and standards of living.
Fourth, it is clear that the costs and economics of many quality-related activities, including investments in prevention and evaluation activities, are unknown to companies, despite the fact that such costs are considerable and that a substantial part of them is avoidable.
What are Functional Quality Costs?
Quality costs in plants and companies are accounted for in a way that includes two main components: control costs and control failure costs. These are the quality functional costs of the producer.
Control costs are measured in two segments: prevention costs, which prevent defects and nonconformities from occurring, and which include quality expenses to prevent unsatisfactory products from emerging in the first place. Included here are such cost areas as quality engineering and quality training for employees. Evaluation costs include the costs of maintaining the company's quality grades through formal product quality evaluations. This includes cost areas such as inspection, testing, external investigations, quality audits, and similar expenses.
Control failure costs, which are caused by materials and products that do not meet quality requirements, are also measured in two segments: internal failure costs, which include the costs of unsatisfactory quality within the company such as scrap., spoilage and reworked material, and external failure costs, which include costs of unsatisfactory quality outside the company, such as product performance failures and customer complaints.
The following figure shows the division of the quality costs previously exposed, with their respective segments.
Definitions of Functional Quality Cost Points.
Prevention Costs
a.- Quality Planning
Quality planning represents the time-related costs that all personnel - whether in the quality function or in other functions - invest in planning the running details of the quality system and translating the requirements of the product design and of consumer quality in specific manufacturing controls on the quality of materials, processes and products through methods, procedures and formal instructions. It also represents costs relative to time spent doing other quality planning work such as reliability study, pre-production quality analysis, and written instructions or work procedures for testing, inspection, and process control.
b.- Process Control
The process control includes the costs originated by the time that the quality control staff spends when studying and analyzing the manufacturing processes, including suppliers, in order to establish means of control and improvement of the capacity of the existing processes, as well as providing technical assistance to manufacturing personnel in the effective application of quality plans and in the initiation and development of control of the manufacturing operating processes.
c.- Design and construction of the quality information team
Costs caused by the time spent in the design and construction of the quality information equipment, security measures and control devices.
d.- Training for the quality and development of the workforce
Quality training represents the costs of establishing and running formal quality training programs in all company operations, designed to train personnel in the training and use of quality control programs and techniques, reliability and security. It does not include the costs of training the operators to achieve a normal sufficiency in the quantity of product.
e.- Verification of the product design
Product design verification represents the cost of evaluating the product prior to production, for the purpose of verifying the quality, reliability and safety aspects of the design.
f.- System development and administration
The development and administration of the system represents the cost of engineering and administration of general quality systems and support for the development of quality systems.
g.- Other prevention costs
Other prevention costs represent administrative costs involving quality and reliability organizational costs that have not been accounted for otherwise, such as office and administrative salaries and travel expenses.
Evaluation Costs
a.- Inspection and testing of purchased materials
Inspection and testing of purchased materials represent costs applicable to the time spent on testing and inspection to evaluate the quality of purchased materials, by operators and supervisors. It also includes the cost of inspectors 'trips to suppliers' plants, in order to evaluate purchased materials.
b.- Laboratory acceptance tests
These acceptance tests represent the cost of all tests carried out by a laboratory or testing unit to evaluate the quality of the purchased materials.
c.- Laboratory measurements or other services
These measurements or other services represent the costs of a measurement laboratory such as instrument calibration and repair and process testing.
d.- Inspection
The inspection represents the costs related to the time spent in the inspection by the respective personnel, evaluating the quality of the product in the workshops, by supervisors and office personnel. It does not include costs caused by tests found in item 2a, test equipment, instruments, tools or materials.
e.- Tests
The tests represent the costs of the test personnel, in the evaluation of the performance of the product in technical tests within the workshop, including expenses of supervisory and office personnel. It does not include the cost of testing the material purchased, according to point 2a, test equipment, instruments, tools or materials.
f.- Checking the use of labor
This check represents the costs due to the confrontation time that the workshop operator consumes in checking his own work, in accordance with the work plan or the process plan to ensure that the product responds to the quality requested in the plans of the workshop. production, as well as the selection in batches that have been rejected for not meeting the required quality requirements and in other activities with reference to evaluating the quality of the product.
g.- Preparation for tests and inspection
Preparation for testing and inspection represents the costs associated with the time spent in preparation by the personnel, related to the test equipment that allows functional testing.
h.- Material and equipment for tests and inspection and equipment for lower quality
This subsection includes the energy costs to test large devices, such as steam, fuels, and materials and supplies used in destructive tests, such as durability tests or inspections of rupture or tear in destructive tests, durability tests or disassemble for inspection. Lower-quality equipment includes the costs of non-capitalized quality information equipment.
i.- Quality audit
The quality audit represents the costs relative to the time that personnel spend on audits.
j.- Contracts with abroad
Foreign contracts refer to commercial laboratory costs, insurance company inspections, etc.
k.- Conservation and calibration of quality information inspection and testing equipment. The maintenance and calibration of the equipment, in terms of costs, includes what the maintenance personnel earn, for the time spent in calibrating and taking care of the test and inspection equipment.
l.- Review of the product by engineering and shipment
Represents costs applicable to the time it takes for production engineers to review data for product testing and inspection, before authorizing delivery to leave the factory.
m.- Field tests
These are the costs incurred for tests in the field of use, by the consumer, before the final delivery of the product. They include travel expenses and accommodation expenses.
Costs for Internal Failures
a.- Waste
In order to obtain the quality costs in the operation, the costs for waste incurred while achieving the required quality values must be considered. Waste due to other causes such as being discontinued due to obsolescence or design modifications, etc. are not included.
b.- Rework
Supplementary jobs represent additional payments to operators while the required quality is achieved. They do not include payments made for recovery of the product in exchange for the design to satisfy the consumer. The recall or repetition may be due to failure in the manufacturing itself or due to vendor failure.
c.- Costs for supplying materials
Additional costs incurred by the personnel in charge of supplying materials when engaging in handling complaints and rejection of purchased materials. In these cases, it will be ensured that the providers are fully aware of the reasons for complaints and rejections.
d.- Consultation between factory engineers
These costs are for the time that the production engineers spend in solving some problems related to the quality of the products; for example, when a product, component, or material is not in accordance with quality specifications, or when a production engineer is assigned the task of studying the feasibility of a specification change. No cost is included for the execution of the work inside the workshops.
Costs for External Faults
a.- Complaints within the guarantee
They represent all costs of specific complaints in the field within the warranty for investigation, repair or replacement.
b.- Complaints out of warranty
They represent all costs accepted for the adjustment of specific complaints in the field, after the expiration of the guarantee.
c.- Product service
Represents all accepted costs for product service directly attributable to correction of blemishes or special tests, or correction of defects not as a result of complaints in the field.
d.- Product withdrawal
Represents quality-related costs as a result of recalls of products or product components.
e.- Legal responsibility of the product
Represents quality costs incurred as a result of lawsuit judgments related to quality failures.
Difficulties Associated with Definitions of Quality Costs
It should be realized that the problems of rigorous definitions arise only as a consequence of conducting a quality costing exercise. Consideration of quality does not require such precise distinctions between what is related to and what is not related to quality. But there are numerous indications that, even when compiling costs, those doing so do not feel compelled to compile only those rigorously defined.
Two basic and important considerations for any quality costing study are: accounting systems do not easily provide the necessary information, according to current definitions, and the fact that rigorous definitions of the elements of the activity classified as quality standards are required only for calculations. Items are defined in such a way that it is difficult to calculate their cost, which is an absurd situation. In general, they are defined from specific activities or expenses that originate from not providing the product or service (in the broadest sense), without taking into account the ease of calculating the cost.
Costs generated by functions other than quality assurance and production and operations give rise to similar classification problems. Some notable examples are the contributions of the procurement function to aid and quality assurance from suppliers, as the goods procured are suitable for that purpose. Other examples are the activities of engineering and design departments, related to concessions and modifications that have an impact on product quality. The quantification and classification of such factors, as well as the calculation of their cost, is something very difficult and rarely done; but they can represent significant proportions of the categories of prevention costs and internal defects.
Various factors serve to ensure the basic usefulness of the product, prevent errors, and protect and maintain the quality of the product and service. Examples include the use of design codes, the preparation of engineering and management systems and procedures, cash surcharges for machine control, documents and drawings, and handling and storage practices. Whether such factors may be the source of costs that can be considered related to quality is something to be determined as the case may be.
Data Collection on Quality Costs
Collecting data on quality costs just to see what it reveals makes very little sense. So the strategy for calculating the costs of quality - and its effect on the measurement and collection of the respective costs - is a fundamental matter.
Much of the data needed to provide a cost of quality report may be available in the existing plant and company accounting system. Quality cost information can be obtained from timesheets, expense accounts, purchase orders, product recall reports, debit or credit memoranda, and many other similar sources. Often, the data obtained from these sources can be put together to provide the different quality cost points and to place them in the segments and categories already discussed. When data is not available for a certain point, for example, the time spent by design engineers to interpret quality requirements, it is often possible to do exact calculations to arrive at a value for the item.
The computer data procedure is an important tool for quality cost reporting in many companies, whether with a centralized computer operation or in a distributed database.
5. CONCLUSIONS
In order to implement the Total Quality Control frameworks in the direction of competitive quality leadership, four basic points are essential:
First, there is no such thing as a permanent quality level. One of the flaws in traditional quality control programs has been that they establish only one correct quality level, and then direct every effort to meet and maintain that level.
Second, is that personal leadership is a cornerstone of good direction to mobilize the knowledge of quality, the necessary skill and positive attitudes of each individual within the organization, to recognize that what is carried out so that the improve quality to make everyone in the organization better.
The third fundamental point is that quality is essential for successful innovation. There are two reasons:
The first is the greatly increased speed of new product development. The television took 20 years to mature as a product; the personal computer, 4 years; many new IC apparatus, no more than 12 months.
The second reason is that, when the designed product is about to be manufactured in several countries and when international suppliers must get involved early, the whole development process must be clearly and visibly structured. For this, the concept of total quality has four stages:
- make quality a full and equal partner in innovation from the beginning of product development emphasize that high-quality product design and process coincide upwardly - not after manufacturing planning has frozen the alternatives already. make all supplier services a quality partner when starting the design; Instead of a quality oversight problem, later. Make speeding up a new product introduction - not slowing it down - a primary measure of the effectiveness of a company's quality program.
The fourth fundamental point is that quality and cost are complementary and not objective business conflicts.
These fundamentals make it clear that quality leadership is today the key to the success of companies' business and that this adds to national economies. Correspondingly, national and regional initiatives are becoming increasingly important in fostering quality leadership.
Taken together, all of this emphasizes the fact that quality has become, at its core, a mode of management, based on:
- A clear understanding of the domestic and international markets and how people shop in these markets A thorough understanding of the kind of total quality strategy that provides the business foundation to satisfy these customers A committed management that has the knowledge to create the environment for a company necessary for quality and rigid goal setting, and the detailed implementation programs necessary for quality leadership
These are the keys to making today's quality the best investment in corporate competitiveness.
Total quality management as a key business variable and strategy is a permanent presence in companies, which need to see and treat it accordingly. Collecting, documenting, and using information on quality-related costs is one of the factors in promoting a continuous quality improvement process. Quality costs need to be formally declared by companies, part of their operational plans and budgeting systems, and for executives to handle them accordingly.
The task of costing quality is not easy. There may be internal opposition to the concept and data is purposely hidden, but people and companies who have persevered and succeeded have found it to be a very valuable exercise.
Businesses should seek help if they need it. The collection and use of quality-related costs can be, and is, helpful. However, it should not be forgotten that it is not enough to have organized the necessary mechanism to collect costs; Senior management also needs to be determined to perform the quality costing exercise and to use the data.
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