Unit 17 Quality Management in Business

This is a solution of Quality Management in Business Assignment given in HND Business Course

Introduction

The quality of a product or service defines the degree of the customer service and satisfaction after using it. The satisfaction of the needs of the customers leads to the increase in reputation, demand and profit of the organization. So the organisations always try to enhance and redefine their business functions to maintain and continuously increase the quality of the products and services provided by them (Fornell, 1996). The processes that help the quality management in the organisations are quality control and quality assurance in the inspection and control aspects of the quality management systems. These processes help the organisation to ensure the high quality of the products and services. Several other processes that help the organisations to manage quality in their business functions and final products or services are employee consultation, continuous improvement and effective communication.

TASK1

1.1 Definition of quality in terms of business and services provision

Quality in terms of business and services provision can be defined as the suitability and capacity of the product or service to satisfy all the relevant needs of the customers. The concept of quality ensures the adherence of the product or the service with the standards or the mark that defines the reputation of the organisation that provides those (Grönroos, 1984). In other words a product or service is called to be a quality product or service if it has been designed according to the purposes it solves and satisfies the relevant needs of the customers to a significant extent.

There are several standardizing bodies which have established several standards to measure the quality of a product or service. The standards are applicable to a wide range of products and services of various industries. ISO 8402-1986 standard provides a definition to the quality of a product or a service as the availability of its features and characteristics which allows the product or service to be able to satisfy the intended needs and perform efficiently.

Quality can also be defined as the way to ensure positive brand image and customer loyalty. If the product or service provided by an organisation is of high quality, then the customers will be more confident about the organisation and the loyalty of customers along with the reputation of the organisation also increases (Hanks, 1988).

1.2 Role of quality control and quality assurance in inspection and assurance processes

The Rose and Crown tries to deliver its customers with products and services of high quality. The high quality of the products and services provided to the customers allows The Rose and Crown to be positioned as a reputed hotel for the corresponding products or services. This results in increase in the profit of The Rose and Crown. So The Rose and Crown has established quality management systems to ensure the high quality of the product or service it provides to the customers. Two of the major processes in quality management are quality control and quality assurance (Morgan, 2003).

Quality control

This is the process of reviewing all the elements associated with the production process of a product of The Rose and Crown hotel. This process allows the quality to be maintained in the production processes, knowledge and skill of the employees associated with it and other soft elements associated with the production process such as organisational culture, motivation and team dynamics. Quality control also includes the inspection of the quality of the product after the production process.

Quality assurance

This process ensures the avoidance of defects or problems in the products or services provided to the customers. This can be defined as the procedures conducted in The Rose and Crown hotel which ensure that the products and the services are of the required standards and quality as per the policy and reputation of the hotel. Quality control can be differentiated from quality assurance by the fact that quality control puts a lot of focus on the end result of the production process (Berwick, 1989).

The implementation of quality control and quality assurance processes in The Rose and Crown results in the increase in the profit of the hotel. These processes also ensure increase in the customer satisfaction, brand image and brand loyalty.

1.3 & M1 Approaches and appropriate solutions to improve quality management

There are several approaches available to improve the quality management in an organisation. Some of these approaches can be applied to The Rose and Crown hotel described in the case study. Some of the approaches to improve quality management are mentioned below which can also be applied to The Rose and Crown hotel.

Edward Deming’s approach

This approach provides The Rose and Crown hotel with a set of guidelines which ensure successful implementation of total quality management. Some of these guidelines are to stop depending in the inspection process to achieve quality, adopt new philosophy, eliminate gaps between the staffs and organise continuous training and development activities for all the employees.

Philip Crosby’s approach

This approach defines the quality in The Rose and Crown hotel as a set of four principles mentioned below.

  • Quality is the completion of requirements.
  • Quality is ensured by preventing processes that lead to low quality instead of checking for them in the real time.
  • Quality in the hotel should be standardised by the result with no defect.
  • Quality is measured by the extent of gaps in the completion of requirements.
Joseph Juran’s approach

This approach specifies three sections such as quality planning, quality improvement and quality control. Quality planning involves the processes of identifying the customers, their needs, translating the needs, developing and optimising a product that satisfies those needs.

Quality improvement involves activities of planning the product development process and optimising them.

Quality control involves activities of transferring the process to operations.

Kaoru Ishikawa’s approach

This approach expands Edward Deming’s approach to total quality management. This approach suggests six steps to the hotel to ensure total quality management.

  • Determine the goals and targets of the hotel.
  • Determine the methods that can lead to the achievement of those goals.
  • Organise training and education of the employees of the hotel.
  • Implement the results of the trainings and education programs in the business processes of the hotel.
  • Review the effect of those implementations on the business processes.
  • Plan for suitable actions to manage those effects.

1.4 Similarities and differences between the different methods

There are several methodologies used to ensure quality management in an organisation. These methodologies ensure that the quality management system in the organisation is operating smoothly and in an efficient manner. Some of these methodologies are

Edward Deming’s approach vs. Philip Crosby’s approach

Both of these approaches suggested for the elimination of dependency on the inspection process to check the quality. The quality should be maintained from the initial phase instead of checking for the quality in the inspection phase after the production has been started.

The difference in between these two approaches is Edward Deming’s approach suggests the elimination of targets and numerical goals for the workforce, whereas Philip Crosby’s focuses on the completion of these goals as the quality.

Kaoru Ishikawa’s approach vs. Philip Crosby’s approach

Both of these approaches are similar in terms of establishing goals for the hotel and defining the quality as the completion of those goals.

Kaoru Ishikawa’s approach doesn’t talk about the price of not complying with the requirements as the decrease of quality, which is a major focus in Philip Crosby’s approach. Both of these approaches are also different in terms of prevention of processes leading to low quality.

TASK 2

2.1 Customer satisfaction

Customer satisfaction is the measure of compliance of the features of products or services to the needs of the customer. In other words, customer satisfaction is the measure of the extent to which the features of the product or service cover the needs of the customers.

High customer satisfaction ensures the positive post-purchase evaluation of the product by the customer. This in turn strengthens the brand image, increases the number of customers loyal to the organisation and ultimately increases the sales and profits of the organisation.

All the organisations have corresponding customer satisfaction policies to ensure high degree of satisfaction of the needs of the customers by their products and services. The people who are recruited into the organisation are given an instruction sheet in their induction which describes the guidelines to adhere to the customer satisfaction policy (Hanks, 1988).

According to the buyer behaviour, the customer purchases a product or service to satisfy some needs and requirements. After using the product or service, the customer tries to determine the extent to which the needs are satisfied or the relevant problem solved. If the customer is satisfied with the extent to which the product or service has catered to the needs and requirements, then the customer builds a positive feedback for the organisation. This allows the organisation to get some popularity and recognition in the social groups that the customer belongs to. This helps the organisation to be positioned as a brand in the market. Some of the customers who are very satisfied with the quality of the product or service become loyal to the brand and perform repeat purchases. This helps the organisation to achieve its goals and objectives (Chang, 1998).

2.2 Continuous improvement

Continuous improvement can be defined as an organisational culture which consists of the activities in the organisation which aims at the improvement of different aspects of the organisational procedures not just the business function. In other words, continuous improvement means becoming better continuously. This allows the organisations to devise plans and strategies to improve their several aspects continuously. This causes the increase in the performance of the organisation and the quality of the product or service provided by the organisation. This ultimately leads to the increase in the reputation and popularity of the organisation (Grönroos, 1984).

There are several steps in the process of continuous improvement. The first step consists of identification of the areas of improvement in the different processes of the organisation. The second step consists of the planning of the activities that can improve a particular process or aspect of the organisation. The third step consists of the implementation of the plans devised in the last step and the fourth step consists of the review of the performance of the plan implemented to improve the organisation and its effects (Morgan, 2003).

2.3 Type of added value to be gained by using continuous improvement

Continuous improvement allows the organisation to implement several activities aiming at the improvement of their different aspects continuously. As discussed earlier there are four major steps in the entire process of continuous improvement. Some of the procedures of continuous development also cause the organisation to gain new processes aiming towards the improvement of the organisation’s performance (Berwick, 1989).

Consider a continuous improvement activity identifying the opportunity to improve the training and development system for the employees of the organisation. This allows the continuous improvement activity to identify the opportunity of training programs of enhancing a particular skillset of the employees to a new level. After the implementation of the continuous improvement plan, the employees of the organisation gain a whole new level of skill set, which allows the organisation to set up processes related to the new skills of the employees.

Some of the added values of continuous improvement are the increased benefits to the organisation with the same cost of the processes, reduced cost of the processes and the benefits due to reduction in the cost of the processes. Some of other added values are increased customer loyalty, brand image, repeat purchase and overall profit of the organisation.

2.4 & D1 Types of information made available to customers and importance of effective marketing

Some of the examples of the information made available to the customers are the location details of the retailers of the products, the operating times of those retailers, the comparative price list of different geographic locations and the promotional activities and offers associated with the product. All of this information increases the interest in the minds of the customers regarding the product which in turn leads to increase in the sales of the product.

There are several types of information made available to the customers for the activities of quality management and other organisational procedures (Ishikawa, 1982). Some of this information is current researches of the organisation; several corporate social activities conducted by the organisation, past performance of the organisation along with the profits, the range of the products and services provided by the organisation, total financial worth of the organisation and the geographic areas of operations of the organisation. This information allows the customers to put their trust and confidence in the operations of the organisation which in turn leads to the increase in business of the organisation. Effective marketing strategy allows such information to be communicated to the potential buyers and present customers of the organisation in an effective and efficient manner which allows the increase in reputation of the organisation (Badri, 1995). The implementation of effective marketing strategies in an organisation allows the organisation to identify, anticipate and satisfy the needs of the customers in a particular market in a timely manner. An effective marketing strategy allows the organisation to stay responsive to the changes in the market and to maintain a competitive advantage over other organisations in the market.

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TASK 3

3.1 Measuring quality management

Quality management is the organisational procedure responsible for all the activities going on in an organisation to ensure the high quality of the products and the services provided by the organisation. Quality management system in an organisation consists of several separate processes such as quality control, quality assurance and quality inspection processes. The success of the quality management programs can be determined by several factors of the organisation. The ultimate aim of the quality management processes is to increase the satisfaction of the customers. So the customer satisfaction surveys are one of the major ways to determine the success of quality management (Sargeant, 2001). The quality management also causes increase in the sales of the products and services. So the analysis of the sale of the products and the corresponding profits also depicts the success of the quality management processes. The resulting quality of the products and services are the major factors that define the success of the quality management processes. Conducting surveys, interviews, opinion polls and questionnaires both inside and outside the organisation allows the determination of the success of the quality management processes.

3.2 & D1 Benefits of user and non-user surveys in determining customer needs

There are several market research methods available to identify the needs of the customers and potential buyers in the market for a particular product or a range of product. One of the most popular market research methods to collect quantitative data is survey. There are several types of surveys and questionnaires. Generally every type of survey consists of a list of questions targeted at a large number of people. The answers and feedback of the people in the market to the questions in the survey are collected and analysed to accurately understand the market situation and demand of various products in the market (Chang, 1998).

The survey is the process in which a number of customers or potential customers are interviewed or asked a number of questions regarding the features and usability of the products. The benefits of these types of market researches are the huge number of participants in the surveys, the qualitative and quantitative data collected as the answers to the questions and the suggestions to improve the product or service.

The user surveys are conducted aiming at the users of a particular product. This allows the organisations to understand what the customer finds good in the corresponding product, what are the needs satisfied by that product and which feature of the product is the most required according to the user. This survey also helps the organisations to understand what possible advantage one product has over its competing products in the mind of the users.

The non-user surveys allow the organisations to understand the buying behaviour of the non-users. This allows the organisation to determine the changes needed in the product to attract more customers and the needs that are not getting satisfied by the product (Saraph, 1989).

3.3 & M2 Methods of consultation

The management of the organisation having a quality system consults with the employees of the organisation for key business decision making along with the issues associated with the employees. This allows the employees to feel more confident and more involved in the business function of the organisation (Grönroos, 1984). The management may take the final decision, but the opinion of the employees affect the decision making process of the management. There are several methods of consulting with the employees. Conducting surveys inside an organisation is one way of getting the opinion of the employees about key business decisions. One-on-one interviews with the representatives of the employees allow the management to have an in-depth discussion about the issues and business situations. The presence of opinion polls is also another way of gathering opinion of the employees regarding a business decision. Assigning a corresponding creativity manager to all the employees allows the employees to come up with their innovative ideas or solutions of some important business scenario or situation (Fornell, 1996).

3.4 Value of compliant procedures

The complaint procedure is the procedure which is established in an organisation to make sure that the employees will always have a way to report any unethical or unfair event or action getting transpired in the organisation. This procedure is generally mentioned in the documentation provided to the employees while joining the organisation during the induction period.

The employees of the organisation are a very important part of the organisation. There are well sought out complaint and feedback procedures established in the organisations to ensure clear and accurate communication between superior management and the employees of the organisation. The complaint procedure established in the organisations is communicated to the employees at the time of their induction into the organisation. This allows the employees to register a complaint against any superior who didn’t take any satisfactory actions against the issues pointed out by the employee. The complaint against a particular issue reveals the importance of the issue and the benefits of solving that issue. This can be considered as the first step of the continuous improvement of quality. If the issue complained by an employee is grave and genuine enough, then the superior management takes appropriate actions against that corresponding issue. This allows the organisation to manage quality in their workspace causing increase in quality of the products and services. The feedback of the employee on the action taken can be considered as the last step of the continuous improvement process which defines the success of the implementation of the plan to improve or solve a particular issue.

TASK 4

4.1 The organisation’s current ‘state of health’

The ‘Holiday Inn’ London group of hotels is losing profits due to the effects of the global economic crisis. The concept of self-assessment allows an organisation’s management to assess the current status of their business functions in the market. Self-assessment allows managers in various functional division of the organisation to determine the corresponding situation (Badri, 1995). There are four types of self-assessment which are generally used in the organization. These are subjective method, judgemental method, comparison and the last one is benchmarking process. These methods are used to assess the organization by itself.

The subjective method comprises of the finding out the positions of all the operations so that a detailed analysis can provide the required self-assessment. The detailed analysis of the departments will provide their current health as well as their state of operation. This is the subjective method for self-assessment. The second method is the judgemental method which focuses on the judgement provided by the leaders of the organization as well as industry leaders from other companies. The comparison method of self-assessment requires a detailed comparison between the current organization and some other organization based on different predefined metrics. Last but not the least, the benchmarking method will enable the company to create benchmarks for each and every operation which are performed by the company and match the organizations’ standard with the prevailing industry benchmarks.

The results from the process of self-assessment allow the managers of the organisations to modify the processes to be more accurate, effective and efficient. As quality manager of the ‘Holiday Inn’ London group of hotels, I have to assess the current status of the quality of the services provided by the hotels and the success factors of the quality management systems which will reveal the reasons behind the loss of profit and the possible opportunities in the current business processes in the organisation for improvements (Saraph, 1989). As per the assessment with the help of four types, it has been seen that the current state of organization is in good health and it would continue to maintain the same if it keeps up the quality of the services.

4.2 Importance of communication and record keeping

The role of communication in the business functions of the hotels is very important. Effective communication between the employees of the hotel and between the customers and employees of the hotel allows a positive relation to be developed. Communication can be defined as the process of conveying the ideas, information and feelings of one person to another. Effective and efficient communication between the employees of the hotel creates a very good working environment where all the employees can feel confident, secure and motivated. Effective communication allows the management of the hotel to accurately convey their feelings to the employees of the hotel. The employees of the hotel have to communicate with the customers in order to listen and solve their issues. Effective communication of the employees allows the customers to be properly satisfied with the services provided by the hotel. This in turn allows the increase in the popularity, reputation and demand of the hotel (Ishikawa, 1982).

Record keeping is the process of documenting all the events of the hotel including the transaction, customer check-ins and check-outs and inventory management. This allows the organisation to use that information in several types of research to identify market opportunities for a new service or product, profit, gross income and needs of the customers.

4.3 Guidelines for staff consultation

Organisations include the opinions of their employees in the key processes of the business functions and scenarios. This allows the employees to feel more confident, secure and involved in the business functions of the organisation. This also educates the employee about the various activities done by the organisation in order to achieve its goals and objectives. As discussed earlier, there are several methods of employee consultation such as surveys, questionnaires, interviews and group discussions (Morgan, 2003). The organisations have established some guidelines for the process of staff consultation. The guidelines ensure the creation of a consultation plan before starting consulting with the employees. The consultation plan should include several key factors and information such as the purpose of the consultation, timeline of the consultation, target of the consultation, methods to analyse the data and information collected in the process and the tools and methods to use the collected data and information in the decision making process. Having an effective consultation plan allows the quality of the processes to be controlled in the organisation.

4.4 Improving service quality

There are several areas of improvement in the services provided by the ‘Holiday Inn’ London group of hotels. The first thing to be changed in the hotels is the communication procedures and guidelines. The communication between the employees and customers should be enhanced to ensure high satisfaction of the customers (Anderson, 1994). The quality management system of the hotels should be modified starting from the design to ensure the high quality of services and products provided by the hotels. There should be some cost cutting techniques used in several processes which don’t affect the quality of the services provided by the hotels (Fornell, 1996). The cost cutting techniques give the hotels a fighting chance against the global economic crisis.

Conclusion

Effective quality management techniques are required in the organisations to ensure the high quality of the products and services provided by the organisations. The quality management systems in the organisations include processes like quality control and quality assurance to avoid any defect in the final product getting delivered to the customers. There are several factors that define the success of the quality management processes in the organisation. Customer satisfaction is the most important factor that defines the success of the quality management processes. Increased customer satisfaction allows the organisation to sustain, grow and expand in the market with increased profits. Some of the other processes in the organisation that helps the quality management are consultation with the employees about the key business decisions of the organisation, processes for the continuous improvement of the business functions and effective communication in the workplace.

References

Anderson, E. W., Fornell, C., & Lehmann, D. R. 1994. Customer satisfaction, market share, and profitability: findings from Sweden. The Journal of Marketing, 53-66. Badri, M. A., Davis, D., & Davis, D. 1995. A study of measuring the critical factors of quality management. International Journal of Quality & Reliability Management, 12(2), 36-53. Berwick, D. M. 1989. Continuous improvement as an ideal in health care. The New England Journal of Medicine, 320(1), 53. Chang, T. Z., & Chen, S. J. 1998. Market orientation, service quality and business profitability: a conceptual model and empirical evidence. Journal of Services Marketing, 12(4), 246-264. Fornell, C., Johnson, M. D., Anderson, E. W., Cha, J., & Bryant, B. E. 1996. The American customer satisfaction index: Nature, purpose, and findings. Journal of marketing, 60(4). Grönroos, C. 1984. A service quality model and its marketing implications. European Journal of marketing, 18(4), 36-44. BTECHND Assignment Experts

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