GMS 401 Chapter Notes - Chapter 7: Pareto Analysis, Radial Tire, Dmaic
Quality and strategy: organizations have found that quality is a wonderful tonic for improving operations. Managing quality helps build successful strategies of differentiation, low cost, and response. Defining customer quality expectations has helped bose corp. successfully differentiate its stereo speakers as among the best in the world. Nucor has learned to produce quality steel at low cost by developing efficient processes that produce consistent quality. And dell computer rapidly responds to customer orders because quality systems, with little rework, have allowed it to achieve rapid throughput in its place. Improvements in quality help firms increase sales and reduce costs, both of which can increase profitability. Increases in sales often occur as firms speed up response, increase or lower selling prices, and improve their reputation for quality products. Similarly, improved quality allows costs to drop as firms increase productivity and lower rework, scrap, and warranty costs.