The Importance of Quality (Cambridge (CIE) IGCSE Business): Revision Note

The nature and importance of quality

• Quality considers the characteristics and features of a product that satisfy the needs of customers

  • Businesses need to maintain a level of quality for several reasons

    • Attract and retain loyal customers

    • Build the reputation of the business or brand

    • Reduce wastage and returns from unsatisfied customers

• The quality of a business's products can provide a  competitive advantage  

  • High quality and minimal defects lowers business costs, allowing lower selling prices to better compete with rivals

  • High quality can be used in promotional activity and provide a unique selling point for businesses in competitive markets

  • Successfully developing a USP for quality can improve business reputation and ease expansion into new markets 

• If quality is not maintained then businesses may be at risk of

  • Losing their competitive advantage and customers to other brands that offer better quality goods/services

  • Experiencing higher costs due to having to replace faulty or defected goods

  • Gaining a poor reputation as customers spread poor reviews about the business to others

• Customer perceptions of quality are influenced by numerous factors

Factors that influence quality perception

• Customers may consider products or services to be of good quality if they

  • Look good and are sold by a reputable business or brand

  • Are reliable and durable

  • Are safe and fit for purpose

  • Receive good customer service, including after-sales service

• In some countries laws protect consumers so businesses need to ensure that the products they sell are free of faults or defects to avoid harming customers or their reputation

Quality control

• Quality control involves checking quality at the end of the production process using quality inspectors to find faults

• It is not possible to achieve perfection in every production process

  • EFor example, there will always be some variation in terms of materials used, production skills applied and reliability of the finished product

Evaluating the use of quality control

Quality assurance

• Quality assurance involves employees checking quality standards throughout the production process

  • It aims to achieve quality by organising every process to get the product 'right first time' and prevent mistakes happening

    • There is an emphasis on 'self-checking' rather than checking by inspectors at the end of the process

• Total quality management (TQM) is a specific approach to quality assurance that aims to develop a quality culture throughout the firm

  • TQM is the continuous improvement of products and processes by focusing on quality at every stage of production

  • It tries to get it right first time and achieve zero defects

Evaluating the use of quality assurance

Recommending an appropriate approach to quality management

• The approach to quality management chosen depends on several factors

1. Type of product or service

• Products that affect health or safety, such as food or medicine, usually require quality assurance to prevent serious mistakes

• For simpler products with low risk, quality control may be enough

2. Customer expectations

• If customers expect high and consistent quality, such as luxury goods or food, the business is more likely to use quality assurance

• For less sensitive markets, quality control may be acceptable

3. Cost and resources available

• Quality assurance often needs training, time and more staff, which can be expensive

• Quality control is cheaper and faster to set up but may result in more waste

4. Staff skills and involvement

• If workers are well-trained and motivated, quality assurance is easier to apply

• In businesses with low-skilled or temporary workers, quality control might be more practical

5. Industry regulations

• Some industries are required by law to meet high quality standards

  • Examples include healthcare, food and aerospace

• These businesses may have no choice but to adopt quality assurance systems