Which of these statements describes Total Quality Management (TQM)?
A system which looks at the quality of finance in the business
The managers each look after their own department’s work
The system uses quality managers to monitor what the employees produce
Workers are all responsible for the excellence of the business’s output
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Identify two consequences for a business of producing poor quality goods.
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Which of the following describes the total quality management approach (TQM)?
Checking for faults only at the end of production
Preventing mistakes
Recalling faulty products sold
Repairing returned items free of charge
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State two factors that affect customers' perceptions of quality.
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Which of the following describes the reject rate?
The percentage of items returned by unsatisfied customers
The percentage of Incidents of products brought back to be corrected
The percentage of output considered not fit for sale
The number of complaints received
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State one example of a whole business approach to quality assurance.
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Which of the following is a potential drawback of maintaining consistent quality?
Higher inspection costs, such as hiring and training skilled quality inspectors
Lower levels of waste reduces business costs
Close working relationships with suppliers are developed
Recalling, replacing or refunding customers for faulty goods increases business costs
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Explain one way total quality management (TQM) can help a business achieve better quality.
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Thorntons Ltd is a British chocolate making business which is part of a larger company. Thorntons sells its chocolate products in stores. Boxes of handmade chocolates sell for a minimum of £6. Employees are trained to personalise some products, such as adding a name to Easter eggs, to add a touch of luxury.
Two of Thorntons’ ingredients are cocoa and palm oil. A Fairtrade agreement for cocoa guarantees a higher price for Fairtrade farmers above the normal market price at which it can be sold.
The company wants to behave ethically. When its supplier of palm oil cut down too many trees and had a negative impact on the environment, it found a new supplier in South East Asia.
Information from the Thorntons website Thorntons supports human rights. It wants to ensure working conditions are safe and its supply chain pays a living wage to workers in all countries. It has set an objective to double the amount of cocoa it purchases from Fairtrade farmers. |
Explain one benefit of maintaining quality for Thorntons when producing chocolate.
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Fleet Bikes is a United Kingdom (UK) business which manufactures high quality adult road bikes to sell to retailers. Orders from retailers are expected to be delivered within two weeks. There are lots of competitors for adult bikes. To increase its share of the bike market, the business has decided to develop its own range of children’s bikes. A loan will be required to fund a factory extension. The business is aiming to reduce production costs.
The factory uses total quality management (TQM). The production of bikes uses steel and aluminium. The price of these raw materials goes up and down daily. Each month Fleet Bikes estimates the amount of steel and aluminium which it will need in advance for production. These large orders are delivered within a week and take up all the space in its warehouse. Currently, Fleet Bikes receives a 10% discount from its main supplier for large orders. The supplier can deliver smaller amounts within three hours for an extra cost.
Children’s bikes will be sold only on Fleet Bikes’ website. Customers will expect quick delivery and many of the bikes will need to be manufactured and then sent to the customer within 24 hours of receiving the order.
Explain one benefit to Fleet Bikes of using total quality management (TQM) in its factory.
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Skate4U Ltd manufactures and sells skateboards. The skateboards are handmade using high-quality materials. The average selling price of a Skate4U Ltd skateboard is £285. This is a high price compared to other brands that sell mass-produced skateboards.
In recent years, several large rivals have entered the bespoke skateboard market, putting pressure on Skate4U Ltd to reduce its prices. In order to do so, its managers implemented a series of cost-cutting measures, including sourcing cheaper materials, reducing spending on staff training and abandoning its commitment to repair skateboards up to five years after purchase.
Selected quality information for Skate4U Ltd
2022 | 2023 | |
|---|---|---|
Reject rate % | 0.9 | 1.2 |
Returns rate % | 4.8 | 8.8 |
Number of customer complaints | 59 | 212 |
Average customer review | 4.8/5.0 | 4.5/5.0 |
Explain two likely reasons for Skate4U Ltd's worsening quality measures.
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Explain one difficulty a business may face in implementing a quality assurance system.
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Skate4U Ltd manufactures and sells skateboards. The skateboards are handmade using high-quality materials. The average selling price of a Skate4U Ltd skateboard is £285. This is a high price compared to other brands that sell mass-produced skateboards.
In recent years, several large rivals have entered the bespoke skateboard market, putting pressure on Skate4U Ltd to reduce its prices. In order to do so, its managers implemented a series of cost-cutting measures, including sourcing cheaper materials, reducing spending on staff training and abandoning its commitment to repair skateboards up to five years after purchase.
In 2024, Skate4U Ltd manufactured 2,320 bespoke skateboards, 79 of which failed to meet quality standards.
State the formula used to calculate the reject rate and calculate Skate4U's reject rate in 2024.
Round your answer to 1 decimal place.
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Explain one benefit to a business of using mystery shoppers.
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Since opening in 2003, Krispy Kreme has expanded steadily in the UK. There are now 45 stores and coffee shops, with another 35 planned for the next few years. Quality is an important part of Krispy Kreme’s business, as all doughnuts have to be made with quality ingredients according to the original secret recipe from America.
To ensure perfection, every doughnut is made in one of only 13 larger stores. They are then delivered to local outlets. To make sure they are fresh, each doughnut has a shelf life of only one day.
All new employees follow an induction programme. This covers understanding the importance of quality and health & safety procedures. Krispy Kreme aims to keep the top hygiene rating of 5 at all its stores.
Krispy Kreme wants staff to enjoy their work and take pride in their job. Employees focus on:
being passionate about their work, and believing in the quality of their products
demonstrating initiative, creativity and problem-solving skills.
Incentive schemes and a national annual awards ceremony are organised to celebrate successes.
There are formal training sessions as well as support from line managers, peers and trainers. Additionally, Skills Workshops and Talent Workshops offer support for those keen to further their careers. There are many career opportunities and internal promotions are frequent. Krispy Kreme is proud that over 60% of senior positions are filled internally.
A Krispy Kreme app is available to customers in the USA. Other major coffee shop chains in the UK have apps for customers to use that include a store locator, offers, loyalty bonuses and menus. App developers have quoted £30 000–40 000 to create an app.
Analyse the effect that Krispy Kreme's approach to human resource management may have on maintaining the quality of their doughnuts.
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Nadia Aslam is a wealthy entrepreneur. Two years ago, she bought a struggling airline and changed the name to Skyline plc. The airline offers low-price flights from the UK to popular European destinations. There are high levels of competition in this market.
Nadia has found out that Sibiu, a city in Romania, is becoming popular for city breaks, but no UK airlines currently fly there. Nadia is planning to buy an additional plane and start flying there. Fees and taxes at Sibiu International Airport are much higher than at other destinations. Nadia will need to consider how to cover these additional costs.
Nadia is considering two ways to cover the additional costs of operating flights to Sibiu.
Improving the quality of service offered, including introducing business class tickets, gourmet in-flight catering and premium entertainment facilities
Implementing charges for all flight extras, including hold baggage, printed tickets and seat selection
Evaluate which is the better option for Nadia to take. Give reasons for your decision.
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Fleet Bikes is a United Kingdom (UK) business which manufactures high quality adult road bikes to sell to retailers. Orders from retailers are expected to be delivered within two weeks. There are lots of competitors for adult bikes. To increase its share of the bike market, the business has decided to develop its own range of children’s bikes. A loan will be required to fund a factory extension. The business is aiming to reduce production costs.
The factory uses total quality management (TQM). The production of bikes uses steel and aluminium. The price of these raw materials goes up and down daily. Each month Fleet Bikes estimates the amount of steel and aluminium which it will need in advance for production. These large orders are delivered within a week and take up all the space in its warehouse. Currently, Fleet Bikes receives a 10% discount from its main supplier for large orders. The supplier can deliver smaller amounts within three hours for an extra cost.
Children’s bikes will be sold only on Fleet Bikes’ website. Customers will expect quick delivery and many of the bikes will need to be manufactured and then sent to the customer within 24 hours of receiving the order.
Analyse the impact on Fleet Bikes of implementing total quality management (TQM) in its new children's bikes factory.
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