In: Accounting
500 WORDS REQUIREMENT!!
Review activity models of multiple business processes and review the potential risks and opportunities for process improvements.
Leadership is a key strategic variable for quality improvement. A good leader should be able to organize, control, plan, communicate teach, advise and delegate effectively which improves the quality of the system. Leadership influences a group to achieve super ordinate goals which benefit the whole group. Leaders have so many powers including power of expertise, reward power, coercive power, referent power and legitimate power. Power of expertise help the top management to take appropriate decisions on improving quality in case of risks and reward power is utilized to reward the employees on achievements. Coercive power is used to punish the follower if they do not follow the rules and regulations and referent power is the power possessed by leader which makes him charismatic. Legitimate power is used to request subordinates on certain tasks. All these powers of top management are important for quality improvement. Top management review the survey results to understand the customer needs and take appropriate actions on quality related issues. Hence top management leadership is very important for quality improvement.
By using management by dictate model numeric values are set for the coming year and the lower level managers need to meet these numeric goals. The main hazard of this model is that goals are created without providing systems to achieve the goal. This may lead to distortion of data or distortion of system. People misrepresent data for benefit and honest data becomes a question. Some people distort the system for their benefit changing the system operations for an output that meet the goals set by the management which in turn sometimes increases the cost.
Quality management is very hard, painstaking and slow work where victories are very difficult to achieve. Leaders need to show commitment to quality management by providing funds, slack time and resources for quality improvement. This commitment may be measured in decades and the commitment should continue till the success of the efforts put forward for quality improvement like trainings given to employees.
Prevention costs are those costs which is associated with preventing defects and imperfections from occurring. It includes three categories like training, quality planning, process engineering and other costs associated with ensuring quality in advance. The main limitations of quality related costs are there may be some conflicts regarding the relation of the costs with quality and people who work in prevention often do not keep record of all costs.
The importance of prevention cost is that when the expenditure in prevention increase quality conformance also should increase. By spending more on training and developing the employees the benefit also should increase. As conformance to quality improves failure costs will reduce. When these conditions are met an economic quality level is met where quality related costs are minimized.
Internal failure costs are those associated with online failure and external failure costs are those associated with product failure after the production process. External failure costs include those after the customer takes the possession of the product.
In my opinion external failure costs are more important because it affects the customer satisfaction and trust on the company if the product fails once the customer receives the product. It also affects the overall reputation of the company and customers may become reluctant to buy the product.