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[Music] hello and welcome to taking the beers this is a channel dedicated to a level business students just like you if you're just stumbling across the channel for the first time it would be great if you could subscribe in this tutorial we're going to investigate the topic of quality and management now quality is essentially the process of trying to meet or even exceed the requirements of your customers and a possible exam question that we might get posed is about why quality is important to an organization and there's lots of different possible reasons we could discuss in an answer the first issue to address is that quality might be important to ensure that a firm meets the minimum legal requirements relating to selling goods and services to consumers there are lots of consumer legislation acts in the UK that govern the rights of consumers when they're purchasing products from a business so at a very minimum in terms of the quality standards a business strive towards it should be making sure that it sticks within the confines of any consumer laws relating to what they sell might also be important from an ethical point of view as well if a firm is pursuing ethical objectives associated with providing customers with a certain standard of service then producing a quality product is a key part of any ethical objectives that the firm is pursuing another benefits or another reason why firms might be pursuing quality is because it affects the costs of the business as well when a business makes mistakes when it has what are known as defects well it produces quite products that are not of the requisite standard of quality for us to be able to sell then it essentially means that the business has used up resources such as raw materials or the time of employees who have been paid a wage or salary and those resources have been used to create a product that's not fit for purpose that's not of a high enough standard of quality for us to be able to sell and make revenue from so poor quality costs a business money it damages the efficiency of the organization it means that the firm needs to use a greater amount of resources to achieve a given level of output so we can reduce mistakes if we can improve quality if we can reduce the number of defects that an organization produces it will cut costs and it will improve efficiency and link to that quality can affect the prices that a firm is able to charge if a business is making lots of mistakes if it has many defaults if quality is quite poor in the organization then as we use up more resources to achieve our level of output and as our costs arising we're going to have to command a higher selling price in order to be able to cover our costs so we might have to charge higher prices than rivals essentially damaging our competitiveness in order to subsidize the amount of defects that our business is producing so that leads to our next reason why quality is important because it helps a business remain competitive but not just in terms of price competitive but other firms that can achieve higher quality levels than us might have more satisfied customers might be able to delight customers with what they sell whilst we are barely meeting customers minimum requirements that might lead to consumers naturally choosing to purchase our rivals products rather than our own it might damage our sales volume it might damage our market share might mean that we can't experience the economies of scale that rivals are able to benefit from so in order to make sure that a firm remains competitive on price other factors as well quality can be a key components and so that really hints at the final reason why quality is important to an organization and that's because it leads to satisfied customers which can seriously affect the building of a brand name for an organization customers like to make recommendations and they will make recommendations when they are delighted by the quality of an organization and when they are really pleased with the level of service or the quality of good that they have bought but equally customers like to discuss when they've received bad service or have bought a poor quality product as well so quality really affects the word-of-mouth publicity that an organization is able to generate and it could work very positively for an organization of quality is good and it can also work negatively when quality is poor and really damaged the brand that the organization has spent time and resources building up so if we get that question on why quality is crucial to organizations there's many different avenues that we can talk about but there's another question that we need to be prepared for as well and that how best firm should set about trying to ensure that what they produce is good quality and so we've got three different quality concepts that we will have come across during our studies the first two often go hand-in-hand together and that's quality assurance and quality control how quality insurance are measures that the business introduces in order to try and prevent defects from occurring any kind of system that a business devises to try and prevent mistakes and prevent defects is known as a quality assurance measure but mistakes might still happen so firms might also have quality control processes as well those are processes designed not to prevent defects from a but spotting them and routing them out when they have occurred so that faulty or defective goods aren't sent out for consumers only for them to unbox them or unwrap them find that they are damaged or faulty or defective and then have to return them from the retailer that they have bought them from so with quality assurance we're trying to prevent defects from occurring in the first place but when they do we'll have systems in place quality control measures to make sure that we spot any defects and prevent them being sent out to our customers but there's another method known as total quality management TQM which is really a philosophy to quality then an organization may adopt and it really works on the notion that defects don't have to be inevitable we don't have to have quality control measures that spot defects that have occurred we could strive to make sure that a business produces zero defects now the way the total quality management tries to achieve this is to make every employee in the organization involved in the quality process making every single employee accountable for the quality of the work that they produce the notion is that if every employee focuses on the quality of what they've done rather than passing on bad quality work and hoping that somebody else will spot it later on in the production process if every employee is responsible every employee is accountable for the quality of what they've produced then in theory it should be possible to strive towards zero defects in the production process so total quality management essentially creates what are known as internal clients inside the organization where every employee is essentially serving the employees who are later on in the production process they become their internal costs summers almost as if they are selling them the quality of what they have produced and if other employees in the organization are not happy with the quality of work that they receive to continue with they can return it to the people earlier on in the production process who have to rectify their mistakes and can't send it on in the production process until any errors or problems in the work that they've produced have been addressed and corrected and the idea is isn't that trying to strive for this zero defects is a far more efficient way of spotting or controlling quality than just trying to spot mistakes that have occurred and scrap those products and make sure that they don't go out to customers so we can really achieve some huge benefits some efficiency gains some cost management gains by adopting this zero defects approach known as TQM but it relies on employees having the training and the skills to try and minimize any mistakes that they make and them having a culture inside the workplace where employees are encouraged to return work to colleagues that they feel is of insufficient quality so that's the idea behind TQM the alternative the more traditional approach that is still widely used is a mix of quality assurance and quality control techniques but hopefully that will help us with two potential exam questions we might get on quality management hopefully that helps you with your revision you keep on taking the beers you you you