2.3.3 Efficiency and competitiveness using lean production

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    Quality control is the traditional method of checking that products are of an adequate standard. This involves checking during and at the end of the production process.  This is also known as batch testing which takes one product out of each batch and will accept or reject batch based on the quality if this product. The issues with this with this are that it doesn’t not identify the cause of the defect or find every faulty product. It is also expensive as there are high levels of stock wastage.

     

    Quality assurance ensures that quality standards are agreed and met throughout the organisation. Every worker is involved in quality checking throughout through the production process. They work in teams that take responsibility for quality issues. The emphasis is on the prevention of defects rather than only checking for those that have happened. They may implement a zero defects policy which minimises waste and costs.

    Total quality management (TQM) is similar to quality assurance as employees are all involved in quality control and take responsibility for their and their team’s work. There is a closer relationship with customers in order to meet their needs. There is a closer relationship with suppliers to raise quality of inputs. This requires committed leadership. Each stage of production is a ‘customer’ to the next.

    How does lean production lead to competitive advantage?

    • Reduced costs
    • Quality improvement
    • Staff motivation
    • Less (time) waste/defective products
    • Products become more price inelastic

    Issues with lean production

    • Cost to train workers (kaizen)
    • Some employees do not want to have more job responsibility
    • Can’t meet unexpected orders
    • Too much reliance on suppliers (JIT)
    • ‘Hands on’ manager needed to motivate workers

     

     

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