What Is Quality Management and Why Does It Matter?

By Indeed Editorial Team

Published 27 April 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Quality management is an important element for the success of any business. Every employee has a role to play in effective quality management. Understanding what the management of quality is and how to achieve it can help you contribute to the business' success. In this article, we give a quality management definition, explain why it matters and note the components and principles of effective management of quality.

What is quality management?

Quality management is the act of overseeing all tasks to ensure employees complete them to the company's standards. Businesses can apply strategies for managing quality to its projects and business operations. The quality management system provides guidelines for how to perform tasks and what the end result is. All processes can follow quality management guidelines, including recruitment and hiring, delivering customer service and managing risks. Consistent management of quality helps a business to achieve and maintain a desired standard.

Why is managing quality important?

Here are the key reasons why the management of quality matters for businesses:

It ensures high-quality products and services

When businesses verify the quality of their products and services before they reach consumers, they can feel confident they meet the business's high standards. Any products and services that fall below company standards can get discarded or improved before sale. Customers receive products and services of a consistently high standard regardless of their location, the employees that serve them and if they shop in-store or online.

It supports customer satisfaction and retention

Customers value businesses that offer quality products and deliver good customer service. Protocols for managing quality help businesses deliver on these customer expectations. Customers are more likely to use businesses regularly that provide good standards of products and customer service.

It helps businesses grow their customer base

Satisfied customers are more likely to tell their family members and friends about businesses that impress them. They may also post glowing reviews on social media and business websites. People often trust positive recommendations from ordinary people and try the businesses they suggest. By encouraging positive word-of-mouth, managing quality can be a great way for businesses to attract new customers.

It increases revenue

A growing customer base and more loyal customers can help businesses significantly grow their revenue. Managing quality also helps businesses move their stock, so they're less likely to have goods stay on shelves or need dramatic discounts. The management of quality also reduces waste, which further benefits a company's profits.

It reduces human error

Quality management clearly defines quality standards and the best methods to achieve these standards. Employees know their goal and have a clear plan for reaching it. As the plan achieves the desired results, employees can work confidently with a reduced risk of errors.

It builds a business's positive reputation

A commitment to managing quality can help businesses earn a reputation for quality products and services and high levels of customer service. It takes sustained effort over many years to build this positive reputation. Once established, ongoing management of quality can help a business keep their positive reputation.

It helps businesses grow

As businesses grow their customer base and increase their profits, they may expand their operations over time. They may hire new employees to meet the demand from satisfied customers and a growing customer base. With clear quality management in place, new employees can quickly understand their role and tasks. They may need less training and be able to work independently sooner. Quality management systems are also scalable, so businesses can continue applying them as they grow.

Related: What is Business Development?

It encourages continual improvement

Effective management of quality involves continually assessing the business. Managing quality well involves identifying ways to improve quality and implementing these measures. Good quality managing practices encourage businesses to seize every opportunity to do better.

Components of quality management

Here are the four components of quality management:

Quality planning

Quality planning is the planning of quality standards and procedures. It's the initial stage of managing quality, providing a solid foundation for all quality management activities. Here are some activities involved in quality planning:

  • defining acceptable quality standards

  • noting stakeholder expectations or goals for quality

  • determining how to meet quality standards

  • evaluating legal processes and standards for quality

  • scheduling reviews of procedures and processes

Quality control

Quality control involves inspecting and testing the blueprint for quality developed during the planning stage. Effective quality control management includes identifying errors or issues caused by executing the plan. Correcting these issues quickly helps the business reach its set quality standards.

Quality assurance

Quality assurance involves assessing goods and services. Businesses usually assess the quality of their goods and services before delivering them to customers, so they can identify and correct any issues before sale. As part of quality assurance, businesses also review their production processes and identify measures for improving product quality or efficiency. Some businesses use external quality assurance specialists who can offer objective perspectives on their products, services and procedures. The most effective quality management practices encourage regular quality assurance processes, ideally after the production of every product or service.

Read more: What Is Quality Assurance?

Quality improvement

Quality improvement is the final component of good management of quality. This component sees businesses analyse quality planning, control and assurance data. They can use this data to refine their procedures and systems. Improvements to quality management could help businesses get better with each production cycle.

Principles of quality management

Here are the key principles of quality management according to the International Standard for Quality Management:

Customer focus

Focusing on customers during quality management helps businesses meet and exceed consumer expectations. Viewing products and services from their point of view helps businesses effectively meet their needs over time. When customers feel a business meets their needs, they typically spend more and stay loyal.

Related: 12 Good Customer Service Examples

Leadership

Businesses with strong leaders set an example for their employees. Employees understand that quality matters when they see their managers value it. Businesses look for strong leaders across all departments to inspire consistent effort from all employees. This consistency across the entire workforce is essential for effective quality management.

Related: What Does Leadership Mean? (Benefits and Steps to Improve)

People engagement

When employees engage with the business, they align with its core values and goals, including quality. Engaged employees feel motivated to achieve quality standards and improve the business's quality processes. They're more likely to work consistently and remain productive over time. They may also want to improve their skills to deliver products or services to a higher standard.

Process approach

The process approach principle focuses on making company processes as effective and efficient as possible. Strong procedures help businesses perform better and reduce their costs and waste. Businesses that effectively manage quality continuously look for ways to improve their processes.

Continuous improvement

Effective quality management involves continuously improving the business in all relevant areas. Regular review and analysis helps businesses assess the parts of the quality management system that work well and parts it may improve. Implementing suggested changes efficiently ensures businesses benefit from improvements as soon as possible.

Evidence-support decision making

An evidence-support decision making approach helps businesses develop a quality management plan that may succeed. Data on the business's current or past quality management system, including the results it achieved and the impact of past decisions, is vital evidence for businesses. Businesses may also look to independent studies on quality management for further evidence.

Relationship management

Different parties often impact a business's quality management efforts, including retailers and manufacturers. Managing relationships with these parties helps them understand the business' quality goals. When these parties understand quality goals, they may feel motivated to help them achieve. Open communication, such as receiving and acting on feedback, can help businesses manage their relationships.

Example of managing quality

Here's an example of how a business manages quality:

The Biscuit Baker makes several different types of biscuits. The business's range includes chocolate chip biscuits, melting moments and jam drops. To make sure the biscuits have the right look and taste, the business assembles a team of quality control inspectors. These inspectors perform random tests on the biscuits to assess whether each type has a consistent look and taste. They also make sure the packaging seals each biscuit for freshness and opens easily.

If the inspectors find a quality concern or variance in the biscuits, they pause production so the company can resolve the issue. The Biscuit Baker also regularly runs focus groups with people who taste test the biscuits. They collect feedback from the focus groups and make recommended changes to improve the biscuits.

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