Question

The manufacturing manager of Company X had installed a wage incentive program. She happily reported six months later that the system was a success because production was up and unit costs were down. A quality control manager said, however, that the percentage of rejects had increased markedly and that this was creating a backlog of rework requirements. An industrial engineering manager reported that the expenditures for industrial engineering studies in the department were up by 50 percent. An industrial relations manager said that arbitration fees resulting from incentive grievances had tripled. Discuss your observations in this case. What should be done to correct the situation in this production department?

Answer 1

In the given scenario it is clear that the products produce were of inferior quality and hence rejected by the customers.

The above conclusion has been arrived due to the following reasons:

• Percentage of rejection has been increased.
• Arbitration cases have been increased.

It is necessary to produce high quality of products so as to maintain goodwill of the firm. Total quality management technique can be obtained so has to increase the quality of the product can be used as corrective measure.

Total Quality Management is a system of planning and controlling all business functions so that the product produce meets the expectations of customer. This will ensure external failure is reduced to great extent.

The following actions are necessary:

1. The Raw material purchased has to be inspected to ensure its quality is upto the mark, as there is no use of producing the product with inferior raw material resulting in inferior final product.

2. The final products has to be checked for its quality before dispatching it into the market. Any defect in the product should be as scrap.