SUPPLY CHAIN MANAGEMENT AND QUALITY COSTS 2
Running Head: SUPPLY CHAIN MANAGEMENT AND QUALITY COSTS 1
Business Operations and Supply Chain Management
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Institutional Affiliation
Date Submitted
Business Operations and Supply Chain Management
Problem 1
Costs must be incurred for efficient and effective supply chain process in ensuring young adults get their driver’s license after passing the quality test in driving. Customers in this case being the drivers have to incur quality costs when seeking certification of becoming first-time holders of driver’s license or renewal of licenses at the age of 70. State and federal organizations have the mandate of offering the tests and maintaining quality for drivers. Insurance companies, drivers and police are part of the supply chain that ensures quality control in driving. Quality costs are defined as costs incurred in order to make an improvement in service delivery. For the system to work, all the involved stakeholders have to work together because drivers failures leads to increased internal costs while the government failure in regulating traffic tests and laws often lead to external costs.
The system maintains quality control by constantly revising and updating the driving tests criteria in accordance to the needs and demands of driving safety and regulation. The primary objective of driving tests is ensuring that only qualified drivers are allowed to drive. Majority quality drivers translate to a few accidents caused by their mistakes. Prevention and appraisal costs are incurred when the government through its state or federal organizations makes random inspection to kick out unqualified drivers (Jacobs, Chase & Lummus, 2014). Cancellation of an individual driver’s license falls under prevention and appraisal costs. All the same, redesigning the system would not yield much change; instead it would bring more confusion which might compromise quality. Confusion and conflicts of interest issues will arise due to the fact that, people resist change and the majority are used to the system. Redesigning the system will also involve lots of costs.
Problem 2
Foods taken in raw form in restaurants have a short supply chain. Consumers are always looking for farm to table raw foods and for a good food joint to run and operate in competitive markets, quality costs must be incurred. The owner or the manager in charge of the restaurants have to be keen on quality by making strict and close assessment of the products delivered before accepting them to be served to consumers. Because, the products are served raw, the restaurants manager has little options in controlling quality. This means that, farm produce supplier have to deliver the best quality.
Prevention and appraisal costs in this context become applicable when the manager gets busy in inspecting the farm produce before accepting it to serve to customers. Some restaurants owners go an extra mile in visiting farmers to check if the crops are grown under the right conditions in order to promote and preserve quality (Flynn* & Flynn, 2005). This essential because, as a restaurant owner serving raw foods like salads, it is easier to void incurring internal failure costs if the manager can trace the produce back to farm production. If the salads served at the restaurants do not meet consumer expectations, the customer’s satisfaction will be compromised which will ultimately lead to external failure costs. In this case, the restaurant manager must greatly focus on prevention and appraisal quality costs. Internal failure costs are triggered by delivery of sub-standard goods. Because the products are served raw, it automatically means that, the restaurant will incur external failure costs by serving low quality produce.
References
Flynn*, B. B., & Flynn, E. J. (2005). Synergies between supply chain management and quality management: emerging implications. International Journal of Production Research, 43(16), 3421-3436.
Jacobs, F. R., Chase, R. B., & Lummus, R. R. (2014). Operations and supply chain management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
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