Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Quality Control

What it is:

Quality control is the act of ensuring that a company's goods and services are built and delivered to spec, on time and at the appropriate cost.

How it works (Example):

For example, let's assume that Company XYZ makes widgets. The widgets come in blue and pink. To ensure that all the widgets are the same color pink and that the dye department is making the color consistently, it might create a quality control team that takes random samples of widgets and compares them for color consistency. If the team finds any variance, it has the authority to stop the production line until the process is corrected.

Quality control is not the same as quality assurance. Quality control usually monitors the finished product; quality assurance monitors the integrity of the production process.

Why it Matters:

Quality control is a crucial part of managing a successful company. If customers receive or perceive inconsistent products and services, they will stop coming or become less loyal. For this reason, a variety of management strategies, including just-in-time manufacturing, total quality management (TQM) and six sigma have been developed to help companies produce higher-quality products.

People in the food industry are especially sensitive to quality control, as any defect or inconsistency in a product can create recalls, bad reviews and lower sales.

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