BUSINESS OPERATIONS AND SUPPLY CHAIN MANAGEMENT 2
Running Head: BUSINESS OPERATIONS AND SUPPLY CHAIN MANAGEMENT 1
Business Operations and Supply Chain Management
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Business Operations and Supply Chain Management
Problem 1
The quality costs of driving are not easy to quantify simply because sometimes accidents happens without the driver being involved in anything wrong. Therefore, it not entirely true that, incurring high quality costs will lead to better driving. However, costs must be incurred because there are institutions that are mandated to ensure that new drivers obtain their driving license after passing a quality test. 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 with the mandate of offering the tests and regulation of drivers discipline are the other players who are part of the supply chain and they are the service providers. Insurance companies, drivers and police are also 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 due to the fact that, a driver’s failures may lead to increased internal costs, while the government’s failures in regulating traffic tests and laws can 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 ensuring that, only qualified drivers are allowed to drive. The majority quality drivers, and who translate to high quality driver; this means that only a few accidents are caused by driver 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 and which would compromise quality.
Problem 2
The type of food which is taken in raw form in restaurants has 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 owners or managers in charge of these restaurants have to be keen on quality; by making strict and close assessment of the products delivered before accepting them to be served to their clients. This is because, the products are served raw, and they have minimal options when it comes to controlling the quality. This means that, the farm produce supplier has to deliver the best quality.
Prevention and appraisal cost in this context becomes applicable when the manager gets busy in inspecting the produce before accepting it to serve to the customers. Even some restaurants owners and managers go an extra mile, by visiting farmers to check if the crops are grown under the right conditions, and ensuring that quality is preserved (Flynn & Flynn, 2005). This is essential because; when the restaurant is serving raw foods like salads, it becomes easy to avoid incurring internal failure costs, if the firm produce can be monitored back from where it is produced. If these products; served at the restaurants, do not meet consumer expectations, then the client satisfaction can be compromised and 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 the delivery of sub-standard goods. Because the products are served raw, it automatically means that, the restaurant can 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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