Essay: Discuss definitions of quality in terms of business and services provision

The business and service company gain huge profit by selling their products and services. How do they maintain the huge profit and also their competitiveness in the market? As a modern management, most of the companies have been practicing the quality management to keep the quality of the products and services. The best quality is treated as the key concept to improve sales as well as marketing tool, and also the key element of competition in the market. The quality must be including in all steps of production process of product or service. As big business system as banks, they provide not only daily bank service such as deposit, but also investment items and credit card service for customers. Even if they see themselves are in the finance industry, and not in the service industry, they still need to maintain the quality of their investment products and service, so that they retain the customers and become more competitive. What is quality in terms of business and services provision?
The meanings of quality in term of business have been developed over time. Various interpretations quoted are given below:
According to American Society for Quality: “A subjective term for which each person has his or her own definition. In technical usage, quality can have two meanings: the characteristics of a product or service that bear on its ability to satisfy stated or implied needs; And a product or service free of deficiencies.”
According to Peter Drucker: “Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for.”
According to ISO 9000: “Degree to which a set of inherent characteristics fulfills requirements.” The standard defines requirement as need or expectation.
According to Joseph M. Juran: “Fitness for use.” Fitness is defined by the customer.
According to Six Sigma rule : “Number of defects per million opportunities”.
Generally, the quality of a product or service in term of business and services provision refers to the perception of the degree to which the product or service meets the customer’s expectations. Quality is a perceptual, conditional and somewhat subjective attribute. There is no specific meaning of quality unless it is related to a specific function and/or object.
If the company is manufacturing products, the product must be capable to fit for use to the customers, confirm the manufacture’s requirements and also meet its intended purpose as planned by the business company. As same as if the company is service provided one, the service must be fit to the requirements of the customers, it must meet the intended purpose of a particular service of the company and confirm its requirements. Such as banks, they should maintain a good and reasonable bank service to customers, a comfortable and tidy environment, reasonable lining up time, good manners of the bank staff, clear and proper knowledges of the bank services and products etc., are also related to the quality service to banks.
In recent years, quality also reflects in the after-sales service, including warranty and reaction of complaints. The companies need to react positively and fast to the customers’ complaints, and also provide a suitable term of warranty, in order to maintain the quality even after sales. It may help to obtain and retain the loyalty of customers, which benefits the total sales amount eventually in a long term.
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1.2 Illustrate the processes of inspection and assurance
In inspection and assurance of quality, different processes are used and some are given below:
Quality Planning
It is the initial process which determines how to satisfy the particular quality standards by identifying the quality standards along with the products and services which produce in the company. It identifies the policies, standards, product descriptions and so on. After that, verify the present quality levels and to discover the gap between the identified quality standards and present situation, through using benchmarking, cost benefit analysis, flowcharts and design experiment methods. In the final stage, it establishes quality management plan, checklists and input to other processes.
Quality Assurance
Quality Assurance is the nuts and bolts of successfully running any business. It is the process where regularly overall production performance is evaluated and it also assures the production’s agreement in terms of quality standards. Even the most effective and efficient financial manager in the industry will not live up to their true potential if the quality of their product and services is not seen as a critical foundation of success. For evaluating overall production performance quality planning tools, techniques and quality audits are used.
Quality Control
In this process, three steps are usually carried out. First step, products and services are monitored to determine if they conform to related quality standards and to remove the poor performance of the production method, identifying is the way. After monitoring, quality control methods such as inspections, pareto diagrams, control charts, flowcharting, statistical sampling, and trend analysis are used for identifying poor performance of the production process. After identification of the problem, improvements are done by changing plan, ding rework etc. as quality progress decisions of quality control scheme.
Total Quality Management
Quality improvement programmes are implemented within the company for the purpose of maintaining the specific quality standards in this process. Quality programmes like planning, training, field testing, auditing etc. are maintained in all stages of production process among the staff who are working in the company.
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1.3 Discuss a range of approaches to quality management
According to Deming (1986), quality is anything the customers expect. He encourages managers to plan for the future and anticipate problems to reduce and even get rid of waste. Quality must be designed and planned to do this. Engaging workers in decision-making process is advised to companies, where he believes that the companies and the public share ‘a partnership in quality’. In this partnership, steps must be taken within the company, especially in efforts to improve quality total support and promise from top leadership to ensure cooperation. Some theories given by Deming which provide essential guidance and directions to managers, focus on producing high quality products and services that the customers desire, and also help the managers to achieve success through focus, like Deming’s ‘System of Profound Knowledge’ including the Deming’s cycle ‘Plan ‘ Do ‘ Check ‘ Act (PDCA)’ and Deming’s ’14-Points’.
Besides Deming, around the practices of quality control, quality planning, and quality improvement, Juran (1988, 1989) makes his quality principles. He states that customers must be the focus of quality planning, which is similar to Deming. Involving top management, project by project planning quality improvement and creating a training program for all employees are the main point of his strategies. He also believes in continuous process development management in producing quality products and services, and emphasizes on the customer-focused companies, like Deming. Quality is defined as ‘fitness for use, as opposed to merely meeting specifications’. Quality standards must be set up by managers. Managers need to provide measurements to asses cost and effectiveness of the quality improvement programme. Juran believes that his principles offer practical ideas for companies to attain managerial performance, strategic goals and quality leadership. He predicts companies ultimately achieving a new business culture in which quality improvement becomes one of important elements of every manager’s strategy.
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1.4 Explain the similarities and differences between the different methods
Among different methods, there are similarities and differences.
Similarities
All these quality schemes are based on particular quality standards of the product or service. For example, quality control and quality planning schemes take corrective actions to minimize the poor performance of the production process, while quality assurance and quality control evaluates the current quality levels of the company and come up to a decision. Quality is continuously changed in total quality management and quality control.
Differences
Only previously planned quality levels are considered on the quality planning schema. Quality assurance schema consider only about the level of quality assurance. Continuous improvement of performance of quality practice is the main target of quality control schema. Total quality management implementing quality programmes, if usable or non usable as stage of the production process.
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2.1 Discuss what is meant by customer satisfaction
The customers are the most important people to the business and service companies. These companies fulfill the requirements of the customers in the way of producing and providing quality commodities and services. The company’s existence depends on the customers’ satisfaction. The products and services must be able to meet the customer’s expectations. The product and the service must be valued as its price paid by the customer. The customers are always attracted to the best quality products and services.
Customers’ satisfaction is defined as the extent to which customers are happy and satisfied with the products and services provided by a business. An industry which is based on any goods or service, their customers have a fair idea of what they should receive from spending their money. Usually through marketing, the idea which the advertised promises of the providers is formed. If customers buy goods and services that make them feel special, then they are most likely to appreciate the goods and services. Customers’ satisfaction occurs when customers feel that products and service they buy are specially made for them or people like them. Levels of customer satisfaction can be measured by survey techniques and questionnaires.
If they want to buy the same product or service again after consuming, that means the customers are satisfied and the product or service represents the best quality. This may increase the customers’ confidence to buy other new arrivals. Due to the concern of best quality, some trade marks are more popular. These products and services satisfy the customers in higher level.
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2.2 Explain the meaning of continuous improvement
An ongoing effort to improve products, services, or processes is known as continuous improvement.
“Incremental” improvement over time or “breakthrough” improvement all at once can be sought by these efforts. In the light of their efficiency, effectiveness and flexibility delivery (customer valued) processes are constantly evaluated and improved. In a view of a pioneer of the field W. Edwards Deming, it is a part of the ‘system’ whereby feedback from the process and customer were evaluated against companyal goals. Continuous improvement is also known as Kaizen {the translation of kai (‘change’) zen (‘good’) is ‘improvement’}.
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2.3 Illustrate the type of values to be gained
There are different types of added values which need to be gained for a company. They are given below:
Quality Added Value
Generally it adds convenience, ease of use or other desirable characteristics that are valued by customers. Enriching food with vitamins and minerals is an example of quality added value.
Environmental Added Value
Here the protection of environment is emphasized. For this reason, those methods or systems are employed which do not harm the environment or less harmful than those commonly used. For example: emitting less toxic wastes, using less fuel, using recyclable materials for packaging etc.
Cause-related added value
It is a social marketing strategy. Businesses donate some of their revenue to a cause. For example: A business may contribute to an educational facility for poor children by donating a percentage of revenue from each transaction.
Cultural added value
It is another kind of social marketing strategy. Such methods of systems for production are used which involve cultural aspects or meet the needs and sensitiveness of cultural groups.
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2.4 Describe the types of information made available to customers and the importance given to effective marketing
When a customer decides to start to use a product or service, he wants to understand it as much as possible. Companies need to provide as much as necessary information to the customers for this reason. Generally, customers have keen interest about vision, mission and support of a company when they start to use that company’s products or service. Customers may get a general view of a company from these information provided by the company. The company needs to allow users to access to the detail information about each product, and also should present features of each product which may attract customers to use them. This may keep existing customers interested in new styles, attract new customers to use a similar products with different prices and styles, and may be able to make a trend in the market through marketing. This will contribute effectively to the marketing strategy of the company and increase the market share. If any precaution is needed when using a product, then the company must provide that information to the customers.
A company may set up a communication channel and let their users to report about the weakness of their product, which will help the company to make proper decision about their product and get improvement. The more information customers know about a product, the more they will pay attention for it. This strategy may be known as the purchasing psychology of customers. Can be able to, taking feedback from customers and improve the quality and new arrivals to the market.
If any change is done in any product, the company must provide this information about the changes to their customers. This may satisfy the customers, because the company shows that they respect and care about their users. When customers use a product for a long term, they want to see how this product will be improved by the company. If quality increases, then sales will also increase.
Information is available through internet, television and other media. They are highly use internet to send information to the customers. That is because they can take the customers’ feed back through internet faster than the other mediums. Information availability improves higher buyer in, improves market presents through accessing internet easily. Feed back is significant so that can improve customers’ satisfaction, faster transaction times, more efficient order processing and due to less manual work the fewer errors.
3.1 Explain how quality management can be measured
Quality management can be measured in different ways. It is not difficult to find out that the products or services are not in a best quality by some measurements. For examples:
– The company can count the number of worn goods;
– For produce, goods reworks are done;
– For specific production needs, additional materials or inventory which are generally not be used;
– For sold goods and done service, because they need warranty repairs;
– For sold goods and done services, customers complain;
– For goods and services, liability judgement need to be made;
– Recalls and corrective actions need to be taken for products and etc.
By assessing the customer’s feedback and their requirements, a company may judge their quality management that whether they meet the customer’s requirements or not. Another good way of judging own quality management is benchmarking. In this process, one company compares their own quality management with those who are the best in this field. A company may measure their quality management system with the help of the ISO 9000 family of standards. Because they are designed to help companies ensure that they meet the needs of customers and other stakeholders.
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3.2 Evaluate the benefit of user and non-user surveys in determining customer needs
It is important for all companies to understand the customer needs firstly. Many procedures are conducted to understand the customer needs, but survey is the most popular procedure among them. It is important for a business to consider what kind of survey they should use; and who they should choose for it – users or non-users?
Users are the existing customers. New products or service need to be introduced to them in order to keep their satisfaction. Needs, expectations, the trend in the market and even limitations can be identified by using this survey.
Non users are who they are now not but potentially will be customers. They are non users may be due to unaffordable prices or dissatisfied to the products or service. From the non user surveys, the reason why they do not use the products or service will be identified and products for their desire can be also produced while keeping the standards of the company.
Most of the time, a business company uses user base survey. This survey helps to find their actual strengths and weaknesses. By asking relevant and proper questions, a business company may get proper feedback from their users about the demand and needs of their products or service. They also find the satisfaction level of the users about their product or service by this survey. Non-users survey is also very useful for a company although it can be unusual in marketing research. The company comes to know why these people do not use their products or services, besides that, they come to know what they want from the company, what measures will be taken to satisfy them, what are the certain criteria, and where their competitors are better than the company, etc. Although using both type of surveys needs much administrative efforts and time, both are really important to determine customer’s needs. User survey helps a company to find out whether they are doing good or not in business. In the other hand, non-user survey helps to find out what they can not meet customers’ needs. If a company gets proper responses from user and non-user, it will help them to determine customers’ needs conveniently.
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3.3 List the methods of consultation employed in one quality scheme to encourage participation by under-represented groups
Several methods can be used for encouraging participation of under-represented groups. Some of them are given below:
Form surveys: A form should be designed to get quick reply from under-represented groups as well as should be help to identify the nature of the replies. Under-represented groups should be encouraged to participate in this survey. Their expectations, requirements and problems can be revealed by analyzing these forms.
Telephone surveys: expectations, requirements and problems of under-represented groups can be measured by telephone survey and it is an effective tool.
Interviews: A person may be selected from the under-represented groups randomly for interview.
Group interviews: Another effective way of consultation with under-represented groups is group interviews or group discussions which help to analyse the situation.
Mail surveys: Some people may be selected from the under-represented groups and to get their response pre-paid envelops can be sent with a set of questions requiring short answers.
Electronic surveys: This method is like to the mail surveys, here e-mail is used to sent the questionnaires.
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3.4 Identify the value of complaints procedures and analyse how they may be used to improve quality
Complaints are always treated as negative reactions from customers. But a company which applies quality management and concerns about quality service treats complaints as an opportunity to identify the faults of their products or service and improve them. Most of the companies set up customer service department to handle complaints and advice from customers, in order to satisfy them. The data collected during the complaints procedures can be used for planning and employing quality management practices. Other than complaints about products or service themselves, sometimes customers may complain against staff who sell products or provide service to them. Then the company may improve employees’ quality by proper training. There must be certain complaint procedures.
The customers identify weakness points of the products or service before they buy them or after using them, which include size requirements, colour requirements and etc. The weakness points of products or service may directly affect the sales revenue, because customers may give up to buy them when they find the products or service can not meet their requirements. And even if they buy them, they will soon find the weakness points of the items they buy, that may affect their confidence on the company’s products or service unless their complaints are well handled. In bank service, the weakness points can be high service charge, low interest, lack of or inconvenient branches and so on. This may help banks to review their financial products and distribution or numbers of branches.
Quality may be about the products or service, and also can be the staff who provide service. Once customers find them low quality, it is hard to retain the customers’ loyalty and confidence on the company. For examples, a customer sets up an investment account in banks and wishes to deal with the investment through online banking, but the system always delays and is difficult to use. Soon the customer will feel discourage to use the system, and choose another one which can provide a better and fluent online banking system in order to deal with their investment easily. Complaints on online banking should be recorded and supported by IT department, this may help to maintain a convenient way to handle transaction and investment for customers. A sound online banking system is one of the points for customers to rely on.
Besides that, low quality of staff may also cause customers’ dissatisfaction. Staff should be well trained to be polite and understand their products and service well. Especially the tellers and staff who are face-to-face with customers everyday.
Complaints procedures should be simple, and every complaints should be followed up well, as quality means meeting the requirements and satisfaction of customers. Face the weakness and dissatisfaction identified by customers is the most direct way to improve the quality. A satisfied complaints procedures and system may help to identify problems and dissatisfaction of customers, finally may lead to a reduction of complaints and achieve a quality service.’
4.1 Report on the role of self assessment in order to determine a company’s current ‘state of health’
Self assessment plays a vital role in the success of a company. It is also important for a company to understand its ‘state of health’ and find out whether its business operate well. Different activities should be employed to reach its objectives, and assessment report should be made to find out its activities are performing well. Systems need to be designed and decided according to the best knowledge and experience of members. A company cannot be confident unless they verify their processes are effective. Assessment need to be done to determine the extent of the achievement against the objectives. Benchmarking may be used to find out the company’s own strength, weakness and needed improvement through comparing with others. Internal assessment may be done by providing questionnaires including different categories to staff. This assessment should be done quarterly to keep the improvement in the track.
The quality policy must be developed as the first step by the management team. The quality improvement team must establish to represent all the departments of the company. Quality must be measured continuously to reduce quality awareness errors. The corrective actions must be taken for quality issues and zero defects planning must be done to the future productions.
The identified errors can be removal through daily quality checking and reduces the error making purposes. After that, critically recognise the particular point will help to improve the quality. Employees must be educated about the quality standards, issues and the importance of quality work. Quality council must work on daily basis and plan a zero defects day.
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4.2 Evaluate the importance of communication and record keeping
Communication is very important for a company, as it is an integral part of quality management system. A company needs to communicate within it and outside of it in order to achieve a quality management. For the internal part, proper communication helps all members of a company avoid apathy, and also provides new ideas to develop quality practices. For the external part, the foundation of quality management system relies on the communication with the customer. A company gets the information about their products’ satisfaction level to the customer by communicating with them effectively. To determine the quality of the product and the service this is the key factor. As in banks, both internal communication among the staff and administrators, and external communication between the staff and the customers, are rather important as banks do provide service. Bank service requires good communication, as poor communication will cause loss of money to customers which all users of bank service care the most.
Record keeping is another important task to all companies, as proper functioning of a company depends on it. Record keeping makes easy, the benchmarking processes with other companies. Information are recorded during both internal and external communication, so that helps in formulating and implementing plans for quality control. Companies compare the past results by record keeping. It is used to find out major defects within the production process of goods and services, also helps to improve the quality of product or service and the particular stages of the process. For bank service, it is an indispensable process, and surely banks have their huge data bases saving all the transaction record. As customers will concern the flow of their assets and investment. Once they have questions and argument, the record may help to explain and solve the problems. And one of the record keeping examples for banks, is the call record of hotline. Lots of customers call to deal with their investment and transaction, call record keeping may help to ensure the benefits of both customers and bank staff.
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4.3 Follow guidelines on the stages of staff consultation necessary for effective implementation of a quality scheme
Staff are responsible for the production, since the quality of the product or service is depending on the quality work done by the staff. From the planning stage to after sales services stage, the staff must do the quality work. The surveys can be done through the staff about quality scheme of the company. The documents are also filled according to the quality standards. The workforce planning also should be changed for effective implementation of quality scheme. The time management and material management must be qualified for the effective implementation. Training for the new staff according to their particular positions should be provided, so that the errors will be reduced and the quality scheme will be improved.
For growth and development of all type of companies, people related need to exchange views and ideas by talking with each other, exchange commands and discuss plans. For any company’s success, communication and consultation with staffs can be considered as the lifeline. It is also vital for implementing any tactical plan together with quality schemes. The communication and consultation should be encouraged at all levels for appropriate functioning of quality management systems. Top management should not hesitate to consult and communicate with a ground level staff, as ground level staff are the people who will convert top management’s vision into reality. Top management must always convince them that they are not ordered, they are part of the company. Normal staff may feel apathy if the top management neglect them, this may greatly affect the quality.